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Inventory Configuration
Inventory Configuration
A Step by Step Guide to the SAP MM Inventory Management and Physical Inventory Configurations
Field
Field Selection
Selection for
per MIGO ...................................................................................................................
Mvt Type ............................................................................................................. 21
21
Define Screen Layout for Movement Type ........................................................................................ 22
Settings for Transactions and Reference Documents ......................................................................... 24
Create Storage Location Automatically.............................................................................................. 26
Set Manual Account Assignment for Movement Type ...................................................................... 27
Maintain Copy Rules for Reference Documents ................................................................................ 28
Set Up Dynamic Availability Check................................................................................................... 29
Generate Physical Inventory Documents for Goods Movements....................................................... 32
Allow Negative Stocks ....................................................................................................................... 33
Set Missing Part Check ....................................................................................................................... 34
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Copyright
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Trademarks
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SAP, R/2, R/3, SAPoffice, Smart Forms, SAPscript, SAP EarlyWatch, and SAP Business Workflow are
registered trademark of SAP AG.
All other products mentioned in this documentation are registered or unregistered trademarks of their
respective companies.
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Objective
The objective of this paper is to provide the SAP MM consultant with a step-by-step guides
at configuring the SAP MM Inventory Management module. It is structure in the form of
how-to-do configurations method.
When you d o the SAP configuration, sequence is not r eally i mport ant as long as all
the MM Inventory Management modules Features that need to be used have been
configured.
Notes:
Initial IMG Action : Required (this are dynamic data which are unique to the company)
Initial IMG Actio n : Usually Not required (it depends on the customer requirement)
Initial IMG Actio n : Not required (normally this kind of configuration is quite static, most of
the customer will accept the SAP default and may request for changes after going live for a
period of time)
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Transactio n SPRO
The SAP IMG configu ration t ree for all the modu les
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As a rule of thumb, always RECOMMEND the user to set the base unit of measure for a
material to the smallest unit that can be used. That is, don't set it as FT (foot), but set it
as IN (inch). Never set EA as base unit for something that can be divided and consumed in
smaller quantities.
Please take note that y ou CANNOT change your Base Unit of Measure onc e there are
any OPEN TRANSACTIONAL POSTING done by the user. For e.g. Available Stocks,
Open Purchase Order, Open Production Order, Dependent Reservations already exists,
Open Sales Order etc.
If you try to change, a SAP message will appear asking you to click the
button. It will list all the OPEN DOCUMENTS to you.
Tip: Determi ne the low est UOM as the Base Unit of Measure
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For e.g. assuming that the Materials Master Base UOM is SH - Sheet and you need to
transact in KG. Input the X (Denominator) and Y (Numerator) for Conversion to Base Units
of Measure column and the system will automatically calculate the Number column for you
once you hit the Enter key.
Please note that you may enter only whole numbers in the numerator and denominator
fields; that is, if 3.14 m² correspond to one piece, you must enter integer multiples (314 m²
= 100 PC). In this case, the quotient is therefore 100/314 (the numerator being 100 and the
denominator 314).
Industry type are used for classifying your company industry sectors. SAP used it to
control the Field attributes o f yo ur Material Master . There are no other usage.
Note: You cannot change the industr y type after it i s being inpu t.
The only way to change the indust ry ty pe to is to Flag the materials for deletion and
archive it. Then create a new material with the correct in dustr y type.
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The Field r eference above points to the Fields in Tcode MM01/MM02/MM03 where the
user used f or m aintaining their Material Master Record.
If you intend to create a new Field ref., it has to begin with a y or z.
IMG Shortcut : Menu Path : IMG – Logistics General – Material Master – Field
OMS9 Selection - Maintain Field Selection for Data Screens
Double click on Field ref.
Double click on and you will see the Fields of each Material Master.
The attributes of Field Sel. Group have a higher p rior ity than the Field reference.
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For e.g. Field selection grp 1 contains the following fields which are all Required Entry as
you can see from the above screen.
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A storage location is the place where stock is physically kept within a plant. Some
companies will break their area to be managed by different Plant and Storage Location and
you will define IMG Storage Location Plant by Plant.
Each Plant may have different sto rage location requirement to track the mov ement
and quantities of st ocks. For e.g. defective stocks, warehouse stocks etc. For naming
convention, you can recommend them to use the building number follows by two characters
to represent the inventory type. For e.g. Building 9, the storage location for Finished Goods
can be 09FG, Defective Goods can be 09DF etc.
Storage Location is a required fields when user do entries for Goods Movement related
transaction code such as MB1A – Goods Issue, MB1B – Transfer Posting, MB1C – Other
Goods Receipts etc. User must know where they want to keep the Inventory.
You shoul d not make any IMG settings using this overall maintenance screen. Use this
screen for checking purpose as you can view all the Individual Configuration on a single
screen.
