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Quantum VS Help: File Maintenance |
Ancillary costs are costs which are additional to a product's buying cost. For example, when importing a product you might incur shipping costs, storage costs and import duty.
Ancillary Costing Maintenance provides a way of recording and editing these costs at each stage of the buying process, including purchase ordering, goods receipt and purchase invoice registration and matching. Ancillary costs may be associated with a particular product, with a group of products via their Product Group, Price Group, Major Product Group, or Analysis Code 1, 2 or 3 value, or with a particular supplier.
For an overview see How Does Ancillary Costing Work? below.
This section covers:
Once ancillary costing has been enabled on the system - see Setting Up Ancillary Costings - ancillary costs for a product or supplier may be set up and maintained in Quantum VS via Ancillary Costing records. In each record the Costing Type defines whether the ancillary cost will apply when ordering a certain product, or when ordering any product associated with a certain Product Group, Price Group, Major Product Group, or Analysis Code 1, 2 or 3, or when ordering from a certain supplier.
One or multiple ancillary costs can be defined on each record, showing who is charging for those costs and the amount. The cost can be a fixed charge or a variable charge based on the number of units ordered. Ancillary costs can be an actual value or a percentage and may be recorded in the local 'system' currency or in an overseas currency. To create, view, edit and delete Ancillary Costing records see Ancillary Costing Record Maintenance.
When a Purchase Order is raised and products or suppliers associated with an Ancillary Costing record are added, default ancillary costs are applied by the system (subject to the Ancillary Cost Hierarchy set up in the Other tab of the Price Book Flags control record) and shown on the Purchase Order. Users may update these ancillary costs at the purchase ordering stage, or later at the goods receipt and/or purchase invoice registration stages. See Viewing And Amending Ancillary Costs.
We have created an Ancillary Cost record for the product 'Blue Circle Cement'. This records four ancillary costs that we will incur in addition to the buying cost when ordering this product:
Shipping: £6000 (payable to Maersk)
Haulage: £2500 (payable to DHL)
Import Duty: £1000 (payable to HM Revenue & Customs)
Storage: £600 (payable to Port Of Liverpool)
When we place an order for 100 units of 'Blue Circle Cement', ancillary costs incurred when ordering this product display on the Purchase Order and can be edited. So, while the Product line shows the buying cost of ordering 100 units of 'Blue Circle Cement', the Purchase Order also shows a link indicating the additional 'ancillary' costs which will apply when ordering this product. The default ancillary cost total for this line is £10,100, comprising all of the ancillary costs recorded for the product on the Ancillary Cost record: £6000 shipping, £2500 haulage, £1000 import duty and £600 storage.
Each ancillary cost item can be viewed and potentially (depending on user permissions and how the record has been configured) amended on the Purchase Order. This is useful when costs have changed. For example, if Import Duty - as recorded on the Ancillary Cost record and thus the Purchase Order default - is £1000, but by the time of the transaction has increased to £1200, this cost can be amended by the user.
Note: Users may view and edit ancillary costs on the Purchase Order by clicking the available hyperlink. This will display in either the document header (if ancillary costs are associated with the supplier) or on the line (if ancillary costs are associated with the product).
When the Purchase Order is confirmed and a Goods Received Note generated, users may view and amend ancillary costs by clicking the ancillary cost hyperlink on the GRN in the same way as on a Purchase Order. This may be required if costs have changed between purchase ordering and goods receipt.
Note: When the user confirms the main 'stock' GRN, the system generates additional GRNs for each ancillary cost and supplier.
You will subsequently receive a Purchase Invoice from each 'supplier' company charging a fee for the ancillary costs involved in the transaction. At this point you will create a new Purchase Invoice Registration record to register each Purchase Invoice, selecting the 'Ancillary Cost' option in the Type field in the Purchase Invoice Registration record header.
To continue the example, you will receive the following invoices in relation to the order:
from the product's Supplier for the 100 units of 'Blue Circle Cement' - the product's buying cost.
from the Supplier 'Maersk' for the product's shipping cost.
from the Supplier 'DHL' for the product's haulage cost.
from the Supplier 'HM Revenue & Customs' for the product's import duty cost.
from the Supplier 'Port Of Liverpool' for the product's storage cost.
After entering the invoice total in the Purchase Invoice Registration record you will follow the standard procedure to match the total against the ancillary cost. There are standard procedures available for dealing with any buying differences, including issuing a Debit Note to recoup any buying deficit from the supplier. Once all lines have been allocated/matched, Purchase Invoice registration is complete.
For further details on viewing and amending ancillary costs on orders - at the Purchase Order, 'goods in' or invoicing stage - see Viewing And Amending Ancillary Costs.