BPI - I - Student Book.pdf

BPI - I Student Book

Business Process Integration - I Student Books

rgThe Rushmore Group, LLC

Version 4.1 July 2007

SAP AG and The Rushmore Group, LLC 2007 1

Business Process Integration I

Presented byThe Rushmore Group, LLC

July 2007 SAP AG and The Rushmore Group, LLC 2007 2

Welcome

Introductions Student Instructor

Course schedule Classroom materials Housekeeping issues


Introductions

Your name

My background [briefly]

Your SAP role/experience/courses attended

Your objectives/expectations with respect to this course...




Course Materials

Business Process Integration Slides Business Process Integration Exercises


Schedule of Exercises

Day One 1 to 20Day Two 21 to 68Day Three 69 to 106Day Four 107 to 151Day Five 152 to 190

An Introduction to the Basics of SAPs R/3

Client / ServerIntegrated Business

Solution




SAP

Systems, Applications, and Products in Data Processing (SAP)

Name of the company SAP AG SAP America

Name of the software SAP R/2 Mainframe version SAP R/3 Client/Server version


SAP AG

Founded in Germany (1972) Worlds third largest software provider Worlds largest provider of Integrated Business

Solutions software Company stock trades on the Frankfurt and New

York exchanges


SAP R/3

World-wide usage Designed to satisfy the information needs for

business sizes (small local to large all international) Multi-lingual Multi-currency

Designed to satisfy the information needs for all industries (industry solutions)




SAP R/3

Enables a company to link its business processes Ties together disparate business functions

(integrated business solution) Helps the organization run smoothly Real-time environment Scalable and flexible


Integrated Business SolutionsSoftware Vendors

SAP Oracle (Peoplesoft and J.D. Edwards) Microsoft Great Plains, Axapta, Solomon IBM BAAN


Architecture

Central relational database (e.g., Oracle, Informix, Microsoft SQL and many others)

Client/Server three-tiered ERP Component Oriented towards common

identifiable business modules (FI, MM, SD, CO, PP, HR)

Add-ons: Customer Relationship Mgmt (CRM) Supply Chain Mgmt (SCM)

Product Lifecycle Mgmt (PLM)




Relational Database

Tables: Defines and links thousands of tables of information (25,000+)

Advantages Consistent and accurate data Common definitions for terms Shared, but restricted usage (e.g., profiles) Eliminates data redundancy


Client/Server Environment

Client Software/hardware combination that can make a

request for services from a central repository of resources

Server Software/hardware combination that can provide

services to a group of clients in a controlled environment


Three-Tier SAP Structure

GUI Graphical User Interface or Web Interface

Application server (one or many) Database server (one single location)




SAP Enterprise System

Database

Application

Presentation

Browser ClientPCs, Laptops, etc.

Network

Application Servers

Database

Internet Transaction

Server

Web Server


mySAP Business Suite

SAP NetWeaver

mySAP SCM

mySAP PLM

mySAP SRM

mySAP CRM

mySAP ERP


R/3

FIFinancial

AccountingCO

Controlling

PSProjectSystemWF

WorkflowISIndustry

Solutions

MMMaterials

Mgmt.

HRHuman

Resources

SDSales and

Distribution

PPProductionPlanning

QMQualityMgmt. PM

Plant Maintenance

SMServiceMgmt.


Solution

ECEnterpriseControlling

AMFixed Assets

Mgmt.

mySAP ERP Modules




Business Modules

Collections of logically related transactions within identifiable business functions MM (Buy) PP (Make) SD (Sell) FI and CO (Track) HR


SAP R/3 Basics

Instance each install of the SAP R/3 software on an individual application server

Configurable each instance can be distinctively configured to fit the needs and desires of the customer (within limits)

Most of the infrastructure decisions, including configuration decisions, occur during project implementation


Configuration

The process of tailoring SAP software by selecting specific functionality from a list of those supported by the software, very much like setting defaults (e.g., Word, Access)

DOES NOT involve changes to the underlying software code




Programming Code Modifications

Changes to the delivered code

ABAP/4 Advanced Business Application Programming (ABAP)

This should be done sparingly and carefully as it can make migration to new versions of the software much more difficult


SAP R/3 Document Principle

Each business transaction that writes data to the database creates a uniquely numbered electronic document

Each document contains information such as Responsible person Date and time of the transaction Commercial content

Once created, a document can not be deleted from the database


Review

SAP and SAP R/3 Integrated Business Solution Architecture Client/Server Software Relational Database SAP R/3 Modules Configurable Software Programming Code Modifications Be Careful!! SAP R/3 Document Principle



Unit 1

Business Processes,Integration, and

Configuration in the SAP R/3 Environment

Unit 1


Two Differing Learning Approaches

Standard SAP training Level 1: Introductory Level 2: Business processes Level 3: Configuration

Our Approach Cross functional Understand business processes and their

relationships to SAP's organizational structure Highlight integration/configuration!!


Learning by Creating a Model Business

Understanding business processes and their integrative nature

Understanding SAP organizational structures Combining business processes and SAP

organizational structure (i.e., configuration) Test the newly configured system View system outputs - statistics, reports, and

graphics




Pen Incorporated

Start-up company in the promotional pen business

Initially buys and re-sells different lines of promotion pens

Sells to both wholesale and retail procure and distribute

Later acquires a production facility to manufacture its own product produce and distribute

SAP R/3 andBusiness Processes

- Overview -


Pen Incorporated Procure for Sales Order

Pre-Sales Activity

Sales Order Delivery Billing

General Ledger

Accounts

Purchase Requisition

Purchase Order

Goods Receipt

In Inventory

Plant or Warehouse

Invoice Receipt

Availability Check

NO

YES

Goods to Delivery

Goods from Purchase Order

InventoryPostings

AccountsReceivable

AccountsPayable




Pen Incorporated Produce for Sales Order

Pre-Sales Activity

Sales Order Delivery Billing

Planned Order

Production Order

Completion Confirmation

In Inventory

Plant or Warehouse

Availability Check

NO

YES

Goods Issued to Delivery

Goods from Production Order

General Ledger

Accounts

InventoryPostings

AccountsReceivable

AccountsPayable

Issue Goods to Production

Order


R/3

FIFinancial

AccountingCO

Controlling

PSProjectSystemWF

WorkflowISIndustry

Solutions

MMMaterials

Mgmt.