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In any of the Inventory Management goods movement transactions posting, the system
will issues messages to the user screen to inform the user about certain system
responses or data situations (for example, a message indicating that the order item is
flagged "delivery completed").
From the System Messages screen, you can see that the SAP default for all messages that
can be controlled are stored in version 00 and the Inventory Management, the application
area M7 is predefined.
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You are allow to create a new version (for example, ZZ) and this is maintained as a
parameter ID MSV in the user master record, thus representing a user or a user group.
Please note that if you did not specify any parameter ID for a given user, the system uses
version 00. If there are no entry maintain in the table for a certain version the default
message is a warning.
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For every Valuated Inventory Posting, two documents (a material document and a
accounting document) will be generated automatically by the system.
By default, SAP has already defined a range of unique number for each document type.
Companies are allowed to change them if they prefer another set of numbers.
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year. In inventory management, the transaction determines which document type is used.
To view the Financial Accounting Document Types:
Click Financial accounting document types
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In the standard SAP Inventory Management System, no change is required as the following
the document types have been predefined:
• WA for goods issues, transfer postings, other goods receipts
• WE for goods receipts with reference to purchase orders
• WF for goods receipts with reference to production orders
Click the Goods issue document type and you can view the default Doc. Type that have
been pre-defined.
You can see that each document type has been assigned a number range. In company
code 0001, number intervals are defined for each number range both for the current and
the previous fiscal year.
• Number range 49 with the year-related interval 4900000000 to 4999999999 is assigned
to the document types for all goods movements, except goods movements with
reference to purchase/production orders.
• Document type WE is used for goods receipts with reference to purchase orders and
production orders. This document type is assigned number range 50 with the year-
related interval 5000000000 to 5099999999.
Please note that the net postings of goods receipts (document type WN) are not active in
the standard system. If you want to post goods receipts net, you have to assign document
type WN (instead of WE) to the transaction MB01.
• Document type WI is used for posting inventory differences. This document type is
assigned the number range 01 with the year-related interval 0100000000 to
019999999999.
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Define Number Ass ignm ent for Material and Phys. Inv. Docs
Initial IMG Actio n : Not required
The Physical Inventory module is used to adjust your company Stock balance after the
company Physical stock-take. Physical Inventory Documents are created to captured the
stock data entries.
No action is required unless you wish to change the number assignment for the following
documents:
material documents
physical inventory documents
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The default number range 01 with the interval 0000000001 - 9999999999 has been pre-
defined for reservations.
No action is required from you unless your company preferred another range of numbers.
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The goods movement screen, MB1A, MB1B, MB1C contains many fields for data entry.
Some companies may prefer to hide those un-used fields not required for any data input.
Note that the field selection for the item screens depends on t he movement type and is
confi gured in s eparate steps.
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MIGO is the new enjoy transaction code for Inventory Goods Movement. It combines the
transaction MB1A, MB1B, MB1C and MBST
The IMG here allows you to change the attribute of those fields in MIGO.
To change to field attribute, just tick accordingly on the one of the option buttons.
Here you maintain all the settings for field selection by movement type. This step replaces
the activity Define Screen Layou t for the Enjoy transactions. The settings from Define
Screen Layout are adopted in these settings automatically so that you do not need to
maintain new entries here.
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You can specify for each field whether it is an optional entry or a mandatory entry. In the
table, you see all fields that are visible. You can access the setting Field Invisib le by
deleting the appropriate entry from the table.
There is no distinction between different special stock indicators in these entries. Special
Here you set the field selection for the movement types including goods issues and transfer
postings.
When creating a goods movement, the field selection determines which fields
• can be filled (optional entry)
• must be filled (required entry)
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This is the first scr een. Double click on the Movement Type
This is t he Second screen. Double click o n any of the Select grou p Field e.g General
data
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This is the Last screen where you change the Field Input Options
No action is required here unless you want to limit the number of selectable transactions
(goods receipt, goods issue, and so on), reference documents (material document, delivery
For example in MIGO, you can see the Selectable posting transaction and Reference
Documents type on t he top left of the screen.
Transaction : SAP Menu Path : SAP menu – Logistics - Materials Management
MIGO – Inventory Management – Goods Movements (MIGO)
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If you need only certain transactions (for example, goods receipts or goods issues), you
can choose from the following preset transactions code:
MIGO - Used to enter all goods receipts.
MIGO_GR - Used to enter goods receipts from external procurement.
MIGO_GO - Used to enter goods receipts for production orders.
MIGO_GI - Used to enter goods issues.
Configure the settin gs for tr ansactions and reference docum ents:
1. Choose the transaction with which you want to enter goods movements.
2. For each transaction, define which transactions and reference documents you want to
reference when you post goods movements.
