Purchasing – A/P

Contents:

 Basic Procurement Process

 Additional Documents and Functionalities of Purchasing

 SAP AG 2007
 Purchasing – A/P: Unit Objectives

At the conclusion of this unit, you will be able to:

 Model the purchasing process using SAP

Business One
 Post procurement documents
 Post returns and credit memos
 Use the reporting functions to analyze your
procurement data

 SAP AG 2007
 Purchasing – A/P: Business Scenario

 You purchase your warehouse goods from external

vendors. Normally, you use the purchase order
document to order goods. In some cases, however,
you might submit your order by phone and your
vendor might deliver immediately. In this case, the
process modeled in the system must be as short and
quick as possible.
 If the delivered goods do not meet your quality
standards, you might want to return them to your
vendor. This can happen either before or after you
have received the invoice.

 SAP AG 2007
 Basic Procurement Process: Topic Objectives

At the conclusion of this topic, you will be able to:

 Model a basic procurement process in SAP

Business One
 Use the different transactions of Purchasing – A/P

 SAP AG 2007
 Document Flow in Purchasing
Target document Base document

Purchase Goods
Receipt PO AP Invoice
Order (PO)
•Create this
document as you
receive the goods. •When an
1.) 2.) 3.) incoming invoice is
•The goods received, the
•When u entered a are related accounts
PO, no value- accepted for the vendor are
Warehouse based changes are
posted in
into the posted in
Accounting
warehouse
(Quantity) Accounting. and the
quantities
•However, the are
order quantities updated.
are listed in
inventory •SAP
management. Business
One creates
•View the ordered the relevant
quantities in the postings to
General Ledger inventory status
report and the item
update the
stock
(Value) master data values as
window well

 SAP AG 2007
 Draw Document Wizard
•PO’s target doc is goods •Goods receipt PO’s base
receipt PO’s doc is PO

Purchase Goods
Receipt PO AP Invoice
Order

•If you have

copied the
base document
completely, it
will be closed
and you will not Draw Document Wizard
be able to draw
it again to
another Row Ex, Rate for Prices
document.
Use Exchange Rate from Base Document
•The only Use Current Exchange Rate from the Exchange Rate Table
exception is a
sales quotation
Draw all data (Freight and Withholding Tax)
which can be Customize
copied even if
it has been
closed.

 SAP AG 2007
 Consequences when Goods Receipt PO is created in SAP
B1

The PO (base
document) can not
be changed. Warehouse
(Quantity
The goods receipt PO
1.) can not be changed, Increasing)
because of the journal
entry 4.)
2.) The system updates
the stock situation

Purchase Goods
Receipt PO AP Invoice
Order The system creates an
accounting document
5.)
3.)
Items that have been
partially or completely General
Ledger
delivered appear in
light gray in the
purchase order
document (Value
Increasing)

 SAP AG 2007
 Consequences when A/P Invoice is created in SAP B1

1) With
reference to
the PO Warehouse
increases the
quantity and (Quantity
value of your 1.) 2) With
Increasing)
stock
reference to
the goods 2.)
3) Without any
receipt PO
reference, both the
only the 3.) quantities and
values update
values update
Purchase Goods
Receipt PO AP Invoice
Order
5) Vendor’s
6.) 6) items in the 4.) 4) You cannot account is
goods receipt change the A/P 5.) updated

General
PO that have invoice
already been

Ledger
partially or
completely
invoiced display
in light gray
(Value
Increasing)

 SAP AG 2007
 Postings in Purchasing Process for Inventory Items
goods receipt PO creates a
journal entry that post
Item Category: values of goods received to
the:
Inventory Item •debit side of the stock
account (retrieved from the
Sales Item
Inventory Account field) and
Purchased Item
•credit side of an allocation
Fixed Assets costs account. (Allocation
Costs Account field on the
Inventory Data tab of the
item master record)
A/P invoice creates a
journal entry that posts
the invoiced amount to
the:
• debit side of the
allocation costs
account and
•credit side of the
vendor account

