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Umoja Logistics Overview (Inbound Goods Process): PK & SPM – Version 17 Last Modified: 01-August-13
SC112 – Umoja Logistics Overview (Inbound Goods Process):
PK & SPM
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Agenda
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Course Introduction
Module 1: Umoja Logistics (Inbound Goods Process)
Course Summary
Course Assessment
Course Survey
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Course Overview
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The purpose of the Umoja Logistics Overview course is to introduce the Inbound Goods process for DFS-supported missions.
This is an interim process applicable to Peacekeeping and Special Political Missions during the period of coexistence of the Umoja and Galileo systems, for activities performed when receiving goods from commodity vendors.
Prerequisite Review
You should have completed the following prerequisite courses:
• Umoja Overview
• Umoja Master Data & Coding Block Overview
Course Duration: 1 hour and 30 minutes
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Course Objectives
After completing this course, you will be able to:
• Describe the high-level Inbound Goods process in Umoja
• Identify the key roles and responsibilities in the Inbound Goods process
• Describe the ways in which the Umoja implementation changes the Inbound Goods process
• Explain the difference between a virtual and a physical Goods Receipt
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Agenda
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Course Introduction
Module 1: Umoja Logistics (Inbound Goods Process)
Course Summary
Course Assessment
Course Survey
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Key Terminology
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Key Term Description
International Public Sector Accounting Standards (IPSAS)
A set of accounting standards issued by the IPSAS board for use by public sector entities around the world in the preparation of financial statements
International Commercial terms (Incoterms)
A series of pre-defined commercial terms published by the International Chamber of Commerce (ICC) widely used in international commercial transactions. These three-letter trade terms are related to common contractual sales practices. Incoterms help in clearly communicating the tasks, costs and risks associated with the transportation and delivery of goods
Purchase Order (PO) A buyer-generated document that authorizes a purchase transaction
Invoice A vendor-generated document that indicates the products, quantities and agreed prices for products delivered by the vendor
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Key Terminology
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Key Term Description
Goods Receipt A document generated to acknowledge receipt of goods, against an inbound delivery, conducted at the point of “first receipt” or transfer of ownership
Low Value Acquisition
A Purchase Order (PO) used for requirements that are up to $4000 USD issued without the direct involvement of Procurement. This replaces the Short PO process
Three-Way Matching
The comparison of quantities, price per unit, terms etc. appearing on the vendor’s invoice with the information on the PO and the Goods Receipt. This is done through the Logistics Invoice Verification (LIV) process
Inbound Delivery A document containing key delivery data required for triggering and monitoring the inbound movement of goods to the mission area. This is similar to an Advanced Shipping Notice (ASN)
Movement Type A three-character field in the Umoja ECC system to describe the type of material movement that needs to be performed. It is used for all types of goods movement in Umoja such as receipts and reversals
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Key Terminology
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Key Term Description
Virtual Goods Receipt
A Goods Receipt posted in Umoja when the terms of a contract specify that the delivery of goods by a commodity vendor to UN occur at a named place of delivery other than the final destination
Physical Goods Receipt
A Goods Receipt posted in Umoja when the terms of a contract specify that the delivery of goods by a vendor to UN occur at the intended mission destination
Material Master
A Master Data record that contains information about all products procured, stored and shipped by UN. For example, Product ID, Product Category, Material Management and other physical or financial characteristics
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Roles & Responsibilities
The following Umoja Enterprise roles are involved in the Umoja Logistics process:
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Inbound Coordinator
• Updates information about inbound movement of goods to the mission based on information provided by the commodity vendors and freight providers
• Manages the information flow to indicate the transfer of ownership
• Enables downstream operations to be optimized through provision of shipment/movement information
• Cannot execute virtual or physical Goods Receipts transactions in Umoja
Note: Role definitions have been modified for this interim process.
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Roles & Responsibilities
The following Umoja Enterprise roles are involved in the Umoja Logistics process:
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Virtual Receiving User
• Receives goods against commercial procurement during the Virtual Goods Receipt process
• Indicates UN’s acceptance of goods during transfer of ownership, in accordance with the Incoterm
Note: Role definitions have been modified for this interim process.
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Roles & Responsibilities
The following Umoja Enterprise roles are involved in the Umoja Logistics process:
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Receiving User
• Receives goods against commercial procurement during the Physical Goods Receipt process
• Indicates UN’s acceptance of goods during transfer of ownership, in accordance with the Incoterm
Note: Role definitions have been modified for this interim process.
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The Umoja Logistics Overview course introduces the Inbound Goods process for DFS-supported missions that is being implemented during the period of coexistence of the Umoja and Galileo systems, performed when receiving goods from commodity vendors.