To
left configure
screen. the Reference document, select a Tcode and click Reference document of the
Just Tick or Untick the Active column and the Reference document will appear or
disappear accordingly when the user use the transaction MIGO - Goods Receipt fo r
Purchase Order .
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The default setting for all the storage location data is created automatically for all inventory
goods movement that results in a change in the INVENTORY STOCK BALANCE.
The setting does not apply to Create Reservation transaction movement (MB21). This is
because no actual goods movement has taken place during materials reservation.
Note: if you need to create a reservation to a stor age location that have not been
created, you can use transaction MMSC to cr eate the storage location.
For each configuration, first of all you have to allow automatic creation per plant and then
you have to explicitly allow the creation of storage location data for each movement type.
Auto matic Creatio n of Stor age Location for Goods Issues and Transfer Posti ngs
Specify whether the automatic creation of storage location data is allowed for goods issues
and transfer postings. This is advisable if you work with negative stocks and a material's
first
goods movement
issue, formay be an movement
example, outward movement. Note
type 202 or 262,that theconsidered
is not reversal movement for but
as an issue a as
a receipt.
If you only use the automatic creation of storage location data for reversals of goods
issues, you do not have to allow negative stocks. The storage location data is only created
if the quantity is posted to 'standard' storage location stock. It is not created for receipts into
a special stock (for example, into sales order stock).
Location Automatically
Auto matic Creatio n of Storage Location fo r Goods Receipts
Specify whether the automatic creation of storage location data is allowed for goods
receipts. This is advisable if you want to post a goods receipt without having to maintain
the storage location view of the material master record in advance.
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The storage location data is only created if the quantity is posted to 'standard' storage
location stock. It is not created for receipts into a special stock (for example, into sales
order stock).
Auto matic Creatio n of Storage Loc ation fo r Autom atic Goods Movements
Specify whether the automatic creation of storage location data is allowed for automatic
goods movements. This is advisable for goods movements via Shipping or when you post
physical inventory differences, for example. The storage location data is only created if the
quantity is posted to 'standard' storage location stock. It is not created for receipts into a
special stock (for example, into sales order stock).
(a) Plant
In the R/3 System, account assignment is predefined via the automatic account
determination facility. When you enter material movements that are assigned to a cost
account, you can enter the account number manually. In doing so, you change the account
assignment predefined as offsetting entry for inventory posting.
Define the movement types for which you want the G/L account to be ready for input.
This happens to movement type “ 201 – Consumpti on for c ost center from warehouse” ,
where user are required to enter the cost center which is tied to a G/L a/c.
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These are the IMG transaction and Menu path where you can configure the Set Manual
Account Assignment. You can have a look but no changes are necessary.
Transaction : Menu Path : IMG – Materials Management – Inventory Management and
OMB6 Physical Inventory – Goods Issue / Transfer Postings – Set Manual
Account Assignment
Transaction : Menu Path : IMG – Materials Management – Inventory Management and
OMCH Physical Inventory – Goods Receipt – Set Manual Account Assignment
Transaction : Menu Path : IMG – Materials Management – Inventory Management and
OMJ9 Physical Inventory – Automatic Movements – Set Manual Account
Assignment
Configure whether the items of the reference document are proposed as selected on the
item selection list when entering a document with reference, or not. In the standard
system, the items are propos ed selected.
The user can delete the check marks manually on the item selection list if she/he does not
want to adopt some items. It is useful to set this indicator if usually all or most of the items
of the reference document are to be adopted.
Specify for every tr ansaction whether the it ems of t he reference document are to be
pre-selected or not b y making a Tick on Untick on the Selection Bo x.
Menu Path : IMG – Materials Management – Inventory Management and Physical
Inventory - Goods Issue / Transfer Postings – Maintain Copy Rules for Reference
Documents
Menu Path : IMG – Materials Management – Inventory Management and Physical
Inventory - Goods Receipt – Maintain Copy Rules for Reference Documents
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Dynamic availability check is link to the SAP Material Requirement Planning system. The
system checks whether the material to be withdrawn is available and issues a message, if
necessary.
In Inventory Management, two types of availability check are carried out.
availability check during the entry of reservations
availability check during the entry of goods movements
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The checking rules are also used by other applications (Sales & Distribution) and can also
be maintained by them. If you want to define new checking rules or change existing rules, it
is recommended that you contact and work with the other applications consultants for Sales
& Distribution, Material Requirements Planning.
In the Define Checking Rule button , Double click o n the Check Rule for the Individu al
Settings
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The IMG settings is straight for ward. Just tick or unti ck those stocks or documents
you want to inc lude or exclude during the MRP checking . Normally, accept the
standard default and change it as the user get famili ar with t he system.
In the Transaction code butto n, accept t he standard default checking rule assigned.
Changes are usually not necessary fo r ot her tcode.
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Define for each plant and movement type whether a physical inventory document is
automatically generated when posting a goods movement. You can create a physical
inventory document in addition to the material document at the time of a goods movement.