Purchase Goods AP
Order Receipt PO Invoice

Allocation Allocation
Stock Acc. Costs Acc. Costs Acc. Vendor
100 100 100 100

• Use the allocation costs account to check if the goods receipts PO and the A/P invoices match
•To post a purchase order, choose Purchasing – A/P  Purchase Order.
•To post a goods receipt PO, choose Purchasing – A/P  Goods Receipt PO.
•To post an A/P invoice, choose Purchasing – A/P  A/P Invoice

 SAP AG 2007
 Posting Price Differences Receive the A/P invoice for the goods
receipt PO; total is 1100, resulting in a
You receive a goods receipt You sell 40% of your stock and post difference of 100
PO with a total of 1000 an A/R delivery. The system posts •The system clears the allocation costs
•Debit stock account 400 to the acct.
•Credit allocation costs •Credit side of the stock account •Post the total to the credit side of the
account •Debit side of the cost account vendor account ……………

1 2 3

Goods A/R A/P

Receipt PO Delivery Invoice

Then ……………
Stock Account •Debit the remaining 60% stock price Vendor
difference to the stock account
•Debit the 40% (of price difference for the
1 1000 400 2 1100 3
stock sold) to the price difference account
3 60

Allocation Cost Account Price Differences

Costs Account Account

3 1000 1000 1 2 400 3 40

 SAP AG 2007
 Postings in Purchasing Process for Non-Inventory Items
• The system does not trigger a posting for the goods receipt PO even if you create one

Item Category:
Inventory Item
Sales Item
Purchased Item
Fixed Assets

Purchase Goods AP
Order Receipt PO Invoice

•If the vendor is located in the same Expenses Account

country, the account from the Expenses EU Expenses Acc.
Account field is used. Foreign Expenses Acc. Vendor
•If the vendor is located in an EU country, 100 100
the account from the EU Expenses
Account field is used.
•If the vendor is located in a non-EU
foreign country, the account from the •The expenses account is retrieved
Foreign Expenses Account field is used. from the default warehouse on the
Inventory tab of the item master record.

 SAP AG 2007
 Additional Documents and Functionalities of Purchasing:
Topic Objectives

At the conclusion of this topic, you will be able to:

 Create A/P reserve Invoices, goods returns, and

credit memos
 Use the split purchase order and partial delivery
functions
 Explain the stock changes in purchasing
 Use the purchasing reports in SAP Business One
 Analyze the journal postings that have been
created in the purchasing process

 SAP AG 2007
 A/P Reserve Invoice

Purchase A/P Reserve Goods

Order Invoice Receipt PO

1.) 2.) 3.)

Reserved A/P
invoices do not
Warehouse change the In
Stock quantity.
(Quantity) The available
quantity increases
by the ordered
quantity,
•Reserve invoices
create value-
based postings

General Ledger
(Value)

 SAP AG 2007
 Goods Returns (if an A/P Invoice has not yet been created
for that Goods Receipt)

Purchase Goods
Order Receipt PO
Allocation
Stock Acc. Costs Acc.
100 100

Goods
Returns
Allocation
Stock Acc. Costs Acc.
100 100

Warehouse
(Quantity) Stock
quantities are
reduced.
 SAP Business
One corrects
General Ledger
the relevant
value-based
posting
(Value)

 SAP AG 2007
 Credit Memo for Purchasing (If you have already entered
an A/P Invoice for the transaction)

Purchase Goods AP
Order Receipt PO Invoice
Allocation
Alloc. Vendor
•The system finds the Stock Acc. Costs Acc.
100 100 100 100
same accounts that
were used to post the Credit
invoice and posts a Memo
negative value to them.
Stock Acc. Vendor
100 100

Warehouse
(Quantity) • Updates the
stock
quantities,
and
• Corrects the
General Ledger values in
(Value) accounting
 SAP AG 2007
 Split Purchase Order
• Split a single
purchase order
containing items from
several warehouses,Purchase Order Blanket 1000
into a child purchase
order created for Item Quantity Warehouse
each separate A1000 11 01
warehouse Purchase Order Blanket 1000
A1001 15 02
•Setting for splitting Logistics
purchase orders is
made via
Split PO
Administration 
System Initialization
 Document • A new field containing a
Settings on
secondary numbering
•the Per Document
segment will be added to
tab page
the purchase order number
Purchase Order 1000-1 Purchase Order 1000-2

