## Understanding Lot Processing

This chapter discusses:

- Lot processing

- Lot creation

- Lot status

- Grade and potency

### Lot Processing

Lot processing enables you to manage information about groups of items. For example, for groups of perishable items, you can have the system assign lot numbers based on receipt dates that identify the items that you must sell first. You can view current information about each lot, such as the quantity of available items and the transactions that have affected the lot.

Lot control is beneficial for identifying groups of items that are components of a final product. For example, if you assign lot numbers to both bicycle tires and bicycles assembled from the tires, you can:

- Identify the lot number for the tires that were used in the manufacture of a specific bicycle.

- Identify all bicycles that used tires from a specific lot.

If you later find that a particular lot of tires is defective, you can immediately identify and recall all bicycles that drew from the lot of defective tires.

A lot usually contains one type of item, but you can set up system constants in the Branch/Plants Constants program (P41001) to allow different types of items in the same lot. When a lot contains different items, the system maintains lot information for each lot number and item. You can also set up system constants to restrict a lot to one type of item and still allow that lot to exist in multiple warehouses.

In manufacturing, you can complete items in multiple lots in inventory from a single work order. When you report multiple lot completions, the system links materials issued to the work order to the completed items by lot number. If you do not have a lot number for the end item by the time that you issue component materials, the system uses only the work order number to link the components to the end item.

The system enables you to define multiple dates that are relevant for lot processing. These dates can be used to determine when lot-controlled items become available. For each lot containing a lot-controlled item, you can define these availability dates based on the information that is set up for the item in the Item Master (P4101) and the Item Branch/Plant (P41026) programs:

- Lot expiration date.

- On-hand date.

- Best-before date.

- Sell-by date.

- Lot effectivity date.

- Based-on date.

- User lot dates 1 through 5.

You can use the lot expiration date, the sell-by date, and the best-before date, as well as the user-defined lot dates, to define the commitment date method.

Expiration planning considers the expiration dates of lots while calculating the on-hand quantity and consumes the lot quantities in the order of expiration dates. That is, lots with the most current expiration dates are consumed first. This is the first-in, first-out (FIFO) method. Expiration planning is important because whoever in the chain has possession of the product when it expires incurs the loss. Accurate planning, forecasting, and adherence to schedules are important to expiration planning because products must make it through the entire chain from the supplier and, finally, to the customer before the expiration date. If any party in the chain does not adhere to the schedule, at least one party incurs a loss.

By using the lot effectivity date, you can define a lot to become available for use at a future date. You can calculate the effective date for the lot manually or automatically when the lot is created and becomes on-hand. You can use the Manufacturing Effective Days field on the Item Master Revisions form or the Item Branch/Plant Info form to define the number of days before which a lot will be effective.

When you set the appropriate processing options, JD Edwards EnterpriseOne Manufacturing Planning systems perform these actions:

- Deduct expired quantities of items from the on-hand values.

- Send a warning message that is recorded in the MPS/MRP/DRP Message File table (F3411).

- Adjust the time series to reflect the expired product's effect.

You can use several methods to assign lot numbers to items. For example, you can use one of these methods:

- Have the system assign lot numbers.

- Assign user-defined lot numbers.

- Assign supplier lot numbers.

See Also

Defining System Constants

Setting Up Dates for Lots

Entering Lot Date Information

Defining Effective Dates for Future Availability

### Lot Creation

You can create lots automatically or manually. Lots are generated automatically when you perform any of these tasks:

- Create purchase order receipts.

- Complete work orders.

- Adjust inventory.

You can create lots manually, by accessing the Lot Master Revisions program (P4108) either directly from the menu or during work order entry from the Work Order Details form. Each time that you create a lot, the system adds a record to the Lot Master table (F4108).

The actual grade and potency of a lot is defined in the Lot Master table. You also use the Lot Master Revisions program to specify a reason code for a grade or potency change. In addition, you can use processing options to protect a grade or potency from being updated.

Lot master information includes the status and availability dates for the lot. You can also define grade and potency for a lot and specify a reason code for a grade or potency change. In addition, you can use processing options to protect a grade or potency from being updated.

See Also

Entering Lot Information

### Lot Status

The status of a lot determines whether it is available for the system to process. When a lot is on hold for any reason, the system does not process it unless you activate a processing option that enables processing of held lots.

You set up lot status codes to identify reasons that a lot can be put on hold. After you set up the codes, you can assign them to items and lots.

You set up lot status codes in the user-defined code (UDC) table 41/L (Lot Status Codes) by using the User Defined Codes program (P0004A). You assign status codes to different lot locations in the Lot Master Revisions program (P4108). You can assign different status codes to a single lot based on the different locations in which the lot resides. When assigning a lot status, you can use the status code from the lot's record in the Lot Master table (F4108) or the default status from the Item Branch File table (F4102) if no lot status exists.

You can run the Lot Status Update program (R41082) to place expired lots on hold. You can run the program in proof or final mode. If you run the program in proof mode, you can produce a report showing all lots that will be put on hold. If you run the program in final mode, you can produce a report showing all lots that have been put on hold. You assign lot statuses when you:

- Enter a new lot using the Lot Master Revisions form. If you do not enter a status at this time, the system uses the lot status from the item's branch information in the Item Branch File table.

- Set up a new location for an item using the Item Branch/Plant program (P41026).

You can assign lot statuses to different lot locations using the Location Lot Status Update form from the Lot Master Revisions program. When you create a lot through transfer from another location, the system assigns statuses, using the status code of the From location. You can assign status codes to locations without using lots. Whether the system processes items that reside in locations that are on hold depends on how you set the processing options.