• Inherent in this process is the tracking of inbound goods movement and, upon receipt, basic verification to affirm that goods being received conform to the Purchase Order (PO)/contract
• Goods received from internal transfers, such as inter/intra-mission transfers and Strategic Deployment Stock transfers, are received and managed through the current business process in Galileo
• Receipt of services is a different process and is introduced in the Service Receipt Process course
Introduction to Umoja Logistics: Inbound Goods Process
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Inbound Processing
Umoja Goods Receipt
Galileo Goods Receipt and
Inventory Management*
Note: *Galileo Goods Receipt and Inventory Management is not performed in Umoja.
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Umoja Logistics Benefits
Material Master is shared across Procurement and Logistics through one global Material Master Record, ensuring consistent and accurate data. The material procured is similar to the one received and managed in the inventory.
Goods Receipt is conducted in the same system where Procurement and Financial activities take place. This results in reduction of discrepancies and timely execution of payments.
Standardization of the Inbound process across the Secretariat, inline with the industry best practices. Enhanced visibility on expected deliveries, enabling better planning and reduced needs for additional communications such as phone calls and emails.
IPSAS compliance regarding transfer of ownership (example: virtual receipt of goods that are freight forwarded).
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The benefits of Umoja Logistics are:
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Current State with Legacy Systems
With the implementation of Umoja, several legacy systems are to be replaced as Umoja rolls out to locations. Within Supply Chain/Procurement/Logistics, the diagram below represents the current state.
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Mercury
Sun
IMIS HQ ProcurePlus
CATS (Contract
Administration Tracking System)
Galileo Assets/Inventory
Automated Interfaces
Manual Data Updates/Uploads
Systems Will Continue to Exist
Systems to be Replaced
Automated Interfaces
UNGM
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Future State Until Decommission of Galileo
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Within Supply Chain/Procurement/Logistics, here is how the Umoja system will interact with other systems (before the decommission of Galileo).
UMOJA
(Replaces SUN, Mercury, ProcurePlus and IMIS for
payment)
UNGM
Automated Interfaces
Manual Data Updates/Uploads
Newly Linked System
Umoja System Automated Interfaces
CATS (Contract
Administration Tracking System)
Galileo Assets/Inventory
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Coexistence of Umoja and Galileo
The Umoja system will ultimately replace the Galileo system. However, due to the provisional retention of Galileo, the two systems will coexist.
In effect, all goods from vendors are received in a two-step process.
The information being transferred to Galileo depends on the attributes of the goods as defined by the Material Master in Umoja. For example, items that need to be serialized are flagged from Umoja and categorized as Non-Expendables in Galileo.
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Automated one-way data transfer passes details of the Goods
Receipt, including PO information
Umoja System
Goods are first received in the Umoja ECC and treated as “consumed” (not held for inventory), for accounting and invoice payment purposes
Then, the Receiving and Inventory Management process continues as per the current business process
Galileo System
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Coexistence of Umoja ECC and Galileo
Galileo remains as a financial reporting and inventory management tool.
Umoja provides a complete equipment and inventory management solution, which will be implemented in further rollouts of the Umoja functionality for Peacekeeping. It will provide additional functionality in the receiving process, including:
• Serial number creation
• Barcode printing
• Batch management/creation
• Quality inspection
However, while Galileo is retained, these functions are not implemented for Peacekeeping locations.
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Umoja ECC Output into Galileo
When goods are first received in Umoja ECC, relevant material and procurement data flows into Galileo to pre-populate fields allowing for a faster receiving process in Galileo.
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Umoja ECC Galileo
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What’s Changing?
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With the implementation of Umoja, several business processes are changing:
• System Integration
• Financial Implications
• Inbound Delivery Process
• Virtual vs. Physical Goods Receipt
Note: These processes are governed by IPSAS/OPPBA guidelines/procedures and documented in publications, such as the Procurement Manual, DFS Property Management Manual and other policies issued by UN.
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What’s Changing?
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• Umoja links Procurement, Logistics and Finance functions. These functions share the Material Master Data through one global material record
• Users have access to the same information through one integrated system
• PO’s, Goods Receipts and Invoices share the same information, eliminating data re-entry
• The Umoja/Galileo interface will pre-populate relevant PO details and assist in completing the downstream processes in Galileo
• Goods acquisitions through the Low Value Acquisition (LVA) process need to be "received" by a Receiving User in Umoja (i.e. R&I) in order to pay the invoice
System Integration
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Procurement
Logistics
Finance
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The Material Master Data is a Master Data record that contains information about all products procured, stored and shipped by UN. It determines how the material will be managed from the requisitioning to downstream processes.
