Sap MM Training

SAP MM Training
Presented by: S2S InfoTech

Agenda
 Introduction
 Enterprise Structure
 Master Data
 Procurement Process
 Pricing procedure
 Release Strategy
 Inventory management
 Message Output determination
 Special Procurement Process
 Physical Inventory
 Material Requirement Planning

 Evaluation and account determination
 Batch Management
 Invoice Verification
 Integration with Other Modules
 Country Version India (CIN)
Page 2
Unit 1
Introduction
Introduction to ERP
Implements funct ons of order
placement.. order scheduling.sh pping
and i nvoicing.
Sales
Procurement (SRM)
Mrodmise cost savings wi th support for
the end-to-ec-'ld pcocurement and II

logistics processes
II
Analyse data and
convert to information Focus on extal strategies
Production (PLM)
II
Business Intelligence e-commerce
Efficient:ly and sustainably manage
the entir-e asset lifeicyde, improve asset
usage and cut costs with

Helps nplanningand optimising
the rnanufactu ring capacity and
material resources. ftis evolved
JI rrom the MRP.

Control _,._._ proc.-sand
..--..-nenaln the
_.. and ..spandfa-.to
II powerful analyt:ics
Enterprise asset
and others
challenges and Insupply
anddemand
management Distribution (SCM)
Accounting
Automate any financial opet'ations
while ensuring regulatory compliance and gaining real-time insight into overall peo-fo<n>MKe.
Page 4
What is ERP?
 Enterprise resource planning (ERP) is business process
management software that allows an organization to use a syste
 ERP provides an integrated view of core business processes,
database management syst
 ERP Products
 SAP
 Oracle – PeopleSoft
 Oracle – JDE
 Microsoft-Dynamic ERP
Page 5
What is SAP ?
 SAP is enterprise resource planning software developed by th
company SAP AG. SAP incorporates the key business functions
 Business Processes included in SAP ERP include Operations
Distribution, Materials Management, Production Planning, Logis
Human Capital Management (Payroll, e-Recruiting).
Page 6
SAP Modules
Accounting
...
Human
Resources
Cross
Applications
Page 7
Which Industries are using SAP

 Manufacturing Industries
 Service Industries
 Petroleum Industries ( Oil & Gas )
 Mining industries
 Insurance
 Pharmacy
 Banking & Telecommunications etc.,
Page 8
History of SAP
Company : SAP AG
When : 1972
Where : Walldorf, Germany
By Whom : 5 former IBM employees. R/3 Introduction
Page 9
SAP R/3 Architecture

SAP R/3 A .-chi1r:ect:ure
Presen-r a-rion R/3
IP res e nta"i:io n Co mpo nent s
A BA P
vV o irkbenc h
App l c:ation
yi·
/
SAP
A pp l catio ns
Kernie I & B-a sis Se rv-f ces
Dat a base r..11ana ge m en"i: Syste m
Database
Page 10
SAP R/3 Architecture

 SAP based the architecture of R/3 on a three-tier client/server
 Presentation Server
The presentation server is actually a program named sapgui.exe
 Application Server
An application server is a set of executables that collectively inte
When an application server is started, these executables all star
 Database Server
The database server is a set of executables that accept databas
Page 11
System Landscaping
SAP System landscape is
the group of systems that company has installed, all the system
SAP is divided into three different landscape DEV, QAS and PR
DEV would have multiple clients for ex: 110- Configuration, 120-
- QAS may again have multiple clients for ex: 200- Integration T
- PRD may have something like a 300 Production
Page 12
Transport Management
SAP Transport Management
System (TMS) is a tool within SAP ERP systems to manage so
Customizing transports contains configuration and they are cr
functional team does the configuration of your SAP system.
Workbench transports contains development work like ABAP p
In general, not always, customizing is client-dependent and wor
Page 13
Role and responsibility of ABAP Consult

 Implementation & Upgrade
 Conduct workshops and gather requirements
 Prepare Business blueprint
 Prepare functional Spec and configuration
 Business process testing
 UAT and end user training
 Data migration strategy
 User manual
 Support
 Receiving tickets/issues from business .
 Analyzing the ticket .
 Resolving the issue in time
 Prepare functional spec for Change request
 Unit testing and transport to QAS for UAT testing
Page 14
What is MM
The SAP MM module
handles the procurement and inventory functions of organizations that engage in
Page 15
MM Process Flow
Unit 2
Enterprise Structure
Enterprise Structure
Client is a self-contained unit in an
R/3 System with separate master records and its own set of tables
An organizational unit responsible for
procuring materials or services for one or more plants and for negotiating general conditions of purchase with vendor
This level represents an
independent accounting unit within a client. Each company code has its own balance sheet and its own profit and loss
statement. An orga
unit serving to subdivide an enterprise according to production, procurement, maintenance, and materials planning as
An
organization al unit allowing the differentiati on of material stocks within a plant.
Unit 3
Master Data
Master Data
Stock Non stock
Agreement
Service
Master Data
 Master data contains data records that are stored in the database for
 The material master record and vendor master record are the most im
master data in the procurement process.
 Material Master
Tcodes: MM01/MM02/MM03
 The material master database contains descriptions of all materials th
enterprise procures, produces, and keeps in stock.
 Vendor master
Tcodes: XK01/XK02/XK03
 The vendor master database contains information about the vendors
supply an enterprise. This information is stored in individual vendor ma
Page 21
Master Data in the Procurement Proc

Purchase order
Header
Items
10 ---
20 --
30---
Purchasing
info record
Views in a Material Master
The material master represents the central source
for releasing material-specific data. It is used by all of the SAP Logistics components in the
Integrating all of the material data in one single database object means that the problem of
The data contained in the material master is required, for example, by the following function
Material Master: Organizational Level

Some material data is valid for all
organizational levels, while some is only valid for certain levels.
The material master is designed to reflect the structure of your enterprise so that you can m
Data at client level: General material data that is valid for the whole company is stored at cl
Data at plant level: All data that is valid within a plant, and for all storage locations in it, is st
Data at storage location level: All data that is valid for a particular storage location is stored
Maintaining a Material Master Record: Screen

When editing material master data, you
go through a number of screens.
From the initial screen, you go to two
successive dialog boxes. In the first dialog box, you specify the views you want to process.
You can change the standard screen
sequence by changing the default values.
Some screens are not integrated in the
standard screen sequence. You can only access these screens by specifically choosing the
Material Key
You create a record in the material
master for each material that your company uses. Each material master record has its own
The type of material number assignment can be internal or external. You can use User Exit
The material type summarizes all materials with the same properties. It controls things such
The branch indicates what line of industry is assigned to the material. It also controls screen
Material Type
You can assign materials with the same
characteristics to the same material type. Material types include office supplies, equipment,
The type of number assignment (internal or external).
The permitted number range interval. Which screens are displayed and in which order.
Which user-department-specific data (view) is suggested for entry.
Along with the plant, the material type determines a material's inventory management requi
The material type also determines which accounts are posted when a material is posted to
Control of the Material Type

Procurement type (internal/external)
Master Data
Material
Views for material maintenance
External alphanumeric number assignment without check
Type of inventory management (quantity/value)
Assignment to an account category reference
Field selection and screen sequence
General incUcators for price control,special processes
and for Retail
Costing control
Item category group SD
Authorization group
Material Type: Quantity and Value Upda

Quantity Update:
If stock is possible, you may choose if you order materials for stock (storage) or for consum
Otherwise only procurement for consumption is possible.
Value Update:
If the stock is valuated, the value is posted to inventory/stock account.
Without value update you have to use a non-blank account assignment type. In this case th
Valuation Class
Master Data
You can use the valuation class to
combine materials for assigning G/L accounts so that you do not have to manage a separat
You maintain the valuation class in the
Accounting view of the material master record. The valuation class allowed for a material de
In automatic account determination, the
SAP System works with valuation classes. The valuation class is used to determine which s
Material Valuation Procedures

Valuation of goods receipts depends on the
price control procedure you set in the material master record. In the SAP System, material
In the standard price procedure (price control “S”), the system carries out all stock postings
Variances are posted to price difference accounts.
In the moving average price procedure (price control “V”), the system valuates goods receip
Differences between the purchase order price and the invoice are posted directly to the rele
ndor Master
Vendor master
Tcodes: XK01/XK02/XK03
 The vendor master database contains information about the ve
that supply an enterprise. This information is stored in individual
 General data:
This includes the vendor's address and bank details, for example.
This data is valid for the whole client.
 Accounting data:
This comprises data such as the number of the reconciliation account
 Purchasing data:
This includes the purchase order currency, incoterms, and the vendor
Page 32
Vendor Master Record