Use these tables to determine the lot status for newly created records in the Lot Master table and the Item Location File table (F4108):

Table | Description
Lot Master (F4108) | If you enter a lot status on the Lot Master Revisions form, the system uses that lot status. If you do not enter a lot status, the system uses the default lot status from the Item Branch File table.
Item Location File (F41021) | If you enter a lot status on the Lot Master Revisions form, the system uses that lot status. If you are moving a lot from another location, the system uses this sequence to assign a lot status: The default lot status from the From location. If a lot number exists, the lot status from the Lot Master record. If no lot number exists, the default lot status from the Item Branch File table.

See Also

Assigning Lot Status Codes

### Grade and Potency

This section discusses:

- Grade and potency qualifications.

- Grade and potency control.

- Lot and serial control items.

#### Grade and Potency Qualifications

Manufacturers in the process industry need full control over the quality of products that they make or buy. Examples of process industries include the food, chemical, and pharmaceutical industries. Grade and potency qualifications enable you to categorize products more specifically and trace their movement through the manufacturing and distribution processes.

Grade identifies the particular specification makeup of an item and enables the system to separate one lot from other production lots without changing the item number. Examples of items that have grades are diamonds, lumber, and raw turquoise. Potency refers to the percentage of active ingredient within a solution, such as a 40 percent solution of hydrochloric acid, 3.2 beer versus beer with standard percentages of alcohol, and coffee with varying amounts of caffeine.

In the JD Edwards EnterpriseOne systems, grade and potency are mutually exclusive. You can use only one or the other to categorize an item. All items that are grade- or potency-controlled must also be tracked by lot number. Grades and potencies divide items by their specific makeup or characteristics without changing item numbers. Programs that calculate on-hand and available quantities use the grade or potency for each lot.

For grade- and potency-controlled items, you can enter a standard (preferred) value for each item. You can also enter a range of acceptable values that enable you to continue operations with grades or potencies that are outside of the standard value, but are still acceptable for use. A range helps to establish and maintain quality levels in products, but is flexible enough to keep operations running when the standard level of product is unavailable. The system records grade or potency and lot transfer transactions in the item ledger and the general ledger, so that accounting is incorporated into the tracking.

Only items that meet the grade or potency range requirements stated in the bill of material are issued to the shop floor for production. Components that are outside of the range do not appear as available or on-hand in material inquiries for JD Edwards EnterpriseOne Shop Floor Management. You can order only a certain grade or potency of an item. Sales order and purchase order systems accommodate grade and potency standards and ranges.

#### Grade and Potency Control

You set up grade- or potency-control fields on the Grade and Potency tab of the Additional System Information form in the Item Master program (P4101). This table describes the control field values that the system uses when you create a branch/plant record for an item:

Control Field | Description
Grade/Potency Pricing | Determines how to price grade- or potency-controlled items in JD Edwards EnterpriseOne Sales Order Management.
Potency Control | Identifies whether the item is potency-controlled.
Grade Control | Identifies whether the item is grade-controlled.
Standard Potency | Identifies the standard percentage of active ingredients that are normally found in an item. The value that you enter provides the default value for several forms in the JD Edwards EnterpriseOne Manufacturing systems. In certain cases, the potency standard is used for the potent unit of measure conversion.
Standard Grade | Identifies the standard grade of the item, such as premium or average. The value that you enter provides the default value for several forms in JD Edwards EnterpriseOne Manufacturing systems.
From and Through Potency | Defines the allowable potency ranges for an item.
From and Through Grade | Defines the allowable grade ranges for an item.

Defining the values for grade, potent units of measure, and conversions for potent units of measure includes:

- Defining the values in UDC 40/LG (Lot Grade) for the grades that you will use.

- Defining the values in UDC 00/UM (Unit of Measure) for the potent units of measure.

  For each potent unit of measure that you define, you must type P in the second space of the Special Handling Code field on the User Defined Codes form.

- Defining a conversion for each potent unit of measure to a physical unit of measure in the Standard Units of Measure program (P41003).

  For example, 100 gallons of a solution at 80 percent potency equals 80 potent gallons, and 80 potent gallons of a solution at 80 percent equals 100 gallons.

See Also

Setting Up Manufacturing Information

#### Lot and Serial Control Items

Grade- and potency-controlled items must be lot-controlled. Use the Item Branch/Plant program (P41026) to identify an item as a lot- or serial-controlled item by entering one of these values in the Lot Process Type field:

Value | Description
Blank | Lot assignment is optional. Numbers must be manually assigned. Quantity can be greater than one.
1 | Lot assignment is used. Numbers are assigned by the system using the system date in YYMMDD format. Quantity can be greater than one.
2 | Lot assignment is used. Numbers are assigned in ascending sequence using next numbers. Quantity can be greater than one.
3 | Lot assignment is required. Numbers must be manually assigned. Quantity can be greater than one.
4 | Serial number assignment is optional except during shipment confirmation. Quantity must not exceed 1.
5 | Serial number assignment is required. The system assigns numbers using the system date in YYMMDD format. Quantity must not exceed 1.
6 | Serial number assignment is required. The system assigns numbers in ascending order using next numbers. Quantity must not exceed 1.
7 | Serial number assignment is required. You must manually assign numbers. Quantity must not exceed 1.

When you attach a parts list to a work order header, the system creates commitments for the components. How these commitments are created depends on the parameters of commitment method, commitment control, and hard- or soft-commit. After you set up these parameters, commitments can be created in the same manner using both the Enter/Change Order (P48013) and Order Processing (R31410) programs.

When an item is defined as lot-controlled, the system moves the grade or potency range to the parts list and allows only those lots within the range to be eligible for commitments. Any remaining quantities are committed to the primary location.