Matakuliah
Tahun
: F0642 / Perancangan Sistem Akuntansi
: 2009
Integration Production Process
Pertemuan 12 - 13
Management Accounting Systems Trends
• Enterprise software captures data and makes it available
across the value chain
– Improved systems allow for many more levels of analysis
– The emphasis in accounting is moving toward analysis and away
from transaction processing and recording
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The objectives of CAD/CAE are to:
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Improve design productivity
Reduce design lead time
Enhance design quality
Facilitate access to and storage of product
designs
• Make the design of multiple products more
efficient by eliminating redundant design
effort
• Execute design changes almost immediately
through the use of electronic messaging to
notify the shop floor
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CAD/CAE results in several data stores of information that are used
later in the IPP
• Bill of materials: Listing of all the subassemblies, parts, and raw materials
that go into a parent assembly showing the quantity of each required to
make an assembly
• Parts master—The parts master or raw material (RM) inventory master lists
the detailed specifications for each raw materials item
• Routing master—The routing master specifies the operations necessary to
complete a subassembly or finished good and the sequence of these
operations
– Includes the machining tolerances; the tools, jigs, and fixtures required; and the
time allowance for each operation
– Computer-aided process planning (CAPP): An automated decision support
system that generates manufacturing operations instructions and routings based
on information about machining requirements and machine capabilities
• Work center master—The work center master describes each work center
available for producing products, including information such as the machine
available at the station, its capacity, its maintenance needs, labor needs to
operate it, and so on.
– Workstation: Assigned location where worker performs his/her job
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– Work center: Group of similar work stations
Generate Master Production Schedule
• The master production schedule (MPS) is a
statement of specific production goals developed
from forecasts of demand, actual sales orders, and/or
inventory information
– It describes the specific items to be manufactured, the
quantities to be produced, and the production timetable
• Depending on the company’s approach, the schedule
may be based on information about finished goods
inventory levels and reorder points, sales forecasts or
actual sales orders coupled with inventory levels
• Based on the master production schedule, more
detailed schedules for ordering raw materials and
scheduling work center operations are developed
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Generate Master Production Schedule
The master production schedule is based on information from three sources
1. The first is actual orders from customers
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Ideally, a manufacturer can cut throughput times to the point that they can
produce goods only as customer orders are received
2. Sophisticated demand forecasting models to estimate the need for
goods
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Use customer data in the enterprise system about past sales levels and
buying patterns to improve forecast accuracy
Use information from the customer relationship management system
Use data mining to identify patterns and relationships in the level of demand
3. Finally, the inventory management system also provides vital inputs to
developing a better master production schedule
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Inventory Management
• Inventory Management System
– Provides data about levels of FG inventory on hand, and also gathers data about
goods scheduled to be produced.
– To develop better production schedules, the enterprise system tracks inventory
data over time including: lead times, optimal inventory levels, frequency of
stockouts, and expected quality levels all help develop better production
schedules.
• Global inventory management
– An inventory management approach where inventory needs and inventory and
production capabilities are matched across the entire global enterprise
• Production, planning, and control is a process that manages the orderly
and timely movement of goods through the production process. It includes:
– Planning material, people, and machine requirements; scheduling; routing; and
monitoring progress of goods through the factory
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MRP
• Materials requirements planning: Uses bills of material, raw material
and work-in-process (RM/WIP) inventory status data, open order data, and
the master production schedule to calculate a time-phased order
requirements schedule for materials and subassemblies
– Shows when a manufacturing order or purchase order should be released so
that the subassemblies and raw materials will be available when needed
– Process involves working backward from the date production to determine the
timing for manufacturing subassemblies and then moving back further to
determine the date that orders for materials must be issued
• In an enterprise system, this process is performed automatically using a
variety of data from the enterprise database, including:
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Bills of materials
Parts master data
Raw materials and work-in-process inventory status data
Open purchase order data showing the existing orders for materials
Develop Detailed Production Instructions
• Capacity requirements planning (CRP): uses the
information from the master production schedule and
time phased order requirements schedule to develop
detailed machine and labor utilization schedules
based on available capacity in the work center status
records
– CRP may lead to modifications to the master production
schedule or time-phased inventory requirements schedule if
sufficient capacity does not exist to complete these
schedules as planned
– Once these adjustments are completed, CRP assigns
targeted start/completion dates to operations (workstations)
or groups of operations (work centers) and releases
manufacturing orders and move tickets to the factory
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Develop Detailed Production Instructions
• Manufacturing orders (MOs): Authority for the
manufacture of a specified product or subassembly in
a specified quantity and describe the material, labor,
and machine requirements for the job
• The MO is the official trigger to begin manufacturing
operations.
– When MOs are released, they are generally accompanied by
move tickets (usually in the form of bar code tags) that
authorize and record movement of a job from one work
center to another
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Develop Detailed Production Instructions
• Raw materials requisitions sent to the inventory process.
• Triggered by the time-phased order requirements, Capacity
Requirements Planning (CRP) uses the following additional inputs from
the enterprise system to accomplish its functions:
– The routing master, which shows the necessary steps and time to complete
each one to produce the product
– Resource capacity information (i.e., hours available each day/week by work
center) from the work center master data
– Data about the current status of work center loads from the work center
status data (also known as loading data)
• These data can include MOs now at each work center, anticipated MOs,
backlogs, and actual hours ahead or behind schedule.
