2011-1-Training Manual On Material Management

HPPCL-MM-TRG-V2
Training Manual Materials Management
Agenda
Section
Topics
1.
Material Management Overview
2.
Organizational Elements
3.
Master Data
4.
Procurement Cycle
Inventory Management
Invoice Verification
Valuation
Price Control
Managing Supplier Relationship
10
Material Requirement Planning
Page 2
Page No.
Agenda Day 1
Section
Topics
1.
2.
3.
Master Data
4.
Procurement Cycle
Valuation
Price Control
10
Page 3
Page No.
Materials Management Overview
Materials Management
External procurement of materials and services ,

Determination of sources of supply for a requirement
Monitoring of deliveries
Invoice Verification of Invoices submitted by vendors
Inventory Management function
Page 4
What is Materials Management ?
Procurement
Procurement
Requisition Planning
Purchase Requisitions
RFQs
Contracts
Purchase Orders
MM
MM
Master
Master
Data
Data
Materials
Vendors
Information
Records
Inventory
Inventory
Management
Management
Receiving
Disbursement
Physical Inventory (Raw Material,
Semi Finished Goods, Finished
Goods)
The Material Management module comprises of procurement and the inventory management
functions .
Page 5
The processes of Material Management are based on various types of

Master Data which are stored in Master Records.
MASTER
DATA
Vendor
Materials
Master Records
Page 6
Purchasing
Info Records
This diagram illustrates a typical SAP-supported procurement cycle.
Page 7
Agenda

Master Data
Procurement Cycle
Valuation
Price Control
Page 8
Organizational Elements in MM
Organizational Levels in the Procurement Process
Client
In the SAP R/3 System,

organizational levels are
structures that represent
the legal or organizational
views of a company.
n A client is the highest
organizational level,
representing, for
example, a corporate
group.
Company Code
Plant
Storage Location
Purchasing Organization/
Purchasing Group
SAP AG 1999
n Balance sheets and Profit and Loss statements, required by law, are created at company code level.
n You can set up several company codes in one client in order to manage various separate legal entities
simultaneously, each with their own balance sheet of financial books.
Page 9
Materials Management Organizational Elements
Group
Company
Client
Subsidiary
Purchasing
Organization
Purchasing
Org.
Plant
Storage
location
Plant
Storage
location
Company Code
Storage
location
Plant
Storage
location
Storage Location
Purchasing Group
Purchasing
Group
Page 10
Plant
Plant is an organizational unit that structures the enterprise from the

perspective of production, procurement, plant maintenance, and
materials planning.
Plant can be for example
Regional sales office
Manufacturing facility
Corporate headquarters
Central distribution center
Maintenance plant
Plant is assigned to a company.
Material is usually valuated at plant level.
A physical location within a company, where materials are stored,

manufactured, purchased or sold.
Page 11
Storage Location
Storage location is an
organizational unit that allows
differentiation of material stocks
within a plant.
Physical inventory is carried out at

storage location level in the plant.
A subdivision of a plant
representing locations where
materials are physically stored.
Page 12
Purchasing Organization and Group
Purchasing organization subdivides an enterprise according to the requirements

of Purchasing.
Purchasing organization procures materials and services, negotiates conditions

of purchase with vendors, and bears legal responsibility for such transactions.
Purchasing group is the key for a buyer or group of buyers responsible for
certain purchasing activities.
Usually the principal channel for a company's dealings with its vendors
Page 13
Organisational Elements in MM Purchasing:
Purchasing Organization:
An organizational unit responsible for procuring
materials or services for one or more plants and
for negotiating general conditions of purchase
with vendors. The purchasing organization
assumes legal responsibility for all external
purchase transactions.
Page 14
Centralized Vs Decentralized Purchasing
You can organize your purchasing function in the following ways:

Centralized purchasing, with just one purchasing organization
Distributed purchasing, with a number of different purchasing organizations
each responsible for different plants
Page 15
Purchasing Group
The purchasing organization is further subdivided into purchasing

groups (buyer groups), which are responsible for day-to-day buying
activities.
A purchasing group can also act for several purchasing organizations. It
is internally responsible for the purchase of a material or a class of
materials.
SAP Characteristics
Key for a buyer of group of buyers responsible for certain
purchasing activities Usage
Purchasing groups can represent the buying responsibility groups
such as:
Raw Materials, Packing Materials, Capital Goods, A&SP
procurement, Services - Admin, Finished Goods, Indirect
Material- Plant, Indirect Material- HO
Advantages
Reporting can be consolidated at Purchasing group level.
Purchase document release procedures based on value limits can
be implemented.
Page 16
Agenda

Master Data
Procurement Cycle
Valuation
Price Control
Page 17
Material Management : Master Data
Objectives
Understand the concept of Master Data as it relates to the Materials Management module in
SAP
Be able to identify the different types of Master Data used in Materials Management
Create and display Master Data in an SAP system
Page 18
Contents
1.
2.
3.
4.
5.
6.
7.
8.
Material Master
Vendor Master
Service masters
Purchasing Info Records
Source Lists
Price Conditions
Vendor Evaluation
Bills of Materials (BOMs)
Page 19
Master Data
Master Data is a shared source of information that all departments can access and
utilize to perform their jobs.
Master
Data
Materials
Management
Finance/
Controlling
Page 20
Master Data
The processes of Material Management are based on various types of Master

Data which are stored in Master Records.
MASTER
DATA
Vendor
Materials
Master Records
Page 21
Purchasing
Info Records
Material Master Data
Basic Data 1
Basic Data 2
Classification
Sales: Sales Org. Data 1
Sales: Sales Org. Data 2
Sales: General/Plant Data
Foreign Trade: Export Data
Sales Text
Purchasing
Foreign Trade: Import Data
Purchase Order Text
MRP 1
MRP 2
MRP 3
MRP 4
Forecasting
General Plant Data / Storage 1
General Plant Data / Storage 2
Warehouse Management 1
Warehouse Management 2
Quality Management
Accounting 1
Accounting 2
Costing 1
Costing 2
Material
Master
Page 22
Material Type
Material Group
Material master in SAP.
The material master contains information on all the materials that a

company procures, produces, stores, and sells.
The material master is used by all components in the SAP Logistics
System
Different departments in a company work with the same material,
so data in a material master record is subdivided in the form of user
departments.
Material description and Base unit of measure appear in all user
departments.
Page 23
Use of material master in

SAP logistics system functions.
In Purchasing for ordering materials.

