4.4.1
Purposeo Material tracking with value or qty tracking is effectively achieved.
o Identification of Physical location of material stocks within location or across locations by online is possible.
o Stocks status of the materials like under quality, blocked, In transit, unrestricted can be easily tracked.
o Special stocks like material with sub-contractor, Returnable vendor packing are tracked online.
4.4.2
Master Data Material master .
4.4.3
Features with respect to Janki Corp Ltd. Transparency of stocks available, through common database, across locations.
Planning will be effective considering expected receipts, expected issues &
online correct stocks. Stock transfer activities are planned. Quantity and Value updating on receipts/ issues is done.
Forecast receipt can be planned due to availability of expected receipt online in the system.
Reduction in inventory holding cost.
Availability checks on goods issue and stock transfers.
Updating of consumption accounts and Inventory accounts online.
Excise related data online with inventory management transactions will be updated.
Material is procured from external or internal sources on the basis of the requirements determined by Material Requirements Planning. The delivery is entered in Inventory Management as a goods receipt. The material is stored (and managed under Inventory Management) until it is delivered to customers (Sales & Distribution), or is used for internal purposes (for example, for production).
During all transactions, Inventory Management accesses both master data (such as material master data) and transaction data (such as purchasing documents) shared by all Logistics components.
It involves
Management of material stocks on a quantity and value basis
Planning, Entry, and Documentation of all Goods Movements
All transactions that bring about a change in stock are entered in real time, and the stocks are updated as a result of these changes. You can obtain an overview of the current stock situation of any given material at any time. This, for example, applies to stocks that:
Are located in the Warehouse
Have already been ordered, but have not yet been received
Are located in the Warehouse, but have already been reserved for production or a customer
Are in quality inspection and in blocked stock type.
If a further subdivision by lots is required for a material, one batch per lot is possible. These batches are then managed individually in the stock.
Inventory Management can manage various types of a company’s own special stocks and externally owned special stocks separately from standard stock.
The stocks are managed not only on a quantity basis but also by value. The system automatically updates the following data each time there is a goods movement:
Quantity and value for Inventory Management
Account assignment for cost accounting
G/L accounts for financial accounting via automatic account assignment
The valuation area is the organizational level at which a material's stock value is managed.
The valuation area can be plant level or company code level.
In Inventory Management, work is basically done at plant and storage location levels. When you enter a goods movement, you only have to enter the plant and the storage location of the goods. The system derives the company code from the plant via the valuation area.
When Good receipt for the purchase order is done system automatically updates stock quantities & values including P&F, Freight, Delivery charges, incidental charges mentioned in the PO. For PO’s having account assignment cost will be debited to relevant G/L account indicated in PO.
Goods movements include both "external" movements (goods receipts from external procurement, goods issues for sales orders) and "internal" movements (goods receipts from production, withdrawals of material for internal purposes, stock transfers, and transfer postings).
For each goods movement a document is created which is used by the system to update quantities and values and serves as proof of goods movements.
Inventory management basically involves:
Goods receipt
A goods receipt (GR) is a goods movement with which the receipt of goods from a vendor or from production is posted. A goods receipt leads to an increase in Warehouse stock.
The System distinguishes between the following types of goods receipts:
1. Goods receipts with reference to an order 2. Other goods receipts
Goods receipts
Goods receipts for Purchase Orders, goods receipts for production orders, subsequent adjustment of subcontract orders, initial entry of stock balances in to SAP, vendor returns and customer returns all will be treated as Goods receipt in SAP.
Material documents are generated when there is a goods movement registered in the system. Numbering of these documents are based on the transaction / event types of the transaction. Numbering is defined for a fiscal year and internal numbering has been defined for a material document.
When Goods Movement transaction is run, the system displays an additional tab at header level for the excise invoice header information, and one tab at item level for the excise invoice line item information. Fill the data as required.
When save the goods receipt or goods issue, the system also saves the excise invoice (either captured/created or posted). It creates all appropriate excise register entries, material documents, and accounting documents
Goods receipt for purchase order process as follows:
1) Choose Goods movement ® Goods receipt ® For purchase order ® PO number known or PO number unknown.
2) Enter the data on the initial screen:
a. Enter the header data.
b. Select the movement type.
3) If the quantity delivered is intended for the warehouse or for consumption/usage, select Movement type ® PO to warehouse (Movement type 101 ).
a. Enter the purchase order number. In addition, we can enter the plant and a purchase order item, in order to restrict selection of the purchase order items.
4) If you selected PO number not known, you can specify search criteria for the purchase orders on the initial screen. The system then displays a list of purchase orders. Select and copy the required purchase order items.
5) The item selection list is displayed. This list contains all of the purchase order items that satisfy the criteria entered.
6) Select the purchase order items to be copied. If necessary, you can change data in the selected items on this screen.
7) Copy (adopt) the selected items.
8) Post the document.
