Oracle Inventory Terminology

In this Post, I will explain about the Oracle Inventory terms which heavenly used in the
documenting the 'Inventory - To Be Flows'. It is recommended that the Inventory users
should know the definitation of these terms.

Item Validation Organization: The Organization that contains your master list of items.
You define it by setting the "OE: Item Validation Organization" profile option.

Organization: A business unit such as Plant, Warehouse, Department and so on. Order
Management refers to organizations as Warehouses on all Order Management windows
and reports.

Logical Organization: A business unit that tracks item for accounting purpose but does
not physically exist.

Destination Organization: An Inventory Organization that receives item shipments

from a given organization.

Workday Calendar: A calendar that identifies available workdays for one or more
organizations. Master Scheduling/MRP, Inventory, Work in Process, and Capacity plan
and schedule activities based on a calendar’s available workdays.

Workday Exception Set: An entity that defines mutually exclusive sets of workday
exceptions. For each organization, you can specify a workday calendar and exception set.

Primary Unit of Measure (UOM): The stocking unit of measure for an item in a
particular organization.

Unit of Measure: The unit that the quantity of an item is expressed.

Unit of Measure Class: A group of UOM and their corresponding base UOM. The
standard unit classes are Length, Weight, Volume, Area, Time, and Pack.

Unit of Measure Conversions: Numerical factors that enable you to perform

transactions in units other than the primary unit of the item being transacted.

Category Code: It used to group items with similar characteristics, such as plastics,
metals, or glass items.

Category Set: A feature in Inventory where users may define their own group of
categories. Typical category sets include purchasing, materials, costing, and planning.

Purchased Item: An item that you buy and receive. If an item is also an inventory item,
you may also be able to stock it.
Standard Item: Any item that can have a bill or be a component on a bill except
planning items, option classes, or models. Standard items include purchased items,
subassemblies, and finished products.

Substitute Item: An item that can be used in place of a component. Master

Scheduling/MRP suggests substitutes items on some reports.

Inventory Item: Items you stock in inventory. You control inventory for inventory items
by quantity and value. Typically, the inventory item remains an asset until you consume
it. You recognize the cost of an inventory item as an expense when you consume it or sell
it. You generally value the inventory for an item by multiplying the item standard cost by
the quantity on hand.

Item Aattribute Control Level: To maintain item attributes at the item master attribute
level or the Organization specific level by defining item attribute control consistent with
your company policies. For example, if your company determines serial number control
at headquarters regardless of where items are used, you define and maintain serial
number attribute control at the item master level. If each organization maintains serial
number control locally, they maintain those attributes at the organization specific level.

Item Attributes: Specific characteristics of an item, such as order cost, item status,
revision control, COGS account, etc.

Item Master Level Attribute: An item attribute you control at the item master level as
opposed to controlling at the organization level.

Item Status Code: It used to control the transaction activity of an item.

Deletion Constraint: A business rule that restricts the entities you can delete. A deletion
constraint is a test that must succeed before an item, bill, or routing can be deleted.

Current On–hand Quantity: Total quantity of the item on–hand before a transaction is
processed.

Subinventory: Subdivision of an organization, representing either a physical area or a

logical grouping of items, such as a storeroom or receiving dock.

Locator: Physical area within a subinventory where you store material, such as a row,
aisle, bin, or shelf.

Locator Control: An Oracle manufacturing technique for enforcing use of locators

during a material transaction.

Revision: A particular version of an item, bill of material, or routing.

Revision Control: An inventory control option that tracks inventory by item revision and
forces you to specify a revision for each material transaction.

Lot: A specific batch of an item identified by a number.

Lot Control: An Oracle Manufacturing technique for enforcing use of lot numbers
during material transactions thus enabling the tracking of batches of items throughout
their movement in and out of inventory.

Serial Number: A number assigned to each unit of an item and used to track the item.

Serial Numbers Control: A manufacturing technique for enforcing use of serial

numbers during a material transaction.

Min–max Planning: An inventory planning method used to determine when and how
much to order based on a fixed user–entered minimum and maximum inventory levels.

Re-order Point Planning: An inventory planning method used to determine when and
how much to order based on customer service level, safety stock, carrying cost, order
setup cost, lead time and average demand.

Safety Stock: Quantity of stock planned to have in inventory to protect against

fluctuations in demand and/or supply.

ABC Classification: A method of classifying items in decreasing order of importance,

such as annual dollar volume or your company’s transaction history.

Cycle Counting: An inventory accuracy analysis technique where inventory is counted

on a cyclic schedule rather than once a year.

Physical Inventory: A periodic reconciliation of item counts with system on–hand

quantities.

Account Aalias: An easily recognized name or label representing an account charged on

miscellaneous transactions. You may view, report, and reserve against an account alias.

Inter–Organization Transfer: Transfer of items from one inventory organization to

another You can have freight charges and transfer credits associated with inter–
organization transfer. You can choose to ship items directly or have them go through
intransit inventory.

Material Transaction: Transfer between, issue from, receipt to, or adjustment to an

inventory organization, subinventory, or locator. Receipt of completed assemblies into
inventory from a job or repetitive schedule. Issue of component items from inventory to
work in process.

Transaction Cost: The cost per unit at which the transaction quantity is valued.
Transaction Interface: An open interface table through which you can import
transactions.

Transaction Manager: A concurrent program that controls your manufacturing

transactions.

Receipt: A shipment from one supplier that can include many items ordered on many
purchase orders.

Return-To-Supplier: A transaction that allows you to return to the supplier items from a
fully or partially received purchase order and receive credit for them.

Accounting Period: The fiscal period a company uses to report financial results, such as
a calendar month or fiscal period.

Average Costing: A costing method which can be used to cost transactions in both
inventory only and manufacturing (inventory and work in process) environments. As you
perform transactions, the system uses the transaction price or cost and automatically
recalculates the average unit cost of your items.

Standard Costing: A costing method where a predetermined standard cost is used for
charging material, resource, overhead, period close, job close, and cost update
transactions and valuing inventory. Any deviation in actual costs from the predetermined
standard is recorded as a variance.