In Inventory Management for goods movement postings and physical
inventory
In Logistics Invoice Verification for posting invoices
In FI for maintaining value of material.
Page 24
Material Numbers
Definition
Number uniquely identifying a material master record, and thus a
material.
Use
For every material that your company uses, you must create a material
master record in the material master. This record is uniquely identified
by a material number.
Internal and External number assignment.
Page 25
Material Master Key points
The Material Master is used by several areas of the system in addition to

Inventory. Some of these are Purchasing, Manufacturing, and Despatch.
Material masters must be created for all stocked materials, and can
optionally be created for some non-stocked items (eg. Services).
Raw Materials, Stocked Intermediates, Spare Parts and Maintenance
Spares will definitely be in the SAP material master database.
Services and other non-inventoried items could be part of the SAP material
master database. These will be confirmed as part of the BBP phase of the
project.
Page 26
Material Master Views
SALES
Basic data1
BASIC DATA *
Product hierarchy
Shipping details
Description
Unit of measure
STORAGE
Picking area
Storage bin (fixed)
Purchasing
Purchase order text
PURCHASING
Storage 1
Purchasing group
Delivery tolerance
WORK SCHEDULING
Production controller
Prodn. Tolerances
Storage 2
Accounting 1
Accounting 2
MRP
ACCOUNTING
MRP Type, or MPS

MRP Controller
Lot size key
Valuation class
Price control
Company Level *
Page 27
Plant Level
User departments using same material master
Page 28
Industry Sector
It determines type of industry .

Eg. mechanical industry,chemical industry,pharmaceutical etc.
The industry sector you specify determines
Which screens appear and in what sequence
Which industry-specific fields appear on the individual screens
Code
Industry sector
Chemicals
Mechanicals
Pharmaceuticals
Plant Engineering & Construction
Retail
Page 29
Material Types
Materials with the same basic attributes are grouped together and assigned
to a material type.
When creating a material master record, you must assign the material to a
material type. The material type determines certain attributes of the material
and has important control functions.
Material
Type
Description
Example
FERT
Finished Products
Power
PIPE
Pipeline Materials
Gas, Oil, Electricity, Water, Utility supplies
ROH
Raw material
HALB
Semi finished
DIEN
Services
Legal, Consulting, Construction services
ERSA
Spare Parts
Nuts, gears, motors

Page 30
Vendor Master Data
General Data
Address
Control
Payment transactions
Company Code Data
Accounting info
Payment transactions
Correspondence
Withholding tax
Vendor
Master
Purchasing Organisation
Data
Purchasing data
Partner functions
Page 31
Company
Code
Purchasing
Organisation
Concept of vendor master in SAP
vendor master record is maintained by both Accounting and Purchasing.

A vendor can be a one time vendor or regular vendor
A vendor master record contains the vendors name and address, as well
as data such as:
the currency used for ordering from the vendor
terms of payment
names of important contact persons (sales staff)
Page 32
Vendor master
A Vendor Master Record stores information pertinent to a companys vendors.

It contains 3 different types of Data which are used to support both Materials
Management and Finance activities in SAP.
Vendor
Master
Record
Account Number
Description
Address
for company
code
for purchasing
organization
for all clients
Account
Data
Purchase
Data
General
Data
Order Currency
Incoterms (terms of
shipping)
Page 33
Control account
Terms of payment
Bank Details
Maintaining Partners
The business partner "vendor" can assume different roles in its dealings
with another enterprise. Accordingly, in a procurement transaction, the
vendor is first the order recipient, then the supplier of goods, then the
invoicing party, and finally the payee. One or more of these roles may
involve different vendor master records.
The following partner roles are defined in the standard system:
Vendor
Order recipient
Goods supplier
Invoicing party
Payee
Page 34
Service Master Record
Contains the description of a service

Serves as a source of data when creating service specifications
Contains the following:
Service number and service category
Descriptive texts
Base unit of measure
Material group
Valuation class
Page 35
Info Records
Material
Master
Vendors current
price
Vendor
Master
Info
Record
To allow the assignment of product requirements to sources of supply, specific
product and supplier information is combined and stored as one Purchasing
Info Record.
Page 36
Concept of Purchasing info Record
An info record represents a material-vendor relationship.

The info record contains concise information about a vendor and a material
that you already procure from that vendor.
Info records are created automatically when you order a material. You can
also create, change, and delete info records.
Use of Purchasing info record in PO creation
Net price for the item will be defaulted in PO
All the pricing conditions will be defaulted
Page 37
Info Records- Key points
Purchasing Info Records contain information on a specific material and

vendor supplying the material including:
Prices and conditions for the relevant purchasing organization or plant
Tolerance limits for over deliveries and under deliveries.
The info record allows buyers to quickly determine:
Which materials have been previously offered or supplied by a specific
vendor.
Which vendors have offered or supplied a specific material.
Used as default data in documents
Can be valid for all plants or a single plant
Can be created manually or automatically
Ordering data updated automatically in the info record
Page 38
Concept of source list in SAP
A source list specifies the possible sources of supply for a material over a
given period of time
It shows the time period in which a material may be ordered from a given
vendor
Source list can be created automatically using generate source list option
Source list can also be maintained manually.
Uses of source list
Fixed vendor
Vendor blocking
Auto PO creation
Page 39
Condition Technique
The most important elements in price

determination are the following:
Condition Type: Condition types represent price
factors in the system.
Condition Table: A condition table consists of one
or more condition keys and a data part.
Access Sequence: An access sequence is a
search strategy by means of which the system
searches for valid records in various condition
tables.
Calculation Schema : A calculation schema
groups together all condition types that play a part
in calculating the price.
Page 40
Agenda:Day 2
Section
Topics
1.
2.
3.
Master Data
4.
Procurement Cycle
Valuation
Price Control
10
Page 41
Page No.
Procurement
Objectives
Understand the concept of Procurement as it relates to the Materials
Management module in SAP
Be able to identify the key SAP procurement documents used in the
Materials Management module
Execute key procurement transactions in the Materials Management
Module
Page 42
Contents
1.
2.
3.
4.
5.
6.
7.
8.
Procurement Cycle
RFQ/Quotation
Purchase Order
Release Strategy
Procurement of Consumable Material
Account Assignment
Special Procurement Processes
Consignment
Sub-contracting
Page 43
Procurement Cycle
Determine requirements and
potential sources; negotiate with
suppliers to set up agreements;
create supply plans
Convert requisitions to
Purchase Orders or
create replenishment
orders
Logistics Invoice
Verification and
payment
Goods delivered
Invoice receipt
Page 44
Purchasing - overview
The Purchasing component has the following tasks:

