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SAP FICO Business Blueprint | http://sapdocs.info

SAP FICO Business Blueprint | http://sapdocs.info


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Q: 1) Do you reduce the amount of your vendors' invoices automatically in the event of

A:Automatically - No, however, we do have occasion to reduce the invoice for non-receipt
of items or charges not allowed for in the purchase order (i.e. shipping, handling, taxes, etc).

Q: 2) Name the types of tax that might appear on a vendor's invoice.

A:No tax should appear, as the University is tax exempt.

CONFIGURATION NOTE: Tax Code I0 (Sales tax exempt) should be configured/activated
so that it can be used for all required tax fields.
Discussions should take place with Univ. of Tennessee tax controllers to ensure that no
reporting of tax exemption or possible tax self-assessment is required.

Q: 3) List the types of tax that are generally applicable and should therefore be
automatically suggested in the standard system when an invoice is entered.

A:The University is a tax-exempt entity for personal property/purchases; other taxes might
be applicable i.e. Federal excises taxes, surcharges etc.

Q: 6) How do you treat unplanned delivery costs included in an invoice?

A:On an exception basis. If other than the cost accounted for in the PO, purchasing
approves any overages, or writes a change order to include requirements not originally
ordered if previously approved by ordering department.

Q: 7) Do you sometimes have to change the account assignment for a certain purchase
order at the time of invoice verification?


CONFIGURATION NOTE: For security profile purposes, will the account assignment change
to take place at invoice verification be performed by someone in Accounts Payable (only),
Purchasing (only), the department (only), or by any of the above?

Q: 8) Should down payments also be cleared?

A:Currently, no allowance for pre payment of goods


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Q: 9) Which other messages do you want to send to your vendors or to people within your
organization with respect to the invoice receipt?

A:Not known at this time

Q: 10) Is a goods receipt always necessary for invoice verification purposes? If so, do you
allow reversal of the goods issue after the invoice has been posted?


Q: 11) Is the automatic account determination process only defined by Financial
Accounting? If not, who is responsible within Logistics?


Q: 12) Do you wish to notify Purchasing if the invoice price exceeds the purchase order


Q: 14) Do you use tax jurisdiction codes? Specify the codes used.


Q: 15) Will you have invoices with mass amounts of data for which no item check is


Q: 16) Do you receive invoices relating to transactions that are not administered in the


CI Template:


•Ability to process any type of invoice in referencing to a purchase order
•Ability to have line item check on 2 way match
•Ability to notify Purchasing if invoice price is outside tolerance
•Need ability to change account assignment in invoice verification (cost
center/object code, WBS element, etc)
•Need ability to handle retainage - two types: UT holds the money and the bank
holds the money
•Ability to process electronic invoicing (EDI) for blanket purchase orders
•Ability to set tolerance for different types of PO purchases
•Discounts should be applied to underlying expense account/cost center
•Post discounts at time of invoice posting
•System should reject invoices with unplanned freight


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•Allow for 0% tolerance amount for invoices against a purchase order - allow
Purchasing to amend the purchase order

2.General Explanations

Invoice entry will be a shared responsibility of Accounts Payable and the requesting
departments. Responsibility for each group is outlined in the Business Model section.

PROS: Workload will be distributed throughout the organization.
CONS: Security profile maintenance will increase and access restrictions to transactional
data could be compromised; End User training for Accounts Payable and Invoice
Verification will go beyond the usual system participants (i.e., Accounts Payable,
Financial Accounting) in order to include the various department personnel who will also
be responsible for invoice entry--requires additional project time and money.

3.Explanations of Functions and Events

PO is issued by the Purchasing department. The Department will receive and enter the
invoice in reference to a PO.
For items purchased w/o PO such as P-card or non-PO Purchases invoice will be
received and approved and processed by the department without purchasing
participation. See business model below for additional information.

4.Business Model

P-card purchases: Invoice receipt and entry completed by Account Payable
reconciliation accomplished by departments.
Non-PO purchases: Invoice receipt and entry completed by Department.
Purchases using Contract/ Blanket order: Invoice receipt and entry done by Account
Payable if a consolidated invoice has been negotiated and the department will reconcile
invoice. If the process does not include a consolidated invoice, the Department will
receive and enter the invoice for payment.
Purchases using release against a contract: The department will receive and process
the invoice.
Normal PO: Invoice receipt and entry done by Department
PO for services: For formal section 130 contracts, Invoice receipt at department and
entry of invoice completed by Account Payable. For other than formal contacts, invoice is
entered by the Department.

5.Special Organizational Considerations

Broad Accounts Payable (invoice verification) training initiative is necessary in order to
incorporate all key personnel at the departments and at Accounts Payable.

6.Changes to Existing Organization

N/A for purchasing. However, the role of Accounts Payable personnel could change.

7.Description of Improvements

The elimination of multiple oversight and approval of invoices. Once the material is
received the invoice is referenced to the material receipt and PO on those activities with
receipts. Multiple entry of line items in several systems or screens is not required. On


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those purchases without goods receipts the invoice will reference the PO and the line
item(s) without reentry.

8.Description of Functional Deficits

Non-referencing invoice approval strategy needs to be developed at a department level.

9.Approaches to Covering Functional Deficits

Use of Invoice Release strategies/capabilities.
Utilize Purchase Order release strategies to conform/direct invoice verification approval.

10.Notes on Further Improvements

Inventory Management is outside of this project phase; as a result, Goods Receipt is not
an essential process for this phase. Future improvements for invoice verification could
occur when Goods Receipt and Goods Receipt-based Invoice Verification are included in
the project's scope. Further, Evaluated Receipt Settlement (ERS) could be incorporated
later into the system in order to automatically process interplant material and service
transfer transactions.

11.System Configuration Considerations

System configuration considerations have been incorporated in the various individual
question and answer notes.

12.Authorization and User Roles

For procurement activities involving formal purchase orders created in R/3, the ordering
department will be responsible for processing the invoice via Logistics Invoice
Verification. For invoices generated against blanket orders established with consolidated
billing, Accounts Payable will process invoices. In instances where discrepancies arise
with regards to prices, quantities, etc, the Purchasing Department will research
discrepancies and make necessary corrections to the purchase order.

13.Project Specific CI Section


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