Month end close finds landed cost errors when they are already in the accounts. Exception reports find them in the week they happen, by looking for the shapes errors take: missing freight, duty with no goods, weights that moved. This post lists the five reports worth running and what each one is really looking for.
By the time month end close surfaces a landed cost error, the goods are sold, the margin is reported, and correcting the record means restating numbers people have already presented. The error itself was usually visible weeks earlier, in a mismatch between systems that nobody was assigned to look at. Exception reporting is just assigning the looking, on a weekly rhythm, to shapes rather than to suspicions.
One: customs entries with no goods receipt after the expected window. Either the goods are lost, the receipt was booked to the wrong order, or the entry references are wrong. All three matter, and all three get harder to untangle with age.
Two: freight invoices with no matching entry or shipment. Freight gets billed late, duplicated, and against cancelled bookings. This report is the difference between catching a duplicate in the month it was billed and funding a carrier audit recovery project next year.
Three: duty paid at a rate that differs from the rate in the product master file. Either the entry is wrong or the master file is wrong, and both possibilities deserve a same week answer, because the wrong one is repeating on every shipment until it is fixed.
Four: per unit landed cost variance against the previous shipment of the same SKU, beyond a band you set, say eight percent. This is the drift catcher: freight changes, pack changes, currency, and quiet price moves all surface here in one number that asks one question.
Five: shipments received but uncosted after ten days. Uncosted stock sells at unknown margin and poisons every report downstream. The list should be short enough to clear by name, every week, in one short meeting.
Set the bands too tight and the reports cry wolf until the team stops reading them, which is worse than having no reports. Too loose and they become a monthly reassurance ritual. Start with the variance band and the ageing limits deliberately wide, review what they caught after a month, and tighten one notch at a time based on what turned out to be real.
Route every exception to a named owner with a close out note. An exception report that circulates for information is a newsletter. The value is in the closed items and the reasons recorded, which over a quarter become a map of where your landed cost process actually breaks, as opposed to where the procedure manual says it might.
Run weekly, these five reports change the month end conversation from discovery to confirmation. The close still checks the numbers. It just stops being the first time anyone has seen them, and the corrections shrink from restatements to adjustments. That is the entire business case, and it costs a standing hour a week.
Keep reading: How do you spot landed cost drift when a supplier quietly changes pack sizes?, Supplier quotes versus actual landed cost: closing the estimate gap, and Landed cost variance reports: explaining a gap to finance cover the nearby cases in this series.
A recurring report that lists only the records breaking a defined rule: an entry with no receipt, a cost variance beyond a set band, a shipment uncosted too long. Instead of reviewing everything, the team reviews only the shapes that indicate an error is in progress.
Per unit landed cost variance against the previous shipment of the same product. Freight changes, pack changes, duty errors, and currency swings all move that number, so one report surfaces several different failure types for a single review.
Wide enough that most flags are real. Start around an eight to ten percent band on per unit cost, then tighten gradually based on a month of results. A report that flags everything trains the team to ignore it, which is worse than a narrower report that gets read.
A named person per report, with authority to chase the owning team and a requirement to close each item with a recorded reason. Circulation without ownership produces awareness, not corrections, and the same exceptions recur weekly.