1==== Address , communication,
control data, bank
details
Company code data Account management
=i Payment transact ions
Correspondence Withholding tax

Purchasing organization data
l===
Purchasing data
Partner roles
Vendor Master Record: Organizational L
In Accounting, the vendor is
regarded as the company's crediting business partner. The vendor master record is therefo
You can use the SAP System authorization concept to define how data maintenance should
Each user department can maintain both general data and Purchasing and Accounting- spe
Vendor Master Record: Account Group

When creating a vendor master
record, you have to enter an account group. The account group has controlling characterist
You can create special master records for vendors from whom you only procure a material
One-Time Vendor
When creating a
purchasing document or accounting document with a one-time vendor, the system automat
You can use a single one- time vendor master record to cover a number of vendors. You no
Purchasing Data in the Vendor Master Record

Vendor master records
contain information on the vendors (external suppliers) of an enterprise.
From the Purchasing view, a vendor master record has the organizational levels “client” and
Data that applies to a purchasing organization can be maintained differently for a specific p
Partner Roles
The vendor can have
various functions in its interaction with your company. For example, during the procurement
By maintaining partner roles in the vendor master record, you can distribute one or more of
Master Data
 Purchase Info Record
Tcodes: ME11/ME12/M13
 The info record contains concise information about a vendor a
material that Purchasing already procures from that vendor. An i
es of Info record
Standard
Consignment
Pipeline
Subcontract
Page 39
Purchase Info Records

Purchasing info records contain concise
information on a vendor and the material you procure from this vendor.
The purchasing info record is an important source of information for the buyer, enabling him
You can store and maintain the following data in info records:
Current and future prices and conditions (for example, freight and discounts)
Delivery data (for example, planned delivery time and tolerances) Vendor data (for example
When you create purchasing documents (for example, purchase orders or contracts), the s
Purchase Info Records: Structure

A purchasing info record
contains general data that is valid for every purchasing organization or every plant.
It also contains data (for example, prices and conditions) that is only valid for the relevant p
When you create a purchase order, the system searches for an info record for the purchasi
In the standard system, the
following type of texts are set
Options to Maintain Purchase Info Reco

You can maintain info records
manually or automatically from quotations, purchase orders, or outline agreements.
Info Update Indicator: Quotation, Outline Agreement

Contract
Quotation
1 pc M-01
= UNI500
Discount 4 °/o
Material: M-01
PurchOrg: 1000 Plant: ?
Condjtjons Price/Un UNI500 /pc Discount 4°/o
Last purchase order
###
_J No update
A I Update with or without plant
Update with plant (if plant not prohibited) Update without plant f plant not
prohibited)
Master Data
 Source list
Tcodes: ME01
 A source list specifies the possible sources of supply for a mat
over a given period of time. It shows the time period in which a m
Page 44
Source of Supply
In MM Purchasing, the term “source of
supply” (or “source”) can mean a vendor (external supplier) or an outline purchase agreeme
An info record (short for “purchasing information record”) provides information for Purchasin
An outline purchase agreement is a longer-term arrangement with a vendor regarding the s
Source List
Source list analysis enables you to list the
materials of a plant for which no source list records exist during a certain period. This function is useful in t
).
The source list contains the allowed, preferred and/or
blocked sources of supply for a material in a plant that are valid within a certain period. Eac
Source list records enables you to determine and check sources.
Fixed sources are always preferred over other sources in the relevant validity period. Only o
Buyers are not allowed to procure from blocked sources. Blocked sources are not taken int
The MRP indicator in the source list stipulates how the source defined in a source list recor
If a source list requirement exists, a material may not be procured from sources other than
Creating Source List Automatically

Master Data
You can have the system automatically create a
source list. This allows you to enter or update all of a material's sources of supply.
In this procedure, the system creates a source list record for each info record or outline agr
You can create a source list for several materials (collective procedure) or for an individual
There is a preview function for creating source lists automatically. This allows you to simula
After update, the source lists can be restored to their original status.
Source list cannot be generated from outline agreement item carrying item category “D” (Se
Creating Source List for Material Group

Within the contract maintenance function, you can create source list records for a material
group for contract items with the item category M (material unknown) or W (material group)
Source list records for material groups define which materials can be released against a co
You can list either all disallowed materials (exclusion of materials) or all allowed materials (i
Blocking of Sources
Within the contract maintenance function,
you can create source list records for a material group for contract items with the item categ
Source list records for material groups define which materials can be released against a co
You can list either all disallowed materials (exclusion of materials) or all allowed materials (i
Master Data
 Service Master
Tcodes: AS03
 Conduct workshops and gather requirements
 Prepare Business blueprint
 Prepare functional Spec and configuration
 Business process testing
 UAT and end user training
 Data migration strategy
 User manual
Page 50
Service Master Record

A service master record contains a
service description and a unit of measure, for example, hour.
You can assign a price to each service
master record via the conditions.
This data can be obtained from various
SAP applications like PM , PS.
Defining Price at Service Master Conditi

There are several ways of
storing long-term prices for services in the form of service conditions:
At the service level (market price/own estimate)
At the service and vendor level
At the service, vendor, and plant level
Prices stored in the
system are automatically proposed in service specifications.
Unit 4
Procurement Process
Procurement Process
Purchase
Stock
material procurement
Non Stock
procurement
Outline
agreement
Service
procurement Import PO Asset PO
1.PR
2. RFQ
3. Quotation
4. Purchase order
5. Goods Receipt
6. Invoice verification
Contract Schedule Agreement
Stock/Non-Stock Material Procurement

 Material procurement is handled by purchasing
department of each plant at respective locations for v
Page 55
4.1 Stock/Non Stock

Procurement
Stock Material Procurement
1
2
3 4
5
6
7
Page 57

1. Procurement cycle starts with creation of Purchase requisitio
2. Request for Quotation is created with reference to released
3. Receive quotations from vendors
4. Perform price comparison to choose the best vendor .
5. Purchase Order is created with reference to selected Quotat
6. Once goods arrive at plant, Goods Receipt is done against r
7. Invoice verification for vendor is done after receiving invoice
Page 58
Transaction codes
•ME51N – Create PR
•ME52N – Change PR
•ME53N – Display PR
RFQ
•ME41 – Create RFQ
•ME42 – Change RFQ
•ME43 – Display RFQ
•ME47 – Maintain Quotation
•ME48 – Display Quotation
Quotation
•ME49 - Price comparison
Price comparison
•ME21N – Create PO
•ME22N – Change PO
•ME23N – Display PO
Purchase Order
•MIGO – Goods Receipt /Reverse GRN
Goods Receipt
•MIR7 - Park Invoice
•FBV0 – Post Invoice
Invoice verification
Page 59
Purchase Requisition (PR) Purchase G
Purchase requisitions are internal

documents which the requestor request the Purchasing department to procure a particular
Purchase requisitions are either created manually by the department responsible or automa
When a purchase requisition is created for materials that have a material master record, the
Purchasing converts the purchase requisition into a request for quotation (RFQ), purchase
Request For Quotation (RFQ)

Purchase Order
RFQ Quotation
Source 请求报价
of Supply
Rejection Letter
Master data
Purchasing
Vendor A
Purchase Requisition 采购申请
Vendor B
Vendor C

 Create a Request For Quotation (RFQ) for the relevant material or th
 Next, allocate the required vendors to the request for quotation. The
 The RFQs are then sent to the chosen vendors, who then send their
 After receiving the quotations from the vendors, their quotations are e
 Determines the most favorable items or quotation by means of a quo
 In addition, there is an option of saving as purchasing info records the
Page 62
Quotation
1 Enter price and conditions
Vendor A
Quotation for RFQ 1
Item 10
Gross price: 400/t
Discount: 50 UNI
Vendor B
Quotation for RFQ 2
Item 10
Gross price: 400/t
Surcharge: 20%
Vendor C
Quotation for RFQ 3
Item 10
Gross price: 500/t Fixed
costs: 40 UNI
2
Compare quotation with price comparison list 用价格比较单比较报价
Steel 2 t 350/t 480/t 520/t
Price
Quotation 1 Quotation 2 Quotation 3
3
Create info record or reject quotation
Quotation
Market price
Purchase
Order
Piece
%
UNI
Rejection
Letter
Info record
Purchase Order (PO)

A purchase order is a formal request to a vendor to
supply certain goods or services under the stated conditions.
You can create purchase orders without reference, or with reference to a purchase requisiti
When you enter the purchase order data, the system suggests default values. For example
You either send the purchase order to a vendor or you carry out a stock transport order in a
Movement Types: Examples In
The movement type is a three-digit key used to

differentiate between goods movements in the SAP System. Examples of these goods mov
The movement type has important control
functions in Inventory Management. It plays a central role in automatic account determinatio
Invoice Verification: 3-Way Match

