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4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
(Implementation of mySAP ERP and Walvoil by CVS IT Services (I) Pvt. Ltd. for Walvoil Fluid Power (India) Pvt Ltd
yiva
4. Materials Management
Introduction
(GO LIVE on 21st Feb
This Business Blue Print Document describes the following:
Enterprise Structure of Walvoil
Business r Users
Mr. Ivano Chiossi
2006)
Project Sponsor
Mr. Amarnath Ramchandran
Steering Committee
Member, Walvoil
Steering Committee
Member, Walvoil
Project Manager,
CVS IT
Mr.Srinivasa Rao .V
Consultant, CVSIT
Mr. N H Krishnamurthy
Steering Committee
Member, CVS IT
Steering Committee
Member, CVS IT
Project Manager,
Walvoil
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 1 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Introduction
This Business Blue Print Document describes the following:
Suggestions by CVS IT consultants wherever mySAP ERP features are found to be useful to Walvoil business functionality
To-Be Process on mySAP ERP system suggested by CVS IT Consultants
Comments whether the requirement can be realized on the SAP R/3 system or not.
Gaps which are at different stages of exploration
The following codes are given to each module that is within the scope of the agreement:
Module
ID
Module
Financial Accounting
Controlling
Materials Management
Quality Management
Further processes, sub-process and activities in each module are denoted by, say. 1.1, 1.1.1, 1.2.1 etc.
A Business Blueprint document is prepared for each module and reference shall be made wherever required to other modules, whenever
there is an overlap of business processes across modules or a business process requires to be completed in more than one module. The
reference to the business process shall be made using the process numbers as described above;
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 2 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
For e.g.:
As per the above notation, All processes in Sales & Distribution start with 3.* So if a reference has to be made to process in Accounts
Receivable of Financial Accounting, then the reference is made using the notation say, 1.2.* where 1 refers to Financial Accounting and
1.2 refers to Accounts Receivable and then further numbers denote the sub-processes and activities in the module.
Step 1:
The Module Owner shall identify various existing business processes at a broad level and make a list of them as described under section 1
of this document
Step 2:
Depending upon the various business processes thus identified in Step 1, various business scenarios are described in the following way:
As Is Business Processes: The current way of executing the business process shall be explained in detail with data/information flow along
with the IT systems / Manual Systems being used in the whole cycle.
Business Requirement: Under this head, the module owner shall describe the requirements of the company vis--vis this business scenario,
if necessary with examples. Following situations can arise:
The current provisions in the system are sufficient enough and additional configuration efforts are not required.
The current provisions are not sufficient and satisfactory and additional features need to be incorporated in the system
There is no current provision to handle this transaction at all.
The module owner shall identify each business scenario with the above classification.
Step 3:
Based on the Business Requirement, CVS IT consultant shall do a detailed Requirement Analysis and based on the analysis, shall propose
the best fit business process on the SAP R/3 system.
It may not be possible to decide the realization possibility of all Business requirements on the mySAP ERP/CIN4.0A system immediately and
hence the following legend is being followed for describing the statuses:
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 3 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Status Description
A-Possible
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 4 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
1. Definitions:
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 5 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Company Code:
The Company code is smallest organizational unit of external accounting for which a complete, self-contained set of accounts can be
created. This includes the entry of all transactions that must be posted and the creation of all items for legal individual financial statements,
such as the balance sheet and the profit and loss statement.
Walvoil Fluid Power (India) Pvt. Ltd. are mentioned as Company in this document.
Chart of Accounts:
This is a list of all G/L accounts used by one or several company codes.
For each G/L account, the chart of accounts contains the account number, account name, and the information that controls how an account
functions and how a G/L account is created in a company code.
Plant:
A plant is an organizational logistics unit that structures the enterprise from the perspective of production, procurement, plant
maintenance, and materials planning. A plant is manufacturing a facility or branch with in a company.
Purchase Organization:
A purchase Organization is an organizational level that negotiates conditions of purchase with vendors for one or more plants. It is legally
responsible for completing purchase contracts.
Purchasing group: is the key for a buyer or group of buyers responsible for certain purchasing activities.
Storage Location:
A Storage location is a Storage area comprising warehouses in close proximity. Material stocks can be differentiated with in one plant
according to storage location.
Page 6 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
A document that is required at the time of sale of finished goods produced by using the state excisable goods like Rectified Spirit as Raw
Materials.
VAT:
Type of tax introduced by Govt of India, and has been implemented by many states including Karnataka where Walvoil operates from.
State Excise Duty:
As per the provisions of the Karnataka State Excise Act, the company is filing an application to take the approval of State Excise
Department, for using the excisable inputs in the manufacturing activity by remitting the applicable duty on the assessable value of the
proposed finished product. This approval needs to be taken before the commencement of the Manufacturing Activity. The said application
shall contain all the details of products to be manufactured and Quantity in each batch during a given period of time. In case, the
company produces more quantity in a batch than that was mentioned in the approved application, then company shall remit the excise
duty on the differential quantity. If the quantity produced in a batch is less than the approved one, the refund of unutilized excised duty
from the department cannot be claimed. The produced units shall absorb the said unutilized excise duty amount. The company considers
the normal loss while making the application and accordingly mentions the estimated quantity in each batch.
Custom Duty:
Duty levied by the government when a material is imported to India from abroad.
