Vendor Master Data & Records, and Purchasing Information Data

Vendor Master Data & Records,
and
Purchasing Information Data
EGN 5620 Enterprise Systems Configuration

(Professional MSEM)
Fall, 2013
Types of Buyer/Supplier Relationships

Antagonistic
Parties view each other as the enemy (lose/lose)

Adversarial
Each party attempts to maximize their gain

(win/lose)
Cooperative
Parties understand the benefits of working

together (win/win)
Collaborative
Parties look for opportunities to create value

(win/win)
January 2008
SAP AG - University Alliances and

The Rushmore Group, LLC 2008. All
rights reserved.
Trend in Buyer/Supplier Relationships

Traditional
purchasing process tends to
Create an environment of mistrust and low

bidder mentality,
Leading to higher total purchasing costs
Trend
is
Collaborative partnership
To establish long term product/service supply
contact agreements
Via identifying, qualifying, and cultivating longer
term suppliers/partners
January 2008

rights reserved.
Benefits of Managing the

Supply Base
Contract
with only world-class suppliers

The fewer suppliers, the lower the
purchasing overhead
Purchasing can pursue strategic sourcing
issues, instead of clerical functions
Streamline the supply chain
Improve overall quality
Improve delivery performance
January 2008

rights reserved.
Process for building a supply base

1.
2.
3.
4.
5.
6.
Identify need for long term supplier

contract (agreement)
Determine specific sourcing requirements
Identify potential suppliers
Determine method of evaluating suppliers
Select supplier for contract (agreement)
Negotiate and execute contract
(agreement)
January 2008

rights reserved.
Supplier Evaluation and Selection

A
critical step is to identify and evaluate

potential suppliers
It usually involves supplier development
aiming to
Develop partnership with good (product quality) suppliers
Improve total cost and delivery performance of purchased
materials and services
Qualification
process includes
Vendors qualification
Vendors product/service qualification (vendor sub-range)
January 2008

rights reserved.
Outline Agreement
Long-term
purchase agreements
Can be divided into the types below:
Contracts
Scheduling agreements
Can
be subject to a release (approval or

clearance) procedure
January 2008

rights reserved.
Contract Management
Track
for
supplier performance using metrics
On-time delivery
Material and/or service quality
Returned materials
Expedite issues
Pricing analysis
Resolve problems
Engage in continuous
improvement
process
Terminate/renew contract agreement
January 2008

rights reserved.
Contracting Questions
How
will potential suppliers be evaluated

and selected?
What procedures will be required to
manage the contracts (and suppliers)?
How will performance be measured?
How many are too many suppliers?
Too many suppliers cost money

Supplier integration
Collaborative agreements
Supplier development
Without material production shuts down
What
is the risk?
January 2008

rights reserved.
Creating a Contract
Is
a long-term agreement with a vendor to

provide a material or service
For an agreed upon period of time
At a negotiated price or quantity
Can
be created manually or with reference

to purchase requisition, Request for Quote
(RFQ)/quotation etc.
January 2008

rights reserved.
10
Contract types
Quantity
contract
Agreement with a particular vendor to purchase

a specific quantity of materials.
Example: Target quantity of 50,000 meters of
electrical wire at $2/meter. (MK)
Value contract
Similar to quantity contract except the
agreement is to purchase an established
monetary value of materials.
Example: Target value of $100,000 for electrical
wire. (WK)
January 2008

rights reserved.
11
Vendor Master Data & Records, and

Purchasing Information Data
SAP Implementation
(Professional MSEM)
Fall, 2013
Vendor Master Data

Includes
all data required for
processing business transactions and

corresponding with vendors
Information
is shared between the
accounting and
purchasing departments
January 2008

rights reserved.
13
Vendor Master Data & Records,

and Purchasing Information Data
Vendor
master data and records are

maintained by both
accounts payable (A/P) and
purchasing
Purchasing
information data are

maintained primarily by
purchasing
January 2008

rights reserved.
14
Vendor Master Data

A
master record must be created for

every vendor
General data,
Company Code data (Financial Accounting FI), and
Purchasing data (Material Management - MM)
General data
Address
Control data
Payment
transactions
Company code data

Account management
Payment
transactions
January 2008
Purchasing data
Condition
Control data
Partner functions
rights reserved.
15
Vendor Master
Structures of the Data
General Data
Company Code Data

