Organizational Structure in SAP

Organizational Structure in SAP

            Organizational structure is an hierarchy of organizational units. Each organizational unit is an element of organizational structure.Organizational structure represents departments, workflow, flow of authority and responsibility etc..

Organizational Structure in SAP

Client:

          Commercially, technically, Client is also an organizational unit. Client is an highest level organizational unit in the organizational structure. Set of tables, master records are maintained at client level.

          Client is represented with three digit number. Master client (000, 001), Early watch client (066), IDES or Training client (800) are clients in standard SAP. BASIS people creates new clients.

Company code:

         Company code is a separate legal entity or separate accounting department. Accounting people work at company code level. Balance sheet, Profit & Loss statement and all financial statements maintained at company code level. Company code is represented by four digit code. It may be numeric or alphabetic or alpha numeric.

Purchase Organization:

        Purchase organization is responsible to procure materials or services from external vendor or internally from plant. Purchase organization is represented by four digit code. It may be numeric or alphabetic or alpha numeric. According to function and responsibilities purchase organizations are six types. Viz.,

1. Plant specific or Local plant purchase organization

2. Cross plant purchase organization

3. Cross company code purchase organization

4. Central purchase organization

5. Standard purchase organization

6. Reference purchase organization.

Plant:

       Plant is an organizational unit where production takes place. Plant is represented by four digit code. It may be numeric or alphabetic or alpha numeric.

Storage location:

       Storage location is an organizational unit where materials (viz.,raw materials, finished goods, semi finished goods etc) are stored.Storage location is represented by four digit code. It may be numeric or alphabetic or alpha numeric.

Organizational Structure in SAP

         

Automatic Account Determination in SAP

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Automatic Account Determination in SAP

      Automatic account determination is a process to pick suitable G/L account when goods movement has been taken place. By configuring automatic account determination settings, system will determine G/L account for posting according to goods movement type automatically.

Automatic Account Determination in SAP

Factors which influence account determination are the following:

1. Chart of accounts

2. Valuation area ( Plant or Company code)

3. Valuation class

4. Valuation modifier or Transaction key

5. General Modifier or Account modifier

Important Transaction Keys:

BSX - Stock G/L account or Inventory G/L account

WRX - GR / IR clearing account

GBB - Offsetting entry for inventory posting

KBS - Account assigned purchase order

BSV - Change in stock account

FRL - External activity

FRN - Incidental costs of external activity

KON - Consignment payable s

UMB - Gain or Loss from Revaluation

AUM - Expense or Revenue from stock transfer

AKO - Expense or Revenue from consignment material consumption

KDM - Material management exchange rate difference

PRD - Price difference account

VST - Input tax

Important account modifiers:

( Only GBB, PRD and KON transaction keys have account modifiers)

for GBB

ZOB - GR without Purchase order

ZOF - GR without production order

AUF - GR for production order with account assignment

BSA - Initial entry of stock balance

INV - Expense or Revenue from inventory differences

VBO - For consumption from stock of material provided to vendor

VBR - For internal Goods issue

VKR - For consumption for sales order without SD

VAX - GI for sales order without account assignment

VAY - GI for sales order with account assignment

VNG - For scrapping or destruction

VQP - for sampling

for PRD

"     " - (none) for GR & IR for purchase order

PRF - GR for production order

PRA - GI and other goods movements

for KON

"    " - (none) for consignment liabilities

PIP - for pipeline liabilities

Third Party Procurement in SAP MM

Third party procurement process in SAP MM

          Third party procurement process is one of the special procurement processes. In third party procurement process, customer orders goods to a company 'X'. Company 'X' gives sales order to customer for the ordered goods. Now, company 'X' gives purchase order to vendor with customer delivery address. Vendor directly delivers goods to customer. Company 'X' pays to vendor. And company 'X' collects payment from customer.  

Third Party Procurement process in SAP MM

Steps for Third party procurement process in SAP MM

1. Create material master in MM01 t-code.

        Enter required details and in sales organization 2 view, maintain item category 'BANS'

2. Create sales order in VA01 t-code.

        Enter required details and make sure that item category as 'TAS'.