external procurement of materials and services
determination of possible sources of supply for a requirement identified
by the materials planning and control system
determination of possible sources of supply for a requirement arising
directly within a user department
monitoring of deliveries and payments to vendors
Page 45
Integrated Business Process Overview
FI
G/L
G/LInventory
Inventory
//GRIR
GRIR
G/L
G/LGRIR/
GRIR/
Expense
ExpenseAP
AP
Invoice
Invoice
Goods
Goods
Receipt
Receipt
Invoice
Invoice
Verification
Verification
MM
Requirement
Requirement
for
forGoods
Goods//
Services
Services
Purchase
Purchase
Order
Order
Financial
Financialand
andManagerial
ManagerialReporting
Reportingand
andAnalysis
Analysis
Page 46
Vendor
Vendor
Payment
Payment
Project Materials Planning
Erection
Procurement
WBS
WBS
Requirements
From Project or Project Stock Indicator
Commissioning
2
MM
MM
Purchasing
PS
PS
DMS
DMS
1
Materials Planning
Purchase Requisition
Design Document
Purchasing Order
Goods Issue
Goods Receipt
Page 47
Cables
PO-1
Generator
PO-2
Purchasing Documents
= Enquiries
Suppliers
Quotations
Request for Quotations

Blanket POs
Scheduling Agreements
Purchase Orders
Material Reservations
Contracts
Page 48
Info Records
A purchasing document is an instrument used by Purchasing to procure

materials or services.
Types of purchasing documents
Purchase Requisition
Request for Material Procurement from user departments Or
System generated as Output of MRP run
Request for quotation (RFQ)
Transmits a requirement defined in a requisition for a material or
service to potential vendors .
Quotation
Contains a vendor's prices and conditions
It is the basis for vendor selection.
Page 49
Purchase order (PO)

The buying entitys request or instruction to a vendor (external supplier)
to supply certain materials or render/perform certain services/works,
It formalizes a purchase transaction .
Contract
In the SAP Purchasing component, a type of "outline agreement", or
longer-term buying arrangement .
The contract is a binding commitment to procure a certain material or
service from a vendor over a certain period of time.
Scheduling agreement
Another type of "outline agreement", or longer-term buying
arrangement. Scheduling agreements provide for the creation of
delivery schedules specifying purchase quantities, delivery dates, and
possibly also precise times of delivery over a predefined period .
Page 50
Release Strategy
A release strategy defines the

approval levels through which a
purchase document should be
released
The release code determines who is
authorized to release the document
Page 51
Release Procedures
Procurement Cycle Overview and Terminology
Release procedures:
Allow a company to maintain control over what is purchased.
Can be defined for requisitions, purchase orders, contracts, and request for
quotations.
Employ a release strategy that defines what qualifications the purchasing
document must have in order to be assigned the release strategy.
Release strategies are based upon attributes of the purchasing documents
that the company desires to implement control over such as value.
Once a release strategy is assigned, it must be released by someone with
the authorization to use the specified release code. (Segregation of Duties)
Page 52
52
Release Strategy - Example
Releases Strategies Defined
Conditions
PO Value < 10000, approval by Team Lead
Strategy
Release Codes
S1
Team Lead 1
S2
Team Lead 2
PO Value > 10000, approval by Team Lead
Project Manager
Release Strategy Applicable
Purchase Order
Value = 4050
Page 53
The Types of procurement Cycles
Procurement of External Services

Standard Procurement Cycle
Subcontracting Procurement Cycle
Consignment Cycle
Pipeline Procurement Cycle
Stock transfer Cycle
Project Purchase Cycle
Page 54
Agenda: Day 3
Section
Topics
1.
2.
3.
Master Data
4.
Procurement Cycle
Valuation
Price Control
10
Page 55
Page No.
External Service Management
1. Service Procurement Cycle

2. Service Master Record
3. Service Purchase Order
4. Service Entry Sheet
5. Release Procedure
6. Invoice Verification
Page 56
Services : Procurement Cycle
Steps in the Procurement of Services

Determination
of requirements
Karl Einstein
Bank transfer
Date
$9,500
RFQ
Creation of
service
specifications
Payment
PO
- User department
- PM Plant maintenance
- PS Project system
Invoice
Bid
invitation
Invoice
verification
?
=
Service
acceptance
Quotation
entry
Service
entry
PO monitoring/
follow-up
Source
determination
Ordering
process
SAP AG
Page 57
Vendor
selection

Service no. 1540

- Texts
- Units of measure
PM
Plant
Maintenance
Plant
maintenance
order
PS
Project
System
Service conditions
200
Service master record
MM
Procurement
Purchase
order
Network
PReq.
Specs
Applications
SAP AG 1999
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.
Page 58
Purchase Order for Service

Stock Material <=> Services
Purchase order # 12345 Jan. 27
Purchase order # 12345 Jan. 27
Item 10
Item 10
Material
: Steel - 01
Order quantity : 250 pcs
Repair printing press
- Detailed description of service

- Order quantity
- Acct assgmt
Specs
Cost control via

limits
Service entry sheet
?
?
?
Feb. 3
Item 10
Oil filter changed
M
Cctr 123
Feb. 3
Limit adhered to
Release procedure
GR for PO 12345, item 10
Acceptance
SAP AG 1999
n Stock materials are subject to inventory management, whereas services are

procured for direct consumption.
n As well as the other account assignment categories, you can use the account
assignment category U (unknown) for service items, as the account assignment is
often not yet definite when the goods are ordered.
Page 59

Service Specifications in the Purchasing Document
n Materials are procured at
item level.
Purch.
Purch. ord.
ord.
Service specifications
01
Outline level
Services are procured below

item level. The item type D
activates the service
functions and controls or
allows you to create service
specifications.
Service line
02
Selection of software components

01 Define requirements
Consultant
K4 10 days at 2100 UNI
Adapt components
01 Component
Consultant
A
K3 5 days
at 1900 UNI
02 Test configuration
Consultant
K3 4 days
Unplanned services
to a max. of 60000 UNI
at 1900 UNI
Value limit
SAP AG 1999
An item contains a short text, which is a general description of what you intend
to procure. The service specifications are an exact description of the service.
Page 60

Service Entry and Acceptance
Accept.
Entry
The system stores services

that have been performed in
Service
Service
service entry sheets. The
entry sheet
entry sheet
relevant postings are made
Total value
in Financial Accounting and
22000 UNI
Cost Accounting when the
Services
.
.
service entry sheets are
.
signed off. Service entry
sheets can be entered and
signed off in one transaction
FI and CO update
or in two steps.
When entering services, you reference the purchase order. You can copy
planned services directly from the purchase order into the service entry
sheet. You do not give an exact description of unplanned services or their
quantity and price details until you enter them. The system checks whether
the unplanned services adhere to the limit defined in the purchase order.
SAP AG 1999
You can set up release procedures for service entry sheets.

