Jan 6, 2008

Steps in ISO Cycle

Set Up:
1. Item to be set up as 'Internal Ordered' and 'Internal Orders Enabled' .
2. Shipping network to be set up between the sending Org and the Receiving Org. (N) Inventory --> Setup --> Organizations --> Shipping Networks

1. Create an Internal Requisition in the PO Module
2. Run the 'Create Internal Orders' Process in the PO Module. If everything is set up correctly, this will create an internal order.
3. Run the 'Order Import' Process in Order Management Module. Select 'Source' as 'Internal' and 'Reference' as the internal requisition created in step 1. This will create a new order in OM
4. Ship the item in Order Management, when shipping the 'Interface Trip Stop' Process will run followed by 'Receiving Transaction Processor'.
5. Create a receipt in the PO Module. Select the 'Requisition Number' as the 'Internal Requisition' created in Step 1.

This completes the ISO Cycle. The accounting entries generated are as follows.

1. On shipping the item:
Inventory A/c Cr
Inter Org Transfer A/c Dr

2. On receipt:
Inventory A/c Dr
Inter Org Receivable A/c Dr
Inter Org Transfer A/c Cr
Inter Org Payables A/c Cr

Please let me know if you faced any problem while following these steps. Do share with me so that I can update the documentation.


Hemant said...


While doing ISO we have to do it in one inventory organization.However in India Localization our client requirment is intercompany internal sales Order (within two operating units) with updating the registers-RG , VAT & also AR & AP invoices.

Could you please give some solutions.

Hemant T

Ramaswamy VK said...

Immediately three solutions come to mind.
1. Manual updation of various registers. You have the facility to update all the registers manually in Oracle Apps.
2. Customization to update the register tables upon completion of transaction.
3. Instead of routing the transactions through the ISO cycle, use the 'Supplier - Customer' model where one operating unit is the 'Suppler / Customer' of the other and the material transaction can be routed through the standard 'Purchase Order - Sales Order' route where all the localization impact will be handled by the system.
If I know your detailed requirements, probably I can suggest better solutions.
By the way, you no longer need to maintain the registers in the old format. You just need to provide the material transaction information to the authorities.

Arunkumar k said...


We have a requirement to hit the COGS account if the standard cost of the item changes when it is in transit. Will passing COGS account as purchase price variance account in shipping network solve this? Please suggest.

Ramaswamy V Krishnamurti said...

Hello Arunkumar
I am not working on the product. Currently I have moved to General Management. If you can let me know your requirements and the details of you instance and modules implemented I can try to help.