Financial Accounting (FI)
ata:
D
l
a
er
Gen ess
r
Add
Pu
r
Da chas
in
ta
Vendor 10001
Purchasing Data (MM)
January 2008

rights reserved.
16
Vendor Master Data Typical

Screen
Vendor attributes that sufficiently
differentiate them by their:
Address
Control
Payment Transactions
Accounting Information
Correspondence
Purchasing Data
Partner Functions
January 2008

rights reserved.
17
Vendor Master
General Data Address
General Data Address

Address
Vendor Name
Search Term
Street address
City, Region Postal code
Country
Communication
Language
Telephone, Fax, E-Mail
January 2008

rights reserved.
18
Vendor Master- General Data

Control Data
Account
Control
Customer (if the vendor is both a vendor and a

customer)
Authorization
Trading partner (if the vendor is a part of an
independent company)
Group key (combines vendors to enhance the
search capacity)
January 2008

rights reserved.
19
Vendor Master- General Data

Control Data
Tax
Information
Tax codes
used to enter ID number of the vendor
Fiscal address
Country code
City code
Reference
Data / Area
International locator number
used to identify a legal, functional, or physical

location within a business or organizational entity
Industry key
allows similar vendors to be grouped by industry
Transport zone
January 2008

rights reserved.
20
Vendor Master - General Data

Bank
Details
Bank Key
selected from a match code with company code entered
Bank Account
Account Holder
Partner Bank Type (if vendor has more than one bank
account, then it allows to sequence those accounts)
Payment
Transactions
Alternative Payee
used to enter another vendor number
Instruction Key
To control which statements are given to the banks during the
payment order
January 2008

rights reserved.
21
Vendor Master Accounting

Information
Accounting
Information
Reconciliation Account
see next slide
Sort Key
used to select a sort for the allocation field
Release Group
the release-approval group can be defined and

configured to allow only those in the group to be
able to release for payment
January 2008

rights reserved.
22
An
individual G/L account recorded in line-item

detail in the sub-ledger and summarized in the
G/L
The information entered into the reconciliation
account is all line-item data from the vendor
account.
The reconciliation in the G/L is at the summary
level and is used to reconcile against the vendor
account at the total level, while the sub-ledger
identifies line-item data.
January 2008

rights reserved.
23
Postings
to sub-ledgers (such as accounts

receivable or accounts payable) are
automatically concurrently posted to the
corresponding reconciliation account in the
General Ledger
Thus, the General Ledger is automatically
updated and remains in balance with the
customer and vendor individual account totals
January 2008

rights reserved.
24
Vendor Master Accounting

Information
Interest
Calculation
Interest Calculation Indication
for automation interest calculation, and is

configured by accounting department
Interest Calculation Frequency
used to select a period for calculation of interest
Withholding
Tax
Withholding Tax Code

Exemption Number
January 2008

rights reserved.
25
Account Groups
Identifier
that controls which fields must

be entered when an account is created
Determine a valid number interval for
each of the groups (types) of General
Ledger accounts that have common
attributes
Must be created before General Ledger
Chart of Accounts master records can be
created
You must assign each account to an
appropriate account group
January 2008

rights reserved.
26
Account Groups
Chrt/accts
CHRT
CHRT
CHRT
Acct group
Description
BS
Balance Sheet (BS)
PL
Income Sheet
RA
Reconciliation
January 2008
From
100000
400000
110000
SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights
reserved.
To
399999
999999
310000
27
Account Groups
Account Group BS
Account control
Account management
Document entry
Bank/financial details
Interest calculation
Joint venture
January 2008

rights reserved.
28
Field Status
Field
status controls how the data will be

entered for a field when an accounting
master record is being used in a
transaction
Determining whether a field is required,
optional, suppressed, or display only
Field status controls are also relevant to a
specific activity create, change, or
display
January 2008

rights reserved.
29
Field Status Variant

Fld status groupText
ZALL
All Accounts
ZBSA
Balance Sheet Accounts
ZEXP
Expense Accounts
ZGRI
Material Management (GR/IR) Accounts
ZRCN
Reconciliation Accounts
ZREV
Revenue Accounts
January 2008

rights reserved.
30
Field Status Variant

Field status variant (V000) - Group ZBSA - Balance Sheet Acct.
General data
Additional account assignments
Materials management
Payment transactions
Asset accounting
Taxes
...
General Data
Suppress
Req. entry
Opt. entry
Display
Assignment number
Text
Invoice reference
January 2008

