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© 2008 SAP AG
Introduction to SAP ERP
Abstract
This teaching material is intended to explain how the fundamental
business processes interact with SAP ERP in the functional areas
of Sales and Distribution, Materials Management, Production
Planning, Financial Accounting, Controlling, and Human Capital
Management.
SAP University Alliances
Version 1.0
Authors Stephen TracyBret WagnerStefan Weidner
ProductSAP ERP 6.0Global Bike Inc.
LevelBeginner
FocusCross-functional integrationSD, MM, PP, FI, CO
SAP ERP
SAP University Alliances
Page 1-2© 2008 SAP AG
Course Content
Introduction to SAP
Navigation
Sales & Distribution
Materials Management
Production Planning
Financial Accounting
Controlling
SAP ERP
SAP University Alliances
Page 1-3© 2008 SAP AG
SAP
“Systems, Applications, and Products in Data Processing”
Name of the Company- SAP AG
- SAP America
- SAP UK
Name of the Software- SAP R/2
- SAP R/3
- SAP ERP
SAP ERP
SAP University Alliances
Page 1-4© 2008 SAP AG
Who is SAP?
SAP AG- Founded in Walldorf, Germany in 1972
- World’s Largest Business Software Company
- World’s Third-largest Independent Software Provider
Company Statistics- Over 40,000 employees in more then 50 countries
- 1500 Business Partners
- 36,200 customers in more then 120 countries
- 12 million users
- 100,600 installationsSource: SAP AG website
SAP ERP
SAP University Alliances
Page 1-5© 2008 SAP AG
Integrated Business Solution Vendors
SAP (Systems, Applications, & Products in Data Processing)- SAP ERP, All-in-One, Business by Design, Business One
Oracle Applications- Oracle, JD Edwards, PeopleSoft, Siebel, Retek
Microsoft Business Solutions- Dynamics: Great Plains, Navision, Axapta, Soloman
The Sage Group- Sage Software – Accpac ERP, PeachTree
SSA Global Technologies- BAAN
SAP ERP
SAP University Alliances
Page 1-6© 2008 SAP AG
SAP Architecture
World-wide usage
Designed to satisfy the information needs for business sizes (small local to large all international)- Multi-lingual
- Multi-currency
Designed to satisfy the information needs for all industries
SAP ERP
SAP University Alliances
Page 1-7© 2008 SAP AG
SAP ERP
Enables a company to link it’s business processes
Ties together disparate business functions (integrated business solution)
Helps the organization run smoothly
Real-time environment
Scalable and flexible
SAP ERP
SAP University Alliances
Page 1-8© 2008 SAP AG
SAP Architecture
Client/Server Environment- Client – hardware/software environment that can make a request for
services for a central repository of resources
- Server – hardware/software combination that can provide services to a group of clients in a controlled environment
Three – Tier Structure- GUI
• Graphical User Interface or Web Interface
- Application Server• One or more, help distribute work load
- Database Server• One single data repository
SAP ERP
SAP University Alliances
Page 1-9© 2008 SAP AG
SAP Architecture
Database
Application
Presentation
Browser ClientPCs, Laptops, etc.
Network
Application Servers
Database
Internet Transaction
Server
Web Server
SAP ERP
SAP University Alliances
Page 1-10© 2008 SAP AG
SAP Business Suite
SAP NetWeaver
SAP SCM
SAP PLM
SAP SRM
SAP CRM
SAP ERP ECC 6.0
SAP ERP
SAP University Alliances
Page 1-11© 2008 SAP AG
SAP Business Suite
SAP NetWeaver
SAP SCM
SAP PLM
SAP SRM
SAP CRM
SAP ECC
SD
MM
PP
QM
PM
HR IS
WF
AM
CO
FI
PS
SAP R/3Client/Server
ABAPBasis
SAP ERP
SAP University Alliances
Page 1-12© 2008 SAP AG
SAP Software Applications
Solutions- SAP ERP
- SAP CRM
- SAP PLM
- SAP SCM
- SAP SRM
- SAP Analytics
- SAP Manufacturing
- SAP Service
- SAP Mobile Solutions
- SAP xApps
Small & Medium Size Solutions- Business One
- Business by Design
- SAP All-in-One
Platforms- Enterprise Services Architecture
- SAP NetWeaver Platform
SAP ERP
SAP University Alliances
Page 1-13© 2008 SAP AG
SAP ERP Business Modules
Collections of logically related transactions within identifiable business functions- MM (“Buy”)
- PP (“Make”)
- SD (“Sell”)
- FI and CO (“Track”)
- HCM
SAP ERP
SAP University Alliances
Page 1-14© 2008 SAP AG
SAP ERP Core Applications
Logistics - Sales & Distribution
- Plant Maintenance
- Materials Management
- Production Planning
- Quality Management
Accounting- Financial Accounting
- Controlling
- Asset Management
- Treasury
Human Resources- Personnel Management
- Benefits
- Payroll
SAP ERP
SAP University Alliances
Page 1-15© 2008 SAP AG
SAP Industry Solutions
Aerospace & Defense
Automotive
Banking
Chemicals
Consumer Products
Defense & Security
Engineering, Const.