VendorInvoice
$20.00
VendorOpen Items
Invoice
$20.00
PurchaseOrder
GoodsReceipt
4.2 Outline Agreement

Contract/ Schedule Agreement
Contract/Schedule Agreement
 Contract / Scheduling Agreement are created for material and vendo
 Scheduling Agreements are similar to contracts with difference that d

(schedule lines) against these agreements have very specific and deta
A contract is a long-term
agreement with a vendor concerning the supply of material or performance of services.
Delivery of the total quantity
of material specified in a scheduling agreement item is spread over a certain period in a de
Page 68
Contract
Contracts are outline
agreements. They do not contain details of the delivery dates for each of the items.
To inform vendors of which quantities you need for which date, you enter contract release o
If an info record with conditions exists for the material and the vendor, the system automatic
Types of Contract
Quantity
contract
(MK)
Contract
Value contract
(WK)
Contract : Item Categories

Item category W is
recommended for materials belonging to the same material group but with different prices.
Item category M is
recommended for similar materials with the same price but different material numbers. Whe
1
2
3
4
5
1
Page 72
1. This cycle starts with creation of contracts, it follows with sou
2. Delivery orders / Schedule lines are created against contrac
3. Once goods arrive at plant, Goods Receipt is done against r
4. When material is procured for storing in stocks, goods is mo

Page 73
Transaction codes
•ME52N – Change PR
PR
•ME31K /ME31L– Create contract/ Schedule agreement
•ME32K/ME32L – Change contract/ Schedule agreement
•ME33K/ME33L – Display contract/ Schedule agreement
ntract/Schedule
Agreement
•ME23N – Display PO
•ME38 – Create Schedule Lines
Purchase
er/Schedule Line
•MIGO – Goods Receipt /Reverse GRN
Goods Receipt
Page 74
4.3 Service Procurement

Service Procurement
 This process covers procurement of services from
external vendors. Service procurement is handled by
Page 76
Service Procurement
1
2
3
4
5
6
Page 77
Service Procurement
1. Service Procurement cycle starts with creation of Purchase
2. Request for Quotation is created with reference to released
3. Once quotations are received from the vendors, they are en
4. Service Purchase Order is created manually or with referenc
5. Service is performed by the vendor against this PO and Serv
Page 78
Service Specifications in the Purchasing Document
You can format complex service
specifications clearly using outline levels. You can assign any number of service lines to ea
Work that is not contained in the
outline or service lines cannot be covered with value limits for unplanned services.
Service Entry Sheet and Acceptance of Service

The system stores services that have
been performed in service entry sheets. The relevant postings are made in Financial Accou
When entering services, you reference the purchase order. You can copy planned services
The system checks whether the unplanned services adhere to the limit defined in the purch
You can set up release procedures for service entry sheets.
Invoice Verification for Entry Sheet S
The invoice verification

procedure is carried out with reference to the purchase order.
This means that all service entry sheets signed off for this purchase order are suggested fo
The system compares the prices on the invoice with the prices from the service entry sheet
If there are no discrepancies, you can enter and post the invoice.
If the system finds any discrepancies, it blocks the invoice for payment.
Purchase Order History – Acceptance

Service Entry Sheet
The purchase order history
lists all the follow-on activities for a particular purchase order; that is, all services that have
Transaction codes
PR •ME52N – Change PR
RFQ
Quotation
Price comparison
•ME23N – Display PO , ME9F - Print PO
Purchase Order
•ML81N - Service entry acceptance/Reverse GRN
•ML83 – Print service entry sheet
Service
ntry/Acceptance
Page 83
4.4 Import Material

Procurement
Import Material Procurement
 Import Material procurement is handled by centralized purchasing de
for various materials like steel, spares, capital items etc. required at ea
Page 85
Import Material Procurement
1
2
3
4
5
6
8
7
Page 86
Import Material Procurement - steps

1. Procurement cycle starts with creation of Purchase requisition, eithe
2. Import Purchase Order is created with reference to selected Quotati
3. If advance payment is required to vendor, then either invoice verifica
4. Inbound delivery is created with reference to PO after getting the int
5. Goods receipt (movement type 103) is done against inbound deliver
6. After receipt of physical material at plant, Goods receipt (105) is don
7. Excise credit is taken for Cenvat amount
8. Invoice verification for vendor is done after receiving invoice and cle
Page 87
Transaction codes
• ME51N – Create PR
• ME52N – Change PR
• ME53N – Display PR
PR
• ME21N – Create PO
• ME22N – Change PO
• ME23N – Display PO , ME9F - Print PO
Purchase Order
• VL31N – create inbound delivery
Inbound delivery
• MIGO – Goods Receipt/Reverse GRN
• ML83 – Print GRN
Goods Receipt
• MIR7 - Park Invoice
• FBV0 – Post Invoice
Invoice
verification
Page 88
Unit 5
Inventory Management
Goods Issue
 Goods Issue is the process of handing over the materials placed in s
various departments as per their requests. The Inventory Management
 Withdrawal of material for production orders
 Scrapping and withdrawal of material for sampling
 Return deliveries to vendors
 Other types of internal staging of material
 Deliveries to vendors without the involvement of the SD Module
 Generally goods are issued with reference to some documents like -
 Reservations
 Production orders
 Bills of material
Page 90
Goods Issue
( Start )
I
Rese1vation I Productio n Order I Ma
intenance Order I Project I Asset I
'
Goods Issue fro1n I
Storage Location I
GI{Mae1·ial) Document !
GoodsIssue Ag<""l inst Cost Center
Start
Cost Center
Goods Issue fro 1n

Storage Location
f----+- GI{Mae1·ial) Docume nt
1
Print Ex cise Invoice
Sto 1>
Page 91
Goods Issue
 If a reference document (reservation/order) exists, it is important to e
 The goods issuing department can check whether what was requeste
 During entry of goods issue, the system can suggest data from the re
 After a withdrawal, the quantity withdrawn is updated in the reference
 If reference documents are not available then Goods can be issued f
 Cost Center
 project
 Asset
Page 92
Goods Issue
 Reservation
 The Request to Stores to reserve a material for future use on a partic
 Reservations will be created automatically from Maintenance order, P
 Offline approval will be obtained prior to creating reservation manuall

 The Goods Issue will be always done with reference to Reservation.
 Cost Center
 The Request to Stores request a material for it’s from store without cr
 The Goods Issue in such case will be posted as consumption directly
Page 93
Transaction codes – Goods Issue

RFQ
Quotation
Price comparison
Purchase Order
Service
ntry/Acceptance
Page 94
Stock Transfer & Transfer Posting

 This process is used to remove materials from storage in one storage
and place them in another storage location. Stock transfers can occur e
 There are three different procedures for carrying out a stock transfer:
 Stock transfer via stock transfer posting using the one-step procedure
 Stock transfer via stock transfer posting using the two-step procedure
 Stock transfer using stock transport order
Page 95

[ Manual
lJ-. Pu.-chase R ec1uishion ,_ _
MRP/ PS/ PM
Release Strategy
C Release E
NO
Purchase Order P r n tin g PO
s_t_r_a_t_e_g_y
....;;:- ----_..
Gene.-ation
(For Stock Transfe1-)
Material Supply fro1n
Sup1>lying Plant
Manual Gate Entry
Goods Issue f.-on-.
Supply ng Plant
Excise Invo ice
Phys calReceipt of Material at Receiv ng Plant
14-------1
GR Docu111ents
Goods Receipt at Receiving Plant
Invo ice Ve 1·fication
fo.- Tra nspone.-
Transfer Posting to
Stores
CENVAT Credit
Page 96

 Stock Transfers
 The Receiving Plant will create the Stock Transport Order on the Issu
 The Raw materials from Issuing plant / Port to any plant will be transf
 Once goods arrive at plant, Goods Receipt is done against stock tran
 The material will be valuated at the receiving plant when the good are
 Transfer Postings
 Transfer postings will occur for carrying out conversion of Stock to a d
 If reference documents are not available then Goods can be issued fo
Page 97
Transaction codes – Stock Transfer

RFQ
Quotation
Price comparison
Purchase Order
Service
ntry/Acceptance
Page 98
Unit 6
Special Procurement
Special procurement Process
Four Types of special procurement process
 Consignment
 Subcontract
 Pipeline
 Returnable Transport Package
Page
###
Unit 6.1 Consignment

