modern supply chain planning - inspirage
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1ConfidentialConfidential
Ludwig AvontsLead Solution Consultant ERP/SCM
Modern Supply Chain PlanningManaging the Financial Consequences of
Cross-Border Material Flows
Copyright © 2018, Oracle and/or its affiliates. All rights reserved. |
The Challenge
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Global Companies Are…
• Optimizing the physical supply chain
(e.g. Centralized Planning Function, ABC-Delivery)
• Optimizing VAT (e.g. Principal Business Model, Limited Risk Distributor)
A single physical movement of goods may involve multiple transfers of ownership
As a Result…
Physical Movement(Shipment, Receipt)
Financial Ownership(Orders, Invoices, Payments)
4
Shipment of GoodsAR Invoice
intercompanyAP Invoice
intercompany
AR Invoice
Sales Order
ABC - Delivery
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Limited Risk Distributor Model
Limited Risk Distributor
CustomerSale to Customer
Principal – VAT#Intercompany Sale
Shipment of Goods directly from Principal to customer, the LRD has “split second” ownership
Limited Risk Distributor
Customer
Customer Order
Order Confirmation
Customer Invoice
Principal – VAT#
Intercompany Order
Intercompany Invoice
Order Confirmation
Goods Issue directly to Customer
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Some Variations...
Limited Risk Distributor
CustomerSale to Customer
PrincipalIntercompany Sale
Shipment of Goods directly from third party to customer the principal & LRD have “split second” ownership
Third Party SupplierSame Country
Vendor Invoice
LRD – Country 2CustomerCountry 2
Sale to CustomerLRD – Country 1
Intra community transfer within legal entity
Shipment of Goods directly from third party to customer the principal & LRD have “split second” ownership
Principal Country 1
Intra-community Intercompany Invoice
Limited Risk Distributor
Customer Sale to Customer
PrincipalIntercompany Sale
Shipment of Goods directly from third party to customer the principal & LRD have “split second” ownership
Third Party SupplierOther EU country
Intra-community Vendor Invoice
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The ChallengeIntercompany Invoices &Related Tax Calculation
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The Solution
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Automatic Intercompany CreationModeling & Executing Your Tax Efficient Supply Chain in Oracle SCM Cloud
• Define configurable trade relationships -transfer pricing, intercompany documentation and ownership transfer points for profit center business units
• Create multi-node financial routes
Model Supply Chain Financial Flow
• Automate financial accounting within Oracle SCM Cloud
• Without interfering with the execution transactions
Separate Physical from Financial Transactions
• Monitor and audit financial orchestration transactions
Monitor & Report
Physical movement
Financial ownership
Supply Chain Financial Orchestration
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LocalPurchasing
Supported Scenarios
Warehouse
Global Supplier
Internal Transfer
Global Procurement
Global Sales Order Shipments(Internal Drop Ships)
Global Customer
Local Sales
Warehouse
Warehouse
Warehouse
Global Drop ShipGlobal Customer
Global Supplier
Physical route
Financial route
Local Sales
Copyright © 2018, Oracle and/or its affiliates. All rights reserved. |
Supported Scenarios
Warehouse Warehouse
Physical route
Financial route
LocalPurchasing
Global Supplier Warehouse
LocalPurchasing
Local Sales
Global CustomerLocal SalesWarehouse International
Company
Global Customer
Global Supplier Local Sales
LocalPurchasing
Copyright © 2018, Oracle and/or its affiliates. All rights reserved. |
Supply Chain Financial Orchestration Cloud
Physical Execution: Inventory, Manufacturing, Transportation
Financial Execution: Cost Accounting, Transfer Pricing, Interco Invoicing, Tax
Obligation/Money
Product costs and profitability
• Central financial orchestration tracking ownership and obligations
• Rule based Financial execution enables different financial treatment based on physical transactions
• Supply chain not held back due to any financial processes such as period close
• Rich audit trail on accounting transactions
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Order Management Procurement LogisticsProduct Master Data
ReceivingReceiptEvents
ShippingShipment
Events
InventoryTransferEvents
Model Financial Flows
Receive Supply Chain Events
Monitor and Manage Exceptions
IdentifyFinancial Flow
CalculateTransfer Price
GenerateOrchestration Tasks
Trade Events
IntercompanyAR Invoice
IntercompanyAP Invoice
Costing
Receivables
Payables
TAX ENGINE
Financial Orchestration Financials and Cost Mgt
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Supply Chain Flow
Financial Flow(s)
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Global Tax Needs
Competitive Advantage
Single Solution
Meets Tax needs, globally
Facilitates Global Operations,
Enables entry into newer markets
Across Procure to Pay, Order to Cash flows
Maximise ROIPayables ProjectsPurchasing Receivables
Central Application for Cloud Financials
Tax Configuration
Enforcement of Tax Legislation
Configuration and Transaction repository
Ensure Compliance
Compliance & Reporting
Single Source of Truth for
Configuration & Reporting
Minimises Compliance risk
Tax Record Repository
TaxConfiguration
Tax Calculations : Centralised Tax Engine
Quick start with Third Parties
Total FlexibilityPre Seeded Content
Common rules available for upload.
Additional content delivered by partners
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Tax Setup – Determining Factors – 4 Ps
Place
• Geography• User Defined Geography• Jurisdiction
Product
• Product - Inventory Linked• Product - Non-Inventory Linked• Transaction Input Factor• Product or Service
Party• Legal Party Fiscal Classification• Registration• Party Fiscal Classification• Transaction Input Factor
Process• Document• Transaction Fiscal Classification• Transaction Generic Classification • Accounting Event • Transaction Input Factor
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Parties
Places
Products
Processes
Tax TransactionsTaxes, Rules,
Rates
DetermineRegimes
TaxableBasis
CalculateTax
Amount
Tax Status& Rate
ApplicableTaxes
Single Interface for Transactions
Tax Reports- PDF, HTML, RTF
- Security enabled
Tax Calculation
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Office Depot Case Study
19
Key Facts
Industry : Business Supplies & Services
Owner : Private Equity
Turn-over : 1.3 Bln (margin business)Countries : 10+ (europe)Employee : 6.200HQ : Venlo, NL
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2020
Planning & Budgeting
(PBCS)
Financial Close & Consolidation
(FCCS)
Operational Systems Supply Chain Management
Financials Cloud
PurchasingCloud
(Indirect PO’s)
PurchasingCloud (Direct
PO’s)
PO’s
AP
GL
Fixed Assets
AR
Invoice Scanning & Matching
Tax Management
IntercompanyInvoices
Order Management
SO’s with intercompanyrequirement
Inventory(SFO)
Shipments
Banking Gateway
EDI
AccountingHub (AHCS)
Profitability & Cost Mgmt
(PCMCS)
Proposed Solution Architecture
Copyright © 2018, Oracle and/or its affiliates. All rights reserved. |
Ludwig AvontsLead Solution Consultant ERP/SCM
Modern Supply Chain PlanningManaging the Financial Consequences of
Cross-Border Material Flows