Maximo Open Forum

Hello More Maximo Community,

I was wondering if anyone could help me understand what the benefits are of "Reconciling Balances"?

The only thing I understand from our MRO department is that when a Physical Count or Current Balance is updated, you have to run the "Reconcile Balances".

I was asked if it is possible to turn it off, but before checking if that is possible I was wondering what was the reason it is there for and what is the best practice?

Thank you in advance,

.

#Administration
#Inventory

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Danny Richardson
Maximo Administrator Manager
Technimark LLC
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The purpose of inventory reconciliation is to make any necessary adjustments after a physical count was performed. You don't need to do it if there are transactions (IE receipts, issues, etc.) in/out of the storeroom, only physical count. 

If Maximo thinks you have 5 of a given part in a storeroom, you go and do a physical count and only find 3, the reconcile will create the financial adjustment for the 2 and update your current balance to be 3. Without this, Maximo will continue to assume you have 5 of that part on hand and may not trigger required activities like a reorder to replenish the storeroom. 

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Steven Shull
IBM
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My followup question would be why is physical count and reconciliation split into two steps?

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Robert Goff
Xanterra Travel Collection
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Original Message:
Sent: 06-04-2024 09:17
From: Steven Shull
Subject: Reconcile Balances - What is best practice? Why is it there?

The purpose of inventory reconciliation is to make any necessary adjustments after a physical count was performed. You don't need to do it if there are transactions (IE receipts, issues, etc.) in/out of the storeroom, only physical count. 

If Maximo thinks you have 5 of a given part in a storeroom, you go and do a physical count and only find 3, the reconcile will create the financial adjustment for the 2 and update your current balance to be 3. Without this, Maximo will continue to assume you have 5 of that part on hand and may not trigger required activities like a reorder to replenish the storeroom. 

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Steven Shull
IBM
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The usual split between physical count and reconciliation is audit control. Even before Sarbanes-Oxley Compliance issues arose, Maximo supported having security separate the functions of physical count and reconciliation so that different people would have those responsibilities. 

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Christopher Winston
Projetech Inc.
IBM Champion 2024
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Original Message:
Sent: 06-04-2024 10:22
From: Robert Goff
Subject: Reconcile Balances - What is best practice? Why is it there?

My followup question would be why is physical count and reconciliation split into two steps?

------------------------------
Robert Goff
Xanterra Travel Collection
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Original Message:
Sent: 06-04-2024 09:17
From: Steven Shull
Subject: Reconcile Balances - What is best practice? Why is it there?

The purpose of inventory reconciliation is to make any necessary adjustments after a physical count was performed. You don't need to do it if there are transactions (IE receipts, issues, etc.) in/out of the storeroom, only physical count. 

If Maximo thinks you have 5 of a given part in a storeroom, you go and do a physical count and only find 3, the reconcile will create the financial adjustment for the 2 and update your current balance to be 3. Without this, Maximo will continue to assume you have 5 of that part on hand and may not trigger required activities like a reorder to replenish the storeroom. 

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Steven Shull
IBM

Usually it's the newest/lower ranking persons doing the counts on our vessels.  We don't have scanners, so it's still done via paper and pencil.  I've seen where a 2-pack is counted as qty 2 in year-1 and then counted as qty 1 in year-2 and then counted as qty 2 in year-3.  Also seen people accidentally type in the item number as the quantity.  Mistakes happen.  Only the highest ranking persons onboard can reconcile the count.  We have a report that shows by item what it should be, what the count is, and what the monetary difference would be if they accepted the count.  This gives them an opportunity to send the counter (or a second set of eyes) back for a second count on high dollar or high volume discrepancies.  Inventory is on someone's performance review and they should want to be the only one who can reconcile the count/change the inventory level.  

It will also give the person in charge a good feel if there's an issue with loss/theft, or people being lazy/forgetful and not issuing spares to work orders.  I've seen people do a physical count because they forgot to issue it to the work order.  Stuff like this needs to be visible to the vessel's management.

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gail smith
chevron
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Original Message:
Sent: 06-04-2024 10:22
From: Robert Goff
Subject: Reconcile Balances - What is best practice? Why is it there?

My followup question would be why is physical count and reconciliation split into two steps?

------------------------------
Robert Goff
Xanterra Travel Collection
------------------------------


Original Message:
Sent: 06-04-2024 09:17
From: Steven Shull
Subject: Reconcile Balances - What is best practice? Why is it there?

The purpose of inventory reconciliation is to make any necessary adjustments after a physical count was performed. You don't need to do it if there are transactions (IE receipts, issues, etc.) in/out of the storeroom, only physical count. 

If Maximo thinks you have 5 of a given part in a storeroom, you go and do a physical count and only find 3, the reconcile will create the financial adjustment for the 2 and update your current balance to be 3. Without this, Maximo will continue to assume you have 5 of that part on hand and may not trigger required activities like a reorder to replenish the storeroom. 

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Steven Shull
IBM

Thank you all, this was some helpful information.  I will pass it along.

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Danny Richardson
Maximo Administrator Manager
Technimark LLC
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