HRHuman

Resources

SDSales and

Distribution


QMQualityMgmt. PM

Plant Maintenance

SMServiceMgmt.


Solution


AMFixed Assets

Mgmt.



Logistics

Materials Management (MM)

Sales and Distribution (SD)

Production Planning (PP)

Quality Management (QM)

Plant Maintenance (PM)

Service Management (SM)




Accounting and Finance

Financial Accounting (FI) Controlling (CO) Enterprise Controlling (EC) Fixed Asset Management (AM) Project Systems (PS)


Human Resources

Human Resources (HR)


R/3

FIFinancial

AccountingCO

Controlling

PSProjectSystemWF

WorkflowISIndustry

Solutions

MMMaterials

Mgmt.

HRHuman

Resources

SDSales and

Distribution


QMQualityMgmt. PM

Plant Maintenance

SMServiceMgmt.


Solution


AMFixed Assets

Mgmt.





Components of Materials Management

MaterialsManagement

(MM)

LogisticsInvoice

Verification

MaterialMaster

PhysicalInventory

Valuation

MRP

ServiceEntrySheet

ServiceMaster

ProductCatalogPurchasing

InventoryMgmt.

ForeignTrade/

Customs


IntegrationProcurement Process(Procure-to-Pay)

PurchaseRequisition

Paymentto Vendor

Notify Vendor

VendorShipment

InvoiceReceipt Goods

Receipt

Purchase Order


R/3

FIFinancial

AccountingCO

Controlling

PSProjectSystemWF

WorkflowISIndustry

Solutions

MMMaterials

Mgmt.

HRHuman

Resources

SDSales and

Distribution


QMQualityMgmt. PM

Plant Maintenance

SMServiceMgmt.


Solution


AMFixed Assets

Mgmt.





Components of Sales and Distribution

Sales andDistribution

(SD)

SalesSupport

Sales

CreditMgmt.

ShippingTransport

Billing

ForeignTrade

SalesInformation

SystemMasterData


Sales Order Process(Order-to-Cash)

Integration

Sales OrderEntry

Post GoodsIssue

Invoice Customer

PickMaterials

Receipt ofCustomer Payment

Pack Materials

CheckAvailability


R/3

FIFinancial

AccountingCO

Controlling

PSProjectSystemWF

WorkflowISIndustry

Solutions

MMMaterials

Mgmt.

HRHuman

Resources

SDSales and

Distribution


QMQualityMgmt. PM

Plant Maintenance

SMServiceMgmt.


Solution


AMFixed Assets

Mgmt.

Financial Accounting (FI)




Components of Financial Accounting

Financial Accounting

(FI)

AccountsReceivable

AccountsPayable

SpecialPurposeLedger

FixedAssets

Banks

GeneralLedger


IntegrationProcurement Process(Procure-to-Pay)

PurchaseRequisition

Paymentto Vendor

Notify Vendor

VendorShipment


Receipt

Purchase Order



Integration

Sales OrderEntry

Post GoodsIssue

Invoice Customer

PickMaterials


Pack Materials

CheckAvailability



SAP R/3 Configuration

- Overview -



R/3

FIFinancial

AccountingCO

Controlling

PSProjectSystemWF

WorkflowISIndustry

Solutions

MMMaterials

Mgmt.

HRHuman

Resources

SDSales and

Distribution


QMQualityMgmt. PM

Plant Maintenance

SMServiceMgmt.


Solution


AMFixed Assets

Mgmt.


Business Process Integration

The Stool Components

Organizational Data Master Data Rules Transactions





FI

MM

SD

Org

Dat

a

Rules

FI

MM

SD

Master D

ata

FI

MM

SD

FI SDMM


Organizational Data

A hierarchy in which the organizational units in an enterprise are arranged according to tasks and functions

Are static data and are rarely changed The definition of organization units is a

fundamental step, it is a critical factor in how the company will be structured


Master Data

Master data is relatively fixed Material master data Vendor master data Purchasing information record General Ledger master data

Before making the master data configurations, you must have completely defined the organizational structures




Rules

Defines the parameters for Master Data and Transactions

Determines functionality for Master Data and Transactions

Relatively fixed Changes as policy changes


Transaction Data

Includes internal and external exchanges that describe business activities

Unlike master data, aggregate transactional data is dynamic each transaction is unique


Functional Areas Where and When

Business Process Integration I Financial Accounting (FI) Materials Management (MM) Sales and Distribution (SD)




Functional Areas Where and When

Business Process Integration II Financial Accounting (FI) Controlling (CO) Materials Management (MM) Production Planning (PP) Quality Management (QM) Sales and Distribution (SD)





The Basics

- Navigation -

Unit 2


Overview

Logging on SAP R/3 screens Basics of data entry Working with multiple sessions Reporting On-line help and system messages Setting user defaults Logging off


SAP R/3 System Standard Features





Logging On - SAP R/3 Initial Screens


Logging On - The Client

This is a numeric field This number defines a

whole business entity


Logging On - User

Enter the name of the SAP user

Users of SAP system are client-specific User identification on

one client will only allow access to that client on that server




Logging On - Password Rules

Letters Numbers Easy to remember 3-8 Characters long No 3 Characters can

be the same Do not start with a ?

or an ! Do not use previous

5 passwords


Logging On - Language

SAP supports multi-national character sets and languages on the same system, at the same time