Procurement
Consignment Procurement
 This process is the management of vendor’s stock in company prem
inventory is valued in the books of the vendor. The materials will be dire
Goods Issue
 Request for issue of vendor-managed inventory (VMI) will be a reser
 The issue of Consignment stock will be done with reference to a rese
 The material will be directly issued for consumption from the Consign
 The settlement of liabilities of vendor will be carried out on the basis o
Page
###
 Transfer to Own Stock
 The goods from vendor is received against the Purchase order and c
 The goods from the Consignment will be transferred to own stock thro
 The above process will be done under specific considerations. For e.
After a fixed period based on the contract with the vendor.
 Returns to Vendor
 Vendor-managed materials will be returned to vendor if the material i
 The return to Vendor will be carried out with reference to the Purchas
order against which it was received.
Page
###
 The materials which are already issued to consumption will be return
 The Cenvat credit will be reversed for the Cenvatable materials retur
 A debit note will be raised if the settlement is done for the vendor.
Page
###
[Manual l=t--
MRP / PS/ PM I
Start
'----------' Pu.-chase Req1uis tion i----
Release E NO
---_•_•_a__e_g_y
T1-ansn-.ission of
RFO
Qu otati on Received
fron'l Ve ndors
Qu otation
Maintenance and
Price Co1npar-ison
Pu.-chase Or-de.
Gene.-ati on
{VVith he n-. Cate go1y
- ----•a__e_g_Y
-" ----------<::.
YES
Pricing P O /
t- -----------Re1ninde.- L ette1sI
Physical Receip'I at
Pl ant
T.-a11s1niss o11
Manual Gate Ent1y
Goods Receipt a'I
Receivin g Plant
GR Docu1nents
Invoice Ve rificatio 'I
YES Tr-ansfe.- Posting to
Consignrnent. Stock
Payn-.ent to
Trans1>0 1-re1·
NO
Tra nsfer- Postin g to
Unr-e'Sl"r cted Use
S t ock
Ret:u.-n 1:0 Vendor- Invoice Ve.-ificadon:
Pe.-iodi c Settle1nent
S•op
Page
ExciseInvoice at" afte.
Goods ssue
CENVAT C edi•
###
Transaction codes – Consignment Procu

RFQ
Quotation
Price comparison
Purchase Order
Service
ntry/Acceptance
Page
###
Unit 6.2 Subcontracting

Procurement
Subcontracting Procurement
 Sub contracting process covers service procurement from an externa
For this all the materials to is sent to subcontractor with all the accompa
 In this process material is sent by respective plants to a subcontract
 Excise invoice on the goods provided to subcontractor can be handle
Subcontracting without payment of excise duty Subcontracting under fu
Page
###
Subcontracting without duty

Subc on•1..-. , c..ln9 P1 oces:s wl•hout Du"Ty Paid
MRP/ PS/ PM I
Sta 1"t
------- Pu.-c:hase Requi itio n
NO
Request for- Ouot"a'fion , ,.
T..-ansn-.iss on of
R FO
Ouo1'a'ti<> n Received
f.-01 n V e 1 · -. dors
Ouo1"a'fion
Main1"enance and P.-ice Co1n1>a.-iso n
C sRel ease -- E -------< :::::::
Pu1-chase 0.-de.
Gener-a'fion
Pr-icing PO /
Re1-ninde.- Lette..-s /
t--------------- "Tra1-.s1nissio1-.
Sending Exc se
I n voi ce
GoodsIssue 'I"<>
Ve ndor-
Issue Doc:unn1en1ts
57F4 Exc se Invoice
P.-int E>< c:i:se
Invo i ce
M a nu c..,.I Gate E nt1y Goods Recei1>t for
GR Doc:un'llents
:Sll..1bcon •racw- i ng PO
11-.voic:e Ve .-ific:a"tion
fo 1- T1·a111spo 1-.e 1·
YES
Reconci atio n
Trans1><> ner
T..-ansfe1· Post ng 'f<>
S'fo1·es
Invoice Ve1 fic:ation
fo.- Ve 111do.-
Pay 1T11e nt to Venclo 1-
Page 109
Subcontracting Procurement - steps

1. Procurement cycle starts with creation of Purchase requisition manu
2. Request for Quotation is created with reference to released purchas
3. These quotations are used for Price Comparison and short listing be
4. Purchase Order is created with reference to selected Quotation.

5. Goods issue is done for vendor against subcontracting purchase ord
6. Subcontracting challan is created with respect to goods issue docum
7. Materials are sent to the subcontractor, along with a printout of the s
Page
###
Subcontracting Procurement - steps

8. The subcontractor processes the materials and returns the finished
9. The excise department reconciles the goods receipt against the cha
10. If subcontractor fails to return all the materials within the time allotte
11. Invoice verification for subcontractor is done after receiving invoice
Page
###
Transaction codes – Subcontracting with

RFQ
Quotation
Price comparison
Purchase Order
Service
ntry/Acceptance
Page
###
Subcontracting with duty

Sub con1:r acting P1 ocess whh Dufy P.-.. .ld
Monuol l
S'tart
-------- Purchose
MRP/ PS/ PM
C Release E
Rec1uish on o- --
NO
- St.-ategy -
R ec1ue f"o.- Ou o"tation t- ---- Tra nsn... ss on of
RFQ
Qu otation Rece ived

f"rorn Ve ndors
Q U Ot4:1•i <> n
Main1:enance and
Pi-i ce Con'llpariso n
Release E
Purchase Or-cler
Generati on
NO
C s_•a__e_g_Y _-:-----..-<::
,_
P.-ic-ing PO /
Re1ninde r Letters /
T.-onsrniss on
Issue Docun-.ent:s
Sending Excise
Inv ice
Ca1>ture Exise
Du-.y Paid Excise
Invo ice
Invoice Prin1: Excise
Inv< > c-e
Goods R ecei p• fo.

subcon'traC"t"ing PO
GR Doc un ne n ts
Invoice Ve1ification
for- T.-ansporte.-
YES
CENVAT Crei1"
Payn'llen"t 1:<>
T1·a111sp o1-.e1·
NO
Tra nsfer Post"ing "t<>
Stores
Invoice Ve rification
for- Vendor-
Page 113
Subcontracting with duty - steps

1. Procurement cycle starts with creation of Purchase requisition manu
requesting department.
2. Request for Quotation is created with reference to released purchas
3. These quotations are used for Price Comparison and short listing be
4. Purchase Order is created with reference to selected Quotation.
5. Goods issue is done for vendor against subcontracting purchase ord
6. Duty paid excise invoice is created with respect to goods issue docu
7. Materials are sent to the subcontractor, along with a printout of the e
8. The subcontractor processes the materials and returns them, togeth
Page
###
Subcontracting with duty- steps

9. GR is done against scheduling agreement/purchase order after man
10. The excise clerk captures the subcontractor’s excise invoice, using
11. Invoice verification for subcontractor is done after receiving invoice
Page
###
Transaction codes – Subcontracting with

RFQ
Quotation
Price comparison
Purchase Order
Service
ntry/Acceptance
Page
###
Unit 6.3 Pipeline

urnable Transport
kage (RPT)
Returnable Transport Package
 Returnable transport packaging (RTP) is a multi-trip packaging mediu
example, pallets or containers) in which goods can be transported more
 Returnable transport packaging from a vendor that is stored at a loca
our premises is managed as special stock and clearly assigned as belo
 Following transactions are used for RTP –
 Transfer posting is done for trolley while goods are dispatched (move
 Transfer posting is done for trolley while goods are received (moveme
Page
###
Returnable Transport Package

Returnable Packa' Mate1fal Management
( Srnn
!
Physical Sending of Tmnsfer Posting for Returnable Goods
Trnlley Trolley Issue Document
Physical R ecei11t of . Goods R ecei11t of

Trnlley
Trolley
( Sto11
Page 120
Transaction codes – Returnable Transport Pa
RFQ
Quotation
Price comparison
Purchase Order
Service
ntry/Acceptance
Page
###
Unit 8
Physical Inventory
Physical Inventory
 This process covers counting of company’s warehouse stocks for ba
sheet purposes. Physical inventory can be carried out both for a comp
 The stock in a warehouse can be divided into stock types. In the stan
system, a physical inventory can be carried out for the following stock t
 Unrestricted-use stock in the warehouse
 Quality inspection stock
 Blocked stock
Page
###
Physical Inventory
 Inventory of all stock types mentioned can be taken in a single transa
For the materials to be inventoried, one item is created in the physical i
 If a material does not exist in a storage location, this means that no g
 Physical Inventory Procedures
SAP R/3 supports the following physical inventory procedures:
 Periodic inventory
 Continuous inventory
 Cycle counting
 Inventory sampling
 Blocked stock
Page
###
Sta n
[ Manu al ]}-
Creation of Physica l
Pri nting PIO
Batch Process for PIO
creation
Inventory Docu m ents
E nter th e Count
Recount
NO
Ap1u·ova l fro 1n Head 1-N_o .
Operations
YE S
Post Differen ces Print Oocu1nents
Post Excise Loss
Stop
Page 125
Physical Inventory - steps