Healthcare
High Tech
Higher Education
Industrial Machinery
Insurance
Life Sciences
Logistics Service Prod.
Media
Mill Products
Mining
Oil & Gas
Pharmaceuticals
Postal Services
Professional Services
Public Sector
Railways
Retail
Telecommunications
Utilities
Wholesale Distribution
© 2008 SAP AG
Navigation
Abstract
This material explains how to navigate in SAP systems. It is aimed at
students at educational institutions, such as schools, universities of
cooperative education, universities of applied sciences, and other
universities, with no previous experience of SAP software. It can be used
in the classroom or for self-study.
On completion of the course, students will be able to navigate through the
user interface to deal with business processes and case studies.
SAP University Alliances
Version 1.0
Authors Stephen TracyBret WagnerStefan Weidner
ProductAll
LevelBeginner
FocusSAP ERP
SAP ERP
SAP University Alliances
Page 1-17© 2008 SAP AG
Content
User guidance
User specific settings
Navigation in SAP Easy Access Menu
Help
SAP ERP
SAP University Alliances
Page 1-18© 2008 SAP AG
Learning Targets
At the end of this chapter you can
Name the window elements
Navigate in an SAP system
Apply personal system settings
Effectively use Help
SAP ERP
SAP University Alliances
Page 1-19© 2008 SAP AG
Log on to an SAP system
SAP ERP
SAP University Alliances
Page 1-20© 2008 SAP AG
SAP Easy Access Menu
SAP ERP
SAP University Alliances
Page 1-21© 2008 SAP AG
SAP Easy Access Menu
SAP ERP
SAP University Alliances
Page 1-22© 2008 SAP AG
Role-based User Menu
SAP ERP
SAP University Alliances
Page 1-23© 2008 SAP AG
DYNPRO Elements
Radiobutton
Alternative 1 (nur eine Alternative möglich!)
ODER Alternative 2
oder .....
oder .....
oder .....
Anzeigen Ändern
Checkbox
Auswahl 1 (Mehrfachwahl möglich!)
Auswahl 4
Auswahl 2
Auswahl 3
Überblick
Check box
Radio buttons
Press buttons
Input fields
Tabs
System function bar
Application function bar
Command field (transaction code)
Status bar
SAP ERP
SAP University Alliances
Page 1-24© 2008 SAP AG
ENJOY Initiative – Old Design
Initial screen Header data
Position detailsPosition overview
SAP ERP
SAP University Alliances
Page 1-25© 2008 SAP AG
ENJOY Initiative – New Design
header data
position overview
position details
SAP ERP
SAP University Alliances
Page 1-26© 2008 SAP AG
Help Functions
F1: Description of Input Fields
F4: value list
SAP ERP
SAP University Alliances
Page 1-27© 2008 SAP AG
SAP Help Portal
http://help.sap.com
SAP ERP
SAP University Alliances
Page 1-28© 2008 SAP AG
Favorites
SAP ERP
SAP University Alliances
Page 1-29© 2008 SAP AG
Transaction Codes
SAP ERP
SAP University Alliances
Page 1-30© 2008 SAP AG
Transaction SEARCH_SAP_MENU
SAP ERP
SAP University Alliances
Page 1-31© 2008 SAP AG
Transaction ICON
SAP ERP
SAP University Alliances
Page 1-32© 2008 SAP AG
Multiple Selection
SAP ERP
SAP University Alliances
Page 1-33© 2008 SAP AG
User Profile Settings (local)
SAP ERP
SAP University Alliances
Page 1-34© 2008 SAP AG
User Profile Settings (SAP System)
SAP ERP
SAP University Alliances
Page 1-35© 2008 SAP AG
Desktop Shortcut
SAP ERP
SAP University Alliances
Page 1-36© 2008 SAP AG
Summary
You are now able to: - Name the window elements
- Navigate in an SAP system
- Apply personal system settings
- Effectively use help
© 2008 SAP AG
Global Bike Inc.
Abstract
This material explains the company on which the introduction
material is based on. It describes its enterprise structure in detail.
SAP University Alliances
Version 1.0
Authors Stephen TracyBret WagnerStefan Weidner
ProductSAP ERP
LevelBeginner
FocusGlobal Bike Inc.Integration
SAP ERP
SAP University Alliances
Page 1-38© 2008 SAP AG
Global Bike Incorporated
Company in the bicycle business
Initially buys and re-sells different lines of bicycles
Sells to both wholesale and Internet – procure and distribute
Later acquires a production facility to manufacture its own product – produce and distribute
SAP ERP
SAP University Alliances
Page 1-39© 2008 SAP AG
Core Business Processes
Global Bike Inc.
