How to configure LCM(Landed Cost Management)

Setup steps for LCM configuration(After-Receiving Or LCM as Service)) On EBS R12.1.3

 LCM Setup Steps
First please apply Patches
17381106:R12.INL.B and
20720418:R12.INL.B
19660299:R12.AP.B

Step 1: Create New Account Code Example like as shown below:

Value Description Parent Qualifiers
8800 LCM Accounts Yes Yes,No,Liability,Yes,No
8801 LCM Absorption No Yes,Yes,Liability,No,No
8802 LCM Invoice Price Variance No Yes,Yes,Liability,No,No
8803 LCM Exchange Rate Variance No Yes,Yes,Liability,No,No
8804 LCM Tax Variance No Yes,Yes,Liability,No,No
8805 LCM Default Charge a/c No Yes,Yes,Liability,No,No
8806 LCM Cost Variance No Yes,Yes,Expense,Yes,No

Step 2: Define Child Range

Step 3: Set Profile Option as Follows

Profile Value Level

QP: Blind Discount Option Yes Application Level (Oracle Landed Cost Management)
QP: Licensed for Product Purchasing Application Level (Oracle Landed Cost Management)
QP: Pricing Perspective Request Type Purchase Order Application Level (Oracle Landed Cost Management)
INL: Allow Updates to Completed Yes Site
Shipments
QP: Pricing Transaction Entity Procurement at User
QP: Source System Code Oracle User
Purchasing
INL: Default Shipment Type for Open per your set up Site
Interface
INL: Volume UOM Class
INL: Quantity UOM Class
INL: Weight UOM Class
INL: Default Currency Conversion Type for Choose the functional currency or for others currencies,
QP Charges Generation a conversion rate should be recorded in
"Daily Rates"
form (Setup->Currency->Rates->Daily) using
Conversion Type
Step 4: Define Cost Factors
Oracle Purchasing-->Setup-->Purchasing-->Cost Factors-->Create

Create
Code Cost Factor Name Description Allocation Basis Acquisition Cost Indicator Invoice Line
Type
SH_HANDLING_QTY SH Handling Qty SH Quantity Inventory Freight
Handling
Qty

SH_FREIGHT_ V SH Freight By SH Freight Value Inventory Freight

Value By Value
Step 5: Define LCM Shipment Line Type

Step 6: Define LCM Shipment Type

In Party Type Allowed TAB in Party Type select the value as Organization.

In Party Usages Allowed TAB in Party Usage select the value as Supplier.
In Source Type Allowed TAB in Source Type select the value as Purchase Order.

Step 7: Define New Organization with LCM check Box ON

Step 8: Receiving Option: Un Check Pre-Receiving in LCM box for After Receiving type LCM.
LCM Accounts
Landed Cost Absorption Account
Invoice Price Variance Account
Exchange Rate Variance Account
Tax Variance Account
Default Charge Account
Account
01-000-8801-0000-000
01-000-8802-0000-000
01-000-8803-0000-000
01-000-8804-0000-000
01-000-8801-0000-000

Step 9 : Open Period for New Organization.

Step 10: Assign Item to the new Inventory Org.

Step 11: Define LCM Options

LCM-->Setup-->Options
Define Items To Test
Oracle Advanced Pricing (Optional)

Integration with Oracle Advanced Pricing enables you to set conditions for the automatic application of the
required charges, fees, duties and taxes for a landed cost management shipment. This means that estimated charges
can be applied automatically to a shipment.

Note: Oracle Advanced Pricing can also be used when managing landed cost for items that are acquired through
documents that do not have purchase order receipts, such as internal transfers and drop shipments. Oracle
Advanced Pricing can be used for the automatic application of the required charges, fees, duties and taxes for a
landed cost management shipment that are associated to these types of documents or transactions.

Setting Up Advanced Pricing Profile Options

If you are using Oracle Advanced Pricing to integrate with Oracle Landed Cost Management then you will want to define Advance d
Pricing profile options in a manner recognized by Landed Cost Management.
The Advanced Pricing application is required if you need automatic charge lines generation when using Landed Cost Management.
Advanced Pricing has several profile options. The following table lists the Advanced Pricing profile options and the profile value settings
that must be entered to enable the integration between Landed Cost Management and Advanced Pricing.

Profile Value Level

QP: Blind Discount Option Yes Application Level (Oracle Landed Cost Management)
QP: Licensed for Product Purchasing Application Level (Oracle Landed Cost Management) And User
QP: Pricing Perspective Request Type Purchase Order Application Level (Oracle Landed Cost Management)
QP: Pricing Transaction Entity Procurement User
QP: Source System Code Oracle Purchasing User

For more detailed information on these profile options, see the Oracle Advanced Pricing Implementation Guide.
Use this procedure to set up Advanced Pricing profile options:
To Set Up Advanced Pricing Profile Options
Typically, the System Administrator is responsible for setting up and updating profile option values. For more information, s ee Oracle
Applications System
Administrator's Guide, Setting User Profile Options.
1. Navigate to the System Profile Values window.
The Find System Profile Values window appears.
2. Enter QP% in the Profile field and click Find.
The System Profile Values window appears displaying all of the Advanced Pricing (QP) profile options.
3. Locate the specific profile option and enter the appropriate profile value.
4. Click the Save icon in the tool bar.