Physical Inventory Process
Regardless of the physical inventory method, the process of physical in
1. Physical Inventory Preparation

Create a physical inventory document. Blocking Materials for Posting
Print and distribute the physical inventory document.
2. Physical Inventory Count Counting stocks
Entering the result of the count on the physical inventory document prin
3. Physical Inventory Analysis
Entering the result of the count into the system Initiating a recount, if ne
Posting inventory differences
Page
###
Transaction codes – Physical Inventory

RFQ
Quotation
Price comparison
Purchase Order
Service
ntry/Acceptance
Page
###
Unit 9
Material Requirement Planning
Unit 10
ion and Account
ssignment
Unit 11
Batch Management
Unit 12
Invoice Verification
Invoice VEl'ification
Payment
Requisitio
Requirement detennination
rrrr=r--,_1
rr--rl
Source detennination
•·1 ,•I I
- • j{J.J
-
.. ..
Goods receipt Vendor selection
Purch.order
###
:20
###
Ill Purchase order monitoring Order processing
Invoice Verification: 3-Way Match

VendorInvoice
$20.00
VendorOpen Items
Invoice
$20.00
PurchaseOrder
GoodsReceipt
Vendor
Purchase order
bESAG
Oberseering 110
22045 Hamburg April 7,1999 Document date
With reference toyour purchase order 45000895 from March 3, 1999,we delivered the following goods:
1,000 pcs
300 kg
Tax amount
Invoice amount
Unit of measure
Payablewithin 20 days of invoice date.
2% cash discount for payment within 10 days
Tax rate
Payment conditions
Acct no.11223344,MBS Bank (code 300 210 "4------t--, Bank information
Invoice
Item:
1 _ ..
Delivery note number
2 _
3 _
Purchase order
no.4500012345
GR 2 GR 3[flill
Material A
Material B
10001L....--:1
2000 1 -...
- -- -----;
Material C
###
Tax amount
Calculate tax
###
Tax code 11
5°10 tax 150
10°10 tax 400
7750
Item list
Amount Tax code
1000 51
2000 51
4000 11
A
B
c
amount
###
###
code
###
###
amoun
###
###
Purchase order item
Last used tax code
10 pcs at $63/pc.
Ex. rate M2
Fixed ex. rate
PO currency
Local currency
UNI
###
rsion using PO ex. ratel
D
Conversion using current ex. rate I
ki 11
10 pcs
lnyojce
10 pcs
at $63/pc .
= $630
Li 11
lnyojce
10 pcs
at $63/pc .
= $630
Current ex. rate
or
entered ex. rat
315 UNI 315 UNI 350 UNI 300 UNI

Exc hange rate differences
Purchase
Invoice order
,
Goods receipt
Tolerances
•
Document
no. 5100012345
created
Document
no. 5100012345
created Blocked for payment
Invoice
50 pcs
Qu a nt t y
PO i
5.00 UNI/pc.
Invoice
6.00 UNI/pc.
Pric e
Invoice
10 pcs
Goods receipt
-- 10 pcs = 230g 1-----
hase order
= 250 g
Purc
pric e quantity
PO
1O pcs at = 200 g
20.00 UNl/g
Invoice
10 pcs
= 250 g
PO
-' -1 delive
Invoice
date ,_M_a_Y.....- -------------1

. _,,
April 11
Tolerances for:
e
Company code 1000
Amounts in UNI
Absolute lower limit
No check X Check limits
Absolute upper limit
No check
Check limits X above value 10.00
Percentage lower limit
No check
Check limits X above 20.00 °/o
Percentage upper limit
No check
Check limits X above 5.00 O/o
Invoice
for PO4151599003
100 pcs R244-11 4000.00
pcs R266-10 2000.00
Item list
Material
D
Qty Amount Ma Purch.order Item
7 R244-11
R262-10
000 D 4151599003 20
00 4151599003 50
------
At item level
Payment
Payment method _ Payment block
t
..
At header level ---
Unit 13
MM Intergartion
Unit 14
Country version of India (CIN)
Unit 15
Real Time Scenarios
Release Procedure
 Procurement cycle starts with creation of Purchase requisition
 Request for Quotation is created with reference to released pu
 These quotations are used for Price Comparison and short list
vendor.
 Purchase Order is created with reference to selected Quotatio
 Once goods arrive at plant, Goods Receipt is done against res
Purchase Order.
 Invoice verification for vendor is done after receiving invoice a
clearance from Quality for payment.
Page
###
Purchase Goods and Services
sification)
---- ...........
PO
em 10
.........
Approval
,. (o.k.) (.() ....... ....,.
20 o.k.
./ 1----.. Item 10
###
tern 10
###
###
......_,_,. ._<o_._k_.) _,·····-····..,.
...,.__...,.
Approval
o.k. ./
Indi vidual rel ease

Collective releas,e
PReg.
Item 10
Release point
I- o.k. ./
PReg.
Item 10
Release point
o.k. ./
,.__.
Starting situation
Effect releases (signify approval)
Release
point 1
o.k. ./
Releas.e
point 2
o.k. ./
Release
point 3
o.k. ./
Release
point 4
o.k.
PReg.
Item 10
+ + +
Convert requisition
into RFQ
RFQ
Sch. agmt.
Contract
Pur. order
I
I
: Message
###
30 o.k.
-----.1·
I

Value
Plant
Customizing:
Definition Release strategy
Strategy S1
Value from 10,000 Plant 1000
Create requisn.
Requisn.:. Item 10
Strategy S1
blocked
Release points Release status ]
CJI:] 1. Engineering Blocked I
2. Purchasing -.Released for RFQ I
3. Controlling -+ -
,
Re leased for PO =1
Release code = Release point
= Release status
Controlling
Department
echnical Services
Department
PReq
Release CO ../
TK ../
Release TK
Smith
ect
User
authorizations
Aut horization object
M_EINK_FRG
User
authorizations
Authorization obj
M_EINK_FRG
Value: TK
Agenda: Materials Management (Day 1 – 19 April)
1. Course Objectives 2 mins
2. Business Cycle: Introduction to Material Management 10 mins
3. Enterprise Structure 15 mins
4. Purchasing Group 5 mins
5. Purchase Goods and Services 1.5 hr
 Request for Quotation (bids)
 Purchase Requisition
 Purchase Order
 Contracts
 Item Categories
 Release Procedure (Approval)
6. Inventory Management 10 mins
 Receipts of Goods and Services
7 Invoice Verification 20 mins
8 Service Entry Sheet 30 mins
 Acceptance/ Rejection of Services from Contractors

 Invoice Verification for Entry Sheet
- ""!!
•Vendor •
•invoice
•
Requisitio
Requirement detenni nati on
Source detennination
Purch.order
10
20
30
Order processing
Purchase order monitoring

GR
slip
1
2 ---
3 ---
. 11
-· -
Goods receipt to the warehouse
- ..,
":..J
11
'( ,· -
Return delivery to the vendor
y Management
Goods Receipt for Purchase Order Assigned to a Consumption Accoun

Goods Receipt
Automatic
Issue
Consumer
2 swivel chairs
for Cost Center 1
Setting the “Delivery Completed” Indicator
Set “Delivery Completed” Indicator

At time of
Goods Receipt
In the
Purchase Order
Under - and Over-delivery
Purchase Order Quantity 100
Underdelivery
No Message
within the
Overdelivery
Tolerance Tolelerraancce Ran g e Tolerance
20% 20%
70 80 90 100 110 120 130 140
Underdelivery
Warning
Overdelivery
Error Message
 Purchase Order
 Contracts
 Item Categories


 Purchase Order
 Contracts
 Item Categories

Service Entry Sheet
Purchase order # 12345J an. 27
Purchase order # 12345Jan. 27
Item 10 I Repair printing press

• Detailed description of service ?
• Order quantity ?
• Acct assgmt ?
S E_
Item 10 I Material Steel • 01
Order quantity : 250 pcs
Climo_sit_ts_co_nt_ro_l_v_i_a '•
Service entry sheet Feb. 3

Item 10 I
Feb. 3
Oil filter changed
I Limit adhered to ?I I Release procedure I IAcceptance j '
GR for PO 12345, item 1O