Sell – Sales and Distribution (SD)
Buy – Procurement (MM)
Plan – Production Planning (PP)
Make – Manufacturing Execution (PP)
Track – Financial Accounting (FI)
Track – Controlling (CO)
SAP ERP
SAP University Alliances
Page 1-40© 2008 SAP AG
Two Approaches of Learning
Standard Training- Level 1: Introductory
- Level 2: Business processes
- Level 3: Configuration
Business Process Integration Approach- Cross functional
- Understand business processes and their relationship to SAP's organizational structure
- Highlight integration/configuration
SAP ERP
SAP University Alliances
Page 1-41© 2008 SAP AG
Cross-functional integration
Source Unknown
SAP ERP
SAP University Alliances
Page 1-42© 2008 SAP AG
Process Integration
Sales Order Process
Sales OrderEntry Check
Availability
ProcurementProcess
Pick Materials
Purchase Requisition
Purchase Order
GoodsReceipt
InvoiceReceipt
Paymentto Vendor
Post Goods IssueInvoice
Customer
Receipt ofPayment
Run MRP
SAP ERP
SAP University Alliances
Page 1-43© 2008 SAP AG
Process Integration
Sales Order Process
Sales OrderEntry
Check Availability
ProcurementProcess
Pick Materials
Purchase Requisition
Purchase Order
GoodsReceipt
InvoiceReceipt
Paymentto Vendor
Post Goods IssueInvoice
Customer
Receipt ofPayment
Run MRP
SAP ERP
SAP University Alliances
Page 1-44© 2008 SAP AG
Process Integration
GoodsIssue
Sales Order Process
Sales OrderEntry
Check Availability
ProductionProcess
Run MPS w/MRP
Convert ProductionProposal Schedule
and ReleaseProcurement
Process
Pick Materials
Purchase Requisition
Purchase Order
GoodsReceipt
InvoiceReceipt
Paymentto Vendor
CompletionConfirmation
Goods Receipt
QualityInspection
Order Settlement
Post Goods Issue
Invoice Customer
Receipt ofPayment
SAP ERP
SAP University Alliances
Page 1-45© 2008 SAP AG
Process Integration
GoodsIssue
Sales Order Process
Sales OrderEntry
Check Availability
ProductionProcess
Run MPS w/MRP
Convert ProductionProposal Schedule
and ReleaseProcurement
Process
Pick Materials
Purchase Requisition
Purchase Order
GoodsReceipt
InvoiceReceipt
Paymentto Vendor
CompletionConfirmation
Goods Receipt
QualityInspection
Order Settlement
Post Goods Issue
Invoice Customer
Receipt ofPayment
SAP ERP
SAP University Alliances
Page 1-46© 2008 SAP AG
Enterprise Structure (Global Bike Inc.)
Plant
Client
Chart of Accounts
CompanyCode
Fiscal YearVariant
Credit ControlArea
PurchasingOrganization
Purchasing Group
Shipping Point
SalesOrganization
Distribution Channel
Division
Sales Area
Controlling Area
SL10 SL20
SAP ERP
SAP University Alliances
Page 1-47© 2008 SAP AG
SAP ERP
SAP University Alliances
Page 1-48© 2008 SAP AG
© 2008 SAP AG
Sales and Distribution (SD)
SAP University Alliances
Version 1.0
Authors Stephen TracyBret WagnerStefan Weidner
ProductSAP ERP 6.0Global Bike Inc.
LevelBeginner
FocusCross-functional integrationSales and Distribution
SAP ERP
SAP University Alliances
Page 1-50© 2008 SAP AG
Functionality
Sales Support
Sales
Shipping and Transportation
Billing
Credit Management
Foreign Trade
SAP ERP
SAP University Alliances
Page 1-51© 2008 SAP AG
Chapter Overview
Sales and Distribution Org. Levels
Sales and Distribution Master Data
Sales Order Process- Order-to-Cash
SAP ERP
SAP University Alliances
Page 1-52© 2008 SAP AG
Organizational Structure
S&D Structure
Client
Company Code
Sales Area- Sales Organization
- Distribution Channel
- Division
Plant
Shipping Point
Loading Point
Internal Sales Structure
Sales Offices
Sales Groups
Salesperson
SAP ERP
SAP University Alliances
Page 1-53© 2008 SAP AG
Structure for Sales Order Processing
Client 410
Company CodeC100
Plant P100 Plant P101
Sales Area
Sales OrgS100
DistributionChannel (RE)
Division(01)
SAP ERP
SAP University Alliances
Page 1-54© 2008 SAP AG
Internal Sales Structure
US Sales OfficeS100
Western SalesOffice
Northwest SalesGroup
Southwest SalesGroup
Salesperson 1
Eastern SalesOffice
Northwest SalesGroup
Southwest SalesGroup
Salesperson 2
Salesperson 3
Salesperson 4
Salesperson 5
Salesperson 6 Salesperson 7
Salesperson 8
Salesperson 9
SAP ERP
SAP University Alliances
Page 1-55© 2008 SAP AG
Structure for Distribution
Client 410
Company CodeC100
Plant P100 Plant P101
Shipping PointExpress Dock
Loading PointLP01
Shipping PointFreight Dock
Shipping PointRail Dock
Loading PointLP02
Loading PointLP03
SAP ERP
SAP University Alliances
Page 1-56© 2008 SAP AG
SD Master Data
Customer Master
Material Master
Sales Condition
SAP ERP
SAP University Alliances
Page 1-57© 2008 SAP AG
Customer Master Data
Customer Master- Contains all of the information
necessary for processing orders, deliveries, invoices and customer payment
- Every customer MUST have a master record
Created by Sales Area- Sales Organization- Distribution Channel- Division
SAP ERP
SAP University Alliances
Page 1-58© 2008 SAP AG
Customer Master Data
The customer master information is divided into 3 areas:
- General Data- Company Code Data- Sales Area Data
SAP ERP
SAP University Alliances
Page 1-59© 2008 SAP AG