Key components of Material Master Data include:
What’s Changing? Material Master
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Material Master
Data Objects
Unique ID of a product or service
Type of product or service Matches the equivalent UNSPSC
classification
Characteristics to enable Material Management
Other physical or financial characteristics
Material Management Characteristics
Product Category
Product ID
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What’s Changing?
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• Umoja ECC’s three-way matching functionality enables automated cross-check of PO, Goods Receipt and Invoice:
– If the documents cannot be matched, the system automatically blocks the payment
– If the documents do match, payments are cleared for processing, according to payment terms
• If physical discrepancies (example: damage) are found during Goods Receipt, a “blocked” status can be placed on the goods, resulting in no financial posting
Financial Implications
Invoice
Goods Receipt
Purchase Order
Umoja ECC
Umoja ECC performs three-way matching
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Umoja ECC’s three-way match functionalities allows the comparison of quantities, price per unit, terms etc. appearing on the vendor’s invoice, with the information on the PO and Goods Receipt.
What’s Changing? – Three-way Match
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Purchase Order Goods Receipt Invoice
Item 1 Material: -------- Quantity: -------- Item 2 Material: -------- Quantity: -------- Contract terms
Item 1 Material: -------- Quantity: -------- Item 2 Material: -------- Quantity: -------- Contract terms
Item 1 Material: -------- Quantity: -------- Item 2 Material: -------- Quantity: -------- Contract terms
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What’s Changing? – Inbound Delivery
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• Umoja introduces the concept of inbound delivery, which is a system-generated document used to update delivery details (similar to an Advanced Shipping Notice provided by freight forwarders or vendors)
• The Inbound Delivery process provides visibility of the shipment status to all stakeholders (i.e. Procurement, R&I and Requisitioner amongst others). It is created against a PO and updated by the Inbound Coordinator with shipment information and documentation (e.g. Bill of Lading), as they become available
• Vendor shipment information is now accessible by the receiving mission within the same procurement system. The update of inbound deliveries will provide delivery dates and corresponding shipment information and documentation to receivers
• The Inbound Coordinator is responsible for all processes related to the inbound delivery
Inbound Delivery Process
Inbound Processing
Umoja Goods Receipt
Galileo Goods Receipt
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What’s Changing?
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• Goods Receipt is conducted at the point of “first receipt” or transfer of ownership, in accordance with the contractual Incoterms. This is the criteria used to distinguish between a virtual goods receipt and a physical goods receipt
• Virtual goods receipts do not have an inspection step before the payment is cleared for processing
• Umoja ECC uses “movement types” to execute the taken receiving actions
Virtual and Physical Goods Receipt
Inbound Processing
Umoja Goods Receipt
Galileo Goods Receipt
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How is Receiving Done in Umoja ECC?
Now that we’ve seen the changes Umoja ECC is bringing, the following section contains information on how the Goods Receipt process is performed in Umoja ECC.
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Virtual and Physical Receipt for Common UN Incoterms
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The transfer of ownership that occurs between the seller and buyer is dictated by the Incoterm. Thus, a virtual goods receipt can occur at any location prior to the final receiving UN location. Incoterms 2010 commonly used by UN are depicted:
UN EXW
FCA Seller UN
Seller UN FOB
Seller
DAP Seller
DDP
Seller UN DAT
Point of Origin UN Location Onboard Vessel Port Port
Virtual Receipt
Physical Receipt
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What is a Virtual Goods Receipt?
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IPSAS requires goods to be received at the point of transfer in ownership from the commodity vendor to UN, as dictated by the appropriate Incoterms. This can occur before goods are physically received by the mission, for example when they are placed at the disposal of a UN-designated freight forwarder. In Umoja, this is considered a virtual goods receipt.
Within the virtual goods receipt process:
• Inbound deliveries are updated with relevant information provided by commodity vendor to confirm delivery of goods
• The Virtual Receiving User then receives the goods against the inbound delivery
• Umoja ECC will automatically perform a three-way match and clear the payment for processing
Virtual Goods Receipt
Vendor Delivers at Origin or Other Named Place (e.g. Port of Delivery) Vendor Delivers at Destination
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Incoterms Applicable for Virtual Goods Receipt
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Incoterms:
• EXW – Ex Works
• FAS – Free Alongside Ship
• FCA – Free Carrier
• FOB – Free on Board
• DAT – Delivered at Terminal
• CFR – Cost and Freight
• CIF – Cost, Insurance and Freight
• CIP – Carriage and Insurance Paid To
• CPT – Carriage Paid To
Virtual Goods Receipt
Vendor Delivers at Origin or Other Named Place (e.g. Port of Delivery) Vendor Delivers at Destination
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What is a Physical Goods Receipt?