This function is important when inventory differences are posted from the Warehouse
Management System. These inventory differences are thereby documented in Inventory
Management with a physical inventory document.
You may only enter the transaction/event type WV (inventory difference from Warehouse
Management system).
In the R/3 System, automatic generation of physical inventory documents is allowed for
movement types 711 to 718.
1. Specify the plants for which you want the R/3 System to create a physical inventory
document. Enter transaction/event type WV for these plants.
2. Check the movement types for which you want a physical inventory document to be
created. Set the number assignment for the given transaction/event type.
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Although negative stocks are allowed by the system, most companies prefer not to used
this function as it is not a good business practice to draw stocks in advance. Most auditors
will also disapprove of this bad Inventory Movement practice. It is similar to your Bank
Overdraft facility where you are allowed to draw more than what you have in your Bank
Balance.
You can configure whether negative stocks are allowed for the unrestricted-use stock in the
valuation area, in the plant, and in the storage location.
The default IMG setting is negative sto cks are not allowed.
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Even if the "delivery completed" indicator has not been set, an item is considered closed
once the total quantity has been delivered. This means that the "delivery completed"
indicator is not necessary in this case.
Specify for each plant whether the R/3 System proposes the "delivery completed" indicator
automatically.
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Here you specify for each movement type whether, with GR-based invoice verification, a
reversal with reference to the purchase order or a return delivery can be entered, even if
the invoi ce relating t o the goods receipt d ocument has already been posted.
If reversals are not allowed, you must cancel the invoice before you enter the reversal of
the goods receipt or the return delivery.
If reversals are allowed, you can post the material document and enter cancel the invoice
at a later time. If you do not wish to cancel the invoice, you can enter the goods receipt with
reference to the reversal document or the return delivery, so that the reference to the
invoice continues to exist.
Tips : Majori ty of t he companies will not allow ed material docum ent to be cancelled
witho ut fi rst canceling th e Invoices as this can cause data inconsi stencies after a
period of ti me.
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When you enter a goods movement, you can only enter reason which have been defined
for the movement type here. Most of the time only movement type that deduct stocks need
a reason as a form of control.
Reason for Goods Movement are a required field when posting Goods Issue with MB1A
for movement type 551 – Withdrawal for scrapping. Normally, in a company, the Quality
Department will be the one that are allowed to used this movement type as they are the
one who approved whether the materials should be scrapped or not.
(a) Control Reason – Accept the default , clic k the Reason field to change the options
(b) Reason for Movement – Click New entries bu tton to enter the Reasons
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When you enter a goods movement, you must always enter the movement type. The
movement type has important control functions in Inventory Management. It is essential for:
• updating the quantity fields
• updating the stock and consumption accounts
• selection of the fields used for entering documents
• printing
• goods receipt/issue slips
Note : Never tri ed to create a new movement type wit hout c opyin g an existing one.
Additional movement type are sometimes required to differentiate the different purpose of
the Goods Movement Transaction. For e.g. Companies may create additional movement
type to differentiate between an Internal Scrap 551/552 or Customer Scrap Z51/Z52.
Al ways copy an existin g movement t ype to th e new o ne you wish to create. Don’t
forget to copy the reversal movement type and change it. To copy, just select the
movement type you want to copy and click the button.
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Double click on the Movement Type to view the detail IMG Settings
For e.g. if you Tick the Automatic PO Field, a purchase order is created automatically at
the time of goods receipt.
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For example, if you create a new movement type Z51 copy from 551, don’t forget to copy
the reversal Z52 copy from 552.
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After saving their records, users are allowed to print the goods receipt/issue slips for the
goods movements. In this IMG, you can make the following settings:
• on which printers the goods receipt/issue slips can be printed
• whether these printers support barcode and multiple printout
• for which movement types goods receipt/issue slips can be printed
• which printer is located in a specific plant/storage location and how the printout of an
output type is controlled for this printer
First find out the Print version that is use for the Inventory Transaction code
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Depending on the Print Method you used, you may need to check the Print Item settings for
this Movement Type.
Menu Path : IMG – Materials Management – Inventory Management and Physical
Inventory – Print Control –
OMB5 - Maintain Print Indicator for Goodds Recept Documents
Once you have the Print Version and Print Item Setting, proceed to MN21 to create the
condition records for which Output Type you want to used to activate the printing.
Transaction : Menu Path : IMG – Materials Management – Inventory Management and
MN21 / MN22 Physical Inventory – Output Determination – Maintain Conditions –
Create/Change Condition: Inventory Mgmt
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Leave the rest as it is, only specify the Number of messages (1 for print once, 2 for print
twice etc.)
Check the Print param. to ensure that it ties with the Print Method you used.
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For the default p rint out of the Material Document, you can specify One of the method.
