The Stock Obsolescence Generation program is used to generate the stock obsolescence provision values by item. The Stock Obsolescence file basically contains the obsolescence movement amount by period and item and indications of the formula applied to achieve these values. The total obsolescence in any item is therefore the sum of all the records for that item up to the period required.

The General Ledger accounts for posting journals are also stored here. This is used for substantiating the final journal produced as well as tracking the accumulated write off values on a month by month basis.

The calculation of obsolescence values and printing the obsolescence report can be executed as many times as required within a period, with adjustments of rates or start dates in between in order to achieve correct values. This is possible because once the edit listing has been checked and entries posted, the previous calculations will be reversed. Once this process is complete, the final production of the journals may be performed.

The calculation will ignore items that contain negative or zero stock values as well as any items not coded to be picked up in the formula definition table (either because the start date indicates not to be amortized or there is no definition for that inventory category). Non stock items are excluded even if they are in the definition.

For obsolescence method based on sales, control file TMSDS/IWD-SA can be setup to exclude non sales, exclude return quantity and the sales quantity can be counted from the start of the 1st obsolescence month as opposed to the start date defined by the Start code date. Obsolescence can be suspended upon new receipt or transfer with number of months to suspend as defined by the Start from code ‘B’ in control file TMSDS/IWD-STRT.

This process is driven by effective period (by month) upon which it will calculate the write down value up to the end of the nominated month.

The Calculation is as follows:

The Obsolescence Provision will be calculated as a ratio:

[[month end date]-[publication date or override date]] / [default amortization period or overridden amortization period], x the inventory title cost.

Month End Date is the defaulted previous Period.

Default Publication Date is the actual date the publication is published as recorded on the Inventory file.

Publication Date Override is the override Start date from the actual day but the Ending date will always coincide with the calendar month and date for the month requested to process. This is set at the Stock Item Level.

Default Amortization Period Override is the alternative Period over which the Inventory Title should be amortized, set at the Stock Item Level.

Generate stock obsolescence

1. In the menu expand, Base Modules > General Ledger > Other > Stock Obsolescence > Generation Cycle and then double-click Generate GL Stock Obs. DSO512 Stock Obsolescence Provision Generation panel appears. 

2. Enter the above information and click OK to confirm.  Job processing panel is displayed. Change the job queue if required and select to run the process in batch or real time. Click OK to confirm the selection. Stock Obsolescence is generated. View stock obsolescence report to view the results.