Service Entry Sheet
Purchasing document
Header • General data
• Statistics
• Messages
• Conditions
Item
• General description:
Software implementation
• Date: Oct. 31
Service
lines
Specs
• Description of service
• Qty
• Conditions
1. Review 20 mins
2. Returns to Vendor 30 mins
 Return Purchase Order
 Credit Memo
3. Key Master Data 40 mins
 Vendor Master
 Material Master
 Purchase Info Records (Purchase price)
 Source List/ Contract (Approved Vendors – PVL)
 Service Master
4. Safety Stock Planning 30 mins
5. Compliance Document Review with MapleTree Users 1 hr
Returns to Vendor
Return for
purchase
order
urchase order:
aterial Short text PO qty @
10 x
###
Returns
indicator
oods receipt for a purchase
rder:
aterial TM510-01 MVT 161 aterial TM520-01 MVT 101
Trans.
+
Reversal (Reversing Entry) - Return Delivery
Returns to Vendor
Reversal
Reason for Movement (Mandatory entry)
Reason for Movement (Optional entry)
 (e.g., Wrong Storage Location)

xxx xx xx xx
xxxx x xxx xxxxxxxx xxx x
 (e.g., Damaged Material)

xxxxx xxxx
xxxx x xxx
With Return
x Delivery Slip
Without Return
Delivery Slip
xx xxxxxx x
return del
to the vendor with the material which is being sent

back.
xxxxx x xx xxx
xxx
REtums to Vendor
order
100 pcs
10.00 UNI/pc.
Invoice
80 pcs
800 UNI
Credit memo
30 pcs
300 UNI
Create
credit memo
PO 4151599035
order
50 pcs lnyojce
PO 4151599036
50 pcs
800 UNI
Credi t memo
PO 4151599036
50 pcs
300 UNI
Create
subsequent credit
###
100 pcs
10.00 UNI/pc.
PO 4151599036
1. Review 20 mins
 Credit Memo
 Vendor Master
 Material Master
 Service Master
1. Review 20 mins
 Credit Memo
 Vendor Master
 Material Master
 Service Master
Safety Stock Planning: Consumption-Based Planning
Safety Stock Planning
Planning Procedures
MRP
Consumption-Based
Planning
Reorder Point
Planning
Forecast-Based
Planning
In MRP, the system compares available stock plus planned receipts with demand. If the ava
quantity is less than the required quantity at a point in time, then an order proposal is create
Maximum Stock level
Reorder
point
Safety
stock
Lot size
Reorder point Delivery time Time
Replenishment
lead time
1. Review 20 mins
 Credit Memo
 Vendor Master
 Material Master
 Service Master
About Deloitte
Deloitte refers to one or more of Deloitte Touche Tohmatsu, a Swiss Verein, its member firms and their respective subsidiaries and affiliates. D
services in all four professional areas.
As a Swiss Verein (association), neither Deloitte Touche Tohmatsu
nor any of its member firms has any liability for each other’s acts or omissions. Each of the member firms is a separate and independent legal
“Deloitte Touche Tohmatsu” or other related names.
Copyright © 2008 Deloitte Consulting. All rights reserved.
process
o use a system of integrated applications to manage the business and
processes, often in real-time, using common databases maintained b
eloped by the German
ess functions of an organization. The latest version (SAP ERP 6.0) was
Operations (Sales &
nning, Logistics Execution, and Quality Management) Financials (Fina
duction : 1992
client/server model.
d sapgui.exe. It is usually installed on a user’s workstation.
llectively interpret the ABAP/4 programs and manage the input and ou
ables all start at the same time.
cept database requests from the application server. These requests ar
l the systems are linked to different transport routs to main system, sys
QAS and PRD.-
uration, 120- development, 130 - Unit Test.
ntegration Test, 210 to 240 Training.
o manage software updates, termed transports, on one or more conne

d they are created when
system.
k like ABAP programs, custom tables, etc. that your ABAP developmen
ent and workbench is client-independent transports.
Consultant
s that engage in large volumes of purchasing by giving them hands-on control of invento
purchase with vendors
its own profit and loss

An organizational
materials planning aspects.

e database for a long period of time. These are stored centrally and used and p
are the most important
all materials that an
t the vendors that

al vendor master records
nt Process Master Oata

Master Data
omponents in the SAP System.

at the problem of data redundancy is not an issue. The stored data can be used by all areas, such a
following functions in the SAP Logistics component: Ordering in Purchasing , Updating movement a
Level Master Data
so that you can manage the material data in your enterprise centrally, without overloading your data
any is stored at client level.
ocations in it, is stored at plant level.
location is stored at storage location level.
d: Screens Master Data
want to process. In the second, you specify the relevant organizational levels. You then go to the da
cally choosing them from the menu bar.
Master Data
ecord has its own unique material number.

an use User Exits to change material numbers as required.
ntrols things such as screen setup, screen sequence, procurement type or number assignment
so controls screen setup and screen sequence.
Master Data
plies, equipment, services, etc.The material type controls:
which order.
anagement requirement; that is, whether the system updates quantity changes in the material maste
erial is posted to stock or leaves the warehouse.
ue Updating Master Data
ge) or for consumption.
pe. In this case the value is posted to consumption account (and an Accounting object).
manage a separate stock account for each material.
d for a material depends on the material type, and can be configured in Customizing.
determine which stock account is to be updated upon goods movements.
Master Data
System, material valuation can be carried out according to the moving average price procedure (V p
all stock postings at a price defined in the material master.
ates goods receipts with the purchase order price and goods issues with the current moving averag
directly to the relevant stock account if there is sufficient stock coverage.
about the vendors

in individual vendor master records
example.
ation account and the payment methods for automatic payment transactions. T
nd the vendor's tax data.
Masle<Data
ational Level Master Data
record is therefore maintained by Accounting and Purchasing.

aintenance should be organized in the vendor master record.
d Accounting- specific data centrally or de- centrally. In addition, Purchasing often maintains data at
Group Master Data
olling characteristics.
ocure a material once or very rarely. These are called one-time vendor master records and, in contr
Master Data
e system automatically goes to an additional data screen. This is where you enter specific data, such
f vendors. You normally use one-time master records for “one-time” vendors.
er Record Master Data
levels “client” and “purchasing organization”. Control parameters for purchasing operations are defin
ly for a specific plant.
Master Data
the procurement transaction the vendor is the order recipient, then the supplier of goods, the invoic
te one or more of these roles among different vendor master records.
t a vendor and a
vendor. An info record thus represents a material-vendor relationship.
Master Data
uyer, enabling him or her to determine via list displays which vendors offer a particular material, or w
data (for example, contacts) Texts.

contracts), the system displays data maintained in info records as default values.
e Master Data
ery plant.
for the relevant purchasing organization or relevant plant. You configure whether conditions are perm
d for the purchasing organization/plant combination. If there is no such info record, the system searc
fo Records Master Data
eements.
eement Master Data

nt f plant not
ply for a material

in which a material may be ordered from a given vendor or under a ce
Master Data
purchase agreement.
tion for Purchasing. It contains data on a certain material and the vendor (supplier) of that material.
or regarding the supply of materials or performance of services according to predefined terms and co
Master Data
unction is useful in the case of a source list requirement (use of source list mandatory).
ertain period. Each source is defined in the source list by a source list record.
dity period. Only one fixed source may exist for a material within a certain validity period.
are not taken into account in source determination.
a source list record is taken into account in materials planning.
urces other than those included in the source list. A source list requirement can be specified either fo
ord or outline agreement item.

for an individual material (individual procedure).
ows you to simulate the effects of the source list creation.
m category “D” (Service).
l Group Master Data
ds for a material
W (material group).
ased against a contract item with item category M or W.
owed materials (inclusion of materials). To exclude materials, you must retain the standard setting o
Master Data
with the item category M (material unknown) or W (material group).

ased against a contract item with item category M or W.
owed materials (inclusion of materials). To exclude materials, you must retain the standard setting o
Master Data
Conditions Master Data

rement
hasing
tions for various materials like steel, spares, capital items e
rement
ase requisition manually by the requesting department or MRP.
to released purchase requisition and is to be sent to desired/short liste
ndor .
ected Quotation.
one against respective Purchase Order.
ving invoice and clearance from Quality for payment.

cure a particular quantity of a material or a service for a particular date.

onsible or automatically by MRP (for stock managed items only).
master record, the SAP System will transfer the data in the material master record onto the purchase
RFQ), purchase order, or outline agreement.
rement
material or the required service. The request for quotation can be created: Ma
uotation. The system determines the address from the data in the respective v
en send their quotations or rejection letters.