Default languages are English and German


Logging On - Data Record

Valid ValidClient User Password From To

400 STEVE ******** 1/1/2000 12/21/2000400 BOB ******** 1/1/2000 12/21/2000400 JERRY ******** 1/1/2000 12/21/2000410 STEVE ******** 1/1/2005 12/31/2008410 BOB ******** 1/1/2005 12/31/2008410 JERRY ******** 1/1/2005 12/31/2008

Table




SAP R/3 System - Standard Features

Logging On SAP R/3 Screens Basics of Data Entry Working with Multiple Sessions Reporting On-line Help and System Messages Setting User Defaults Logging Off


SAP R/3 Screens - The Topics

Easy Access desktop System menus System navigation Transaction name Transaction icons Transaction work area Status messages


SAP R/3 Screens - Easy Access Desktop

System Menus

TransactionName

TransactionIcons

TransactionWork Area

Status Messages

System Navigation




SAP R/3 Screens - Easy Access Desktop

Favorites

Folder andSub-Folder

Transactions


SAP R/3 Screens - System Menus


SAP R/3 Screens - System Navigation

Ente

r

Opt

ions

Com

man

d Fi

eld

Save

Back Exit

Can

cel

Prin

tFi

nd/E

xpan

d ic

ons

Scro

ll ic

ons

Cre

ate

a ne

w s

essi

onC

reat

e a

desk

top

shor

tcut

Hel

p ic

on




SAP R/3 Screens - Transaction Name


SAP R/3 Screens - Transaction Name


SAP R/3 Screens - Transaction Icons

Screen or view dependant (e.g. materials master will differ from sales order

entry will differ from the main menu)




SAP R/3 Screens Transaction Work Area


SAP R/3 Screens Status Messages

System Message

System Information


SAP R/3 Transaction Screen

Tabs Header

Line Item

Line ItemDetail




SAP R/3 Master Data Screen

Tabs





Using menus Using transaction codes System > status Using /n Multiple sessions Using /o

Basics of Data Entry





Types of entry fields Moving between fields Radio buttons and check boxes Possible entry fields Match-codes Saving data Canceling data



Cancel

Check Box

Pull Down

Entry (Input) FieldTab

Save



There are three types of entry fields: Required Default entry Optional entry field







Working with Multiple Sessions

Opens another session


Working with Multiple Sessions

An SAP session is a window in which the user may perform a particular task

Users may have up to six sessions open at one time







Reporting

Three basic steps to running a report Access the report Enter selection criteria Execute the report


Reporting

Access Selection

Execution







On-line Help


On-line Help

Help on screen fields - F1 Extended help Reference information

Technical information

Displaying possible entries - F4 Using the Help menu

Extended help R/3 library Getting started




F1 - Key

F4 - Key

On-line Help


System Messages

E = Error An invalid entry has been made The cursor moves to the field where the

error has occurred W = Warning

A possible error has been made The user can continue without changing

I = Information Feedback from the system







Setting User Defaults





Logging Off

System > logoff Exit button Control box

For security purposes it is important to log off SAP whenever you leave your PC. Your user name is linked with all transactions you perform providing an audit trail.




Sales Order Process

Sales OrderEntry

CheckAvailability

ProcurementProcess

PickMaterials

PurchaseRequisition

Purchase Order

GoodsReceipt

InvoiceReceipt

Paymentto Vendor

Post GoodsIssueInvoice

Customer

Receipt ofPayment

BPI I - Exercise Roadmap

Run MRP

Sales Process ExercisePart 1

Order-to-Cash


R/3

FIFinancial

AccountingCO

Controlling

PSProjectSystemWF

WorkflowISIndustry

Solutions

MMMaterials

Mgmt.

HRHuman

Resources

SDSales and

Distribution


QMQualityMgmt. PM

Plant Maintenance

SMServiceMgmt.


Solution


AMFixed Assets

Mgmt.






Sales OrderEntry

Post GoodsIssue

Invoice Customer

PickMaterials


Pack Materials

CheckAvailability


1. Logging on the SAP System2. Create Vendor Master3. Create Material Master4. Create Customer Master5. Create Customer Quotation6. Create Sales Order with Reference to Customer

Quotation7. Check Stock Status

Unit 2, Group 1 Exercises

Procurement Process Exercise

Procure-To-Pay




R/3

FIFinancial

AccountingCO

Controlling

PSProjectSystemWF

WorkflowISIndustry

Solutions

MMMaterials

Mgmt.

HRHuman

Resources

SDSales and

Distribution


QMQualityMgmt. PM

Plant Maintenance

SMServiceMgmt.


Solution


AMFixed Assets

Mgmt.



Procurement Process(Procure-to-Pay)

PurchaseRequisition

Paymentto Vendor

Notify Vendor

VendorShipment


Receipt

Purchase Order

3-WayMatch


8. Run Materials Requirement Planning Single Item, Single Level

9. Convert Purchase Requisition to Purchase Order

10. Create Goods Receipt11. Create Invoice Receipt from Vendor12. Post Payment to Vendor




Sales Process ExercisePart 2

Order-to-Cash


R/3

FIFinancial

AccountingCO

Controlling

PSProjectSystemWF

WorkflowISIndustry

Solutions

MMMaterials

Mgmt.

HRHuman

Resources

SDSales and

Distribution


QMQualityMgmt. PM

Plant Maintenance

SMServiceMgmt.


Solution


AMFixed Assets

Mgmt.




Sales OrderEntry

Post GoodsIssue

Invoice Customer

PickMaterials


Pack Materials

CheckAvailability





13. Create Delivery Note for Sales Order14. Check Stock Status15. Pick Materials on Delivery Note16. Post Goods Issue17. Check Stock Status 18. Bill Customer19. Post Receipt of Customer Payment20. Review Document Flow





Financial Accounting(FI)

- Overview -

Unit 3



R/3

FIFinancial

AccountingCO

Controlling

PSProjectSystemWF

WorkflowISIndustry

Solutions

MMMaterials

Mgmt.

HRHuman

Resources

SDSales and

Distribution


QMQualityMgmt. PM

Plant Maintenance

SMServiceMgmt.