Excise capturing process during goods receipt as follows:
1. In the top line, enter the purchase order number and choose.
2. Enter header data as required, following the standard procedure.
In addition, on the Excise Invoice tab:
a. Set the excise action to Capture Excise Invoice or Capture & Post Excise Invoice.
b. Enter the official excise invoice number and the excise invoice date.
4. Enter line item data as required, again, following the standard procedure.
In addition, on the Excise Item tab, change the data so that it matches the vendor's excise invoice, if necessary.
5. Save the goods receipt.
We can also enter a freight supplier if the condition type for delivery costs allows to do.
FSBP Link:
S.No. Major Process Sub Process Minor Process FSBP Document
1 Procurement GRN & Reversal
J CL_FSBP_MM_GRN_
0011_1.0.doc
Goods issue
A goods issue (GI) is a goods movement with which a material withdrawal or material issue, a material consumption, or a shipment of goods to a customer is posted. A goods issue leads to a reduction in Warehouse stock.
The Inventory Management system supports the following types of goods issues:
1. Issues to Plant for Consumption
2. Issues to Agencies on chargeable basis 3. Issues to Agencies on Returnable basis
4. Issues to Employees/departments on Returnable basis like Tools 5. Issue of LPG/Oxygen Cylinders
6. Scrapping and withdrawal of material for sampling 7. Return deliveries to vendors
FSBP Link:
S.No. Major Process Sub Process Minor Process FSBP Document
1 Goods Issue Goods Issue
J CL_FSBP_MM_GIS_
0012_1.0.doc
Stock transfer
A stock transfer is the removal of material from one storage location and its transfer to another storage location. Stock transfers can occur either within the same plant or between two plants.
There are two methods of stock transfer.
One-Step Procedure:
During a one-step stock transfer, the system creates issue of stock at sender plant &
receipt of stocks at receiver plant with in the same step.
Two-Step Procedure:
During two step process, system transfers material from issuing plant to stock in transit. At receiver plant after receipt document is posted stock in transit gets transferred to receiver plant.
FSBP Link:
S.No. Major Process Sub Process Minor Process FSBP Document 1 Procurement Stock Transport Order
J CL_FSBP_MM_STO_
0014_1.0.doc
Transfer posting
A transfer posting is a general term for stock transfers and changes in stock type or stock category of a material. It is irrelevant whether the posting occurs in conjunction with a physical movement or not.
Transfer posting process as follow:
1) Select Goods movement - Transfer posting.
2) Enter the data on the initial screen:
3) Enter the header data.
4) Select the movement type Transfer posting Stock to stock or Reverse tfr. posting -Stock to stock plus the required stock types.
5) Maintain the data on the collective entry screen:
6) Only enter a receiving storage location if the material should be stored in another storage location.
7) Enter the items.
8) Check the data on the overview screen and post the document All the transfer postings will be done in one step in Janki Corp Ltd.
Reservations
With this component, a request to the Warehouse to keep materials ready for withdrawal at a later date and for a certain purpose can be made.
A reservation for goods issue can be requested by various departments for various account assignment objects (such as cost centre, order, asset, etc.).
The purpose of a reservation is to ensure that a material will be available when it is needed.
It also serves to simplify and accelerate the goods issue process and prepare the tasks at the point of goods issue. It is also important that Material Requirements Planning (MRP) takes reservations into account. It means that required materials are procured in time if they are out of stock.
In SAP the user department specifying where the material is required, what quantity is required, and when it is required can create a Reservation. While running the material planning, based on the Reservation, the system will generate a Purchase requisition automatically, if there is no enough stock on the required day. Reservations do not block the stock from being issued to any other requirement.
In SAP standard movement types are defined to differentiate between the various types of goods movement described above. The following is the list of some of the commonly used movement types that will be used in Janki Corp Ltd.
Movement type Description Remarks
101 GR goods receipt for Purchase
Order (B) & Order (F) A purchase Order reference is required
102 Reversal / Cancellation of GR for
Purchase Order (B) & Order (F) 122 / 123 Return delivery to supplier or to
production You can use this movement type to differentiate between cancellations and return
201 /202 Goods Issue for a Cost centre
261 / 262 Goods issue to an order This refers to issue to all orders
309 /310 Transfer Posting from material to
material This will be used when transfer of
stock from one valuation to another valuation type is required.
311 /312 Transfer Posting from Storage
location to storage location 351 / 352 Transfer Posting – Plant to Plant
(MM Route)
451/452 Returns from Customer(without
shipping) This is used when returns are posted without reference to a return delivery.
501 / 502 Goods Receipt for Others
541 Transfer Posting unrestricted use
stock to Stock of material provided to Subcontractor
542 Reversal of Transfer Posting
unrestricted use stock to Stock of material provided to Subcontractor
543 / 544 Consumption of Materials at Subcontractor Stock
551/552 Scrapping from Unrestricted
stock
561/562 Initial entry of stock balances This movement type will be used to migrate the opening stock balance into SAP; there is a provision to enter the value of the goods movement.
701 phys.inv Used in Physical inventory
postings
702 phys.inv Used in Physical inventory
postings