      (Because of this item category 'TAS', system creates purchase requisition in background.)

3. Go to display of sales order in 'VA03' t-code.

        Enter sales order number and click enter. Sales order will be displayed. Double click on item row and           then click on procurement button under schedule line tab and observe purchase requisition number. 

             (OR)

    Go to ME53N t-code and in search help(F4), find the purchase requisition number in the sales document       tab and observe item category as third party & account assignment category as third party.

                In delivery tab customer master record is picked but not our plant address.

4. Create purchase order in ME21N t-code.

        In item row enter purchase requisition number and enter. Observe & make sure that item category and account assignment category as third party and delivery address as customer address.

5. Enter logical Goods Receipt in MIGO t-code.

        Enter purchase order number and enter. Movement type picked as 101. In partner tab, it shows that goods are delivered from vendor to customer. No storage location. Check and post.

        Observe accounting document. Transaction keys are +KBS, -WRX.

6. Enter invoice verification in MIRO t-code.

       Enter purchase order number and enter. Enter required details and post. Observe the accounting document. Transaction keys are -KBS, +WRX

7. Create billing or customer invoice in VF01 t-code (in SD side).

important Transaction Codes in SAP MM

SAP MM Transaction codes (t-codes)

SAP MM T-codes

Material Master

OMS2 - Material type customization

MMNR - Material master number range

MM01 - Material master creation

MM02 - Material master change

MM03 - Material master display

MM04 - Display changes of material master

MM06 - Flag for deletion of material master

MM11 - Material master creation - schedule

MM12 - Change schedule of Material master

MM13 - Activate schedule of Material master

MMAM - Material type change

MR21 - Material price change

MMSC - Create/ extend existing material to several stores at a time

MM60 - To see Material list

MMBE - To see Stock overview

Vendor Master

OMSG - Define Vendor account group

OMSJ - Define number ranges for vendor master

MK01 - Create vendor master ( FK01 / XK01)

MK02 - Change vendor master ( FK02 / XK02)

MK03 - Display vendor master( FK03 / XK03)

MK04 - Display changes of vendor master( FK04 / XK04)

MK05 - Block vendor master( FK05 / XK05)

MK06 - Flag for deletion of vendor master( FK06 / XK06)

Info Record

ME11 - Create info record

ME12 - Change info record

ME13 - Display info record

ME15 - Flag for deletion of info record

Source List

ME01 - Create/ maintain source list

ME03 - Display source list

ME04 - Display changes to source list

ME05 - Generate source list

Physical Inventory in SAP MM

Physical Inventory in SAP MM:

              Verification of physical existing stock and comparing with book balance (system stock) and adjusting system stock to physical stock is called as physical inventory in SAP MM.

Physical Inventory in SAP MM

               The main purpose of physical inventory is to prepare warehouse balance sheet for F.I auditing purpose.

Types of Physical inventories:

1. Manual physical inventory (continuous, periodic, manual)
2. Cycle counting
3. Inventory sampling

1.Manual Physical Inventory:

Step-1: Create physical inventory document (PID)
       Path: Logistics--------> MM-------> Physical inventory-------> PID------> Create
       T.Code: MI01
                   Enter Required details.
Note: For each storage location separate physical inventory document is require. For special stock and warehouse stock also separate physical inventory document is required.
           If we select Check box of Posting Block, all the goods movements are blocked until completion of counting process.
           If we select check box of 'freeze book inventory' , we can still allow the goods movement, but at the time of preparing this document what ever stock is there, that stock will be freezed and counted physical stock will be compared with freezed system stock.
           Enter physical inventory required material numbers and other details and save the document.
Note down physical inventory document number.

Step-2: Print physical inventory document (T.code: MI21)
            Enter physical inventory document number and click execute. Enter print output device and take printout.

Step-3: Enter counted physical stock (T.code:MI04)
           Enter physical inventory document number and click. Enter physically counted value and save.