uotations are entered along with the conditions (e.g. prices, discount, surcharg
eans of a quotation comparison (e.g. price comparison).
fo records the conditions of quotations. Purchasing info records here refers to
450/t
n3 Mean value
purchase requisition, a request for quotation, or another purchase order.
ues. For example, it suggests the ordering address, as well as the terms of payment and freight (inc
ansport order in another plant belonging to your company or group. With a stock transport order, you
these goods movements are goods receipts, goods issues or transfer postings.
count determination in the SAP System. Together with other influencing factors, the movement type d
ial and vendor, on quantity or value basis and will have predefined validity per
ference that delivery orders

cific and detailed delivery schedules in terms of time and quantity of deliveries
e of services.
ain period in a delivery schedule, consisting of lines indicating the individual quantities with their corr
h of the items.
contract release orders for a contract. A release order is a purchase order that references a contra
system automatically suggests the net price according to these conditions when you create the co
different prices. When you create the contract item, you enter the short text and the material group,
ial numbers. When you create the contract item, you enter the short text, material group, quantity an
ows with source list is updating for material and vendor combination so
ainst contracts, either manually or via MRP.
one against respective Release Order / Schedule Line. At this time all g
goods is moved to respective storage locations, or else, when materia
ving invoice and clearance from Quality for payment.

ces from
andled by purchasing department of each plant at respecti
of Purchase requisition, either manually by the requesting department o
to released purchase requisition and is to be sent to desired/short liste
they are entered into system with all terms and conditions as specified
with reference to an approved purchase requisition.
PO and Service Entry Sheet is created to confirm the quantum of serv
ving invoice from vendor and acceptance of service entry.
ocument Service Entry Sheet

ervice lines to each outline level.
services.
rvice Service Entry Sheet
n Financial Accounting and Cost Accounting when the service entry sheets are signed off. Service en
planned services directly from the purchase order into the service entry sheet. You do not give an ex
fined in the purchase order.
eet Service Entry Sheet
are suggested for invoice verification.

ervice entry sheets.
tance
ervices that have been performed, entered, and written off, and all invoices that have been entered.
purchasing department
equired at each plant.
eps
quisition, either manually by the requesting department or via MRP.
ected Quotation.
nvoice verification is done or payment is done through down payment request
getting the intimation from vendor for shipment of the material.
bound delivery after receipt of the material in bonded store at port. Invoice ver
pt (105) is done against import PO.
nvoice and clearance from Quality for payment

als placed in stores to
Management in MM module system supports the following types of goods issu
Module
uments like -
mportant to enter the goods issue with reference to this document, for the follo
was requested is actually issued.
ta from the reference document (for example, account assignment, requested
the reference document and the reserved quantity is reduced accordingly. Thu
an be issued for consumption against
se on a particular date will be made through a reservation.
nance order, Production Order or manually for material requested against brea
ation manually.
Reservation.
ore without creating reservation.
mption directly against cost center.

in one storage location
rs can occur either within one plant or between two plants. Whereas, a transfe
stock transfer:
tep procedure
tep procedure
er on the Issuing Plant / Port.
will be transferred with reference to Stock transport order.
nst stock transport order. Transporter Code is entered while doing GR.
n the good are issued from the sending plant.
of Stock to a different Stock Type and to convert one material to another.
n be issued for consumption against

ompany premises. The
als will be directly issued for consumption from the vendor’s stock or will be tra
will be a reservation.
ence to a reservation.
m the Consignment stock.
on the basis of the issues for consumption.
se order and classified as Consignment stock. The Receipt into consignment s

own stock through transfer posting. Accounting entries are posted during this t
ations. For e.g.
the material is not required by the company, material is rejected in shop floor
o the Purchase
will be returned after reversing the issue transaction which will bring the stock
materials returned from Shop floor.
he vendor.
nt Procurement
om an external vendor.
l the accompanying documents, which is subsequently processed by subcont
a subcontractor and handled by purchasing department from each plant at res
can be handled in following two ways –
cting under full payment of duty
teps
quisition manually by the requesting department.
ased purchase requisition and is to be sent to desired/short listed vendors.
short listing best vendor.
Quotation.
g purchase order
s issue document. This is the consignment document that will be sent to the s
intout of the subcontracting challan.
teps
s the finished goods. When the goods are delivered back to plant, the store pe
gainst the challan, thereby accounting for the return of the materials that were
he time allotted as per law, the material is scrapped by specifying it as such in
eiving invoice and clearance from Quality for payment.
ting without duty

quisition manually by the
ased purchase requisition and is to be sent to desired/short listed vendors.

short listing best vendor.
Quotation.
g purchase order
ds issue document.
intout of the excise invoice.
s them, together with another excise invoice.
rder after manual gate entry. Transporters code is entered while doing GR. Ma
nvoice, using the purchase order as the reference document. The excise supe
eiving invoice and clearance from Quality for payment. Simultaneously, invoice
ting with duty

ckaging medium (for
nsported more than once between vendors and customers.
ored at a location on
signed as belonging to the vendor. It is the property of the vendor and is theref
atched (movement type 541)

ived (movement type 542)
nsport Package
stocks for balance
h for a company’s own stock and for special stock. Inventory for a compan
es. In the standard
owing stock types:
a single transaction.
the physical inventory document for every stock type. Physical inventory take
eans that no goods movement has ever taken place for the material in the stor
of physical inventory can be divided into three phases:
for Posting
document printout
recount, if necessary
ventory
300 UNI
rate differences
e requisition manually by the requesting department.
released purchase requisition and is to be sent to desired/short listed
and short listing best
ted Quotation.
e against respective
ng invoice and
·-····..,. 20
mption Account
ce
emand. If the available
proposal is created.
ubsidiaries and affiliates. Deloitte Touche Tohmatsu is an organization of member firms around the world devoted to excellence in providing professional se
ate and independent legal entity operating under the names “Deloitte”, “Deloitte & Touche”,
usiness and automate many back office functions related to technolog
maintained by a
ERP 6.0) was made available in 2006. The most recent Enhancement
ancials (Financial Accounting, Management Accounting, Financial Sup

input and output for them.
e requests are passed on to the RDBMS (Relation Database Managem
n system, system landscape may vary from company to company or b
r more connected SAP systems.

development team does in your system.
ontrol of inventory management, batch management, purchasing, client categorization,
and used and processed on a cross- application basis. This prevents the multip
y all areas, such as purchasing, inventory management, materials planning, invoice verification, and
dating movement and consumption of material and managing the physical inventory in Inventory Ma
loading your datasets with redundant information.
u then go to the data screens.
r assignment
the material master record or updates changes in value in the stock accounts in Financial Accountin
ce procedure (V price) or the standard price procedure (S price).
nt moving average price. The system automatically calculates the latter upon every goods movemen
transactions. This is maintained at company code level.

maintains data at corporate group level.
ords and, in contrast to other master records, you can use a vendor master record for several vendo
specific data, such as the vendor's name, address, or bank details.
perations are defined at the purchasing organization level.
goods, the invoicing party, and finally, the payee.
relationship.
ular material, or which materials can be procured from a particular vendor.
conditions are permitted at plant level.

the system searches for the purchasing organization only.
or under a certain long-term purchase agreement.
) of that material. For example, the vendor’s current price for the material is stored in an info record.
fined terms and conditions. The latter apply for a prearranged period and a predefined total purchas
e specified either for an individual material (in the material master), or for all the materials of a plant (
standard setting of the exclusion indicator. To include materials, you must deselect the exclusion ind
standard setting of the exclusion indicator. To include materials, you must deselect the exclusion ind
pital items etc. These materials will be procured for stocking
red/short listed vendors.
onto the purchase requisition. Data such as unit of measurement, description of the material, purch
be created: Manually (i.e. not referencing any document) or With reference to a
e respective vendor master record.

ount, surcharges, freight, custom duty, etc. which are given by the vendors) an
here refers to the negotiated conditions agreed between the buyer and the ve
nt and freight (incoterms) from the vendor master record. If you have maintained a material master f
ansport order, you can take into account the associated freight costs in the purchase order.
e movement type determines which stock or consumption accounts are updated in Financial Accoun
ed validity periods.
y of deliveries.
ties with their corresponding planned delivery dates.
eferences a contract.
ou create the contract item.
he material group, but no price. This and the material number are not entered until a release order is
group, quantity and unit of measure, but no material number. This is not specified until a release ord
ombination so as to enable automatic schedule creation via MRP.
this time all goods receipt are checked for correctness with respect to
when material is procured to be consumed directly, it is shown as consu

at respective locations for various objectives like constructi
department or through Project Systems and Plant Maintenance modu
red/short listed vendors
s as specified by the vendors. These quotations are used for Price Co
ntum of services performed.

