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 Nonvaluated Sales Order Stock: Constraints Locate this document in the navigation structure

Review the following constraints before deciding whether to use a nonvaluated sales order stock.

  • Cost Object Controlling is only possible at the level of the sales order item:

Preliminary costing of assigned manufacturing orders (production orders and process orders) does not include the costs for individual requirements components.

These actual costs for the manufacturing orders assigned to the sales order item are incomplete because the withdrawal of an individual requirements material does not debit the manufacturing order.

The full planned costs are calculated in a cost estimate for the sales order item.

You can obtain complete actual costs by settling the manufacturing orders to the sales order item or through direct assignment of the costs of externally procured materials to the sales order item.

Reliable and complete data in Cost Object Controlling is only possible at the level of the sales order item.

  • Variances cannot be calculated:

With a nonvaluated sales order stock, the system does not report all costs of multilevel BOMs on a manufacturing order in which individual requirements semifinished products or raw materials are used. Variance calculation is therefore unreliable and is not supported.

  • Inventory valuation is collective valuation:

The value of the nonvaluated sales order stock is calculated by results analysis at the end of the period. Capitalization is achieved by settling the capitalized costs or the revenue in excess of billings to Financial Accounting . The sales order inventory for a sales order item can contain different materials. Results analysis, however, does not valuate the materials individually but instead calculates a total value for the sales order item. This value is the sum of the nonvaluated inventories of finished products and work in process.

  • If you are using cost-of-sales accounting, the cost of sales is not updated to Financial Accounting (FI) until results analysis is performed. If you are using cost-of-sales accounting in FI, the cost of sales cannot be seen until results analysis has been performed and the calculated values settled to FI.

  • Standard costing is not possible

The sales order is always debited with the actual cost of goods manufactured of the manufacturing order. The complete transfer of actual costs to the sales order item means that separate cost management for production and sales with standard costing is not possible. Standard costing is of particular importance in mass production using sales orders. Because the manufacturing order is credited at planned costs in make-to-stock production, the different types of processing in sales-order-related production and make-to-stock production result in different costs. This is undesirable when a product is manufactured in both make-to-stock production and sales-order-related production.