Topic-3, 4, 5 (Basics) Conditions/ Purchase Info Records /Valuations in SAP MM

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SAP MM Basics- Conditions, Valuations and Purchase Info Records Portfolio

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About This Topic

In this topic, we will discuss the documents and master data in which conditions are used. We will also explain the difference difference between time-dependent and timeindependent conditions. Objective(s)

Explains the documents and master data in which conditions are used and the difference difference between timedependent and time-independent conditions.

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Conditions are agreements made with the vendor about prices, discount, freight, customs duty, and so on. In SAP system, you can maintain these conditions while maintaining a purchase order, order, info record, outline agreement, and quotations. Conditions maintained can be time-dependent or time-independent.

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Time-dependent conditions are valid for a particular time period. For example, conditions in info records, contracts, and general conditions are time-dependent. Time-independent conditions do not have any validity period. For example, conditions in purchase order are time-independent. time-independent. For quotations and scheduling agreements, you can use the document type to determine whether time-dependent conditions are available. 12/8/2013


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The condition type in Purchasing decides how the price is calculated in the SAP system. You can define condition type for gross price, tax, discount, and so on. Since condition types determine the price factor, while defining these conditions you can choose between absolute, percentage, or quantity-dependent. In a calculation schema, these condition types are grouped together to determine the effective price. A calculation schema is a group of different different condition types. Based on your enterprise requirements in the SAP system, you can create different calculation schema for purchasing organization and for vendors.

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Summary

• We now come to the end of the topic Conditions.

• You should now be able to discuss the documents and master data in which conditions are used. You You should also be able ab le to explain the difference difference between timedependent and time-independent conditions.

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About This Topic

In this topic, we will discuss the organizational levels relevant for purchasing info records, the options for creating purchasing info records, and the maintenance of a purchasing info info record. Objective(s)

Discusses the organizational levels relevant for purchasing info records, the options for creating purchasing info records, records, and the maintenance of a purchasing info record.

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-In the purchasing info record, you can store information about a vendor and the material supplied by him. -The information which is stored in the info record includes the current and future prices and conditions, delivery data, last purchase order, and different types of text such as PO text. 12/8/2013


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If a purchasing info record exists, then valid conditions have priority during price determination. If an info record does not contain any conditions or only contains invalid conditions, the system reads the number of the last purchasing document in the info record and then proposes the price from this document. The prices determined in this way are default values that can be changed by the buyer if necessary. 12/8/2013


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You can create or change an info record manually by calling transaction ME11 and ME12 respectively. When creating an info record, you can use the data from quotation, purchase order, and the outline agreement to enter details of vendor, material, and purchasing organization levels on the initial screen. Further, you can use these documents to enter other necessary data, such as conditions, gross price, and planned delivery time in the subsequent data screens. 12/8/2013


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-You can also create info record automatically. -If info record for certain material and vendor do not exist and you want to create an info record, you can set the indicator info update, while creating PO, maintaining RFQ, and outline agreement. This will generate an info record automatically. -When you create an info record from PO, the info record is created without conditions. No conditions are copied from PO to info records as conditions in PO are time-independent. -Hence you will have to maintain the conditions manually for info records created from SAP MM Basics- Conditions, Valuations and PO. 12/8/2013 Purchase Info Records Portfolio 12

-You can update info record conditions with or without plant. -For ME21N, ME22N and ME23N transactions these options are not available on screen. You can save these settings in customizing.

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For the quotations, contract, scheduling agreement, and old purchase order, the info update indicator has four attributes: -For attribute “No update”, the info record is not updated or created. -For attribute A, if the info record is available at the plant level or the purchasing organization level, it is updated. If the info record does not exist, it is created at the purchasing organization level. -For attribute B, if plant conditions are allowed for the plant, an info record at plant level is created or updated. -For attribute C, if plant conditions are not allowed for the plant, an info record at the purchasing organization level is updated or created. 12/8/2013


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Display Purchase Info Records for Material

http://youtu.be/bwUCB2OJmmg

SAP Portfolio- RFQ Basics

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Create Purchase Info Records with Info Update Set in Quotation

http://youtu.be/neuA5IBhbKU


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Conduct Price Simulation/ Analysis using Purchase Info Records

http://youtu.be/T63QkFD5g40


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About This Topic

In this topic, we will explain the significance of the valuation area, the function of the valuation class, and the material m aterial valuation valuation procedures. Objective(s)

Explains the significance of the valuation area, the function of the valuation class, and the material valuation procedures. p rocedures.