Most will use Method 3 which is the easiest or Method 1 (can be a bit tricky due to the
Storage Location).
Method 1:
Transaction
OMJ3 : Menu Path
Physical : IMG ––Materials
Inventory Management––Printer
Output Determination Inventory Management
Determination – and
Printer Determination by Plant/Storage Location
Specify the Plnt, Sloc, Output Device, whether to print Immediate or Not
Method 2:
Transaction : Menu Path : IMG – Materials Management – Inventory Management and
OMJ4 Physical Inventory – Output Determination – Printer Determination –
Printer Determination by Plant/Stor. Loc./User Group
Specify the Plnt, Sloc, User gr p, Output Device, whether to print Immediate or Not
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Method 3:
Transaction : Menu Path : IMG – Materials Management – Inventory Management and
OMJR Physical Inventory – Output Determination – Printer Determination –
Printer Determination by Output Type/User
Specify the User Name, Output Device, whether to print Immediate or Not
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Although you have configure the default printer for the user, when they want to print the
Material Document Slip automatically after saving the record, they have to tick the Print
field indicator in order for the configuration to work.
The Print field indicator can be pre-selected if the parameter NDR (Print via output control
in MM - Inventory management) has been set to X (capital letter) in the user master record
(SU01).
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In this step, you define which fields are displayed in stock lists (transaction MMBE).
The R/3 System distinguishes between stock lists using version numbers. For each
version num ber, you can open up to three window s in which yo u can display
different stock li sts. For each window, you can define up to three stock types (for
example, blocked stock returns or unrestricted-use stock).
The following list versions are preset in the standard SAP R/3 System:
• 1 standard display, long
• 2 standard display, short
• 3 special display
Acti on fo r you :
Maintain the default settings as follows:
1. Under Display versio n
• Assign a version number for each version
• Define which fields are to be displayed
2. Under Rules for displ ay of stock balances, assign the following to each version
number:
• The windows you want to open
• The stock types in the columns
3. Under Detail sc reen for stock balance display, define additional stock categories.
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The Rules for Stock Balance Displ ay button decide the column in MMBE
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If a user creates a material in MM01, he must enter the Material's Valuation Class in
Acco unti ng View 1. The R/3 System uses your default settings to check whether the
valuation class is allowed for the material typ e. The valuation class is a group o f
materials with th e same account determination.
The valuation classes allowed depend on the material type. Several valuation classes are
generally allowed for one material type. A valuation class can also be allowed for several
material types.
The link between the valuation classes and the material types is set up via the account
category reference (transaction OMSK). The account category reference is a combination
of valuation classes. Precisely one account category reference is assigned to a material
type.
The Valuation Class is very imp ortant b ecause it define the General L edger Ac count
code that will be posted in Financial Accounting . This will impact the Profit and
Loss Account.
Valuation Class cannot be change once transaction pos ting begins fo r th e Material.
If you want to change it, all Open Sales Order, Purchase Orders, Produc tion Orders
etc. have to be close.
Transaction : Menu Path : IMG – Materials Management – Valuation and Account
OMSK Assignment – Account Determination - Account Determination Without
Wizard – Define Valuation Classes
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Valuation class
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For this IMG settings, you will configure the link between Inventory Management and
Financial Accounting.
During inventory goods movement, the user does not have to enter a G/L account, since
the R/3 System automatically finds the accounts to which postings are to be made using
the following data:
Without Valuation Grouping, you will need to maintain each entry for every valuation area
you have.
Valuation Group Valuation Class G/L Account
0001 01 12345
0001 01 65432
0002 02 67890
0002 02 56565
Grouping all t he Valuation area as one is t he recommended configur ation method.
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To use the Valuation grouping, first set Valuation grouping code to active in “OMWM”.
You can now do the grouping in “OMWD”. For example, you group all the Valuation area to
the same valuation group.
Val. Area CoCode Company name Chrt/accts Val.grpg.code
AA 0001 ABC Engineering Ltd XYZ 0001
BB 0001 ABC Engineering Ltd XYZ 0001
CC 0001 ABC Engineering Ltd XYZ 0001
inventory posting.
entries record Theinto
to post movement type will enable the system to determine the correct
the system.
Account g roupin g (only for offsetting entries, consignment liabilities, and price
differences)
The posting transaction " Offsetting entry for inventory posting" is used for many
different transactions posting (for example, goods issue, scrapping, physical inventory),
which are assigned to different G/L accounts (for example, consumption account,
scrapping, expense/income from inventory differences). Therefore it is necessary to divide
the posting transaction according to a further key: account grouping code. An account
grouping is tied to each movement type in inventory management which make use of the
posting transaction " Offsetting entry for inventory posting" . In the posting transaction
" Offsetting entry for inventory posting" , you must assign a G/L accounts for every
account grouping. If you wish to post price differences to a different price difference
accounts in the case of goods receipts for purchase orders, goods receipts for orders, or
other movements, you can define different account grouping codes for the transaction key.
