SAP has dominated the world of ERP market and is being used in every other small or major organization. Success of SAP is attributed to its adherence to GMP good manufacturing practice and best business practice in every industry sector. SAP has standardized business and finance process and their integration worldwide due to its dominance. Chapters are as given below:- 1.

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SAP has dominated the world of ERP market and is being used in every other small or major organization. Success of SAP is attributed to its adherence to GMP good manufacturing practice and best business practice in every industry sector.

SAP has standardized business and finance process and their integration worldwide due to its dominance. It also covers scope of this book and coverage of SAP features in this title. In the Second chapter, business process in procurement, organization structure, and creation of purchase order is explained in detail from the system perspective. Purchase orders for stock item, non-stock item and for service, have been explained.

Master data, which is required before creation of any purchase order, like material master, and vendor master, is also discussed conceptually and from system point of view. This chapter also addresses the purchasing master data i. Special procurement processes like subcontracting, purchase order creation, etc. Return purchase order has also been discussed. Lastly, release strategy procedure for purchase order has also been discussed conceptually and from system point of view.

In the Third chapter, inventory management, valuation and physical inventory processes have been discussed. Inventory management processes like goods receipt, goods issue, stock transfer, transfer posting, reservations, Subcontracting processes, which includes goods movement like issue of raw material to subcontracting vendor from own stock as well as from material supplier and receiving finished goods from subcontracting vendor, has been discussed from BOM creation to goods receipt, step by step.

Special forms of inventory management like split-valuation and non-valuated material has been discussed from business need, accounting need, concept, and system point of view. Ad-hoc physical inventory process and cycle counting process has been discussed.

A very strong use of SAP is its reporting power using transactional data, collected through various inventory transactions. Need of report from purchase, inventory and accounting point of view has been explained. Various transaction codes are also mentioned for reporting. Chapter four addresses most important and critical feature of SAP i. This chapter is divided in three parts, automatic account determination AAA , pricing procedure and tax procedure.

Automatic account determination is an automatic process of determining general ledger account during goods movement that involves accounting. AAA leads to automatic debit and credit entry in respective general ledger accounts. Pricing procedure and tax procedure are integrated with purchase order, goods receipt and vendor invoice verification. During the creation of purchase order, purchaser specifies the basic price of material, any discount, or surcharge, delivery cost like freight, custom duty etc.

From pricing procedure and tax procedure theses values flow to respective general ledger accounts, this helps accounts in vendor liability reconciliation and filing tax returns. Sometimes input sales tax is available for credit against the output sales tax. This is also accomplished through tax procedure. Chapter five is about vendor invoice verification. This is the third and the last step in the procurement process.

After this step payment process to vendor goes to finance process. During LIV vendor is credited and clearing account is debited which was credited during GR goods receipt. There are various types of invoices like material invoice from material supplier vendor, freight invoices from freight vendor, customs invoice from customs house and so on. By the time, accounts receive the invoice; due to market condition, actual price of material of freight might have changed.

The basic price and the delivery cost like freight, which were mentioned in the purchase order, had been negotiated much before. LIV takes care of all the variation in prices and accordingly adjust the inventory value, which was posted during the goods receipt process.

LIV also has the provision of subsequent credit and subsequent debit and credit memos towards the vendor. CIN is integrated with every process of procurement of raw material, capital goods, trading of finished goods etc and inventory transfer between two excise groups. Chapter seven covers various business processes where these duties are applicable and need to be accounted for. Logical and sequential transactional flow and screen shots displaying details of tax treatment has been covered.

Understanding of all the previous chapters is necessary to understand chapter seven and eight. Chapter eight covers implementation guide to configure CIN module. This chapter explains systematic process of configuring materials management module. Configurations of module are lengthy and integrated process.

Every next step is heavily dependent on every previous step. Flow of configuration is as follows: definition and assignment of organization structure, master data configuration, definition of purchase documents, their number ranges, and their controls, creation of pricing procedure and their determination, creation of tax procedure and its determination, output message, inventory management, goods movement type, goods movement screen layout, automatic account determination, incoming invoices, tolerance limit, default tax code, purchase order text control during invoicing etc.

Configuration of the system is always a tricky task and is done after business blueprint phase of the system implementation project. In short, this title on Managing Supply, Sourcing, and Inventory would enrich all - users, management, and consultants. Proudly powered by Weebly.


SAP Materials Management: Over 150 Interview Questions and Answers Included (Second Edition)

Warehouse receives material, store and sort and ships them to next destination. Materials are not supposed to be stored in warehouse for long period. Chapter 2: Warehouse Design, Layout and Configuration: Designing a distribution centre is a complex task, requiring engineers to design storage areas, order picking areas, and material handling systems with the goal of meeting service requirements at minimum cost. Nearly every distribution centre has a unit-load, or pallet, storage area where products are stored before being picked, or before being moved to other order picking areas in the distribution centre.


SAP Materials Management (with CD-ROM)






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