diff --git a/addons/mrp/mrp.py b/addons/mrp/mrp.py
index dcf2a82db26..42064718088 100644
--- a/addons/mrp/mrp.py
+++ b/addons/mrp/mrp.py
@@ -493,7 +493,7 @@ class mrp_production(osv.osv):
         'workcenter_lines': fields.one2many('mrp.production.workcenter.line', 'production_id', 'Work Centers Utilisation',
             readonly=True, states={'draft': [('readonly', False)]}),
         'state': fields.selection(
-            [('draft', 'New'), ('cancel', 'Cancelled'), ('picking_except', 'Picking Exception'), ('confirmed', 'Awaiting Raw Materials'),
+            [('draft', 'New'), ('cancel', 'Cancelled'), ('confirmed', 'Awaiting Raw Materials'),
                 ('ready', 'Ready to Produce'), ('in_production', 'Production Started'), ('done', 'Done')],
             string='Status', readonly=True,
             track_visibility='onchange',
@@ -614,12 +614,6 @@ class mrp_production(osv.osv):
         }
         return {'value': result}
 
-    def action_picking_except(self, cr, uid, ids):
-        """ Changes the state to Exception.
-        @return: True
-        """
-        self.write(cr, uid, ids, {'state': 'picking_except'})
-        return True
 
     def _action_compute_lines(self, cr, uid, ids, properties=None, context=None):
         """ Compute product_lines and workcenter_lines from BoM structure
@@ -685,6 +679,11 @@ class mrp_production(osv.osv):
                 move_obj.action_cancel(cr, uid, [x.id for x in production.move_created_ids])
             move_obj.action_cancel(cr, uid, [x.id for x in production.move_lines])
         self.write(cr, uid, ids, {'state': 'cancel'})
+        # Put related procurements in exception
+        proc_obj = self.pool.get("procurement.order")
+        procs = proc_obj.search(cr, uid, [('production_id', 'in', ids)], context=context)
+        if procs:
+            proc_obj.write(cr, uid, procs, {'state': 'exception'}, context=context)
         return True
 
     def action_ready(self, cr, uid, ids, context=None):
@@ -697,8 +696,6 @@ class mrp_production(osv.osv):
         for production in self.browse(cr, uid, ids, context=context):
             if not production.move_created_ids:
                 self._make_production_produce_line(cr, uid, production, context=context)
-                for scheduled in production.product_lines:
-                    self._make_production_line_procurement(cr, uid, scheduled, False, context=context)
 
             if production.move_prod_id and production.move_prod_id.location_id.id != production.location_dest_id.id:
                 move_obj.write(cr, uid, [production.move_prod_id.id],
@@ -712,6 +709,10 @@ class mrp_production(osv.osv):
         for production in self.browse(cr, uid, ids):
             self._costs_generate(cr, uid, production)
         write_res = self.write(cr, uid, ids, {'state': 'done', 'date_finished': time.strftime('%Y-%m-%d %H:%M:%S')})
+        # Check related procurements
+        proc_obj = self.pool.get("procurement.order")
+        procs = proc_obj.search(cr, uid, [('production_id', 'in', ids)], context=context)
+        proc_obj.check(cr, uid, procs, context=context)
         return write_res
 
