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Flash Transactions

Flash Transactions. Accounting as of 1/1/99 for Inter-Alliance Transactions. November 17, 1998. What is a Flash Transaction? Why are they necessary?. In the Alliance, we have ‘one face to the market’.

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Flash Transactions

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  1. Flash Transactions Accounting as of 1/1/99 for Inter-Alliance Transactions November 17, 1998

  2. What is a Flash Transaction? Why are they necessary? • In the Alliance, we have ‘one face to the market’. • Equiva Trading will go into the market and create deals on behalf of Equilon and Motiva. • Equiva Trading will only own inventory when it creates a deal for the purpose of Third Party Trading (TPT) • When a Equilon purchases from or sells to a third party, the inventory is reflected on Equilon’s book, but the payable or receivable is paid to or by Equiva. • All contracts (except for TPT by Equiva) are held on Equilon or Motvia’s book • The flash functionality allows the inventory to be managed on one company and the financials to be managed on another

  3. For Which Scenarios Will You See Flashes? • Equilon moves product on exchange • Equilon purchases from a third party • Equilon sells to a third party • You will NOT see a flash occur for the following: • Equiva Trading purchases from a third party • Equiva Trading sells to a third party • Equiva Trading buys from Equilon or Motiva • Equiva Trading sells to Equilon or Motiva

  4. The Company Code Structure • 0001 Motiva Enterprises LLC • 0201 Equilon Enterprises LLC • 0301 Equiva Trading Company • 0302 Equiva Trading Int’l* • 0303 Equiva Trading - Motiva* • 0304 Equiva Trading - Equilon* • 0305 ETI Canada • 0401 Equiva Services* • *FI only, no MM/SD moves What Are Some of the SAP Specific Data Issues? • Plant Naming Convention • 1000-1999 Equiva Trading for TPT Plants • 6000-6999 Equilon Plants • 7000-7999 All Refinery Locations • 8000-8999 Motiva Plants

  5. Equilon Moves Product on Exchange • Exchange Contract set up in IO and passed to SAP to the Equilon or Motiva company code • All exchange activity goes against these contracts, meaning all inventory will be on Equilon/Motiva books. Accounting entries will be: • Delivery:Receipt: • Logical inventory xxx Physical inventory xxx • Physical inventory xxx Logical inventory xxx • The month end exchange statement will say Equiva Trading Company, even though it is generated from the Motiva/Equilon company code. Accounting on MO/EQ: • Exchange Fee Clearing Acct xxx • Exchange Partner A/P account xxx • A MANUAL intercompany entry will be made for exchange fees only • Exchange Partner A/P account xxx • Intercompany for ETCO xxx • Intercompany for Equilon xxx • Exchange Partner A/P account xxx • All payables and receivables from or to the exchange partner will be handled by ETCO

  6. Equilon Purchases Product • Contract entered in IO will print with ETCO name • Contracts passed to SAP via interface to Equilon company code • All purchases go against these contracts, meaning all financial and inventory postings will be on Equilon’s books • The financial payable will be ‘flashed’ to a financial only ETCO company code(no inventory will be recorded on this company code) • The above posting will contain enough detail to tie it back to the specific transaction on the Equilon company code. This includes document info, BOL, quantity, product, dollars, etc.

  7. Equilon Purchases Product, cont. • When the Actual Call-Off Against the Contract is Made: • Inventory xxx (Equilon) • GR/IR xxx (Equilon) • When the Invoice is Received: • GR/IR xxx (Equilon) • AP Vendor xxx (Equilon) • FLASH to ETCO • AP Vendor xxx (Equilon) • Intercompany for ETCO xxx (Equilon) • Intercompany for Equilon xxx (ETCO-Equilon) • AP Vendor xxx (ETCO-Equilon) • COGS xxx (ETCO-Equilon) • Revenue xxx (ETCO-Equilon)

  8. Equilon Sells Product • Contract entered in IO will print with ETCO name • Contracts passed to SAP via interface to Equilon company code • All sales go against these contracts, meaning all financial and inventory postings will be on Equilon’s books • The financial receivable will be ‘flashed’ to a financial only ETCO company code(no inventory will be recorded on this company code) • The above posting will contain enough detail to tie it back to the specific transaction on the Equilon company code. This includes document info, BOL, quantity, product, dollars, etc.

  9. Equilon Sells Product, cont. • When the Actual Call-Off Against the Contract is Made: • COGS xxx (Equilon) • Inventory xxx (Equilon) • A/R Customer xxx (Equilon) • Revenue xxx (Equilon) • FLASH to ETCO • Revenue xxx (Equilon) • A/R Customer xxx (Equilon) • Intercompany for ETCO xxx (Equilon) • Revenue xxx (Equilon) • COGS xxx (ETCO-Equilon) • Intercompany for Equilon xxx (ETCO-Equilon) • A/R Customer xxx (ETCO-Equilon) • Revenue xxx (ETCO-Equilon)

  10. Equilon Sells to ETCO and Vice Versa • For the purpose of Equiva Trading TPT activity • There will be a sales and a purchase contract, a single movement will generate two transactions - one in each company code • The ETCO company code to use in such transactions will be 0301. The ETCO plant will be a 1000 series plant • The Equiva company code for such transactions will be 0201. The Equilon plant will be a 6000 series plant • The accounting entries will look like third party transactions

  11. Equilon Sells to ETCO and Vice Versa • Trader enters a purchase contract for ETCO and a sales contract for Equilon in IO -passed to SAP via interface • Scheduler schedules the move only against the sales contract • The sales side of the transaction is passed to SAP, the purchase by ETCO is handled in the flash program Through the billing document: COGS xxx (Equilon) Inventory xxx (Equilon) A/R Customer - ETCO xxx (Equilon) Revenue xxx (Equilon) Purchase call-off: Inventory xxx (ETCO) GR/IR xxx (ETCO) Flash: GR/IR xxx (ETCO) Intercompany - Equilon xxx (ETCO) Intercompany - ETCO xxx (Equilon) A/R Customer - ETCO xxx (Equilon)

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