Customer Master
Company Code 102Company Code 101
Company Code 100
Client 410
Sales Org. 101
Sales Org. 100
General Information relevant for the entire organization: Name Address Communication
Company Code specific information: Acc. Mgmt
Payment Bank
Sales Area specific information: Sales Office Currency
SAP ERP
SAP University Alliances
Page 1-60© 2008 SAP AG
Material Master Data
Material Master- Contains all the information a
company needs to manage about a material
- It is used by most components within the SAP system
• Sales and Distribution
• Materials Management
• Production
• Plant Maintenance
• Accounting/Controlling
• Quality Management
- Material master data is stored in functional segments called Views
SAP ERP
SAP University Alliances
Page 1-61© 2008 SAP AG
Material Master Views
Material Master
Basic Data
Sales Data
Controlling Data
Forecasting Data
Purchasing Data
Mat. Plan. Data
Accounting Data
Storage Data
Quality Data
SAP ERP
SAP University Alliances
Page 1-62© 2008 SAP AG
Material Master
Sales Org 102Sales Org 101
Sales Org 100
Client 410
Storage Location 20Storage Location 10
General Information relevant for the entire organization: Name Weight U/M
Sales specific information: Delivery Plant Loading Grp
Storage Location specific information: Stock Qty
SAP ERP
SAP University Alliances
Page 1-63© 2008 SAP AG
Customer Material Information Record
Data on a material defined for a specific customer is stored in a Customer material info record.
Info Records contain:- Customer-specific material
number- Customer-specific material
description- Customer-specific data on
deliveries and delivery tolerances
You can also maintain default text to appear on sales orders for that customer
SAP ERP
SAP University Alliances
Page 1-64© 2008 SAP AG
Condition Master (Pricing)
Condition master data includes:- Prices- Surcharges- Discounts- Freights- Taxes
You can define the condition master to be dependent on various data:
- Material specific- Customer specific
Conditions can be dependent on any document field
SAP ERP
SAP University Alliances
Page 1-65© 2008 SAP AG
Output
Output is information that is sent to the customer using various media, such as:
- E-mail- Mail- EDI- Fax- XML
Output examples:- Quotation- Confirmation- Invoice
SAP ERP
SAP University Alliances
Page 1-66© 2008 SAP AG
Sales Order Process
Sales OrderEntry
Post Goods Issue
Invoice Customer
Pick Materials
Receipt ofCustomer Payment
Pack Materials
Check Availability
Pre-salesActivities
SAP ERP
SAP University Alliances
Page 1-67© 2008 SAP AG
Pre-Sales Activities (CRM Light)
Sales Support is a component of SD that assists in the sales, distribution, and marketing of a companies products and services to its customers. It contains the following functionality:- Creating and tracking customer contacts and communications (sales
activity)• Phone call records• On-site meeting• Letters• Campaign communication
- Implementing and tracking direct mailing, internet, and trade fair campaigns based on customer attributes
Pre-sales documents need to be managed within the presales activities: Inquiries and Quotations. These documents help identify possible sales related activity and determine sales probability.
SAP ERP
SAP University Alliances
Page 1-68© 2008 SAP AG
Pre-Sales Activities (CRM Light)
The ultimate goal of all pre-sales activities is to equip the sales technician with all the information necessary to negotiate and complete the potential sale.
Information needed:- Past sales activity
- Past communication
- Contact information
- General Company info
- Credit limits and usage
- Current backorders
360º view of your customer
SAP ERP
SAP University Alliances
Page 1-69© 2008 SAP AG
Inquiry
An inquiry is a customer’s request to a company for information or quotation in respect to their products or services without obligation to purchase.- How much will it cost
- Material/Service availability
- May contain specific quantities and dates
The inquiry is maintained in the system and a quotation is created to address questions for the potential customer.
SAP ERP
SAP University Alliances
Page 1-70© 2008 SAP AG
Quotation
The quotation presents the customer with a legally binding offer to deliver specific products or a selection of a certain amount of products in a specified timeframe at a pre-defined price.
QuotationDATE February 25, 2008
123 Any Street Quotation # 20000001Battle Creek, MI 49015 Customer IDPhone (605) 555-1212 Fax (605) 555-1414
Bill To: Quotation valid until: June 4, 2008Prepared by: S. Tracy
1234 North MainKansas City, MO 64118(123) 555-1212
Comments or special instructions:
Quantity Description Unit Price AMOUNT
10 185.00 1,850.00
(5.00) (50.00)
5 269.00 1,345.00
- -
5.00% (157.25)
TOTAL 2,987.75$
If you have any questions concerning this quotation, contact: Steve Tracy(605) [email protected]
KB-0013-00
Discount
TB-0014-00
Discount
Total Discount
Heartland Bike Company
GBI
THANK YOU FOR YOUR BUSINESS!