     def test_production_done(self, cr, uid, ids):
@@ -965,29 +966,8 @@ class mrp_production(osv.osv):
             if production.ready_production:
                 res = True
         return res
-
-    def _make_production_line_procurement(self, cr, uid, production_line, shipment_move_id, context=None):
-        procurement_order = self.pool.get('procurement.order')
-        production = production_line.production_id
-        location_id = production.location_src_id.id
-        date_planned = production.date_planned
-        procurement_name = (production.origin or '').split(':')[0] + ':' + production.name
-        procurement_id = procurement_order.create(cr, uid, {
-                    'name': procurement_name,
-                    'origin': procurement_name,
-                    'date_planned': date_planned,
-                    'product_id': production_line.product_id.id,
-                    'product_qty': production_line.product_qty,
-                    'product_uom': production_line.product_uom.id,
-                    'product_uos_qty': production_line.product_uos and production_line.product_qty or False,
-                    'product_uos': production_line.product_uos and production_line.product_uos.id or False,
-                    'location_id': location_id,
-                    'move_id': shipment_move_id,
-                    'company_id': production.company_id.id,
-        })
-        procurement_order.signal_button_confirm(cr, uid, [procurement_id])
-        return procurement_id
-
+    
+    
     def _make_production_produce_line(self, cr, uid, production, context=None):
         stock_move = self.pool.get('stock.move')
         source_location_id = production.product_id.property_stock_production.id
diff --git a/addons/mrp/mrp_view.xml b/addons/mrp/mrp_view.xml
index 05cce984b48..72b5fc845c6 100644
--- a/addons/mrp/mrp_view.xml
+++ b/addons/mrp/mrp_view.xml
@@ -675,12 +675,10 @@
                     <button name="%(act_mrp_product_produce)d" states="ready,in_production" string="Produce" type="action" class="oe_highlight"/>
                     <button name="action_assign" states="confirmed,picking_except" string="Check Availability" type="object" class="oe_highlight"/>
                     <button name="force_production" states="confirmed" string="Force Reservation" type="object"/>
-                    <button name="force_production" states="picking_except" string="Force Reservation" type="object"/>
                     <button name="button_produce" states="ready" string="Mark as Started"/>
-                    <button name="button_recreate" states="picking_except" string="Recreate Picking"/>
-                    <button name="button_cancel" states="draft,ready,in_production,picking_except" string="Cancel Production"/>
+                    <button name="button_cancel" states="draft,ready,in_production" string="Cancel Production"/>
                     <button name="action_cancel" type="object" states="confirmed" string="Cancel Production"/>
-                    <field name="state" widget="statusbar" statusbar_visible="draft,ready,in_production,done" statusbar_colors='{"picking_except":"red","confirmed":"blue"}'/>
+                    <field name="state" widget="statusbar" statusbar_visible="draft,ready,in_production,done" statusbar_colors='{"confirmed":"blue"}'/>
                 </header>
                 <sheet>
                     <div class="oe_title">
@@ -721,7 +719,7 @@
                             <group>
                                 <group string="Products to Consume">
                                     <field name="move_lines" nolabel="1" options="{'reload_on_button': true}">
-                                        <tree colors="blue:state == 'draft';black:state in ('ready','assigned','in_production');gray:state in ('cancel','done');red:state in ('confirmed','picking_except','waiting')" string="Products to Consume">
+                                        <tree colors="blue:state == 'draft';black:state in ('ready','assigned','in_production');gray:state in ('cancel','done');red:state in ('confirmed','waiting')" string="Products to Consume">
                                             <field name="product_id"/>
                                             <field name="product_qty"  string="Quantity"/>
                                             <field name="product_uom" string="Unit of Measure" groups="product.group_uom"/>
@@ -740,7 +738,7 @@
                                 </group>
                                 <group string="Consumed Products">
                                     <field name="move_lines2" nolabel="1" options="{'reload_on_button': true}">
-                                       <tree colors="red:scrapped==True;blue:state == 'draft';black:state in('picking_except','confirmed','ready','in_production');gray:state == 'cancel' " string="Consumed Products" editable="bottom">
+                                       <tree colors="red:scrapped==True;blue:state == 'draft';black:state in ('confirmed','ready','in_production');gray:state == 'cancel' " string="Consumed Products" editable="bottom">
                                            <field name="product_id" readonly="1"/>
                                            <field name="restrict_lot_id" context="{'product_id': product_id}" groups="stock.group_tracking_lot"/>
                                            <field name="product_qty" readonly="1"/>
@@ -767,7 +765,7 @@
                                 </group>
                                 <group string="Produced Products">
                                     <field name="move_created_ids2" nolabel="1" options="{'reload_on_button': true}">
-                                        <tree colors="red:scrapped==True;blue:state == 'draft';black:state in('picking_except','confirmed','ready','in_production');gray:state in('cancel','done') " string="Finished Products">
+                                        <tree colors="red:scrapped==True;blue:state == 'draft';black:state in('confirmed','ready','in_production');gray:state in('cancel','done') " string="Finished Products">
                                             <field name="product_id" readonly="1"/>
                                             <field name="product_qty" readonly="1"/>
                                             <field name="restrict_lot_id" groups="stock.group_tracking_lot"/>
diff --git a/addons/mrp/stock.py b/addons/mrp/stock.py
index 1786336bedd..d0592128908 100644
--- a/addons/mrp/stock.py
+++ b/addons/mrp/stock.py
@@ -228,7 +228,7 @@ class stock_warehouse(osv.osv):
             'route_id': manufacture_route_id,
             'action': 'manufacture',
             'picking_type_id': warehouse.int_type_id.id,
-            'procure_method': 'make_to_order',
+            'propagate': False, 
             'warehouse_id': warehouse.id,
         }
 