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 7 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Purchasing Organization
Current
Code
New
Description
Code
1100
Description
Walvoil Purchase
Organization
Purchase groups
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 8 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Current
New
Code
Code
Description
101
Domestic
102
Imports
103
Services
104
MRO
105
Jobwork
Description
106
Miscellaneous
Storage Locations
Current
New
Code
Code
Description
RM01
Raw materials
Storage location
SF01
FG01
SP01
Semi Finished
Finished
spares
PK01
Packing
Storage
Storage
Storage
Storage
SC01
Scrap
Storage location
Description
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
location
location
location
location
Page 9 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
4.1
4.1.1
4.1.2
4.1.3
4.1.4
4.1.5
4.1.6
4.1.7
4.1.8
4.2
4.2.1
4.2.2
4.2.3
4.2.4
4.2.5
4.2.6
4.2.7
4.2.8
4.2.9
4.2.10
4.3
4.3.1
4.3.2
4.3.3
4.3.4
4.3.5
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 10 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
4.3.6
4.3.7
4.3.8
4.3.9
4.3.10
4.4
4.4.1
4.4.2
4.4.3
4.4.4
4.4.5
4.4.6
4.5
4.5.1
4.5.2
4.5.3
4.5.4
4.5.5
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 11 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 12 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Material Coding
As Is
Material Type
Raw materials
External /
Internal
Total Length
Logic1
Not following any codes now
Semi finished
Goods
Finished Goods
Spares
Misc
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 13 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
To Be
Materia
l Type
Ext
/
Int.
Ext
Total
Length
10
Group
1
length
Logic1
Group
2
length
Logic2
Group
3
length
Logic3
Page 14 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
As Is Business Process:
Not following any separate master data like
Material master
Vendor master
Customer master
Vendor approved price list
Service master
Business Requirement :
1. SAP Best Practises for IM & C to be implemented where ever
suits to Walvoil requirement.
Requirement Analysis
SAP R/3 provides functionality for maintaining the following master data:
Materials
Services
Vendors
Purchasing Info Records
Source List
Vendor Evaluation Criteria
Conditions (Commercial)
Payment Terms
Suggested Business Process:
Materials:
The material master contains information on all the materials that a
company procures or produces, stores, and sells. It is the company's
central source for retrieving material-specific data. This information is
stored in individual material master records.
The material master is used by all components in the SAP Logistics
System. The integration of all material data in a single database object
eliminates redundant data storage. In the SAP Logistics System, the
data contained in the material master is required, for example, for the
following functions:
In Purchasing for ordering
In Inventory Management for goods movement postings and physical
inventory
In Invoice Verification for posting invoices
In Sales and Distribution for sales order processing
In Production Planning and Control for material requirements planning,
scheduling, and work scheduling
Service Master
Service master records, in which descriptions of all services that may
need to be procured can be stored
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 15 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Vendor Master
Data in vendor master records controls how transaction data is posted
and processed for a vendor. The vendor master record also contains all
the data you require to do business with your vendors.
The master record is used not only in Accounting but also in Materials
Management. By storing vendor master data centrally and sharing it
throughout your organization, you only need to enter it once. You can
prevent inconsistencies in master data by maintaining it centrally. If one
of your vendors changes their address, you only have to enter this
change once and your accounting and purchasing departments will
always have up-to-date information.
Purchase info records
You use this component if you wish to store information on a vendor and
a material as master data at purchasing organization or plant level. You
can create purchasing info records for different procurement types
(standard, subcontracting, pipeline, consignment).
Source List
The source list is used in the administration of sources of supply.
It specifies the allowed (and disallowed) sources of a material for a
certain plant within a predefined period. Each source is defined by
means of a source list record.
Vendor Evaluation Criteria
The Vendor Evaluation component supports you in optimizing your
procurement processes in the case of both materials and services.
Gaps:
4.1.1 Material Master Maintenance
As Is Business Process:
Not following any material master data
Item Code Numbering System
Business Requirement:
1.SAP Best Practises for IM & C to be implemented where ever
suits to Walvoil requirement
Requirement Analysis
1. You can identify material or document changes that are made with
reference to a change number by the use of revision levels.
When you want to process the BOMs for these materials or documents at
a later date, you can find and call them using either the change number
or the revision level.
You can assign a revision level to a material either from an engineering
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 16 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Page 17 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Page 18 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
changes Display etc., Also one can make use of setting deletion indicator
for a material at various levels in the organization structure. Walvoil can
make use of this available feature as per the business requirement.
10. Search help control is an ActiveX component. It was developed to
support the SAP search help technique.
In contrast to the previous search help technique, which used R/3 dialog
boxes, search help control uses a dialog technique that is sessionindependent. This means that the user can only open search help
windows one at a time.
Search help windows may, however, remain open within a single
transaction. This allows you to refer to the results displayed in a
particular search help window on subsequent screens of the same
transaction.
With match codes, you can use the menu to choose from the various
different search possibilities displayed
Clicking on the right mouse button displays all of the search help control
functions available in the current context.
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 19 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Page 20 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Page 21 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 22 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Material Type:
Materials with the same basic attributes are grouped together and
assigned to a material type. This allows Walvoil to manage different
materials in a uniform manner in accordance with your company's
requirements. Examples of material types are given in the graphic
below.