SAP ERP
SAP University Alliances
Page 1-71© 2008 SAP AG
Sales Order
Sales order processing can originate from a variety of documents and activities- Customer contacts us for order: phone, internet, email
- Existing Contract
- Quotations
The electronic document that is created should contain the following basic information:- Customer Information
- Material/service and quantity
- Pricing (conditions)
- Specific delivery dates and quantities
- Shipping information
- Billing Information
SAP ERP
SAP University Alliances
Page 1-72© 2008 SAP AG
Sales Order
The sales document is made up of three primary areas:
- Header• Data relevant for the entire sales
order: Ex: customer data, total cost of the order
- Line Item• Information about the specific
product: Ex: material and quantity, cost of an individual line
- Schedule Lines• Uniquely belongs to a Line Item,
contains delivery quantities and dates for partial deliveries
SAP ERP
SAP University Alliances
Page 1-73© 2008 SAP AG
Sales Order
The sales order contains all of the information needed to process your customers request, the following information is determined for each sales order:- Delivering Schedule
- Shipping point and route determination
- Availability Check
- Transfer of requirements to MRP
- Pricing
- Credit limit check
SAP ERP
SAP University Alliances
Page 1-74© 2008 SAP AG
Delivery Scheduling
When an order is created the you must enter a requested delivery date for the order or each line item.
The system will then determine a delivery timeline, this will be used when determining our material availability, or ATP (Availability to Promise) date.
The system will determine this date using forward and backward scheduling rules you have defined.
SAP ERP
SAP University Alliances
Page 1-75© 2008 SAP AG
Backward Scheduling
RequestedDelv. Date
GoodsIssueLoading
MaterialAvailability
OrderDate
Transp.Sched.
TransitTime
(2 days)
LoadingTime
(1 day)
Pick & PackTime
(2 days)
Transp.Sched.Time
(1 day)
2nd 3rd 4th 5th 6th1st
SAP ERP
SAP University Alliances
Page 1-76© 2008 SAP AG
Forward Scheduling
TransitTime
(2 days)
LoadingTime
(1 day)
Transp.Sched.Time
(1 day)
NewDelv. Date
1st 3rd 4th 5th 6th 2nd
Pick & PackTime (2 days)
7th
RequestedDelv. Date
GoodsIssueLoading
MaterialAvailability
OrderDate
Transp.Sched.
SAP ERP
SAP University Alliances
Page 1-77© 2008 SAP AG
Shipping & Route Determination
During the creation of the sales order the system must determine the shipping point from which the material will be shipped and the route the material will take to get from your warehouse to your customers location.
A shipping point is determined for each line item within the order.
The route determination will is used to define the transit time of the material that we used in scheduling.
SAP ERP
SAP University Alliances
Page 1-78© 2008 SAP AG
Availability Check
Availability Check- Determines the material
availability date- Considers all inward and outward
inventory movements
Proposes 3 methods of delivery- One-time delivery- Complete delivery- Delayed proposal
Rules are created by YOU
SAP ERP
SAP University Alliances
Page 1-79© 2008 SAP AG
Transfer to Planning
The order is transferred to Material Requirements Planning as an (CIR) Customer Independent Requirement. If a deficit is found the system will propose a Purchase Req. or Order to fulfill the shortage.
SAP ERP
SAP University Alliances
Page 1-80© 2008 SAP AG
Pricing
The system displays pricing information for all sales documents on the pricing screens at both the header and the line item level.- Header pricing is valid for the whole order it is the cumulative of all line
items within the order
- Line item pricing is for each specific material.
The system will automatically search for price, discounts, surcharges, calculate taxes and freight. You have the ability to manually manipulate the pricing at both the header and line item level within the sales order by entering a condition type and amount.- Taxes and freight can be set-up so we can’t manually enter
SAP ERP
SAP University Alliances
Page 1-81© 2008 SAP AG
Credit Check
Allows your company to manage its credit exposure and risk for each customer by specifying credit limits.
During the sales order process the system will alert the sales rep about the customers credit situation that arises, if necessary the system can be configured to block orders and deliveries.