ned off. Service entry sheets can be entered and signed off in one transaction or in two steps.
u do not give an exact description of unplanned services or their quantity and price details until you e
ve been entered.
yment request.
ort. Invoice verification for vendor is done for payment.

s of goods issues:
ent, for the following reasons:
ent, requested material, quantity, etc.). This simplifies both data entry and chec
ccordingly. Thus, Inventory Management can monitor the withdrawal process a
d against breakdown and stock transfers between plants.

reas, a transfer posting refers to a change in a material’s stock (for example, r
ng GR.
another.
ck or will be transferred to Blue Scope Steel’s stock.
consignment stock will not be valuated.

ed during this transaction and the stock is valuated.
d in shop floor or the material is needed by the vendor for his own use.
bring the stock back into Consignment stock. This case is applicable in case o
ed by subcontractor and finished product is sent back.
ch plant at respective locations.
ed vendors.
e sent to the subcontractor along with the materials that are to be processed.
t, the store person posts the goods receipt and the challan.
ials that were sent for subcontracting.
g it as such in the bill of material for the parent material then assigning the bill
ed vendors.
doing GR. Material goes to quality if required.

he excise supervisor posts excise invoice.
eously, invoice verification for transporter is done.

r and is therefore not included in the customer’s valuated stock. RTP stocks fr
for a company’s stock and for special stocks (such as consignment stock at c
nventory takes place at storage location level. A separate physical inventory d

erial in the storage location. The material, therefore, has never had any stock i
d/short listed vendors.
n providing professional services and advice, focused on client service through a global strategy executed locally in nearly 140 countries. With access to th
ated to technology, services and human resources.
nt Enhancement Package (EHP7) for SAP ERP 6.0 was released in 20
ng, Financial Supply Chain Management) and

abase Management System).
to company or business to business.

client categorization, valuation, invoice verification
prevents the multiple storage (redundancy) of data.
nvoice verification, and so on.
ventory in Inventory Management, Posting invoices in Invoice Verification
s in Financial Accounting.
n every goods movement by dividing the total value by the total stock quantity.
ecord for several vendors. Therefore, no vendor-specific data is stored for one-time vendors. You ca
stored in an info record.
redefined total purchase quantity or value.
he materials of a plant (using a Customizing parameter).
select the exclusion indicator.
select the exclusion indicator.

ed for stocking at respective plants and also for consuming
n of the material, purchase order unit, currency, etc. will be copied from the reference material maste
With reference to a purchase requisition PR. The second option (creation with
by the vendors) and delivery dates they contain with reference to the correspo
e buyer and the vendor for a particular material or service.

ned a material master for a given material in the SAP System, the system suggests the material sho
urchase order.
ted in Financial Accounting. The movement type also determines the format of the screen when you
d until a release order is created against the contract.
cified until a release order for such a material is created against the contract.
on via MRP.
s with respect to quantity etc.
s shown as consumed.
like construction, maintenance and cleaning etc.
intenance module.
sed for Price Comparison and short listing best vendor.

n or in two steps.
price details until you enter them.
ata entry and checking (over deliveries and under deliveries) when entering a
thdrawal process and Materials Planning can update the stock/requirements li

ock (for example, release from quality inspection, accepting consignment mate
s own use.
pplicable in case of rejections at shop floor.

to be processed.
n assigning the bill of material to the subcontracting purchase order. If the scra
ock. RTP stocks from vendors are externally owned and are not valuated. RTP
ignment stock at customer, external consignment stock from vendor, or return
hysical inventory document is created for every storage location.

er had any stock in this storage location. The material does not exist at stock
arly 140 countries. With access to the deep intellectual capital of approximately 150,000 people worldwide, Deloitte delivers services in four professional ar
as released in 2013.
ne-time vendors. You can control this using the relevant field selection for account groups for one-tim
for consuming directly by various departments.
eference material master.
ption (creation with reference to PR) has the advantage that the information alr
ce to the corresponding RFQ.
uggests the material short text or the material group, for example. If a purchasing info record already
of the screen when you enter documents and how the quantity fields are updated.
s) when entering a goods issue.
ock/requirements list.
consignment material). In a transfer posting, the material can remain in its orig
e order. If the scrap generated is not returned by the subcontractor, excise du
e not valuated. RTP stock is always unrestricted-use stock. The stock can neith
m vendor, or returnable packaging) must be taken separately (in different physi
not exist at stock management level in the storage location. It is therefore not
ivers services in four professional areas – audit, tax, consulting and financial advisory services – and serves more than 80 percent of the world’s largest com
count groups for one-time vendors.
the information already in the purchase requisition is copied directly to the req
sing info record already exists in the system, the system copies a price proposal to the purchase ord
n remain in its original storage bin or be transferred. Stock transfers and trans
ntractor, excise duty relevant to the scrap generated has to be paid. If this scra
The stock can neither be in quality inspection nor blocked.
y (in different physical inventory documents).
. It is therefore not possible to carry out a physical inventory for the material in
80 percent of the world’s largest companies, as well as large national enterprises, public institutions, locally important clients, and successful, fast-growing
d directly to the request for quotation.
osal to the purchase order.
ransfers and transfer postings are used to represent organizational-relevant tr
be paid. If this scrap is returned after the duty has been paid, an excise journa
for the material in this storage location.
lients, and successful, fast-growing global growth companies. Services are not provided by the Deloitte Touche Tohmatsu Verein, and, for regulatory and ot
zational-relevant transfers within the company (for example, decentralized sto
d, an excise journal voucher should be created to reverse the excise duty paid
su Verein, and, for regulatory and other reasons, certain member firms do not provide
decentralized storage).
e excise duty paid.

Sap MM Training

Diunggah oleh

Informasi Dokumen

Judul Asli

Hak Cipta

Format Tersedia

Bagikan dokumen Ini

Bagikan atau Tanam Dokumen

Opsi Berbagi

Apakah menurut Anda dokumen ini bermanfaat?

Apakah konten ini tidak pantas?

Hak Cipta:

Format Tersedia

Sap MM Training

Diunggah oleh

Hak Cipta:

Format Tersedia

SAP MM Training

Presented by: S2S InfoTech

 Message Output determination

 Special Procurement Process

 Material Requirement Planning

 Integration with Other Modules

 Country Version India (CIN)

the end-to-ec-'ld pcocurement and II

the entir-e asset lifeicyde, improve asset

usage and cut costs with

JI rrom the MRP.

_.. and ..spandfa-.to

Which Industries are using SAP

SAP R/3 Architecture

SAP R/3 Architecture

Role and responsibility of ABAP Consult

Master Data in the Procurement Proc

Material Master: Organizational Level

Maintaining a Material Master Record: Screen

Control of the Material Type

Material Type: Quantity and Value Upda

Material Valuation Procedures

Vendor Master Record

Correspondence Withholding tax

Vendor Master Record: Account Group

Purchasing Data in the Vendor Master Record

Purchase Info Records

Purchase Info Records: Structure

Options to Maintain Purchase Info Reco

Info Update Indicator: Quotation, Outline Agreement

Creating Source List Automatically

Creating Source List for Material Group

Service Master Record

Defining Price at Service Master Conditi

Stock/Non-Stock Material Procurement

4.1 Stock/Non Stock

Stock/Non-Stock Material Procurement

2. Request for Quotation is created with reference to released

3. Receive quotations from vendors

4. Perform price comparison to choose the best vendor .

5. Purchase Order is created with reference to selected Quotat

6. Once goods arrive at plant, Goods Receipt is done against r

7. Invoice verification for vendor is done after receiving invoice

Purchase requisitions are internal

Request For Quotation (RFQ)

Stock/Non-Stock Material Procurement

 Determines the most favorable items or quotation by means of a quo

 In addition, there is an option of saving as purchasing info records the

Steel 2 t 350/t 480/t 520/t

Purchase Order (PO)

Movement Types: Examples In

The movement type is a three-digit key used to

Invoice Verification: 3-Way Match

4.2 Outline Agreement

 Scheduling Agreements are similar to contracts with difference that d

Contract : Item Categories

2. Delivery orders / Schedule lines are created against contrac

3. Once goods arrive at plant, Goods Receipt is done against r

4. When material is procured for storing in stocks, goods is mo

5. Invoice verification for vendor is done after receiving invoice

4.3 Service Procurement

2. Request for Quotation is created with reference to released

3. Once quotations are received from the vendors, they are en