Page 61

Invoice Verification for Entry Sheet
n The Logistics
procedure is carried
out with reference to
the purchase order.
n This means that all
service entry sheets
signed off for this
purchase order are
suggested for invoice
verification.
Invoice
ABC
Software GmbH
o.k.
?
Sheet 1 31 Mar.
26000 UNI
Vendor invoice
Vendor: ABC
Software GmbH
Value 20000 UNI

Service
entry sheet
PO no.
PO itm
Sheet 1
Sheet 3
Invoice
document
SAP AG 1999
n The system compares the prices on the invoice with the prices from the
service entry sheets.
n If there are no discrepancies, you can enter and post the invoice.
n If the system finds any discrepancies, it blocks the invoice for payment.
Page 62
0346722
01
20000 UNI
6000 UNI
26000 UNI
Service Entry Sheet
When entering services

performed, you reference the
purchase order.
Planned services
These can be adopted
directly in the service entry
sheet.
Unplanned services
In this case, a precise
description, quantity, and
price data are not provided
until the services actually
performed are entered into
the system.
The system checks whether
the unplanned services
conform to the limit set in the
purchase order
Page 63
Agenda

Master Data
Procurement Cycle
Valuation
Price Control
Page 64
MM
MM
Master
Procurement
ProcurementMaster
Data
Data
Objectives
Understand the concept of Inventory Management as it relates to the

Materials Management module in SAP
Be able to identify the key SAP Inventory Management activities and
documents used in the Materials Management module
Map PCBL Inventory Management Activities to SAP
Execute key inventory management transactions in the Materials
Management Module
Page 65
Inventory
Inventory
Management
Managemen
Contents
1.
Overview
2.
Stock Types
3.
Material Movement
Movement Types
4.
Material Document
Goods Receipt
Goods Issue
Transfer Posting
Special Stocks
Consignment Stock
5.
Subcontracting Stock
Physical Inventory
Physical Count
Cycle counting
Page 66
Inventory Management Overview
Goods movements
Stock types
Movement types
Material & accounting documents
Page 67
Inventory Management Overview
Inventory management involves the receipt, storage, control and

disbursement of materials and supplies.
Goods are
physically
received
Goods are
stored and
movements
are tracked
Goods are
controlled
(physical
inventory)
Page 68
Goods are
either
consumed or
dispersed
What is inventory management ?
SAP's Inventory Management system allows you to

manage your stocks on a quantity and value basis
The stocks are managed not only on a quantity basis but also
by value - a prerequisite for cost accounting. With every goods
movement, the following values are updated:
the stock value for inventory management
the account assignment for cost accounting
the corresponding G/L accounts for financial accounting via
automatic account assignment
Page 69
Integration with other modules
Integration in Materials Management (MM)

As a component of Materials Management, Inventory Management is
directly linked with Material Requirements Planning , Purchasing, and
Invoice Verification.
Inventory Management forms the basis for material requirements
planning, which takes into account not only physical stocks but also
planned movements (requirements, receipts).
Quantities and values from the purchase order and the goods receipt
document are checked to ensure conformity with those in the invoice.
Page 70
Stock Types
Indicate what quantities of the material are in what types of stock

Three main (frequently used) types:
Unrestricted-use stock
Stock in Quality inspection
Blocked stock
Page 71
Stock Types
In Inventory Management, there are three stock types that indicate a

materials usability.
Unrestricted-use stock: A companys own stock that is physically

located in the warehouse, is valuated, and is not subject to any
restrictions on usage.
Quality inspection stock: A companys own stock that is in quality

inspection. Quality inspection stock is not valuated(in SPD) and is not
for unrestricted use.
Blocked stock: This refers to the quantity which is pending quality

decision or excess supplies. It is not for unrestricted use in Inventory
Management and it is not valuated.
Page 72
Stock Types in Goods Receipt
Goods Receipts
Unrestricteduse stock
Stock in Quality
Inspection
Blocked stock
Scrapping / Sampling
Transfer
Consumption
Page 73
Documents for Goods Movement
Storage Location
Entry
Material
Exit
Goods movement
When posting any transaction for goods movement, two types of documents are created:
Material
document
Accounting
document
Page 74
Material Movement
Documents for Goods Movements
The document principle also

applies in IT-based
Inventory Management. A
document is the proof that
a transaction involving
stock changes has taken
place. Documents are
stored in the system.
n
A material document is
created in the SAP
System as proof of a
transaction involving stock
changes.
n
Warehouse
Warehouse
Goods movements
Receipts
Accounting
document
Material
document
As soon as a goods movement is posted, the quantities, material, movement

SAP AG 1999
type and organization level can no longer be changed. You can only change
the text. If you want to correct errors, you must create a new document. You
can reverse or cancel the incorrect document.
Page 75
Goods Movements
Vendor
Goods receipt
Storage Loc 2
Transfer posting
Storage Loc 1
Goods issue
Scrapping
Page 76
Consumption
Goods Movements
Definition of Goods Movement

A goods movement is an event that causes a change in stock.
Stock Transfer
Transfer of material from one plant to other plant or from one storage
location to other storage location (Within same plant or belonging to two
different plants) or one company code to another company code
Transfer Posting
Changes in stock type or stock category of a material
Not necessarily occur in conjunction with physical movement, e.g.
transfer from quality inspection to unrestricted
Examples of transfer postings are:
Transfer Postings From Material to Material
Release from quality inspection stock
Transfer of consignment material into company's own stock
Page 77
Material Movement
A movement type is a three-digit identification key for a goods movement. A

movement type must be entered to differentiate between the various goods
movements.
Mov. type
Description
101
102
301
309
321
349
311
551
Goods receipt for Purchase Order into warehouse

