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What If Cost Analysis

  • 1.  What If Cost Analysis

    NAVUG ALL STAR
    Posted May 05, 2021 10:55 AM
    Does anyone do any What if Cost Analysis - analyzing raw material cost increases and rolling them up (through production BOMs) to review change to finished good costs?
    Are there any add-ons for this?


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    Lewis Rosenberg
    IT Manager
    Mars Fishcare
    Chalfont PA
    www.apifishcare.com
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    D365UG-BC/NAVUG All-Star
    D365UG-BC/NAVUG Board of Advisors, Chairperson Emeritus
    D365UG-BC/NAVUG Programming Committee

    Twitter: @RosenbergL
    LinkedIn: https://www.linkedin.com/in/rosenbergl
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  • 2.  RE: What If Cost Analysis

    SILVER CONTRIBUTOR
    Posted May 06, 2021 10:17 AM
    We perform the What if scenarios in our test database copy using the same processes that are needed to update costs (update costs on Raw Materials and L&OH rates).  There have been times that we have so much going on in the test database copy that we have made another database copy to do these scenarios.

    For us, this is a requirement of our financial audit as we use standard costs and need to get to a FIFO cost for GAAP purposes.

    The need for What-if costs is desired in 4th quarter to be used for the following year's budgeting and goal setting.

    I am interested if there is an add-on or a better solution.


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    Kari Strandberg
    Director of Finance
    Bernatello's Foods
    Maple Lake, MN
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  • 3.  RE: What If Cost Analysis

    TOP CONTRIBUTOR
    Posted May 06, 2021 10:20 AM
    If you are using Standard Cost the Standard Cost Worksheet is as great tool. Alternately, if you have a reporting database it presents another good option.

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    Andrew Good
    President
    Liberty Grove Software
    Oakbrook Terrace IL
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  • 4.  RE: What If Cost Analysis

    TOP CONTRIBUTOR
    Posted May 06, 2021 11:03 AM
    I have had a few clients over the years that do costing what-if analysis with inventory items.  I have never found an add-on that would work for the 'typical' NAV/BC end user.  There are some very good 3rd party solutions out there, but they are designed for companies that use AX, Oracle, SAP, etc. and are out of reach, from a budgetary perspective, for most end users here.

    I see Excel used for this, typically with a DB connection such as Jet or SSRS to automate pulling data into the worksheet.

    Let me know if you find anything.

    Sincerely,
    Victor Diercksen

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    Victor Diercksen
    CIO
    CIO/NOW Inc.
    Sandy UT
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  • 5.  RE: What If Cost Analysis

    TOP CONTRIBUTOR
    Posted May 06, 2021 12:43 PM

    Lewis - adding to the discussion. You are able to populate the Standard Cost Worksheet with FIFO costs even if you are not a Standard Coster. Use the Suggest Item cost and populate Purchased items first using FIFO costs. Update key items with a new what if cost and then select to Roll-up Prod. Order items which will use the new what if costs in the worksheet for the purchased item and give you a new prod. Order item cost. All can be done in the Standard Cost worksheet.

    You are also able to 'implement' even though you are not using Standard costing. Note: The implement from the Standard Cost worksheet may create revaluation journal entries which most customers will delete from month to month but could be used to revalue the layers once a year for FIFO purposes if needed. Using the Standard Cost Worksheet with FIFO would be a tool for 'what if' even if you do not implement the results.

    The implement causes the Rolled up and Single level values to be populated on the item record and the Standard Cost field is populated but none of the values aret used in any day-to-day transactions since the costing method is FIFO. This would allow you to use those values on the item record for ad hoc reporting.
    All the above is available but as usual I recommend using a TEST company to validate before changing any of your processes.

    For a single item you also could also create a Simulated Production Order to see all the costs right now using Unit cost values and a what if quantity for the item suing the statistics view on the Prod. Order. The Cost Shares from the item card can also be used to quick view an item cost for a qty of 1.

    Best Regards



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    John Grant
    Senior Application Consultant
    Innovia Consulting
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  • 6.  RE: What If Cost Analysis

    NAVUG ALL STAR
    Posted May 06, 2021 09:15 PM
    Thanks John.  I think I suggested that to our team a couple of months ago and I don't remember if I ever got a response.  I just put a demo video together for them to see how it actually works.  I think the steps you outlined are exactly what they are looking for.  We'll see.

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    Lewis Rosenberg
    IT Manager
    Mars Fishcare
    Chalfont PA
    www.apifishcare.com
    ------------------------------------------------------------------------
    D365UG-BC/NAVUG All-Star
    D365UG-BC/NAVUG Board of Advisors, Chairperson Emeritus
    D365UG-BC/NAVUG Programming Committee

    Twitter: @RosenbergL
    LinkedIn: https://www.linkedin.com/in/rosenbergl
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