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Physical goods receipt refers to the process where commodity vendors deliver directly to the mission location, as dictated by the appropriate Incoterms.
Within the physical goods receipt process:
• The Receiving User receives the goods against the inbound delivery in Umoja
• For a standard goods receipt, Umoja ECC will automatically perform a three-way match and clear the payment for processing
• If discrepancies are found, goods can be moved to a “blocked” status and the invoice for payment cannot be paid until resolved
• Requisitioners are notified by a system-generated email upon goods receipt (under deliveries and “blocked” goods are indicated)
Physical Goods Receipt
Vendor Delivers at Origin or Other Named Place (e.g. Port of Delivery) Vendor Delivers at Destination
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Incoterms Applicable for Physical Goods Receipt
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Incoterms:
• DAP – Delivered at Place
• DDP – Delivered Duty Paid
• DDU (Removed from 2010 Incoterms)
Physical Goods Receipt
Vendor Delivers at Origin or Other Named Place (e.g. Port of Delivery) Vendor Delivers at Destination
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Umoja ECC uses movement types to execute the receiving actions taken. When a movement type is used, goods are received to a certain stock type.
A stock type defines the system state that classifies goods. Stock types used in Umoja:
Umoja ECC Stock Type
Material available for use upon receipt:
• This stock type allows full financial posting and invoice processing
Unrestricted Stock
Material not available for use upon receipt:
• Should only be used in exceptional cases
• Used when goods are clearly damaged or have different specifications from the PO
• Upon receipt of such goods, UN will not accept ownership until resolution is reached with vendor
• This stock type blocks full financial posting and invoice processing
Blocked Stock
Note: Since inventory or “stock” is not managed in Umoja in this interim process, the purpose of a stock type is to determine financial posting and invoice processing.
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Movement Types for Virtual Goods Receipt
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• Goods receipt performed in Umoja ECC prior to the arrival of the goods in the receiving location
• Goods are always received to Unrestricted Stock
• Inspection is not conducted in Umoja ECC
• Full financial posting
• Invoice processing
• Three-way match
Virtual Goods Receipt to Unrestricted Stock
Description
Financial Implication
The following movement types are used for virtual goods receipt:
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Movement Types for Physical Goods Receipt
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• Goods receipt performed when goods are delivered and first received at the intended mission destination (standard goods receipt)
• Full financial posting
• Invoice processing
• Three-way match
Goods Receipt to Unrestricted Stock
Description
Financial Implication
The following movement types are used for physical goods receipt:
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Movement Types for Physical Goods Receipt
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• Used in exceptional cases, when goods are clearly damaged or have different specifications from the PO, thereby prohibiting UN from taking ownership of the goods
• No posting in Galileo
• No financial posting
• No invoice processing
Goods Receipt to Blocked Stock
Description
Financial Implication
The following movement types are used for physical goods receipt:
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Movement Types for Physical Goods Receipt
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• Discrepancies with goods are resolved offline, released to Unrestricted Stock
• Full financial posting
• Invoice processing
• Three-way match
Release Blocked Stock
Description
Financial Implication
The following movement types are used for physical goods receipt:
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Movement Types for Physical Goods Receipt
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• Goods receipt due to error or other valid reasons (not including return to vendor)
• Varies depending on receipt movement type
Reversal of Goods Receipt
Description
Financial Implication
The following movement types are used for physical goods receipt:
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Movement Types for Physical Goods Receipt
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• Goods need to be returned to vendor
• Varies depending on receipt movement type
Description
Financial Implication
The following movement types are used for physical goods receipt:
Return to Vendor
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Putting it Together: Goods Procurement
The steps for performing a virtual or physical goods receipt are summarized below:
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Galileo Interface Continue Receiving Process in Galileo
Virtual Goods Receipt Physical Goods Receipt
Inbound Coordinator Inbound Delivery Update
Virtual Receiving User Virtual Receipt
Vendor delivers at origin or other named place
Inbound Coordinator Check Delivery Documents
Vendor provides delivery update
Inbound Coordinator Inbound Delivery Update
Virtual Receiving User Check Delivery Documents
Receiving User Check for Discrepancy
Receiving User Physical Receipt
Inbound Coordinator Inbound Delivery Update
Vendor provides delivery update
Vendor delivers at destination
Receiving User Check Delivery Documents
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Specifically for the Receiving User, the following decision needs to be made when the goods arrive at the receiving mission location.