Solution


AMFixed Assets

Mgmt.


Unit 3, Part 1 Overview

Financial Accounting (FI) Goals and Objectives Target Audience Components

Managerial Accounting (CO) Goals and Objectives Target Audience Components

Comparisons and Relationships




R/3

FIFinancial

AccountingCO

Controlling

PSProjectSystemWF

WorkflowISIndustry

Solutions

MMMaterials

Mgmt.

HRHuman

Resources

SDSales and

Distribution


QMQualityMgmt. PM

Plant Maintenance

SMServiceMgmt.


Solution


AMFixed Assets

Mgmt.



Goals and Objectives

Financial accounting is designed to collect all of the data needed to support the preparation of financial statements for external users


Target Audience

Internal Executives Senior Management Accounts Administration Staff Employees

External Legal Authorities Banks Auditors Shareholders Insurance Taxing Authorities Media Financial Analysts




Components of Financial Accounting


(FI)

AccountsReceivable

AccountsPayable

SpecialPurposeLedger

FixedAssets

Banks

GeneralLedger


R/3

FIFinancial

AccountingCO

Controlling

PSProjectSystemWF

WorkflowISIndustry

Solutions

MMMaterials

Mgmt.

HRHuman

Resources

SDSales and

Distribution


QMQualityMgmt. PM

Plant Maintenance

SMServiceMgmt.


Solution


AMFixed Assets

Mgmt.

Controlling (CO)


Goals and Objectives

Managerial accounting is designed to collect data for the preparation and analysis of reports for use by internal users




Target Audience

Executives Senior Management Department Managers Controllers Cost Accountants


Components of Managerial Accounting

Controlling(CO)

CostElement

Acct

CostCenterAcct

ProductCost

Controlling

InternalOrders

ActivityBased

CostingProfit

CenterAcct

ProfitabilityAnalysis


Comparison

Managerial Accounting Cost Center Accounting Profit Center Accounting Product Costing Profitability Analysis Different Valuations Flexibility

Financial Accounting External Accounting

Balance Sheet Profit & Loss Statement

Legal Requirements Standards




Comparative Reporting


External Reporting

Managerial Accounting (CO)ProductCostsReports

Internal Reporting

CostCenterReports

ProfitCenterReports

ProfitMargin

RetainedEarningsReport

LiquidityCalculation

Income Statement

BalanceSheet


Income Statement Bal. Sheet


(FI) TransactionDocument

AmountG/L Account #Cost Center1900012432

(CO) Transaction Document

Cost Center Cost Element

20000657 Controlling

100100

BankSupplies Exp.

Cost Center

100

Interrelated and Closely Connected


- The Basics -




Unit 3, Part 2 Overview

General Ledger Chart of Accounts Balance Sheet

Assets Liabilities Equity

Income Statement Revenues Expenses


General Ledger

The General Ledger provides a complete record of all "acceptable" business transactions from the viewpoint of an accountant

An acceptable business transaction has the following traits Affects the financial position of the entity Measurable in a currency Affects at least two accounts Assets = Liabilities + Equity Debits = Credits


Chart of Accounts

The foundation for the General Ledger is the Chart of Accounts

A Chart of Accounts contains a complete list of all of the accounts utilized in the General Ledger for a given company

Financial accounting reports are prepared from the balances contained in the General Ledgers Chart of Accounts




Chart of Accounts (continued)

There are five types of accounts contained in a Chart of Accounts Assets Liabilities Equity Revenues Expenses

There are two primary accounting reports prepared from the General Ledger Chart of Accounts Balance Sheet Income Statement


Balance Sheet Assets

Things of value that a company owns or controls that accountants have agreed to measure in monetary terms.

Examples of these accounts include: Cash Accounts receivables Plant and equipment Inventory


Balance Sheet Liabilities

Things that a company owes or must provide services in order to settle that accountants have agreed to measure in monetary terms.

Examples of these accounts include: Accounts payable Notes payable Bonds payable Unearned revenue




Balance Sheet Equity

Equity is simply the mathematical difference between assets and liabilities.

Includes the monetary amounts collected with respect to all preferred and common stock transactions, the aggregate net income reported since organization of the company, and a reduction for dividends that have been paid to stockholders.


Balance Sheet


Income Statement Revenues

The monetary amounts collected from customers in settlement for goods purchased from our company or services rendered by our firm to them during the current fiscal year.




Income Statement Expenses

The monetary amounts paid to vendors in settlement for goods purchased by our company or services rendered to our firm by other companies during the current fiscal year.


Income Statement


- Organizational Structures -





FI

Org

Dat

a


Organizational Data





Unit 3, Part 3 Org Structures

Organizational Structures Client Company Chart of accounts Company code Credit control area




Client

Highest hierarchical level in an SAP environment

A complete database containing all the tables necessary for creating a fully integrated information system

Master records are created at the client level


Client


Company

Consolidated financial statements are created at the company level

A company can include one or more company codes

All company codes must use the same chart of accounts and fiscal year

Company is not required in the definition of an enterprise (optional)




Client

Company

Organizational Structure


Company Code

A legally independent entity The smallest organizational unit for which

accounting can be carried out Business transactions are processed at this level Accounts are managed at this level Legal financial statements, such as the balance

sheet and the income statement, are generated at this level using the General Ledger balances


Client

Company

CompanyCode





Chart of Accounts

A listing of the accounts (assets, liabilities, equity, revenues, and expenses) that are contained in the General Ledger

A chart of accounts must be assigned to every company code in order to create the General Ledger for that company

Several company codes can use the same chart of accounts


CompanyCode 010

CompanyCode 038

CompanyCode 110

CompanyCode 117

United States Chart of

Accounts

CanadianChart of

Accounts

Chart of Accounts


Client

CompanyChart ofAccounts

CompanyCode





Fiscal Year Variant

Specifies the accounting fiscal year for reporting purposes

Special periods are created to aid in the quarterly or year-end adjusting process completed prior to preparing financial statements

A single fiscal year variant is assigned to each company code


Client

CompanyChart ofAccountsFiscal Year

Variant

CompanyCode



Credit Control Area

An organizational unit or area of responsibility created to control customer credit limits

A company code is assigned to one and only one credit control area

Multiple company codes can be assigned to one credit control area




Client


CompanyCode

Fiscal YearVariant

Credit ControlArea



Client


CompanyCode

Fiscal YearVariant

Credit ControlArea



Consolidation and Business Areas

Company A company is an organizational unit in Financial

Accounting which represents a business organizationaccording to the requirements of commercial law in a particular country.