Goods receipt for Purchase Order into warehouse - reversed
Transfer from one plant to another plant.
Transfer posting from material to material
Transfer Posting from QI to Unrestricted Stock
Transfer posting from blocked stock to QI stock
Transfer from storage location to another storage location.
Withdrawal for scrapping
Page 78
Physical inventory
Every company must carry out a physical inventory of its warehouse stocks
at least once per fiscal year to balance its inventory
Stocks that can be inventoried
unrestricted-use stock in the warehouse
quality inspection stock
Blocked stock
Page 79
Physical Inventory Process
The process of physical inventory can be divided into three phases:

Physical inventory preparation
Create a physical inventory document.
Block materials for posting.
Print and distribute the physical inventory document.
Physical inventory count
counting stocks
entering the result of the count on the physical inventory document
printout
Physical inventory analysis
entering the result of the count into the system
initiating a recount, if necessary
posting inventory differences
If the difference is accepted, it is posted and stock is corrected.
Page 80
Physical Inventory Process Flow
The Physical Inventory Process
Create physical
inventory document1
Blocking indicator
2
Print physical
inventory document
Initiate
recount
5b
Change
count
Enter physical
inventory count 4
List of
differences
5
Post
differences
SAP AG 1999
Page 81
5a
Types of Physical Inventory
Periodic Inventory
In a periodic inventory, all stocks of the company are physically counted on the
balance sheet key date.
Continuous Inventory
In the continuous inventory procedure, stocks are counted continuously during
the entire fiscal year. In this case, it is important to ensure that every material
is physically counted at least once during the year.
Cycle Counting
Cycle counting is a method of physical inventory where inventory is counted at
regular intervals within a fiscal year. These intervals (or cycles) depend on the
cycle counting indicator set for the materials.
Inventory Sampling
In MM Inventory Sampling [Ext.] randomly selected stocks of the company are
physically counted on the balance sheet key date. If the variances between
the result of the count and the book inventory balance are small enough, it is
presumed that the book inventory balances for the other stocks are correct.
Page 82
Cycle Counting
Cycle Counting
n Cycle counting is a method of
physical inventory whereby material
is counted at regular intervals within
a fiscal year. These intervals (or
cycles) depend on the cycle
counting indicator set for each
material.
n Cycle counting allows fast-moving
items to be counted more frequently
than slow-moving items, for
example.
Physical inventory
Cycle counting
Stock:
Plant 0001
Stock
Indicator:
B
B B C
A
...
Inventory frequency:
SAP AG 1999
Page 83
12 x
6x
4x 1x
...n x
Cycle Counting Setting the indicator

Setting the Indicator
Memory
1.
Manually
2.
Via report
(RMCBIN00)
Material
Material
master
master
record
record
cc- A
Consumptionbased analysis
Requirementsbased analysis
Analysis
Material Text
Value
$
PP-001...
21,500
PP-008...
20,330
PP-015...
SAP AG 1999
Page 84
CC CC
Quantity new old
Pc.
Plant 0001
No.
Text CC CC
19,850 Material
new old
PP-001..
A
15,100 PP-008
A A
PP-015
B B
B A
C A
C C
...
All materials to be included in

the cycle counting inventory are
classified. This is done either
manually, using a cycle
counting indicator in the
material master record (storage
data), or automatically, by
means of an ABC analysis. The
cycle counting indicator allows
you to classify materials into
individual cycle counting
categories (e.g.: A, B, C, D) In
Customizing, you can then set
different time intervals for
inventory of different materials.
Agenda Day 4
Section
Topics
1.
2.
3.
Master Data
4.
Procurement Cycle
Valuation
Price Control
10
Page 85
Page No.
Logistics Invoice Verification
Objectives
Understand the concept of LIV (3 way matching) as it relates to the
Materials Management module in SAP
Be able to identify the key SAP LIV options, activities and documents used
in the Materials Management module
Map PCBL Invoice Verification Activities to SAP LIV Cycle
Execute key LIV transactions in the Materials Management Module
Page 86
Contents
1.
2.
3.
Logistics Invoice Verification
Invoice Entry
Invoice Posting
Invoices with Variances
Blocking Invoices
Releasing Blocked Invoices

Automatic Settlement
Credit Memos and Reversals
Page 87
Logistics Invoice Verification : Overview
An incoming invoice can be

posted with reference to a
purchase order, goods receipts,
or vendor.
The invoice items are created

automatically; the corresponding
account postings are carried out
automatically.
After the invoice has been

posted, the document appears
as an open item on the vendor
account (payment proposal list).
Page 88
Logistics Invoice Verification in Materials Management serves the following

purposes:
It completes the materials procurement process
It allows invoices that do not originate in materials procurement
(for example, services, expenses, course costs, etc.) to be
processed
It allows credit memos to be processed, either as invoice
cancellations or discounts
Logistics Invoice Verification does not handle the payment or the analysis of
invoices.
The information required for these processes is passed on to A/C
department.
Page 89
Invoice Entry
When an invoice is received at the

Accounts Payable department, its details
are entered into the SAP system to
match the details of the Purchase Order
and Goods Receipt
Purchase Req.
PURCHASE ORDER
Purchase Order
No. 890 ORDER

PURCHASE
Vendor No. 1304
No. 890 ORDER

PURCHASE
Vendor No. 1304

Item No. 27
PURCHASE ORDER
No. 890 ORDER

PURCHASE
Vendor No. 1304

Item No. 27
Tolerance levels can be set for matching

invoices in MM
Unmatched invoices can be blocked for
payment and trigger warnings and
activities for the purchasing department
Page 90
Vendor No. 1304
No. 890
Vendor No. 1304

Item No. 27
SUBSTITUTE
ITEM
Item No. 27
SUBSTITUTE
Item No. 27
ITEM
SUBSTITUTE
No. 890
No. 890 ORDER