With the account grouping, you can also have different accounts for consignment liabilities
and pipeline liabilities.
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Valuation c lass of material or (in case of spli t valuation) the valuation type
The valuation class allows you to define automatic account determination that is dependent
on the material. The user will define the valuation in the Material Master (MM02 –
Accounting 1 View ) decided by Finance which will tied each Valuation class to a G/L
Account code. For example: you can post a goods receipt of a raw material to a different
stock account
the same than if the
transaction goods
for both receipt were
materials. You for
cantrading goods,
achieve this even though
by assign ingthe user enters
di fferent
valuation classes to the materials and by assigni ng diff erent G/L accounts t o the
posting transaction for every valuation class. If you do not want to differentiate
according to valuation classes you do not have to maintain a valuation class for a
transaction.
The G/L account assignments for the charts of accounts INT and the valuation grouping
code 0001 are SAP standard.
(a) At the Initial scr een, click th e Account As signm ent button t o view this s creen.
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chart/acct.
Notice the first column Valuation modif., if you did not group the Valuation Area, then
you’ll have to define each Valuation Area for each Valuation class for each G/L Account. If
you have four Valuation Area, then everything will be multiply by four.
At the above screen, click the Rules button and you are allowed the followings options on
how your G/L Accounts are determined. Most common options will be to tick the
followings:
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You can find the relevant Accoun t Modificatio n for each of the movement types.
IMG Shortcut Menu Path :
OMWN IMG – Materials Management – General Settings for Materials
Management – Valuation and Account Assignment – Account
Determination – Account Determination without wizard – Define Account
Grouping for Movement Types
For example, Vendor Consignment movement type is 411 and special stock K. You can
see that the Account modification is VBR.
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For you to be able to configure the Valuation Class and G/L Account, you’ll have to wor k
with the Finance Department or FI Consultant as they need to provide you with all the
G/L Account for the Material Valuation Class.
The follo wings are the Inventory Transaction that you need to confi gure:
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Click the Account assi gnments button and from the system message, you will be able to
tell if there are errors in your Account assignments.
You can also check which G/L Accounts is tied to which Valuation Class by clicking the
button in transaction “OMWB”.
The report will list all the Valuation Class under the G/L account.
It is not necessary to have stock count for all the storage location. At time, certain storage
location might not be subject to stock-take and you can untick the field Freeze book
inventory.
Menu Path : IMG – Materials Management – Inventory Management and Physical Inventory
– Physical Inventory - Allow Freezing of Block Inventory Balance in Storage Location
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The advantage for this arrangement is that the vendor remains the legal owner of the
materials until you withdraw the materials from the consignment stores. Payment to the
vendor is then activated. There are less downtime as materials are always available at
your company premises.
To use the SAP Vendor cons ignment, you have to do t he follow ings IMG:
Step 1: Act ivate Consign ment Prices via Info Records
IMG Shortcut Menu Path :
OMEV IMG – Materials Management – General Settings for Materials
Management – Activate Consignment Prices via Info Records - Activate
Consignment Prices via Info Records
Step 2: Config ure the Consig nment Autom atic Posting Acc ount Code
IMG Shortcut Menu Path :
OBYC IMG – Materials Management – General Settings for Materials
Management – Valuation and Account Assignment – Account
Determination – Account Determination without wizard – Configure
Automatic Postings
Description Transaction
Offsetting entry for inventory posting GBB
Consignment payables KON
Cost (price) differences PRD
You must define the Account Assignment for Consignment payables – KON
GBB and PRD can be optional as the G/L account code can be the same.
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1. First a contract will be drawn and sign between your company and the vendor. The
vendor will provide you with the materials price which the Purchaser will input to tcode
ME11 – Creating Info Records f or Consignment Stocks.
2. For any materials that you need from the vendor, the Purchaser will create a Purchase
Order with tcode ME21N – Create Purchase Order f or Consig nment. The system will
identify the Consignment PO by the Item category K which the Purchase enter in the
PO. In a consignment PO, no material price is required to be entered.
3. Once the Vendor delivered the materials to your company premises, the Store
personnel will entered a Goods Receipts with reference to the PO with tcode MIGO –
Goods Receipt for Purchase Order .
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4. You can view the consignments for each materials with tcode MMBE – Stock
Overview. A line item with the field named Vendor consignment will appear. Double
click on the Quantity and you will be able to view the Vendor who supply the materials.
Any stocks that remain in the line item Vendor consignment belongs to the Vendor and
no payments is required. To view all the Open Consignment stocks, use tcode “MB54”.