diff --git a/addons/mrp_operations/mrp_operations.py b/addons/mrp_operations/mrp_operations.py
index b464f7045e6..14acd667866 100644
--- a/addons/mrp_operations/mrp_operations.py
+++ b/addons/mrp_operations/mrp_operations.py
@@ -97,7 +97,7 @@ class mrp_production_workcenter_line(osv.osv):
        'delay': fields.float('Working Hours',help="The elapsed time between operation start and stop in this Work Center",readonly=True),
        'production_state':fields.related('production_id','state',
             type='selection',
-            selection=[('draft','Draft'),('picking_except', 'Picking Exception'),('confirmed','Waiting Goods'),('ready','Ready to Produce'),('in_production','In Production'),('cancel','Canceled'),('done','Done')],
+            selection=[('draft','Draft'),('confirmed','Waiting Goods'),('ready','Ready to Produce'),('in_production','In Production'),('cancel','Canceled'),('done','Done')],
             string='Production Status', readonly=True),
        'product':fields.related('production_id','product_id',type='many2one',relation='product.product',string='Product',
             readonly=True),
diff --git a/addons/purchase/stock.py b/addons/purchase/stock.py
index 546ef5c60a9..69d970b7be6 100644
--- a/addons/purchase/stock.py
+++ b/addons/purchase/stock.py
@@ -112,7 +112,7 @@ class stock_warehouse(osv.osv):
             'route_id': buy_route_id,
             'action': 'buy',
             'picking_type_id': warehouse.in_type_id.id,
-            'procure_method': 'make_to_order',
+            'propagate': False, 
             'warehouse_id': warehouse.id,
         }
 
diff --git a/addons/sale_mrp/test/cancellation_propagated.yml b/addons/sale_mrp/test/cancellation_propagated.yml
index 770601bac6d..0005e15db53 100644
--- a/addons/sale_mrp/test/cancellation_propagated.yml
+++ b/addons/sale_mrp/test/cancellation_propagated.yml
@@ -51,12 +51,17 @@
   Confirm sales order
 - 
   !workflow {model: sale.order, action: order_confirm, ref: sale_order_product_manu}
+-
+  I run scheduler.
+-
+  !python {model: procurement.order}: |
+    self.run_scheduler(cr, uid)
 - 
   Check the propagation when we cancel the main procurement 
     * Retrieve related procurements and check that there are all running
     * Check that the purchase order has been well created
     * Cancel the main procurement
-    * Check that all procurements related and the purchase order has been well cancelled   
+    * Check that all procurements related and the purchase order has been well cancelled
 -
   !python {model: procurement.order}: |
     # Retrieve related procu
@@ -65,7 +70,7 @@
     assert len(procu_ids)>0, 'No procurements are found for sale order "%s" (with id : %d)' %(so.name, so.id)
 
     # Check that all procurements are running 
-    for procu in self.browse(cr, uid, procu_ids, context=context):        
+    for procu in self.browse(cr, uid, procu_ids, context=context):
         assert procu.state == u'running', 'Procurement with id %d should be "running" but is with a state : %s!' %(procu.id, procu.state)
 
     # Check that one production order exist
diff --git a/addons/sale_mrp/test/sale_mrp.yml b/addons/sale_mrp/test/sale_mrp.yml
index 82c8b6e8b12..85e25b502f3 100644
--- a/addons/sale_mrp/test/sale_mrp.yml
+++ b/addons/sale_mrp/test/sale_mrp.yml
@@ -100,7 +100,7 @@
   !python {model: procurement.order}: |
     sale_order_obj = self.pool.get('sale.order')
     so = sale_order_obj.browse(cr, uid, ref("sale_order_so0"))
-    proc_ids = self.search(cr, uid, [('origin','=',so.name)])
+    proc_ids = self.search(cr, uid, [('origin','like',so.name)])
     self.run(cr, uid, proc_ids)
 -
   I verify that a procurement state is "running"
@@ -108,8 +108,8 @@
   !python {model: procurement.order}: |
     sale_order_obj = self.pool.get('sale.order')
     so = sale_order_obj.browse(cr, uid, ref("sale_order_so0"))
-    proc_ids = self.search(cr, uid, [('origin','like',so.name), ('state','=','running')])
-    # Check that all procurement are running 
+    proc_ids = self.search(cr, uid, [('origin','like',so.name)])
+    # Check that all procurement are running
     for procu in self.browse(cr,uid,proc_ids,context=context):        
         assert procu.state == u'running', 'Procurement with id %d should be with a state "running" but is with a state : %s!' %(procu.id,procu.state)
 -
diff --git a/addons/stock/procurement.py b/addons/stock/procurement.py
index 8b96ec48f2a..bdae93a4054 100644
--- a/addons/stock/procurement.py
+++ b/addons/stock/procurement.py
@@ -99,8 +99,7 @@ class procurement_order(osv.osv):
         #set the context for the propagation of the procurement cancelation
         ctx['cancel_procurement'] = True
         for procurement in self.browse(cr, uid, to_cancel_ids, context=ctx):
-            if procurement.rule_id and procurement.rule_id.propagate:
-                self.propagate_cancel(cr, uid, procurement, context=ctx)
+            self.propagate_cancel(cr, uid, procurement, context=ctx)
         return super(procurement_order, self).cancel(cr, uid, to_cancel_ids, context=ctx)
 