Material Group:
Key that you use to group together several materials or services with
the same attributes, and to assign them to a particular material group.
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 23 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Use
You can use material groups to:
Restrict the scope of analyses
Search specifically for material master records via search helps
Gaps :
4.1.2 Service Master Maintenance
As Is Business Process:
Not following Service master data
Business Requirement:
1.SAP Best Practises for IM & C to be implemented where ever
suits to Walvoil requirement
Requirement Analysis
Service activities process shall be carried in SAP System as per the
requirement.
Service Request/Material Request/ Capex Request shall be through the
SAP System (Purchase requisition RFQ Quotation- Price ComparisonPurchase Order-Service entry sheet-Invoice Verification and Payment).
Purchase Requisition shall be based on the material group but Standard
system also provides features to create PRs on Material, Account
Assignment, Item category, plant etc.,
Suggested Business Process:
The service master record counts as part of the master data within
External Services Management and serves as a source of data for you to
draw upon when creating service specifications. This enables you to save
time and reduces the frequency of errors, since you need only enter the
complete service descriptions in the service master record once.
Structure
A service master record contains the following principal information for
the unique description of a service:
Service number
Service category
Descriptive texts (short and long text)
Base unit of measure
Material group
Valuation class
Gaps:
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 24 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Requirement Analysis
1. Business partners have a number of different functions, described as
partner functions, in connection with your company. You use partner
functions to define the rights and responsibilities of each partner type in
a business transaction. When you sell or order goods, for example, your
business partners can assume partner functions such as:
Vendor Partner functions:
a. Ordering address
b. Goods supplier
c. Invoice presented by
d. Alternative payee
Different business partners may carry out one or more partner functions.
For this reason, you can assign individual business partners a number of
partner functions.
You manage data on business partners in master records. Data on
partner functions is stored in these master records and used in Financial
Accounting and Logistics.
A business partner can be a customer and a vendor at the same time if,
for example, your customer also supplies goods to you or if a vendor is
also one of your customers. In this case, you must create a customer
master record and a vendor master record for the business partner. You
can create a link between the two master records by entering the vendor
number in the customer master record and the customer number in the
vendor master record.
2. Terms of payment are rules agreed with your business partners. They
apply to financial clearing for goods and services. Standard system
allows one to associate terms of payment at master data level and at
transaction level.
3. Your company does business with some business partners for a long
time. For example, you have special price agreements with long-term
customers and their deliveries get preferential treatment. At the end of
the fiscal year, you can honour the loyalty of these customers with rebate
payments. In other cases, you have only one contact with a business
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 25 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Page 26 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
General data
This is data that applies to every company code and every purchasing
organization in your company. The general area includes, for example,
the vendors name, address, language, and telephone number.
Company code data
This is data that is specific to an individual company code. Company
code data includes, for example, the reconciliation account number and
payment terms.
Purchasing organization data
This is data relevant to the purchasing organization of your company. For
example, requests for quotations, purchase orders, and invoice
verifications are stored in this section.
Vendor groups
1. Raw material supplier- domestic
2. Packing material supplier -Domestic
3. Miscellaneous purchases Vendors
4. Capital Purchases
5. One time vendors
6. Financial vendors
7. Transport vendors
8. Raw material supplier- Imports
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 27 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Requirement Analysis
Info Record Price Versus PO Price
The net price in the info record and the net price in the purchase order
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 28 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Business Requirement:
1.SAP Best Practises for IM & C to be implemented where ever
suits to Walvoil requirement
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 29 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 30 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Requirement Analysis
Suggested Business Process :
The source list is used in the administration of sources of supply.
It specifies the allowed (and disallowed) sources of a material for a
certain plant within a predefined period. Each source is defined by
means of a source list record.
The source list serves:
To define a source of supply as "fixed". Such sources count as
preferred sources over a certain period of time.
(For example, the fixed vendor for material 1 is Acme Corp. for the
first quarter and Zenith Co. for the second quarter of the year.)
To define a source of supply as "blocked".
(This means, for example, that contract 123 may not be used for a
certain period of time.)
As an aid in selecting the preferred source during the source
determination process.
(For example, the vendor Zenith Co. is determined as the source for an
item of a requisition dated 15th June relating to material 1.)
To block the external procurement of a material.
(For example, material 1 may not be ordered from 01.01.98 to
12.31.98.)
Gaps:
Requirement Analysis
Suggested Business Process:
The Vendor Evaluation component supports you in optimizing your
procurement processes in the case of both materials and services.
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 31 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Page 32 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
4.1.7.2
Prices
As Is Business Process :
Suggested Business Process:
All Inclusive prices (Net Price): It is a net price This component enables you to store pricing stipulations agreed with
for the merchandise.
the vendor (such as applicable discounts or surcharges, or stipulations
regarding the payment of freight costs) in the system. You can enter
1. Basic price: It is unit price.
2.Gross price: Basic + Duties and taxes also these conditions in quotations, outline purchase agreements, and info
records. You also have the option of entering general conditions at
net of discounts
vendor level, for example. The system then applies the conditions in
3.Economy of price of supply should capture
determining the price in purchase orders (POs). You can enter further
vendors rejections
conditions in the PO itself.
There are three kinds of price in Purchasing:
Gross price
Price without taking any possible discounts and surcharges into
account.