5. To used
stocks the consignment
which stocks, the
is the field Unrestric tedPurchaser have to
used column. Thetransferred
Purchaserit will
to your
usedcompany
tcode
MB1B – Enter Transfer Posting with Movement type is 411, Special Stock ‘K’ and the
Vendor c ode that the materials you want to used (assuming that you have multiple
Vendor that supply the same materials). At this point, the system will read the PRICE
from the Vendo r Materials Info Record (ME12) and create a Financial documents.
After the transfer, the stocks belongs to your company and payment will be made
according to the agreement.
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6. At the payment intervals agreed, Finance department will print the Consignment
Settlement list with tcode “MRKO” . The list will be passed to the Purchase Department
for verification. Once verified, Finance will do a Consignment Settlement with tcode
“MRKO” and the Vendor will be paid.
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During the Initial MM Implementation, ensure that the start of the MM Period for the
company code is maintain in OMSY. This IMG will allows the user to start inputting the
Material Master Records which later allows them to input the Inventory Records.
Transaction : Menu Path : IMG – Logistics General – Material Master – Basis Settings
OMSY – Maintain Company Codes for Material Management
Subsequently, every end of the month, you will close the current month Inventory and Open
the Next Inventory Period with transaction MMPV. The Period is always the Next Period.
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SAP have assigned movement type 561 as the initial Inventory value entry. For wrong
entry, enter
reverse. the the
After same information
Initial with
Inventory movement type
transferred, 562 and
no one shoulthe Inventory
d be figures
author ized will be
to used
561/562 anymore.
On the second screen the user just need to enter the Material and Quantity. To enter more
materials click on the Menu Edit – New it ems
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Static data includes items that are relatively stable such as vendor master, material master,
BOM, routing, work centers, customer master, price agreement, material group, activity
prices, cost centers etc.
Dynamic data includes items such as inventory balances, A/R balances, A/P balances, GL
balances, Open Production Orders, Open Sales Orders, Open Purchase Orders and
Planned Independent Requirements.
In general, we will have lots of time to convert the static data but insufficient time to rush
the dynamic data into the system. This is because dynamic data must be converted with a
clear cut-off date. This means th at the balances must be that of the same point in
time in or der to ensure the integrity of data.
Where the volume of data in relation to the number of end users is high, we will consider
automating the conversion, provided that data is available from the old system.
If the volume is low or if data is not available from the present system, users should key the
data directly into SAP. This approach has an added and import ant benefit of tr aining
the end users in the operation of the SAP system.
If done correctly, the balance in the Inventory Conversion Control Account should become
zero.
Both the existing system extraction program and the SAP batch input record formatting
program must be ready by Month 99 for the trail run.
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Ap pen di x A : Th e Invent or y Good s Movem ent Confi gu rati on Li nks Expl ain
Now, let see what are the Inventory Goods Movement Configurations that are related
before the user can post any Goods Movement:-
1. Configure the Valuation Class (OMSK) which the user will then maintain it in transaction
MM01/MM02 – Accounting 1 View. The Valuation Class will allows the system to
post to the correct General Ledger Account in the Financial Accounting Modules.
2. Maintain the Storage Location by Plant (OX09) which the user will then have to specify
when they do any Inventory Posting with the Goods Movement transaction like MB1A,
MB1B, MB1C, MB01, MB31, MIGO. If you have accept the default configuration
Create Storage Location Automatically (OMB2, OMB3, OMJ8), then user does not need
to create the Storage Location (MMSC) for the material manually every time they post a
new Storage Location for the material.
3. Set the Printer Determination (OMJ3 or OMJ4 or OMJR) if the user wish to print the
Material Document after Goods Movement have been successfully posted.
4. Maintain the Reason for Movement (OMBS) for the Material Scraps Movement type
551.
5. Optionally, you may want to Hide Unnecessary Fields by Movement Type (OMJX,
OMBW, OMCJ, OM9A) that your company does not need.
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Ap pen di x B : Restr ic t t he Stor age Loc ati on fr om any Goo ds Movement
If you want to restrict the users from performing any Goods Movement, first Flag for
Deletion the Material Storage Location and then set the Message M7 127 to ‘E’.
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This SAP Message will pop-up when t he users try to do a Goods Movement :-
Material Testing Plant SLOC flagged for deletion
Message no. M7 127
Depending on the system setting, the system issues either a warning or an error message.
• If the message is a warning ( W), the system will accept your entry, but
simultaneously issues a warning to prevent you from making the wrong entry.
• If the message is an error message ( E), the system will not accept your entry.
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Ap pen di x C: Al lo ws /Disall owed Good s Movem ent Posti ng to Previo us Period
This transaction code allows you to control the Inventory Posting for the Current and
Previous Period (SAP terms for month) after the Month-end Closing.
The purpose of setting this indicator is to stop the user from posting any Inventory
transaction after the beginning of a new Month. This is usually a request from Finance
department because they will not be able to determined the Previous Month stocks figures
if user to continue to post entry to the previous month as Financial Document will be
created for any valuated materials that the user post to the previous month.
