ABC Codes

THIS SECTION IS MANAGED BY FINANCE 

There is the ability to use the ABC Code functionality for a cycle count. Follow the instructions below.

Follow the path: Xmc>Material Management >Inventory Management >Set Up > ABC Code

Use the ABC Codes > Detail sheet to configure ABC codes to match the cycle counting process you run at the current site. You first create ABC codes and enter their default values within ABC Code Maintenance. However the values you enter on this sheet override these default ABC Code values to define the specific counting processes for the current site.

To define the ABC code options:

1. Click the Down Arrow next to the New button; select New ABC Code.

1. Navigate to the Modules > Inventory Management > Cycle Count > AbcCodes > Detail sheet
2. Click the ABC Code button to find and select the existing ABC code you want to modify.

4. Select the Exclude From Cycle Count check box to indicate parts linked to the selected ABC code are only counted during physical inventory and not included during cycle counting.

5. Select the Override Stock Validation check box to cause the stock valuation for the current site to be used instead of the stock valuation defined on the ABC code. Enter this alternate valuation in the accompanying Stock Valuation Percent field.

6. The Stock Valuation Percent defines how stock is valued for the site configuration. When the Calculate ABC Codes program is run (located in the Material Management > Inventory Management > General Operations folder), it determines total stock valuation for each part. Usage, on-hand quantities, and/or projected usage factors can be included in the total value calculation.

If the same percentage is entered for multiple ABC codes, the Calculate ABC Codes program uses the first occurrence of a duplicate percentage and ignores the second occurrence, since it evaluates ABC codes in alphabetical order.

Note: For example, if you enter 80.0 for ABC Code A, the Calculate ABC Codes program assigns Code A to inventory items that represent 80% of the total inventory value. If you enter 95.0 for ABC Code B, the Calculate ABC Codes program assigns Code B to inventory items that represent the next 15% of the total inventory value. Enter 100.0 for ABC Code C to assign this code to inventory items that represent the remaining 5% of the total inventory value.

7. Select the Override Count Frequency check box to indicate the value entered in the accompanying Count Frequency field is used instead of the value defined on the ABC code.

8. Enter the Count Frequency value to designate how often parts assigned to this ABC code are counted. This value specifies the number of days between each count cycle.

Note: For example, ABC code A items require counting every 60 days, so you enter 60 in this field. When you select parts for cycle counting, the Epicor application selects all A items not counted within the past 60 days.

9. Select the Calculate Percent check box to indicate the value entered in the accompanying Percent Tolerance field is used to control discrepancy tolerances in cycle or physical inventory counts. If a part is defined as out of tolerance, you can post adjustments to the inventory quantity using a Count Discrepancy Reason code in Count Cycle Maintenance.

10. Next, enter the Percent Tolerance value to designate the percentage difference between the pre-count quantity and the actual count quantity. This value defines how much variation you allow for each count. Enter zero (0) to indicate you do not accept any percentage variance. A percentage higher than zero indicates a percentage difference between the pre-count quantity and the actual count quantity, by more than this value, is considered out of tolerance. This result is then included on count variance reports.

Note: For example, enter 10.5 if the percentage difference between the pre-count quantity and the actual count quantity can vary by no more than 10.5 percent.

11. Select the Calculate Quantity check box to indicate the value defined in the accompanying Quantity Tolerance field is used to control quantity discrepancies. If the calculated difference between the pre-count quantity and actual count quantity is greater than the specified tolerance, the Count Variance Calculation/Report displays these parts. You can post adjustments to the inventory quantity using a Count Discrepancy Reason code in Count Cycle Maintenance.

12.Enter the Quantity Tolerance value to designate the difference between the pre-count quantity and actual count quantity you allow in this site. Enter zero (0) to specify you do not accept any quantity variance. A value higher than zero indicates a quantity difference between the pre-count quantity and the actual count quantity, by more than this value, is considered out of tolerance. This result is then included on count variance reports.

Note: For example, enter 10 if the calculated difference between the pre-count quantity and actual count quantity for a part can vary by no more than 10.

13.Select the Calculate Value check box to indicate the monetary value defined in the accompanying Value Tolerance field is used to control cost discrepancies.

14.Enter the Value Tolerance to indicate the difference you accept between a part quantity’s pre-count cost and actual count cost. Enter zero (0) to indicate any monetary variance is out of tolerance. A number higher than zero indicates a cost amount difference between the pre-count value and the actual count value, by more than this cost limit, is considered out of tolerance. This result is then included on count variance reports. You can post adjustments to the inventory quantity using a Count Discrepancy Reason code in Count Cycle Maintenance.

Note: For example, enter 100.00 if the cost difference between the pre-count quantity and the actual cycle count quantity can vary by no more than $100.00.

15.Make adjustments to other ABC codes as you need. When you finish, click Save.

Additionally, the Epicor application overrides ABC code count parameters defined on the site configuration through values you can define in the following programs:

• Part Maintenance – Cycle count settings are defined for specific parts/warehouse relationships on the Part > sites > Warehouses > Cycle Count > Physical Inv sheet.
• Warehouse Maintenance – Cycle count settings are defined for warehouses on the Cycle Count/Physical Inventory sheet.
• Part Maintenance – Cycle count settings are defined for specific site/part relationships on the Part > Sites > Sites > Cycle Count\Physical Inv sheet. 

Any values entered in the above locations override the values on the site configuration. Use these cycle count settings to precisely determine how each part quantity is included in cycle counting.