In the forklift project, you can plan material costs by allocating material components to activities. You need to purchase non-stock components for your activities. You also need to record the working hours of the external supplier to your network activity.
Performing the Purchasing Process
Objective
After completing this lesson, you will be able to perform the purchasing process
Business Example
External Procurement and Processing
The network generates purchase requisitions for external processing activities, service activities, and material components procured externally (non-stock). These purchase requisitions are passed on to the purchasing department, where they are processed further.
A service activity triggers a similar purchasing process, but it can also contain a hierarchy of planned services to be purchased and value limits for unplanned services. Goods receipt for services involves two steps: entering the services performed and accepting the services.
The purchase requisition results in purchase requisition commitments for the account assignment object (activity or WBS element). When you convert the purchase requisition to a purchase order, it results in purchase order commitments for the account assignment object (this value type is different from the purchase requisition commitments). Based on the account assignment category of the purchase order, actual costs are posted upon goods receipt or invoice receipt (valuated, non-valuated goods receipt). Based on the account assignment, actual costs are passed on to the network activity or WBS element.
In the SAP standard system, you use account assignment category F for the account assignment of orders, which includes network headers, network activities, maintenance orders, internal orders, and manufacturing orders.
As an alternative to the automatically generated purchase requisitions, you can manually create purchase requisitions and purchase orders and assign them to WBS elements.
External Processing
In external processing, the purchase order defines the vendor and net price. The external activity can derive default values for the vendor and net price.
Account assignment for the costs of external processing is performed on the cost object. In the SAP standard system, when you post the goods receipt for external processing, the account assignment object is debited for the process based on the net purchase order price. However, depending on the account assignment category, the goods receipt is valuated or non-valuated. For account assignment category F, the good receipt is valuated.
External Processing: Goods Receipt
You post the invoice receipt with reference to the purchase order receipt. You post any differences between the preliminary goods receipt value (net purchase order price) and invoice value to the account assignment object.
External Processing: Invoice Receipt
Price differences between the goods receipt and invoice receipt are also updated to the cost object.
External Procurement
With non-stock procurement, you procure components directly from an external vendor. The business process of procurement of non-stock material components is quite similar to that of external processing: purchase requisition, purchase order, goods receipt, and vendor invoice.
When you post the goods receipt for externally procured products, the consumption of the provided part is posted simultaneously to the account assignment object, such as the activity. You post the goods receipt for the non-stock component as an expense, and not to inventory accounts. The account assignment object is debited with the costs of externally procured materials. The costs are based on the net purchase order price.
You post the invoice from the vendor with reference to the purchase order or delivery. You post any variance between the invoice value and purchase order value to the account assignment object.
The accounts for posting are selected using materials management automatic account determination.
Material Component Assignment
The following process examines a part of the forklift project that comprises the following:
Two WBS elements: F-120## and F-120##.3
Network activity 0080 (Production)
Assigned material component P-FL300; material component P-FL300 (chassis) is manufactured in-house
Components are assigned to activities in project F-120## using the BOM-PS interface.
Assembly Structure: MRP
Component P-FL300 is assigned to activity 0080. This component is produced in-house. During the BOM-PS transfer, the requirement for P-FL300 is assigned the stock type Project Stock.
When you execute MRP for the project, the BOM for P-FL300 is exploded and the demand is passed to components P-FL3A00, P-FL3B00, and P-FL3C00. These components are procured externally and inherit stock type Project Stock.
The individual/collective indicators for material include the following:
P-FL300 = 1
P-FL3A00 = ()
P-FL3B00 = ()
P-FL3C00 = ()
Purchasing Process
You determine plan costs for materials that are not managed as inventory using the purchasing information record or activity item. You can create an invoicing plan for a non-stock item.
Actual costs for non-stock components are debited to the activity (or network header, in the case of header assigned networks) at the time of the goods receipt. If a price variance occurs during invoice processing, the variance is posted to the activity.
You can enter non-stock components by referencing a material master or entering a descriptive text, unit of measure, and additional parameters for purchasing processing.
Stock Procurement Steps
Starting from the bottom, the system shows the purchasing and production processes involved in producing P-FL300 and the values in the production order, network, and WBS.
The process ends with the issue of P-FL300 from project stock and consumption by the network activity.
Purchasing Components
MRP for project F-120## plans all of the materials managed as project stock for F-120##. The costs under F-120## show the planned costs for P-FL300.
Material requirements planning results in purchase requisitions for materials P-FL3A00, P-FL3B00, and P-FL3C00 (in direct procurement, this also happens when there is no MRP).
Purchasing converts these requisitions to purchase orders for vendors. The report also shows a purchase order commitment.
Project Cost Element Report for Purchasing Components
This figure shows an example of a cost element report for a project.
If commitment accounting for the controlling area is active, the open purchase order items for the project are recorded as commitments.
Element 13300000 is a balance sheet account. All other elements are profit and loss accounts.
Goods Receipt for Purchase Order
Goods are received for purchase orders for components P-FL3A00, P-FL3B00, and P-FL3C00. The goods receipt increases the project stock for F-120##.
The goods receipt reduces the commitment by the amount of the purchase order value. The stock value is calculated due to the amount of standard costs (for standard price control) or purchase order value (for moving average price control). Differences between the receipt value and purchase order value are price differences that can be viewed as costs in WBS element F-120##, if you maintain account control accordingly.
In the report, the Stock column displays values for project stock (stock commitment). The Actual column displays the actual costs of project elements.
Project Cost Element Report for a Goods Receipt
This figure shows an example of a project cost element report.
If the balance sheet inventory account is created as a cost element (category 90), you can report project stock statistically for all goods movements of the project stock using value type 11. You use value type 11 to record a posting as a statistical actual value.
The project stock inventory value is dynamically determined based on the planned cost of the item. In this example, the purchase price was 3.780, but the stock value was determined as 3.880. The price variance of 100 was credited when the inventory was received.
Note
Before a balance sheet inventory account is created as a statistical cost element, the inventory account must be identified in MM account determination for the inventory posting process using transaction key BSK.
Element 13000000 is a balance sheet account. All other elements are profit and loss accounts.