PURCHASE
Vendor No. 1304

Item No. 27
ITEM
SUBSTITUTE
SUBSTITUTE
ITEM
SUBSTITUTE
ITEM
ITEM
Goods Receipt
Invoice Entry
Invoice Processing
n If there are discrepancies
between the purchase order or
goods receipt and the invoice, the
system warns the user, and
depending on how the system is
configured, blocks the invoice for
payment.
The posting of the invoice
completes the Logistics Invoice
Verification process. The system
updates the purchase order
history and Financial Accounting
initiates payment for the open
invoice items. Logistics Invoice
Verification creates a link between
Materials Management and
external or internal accounting.
Master data
Invoice verification
Invoice
Purchase
order
SAP AG 1999
Page 91
Mat. doc. for

goods receipt
Invoice
document
Payment
program
Preliminary Posting
When an invoice is parked, the

data entered is saved (even
when the entries do not
balance).
However, no postings are made.
A parked document can be
changed as often as you like.
The actual checks are only
made within the function Post
parked document.
Account postings are made
when a parked document is
posted.
Parked documents are recorded
in the purchase order history.
Preliminary posting is linked to
Workflow.
You can branch directly from
Logistics Invoice Verification to
Preliminary Posting.
Preliminary Posting
Invoice
Park
Doc. 51000123
Change
Vendor 100 GR/IR 100 +
Post
Document
Vendor 100 GR/IR 100 +
SAP AG
Page 92
GR/IR Account
Vendor Account
Purchase Order History

Goods receipt
Invoices
Parked invoices
Posting an Invoice
When an invoice is posted, the

following occurs:
the individual items are
posted to the corresponding
accounts
a document is created
the material master is updated
the purchase order history is
updated
Posting an Invoice
Invoice
for purchase
order
GR/IR Account
Vendor Account
Posting
A
XX
B
XX
Doc. no. 51000123

Vendor
GR/IR
100 100 +
Material master
Moving Avg Pr
value
Purchase order history

goods receipts
down-payments
invoices
UNIT 7.PPT 11/28/97 / 1
SAP AG, 1997
Page 93
Blocking the invoice
When an invoice is blocked, Financial Accounting cannot pay the

invoice.
The invoice must first be released in a separate step before it can
be processed.
Variance
Variances in an Invoice Item
Quantity variance (M)

Price variance (P)
Variance in order price quantity (G)
Schedule variance (T)
Quality inspection (I)
Invoice
Goods receipt
GR 40
Purchase
order
$ 5.00
Quantity
50 pcs
Invoice
Price
@ $ 6.00
Invoice
10 pcs
Goods receipt
10 pcs = 200g
Purch.Order
10 pcs @
$20/kg
= 250 g
Purchase order
price quantity
Invoice
10 pcs
= 2 kg
Purch.Order
Planned
delivery date 12.21.96
= 2.5 kg
Invoice
Date
12.11.96
UNIT 7.PPT 11/28/97 / 1
SAP AG, 1997
Page 94
Credit memos
The term credit memo always refers to a credit memo from the vendor.
Posting a credit memo always leads to a debit posting to the vendor
account.
Two types of credit memos are possible:
Credit memos that refer to a purchase order or goods receipt
Credit memos that do not refer to a transaction.
Processing of credit memos is same as invoice verification
Page 95
Credit Memos and Reversals

Credit Memos
n You usually receive a credit

memo from a vendor if you were
overcharged.
n A credit memo can be
entered with reference to a
purchase order or a goods
receipt.
n If you enter a credit memo
for a purchase order item
because the vendor has
invoiced you at too high a price,
you must post the credit memo
as a subsequent debit/credit.
The total quantity invoiced for
the purchase order item remains
the same; the total value
invoiced is reduced.
Purchase
order
4151599035
100 pcs
10.00 UNI/pc.
Invoice
Credit memo
PO 4151599035
PO 4151599035
80 pcs
800 UNI
30 pcs
300 UNI
Create
credit memo
PO 4151599035
Goods receipt
50 pcs
Purchase
order
4151599036
100 pcs
10.00 UNI/pc.
SAP AG 1999
Page 96
Invoice
Credit memo
PO 4151599036
PO 4151599036
50 pcs
800 UNI
50 pcs
300 UNI
Create
subsequent credit
PO 4151599036
Agenda
Material Management
Master Data
Procurement Cycle
Valuation
Price Control
Page 97
Material Valuation
Objectives
Understand Material Valuation concepts used in the MM module.
Understand the Valuation Structure such as
Valuation Level
Valuation Class
Split Valuation
Valuation Category
Valuation Type
Understanding the Valuation Procedure & Price Control
Understand the Logic of Account Determination
Page 98
Transactions Involved in Material Valuation
Transactions in Inventory
Management that affect
Accounting are goods receipts,
goods issues and transfer
postings (for example, a stock
transfer between two plants or a
transfer posting from one
material to another). These
transactions can change the
valuation price of the material,
depending on the type of price
control.
Postings in Logistics Invoice
Verification can also affect
Material Valuation.
Transactions Involved in Material Valuation

Requirements determined in
requirements planning
External procurement
Purchasing
Internal procurement
Production
Master data
Goods
receipt
Material
Batch
Vendor
G/L account
Customer
Storage
locations
.
.
.
Warehouse
Management
Invoice receipt
Goods
issue
Transfer
posting
Internal and external accounting

SAP AG
Page 99
SD
Material Valuation Levels
Inventory management for values and

quantities always takes place at
the level of the valuation area.
Valuation area = Company code:

You create valuation data for a
material for each company code.
The price control and price of a
material are valid per company
code. This ensures that a material
is valuated at the same price in all
the plants belonging to a company
code.
Valuation area = Plant:
You create valuation data for a
material per plant. The price
control and price of a material are
valid per plant. This enables the
same material to have different
values in different plants.
Page 100

0001
Company code
Plant
Valuation area
R
SAP AG
Valuation Class
Valuation Class
Material type
Valuation class 1
Accounting 1
300000
Valuation class 2
Valuation class
300100
Material
master
You can use the valuation class to combine materials for assigning G/L
accounts so that you do not have to manage a separate stock account for
each material.
You maintain the valuation class in the Accounting view of the material master
record. The valuation class allowed for a material depends on the material
type, and can be configured in Customizing.
In automatic account determination, the R/3 System works with valuation
classes. The valuation class is used to determine which stock account is to be
updated upon goods movements.
SAP AG 1999
Page 101
Split Valuation
For certain materials, it is necessary to valuate the various stocks in a particular

valuation area separately. Reasons for this include:
Different origins of the material
Different grades of quality for the material
Different statuses for the material
Differentiation between in-house production and external procurement
Differentiation between different deliveries
Features
If a material is subject to split valuation, the material is managed as several partial
stocks, each partial stock is valuated separately.
Each transaction that is relevant for valuation, be it a goods receipt, goods issue,
invoice receipt or physical inventory, is carried out at the level of the partial stock.
When you process one of these transactions, you must always specify which
partial stock is involved. This means that only the partial stock in question is
affected by a change in value, the other partial stocks remain unaffected.
Alongside the partial stocks, the total stock is also updated. The calculation of the
value of the total stock results from the total of the stock values and stock
quantities of the partial stocks.
Page 102
Split Valuation
The valuation category indicates