Net price
Price taking any applicable discounts and surcharges into account.
Effective price
Net price after deduction of cash discount, with allowance for any
miscellaneous provisions, delivery costs, and non-deductible taxes.
Pricing conditions shall be maintained in the purchasing info records or
in the header or item level as applicable
Discounts 1.% Discount: Adholeram discount (Basic
1. Different discounts required by Walvoil are Discount before Tax and
Price)
Discount after tax. The Discount condition records shall be maintained
with conditions and values associated with conditions. While processing
2.Value Discounts: On the total value fixed
a transaction system will search for valid record and as soon as it finds
amount is
the record matching the condition of sale it should return a discount
3. Cash discounts: Discount given on
value.
Immediate Payment (Basic Price).
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 33 of 77
4.Materials Management
4.1.7.3
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
4.1.7.4
Sales
Tax/VAT
4.1.7.5
Local
Delivery
and
Cartages
Freight/Tr
ansport
Service
Tax
Cess
4.1.7.6
4.1.7.7
4.1.7.8
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 34 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Customs Duty = X X () % = Y
Cess of CD = Y X () % = Z
CVD = (X X Y) X () % = A
Cess on CVD = (A + Y + Z) X () %
4.1.8 Payment Terms
As Is Business Process
Requirement Analysis
There are various payment terms. Payment terms for procuring RM Suggested business process:
and PM, Payment terms for Procuring Assets, MRO Items are
1. Walvoil shall use the standard payment terms wherever possible.
different.
2. Wherever required, specific payment terms shall be defined in the
system like Payment with LC.
Business Requirement:
1.SAP Best Practises for IM & C to be implemented where ever
Gaps:
suits to Walvoil requirement
Business Requirement:
1.SAP Best Practises for IM & C to be implemented where ever
suits to Walvoil requirement
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Ltd.
As Is Business Process :
Requirement Analysis
Product code, Product description, required qty. . . . Now at Walvoil PR Shall be addressed as different Purchase requisition Document type
using Excel for creating the Purchase Requisition.
and Number range
Approved vendor list shall be created in the system.
Business Requirement:
Changes to Purchase requisition shall be made possible upon approval
from authorised person.
SAP Standard Report is available
1.SAP Best Practises for IM & C to be implemented where ever
suits to Walvoil requirement
Integration issue with PP module. To explore further
Recheck option like error messages and warnings can be thrown.
Requirement Analysis MRO Items
Each procurement document will have a unique number
Purchase requisition line item details like material code, plant, storage
location, material group details etc.,
Since Purchase requisition line items will have materials codes, the
specification attached to master data can be copied to document.
Previous supply details can be seen through a separate SAP Standard
report
Through source determination component Recommended supplier
details can be incorporated.
Purchase requisition line item will have all such details
Possible through Release procedure. Release procedure process is
explained in sub process 4.2.5
Changes to the approved purchase document shall be restricted
Purchase requisition document provides feature to capture costs on to
a cost centre or to G/L account.
Amendment to Purchase requisition shall be made possible before
release.
SAP Standard Report provides this feature
All the Purchase documents in Standard SAP System are linked.
SAP Standard Reports provides this feature
Suggested Business Process:
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Ltd.
Requirement Analysis
Using reference technique method provided by SAP One can copy the
contents for further processing.
MRO ITEMS
For Capex items possible, electrical items (bulbs, fans etc) Sources Each indent will have separate enquiry.
are identified (Identification of Sources by past Purchases by
Specification about materials shall be copied if they are maintained
Journals or Industrial Directory or by reference) and enquiry is
Quantity shall be copied as per the reference technique method
floated over phone or by letter.
It is possible to mention Quotation expected date
Technical/ Commercial Specifications are explained, Requirement is Provision for mentioning a bench mark price is possible.
emphasised and quotes are obtained.
Provision for mentioning tax and duty structure is possible.
Specification should include the individual characteristics of the
Mentioning of commercial terms is possible
item make material etc.,
SAP Standard Report General Analysis report
Tax and duty structures applicable for the company in respective of
the item on procurement
Suggested Business Process :
Other requirement of commercial terms should be explicitly
You use this component if you wish to manage and compare requests
mentioned.
for quotation (RFQs) issued to vendors and the quotations submitted
Sending Enquires to vendors should be possible through direct
by the latter in response to them.
mailing, fax, Printout.
In Purchasing, the RFQ and the quotation form a single document.
Prices and conditions quoted by vendors are entered in the original
RFQ. If you have issued an RFQ to several vendors, you can have the
Business Requirement :
system determine the most favourable quotation submitted. You can
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also store the prices and terms of delivery from certain quotations in
an info record for future accessing.
Gaps:
4.2.3 Quotation
As Is Business Process:
Quotation received from the vendor will consist of quantity, price,
Payment terms, CST and KST, ECC Number, Delivery terms.
Quotations are compared based on price, Vendor has been
finalised.
Business Requirement :
1. SAP Best Practises for IM & C to be implemented where ever
suits to Walvoil requirement.
Requirement Analysis
Standard SAP Report Price comparison list
Suggested Business Process:
A quotation is an offer by a vendor to a purchasing organization
regarding the supply of materials or performance of services subject to
specified conditions.
A quotation is legally binding on the vendor for a certain period. The
quotation is the vendors response to a request for quotation issued by
a purchasing organization.