Step-4: Post differences (T.code: MI07)
           Enter physical inventory document number and click. Enter reason for movement and save.Here physical inventory document is created and material document is posted.
           In MMBE, system stock is adjusted as physical stock.
Note: Goto material document display in MIGO or in MB03. Observe triggered movement types and accounting documents. Here stock GL account is debited or credited and Loss or gain GL account is debited or credited based on excess or shortage of physical stock with respect to system stock. Transaction keys triggered are BSX, GBB-INV.

Consignment Procurement in SAP MM

Consignment Procurement in SAP MM:

                    In consignment procurement process, vendor keeps his stock of material in plant premises and there is no invoice from vendor and no payment to vendor. When we need material we can withdraw from vendor consignment stock and for that withdrawal quantity only we have to settle the liabilities to vendor.

                    For this, first we have to activate consignment prices via info record. (Path: SPRO--> MM --> General settings for MM--> Activate consignment prices via info record.)

Steps for Consignment procurement in SAP:

Step-1: Create info record in ME11

      Enter Vendor, Material, Standard Purchase Organization, Plant and info category as Consignment. Here Tax code is must.Enter prices, validity periods in condition screen.

Step-2: Create Purchase Requisition (PR) in 'ME51N''

       Enter item category as 'K', material number, Quantity, Plant, Storage location. Here Account assignment category entry is not possible with item category 'K' combination.

Step-3: Create Purchase Order (PO) in 'ME21N'

       Enter vendor number, standard purchase organization. In item row enter PR number, then click enter.

Note: Here Net Price is graded out.Condition tab is disappeared because price will be picked from info record at the time of settlement but not from PO.

         Here invoice tab is also disappeared. So the tax code will be picked from info record.

If we observe consignment item category details, GR non-valuated is firmed and IR indicator is also firmed.It means these are selected from back ground but hided in PO.

Step-4: Enter Goods Receipt (GR) in 'MIGO'

        In MIGO, in Goods Receipt enter PO number and movement type '101'. In where tab movement type is 101-K and stock is shown as belongs to vendor.Item OK.Check and Post. 

Note: Here ' No subsequent document found in accounting'.

         In 'MMBE' our stock is not increased but vendor consignment stock is increased.This stock is not belongs to our company. It still belongs to Vendor.That's why no accounting document is created at GR.( In IMG, item category consignment GR non valuated is selected)

Step-5: Enter Goods Issue to cost center in 'MIGO'

      In MIGO, in Goods Issue, select other. Enter movement type '201-K'. Enter material, quantity, Plant, storage location.click enter. In account assignment tab, enter cost center. Item OK. Check and Post.

Note: In MMBE, vendor consignment stock decreased.

         Here accounting document is created. (transaction keys: -KON, +GBB with VBR)

         Account payable credited(-) with info record price and consumption G/L account is debited (+) with material master standard price.and differed price will be posted to price difference account.

Step-6: Settle consignment Liabilities to GI quantity in ' MRKO'

          In 'MRKO', enter company code, vendor, plant, material, consignment. Select settle. Select check boxes of withdrawals not settled and settled withdrawals. And then Execute. Click on created settlement document number. Observe amount details.

Step-7: Transfer posting form Vendor consignment stock to our own stock.

         After completion of consignment agreement, if still some quantity is left over in vendor consignment stock, then that stock to be converted into our own stock.

         In MIGO, in Transfer posting, select other and Movement type '411-K'. Click enter.

In Transfer posting tab, enter material, plant, storage location, special stock indicator as 'K' and vendor.

In quantity tab, enter quantity,. Item OK. Check and Post.

Step-8:  Settle consignment Liabilities for this owned stock in 'MRKO'

      

Important Goods Movement Types in SAP MM

Movement Types in SAP MM
                Movement type is core of inventory management in SAP. Movement type is represented by three digit numeric key (in standard SAP). If we want, we can create movement types in alpha numeric combination. Movement type indicates the type of material movement. example: Goods receipt to store, Goods issue to cost center, Goods issue against production order etc..