To prevent user from posting to the Previous Month, untick Allow posting to
previous per. and tick Disallow backposti ng generally as shown below and vice
versa.
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Archiving is normally done by the Basis team, but you may required to do it, if you does not
have one (For e.g. SAP server is outsource to a Data Center). Upon successful deletion,
the Basis person or the Data Center will backup the archive files into a TAPE before
removing it from the SAP server.
Type the Material Documents Object name is “MM_MATBEL” and Hit Enter.
Figure 1:
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Figure 2: If you are doing it for the first time, click the Customizing button.
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Figure 4: Customize the Test Variant to Test and the Production Variant to Production:
TestSessVariant – Click Variant -> Values -> Tick Simulation and Log
Prod. Session Variant – Click Variant -> Values -> Tick Log
Save it and return to the Archiving Main Menu (Figure 2).
Figure 5: With the above settings, you can now proceed to do the Archiving. At the Main
Menu (Figure 2), Click the Archiv e button. Type in a Variant Name and click the Maintain
button.
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Figure 6: Depending on your company Financial Year Configuration, your document year
might not follows the normal Calendar year. For e.g. 200401 refers to July 2003 and
200412 refers to June 2004. Save your Variant.
To start the Archive, Click the Start button in Figure 5, then follows by the
Save button.
The Start date will change to Green Light and you can now click the Execute button.
Check the Spool Request and reconfirmed that the Archive Material Documents are those
that you wish to delete.
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If everything is ok, you can proceed to Figure 2 and click the Delete button to start the
Actual Delete from the SAP database. Click the Archiv e selectio n to select the Archive
files.
Tick the Archiv e files and hit the Enter key. Next maintain the Start date button as
Immediate. You can tick the Test session button to do a test first before starting the
Actual Delete. Once you are comfortable, Untick the Test session button and do an
Actual run and the Material Documents will be Physically deleted from the database.
When
random the Deletion
check with Jobs is completed,
transaction MB03 toyou canthat
verify check the Archive
those spool log in tcode SP01 and
documents does not do a
exists anymore.
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The cycle counting indicators are used to group the materials together into individual
categories.
Normally, the cycle counting indicators are assigned when an ABC analysis is run.
However, different indicators can be defined, if necessary.
Remember that the total of the percentages must be 100 if you want to assign the indicator
to the individual materials as part of an ABC analysis.
For Example,
In a given plant, 200 materials are subject to the cycle counting physical inventory
procedure.
In Customizing for Inventory Management, the following percentage allocation has been
defined for the plant:
A materials: 50%
B materials: 25%
C materials: 15%
D materials: 10%
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In the cycle counting analysis, the materials are sorted by consumption. After completion of
the analysis, the cycle counting indicator is assigned as follows:
The first 3 materials (sorted in descending order according to consumption) represent 50%
of the consumption and have the indicator A.
The
The next
next 12
49 materials
materials represent
represent 25%
15% of
of the
the consumption
consumption and
and have
have the
the indicator
indicator B.
C.
The remaining 136 materials represent the rest (10%) of the consumption and have the
indicator D.
Note:-
If you tick the All sto ck materials, all material includi ng thos e who do not have the
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Field explanation:
Field Descrip tion Mandatory
Plant Plant code for which the cycle count indicator No, but at least one
is to be put. selection option to be
given.
Material
Type To enter
count the material
indicator type
is to be put.for which cycle No, but atoption
selection least one
to be
given.
Materials Tick this box if even the material with deletion No. Why include Material
with flag are also to be included. that is already flag for
deletion flag deletion?
Al l sto ck If this check box is ticked, all material including No, but recommend.
materials those who do not have cyclic count indicator
are also taken.
Key figure Select radio button “consumption usage” if Yes
radio button past consumption should decide indicator or
select “requirements”
indicator. if forecast
Also put from to decide
and to date the
for option
chosen default is 3 months past and 3 months
future respectively.
Change cc Put tick if you want to do changes for the No
percentages default percentages set for A, B, C, D
check box
Processing Use radio button “Display list first” or “update Yes
radio button without list”. The names show what is the
function
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Background
Press the Process button
Click on the Enter key to refresh the screen
To view the completed job, press the Log icon (or F7). Check the logs for any
errors.
Double click on the screen to see the physical inventory document numbers
The transaction t o carry out and enter the Physical count into SAP
Document – PhysicalDoc.
Inventory Inventory – Physical
– Change (Put year
as fiscal year and not Calendar
year.
MI03 Display Inventory Document Logistics – Materials Management
– Physical Inventory – Physical
Inventory doc. – Display (To print
physical inv doc. – Print)
MI11 Recount Logistics – Materials Management
– Physical Inventory – Physical
Inventory doc – Recount
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