rights reserved.
31
Vendor Master Payment Transactions

Payment
Data
Payment Terms (cash discounts and favorable payment

periods offered by vendor)
Tolerance Group (the limit to which an event can deviate)
Check Double Invoice (to check for double or duplicate
invoices when they are entered)
Check Cashing Time
Automatic
Payment Methods
Alternate Payee
Payment Block(prevent any open items from being paid)
Invoice
Verification
Tolerance Group
January 2008

rights reserved.
32
Vendor Master
Correspondence Accounting
Dunning
Data
Dunning Procedure
To remind vendors to deliver the material from the purchase orders
Dunning Block
If selected, the vendor is not for dunning run
Dunning Recipient
Date of Legal Dunning Procedure
Correspondence
information
Local Processing
Accounting Clerk
Account With Vendor
used to identify the company
Clerk at vendor
the contact person at the vendor side
January 2008

rights reserved.
33
Vendor Master Purchasing Data

Conditions
Order Currency
Terms of Payment
Incoterms (next slide)
Minimum Order Value
Sales
Data
Salesperson
Telephone
Account with vendor
January 2008

rights reserved.
34

Incoterms
are standard trade definitions used in international contracts. The
International Chamber of Commerce based in Paris, devised these standard
trade definitions. The 13 incoterms are divided into four groups (arrival,
departure, carriage paid by seller, and carriage not paid by seller).
Group
E-Departure
D - Arrival
D - Arrival
D - Arrival
D - Arrival
D - Arrival
C- Paid
C- Paid
C- Paid
C- Paid
F - Unpaid
F - Unpaid
F - Unpaid
Incoterm
EXW
DAF
DES
DEQ
DDU
DDP
CFR
CIF
CPT
CIP
FCA
FAS
FOB
Long Name
Ex work
Delivered at Frontier
Delivered Ex Ship
Delivered Ex Quay
Delivered Duty Unpaid
Delivered Duty Paid
Cost and Freight
Cost, Insurance, Freight
Carriage Paid to
Carriage, Insurance Paid
Free Carrier
Free Alongside Ship
January 2008
Free on Board
Location
Named Place
Named Place
Port of Destination
Port of Destination
Destination
Destination
Port of Destination
Port of Destination
Destination
Destination
Named Place
Port
Destination
SAP
AGof
- University
Alliances and
Port of Destination
rights reserved.
35

Control Data
Acknowledgement Required
To indicate if acknowledgement is required upon receipt of the order
Automatic Purchase Order

To allow automatic issuance of purchase order
Good receipt-based invoice verification

To perform invoice verification based on the goods receipt amounts
Subsequent settlement
To allow a rebate
Default Data Material

Purchasing Group
Planned Delivery Time
Confirmation control (confirmation type and sequence)
January 2008

rights reserved.
36

Partner Functions
Partner
Functions
Used to define the relationships between the

vendor (or customer) and the company.
List
of (Vendor) Partner Functions
AZ
alternative payment recipient
CA
contract address
CP
contact person
ER
employee responsible
GS
goods supplier
OA
ordering address
PI invoice presented by
VN
vendor
January 2008

rights reserved.
37

Account Group
Vendor
masters are assigned to a vendor

account group
Through field status maintenance, vendor
account groups can be set up for one-time
vendors, regional vendors, and internal
vendors
The vendor account group controls both
type and number range assignment for
vendors
January 2008

rights reserved.
38
Purchasing Info Record

The
purchasing info record provides

continuously updated information about
the relationship of a specific material with a
specific vendor
Order unit, price, price changes, tolerances,
reminder information, historic data, statistics,
texts
Choice of automatic or manual updating
January 2008

rights reserved.
39
Source List
It
stores information about where to

acquire a given material for a given period
of time
It specifies whether this source should be
used by Materials Requirement Planning
(MRP)
January 2008

rights reserved.
40
Purchasing Tolerances
A
tolerance limit set for allowed variance

before a warning/error message is
displayed
Price variance
Compares the price in the purchase order with the
valuation price stored in the material master
Maximum cash discount

This tolerance limit is set to assure that cash
discounts do not exceed allowable discounts
January 2008

rights reserved.
41
Goods Receipts Tolerances

Purchase
order price quantity
Two tolerance levels maintained per item

The maximum percentage variance before a goods
receipt postings is not allowed
A percent variance that generates a warning
message but allows posting
Moving
average price variance
the maximum moving average price change

allowed
January 2008

rights reserved.
42
Invoice Receipts Tolerances

Tolerance
limits configured for invoice

receipts: price, quantity, and blanket
purchase orders
The tolerances include:
Amount for item with or without order

reference
Percentage Over/Under Quantity Variance
Exceed amount: quantity variance
Blanket purchase order (value and time limit)
Price variance
January 2008