Ship to: Berlin Ship to: Hamburg

Item Quantity Warehouse Item Quantity Warehouse
A1000 11 01 A1001 15 02

Note: You cannot split a purchase order containing items from one warehouse only.
 SAP AG 2007
 Goods Receipt PO: Partial Deliveries/Overdeliveries
Purchase Order Goods Receipt PO

# #
1 10 1 6
2 15 2
3 2 3

1.) Overdelivery Goods Receipt PO

2.) Add Items

Goods Receipt PO Goods Receipt PO

#
1 4
2
# # 3
1 1
2 20 2
3 3
4 1

Setting for splitting purchase orders is made via Administration  System Initialization 
Document Settings on the Per Document tab page
 SAP AG 2007
 Stock Changes in Purchasing A/P

Model Report: Inventory Status

Transaction In Stock - Committed + Ordered = Available

Purchase order + +
Goods receipt PO + -
Purchasing / AP

A/P invoice for

goods receipt PO
Goods Receipt PO w/o
reference to PO + +
A/P invoice
with reference + +
to Purchase Order
A/P Reserve Invoice
w/o reference to PO + +
Goods Receipt PO with
reference to A/P Reserve + -
Invoice
Goods returns - -

A/P Credit memo - -

 SAP AG 2007
 Postings in Purchasing Process for Assets
Because the asset is intended for continuous use and not for sale and
Inventory Item because you do not place it in stock, the system automatically
Sales Item deselects the Sales Item indicator and the Inventory indicator
Purchased Item
Fixed Assets

Purchase Goods AP
Order Receipt PO Invoice
Special
Asset
•If the vendor is located in the Account Vendor
control
same country, the account in the 100 100
account
Expenses Account field is used belongs to
as the asset account. the Assets
•If the vendor is located in an Account
EU country, the account in the transaction
EU Expenses Account field is type.
used as the asset account.
•If the vendor is located in a
Special Control
non-EU foreign country, the Account
account in the Foreign
100
Expenses Account field is used
as the asset account
 SAP AG 2007
 Purchasing Reports (1)

 Purchase Analysis
 Open Items List
 Vendor Liabilities Aging
 Drag & Relate

 SAP AG 2007
 Purchasing Reports (2)

Purchase Analysis:
 To analyze the purchasing volume made from your vendors, to determine
which products you purchase the most, and which of your purchasing
employees attains the best deals.
Open Items List:
 To view open sales and purchasing documents; to give you an accurate
picture regarding the status of documents in the system, only documents
with Open status appear in this report; documents that were partially copied
to target document also appear in this report.

Vendor Liabilities Aging:

 Display the detailed information for each vendor in the row. In the detailed
view, the documents are displayed together with the respective liabilities.
 The report provides the size of the vendor liability and the time that the debt
has remained unpaid.
Drag & Relate:
 To switch from the Modules menu to the Drag & Relate menu, choose the
Drag & Relate tab.
 Drag & Relate is an extensive information system that can be used to display
information about the business processes quickly and easily.
 The Drag & Relate tool uses pre-defined queries in order to generate reports
in the system, and searches both in reports and in the master data, such as
G/L Accounts and Business Partners Reports can be filtered using the Filter
function.
 SAP AG 2007
 Transaction Journal Report

Goods Receipt PO

09/10/04 Account Debit Credit

1199 10
7100 10

•Analyze all the posting documents using the transactional journal report journal
•To display the Transaction Journal Report: Financials  Financial Reports  Accounting 
Transaction Journal Report
•To display the journal entries (for example AP invoice, goods receipt PO): from the Accounting
tab page choosing the orange arrow at the Journal Remark

 SAP AG 2007
 Purchasing – A/P: Unit Summary

You are now able to:

 Model the purchasing process using SAP Business

One
 Post procurement documents
 Post returns and credit memos
 Use the reporting functions to analyze your
procurement data

 SAP AG 2007