     def _find_parent_locations(self, cr, uid, procurement, context=None):
diff --git a/addons/stock/stock.py b/addons/stock/stock.py
index e7fc3a36d05..7285ccd6ea9 100644
--- a/addons/stock/stock.py
+++ b/addons/stock/stock.py
@@ -2120,7 +2120,7 @@ class stock_move(osv.osv):
                 quants = quant_obj.quants_get_prefered_domain(cr, uid, move.location_id, move.product_id, qty, domain=main_domain[move.id], prefered_domain_list=[], restrict_lot_id=move.restrict_lot_id.id, restrict_partner_id=move.restrict_partner_id.id, context=context)
                 quant_obj.quants_reserve(cr, uid, quants, move, context=context)
 
-        #force assignation of consumable products and incoming from supplier/inventory/production 
+        #force assignation of consumable products and incoming from supplier/inventory/production
         if to_assign_moves:
             self.force_assign(cr, uid, to_assign_moves, context=context)
 
@@ -2144,6 +2144,14 @@ class stock_move(osv.osv):
                 #cancel chained moves
                 if move.propagate:
                     self.action_cancel(cr, uid, [move.move_dest_id.id], context=context)
+                    # If we have a long chain of moves to be cancelled, it is easier for the user to handle
+                    # only the last procurement which will go into exception, instead of all procurements
+                    # along the chain going into exception.  We need to check if there are no split moves not cancelled however
+                    if move.procurement_id:
+                        proc = move.procurement_id
+                        if all([x.state == 'cancel' for x in proc.move_ids if x.id != move.id]):
+                            procurement_obj.write(cr, uid, [proc.id], {'state': 'cancel'})
+
                 elif move.move_dest_id.state == 'waiting':
                     self.write(cr, uid, [move.move_dest_id.id], {'state': 'confirmed'}, context=context)
         return self.write(cr, uid, ids, {'state': 'cancel', 'move_dest_id': False}, context=context)
@@ -2360,6 +2368,7 @@ class stock_move(osv.osv):
             'restrict_lot_id': restrict_lot_id,
             'restrict_partner_id': restrict_partner_id,
             'split_from': move.id,
+            'move_dest_id': move.move_dest_id.id,
         }
         if context.get('source_location_id'):
             defaults['location_id'] = context['source_location_id']
diff --git a/addons/stock_dropshipping/test/cancellation_propagated.yml b/addons/stock_dropshipping/test/cancellation_propagated.yml
index cb68b582a6a..71f5e75385d 100644
--- a/addons/stock_dropshipping/test/cancellation_propagated.yml
+++ b/addons/stock_dropshipping/test/cancellation_propagated.yml
@@ -40,6 +40,11 @@
   Confirm the sale order
 - 
   !workflow {model: sale.order, action: order_confirm, ref: sale_order_product_mto}
+-
+  I run scheduler.
+-
+  !python {model: procurement.order}: |
+    self.run_scheduler(cr, uid)
 - 
   Check the propagation when we cancel the main procurement 
     * Retrieve related procurements and check that there are all running
@@ -64,7 +69,7 @@
     # Cancel the main procurement
     main_procu_id = self.search(cr, uid, [('origin', '=', so.name)])
     assert len(main_procu_id) == 1, 'Main procurement not identified !'
-    self.cancel(cr, uid, main_procu_id, context=context)    
+    self.cancel(cr, uid, main_procu_id, context=context)
     assert self.browse(cr, uid, main_procu_id[0]).state == u'cancel', 'Main procurement should be cancelled !'
     
     # Check that all procurements related are cancelled