                Any movement type is characterized by stock update , value update or both. The movement type enables the system to find predefined posting rules, determines how the accounts of financial accounting system (stock G/L account and consumption G/L account) are to be posted and how the stock fields in the material master record are to be updated.
               When we enter a goods movement, we must always enter respective movement type. The movement type has important control functions
Movement Type controls.........
1. Updates stock and consumption G/L accounts
2. Field selection
3. Updates quantity fields
4. Putting Goods Receipts or Goods Issue slips

Important Goods Movement Types in SAP MM

101 : Goods Receipt (GR) for purchase order or order
102 : Reversal to 101 movement type
103 : Goods Receipt for purchase order into GR blocked stock (accounting document not created)
104 : Reversal to 103 movement type
105 : Release of GR blocked stock into GR stock (accounting document created here)
106 : Reversal to 106 movement type
107 : Goods Receipt for purchase order into GR blocked stock (accounting document created)
108 : Reversal to 107 movement type
109 : Release of GR blocked stock into GR stock (accounting document not created here)
121 : Subsequent adjustment for sub-contracting (this movement type can't be entered manually)
122 : Return delivery to supplier or production department
123 : Reversal to 122 movement type
124 : Return delivery to vendor from GR blocked stock ( similar to 104)
125 : Reversal to 124 movement type (similar to 103)
161 : Return for purchase order

201 : Goods Issue for cost center
231 : Goods Issue for Customer order (without shipping)
241 : Goods Issue for an Asset
251 : Goods Issue for sales (without customer order)
261 : Goods Issue for an Order
281 : Goods Issue for a network
291 : Goods Issue for an Arbitrary account assignment

301 : Transfer posting from plant to plant in one step
303 : Transfer posting from plant to plant in two step - Removal from storage
305 : Transfer posting from plant to plant in two step - placement in storage
309 : Transfer posting material to material
311 : Transfer posting from store to store in one step
313 : Transfer posting from store to store in two step - Removal from storage
315 : Transfer posting from store to store in two step - Placement in storage
321 : Transfer posting stock in quality inspection to un-restricted use stock
323 : Transfer posting storage location to storage location  - stock in quality inspection
325 : Transfer posting storage location to storage location  - blocked stock
331 : withdrawal of sample from stock in quality inspection
333 : withdrawal of sample from un-restricted use stock 
335 : withdrawal of sample from blocked stock
340 : Revaluation of batch
341 : Change in status of a batch ( available to unavailable )
343 : Transfer posting Blocked stock to un-restricted use stock
349 : Transfer posting from blocked stock to stock in quality inspection
351 : Goods Issue for stock transport order (without sampling)

411 : Transfer posting of special stocks E,K and Q to company's own stock
413 : Transfer posting to sales order stock
415 : Transfer posting to project stock
451 : returns from customer (without shipping)
501 : Goods receipt without purchase order -Unrestricted use stock
503 : Goods receipt without purchase order- stock in quality inspection
505 : Goods receipt without purchase order -blocked stock
511 : free of charge delivery from vendor
521 : Goods receipt without order -Unrestricted use stock
523 : Goods receipt without order- stock in quality inspection
525 : Goods receipt without order -blocked stock
531 : Goods Receipt for by-product from vendor
541 : Transfer posting unrestricted use stock - stock of material provided to vendor
543 : consumption from stock of material provided to vendor
545 : Goods receipt for by-product from sub-contracting
551 : scraping from unrestricted use stock
553 : scrapping from stock in quality inspection
555 : scrapping from blocked stock
561 : initial entry of stock - unrestricted use stock
563 : initial entry of stock - quality inspection stock
565 : initial entry of stock - blocked stock

601 : Goods Issue for delivery (shipping)
641 : Goods Issue for Stock transport order (shipping)
643 : Goods Issue for inter company Stock transport order (shipping)
645 : Goods Issue for inter company Stock transport order in one step (shipping)
647 : Goods Issue for Stock transport order in one step (shipping)
651 : Returns from customer (shipping)
671 : Returns to stock transport order via. shipping