A quotation consists of items in which the total quantity and delivery
date of an offered material or service are specified.
An item of a quotation may contain a delivery schedule made up of a
number of schedule lines in which the total quantity is broken down
into smaller quantities to be delivered on the specified dates over a
certain period.
An item of the procurement type External service contains a set of
service specifications. The latter can be hierarchically structured. The
summary view of such a hierarchical structure is referred to as an
outline. The outline comprises a number of levels, each representing a
level of the service hierarchy. The quantities of the quotation are set
out in service lines, representing individual jobs or activities.
If services cannot be defined precisely, value limits are stipulated
instead of service lines. Value limits can be set for certain contracts.
Conditions can apply at various levels:
To the entire quotation
At item level, to the material to be supplied or to the planned
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Ltd.
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Ltd.
As Is Business Process:
Purchasing raw materials, Bought-Out items, consumables, MRO
Suggested Business Process:
Items, Capital Goods, Tools and samples.
Walvoil shall make use of this component to procure materials or
Based on the indents received manual segregation of urgent and
services.
normal indents are made, enquires over phone, fax, mail etc., are Purchasing Document - Definition
made. At times numerous attempts are made to obtain realistic,
A purchasing document is an instrument used by Purchasing to procure
competitive prices from vendors of the material group. Depending materials or services.
on the quotes received negotiations with the prospective vendor is
The following list shows the various external purchasing documents
made and order confirmation over phone is first made. On this
available in the standard SAP System. (Note: purchase requisitions are
context it is to be noted that details of the specifications to be
not included on this list because they are usually regarded as internal
communicated over phone or fax is an important aspect of
documents used within Purchasing and are therefore treated
obtaining possible offers. It is also possible that vendors taken for
separately.)
obtaining quotes may not be interested, may not be dealing in that
line of product or make. Hence new vendors are explored through Request for quotation (RFQ)
Transmits a requirement defined in a requisition for a material or
old records, yellow pages, Indenting departments contacts.
service to potential vendors.
Once PO is made after the terms are finalised, PO are faxed to the
Quotation
party and original is sent by courier/post.
Contains a vendor's prices and conditions and is the basis for vendor
PO is generated using excel worksheet and a manual register for
selection.
PO number is maintained. This register will contain brief details of
Purchase order (PO)
the item on order and the file number of the item on order.
The buying entitys request or instruction to a vendor (external
The typical PO will contain PO number, date, File number, Quote or
supplier) to supply certain materials or render/perform certain
offer reference if any,
services/works, formalizing a purchase transaction.
Also details of material description, specification, rate, quantity,
Requirements of materials or services can be reported to Purchasing by
and value are incorporated. Further order terms such as price,
means of purchase requisitions.
delivery, delivery schedule, duties, taxes, transport, payment terms
Structure
as well as excise and tax particulars are mentioned in the order.
Each purchasing document is subdivided into two main areas: the
header and individual items. Each document will contain a header and
Business Requirement :
can contain several items.
The header contains information relevant to the whole document. The
1. SAP Best Practises for IM & C to be implemented where ever
items specify the materials or services to be procured. For example,
suits to Walvoil requirement.
information about the vendor and the document number is contained
in the document header, and the material description and the order
quantity are specified in each item.
The additional data provides extra information about the item, and has
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the header.
A procurement type is defined for each of the document items. The
following procurement types exist:
Standard
Subcontracting
contracts
Stock transfer
External service
Delivery of the total quantity of material (or performance of the total
volume of services) specified in a purchase order item can be spread
over a certain period in a delivery schedule, consisting of lines
indicating the individual quantities with their corresponding planned
delivery dates.
An item of the procurement type "external service" contains a set of
service specifications. The latter can be hierarchically structured. The
summary view of such a hierarchical structure is referred to as an
outline. The outline comprises a number of levels, each representing a
level of the service hierarchy. The order quantities are set out in
service lines, representing individual jobs or activities. Value limits are
specified instead of service lines for services or work that initially
cannot be specified precisely.
If services covered by an already existing contract are released
(ordered, or called off against the contract), the PO item can contain a
value limit relating to the contract in question.
Conditions
Conditions can apply at various levels:
To the entire purchase order
At item level, to the material to be supplied or to the set of service
specifications in the case of services
At service line level for individual services (tasks or activities)
Account Assignment
Costs can be apportioned among various Controlling objects via the
account assignment.
PO History
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As Is Business Process:
PO are created manually with all the import indent terms and
bankers details etc., and forwarded to the seller/indenting agent.
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Ltd.
LC application
Declaration
Indemnity bond
PO
Payment request) from FI, Internal order shall have reference to the PO
created.
LC cannot be addressed in Standard SAP System.
Duty Payment (CVD) and Customs duty payment shall be through the
Advance payment request, For availing the Customs duty; This will be
same process as that of availing cenvat. Customs duty and CV D
condition shall have vendors mentioned against to those conditions
mentioned in PO. Customs department shall be created as vendor in
the system. Clearances Charges (CHO charges) shall also mentioned in
PO as conditions. These conditions shall have provision to maintain
Vendors in PO.
Gaps:
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As Is Business Process :
Not Following
Business Requirement:
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As Is Business Process :
Suggested Business Process:
Currently purchase through cash payment is resorted for various
small value and consumable items as well as office maintenance
Cash purchases can be carried out in the Standard SAP System through
items. Such purchases are also resorted in case of any emergency invoice verification and posting to relevant accounts.
requirements of specific items.