SAP ERP
SAP University Alliances
Page 1-82© 2008 SAP AG
Shipping & Transportation
The shipping process begins when you create the delivery document for the sales order. This document controls, supports, and monitors numerous sub-processes for shipping processing:- Picking
- Packing
- Post Goods Issue
Integrated with the Material Management (MM) and Finance (FI) modules
SAP ERP
SAP University Alliances
Page 1-83© 2008 SAP AG
Shipping
OrderCombination
Sales Order 1
Sales Order 2
Sales Order 3
Delivery 8…12
PartialDelivery
Sales Order 4
Delivery 8…13
Delivery 8…14
Delivery 8…15
CompleteDelivery
Sales Order 5
Delivery 8…16
SAP ERP
SAP University Alliances
Page 1-84© 2008 SAP AG
Delivery Creation
Checks order and materials to determine if a delivery is possible — delivery block (hold), completeness
Confirms availability
Confirms export/foreign trade requirements
Determines total weight & volume
SAP ERP
SAP University Alliances
Page 1-85© 2008 SAP AG
Delivery Creation
Generates packing proposal
Calculates weight and volume
Checks scheduling
Considers partial deliveries
Updates route assignment
Assigns picking location
Updates sales order
Determines batches
Quality check (if needed)
Updates sales order
SAP ERP
SAP University Alliances
Page 1-86© 2008 SAP AG
Delivery Document
The Delivery Document initiates the delivery process and is the control mechanism for this process- Picking
- Packing
- Loading
- Posting Goods Issue
Changes to delivery are allowable - products, quantities
SAP ERP
SAP University Alliances
Page 1-87© 2008 SAP AG
Picking
Quantities based on delivery note
Assigned date when picking should begin
Automated storage location assignment
Supports serial number/lot number tracking and batch management
Integrated with Warehouse Management (WM)
SAP ERP
SAP University Alliances
Page 1-88© 2008 SAP AG
Loading and Packing
Identifies which packaging is to be used for specified products (customer preference and UCC-128 considerations)
Identifies and updates accounts associated with returnable packaging
Tracks the packed product by container
Insures weight/volume restrictions are enforced
All packed items are assigned to the required means of transportation
SAP ERP
SAP University Alliances
Page 1-89© 2008 SAP AG
Goods issue
Event that indicates the legal change in ownership of the products
Reduces inventory and enters Cost of Goods Sold
Automatically updates the General Ledger (G/L) accounts
Ends the shipping process and updates the status of the shipping documents
SAP ERP
SAP University Alliances
Page 1-90© 2008 SAP AG
Billing
The billing document is created by coping data from the sales order and/or delivery document.- Order-based billing
- Delivery-based billing
The billing process is used to generate the customer invoice.
It will update the customer’s credit status.
SAP ERP
SAP University Alliances
Page 1-91© 2008 SAP AG
Billing Documents
The billing document will automatically create a debit posting to your customer sub-ledger account and credit your revenue account.
It is at this point that the sales process is passed over to Financial Accounting to await payment.
SAP ERP
SAP University Alliances
Page 1-92© 2008 SAP AG
Billing Methods
Collective Invoicing
Delivery based Invoicing
Delivery 8…34
Delivery 8…33
Order 14
Order 9
Delivery 8…56
Invoice 9…68
Order 6Delivery 8…20
Delivery 8…21
Invoice 9…45
Invoice 9…46
SplitInvoicing
Order 32 Delivery 8…86
Invoice 9…92
Invoice 9…91
SAP ERP
SAP University Alliances
Page 1-93© 2008 SAP AG
Payment
Payment is the final step in the sales order process, this step is managed by the Financial Accounting department.
Final payment includes:- Posting payments against invoices.
- Reconciling differences between payment and invoice.
Payment will create a posting clearing the liability in the A/R account and increases your bank account.
SAP ERP
SAP University Alliances
Page 1-94© 2008 SAP AG
Document Flow
The document flow and order status feature allows you to find the status of an order at any point in time. The SAP updates the order status every time a change is made to any document created in the customer order management cycle (Order-to-Cash).
SAP ERP
SAP University Alliances
Page 1-95© 2008 SAP AG
Sales Order Process Debugging
“Never again did I learn so much in such a short time, because twenty participants made mistakes for me! You cannot make so many mistakes all alone”
SAP Co-founder Klaus Tschira, on his experiences teaching COBOL to clients at IBM.
SAP ERP
SAP University Alliances
Page 1-96© 2008 SAP AG
Sales Order Process Debugging
Document Flow- Gives Order Process Status
List of Sales Orders (VA05)- Tool to Find Order - Need student’s user id/data set number
SAP ERP
SAP University Alliances
Page 1-97© 2008 SAP AG
Sales Order Process Debugging
SD1SD2SD3SD4SD5
SD6
© 2008 SAP AG
Materials Management (MM)
SAP University Alliances
Version 1.0
Authors Stephen TracyBret WagnerStefan Weidner
ProductSAP ERP 6.0Global Bike Inc.