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Refer to the text in the next slide.

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In a company when you receive goods and issue or transfer goods, the stock level of items changes. Similarly when you receive and issue goods, the stock value increases and decreases based on the transaction posted.

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A simple method of calculating the stock value is to multiply the available stock quantity with the material price.

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In SAP, SAP, material valuation is controlled by two factors: - System Settings -Material Master Records In this section, you will see the different system system settings for material valuation and settings in material master. master.

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In the SAP system you can valuate material at company code level, level, or at plant level.

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You can define the area of valuation in customizing. Once set, it is not possible to switch the valuation level from plant to company code, or vice versa.

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If you select the valuation area as company code, the material valuation for all plants in that company code will get updated consistently based on the receipt issue of material in any plant.

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If you select the valuation area as plant, the material valuation for only that plant will get updated in which material movement has taken place.

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Hence before you maintain the accounting data in the material master based on the valuation area, the system asks you to specify either the plant or company code.

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SAP recommends defining material valuation at the plant level.

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SAP MM Basics- Conditions, Valuations and Refer to the text in the next slide. 12/8/2013

Purchase Info Records Portfolio

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A Valuation Class determines which account should get updated during the goods movement.

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For example, if you select the valuation class for material A as 3000 and material B as 3001, the system will update account 300000 for material A and account 300010 for material B.

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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.

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You have to select the valuation class when maintaining the accounting data for a material.

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Based on material type selected at the time of creation of material you can select the valuation class.

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In the material master record, you can determine the price control procedure. You can carry out material valuation by standard price or by moving average price. If you decide to valuate a material by standard price, the stock gets valuated based on the price stored in material master. If you decide to valuate a material by moving average price, the stock gets updated based on the order or invoice price. 12/8/2013


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Refer to the text in the next slide. 12/8/2013


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This figure explains the effect effect of valuation procedure selected in material master record.

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If you select to valuate goods based on moving average average price, when you receive goods against the PO the system updates stock account based on purchase order price.

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If you select to valuate goods based on standard price, when you receive receive goods against the PO the system system updates stock account based on standard price maintained in material master and posts the price difference difference to price difference difference account. In this figure you can see see the material standard standard price is 20 EUR per piece and PO price is 25 euro per piece. The system system has updated stock account with 200 EUR for receipt of 10 pieces and posted 50 EUR difference to price difference account. 12/8/2013


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This slide shows the postings in financial accounting accounting and updates updates in material master records, when you post goods receipt and invoice receipt for standard price material. This slide shows present stock situation for a material in an enterprise.

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During goods receipt, the system updates the stock value and stock quantity as standard price. • It updates the GR/IR clearing account at the purchase order price. • It posts the difference between purchase price SAP MMthe BasicsConditions,order Valuations and and the standard price to 12/8/2013 the price difference account. Purchase Info Records Portfolio

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When the incoming invoice is posted, the GR/IR clearing account ac count is cleared at the order price. • The vendor account is updated at the invoice price. • It posts the difference between the purchase order price and the invoice SAP MM Basics-differences Conditions, Valuations and price to the income from price differ ences account. It does not change the 12/8/2013 Purchase Info Records Portfolio 29 total stock value.

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This slide shows the postings in financial accounting and updates in material master records, when you post goods receipt and invoice receipt for moving average price. This slide shows present stock situation for a material in an enterprise.

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During goods receipt, the system system updates the stock value, stock account, and GR/IR clearing account ac count at the purchase order price. The moving average average price is recalculated recalculated on the basis of the new stock value.

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When the incoming invoice is posted, the GR/IR clearing account is cleared at the order price. The vendor (creditor) account is updated at the invoice price. The system posts the difference between the purchase order price and the invoice price to the stock account. It recalculates the stock value based on the invoice price. The system redetermines the moving average price based on the changed stock value. If the stock quantity in the invoice receipt is less than the invoice quantity, the system posts part of the difference to the expenditure or income from price differences and account instead of the stock account.

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Summary

• We now come to the end of the topic Material Valuation Basics. • You should now be able to explain the significance of the valuation area, the function of the valuation class, and the material valuation procedur p rocedures. es.

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Topic-3, 4, 5 (Basics) Conditions/ Purchase Info Records /Valuations in SAP MM

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