RECALCULATE PRODUCT COST LOGIC

A2000 ONLINE SUPPORT DEPARTMENT

KNOWLEDGE BASE

BACKGROUND

A2000ERP allows user to create both back and post-dated transactions, as well as selling items into “negative stocks”. 

The system allows user to block such transactions, but many chose to allow these for operational flexibility. With such aberrations, stock cost will go wrong and need this Recalculate Product Cost to correct the costing. 

Note: If system is set to disallow add/edit of back/post-dated transactions, and disallow negative stocks, then Recalculate Product Cost is not necessary

WHAT HAPPENS WHEN RECALCULATION RUNS?

The recalculation process will re-arrange all the stock transactions in chronological order and re-work the costing; it clears the existing cost in the respective products and refresh with the correct quantities and costing. 

HOW LONG DOES IT TAKE TO RECALCULATE?

It depends on the number of products being recalculated, how big the date range being processed (since when the last Period Locking happened) and the number of transaction line items involved.

For example, if user selects a list of products 1000 stock products, and there are 2,000 lines of transactions (across the recalculation time line), the system we need to process 1,000 x 2,000 = 2 million loops before the process completes. 

We have users who recalculate from anything like 1000 up to 100 million loops in each process. The time to recalculate may ranges from 0.5 seconds to 10 hours.

WHY DO WE NEED TO LOCK THE SYSTEM?

This is a critical process with multiple tables in the database locked while re-writing the cost. If they are locked at that moment it is being recalculated, another user creating a sales or purchase transaction, will have a record that did not update correctly. This creates new cost error in that product, negating the reason why a recalculation of that product cost is needed in the first place.

The impact is that many users do not understand or know why their cost is wrong, which creates erroneous cost of sales in their financial reports.

Note: In past versions of recalculation, we do not lock the tables and many users faced the issue of wrong costing after recalculation. When the recalculate these individually again, the cost becomes correct. Therefore, at the suggestions of audit and accounting partners, for our system to maintain cost integrity, we now lock the tables during this critical process. Our latest updates will ensure appropriate locks are in place to prevent erroneous cost flowing into the financial statements.

SAFEGUARDS FOR COST RECALCULATIONS

We have added validations to help users avoid the pitfalls of erroneous costing. 

NOTE: Administrators should note that table locking when recalculating will cause errors in the respective operational updates, affecting cost integrity.

NOTE: Administrators who are triggering a recalculation process should note the duration they may cause disruption (if users cannot log in). We recommend that such Recalculation activities be conducted only when no other users are accessing the system.

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