In MRO, the interim order structure provides the user with a means to estimate the feasibility of the overhaul before disassembly ever begins. The costing information - estimated costs before execution has begun and actual costs thereafter - helps you to determine whether prices associated with the service agreement will generate an internal profit or loss. As repair interim orders are connected to the interim order structure, or as work scope changes occur, for example specifying a different maintenance level, the estimated costs will change.
Once the supply shop orders have been released and reporting on disassembly has occurred, you can also calculate actual costs. The cumulative costs for the interim order structure are calculated using a conventional cost rollup for both disassembly and assembly structures based on the cost bucket definitions.
Both the estimated and actual costs are shown by manufacturing level and accumulated by part. The variances between estimated and actual for level and accumulated cost are also shown. The costs are broken out by cost bucket, with a sum total. The summation provides an overview of the costs and variances for the entire interim order structure.
The interim order structure for which costs are being calculated cannot be in Canceled or Closed state. In addition, for Actual Cost but not Estimated Cost calculations, at least some of the interim orders in the order structure must be released and and have operations reported on their corresponding supply shop orders. Work center costs must have been defined. Parts must have been assigned to proper cost templates and cost buckets.
Costs will be calculated for each level, considering operation costs from the MRO Interim Order/Operations tab since changes could have been made from the original routing used. If shop orders have been created, the estimated cost calculation picks up costs from the pegged shop orders instead of calculating level costs using the order structure. This calculation is frozen when the shop orders reach the Started state. The system will use the cost template ID for the parts and the template's associated cost buckets. If the part ownership for a component line is specified as Customer Owned or Supplier Loaned, or the supply code is Maintenance Repair and Overhaul, no material cost will be calculated but machine and labor costs will be calculated.
Orders related to the order structure will accumulate costs during shop order execution. Once execution costs have been created, the actual costs for an order structure can be rolled up. A shop order component line that is specified as either Customer Owned or Supplier Loaned will not add any cost to the actual cost. If the supply code of the shop order component line is Maintenance Repair and Overhaul, there will be no cost contribution to the actual cost. The actual cost calculation uses the reported machine and labor time in the shop order. It is recommended that you perform the actual cost calculation when all the shop orders have been closed.