• This data is supplemented by information from the employee/payroll master data
that shows available labor capacities
• Together, materials requirements planning (mrp), CRP, and the
process of planning cash flows to accommodate needs generated by
the production schedule is referred to as manufacturing resource
planning (MRP)
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Flexible Manufacturing Systems
• Flexible manufacturing systems (FMS) are
systems used to control actual production of the
goods
– An FMS is an automated manufacturing operations
system that can react quickly to product and design
changes because centralized computer control provides
real-time routing, load balancing, and production
scheduling logic
– The goal is to make the plant more flexible, achieving
the ability to quickly produce wide varieties of products
using the same equipment
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Components of
Flexible Manufacturing Systems
• Computer-aided manufacturing (CAM)
– CAM systems take advantage of integration within enterprise
systems to automatically incorporate design changes made by
engineering into production processes on a nearly real-time basis,
therefore decreasing the time to integrate new innovations
– The application of computer and communications technology to
improve productivity by linking computer numerical control (CNC)
machines, monitoring production, and providing automatic feedback
to control operations
• Machines that use Computer numerical control (CNC)
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robotics
automated guided vehicles
automated storage/retrieval systems
digital image processors
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Just-in-time Objectives
• Philosophy that simplifies production and reduces
inventory
– Zero defects through better design and worker inspections
– Zero setup times through better factory design
– Small lot sizes through minimizing throughput time and pull
mfg.
– Zero lead times through eliminating non-value-added
activities (moving, waiting, inspection)
– Zero inventories through closer relationships with suppliers
and quicker throughput
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JIT Implementation Features
• Arrange factory in U-shaped work cells to optimize
material flow
• Assign 1 worker to multiple machines
• Give production workers authority to stop the line if
they are behind schedule or if they discover defects
• Require that daily parts production schedule remains
constant
• Develop close working relationships with vendors
• Simplify the process for tracking the movement of
goods through the factory
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Record Manufacturing Events
• Shop floor control (SFC) process monitors
and records status of manufacturing orders
as they proceed through the factory
– Maintains work center status information showing
the degree ahead or behind schedule and
utilization levels
– May use automatic data collection for immediate
feedback and control such as:
• Scanning a bar code label attached to the product
• Entering quality and quantity information through
workstations located on the factory floor
• Scanning employee badges and touching a few places
on a computer touch screen to indicate labor time the
completion of manufacturing tasks
– Raw materials issue and return notices will also be
recorded
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Generate Managerial Information
• Data collected is usually available in real time
• Can be compared with standards for variance analysis in
real time
• Managers can take corrective action before they even
receive the formal variance reports
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Generating Managerial Information
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Variance Analysis
• Compares actual costs and usage to standards costs
and usage
• Not perfect, but a useful control measure
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1.0 Record Standard Costs
• Standard cost information contained in master data
• Each time move ticket data is entered (department
completes work) WIP is updated
• Issuance of raw materials updates the WIP
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2.0 Compute Raw Material Quantity Variance
• Differences in RM used
– RM are first issued to production in standard quantities
– If additional materials are later issued to complete the MO we have an
unfavorable usage variance
– If unused materials are returned to stock we have a favorable usage
variance
– Reported through the data flows “Excess RM issue notice” and “RM
returned notice,” respectively
• Usage variance: multiply the differences in quantities by standard unit
costs
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3.0 Compute Direct Labor Variance
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Information captured with an employee card swipe, a bar code scan of the
job order, and a few simple entries.
Data used to compute DL Variances
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Actual pay rates
Actual hours
Standard Pay Rates
Standard Hours
DL rate variance:
– (Actual pay rates – standard pay rates) x Actual hours
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DL efficiency variance:
– (Actual hours – standard hours) x Standard pay rate
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4.0 Close Manufacturing Orders
• Final move ticket data marks the end of the conversion process and
the movement of goods to the FG warehouse.
• Information processing activities that result from the final move ticket
are:
– Close the cost record maintained in the WIP inventory data and
compute the standard cost of the goods completed.
– Through the data flow “GL cost of goods completed update,” notify the
general ledger to make the appropriate entries.
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5.0 Compute Overhead Variances
• Usually done at end of an accounting period, often monthly
• To compute the manufacturing overhead (MOH) variances:
– Retrieve flexible budget from the budgets master data
• Flexible budget amount is based on the standard hours allowed to
complete the actual finished goods output for the period
– Retrieve actual MOH incurred from the GL master data
– Retrieve WIP data to determine the standard hours charged to all
jobs during the period
– Compute the overhead variance
• Standard hours charged to all jobs x standard MOH rate per hour
• Variances are reported to the GL and the appropriate
managers
• There are nuances between the variances for variable
overhead and fixed overhead which are usually covered in
managerial or cost accounting courses
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Inventory Management
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Management Fraud
• Inventory manipulation is a prime suspect in
management fraud
• It is typically a large account where fraud my be hidden
• AICPA Practice Alert No. 94-2 lists types of inventory
fraud
– In general, inventory is overstated using various techniques
including counting empty boxes and consigned goods, falsifying
counts, double counting goods in transit, false confirmation of
goods held by others, failure to record payable on inventory,
falsifying reconciliations
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Inventory Process controls
• Effectiveness of operations
– maintain sufficient inventory to prevent stockouts
– maintain sufficient inventory to maintain operational
efficiency
– minimize cost of carrying inventory
• Maintain accurate perpetual inventory records (know what
inventory levels exist)
• JIT materials acquisition (no overstocks)
• Internal transfer procedures including global inventory
management
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Inventory Process Controls
• Efficiency of inventory operations
– JIT materials acquisition including vendor managed inventory
(VMI)
– Warehouse bin location (optimizes size and location of inventory
bins)
• Resource security
– periodic physical inventory counts
– locked storerooms
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