Business Areas A unit in an enterprise that groups product and market

combinations as homogeneously as possible for the purpose of developing unified business policy.




Client

GeneralMotors

GM Corp.Chart of Accts

GMC CadillacChevrolet

CorporateFiscal Year Var.

GMCorporateCredit CA

Cars Cars

Trucks Trucks Trucks

Business Areas

Consolidation of Company Codes

Optional Organizational Structures


Client 100

Chart ofAccounts

CompanyCode

Fiscal YearVariant

Credit ControlArea

Pen Inc.


Unit 3 Exercises

21. Create Company Code 22. Create Chart of Accounts23. Assign Company Code to Chart of Accounts24. Assign Company Code to Fiscal Year Variant25. Create Credit Control Area26. Assign Company Code to Credit Control Area27. Assign Permitted Credit Control Area to

Company Code



Material Management(MM)

- Organizational Structures -

Unit 4



MM

Org

Dat

a


Organizational Data







R/3

FIFinancial

AccountingCO

Controlling

PSProjectSystemWF

WorkflowISIndustry

Solutions

MMMaterials

Mgmt.

HRHuman

Resources

SDSales and

Distribution


QMQualityMgmt. PM

Plant Maintenance

SMServiceMgmt.


Solution


AMFixed Assets

Mgmt.



Unit 4 Overview

Unit Concept Purchasing and SAP R/3 Procurement Process Organizational Structures Organizational Relationships Warehouse Management


Unit Concept

The purchasing process involves the acquisition of goods and services to support the creation of goods and services in the organization

In this unit the structure required for the purchasing process is presented




Purchasing and SAP R/3

The purchasing process exists in the Materials Management (MM) module of SAP R/3 and Finance (FI) module

The structure includes elements of the Materials Management (MM) and Finance (FI) modules

Master data for the purchasing process exists in the (MM) and (FI) modules

The purchasing process can and does interface with the Production Planning (PP), Warehouse Management (WM), and Quality Management (QM) modules


Components of Materials Management

MaterialsManagement

(MM)

LogisticsInvoice

Verification

MaterialMaster

PhysicalInventory

Valuation

MRP

ServiceEntrySheet

ServiceMaster

ProductCatalogPurchasing

InventoryMgmt.

ForeignTrade/

Customs



PurchaseRequisition

Paymentto Vendor

Notify Vendor

VendorShipment


Receipt

Purchase Order

3-WayMatch




Organizational Structures

Plant Valuation Area Storage Locations Purchasing Organizations Purchasing Groups


Plant

Lowest valuation area Organizational level where Material

Requirements (MRP) runs Generally used to describe a production site, a

distribution center or centralized warehouse May be a physical or logical unit


Valuation Area

The valuation area determines at which level a material is valuated (inventory value is established)

SAP R/3 allows valuation at the company code or plant level, but recommends valuation area be set at the plant level




Storage Location

Subdivision of a plant Where materials are managed (inventory

management) Raw Materials Maintenance, Repair, and Other (MRO) Finished Product

May be a physical or logical unit


Organizational Relationships

Plant/Storage Location

Storage Location20 - Quality

Storage Location10 - Inventory

Plant P001


Purchasing Organization

Organizational unit responsible for the procurement of materials and services.

SAP requires that purchasing organizations be assigned at the plant level

A purchasing organization can be assigned to more than one plant

A purchasing organization can be assigned to a company code




Plant/Purchasing Organization (1)

One plant multiple purchasing organizations

Purchasing Organization P002


Plant P001




Each plant has its own purchasing organization


Plant P002


Plant P001

Organizational Relationships (Continued)



One purchasing organization for multiple plants

Plant P002Plant P001


Organizational Relationships (Continued)




Organizational Relationships(continued)


One purchasing organization for multiple company codes

Company CodeC002

Company CodeC001


Plant P002Plant P001


Purchasing Group

Responsible for specified purchasing activities Often used to identify individual buyers Used for reporting



Purchasing Organization/Purchasing Group

Purchasing Group002

Purchasing Group001







Company CodeC001

Storage Location20 - Quality

Storage Location10 - Inventory

Plant P001

Purchasing Group001


Warehouse Management

Not required for the purchasing functionality of SAP R/3

A separate module in the SAP R/3 environment Many functions and elements can be performed

outside of the module


Warehouse Management Elements

Receiving, identifying and sorting goods Placing goods into storage bins Taking inventory Monitoring and inspecting goods in storage Preplanning distribution of materials Picking and accumulating orders Packaging, loading and shipping goods




Company C001

Plant P001 Plant P002

Storage Loc. 30Storage Loc. 10

Warehouse 1 Warehouse 1

Aisle 1 Aisle 1 Aisle 2Aisle 2 Aisle 3

Rack 1Rack 1 Rack 1

ABC123

Storage Loc. 40Storage Loc. 20

Warehouse Management Relationships

Inventory Management(MM)

Warehouse Management (WM)

Company Code

Plant

Storage Loc.

