Physical inventory is a critical business process through which a successful enterprise periodically inspects its assets to protect its large capital investments and to comply with auditing requirements. Physical inventory is the process of ensuring that the assets a company has listed in its production system match the assets it actually has in inventory. It also ensures that capital assets recorded in the Fixed Assets Accounting and Control System physically exist, determines if unrecorded or improperly recorded transactions have occurred, and identifies any excess, defective or obsolete assets on hand. An effective inventory results in an accurate accounting of capital assets, and indicates the reliability of the system of accountability for the acquisition, use, and disposal of those assets.
How this works in Oracle Assets:
Oracle Assets is a worldwide best practice tool which automates the physical inventory process to minimize administrative costs. The Physical Inventory feature in Oracle Assets assists you in comparing and reconciling your physical inventory data with the data loaded in Oracle Applications. This flow chart gives an overall picture of how physical inventory functionality works in Oracle Assets.
The standard steps are:
- Collect the actual asset details like asset tag number, asset number, units, etc. owned by each department. This is normally done by the physical inspection of the assets owned by each department.
- The second step would be to load the physical inventory details / actual asset details collected through the physical inspection into the FA_INV_INTERFACE table.
- Run the physical inventory Comparison Report which compares the actual asset details with the data loaded in the FA_INV_INTERFACE table.
- View the comparison details which will provide the details of assets which are different and the assets which match between the application and the physical inventory.
- Take the necessary actions to match the data in the application to the actual data.
A detailed discussion of the physical inventory functionality in Oracle Assets, the required setups, the different ways physical inventory details can be loaded to the interface table (FA_INV_INTERFACE), and how reconciliation happens can all be found in the document: Physical Inventory Overview in Oracle Fixed Assets (Doc ID 2003290.1)
With credit to Vaishali Karanth, Oracle Assets.