LevelBeginner
FocusCross-functional integrationMaterials Management
SAP ERP
SAP University Alliances
Page 1-99© 2008 SAP AG
Functionality
Inventory Management
Purchasing
MRP
Physical Inventory
Valuation
Service Master
Invoice Verification
Product Catalogs
SAP ERP
SAP University Alliances
Page 1-100© 2008 SAP AG
Chapter Overview
Organization Structure
Master Data
Procurement Process- Procure-to-Pay Process
SAP ERP
SAP University Alliances
Page 1-101© 2008 SAP AG
Organizational Structure for Procurement
Client- An independent environment in the system
Company Code- Smallest org unit for which you can maintain a legal set of books
Plant- Operating area or branch within a company
• i.e. manufacturing facility or distribution facility
Purchasing Organization- The buying activity for a plant takes place at the purchasing
organization
Purchasing Group- Key that represents the buyer or group of buyers
SAP ERP
SAP University Alliances
Page 1-102© 2008 SAP AG
Purchasing Specific Structure
Purchasing Organization- Organization unit responsible for procuring services and materials
- Negotiates conditions of the purchase with the vendors
Purchasing Group- Buyer or group of buyers who are responsible for certain purchasing
activities
- Channel of communication for vendors
SAP ERP
SAP University Alliances
Page 1-103© 2008 SAP AG
Purchasing Organization / Group
Centralized vs. Decentralized
Purchasing
Purchasing Org100
Company Code100
Company Code101
Plant 100
Purchasing Org100
Purchasing Org100
Company Code100
Plant 100 Plant 101
SAP ERP
SAP University Alliances
Page 1-104© 2008 SAP AG
Structure for Procurement
Client 410
Company CodeC100
Plant P100 Plant P101
Purchasing OrgP100
Purchasing Group 100
Purchasing OrgP101
SAP ERP
SAP University Alliances
Page 1-105© 2008 SAP AG
MM Master Data
Vendor Master Data
Material Master Data
Purchasing Info Record
Output Master Data
Condition Master Data
SAP ERP
SAP University Alliances
Page 1-106© 2008 SAP AG
Vendor Master Data
Vendor Master- Contains all the necessary
information needed to business with an external supplier
- Used and maintained primarily by the Purchasing and Accounting Departments
- Every vendor MUST have a master record
SAP ERP
SAP University Alliances
Page 1-107© 2008 SAP AG
Vendor Master Views
Client Level- Address
- Vendor Number
- Preferred Communication
Company Code Data- Reconciliation Account
- Terms of Payment
- Bank Account
Purchase Org Data- Purchasing Currency
- Salesman’s Name
- Vendor Partners
General Data
Company Code DataFinancial Accounting (FI)
Purchasing DataMaterials Mgmt (MM)
SAP ERP
SAP University Alliances
Page 1-108© 2008 SAP AG
Vendor Master
Company Code 102Company Code 101
Company Code 100
Client 410
Purchasing Org. 101Purchasing Org. 100
General Information relevant for the entire organization: Name Address Communication
Company Code specific information: Acc. Mgmt
Payment Bank
Purchasing Org. specific information: Incoterms Currency
SAP ERP
SAP University Alliances
Page 1-109© 2008 SAP AG
Material Master Data
Material Master- Contains all the information a
company needs to manage about a material
- It is used by most components within the SAP system
• Sales and Distribution
• Materials Management
• Production
• Plant Maintenance
• Accounting/Controlling
• Quality Management
- Material master data is stored in functional segments called Views
SAP ERP
SAP University Alliances
Page 1-110© 2008 SAP AG
Material Master Views
Material Master
Basic Data
Sales Data
Controlling Data
Forecasting Data
Purchasing Data
Mat. Plan. Data
Accounting Data
Storage Data
Quality Data
SAP ERP
SAP University Alliances
Page 1-111© 2008 SAP AG
Material Master
Plant 102Plant 101
Plant 100
Client 410
Storage Location 20Storage Location 10
General Information relevant for the entire organization: Name Weight U/M
Plant specific information: Purchasing Data Work Sch.
MRP
Storage Location specific information: Stock Qty Picking
SAP ERP
SAP University Alliances
Page 1-112© 2008 SAP AG
Purchasing Information Record
Framework for Purchase Order- Contains the relationship
between a vendor and a material
Can be created:- Manually
- Automatically – Quotations
- Automatically – Pur Orders
Reporting- Vendor Evaluation
Material Master Vendor Master
PurchasingInformation Record
SAP ERP
SAP University Alliances
Page 1-113© 2008 SAP AG
Purchasing Information Record
Allows buyers to quickly determine:
- Which vendors have offered or supplied specific materials
Info Records contain:- Data on pricing and conditions- Last purchase order- Tolerance limits for deliveries- Specific lead times- Availability periods- Vendor Evaluation data
Serves as default information for Purchase Orders
SAP ERP
SAP University Alliances
Page 1-114© 2008 SAP AG
Master Data in Use
PurchaseOrder
45......01
Material Master Vendor Master
PurchasingInformation Record
SAP ERP
SAP University Alliances
Page 1-115© 2008 SAP AG
Procurement Process
Purchase Requisition
Paymentto Vendor
Notify Vendor
VendorShipment
InvoiceReceipt
GoodsReceipt
Purchase Order
VendorSelection
SAP ERP
SAP University Alliances
Page 1-116© 2008 SAP AG
Purchase Requisition
Internal Document instructing the purchasing department to request a specific good or service for a specified time
Requisitions can be created two ways:- Directly - Manually
• person creating determines: what, how much, and when
- Indirectly - Automatically• MRP, Production Orders, Maintenance Orders, Sales Orders
SAP ERP
SAP University Alliances
Page 1-117© 2008 SAP AG
Requisition Sourcing
Once the requisition has been assigned a source of supply it can be released for processing
There are a variety of ways that a purchasing department can process a requisition to determine the appropriate Source of Supply:- Internal Sourcing Requirements
- Source List
- Outlined Agreement
- RFQ
SAP ERP
SAP University Alliances
Page 1-118© 2008 SAP AG
Internal Sourcing
The requisition for materials could be satisfied by sources within our company.- It is possible that a plant within your firm could represent a potential
source of supply for the material needed (centralized warehouse)
- If an internal source is identified the requirement is covered by an internal procurement transaction (stock transport order)
SAP ERP
SAP University Alliances
Page 1-119© 2008 SAP AG
Source List
A source list is a record that specifies the allowed means for procuring a material for a certain plant within a given time period.- If the list contains a sole source the system will assign the vendor to
the requisition.