1. GR without reference to any order can be set to active.
The items of purchase are initiated by the departments through a 2.Indicator for cash purchase can be set at header level texts at the
formal material indent and sent to commercial department. As and time of GR
when such materials are received at the stores and necessary GRNs
3. A Separate report shall be developed using ABAP.
made the relevant bills are submitted to accounts after due
approval by commercial head to square up the impreset advance. 5.PO History would fulfil this requirement
Gaps:
Business Requirement
1.SAP Best Practises for IM & C to be implemented where ever suits
to Walvoil requirement
Requirement Analysis
It is possible to capture through a separate field in GR screen. It is
suggested as a solution that Each and every GR Transaction will have
feature to capture excise invoice. Provision to capture excise invoice
separately apart from GR Transaction will be provided.
To print GR details like Document date, LR number (should be
mentioned in header text) shall be printed.
Consignment should accompany COA as per the requirement in QM
module and Inventory module of MM.
Goods receipt in Standard system is based on with Reference to orders
basically (PO, Production order, etc.,) or without reference to any
document. GR Program will only refer to the documents. Hence at time
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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.
If a further subdivision by lots is required for a material, one batch per
Business Requirement
lot is possible. These batches are then managed individually in the
stock.
1.SAP Best Practises for IM & C to be implemented where ever suits
Special Stocks
to Walvoil requirement
Inventory Management can manage various types of a companys own
special stocks and externally owned special stocks separately from
standard stock.
Managing Stocks By Value
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
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Ltd.
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Ltd.
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Ltd.
receipt document are checked to ensure that they match those in the
invoice.
Integration in Production Planning
Inventory Management is closely linked to the Production Planning
module:
Inventory Management is responsible for staging of the
components required for production orders
The receipt of the finished products in the warehouse is posted
in Inventory Management.
Integration in Sales & Distribution
As soon as you enter a sales order, you can initiate a dynamic
availability check of stocks on hand.
When the delivery is created, the quantity to be delivered is marked as
"Scheduled for delivery". It is deducted from the total stock when the
goods issue is posted.
It is also possible to create sales order stocks.
Integration in Quality Management
In the case of a goods movement, the system determines whether the
material is subject to an inspection operation. If so, a corresponding
activity is initiated for the movement in the Quality Management
system.
Integration in Plant Maintenance
Inventory Management is linked with Plant Maintenance as follows:
When serial number management is active, the individual serial numbers are
entered in the case of every goods movement. Serial numbers are managed in
the Plant Maintenance system
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4.3.1
As Is Business Process :
Not following
Business Requirement:
1.SAP Best Practises for IM & C to be implemented where ever
suits to Walvoil requirement
Requirement Analysis
1.Goods receipt shall be with reference of PO. Subsequent functioning
like GR shall be with reference to PO
2.Report to Distinguish GR Material group wise shall be addressed
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Ltd.
Requirement Analysis
1.Receiving material from Production order into finished goods stores
shall be taken care
Suggested business process:
Deliveries from production are the result of orders used as a basis for
manufacturing the materials required.
The production order is not only the document on the basis of which a
material is manufactured; it is also an important planning and tracking
tool for the following departments: Materials Planning and Inventory
Management.
Features
Reference to an Order
When material resulting from a production order is delivered, it is
important for the departments involved that the goods receipt entry in
the system reference this order, for the following reasons:
Goods receiving can check whether the delivery actually corresponds to
what has been planned.
The system can propose data from the order during entry of the goods
receipt (for example, the material produced, its quantity, and so on).
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This simplifies both the data entry and checking (over deliveries and
under deliveries).
The quantity delivered and the delivery date is updated in the order.
The order number is usually listed on the slip accompanying the
delivered material. If it is not listed on the slip accompanying the
delivered material, you can find the order pertaining to the delivery via
the material number.
Gaps:
4.3.4 GRN due to Finished Goods Rejection
As Is Business Process:
Not following
Requirement Analysis
This is addressed in the sub process: Purchase order.
Should be decided by the relevant department/Management of Walvoil.
There are stock statement reports in SAP System. Indenter to run
through those reports on certain intervals.
Should be decided by the relevant department/Management of Walvoil.
Should be decided by the relevant department/Management of Walvoil.
SAP Standard report is available in the inventory management module,
sub module of materials management module.
Suggested business process:
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Goods Receipt
Purpose
You use this component to post the receipt of goods from an external
vendor or from production. A goods receipt leads to an increase in
warehouse stock.
Features
The R/3 System distinguishes between the following types of goods
receipts:
Goods receipts with reference to a reservation
Goods receipts with reference to an order
Gaps:
4.3.6 GRN into Blocked Stock
As Is Business Process:
Not following
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4.Materials Management
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Ltd.
Business Requirement:
1.SAP Best Practises for IM & C to be implemented where ever
suits to Walvoil requirement
4.3.7 GRN due to Outbound Service / Job Orders(Purchase Orders for Service)
As Is Business Process:
Not following
Requirement Analysis:
Material sent to vendor shall be QC Passed if and only the material is
issued for subcontracting from Walvoil location.