Warehouse

Aisle

Storage Rack

Quantity


Unit 4 Exercises

28. Verify Valuation Area29. Define Plant (P_ _ _)30. Define Storage Locations for Inventory and

Quality31. Define Purchasing Organization32. Create Purchasing Groups 33. Assign Plant to Company Code34. Assign Purchasing Organization to Company

Code35. Assign Purchasing Organization to Plant36. Setup Parameter ID





- Rules (Internal Controls) -

Unit 5


Rules





Unit 5 Rules

Rules Account groups

BS Balance Sheet Account Group PL Income Statement Account Group RA Reconciliation Account Group

Field status variant Field status groups

Fiscal year variant




Account Groups

Chrt/accts Acct group Description From ToCHRT BS Balance Sheet 100000 399999 CHRT PL Income Sheet 400000 999999CHRT RA Reconciliation 110000 310000


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


Account control Suppress Req. entry Opt. entry Display

CurrencyTax categoryReconciliation account

Account Group BS

Account controlAccount managementDocument entryBank/financial detailsInterest calculationJoint venture

Account Groups




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


Field Status Variant

Fld status groupTextZALL All AccountsZBSA Balance Sheet AccountsZEXP Expense AccountsZGRI Material Management (GR/IR) AccountsZRCN Reconciliation AccountsZREV Revenue Accounts


Field status variant (V000) - Group ZBSA - Balance Sheet Acct.

General dataAdditional account assignmentsMaterials managementPayment transactionsAsset accountingTaxes...

General Data Suppress Req. entry Opt. entry Display

Assignment numberTextInvoice reference

Field Status Variant




So What is a Reconciliation Account?

Postings to sub-ledgers (such as accounts receivable or accounts payable) are automatically concurrently posted to the corresponding reconciliation account in the General Ledger

In this way, the General Ledger is automatically updated and remains in balance with the customer and vendor individual account totals


Unit 5 Exercises

37. Create Account Groups38. Define Retained Earnings Account39. Review Field Status Variant 40. Assign Company Code to Field

Status Variant





- Master Data -

Unit 6



Master D

ata

FI


Master Data

Master data is relatively fixed Material master data Vendor master data Purchasing information record General Ledger master data





R/3

FIFinancial

AccountingCO

Controlling

PSProjectSystemWF

WorkflowISIndustry

Solutions

MMMaterials

Mgmt.

HRHuman

Resources

SDSales and

Distribution


QMQualityMgmt. PM

Plant Maintenance

SMServiceMgmt.


Solution


AMFixed Assets

Mgmt.



Unit 6 Overview

General Ledger Master Data Chart of Accounts Data Company Code Data Reconciliation Accounts

Accounts Receivable Accounts Payable Goods Receipt/Invoice Receipt

General Ledger Account Balances


General Ledger Master Data

A unique master record is created for each General Ledger account

General Ledger accounts are created at the client level

Business transactions are posted to the portfolio of General Ledger accounts made available to a company through the assignment of a specific Chart of Accounts




General Ledger Master Data (continued)

Contains control information for: Data entry Data processing

Specifies the account type: Balance sheet Income statement


General LedgerOrganization of the Data

Contains one or more Chart of Accounts specific information areas

Contains one or more Company Code specific information areas

In this way, a General Ledger master account can be shared by several combinations of Charts of Accounts and Company Codes


100101

CPEN

X

BS

Account numberChart of accounts

Account groupP&L statement acct type Balance sheet account

General LedgerChart of Accounts Data

Account number Name of the Chart of

Accounts Account group provides

information that controls the creation of the master record for a company code




General LedgerCompany Code Data

Local currency Foreign currency Tax category Open item management Line item display Sort key


General LedgerCompany Code Data (continued)

Local currency Specify the currency in which the account is to be

posted Transaction figures are always updated and displayed

in local currency



Foreign currency Specify the alternative currency in which the account

is to be posted It is possible to select up to two alternative currencies Transaction figures will be updated in both the local

and alternative currencies





Tax category Specify the type of tax on purchase and sales (input

or output taxes) that can be posted to the account If the account is not tax relevant, do not make a

specification in this field



Open item management Indicates that the account is subjected to an

affirmative clearing process involving the matching of debits to credits with the purpose of closing each individual line item

For example, reconciliation accounts You can only archive an accounting document if all of

its individual line items have been cleared



Line item display Select if it is desirable to view all the debit and credit

detail for the account Remember that when posting items to such accounts

and displaying line items, additional storage space and system time are required





Line item display should not be used for the following accounts: Reconciliation accounts Accounts that have a summation function and are

analyzed by another application such as revenue or stock accounts

Output and input tax accounts, since tax information is required only in connection with the document



Sort Key Necessary when line item display is selected Determines the data field that will be used to sort the

line items Posting date Document date Cost center



Reconciliation accounts When you post to a sub-ledger, the system

automatically concurrently posts to the corresponding reconciliation account in the general ledger

In this way, the general ledger is automatically updated and remains in balance with the individual account totals




SubsidiaryLedger Accounts

A/R, A/P, GR/IR

General Ledger Reconciliation Accounts

A/R, A/P, GR/IR


Debit Credit

Debit Credit

A/P

Debit Credit

A/R

Debit Credit

GR/IR

$$ $$

$$ $$$$ $$$$ $$

GeneralLedger


Accounts Receivable Reconciliation Account

Accounts ReceivableReconciliation

950

300

Customer 142

150

Customer 123

400

Customer 135

100

Customer 189


Accounts Receivable Integration

FIFinancial

Accounting

FIFinancial

Accounting

FIFinancial

Accounting

FIFinancial

Accounting

MMMaterials

Mgmt.

MMMaterials

Mgmt.

RevenueIncrease to A/R

GoodsIssue

SalesOrder

Income StatementBalance Sheet

FIFinancial

Accounting

FIFinancial

Accounting

CGSDecrease to Inventory

SDSales and

Distribution




Accounts Payable Reconciliation Account

Accounts PayableReconciliation

950

250

Vendor 100435

200

Vendor 100234

100

Vendor 100621

300

Vendor 100846


Accounts Payable Integration

MMMaterials

Mgmt.

MMMaterials

Mgmt.