whether the stocks of the material are
subject to joint or split valuation. The
valuation category is a key that defines
the criteria used to differentiate
between sub-stocks. It also defines the
valuation types that are allowed.
The valuation type is a key that
identifies stocks of a material that are
subject to split valuation. It defines the
form of a sub-stock.
You enter the valuation category in the
material master accounting data for
each company code in which the stock
is subject to split valuation.
You define valuation categories and valuation types in Customizing. You also
define the assignment of valuation types to a valuation category, the valuation
categories that are allowed in a company code, and special indicators
according to the requirements of your company.
Page 103
Valuation Procedure and Price Control
Material Valuation Procedures
In the R/3 System,

material valuation can be
carried out according to
the moving average price
procedure (V price) or the
standard price procedure
(S price).
Material valuation
Price control
(in material master)
S
Standard price
V
Moving average price
In the standard price procedure (price control S), the system carries out all
stock postings at a price defined in the material master. Variances are posted to
price difference accounts.
In the moving average price procedure (price control V), the system valuates
goods receipts with the purchase order price and goods issues with the current
moving average price. The system automatically calculates the latter upon every
goods movement by dividing the total value by the total stock quantity.
Differences between the purchase order price and the invoice are posted directly
to the relevant stock account if there is sufficient stock coverage.
SAP AG 1999
Page 104
Valuation Procedure and Price Control

Valuation of Goods Receipts
You set the material

valuation procedure you
want to use in the
accounting view of the
material master record. In
the R/3 System, you can
carry out material
valuation using the
standard price procedure
or moving average price
procedure.
V (Moving average price) = value / quantity

Stock account
Accounting 1
GR/IR
250
Price control
250
Amount from purchase order
S (Standard price) = fixed

Stock account
Material
master
200
GR/IR
250
Standard price * quantity Amount from purchase order

Price difference
50
SAP AG 1999
Irrespective of the valuation procedure set in the material master record, the
system increases the stock quantity by the relevant goods receipt quantity when
you post a goods receipt into stock.
Page 105
Objectives
Understand the concept of MSR as it relates to the Materials Management
module in SAP
Identify and map the key criteria for Vendor Evaluation
Execute key procurement transactions in the Materials Management
Module
Page 106
Contracts
Contracts
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
orders for a contract. A
release order is a
purchase order that
references a contract.
PReq.
Manual
RFQ
10
10
10
20
20
20
30
30
30
Info record
5300007152
Vendor:
1234
Contract
10
20
30
Vendor
Release
documtn
Contr. rel. ord.

...
SAP AG 1999
Page 107
Contract
Material: Nail
A21
PurchOrg:
3000
Conditions
Price/UoM 6 UNI / kg
Freight
2%
Discount
5%
Last purch. order:
4500019324
Contracts
Types of Contract
Target qty: 50 000 m cable
Contract
at 300 UNI per m
A contract is a longQuantity
term agreement with a
contract
(MK)
vendor concerning the
supply of material or
performance of
services.
Target qty: Materials at a
Contract
You can create

value of 150 000 UNI
Value
contracts manually.
contract
When doing so, you
(WK)
can reference other
contracts, purchase
requisitions, and RFQs
or quotations.
One of the things you define
in the contract header is the validity period.
For each item in a quantity contract, you define the target quantity and
purchase order conditions.
SAP AG 1999
Page 108
Contracts
Plant Contract/Centrally Agreed Contract
Contract items can relate to a

single plant or to all plants
covered by a purchasing
organization (centrally agreed
contract).
All the plants of a purchasing
organization can order against
a centrally agreed contract.
Contract 1
Plant 1000
Item Mat.
10
Plant 2000
Plant
Contract 2
Item Mat.
Plant
10
3000
An enterprise working with a central purchasing

organization covering several
Plant 3000
plants can negotiate better conditions at a high level.
Centrally agreed contracts can be entered into with a vendors entire corporate
group. The individual contract release orders can be issued to different individual
companies belonging to the vendor corporate group. This is made possible by
the partner functionality.
SAP AG 1999
Page 109
Contracts
Items of a centrally
agreed contract do not
relate to just one
specific receiving
plant.
All the plants covered
by a purchasing
organization can order
against a centrally
agreed contract.
Plant Conditions in Centrally Agreed Contracts
Contract
Vendor
Period
Material
Total qty.
Price
Release
order
:A
: 01.01.12.31.
:1
: 10,000 pcs. Plant conditions
: 100.00
Plant 1000: surcharge 5%
Vendor
:A
Material
Plant
Qty.
Price
:1
: 1000
: 100 pcs.
: 105.00

An enterprise that works with a central purchasing organization covering
several plants can negotiate

better conditions at a high level.
SAP AG 1999
Using the Plant conditions function, the centrally agreed contract allows you
to stipulate separate prices and conditions for each receiving plant. Among
other things, you can take account of differing transport costs for different
supply routes.
Page 110
Function of Vendor Evaluation
The vendor evaluation

functionality supports you in
optimizing the procurement
process.
It facilitates the process of
source selection and the
ongoing surveillance of existing
supply relationships.
Function of Vendor Evaluation

Price
Price simulation
simulation for
for material
material 11
Vendor
Vendor AA
10.20
10.20
Vendor
Vendor CC
9.90
9.90
Vendor
Vendor BB
11.80
11.80
Evaluation
Evaluation for
for material
material 11
General
General vendor
vendor evaluation
evaluation
Overall
Overall Price
Price Qual.
Qual. Deliv.
Deliv. Service
Service
Overall
Overall Price
Price Qual.
Qual. Deliv.
Deliv. Service
Service
Vendor
Vendor BB
90
92
90
93
85
88
81
93
92
86
Vendor
Vendor AA
84
75
92
88
81
90
94
92
88
86
Vendor
Vendor CC
81
90
76
74
84
80
85
82
79
74
SAP AG
Page 111
Scoring Level in Vendor evaluation
The evaluation of a vendor is reflected

in the latters overall score. This is a
combination of the scores the vendor
achieved for each of the main criteria.
The scores for main criteria and subcriteria reflect a vendors performance
more accurately than the overall
score.
The scores achieved by a vendor for
the individual criteria may be of
varying significance to you. The
weighting factor takes account of this
fact.
Sub-criteria are divided into manual,
semi-automatic, and automatic
criteria, according to the method by
which the scores awarded for them
are determined.
Scoring Levels in Vendor Evaluation