Requirement analysis:
Not following
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Use
When you procure goods externally, an excise invoice accompanies
each delivery that your vendors make. You have to post these in the
system. This document is required as proof of the excise duty that you
have paid, so that you can then offset the duty against the excise duty
that you levy on outputs.
You can capture and post excise invoices in one or two steps,
depending on your business requirements.
In the two-step procedure, the excise clerk captures the
incoming excise invoice. This means that the clerk enters the
data, but the system does not yet create an entry in Part II of
the appropriate excise register. Another user (the excise
supervisor) checks the excise invoice and posts it. The system
then creates a Part II entry.
In the one-step procedure, the excise clerk captures and posts
the incoming excise invoice simultaneously. The system creates
the Part II entry automatically.
Generally speaking, you have one excise invoice for each goods receipt;
u can also do multiple GR for a single excise invoice.
In the R/3 System, the excise invoice consists of header data and line
items. The header data comprises:
An internal number
Quantity of materials
Excise duty base amount
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registers, RG 23A and RG 23C for raw materials and capital goods
respectively. This is no longer the case, but the distinction still remains
in the R/3 System.
Register RG 23D
Definition
A record of receipts and issues of excisable materials, as kept by
depots.
Serial Numbers
Use
The system automatically numbers all entries in the following registers
with a serial number:
RG 1
PLA
Each excise group defines its own number range intervals
Download Register Data
Use
You use this report to download data from the registers listed below
onto your hard drive. The information is saved in flat file format and
can then be processed by non-SAP software to produce registers. This
solution is thus an alternative to that described under Creation of
Excise Registers.
Use
You use this report to download data from the registers listed below
onto your hard drive. The information is saved in flat file format and
can then be processed by non-SAP software to produce registers. This
solution is thus an alternative to that described under Creation of
Excise Registers.
This report covers the following registers:
RG 1
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PLA
Plant excise details
Monthly Return
Use
The central excise authorities have by vided notification no: 2000-(N.T)
dated 28th April, 2000, prescribed the form of monthly return under
rule 57AE of the central Excise Rules, 1944.
The SAP System offers you a report with which you can prepare the
necessary printouts. It covers both of the following:
Annexure
This is a list of all the invoices and bills of entry for which you have
made a Part II credit posting over the past month. For each document,
it shows the information required by the authorities.
Abstract
This is a summary of the excise information from the annexure.
Subcontracting Without Payment of Excise Duty
Purpose
When you issue materials to a subcontractor, you need to keep track of
what materials you have issued and when they have to be returned by.
The reason for this close monitoring has to do with Indias tax law.
Under excise law 57AC, when you send materials to a subcontractor for
processing, you are not required to pay any excise duty, even though
the materials have left your premises. However, if the materials have
not been returned to you within a given length of time specified by the
law (in 2000, 180 days), you will have to reverse any excise credit that
you posted when you purchased the materials. In the case of materials
that you have manufactured in-house, you will have to post credit
entries to the extent of the CENVAT rate of the assessable value of the
materials.
Subcontracting Under Full Payment of Duty
Purpose
This procedure illustrates how you use the R/3 System to send
materials to your subcontractors for processing using normal excise
invoices.
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Capital Goods
Use
Businesses are allowed to set off excise duty on purchases of capital
goods against excise duty on outputs. However, unlike with raw
materials, you can only set off half of the duty in the first year, and the
rest in any year after that.
Features
When you post an excise invoice that contains capital goods, the
system posts half of the excise duty to your CENVAT account and post
the rest to a G/L account for CENVAT on hold.
In following years, you can use a report to identify the capital goods
with excise duty on hold and transfer the duty to the CENVAT account
Transfer of CENVAT Credit on Capital Goods
Use
You use this report to display a list of the vendor excise invoices where
the vendor has levied excise duty but you have not posted it (in full) to
your CENVAT account.
This is particularly useful in the case of capital goods in order to find
out how much credit remains from previous years.
Capturing Excise Invoices Without Reference Documents
Use
This procedure shows you how to capture an incoming excise invoice if
you do not have any reference documents.
You can also follow this procedure if you do have a material document
that you want to use as a reference document, but you want the
system to cross-check the excise invoice data against other master
data or transaction data less stringently than it normally would
You commission a construction company build a new plant for you. The
company purchases all the materials it needs to build the plant, deals
with all of the invoices and most of the other paperwork, with the
exception of the incoming excise invoices, which the law requires you to
deal with yourself. The subcontractor sends you all excise invoices
accordingly and you capture them in the system without any reference
documents.
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
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4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Gaps :
4.3.9 Normal Rejections Handling
As Is Business Process:
Not following
Business Requirement:
1.SAP Best Practises for IM & C to be implemented where ever
suits to Walvoil requirement
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 67 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 68 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
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4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Requirement analysis:
SAP Standard report will give output to users to view materials left out
at subcontract vendor
Business Requirement:
1.SAP Best Practises for IM & C to be implemented where ever
suits to Walvoil requirement
Gaps :
4.4.2 Goods Issue To Scrap
W
As Is Business Process:
Not Following
Business requirement:
1. SAP Best Practises for IM & C to be implemented where ever
suits to Walvoil requirement.
In the R/3 System, you post a scrapping like a goods issue without
reference
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
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4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Gaps:
to production
4.4.3 Goods issue to production
As Is Business Process:
Not following
Business Requirement:
1. SAP Best Practises for IM & C to be implemented where ever
suits to Walvoil requirement
Requirement analysis:
1. Through reference technique method This feature is available in
standard SAP system.
