Surcharge Processing QAD 2010 Business Issue 5 Short

Surcharge Processing QAD, 2010

Business Issue 5 Short and long term commodity price fluctuations force material suppliers to attempt to recoup costs using surcharges on items such as steel. 5 Manufacturers struggle with how to track these additional costs and ultimately recover the amounts from their customers. QAD Proprietary

Business Issue Typical problems described include: – How to capture the surcharges paid to suppliers, and compare that with amounts invoiced and collected from customers? – How to simplify the invoicing process while including a calculation of the appropriate/agreed to surcharge for each individual shipment? – What are the options for Pay/Charge/Absorb? – How does timing impact my ability to match payments with invoices/accruals? – How do I include expected surcharge rates into sales forecasting and margin reporting? QAD Proprietary

Traditional Options 5 Supplier side – Record (distribute) surcharge amounts based on supplier invoice information when vouchered in AP • Requires manual distribution • Not matched to any other elements of the process 5 Customer Side – Container/Line Charges • Flat rate, not based on amount shipped – Additional line/trailer amount added to order/invoice • Manual process, impacts order entry and invoice processing time/accuracy QAD Proprietary

Solution! SMC – “Surcharge Management and Control” 5 Supplier Side – Utilize Logistics Accounting module to accurately accrue for surcharges payable to suppliers, based on amounts included in item cost information, for later reconciliation with surcharges invoiced – Defined accounting to easily reconcile surcharges paid against surcharges collected 5 Customer Side – Leverage existing QAD functionality (Freight Management) to automate calculation and invoicing process based on amount shipped and effective surcharge “rates” – Post automatically to designated GL account for reconciliation QAD Proprietary

Solution! SMC - “Surcharge Management and Control” 5 Features: – – – – QAD Proprietary Calculate surcharge by item weight, or other unit of measure Automatic processing based on setups by customer/item Rate maintenance based on effective date ranges Compliant with discrete orders, customer schedules Compliant with standard and enhanced shipping Manual adjustment to charges where required Warning message for “incomplete” calculation Facilitates reporting and analysis through “effective date” of surcharge rates

Solution! SMC – “Surcharge Management and Control” 5 Features cont’d: – Financial • Direct to invoice • Recorded in specific GL Account • Taxable or non-taxable • Optionally discounted based on payment terms discounts • Options for invoicing: – Add to trailer – Add to Item Price – Calculate and show (no charge) • Options for pricing: – – QAD Proprietary Base Charge Amount per UM over Min Amount per UM Combined

Trailer Codes QAD Proprietary

Surcharge Terms QAD Proprietary

Surcharge Class QAD Proprietary

Surcharge Zone QAD Proprietary

Surcharge List QAD Proprietary

Surcharge Rate QAD Proprietary

Customer Assignment QAD Proprietary

Item Assignment QAD Proprietary

Order Entry (discrete) QAD Proprietary

Order Entry (schedule) QAD Proprietary

Standard Shipments QAD Proprietary

Enhanced Shipping QAD Proprietary

Invoicing 5 Invoicing flow is not impacted by this process. 5 Should manual adjustments be required to the invoice based on errors in calculation, use Pending Invoice Maintenance to recalculate or adjust the trailer amounts. 5 Select Calc Surcharges option in PI Maintenance to have the system recalculate the surcharges based on the updated List information, or manually adjust the amount in the trailer code. . QAD Proprietary

Setup Considerations – Trailer codes (2. 9. 13) for tracking surcharges to specific GL accounts – Surcharge List (2. 20. 1), Class (2. 20. 7), Zone (2. 20. 4), Rates (2. 20. 10), Terms (2. 20. 13) – Customer linkage to List, 2. 1. 1 – Item linkage to class, 1. 4. 5 – Item ship weight and UM (pt_ship_wt and pt_ship_wt_um), can be other than LBs for creative calculation, i. e. fuel or other surcharge – Screen labels, menus and field name changes, change, hide, default, configure screens and field security (Labels - 36. 4. 17. 5, menus 36. 4. 4, Message Maintenance 36. 4. 7, error message 669). These elements must be considered as a part of any upgrade plans, as these changes will not be carried into the new upgraded instance. QAD Proprietary