FIFinancial

Accounting

FIFinancial

Accounting

FIFinancial

Accounting

FIFinancial

Accounting

Increase to A/PDecrease to GR/IR

GoodsReceipt

Balance Sheet

FIFinancial

Accounting

FIFinancial

Accounting

Increase to InventoryIncrease to GR/IR

InvoiceReceipt

MMMaterials

Mgmt.

MMMaterials

Mgmt.


Line Item Display

Account number 100999 Bank AccountCompany code C999

Period Debit Credit DC bal. BalanceC/f bal. 750,000.00

Period 1 5,250.00 3,540.00 1,710.00 751,710.00Period 2 25,000.00 15,000.00 10,000.00 761,710.00

Period 1Doc. no. DT Doc.date Currency Amount1500000013 KZ 01/05/04 USD 1,800.00 -1500000014 KZ 01/06/04 USD 990.00 -100000012 SA 01/08/04 USD 750.00 1400000342 DZ 01/14/04 USD 5,250.00





41. Create Bank Account42. Create Accounts Receivable Reconciliation

Account43. Create Trading Goods Inventory Account44. Create Operating Supplies Inventory Account45. Create Accounts Payable Reconciliation Account 46. Create Goods Receipt / Invoice Receipt

Reconciliation Account47. Create Output Tax Account48. Create Input Tax Account49. Create Retained Earnings Account50. Create Common Stock Account


51. Create Trading Goods Consumption Expense Account

52. Create Operating Supplies Expense Account53. Create Utilities Expense Account54. Create Purchase Price Difference Expense

Account55. Create Information Technology Expense Account56. Create Miscellaneous Expense Account57. Create Cost of Goods Sold58. Run General Ledger List of Accounts Report





Unit 7Materials Management

(MM)

- Master Data and Rules -



Rules

MM

Master D

ata

MM


Master Data

Master data is relatively fixed Material master data Vendor master data Purchasing information record

General Ledger master data





R/3

FIFinancial

AccountingCO

Controlling

PSProjectSystemWF

WorkflowISIndustry

Solutions

MMMaterials Mgmt.

HRHuman

Resources

SDSales and

Distribution


QMQualityMgmt. PM

Plant Maintenance

SMServiceMgmt.


Solution


AMFixed Assets

Mgmt.R/3

FIFinancial

AccountingCO

Controlling

PSProjectSystemWF

WorkflowISIndustrySolution

s

MMMaterials

Mgmt.

HRHuman

Resources

SDSales and

Distribution


QMQualityMgmt. PM

Plant Maintenance

SMServiceMgmt.


Solution


AMFixed Assets

Mgmt.



Unit 7, Part 1 Overview (Master Data)

Unit Concept Procure-to-Pay Process Vendor Master Data Purchasing Information Record


Unit Concept

The purchasing process involves the acquisition of goods and services to support the creation of goods and services in the organization

Master data and rules required for the purchasing process is presented





PurchaseRequisition

Paymentto Vendor

Notify Vendor

VendorShipment


Receipt

Purchase Order

3-WayMatch


Master Data General

Business rules and supportive information are stored in master data records

Each master data record is unique in name or number

Internal or external number ranges are possible Usually created or converted (legacy system) in

the beginning Maintained by numerous organizations


Master Data General (continued)

Vendor master records are maintained by both accounts payable (A/P) and purchasing

Material master records are maintained by purchasing, sales, production, accounting, etc.

Purchasing information records are maintained primarily by purchasing




Vendor MasterOrganization of the Data

General D

ata:

Address

PurchasingData

Vendor 10001

General Data

Company Code DataFinancial Accounting (FI)

Purchasing Organization Data (MM)


Vendor Master Data

A master record must be created for every vendor

General data, Company Code data (Financial Accounting - FI), and Purchasing Org data (Material Management - MM)

Purch. org dataPurchasing dataPartner functions

Company code dataAccount management

Payment transactions

General dataAddressControl dataPaymenttransactions


Vendor Master

Includes all data necessary for processing business transactions and corresponding with vendors

Information is shared between the accounting and purchasing departments




Vendor Master Typical Screens

Address Control Payment Transactions Accounting Information Correspondence Purchasing Data Partner Functions


General Data Address

AddressVendor NameSearch TermStreet addressCity, Region Postal codeCountry

CommunicationLanguageTelephone, Fax, E-Mail

Vendor Master General Data Address


Vendor Master General Data Control Data

Account Control Customer Authorization Trading partner Group key

Tax Information Tax codes Fiscal address Country code City code

Reference Data / Area International locator number Industry Transport zone




Vendor Master General Data Payment Transactions

Bank Details Bank Key Bank Account Account Holder Partner Bank Type

Payment Transactions Alternative Payee Instruction Key


Vendor Master Company Code Accounting Information

Accounting Information Reconciliation Account Sort Key Release Group

Interest Calculation Interest Calculation Indication Interest Calculation Frequency

Withholding Tax Withholding Tax Code Exemption Number


Vendor Master Company Code Payment Transactions

Payment Data Payment Terms Tolerance Group Check Double Invoice Check Cashing Time

Automatic Payment Transactions Payment Methods Alternate Payee Payment Block

Invoice Verification Tolerance Group




Vendor Master Company Code Correspondence Accounting

Dunning Data Dunning Procedure Dunning Block Dunning Recipient Date of Legal Dunning Procedure

Correspondence Local Processing Accounting Clerk Account With Vendor


Vendor Master Purch. Org. Data Purchasing Data

Conditions Order Currency Terms of Payment Incoterms Minimum Order Value

Sales Data Salesperson

Control Data Acknowledgement

Required Returns to Vendor Automatic Purchase

Order Default Data Material

Purchasing Group Planned Delivery Time


Vendor Master Purch. Org. Data Partner Functions

Partner Functions Partner Function Partner Name




Vendor Master Purch. Org. Data Account Group

Vendor masters are assigned to a vendor account group

Through field status maintenance, vendor account groups can be setup for one-time vendors, regional vendors, and internal vendors

The vendor account group controls both type and number range assignment for vendors


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 infos, historic data, statistics, texts