Suggested business process:
Goods issues shall be based on the sales order, deliveries will have
reference to the sales order. Goods issues will be based on the lot, qty,
Issuing plant and storage location
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 71 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Gaps:
4.4.5 Goods issue to quality
As Is Business Process:
Not Following
Business Requirement:
1.SAP Best Practises for IM & C to be implemented where ever
suits to Walvoil requirement
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 72 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
agreement)
Subsequent debit shall be used for transactions where the Original
Invoice verification for services (Labour work, AMC, Testing charges invoice has already been cleared and a subsequent invoice has been
raised by the vendor for materials already sent. Example: Rate change
etc.,)
with retrospective effect.
Subsequent Credit shall be used when any deduction/ penalty is to be
Business Requirement
levied on the vendor.
There are 3 options, which can be used for Invoice Verification.
1.SAP Best Practises for IM & C to be implemented where ever suits
1.Goods / Service Item
to Walvoil requirement
2.Delivery Costs
3.Goods/Service Item + Delivery costs
Based on the Goods/Service and delivery vendors, the option shall be
selected.
Gaps:
4.5.1 Entry of Vendors Invoice
Sub Process S
As Is Business Process:
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4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
3. Invoice verification with out PO. (Reference is taken through GRN by the vendor can also be entered during invoice verification.
for Invoice amount less than Rs 6000/-)
In these adjustments wherever the invoice involves the CENVAT, based
on the Tax code maintained, vendor and material tax details CENVAT
clearing account is prompted and will be updated on saving. Simulation
Under this scenario GRN and PO reference is taken, check for the
facility is available for checking the accounting effect.
Excise or Non-excise, qty received, PO number, GRN Number,
Accepted Qty.
Import Vendor
4.Invoice verification for transporters payment (Reference is
Imports invoice verification is slightly different from the normal invoice
agreement)
verification. In this case the CVD applicable is taken into RG23
Registers. In Import PO the CVD and other conditions are maintained
Under this scenario commercial department will send the vendor
invoice. Commercial department will mention the GAN number on as delivery condition types hence the Invoice verification for the CVD
part is to be done first before the GR is done. Then RG part1 entries are
back end of the invoice. Invoice entries are done using Excel.
done then GR is done and then RG part2 entries are posted. Invoice
5.Invoice verification for services (Labour work, AMC, Testing
verification is done for the Purchase Order. In this case No GR based
charges etc.,)
Invoice verification is possible (This is specific to Imports only).
Entries are done by referring to PO (>6000) else the entries are
The other functions as mentioned under Local Vendor Invoice
passed without any reference.
verification are also applicable for Import Vendor.
Business Requirement
1.SAP Best Practises for IM & C to be implemented where ever suits
to Walvoil requirement
4.5.2 Parking of Vendor Invoice
As Is Business Process:
Not following
Business Requirement:
1.SAP Best Practises for IM & C to be implemented where ever
suits to Walvoil requirement
Sub Process S
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 74 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Sub Process S
As Is Business Process:
Not following
Business Requirement:
1.SAP Best Practises for IM & C to be implemented where ever
suits to Walvoil requirement
Split Valuation
Split valuation serves the purpose of valuating stock at different
values based on different sources of procurement.
If a material is subject to split valuation, every quantity (sub-stock) of
this material must be assigned to a valuation Type.
If you want to valuate stocks of a material separately, you must create
a material master record with the appropriate valuation category. This
record is called the valuation header record. Each material always has
only one such record for each company code or plant (depending on
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 75 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Requirement Analysis:
With physical inventory process the adjustment of stocks shall be done
with the required accounting effect
Suggested business process:
Physical inventory component allows the carrying out of physical
inventory of the companys warehouse stock for balance sheet purpose.
There are different types of physical inventory procedures like Periodic
Processing, Continuous inventory, Cycle counting. Any of these
techniques can be used for this process.
Periodic Inventory:
In this process all the stocks in the company are physically counted on
the balance sheet key date. The entire warehouse must be blocked for
materials movement
Continuous Inventory
Continuous inventory ensures that all the material is counted at least
once during the year. Stocks are counted throughout the year.
Cycle counting
Cycle counting is a method of physical inventory where inventory is
counted at regular intervals within a fiscal year.
Inventory Sampling
Inventory sampling method uses random selection of stocks and these
samples are physically counted on the balance sheet date. If only small
variances occur in the count and the physical inventory, it is presumed
that the inventory balances and book stock are correct.
The counts can be entered in the system and the differences can be
reconciled between physical and book balance. The required accounting
effect is provided through this reconciliation.
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 76 of 77
4.Materials Management
As Is Business Process and Business Requirement from Walvoil Fluid To Be Business Process for Walvoil Fluid Power (India) Pvt.
Power (India) Pvt. Ltd.
Ltd.
Gaps :
5.0 Reports
AS Is Business Process :
No Reports are maintained
Business Requirement:
1.SAP Best Practises for IM & C to be implemented where ever
suits to Walvoil requirement
Business Blue Print Materials Management Mr.Rajan, Mr.Vinay WALVOIL, Mr.Srinivas - CVS IT
Page 77 of 77