Overall score
Weighted
Scores for main
criteria
Weighted
Scores for
subcriteria
Individual scores
SAP AG
Page 112
Evaluation Criteria
Overall score
for vendor
Overall
Performance
Weighted
Price
Quality
Delivery
Price level
Goods
receipt
On-time
delivery
Price
history
Quality
audit
Quantity
reliability
Rejection
level
Shipping
instruct.
Confirmation
date
Page 113
Support
External
Service
Score for
main criteria
Weighted
Score for
sub-criteria
Sub-criteria with
automatic scoring
Analyses of Vendor evaluation
The ranking list sorts your vendors in

descending order according to their overall
scores. This gives you an overview as to
which vendors rank among the best, which
perform moderately well, and which are
below average.
The list of evaluations per material or
material group provides you with a ranking
list based on a certain material or material
group. This analysis enables you to
determine which vendors of a particularly
important material have performed well,
moderately well, or poorly.
The evaluation comparison is an analysis
that compares the general evaluation of a
vendor with the latters evaluation in
respect of a certain material.
Page 114
Analyses in Vendor Evaluation

Ranking
Ranking list
list
General
vendor
evaluation
General vendor evaluation
Overall
Overall Price
Price Qual.
Qual. Deliv.
Deliv. Service
Service
Vendor B
90
92
90
93
85
Vendor A
84
75
92
88
81
Vendor C
81
90
76
74
84
Evaluation per material/material group

General
General vendor
vendor evaluation
evaluation
Overall
Overall Price
Price Qual.
Qual. Deliv.
Deliv. Service
Service
Vendor A
84
75
92
88
81
Vendor C
81
90
76
74
84
General vendor evaluation
Evaluation
Evaluation comparison
comparison
Evaluation
Evaluation for
for material
material 11
Overall Price Qual. Deliv. Service Overall

Overall Price
Price Qual.
Qual. Deliv.
Deliv. Service
Service
Vendor A
SAP AG
84
75
92
88
81
88
81
93
92
86
Material Requirement Planning Overview
Materials Requirements Planning

The main function of SAP Material Requirements Planning is to guarantee
material availability, it is used to procure or produce the requirement
quantities on time both for internal purposes . This process involves the
monitoring of stocks and, in particular, the automatic creation of procurement
proposals for purchasing .
Page 115
Reorder Point Planning

Variables >
Safety Stock
Expected average material consumption
Replenishment Lead time
Types
Manual
Automatic
A Manual Reorder Point Planning
Input
Reorder Point
Safety stock
B Automatic Reorder Point planning
System Calculates
Reorder Point
Safety stock
Page 116
Re-order point planning

n The manual reorder point

procedure uses the MRP indicator
VB.
n The reorder point procedure is
based on a comparison between
the warehouse stock and the
reorder point. If the available
warehouse stock is less than the
reorder point, the system initiates
requirements calculation.
Lot size
Stock
Reorder
point
Safety
stock
Reorder point
Delivery
time
Time
Replenishment
lead time
n The reorder point comprises the expected average material requirements

during the replenishment lead time and the safety stock. The following values have
to be taken into account when the reorder point is defined:
The safety stock.
Prior consumption or future requirements.
The replenishment lead time.
n The safety stock is used to cover unplanned excess consumption during the
replenishment lead time and additional requirements in the case of delivery holdups.
SAP AG 1999
Page 117
n In reorder point planning,

the available warehouse stock
is calculated from the following:
Warehouse stock + order
quantity (purchase orders, firm
planned orders, and firm
purchase requisitions).
Net Reqmts Calculation in Reorder Point Planning
Shortage
Order proposal
for qty of lot size
Available warehouse stock
Re-order point planning
Reorder point
Purchase orders
Firm planned orders

Firm purch. requisitions
Comparison
Stock
n If the available warehouse stock is less than the reorder point, there is a
shortage of materials.
SAP AG 1999
n The shortage quantity is the difference between the reorder point and the
available warehouse stock. The purchase order quantity is derived from the lotsizing procedure in the material master record.
The system bases the requirement date on the planning date
Page 118
Thank You
Page 119

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Training Manual Materials Management

Material Management Overview

Managing Supplier Relationship

Material Requirement Planning

Material Management Overview

Managing Supplier Relationship

Material Requirement Planning

Materials Management Overview

External procurement of materials and services ,

Materials Management Overview

What is Materials Management ?

Materials Management Overview

The processes of Material Management are based on various types of

Materials Management Overview

This diagram illustrates a typical SAP-supported procurement cycle.

Material Management Overview

In the SAP R/3 System,

Materials Management Organizational Elements

Plant is an organizational unit that structures the enterprise from the

Plant can be for example

Regional sales office

Central distribution center

Plant is assigned to a company.

Material is usually valuated at plant level.

A physical location within a company, where materials are stored,

Physical inventory is carried out at

Purchasing Organization and Group

Purchasing organization subdivides an enterprise according to the requirements

Purchasing organization procures materials and services, negotiates conditions

Organisational Elements in MM Purchasing:

Centralized Vs Decentralized Purchasing

You can organize your purchasing function in the following ways:

The purchasing organization is further subdivided into purchasing

Material Management Overview

Material Management : Master Data

The processes of Material Management are based on various types of Master

Material Master Data

Material master in SAP.

The material master contains information on all the materials that a

Use of material master in

In Purchasing for ordering materials.

Material Master Key points

The Material Master is used by several areas of the system in addition to

Material Master Views

MRP Type, or MPS

User departments using same material master

It determines type of industry .

Plant Engineering & Construction

Gas, Oil, Electricity, Water, Utility supplies

Legal, Consulting, Construction services

Nuts, gears, motors

Vendor Master Data

Concept of vendor master in SAP

vendor master record is maintained by both Accounting and Purchasing.

A Vendor Master Record stores information pertinent to a companys vendors.

for all clients

Service Master Record

Contains the description of a service

Concept of Purchasing info Record

An info record represents a material-vendor relationship.

Info Records- Key points

Purchasing Info Records contain information on a specific material and