Putting it Together: Receiving User Decision
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Have the goods already been received in Umoja ECC?
This means a virtual goods receipt was already done
I only need to receive the goods in Galileo
This means I need to do a physical goods receipt
I need to receive the goods in Umoja ECC, using the correct movement type
Then, I need to receive the goods in Galileo
Yes
No
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Reports
There are several key reports used across the Umoja Logistics process. Some are introduced in this course, while others are detailed in the Level 3 course.
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The user generates a daily report that displays all inbound deliveries at the mission/location. This provides delivery dates and corresponding shipment information/documentation.
Inbound Delivery Report
The user can generate a list of material documents (Goods Receipts) that have been posted by material or multiple materials. From the output list, the user can search for and display a particular material document.
Material Document Report
The user can generate a list of PO’s by PO number for a mission/location. This allows the user to find the status/details of a particular PO. Other variations of this report allow views (for example, by vendor or by material).
Purchase Order Report
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Learning Checkpoint 1
When goods are placed at the disposal of a UN-designated freight forwarder, which tasks are performed by the Virtual Receiving User in Umoja?
Select the correct option.
A. Virtually receive goods to indicate transfer of ownership to UN
B. Barcode and update received batches, as applicable
C. Perform a quality inspection of materials
D. Create inbound delivery
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Learning Checkpoint 1
When goods are placed at the disposal of a UN-designated freight forwarder, which tasks are performed by the Virtual Receiving User in Umoja?
Select the correct option.
A. Virtually receive goods to indicate transfer of ownership to UN
B. Barcode and update received batches, as applicable
C. Perform a quality inspection of materials
D. Create inbound delivery
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Option A is correct. The Virtual Receiving User virtually receives the goods to indicate transfer of ownership to UN.
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Learning Checkpoint 2
Which documents are cross checked during the three-way match?
Select the correct option.
A. Inbound Delivery, Sales Order and Goods Receipt
B. Inbound Delivery, Purchase Order and Invoice
C. Purchase Order, Sales Order and Goods Receipt
D. Purchase Order, Invoice and Goods Receipt
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Learning Checkpoint 2
Which documents are cross checked during the three-way match?
Select the correct option.
A. Inbound Delivery, Sales Order and Goods Receipt
B. Inbound Delivery, Purchase Order and Invoice
C. Purchase Order, Sales Order and Goods Receipt
D. Purchase Order, Invoice and Goods Receipt
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Option D is correct. Three-way match cross checks the PO, Invoice and Goods Receipt.
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Agenda
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Course Introduction
Module 1: Umoja Logistics (Inbound Goods Process)
Course Summary
Course Assessment
Course Survey
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Course Summary
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The key points covered in this course are listed below:
• The Inbounds Goods process involves the tracking of inbound goods movement and, upon receipt, basic verification to affirm that goods being received conform to the PO/contract
• The Umoja system will ultimately replace the Galileo system. However, due to the provisional retention of Galileo, the two systems will coexist
• Umoja ECC’s three-way match functionality allows the comparison of quantities, price per unit, terms etc. appearing on the vendor’s invoice, with the information on the PO and Goods Receipt
• Umoja introduces the concept of inbound delivery, which is a system-generated document used to update delivery details
• Inbound delivery process provides visibility of the shipment status to all stakeholders
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Agenda
48 Copyright © United Nations
Course Introduction
Module 1: Umoja Logistics (Inbound Goods Process)
Course Summary
Course Assessment
Course Survey
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Course Assessment
Now that you have completed all the modules in this course, you can test your knowledge by completing the Course Assessment.
To receive credit for completing this course, you must pass this assessment with a minimum score of 90%.
To complete the assessment you must return to the Learning Management System:
1. Log into Inspira
2. Navigate to Main Menu -> Self-Service -> Learning -> My Learning
3. Search for the name of the course under the My Learning Activities section
4. Click on the Start link of the course assessment
5. Click the Submit button once you have completed the assessment
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Agenda
50 Copyright © United Nations
Course Introduction
Module 1: Umoja Logistics (Inbound Goods Process)
Course Summary
Course Assessment
Course Survey
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Course Survey
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Your feedback is important to the continuous improvement of our training program.
Please complete the evaluation for this course using the following steps:
1. Log into Inspira
2. Navigate to Main Menu -> Self-Service -> Learning -> My Learning
3. Search for the name of the course under the My Learning Activities section
4. Click on the Start link of the course survey
5. Click the Submit button once you have completed the course survey
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Congratulations! You have successfully completed the
Umoja Logistics Overview (Inbound Goods Process): PK & SPM course.
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