rights reserved.
43
Automatic Account Assignment

Created
to avoid manual postings of

financial transactions which follow goods
movements to reflect the values of
transferred materials
Used across all modules to keep track of
the values of materials that are being
consumed (e.g., production), or transferred
into other valuation areas of the company
Is a set of rules and master data which
enable the financial tracking of logistics
movement
January 2008

rights reserved.
44

Valuation Grouping Code
Grouping Code
G001
Grouping Code
G002
Plant P001
Plant P004
Plant P002
Plant P005
Plant P003
January 2008

rights reserved.
45

Transaction Keys
Transaction
Keys
The transaction keys are used to determine

accounts or posting keys for line items which
are created automatically by the system.
The transaction keys are defined in the
system.
January 2008

rights reserved.
46

Transaction Keys
Transaction
Keys
Inventory Postings
BSX
Offsetting Entry for Inventory Postings

GBB
Materials Management Small Differences

DIF
Cost (price) differences (PPV)

PRD
Goods receipt / inv. receipt clearing acct

WRX
January 2008

rights reserved.
47

Modifier
Modifier
modifies the transaction key for

various movement types
Blank Goods receipt from purchase order

with account assignment
VBR Goods issue to consumption
VAX Goods issue to sales post to cost of
goods sold
AUF Goods receipt from a production order
post to production settlement
Etc. Many others
January 2008

rights reserved.
48
Material Types & Valuation Classes

Account
category reference:
Builds the link between material types and the

valuation class(es)
January 2008

rights reserved.
49
Material Types & Valuation Classes
Material Type
ROH (Raw Material)
Acct Cat. Ref

0001 Raw Materials
January 2008
Valuation Class
3000
(Raw)

rights reserved.
50

Valuation Class
3030 (Supplies Good)
Grouping Code
G_ _ _
Grouping Code
G_ _ _
Offsetting entry
GBB (Inv. posting)
Goods Movement
GBB (Inv. posting)
Account Modifier
Blank (Goods receipt)
Account Modifier
Blank (Goods receipt.)
Account
7210_ _
Plant P_ _ _
Valuation Class
3100 (Trading Good)
Account
7400_ _
January 2008

rights reserved.
51
Vendor Master Data & Records, &

Purchase Information Records
PEN, Inc.

(Professional MSEM)
Fall, 2013
Pen Inc. : Supplies
Pen Inc. : Vendor Master
Pen Inc. : Purchase

Information Records
Pen Inc. : Source List
Exercises:
114. Create sales organization

115. Assign sales organization to company code
117. Assign distribution channel to sales organization
120. Assign division to sales organization
122. Set up sales areas
125. Assign plant to sales organization and
distribution channel
126. Assign shipping point to plant
127. Create sales views for trading goods
204. Create raw materials inventory account
205. Create finished goods inventory account
206. Create raw materials expense account
207. Create finished goods expense account
Exercises
247. Define storage location for raw materials

248. Create production scheduling profile
249. Create production scheduler
250. Control Parameters for MRP
251. Assign availability check to order type
252. Define scheduling parameters for operations
253. Define control parameters for order type
254. Create confirmation parameters
255.Define valuation for goods received
256. Create material master for raw materials
257. Create material master for finished products

Vendor Master Data & Records, and Purchasing Information Data

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Vendor Master Data & Records, and Purchasing Information Data

Uploaded by

Copyright:

Available Formats

Vendor Master Data & Records,

EGN 5620 Enterprise Systems Configuration

Types of Buyer/Supplier Relationships

Parties view each other as the enemy (lose/lose)

Each party attempts to maximize their gain

Parties understand the benefits of working

Parties look for opportunities to create value

SAP AG - University Alliances and

Trend in Buyer/Supplier Relationships

purchasing process tends to

Create an environment of mistrust and low

SAP AG - University Alliances and

Benefits of Managing the

with only world-class suppliers

SAP AG - University Alliances and

Process for building a supply base

Identify need for long term supplier

SAP AG - University Alliances and

Supplier Evaluation and Selection

critical step is to identify and evaluate

SAP AG - University Alliances and

be subject to a release (approval or

SAP AG - University Alliances and

supplier performance using metrics

SAP AG - University Alliances and

will potential suppliers be evaluated

Too many suppliers cost money

SAP AG - University Alliances and

a long-term agreement with a vendor to

be created manually or with reference

SAP AG - University Alliances and

Agreement with a particular vendor to purchase

SAP AG - University Alliances and