Choice of automatic or manual updating


Source List

The source list 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)





59. Vendor Account Groups60. Create Vendor Master Accounting Record61. Create Vendor Master Purchasing Record62. Create Vendor Master Record Centrally63. Create Vendor Master Record Centrally64. Create Vendor Master Record Centrally


Unit 7, Part 2 Overview (Rules)

Fiscal Period Plant Parameters MRP


Rules







Fiscal Period

In order to execute any material postings, the current fiscal period has to be activated

By initializing the company code for material management, the first major integration between Financial Accounting (FI) and Logistics is completed


Plant Parameters

Material Requirements Planning (MRP) controllers Individuals responsible for running and maintaining

Material Requirements Planning data and reports Negative stock allowance

If a material is allowed to go negative for inventory stock


Plant Parameters (continued)

Purchasing Special purchasing rules External purchasing only settings

Planned orders Rescheduling Conversion to purchase requisitions




Plant Parameters (continued)

Document number ranges Planned orders Purchase requisitions Material Requirements Planning (MRP) lists Reservations


Material Requirements Planning

Detailed planning level Primary Functions

Monitor inventory stocks Determine material needs

Quantity Timing

Generate purchase or production orders


Materials Requirements Planning(continued)

Integrates Production Planning (PP) module with the Materials Management (MM) module

Prerequisites for Materials Requirement Planning (MRP) Activate Material Requirements Planning (MRP) for a

plant Material Master created

Material Requirements Planning view Material Requirements Planning type




Material Requirements PlanningBasic Process

Exploding the Bill of Material (if using production)

Netting Out Inventory Lot Sizing Time-phasing requirements


Material Requirements PlanningNet Requirements

Material Requirements Planning (MRP) calculates the quantity of material needed, if any, based on Sales Orders Material Reservations Repair Parts Inventory Purchase Orders Etc


If adequate inventory is not available to meet Material Requirements Planning (MRP) needs then the system generates Planned Production Orders Planned Purchase Orders

Material Requirements PlanningNet Requirements (continued)




Material Requirements PlanningLot Sizing

Static Based on fixed values in the Material Master

Periodic Groups net requirements together from multiple

periods Optimum

Calculates the optimum lot size for a several periods of net requirements



65. Initialize Fiscal Period for Company Code 66. Display Material Groups67. Maintain Plant Parameters for Material

Management68. Activate Materials Requirements Planning


Unit 7, Part 3Overview (Material Master)

Industry Sector Material Type Maintenance Features Organizational Levels Primary Views




Material Master Industry Sector

Records are grouped according to industry sector and material type

Determines the industry specific data that will appear on the master record


Material Master Material Type

Material types group materials with the same attributes

Material type information determines: What views are maintained Whether internal or external procurement is allowed If changes in material quantity are updated Which general ledger accounts are updated


Material Master Material Types

Standard material types are used in all industries. ROH: Raw Materials

Purchased externally only No sales view

HAWA: Trading Goods Always purchased externally Sold without any change to the material No manufacturing views exist




Material Master Material Types (continued)

FERT: Finished Products Are produced internally Normally no purchasing views exist


Material MasterAdditional Material Types

HIBE: Operating Supplies VERP: Customer returnable packaging LEER: Empty containers KMAT: Configurable material ERSA: Spare parts DIEN: Services


Material MasterAdditional Material Types (continued)

NLAG: Non-stock, non-valuated material UNBW: Non-valuated, stocked material FHMI: Production resources/tools WETT: Competitive products PROD: Product group IBAU: Maintenance assembly

(Plant Maintenance)




Material Master Maintenance

Defaults - speeds entry of data by using the most frequently used field values (plant, purchasing organization, etc.)

Reference Material - speeds entry of data by copying data from existing material master

Profiles - speeds entry of data by copying standard data created in a profile into a selected view Materials Requirements Planning (MRP)

Collective entry of storage location data - speeds creation of multiple storage locations


Material Master Data

Material master data can be related to all organizational levels

General information of a material (description, number, base unit of measure) Has to be related to the highest level of organization -

the client


Material Master Levels

Client Description Units of measure Material number Engineering data

Plant Planning data Manufacturing data Purchasing data




Material Master Levels (continued)

Storage Location Stock quantities


Material Master Views

Basic data 1, 2 Classification Sales: sales organization data 1, 2 Sales: general/plant data Sales text Purchasing Purchase order text Forecasting


Material Master Views (continued)

MRP 1, 2, 3, 4 Work scheduling Storage Warehouse management Quality management Accounting 1, 2 Costing 1, 2




Material Master Material Management

Basic Data Purchasing MRP 1,2,3 General Plant

Data/Storage Accounting 1

Purchasin

g

View MRP 1View

Barrel Pen


Material Master Basic Data

General data Basic Unit of Measure

Unit of measure in which stocks of the material are managed Material Group

Key that you use to group together several materials or services with the same attributes

Division Used to determine the sales area and the business area for a

material, product, or service


Material Master Basic Data (continued)

Dimensions/EANs Gross weight

Used to check storage capacity in warehouse Net weight

Weight excluding packaging and extras this is needed for sales and distribution

Weight Unit Unit of Measure for weight

Volume The space that the material occupies per unit of volume




Material Master Purchasing View

General Data Order Unit

The unit of measure in which a company purchases the product

Purchasing Group Key for a buyer or a group of buyers, who is/are responsible

for certain purchasing activities. Purchasing Values

Purchasing Value Key Define the reminder days and tolerance limits for purchasing


Material Master Plant Data/Storage 1

General Data Container Requirements

Define the regulations that govern which type of container the material must be stored and shipped in

Storage Conditions Defines the conditions on how a material must be stored or

warehoused Shelf Life Data

Minimum remaining shelf life Minimum time the material must keep upon goods receipt

for the goods receipt to be accepted by the system Total Shelf Life

Period of time the material will keep in total, from the date of production or receipt to the shelf life expiration date

July 2

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