- If several options exist the system will display a list of vendors for you to choose from.
- If no source has been established the system will revert to search information records and outline agreements.
SAP ERP
SAP University Alliances
Page 1-120© 2008 SAP AG
Outline Agreement
Requisitions can be satisfied through existing longer-term purchasing agreement
These agreements are subdivided into:- Contracts
• Consists of items defining the individual materials, material groups, or services with prices and in many cases quantities
– Quantity
– Value
- Scheduling Agreements• Total quantity of material is spread over a certain period in a delivery
schedule, consisting of line items indicating quantities and their planned delivery date
SAP ERP
SAP University Alliances
Page 1-121© 2008 SAP AG
Request for Quotation
If nothing exist in the system we may need to submit a request for quotation to our vendors. An RFQ is an invitation to a vendor by a Purchasing Organization to submit a bid for the supply of materials or services- The accepted quotations will generate Purchasing Information Records
- Perform Quotation Price Comparisons
- Finally Select a Quotation
PurReq.
generateRFQ
Vendor 1
Vendor 2
Vendor 3
Quote
Quote
Quote
P.O.45…12
RejectLetter
Eval.
SAP ERP
SAP University Alliances
Page 1-122© 2008 SAP AG
Quotation from Vendor
The quotation received by your company is a legally binding offer, should decide to do business with the vendor, containing price’s and conditions for the materials specified in the RFQ for a predefined period of time.- In SAP the RFQ and the Quotation will be become a single document,
you will enter the vendor’s response in the RFQ you created.
SAP ERP
SAP University Alliances
Page 1-123© 2008 SAP AG
Vendor Evaluation once Identified
Vendor evaluation helps purchasing evaluate vendors for sourcing while also enabling the company to monitor vendor relationships through performance scores and criteria you put in place.
- Supports a maximum of 99 main criteria and 20 subcriteria for each main:• Price
– Price Level– Price History
• Quality– Goods Receipt– Quality Audit– Complaints/Rejection level
• Delivery– On-time delivery performance– Quantity reliability– Compliance with shipping instructions– Confirmation Date
- You then must establish a scoring range (1 -100) and determine the weight factors of scores for each.
SAP ERP
SAP University Alliances
Page 1-124© 2008 SAP AG
Purchase Order
A purchase order is a formal request to a vendor for a specific material or service under the stated conditions
Purchase Orders can be created manually- Reference a Purchase Order
- Reference a Purchase Requisition
- Reference a RFQ/Quotation
- Without Reference
Purchase Orders can be create automatically
SAP ERP
SAP University Alliances
Page 1-125© 2008 SAP AG
Purchase Order
A purchase order can be used for a variety of purposes, the item category (procurement type) defined in the PO will dictate the use of the order and the process that the order will follow:
- Standard• Stock or Consumption
- Services- Subcontracting- Third-Party- Consignment
SAP ERP
SAP University Alliances
Page 1-126© 2008 SAP AG
Purchase Order Structure
Header
Vendor DateDoc. Number CurrencyTerms of Payment PO Price
Item Overview
Materials Price/UofMQuantitiesDelivery Date
Line Item
PO History TolerancesLine PriceDelivery Schedule
PurchaseOrder
45......01
SAP ERP
SAP University Alliances
Page 1-127© 2008 SAP AG
Purchase Order Output
Once a Purchase Order has been created the vendor needs to be notified- Printed
- EDI
- Fax
- XML
There are a variety of forms that aid in the purchasing process and are generated from the Purchase Order- Purchase Order Output
- Order Acknowledgement Forms
- Reminders
- Schedule Agreements
SAP ERP
SAP University Alliances
Page 1-128© 2008 SAP AG
Goods Receipt
PurchaseOrder
45......01
Vendor
Notify Vendor
ShipmentGoods Receipt
SAP ERP
SAP University Alliances
Page 1-129© 2008 SAP AG
Goods Receipt
Goods movement in which we accept goods into our system
If materials are delivered against a Purchase Order we will reference that Order- Determine if we got what we ordered
- System can purpose data for us from the PO• Material, quantity
- Purchase Order History is update with the receipt
- Updates Physical Inventory
- Updates Inventory G/L Account
SAP ERP
SAP University Alliances
Page 1-130© 2008 SAP AG
Material Movements
When a goods movement takes place it is represented by a Movement Type- Movement types are three-digit keys used to represent a movement of
goods• 101 – goods receipt into warehouse• 103 – goods receipt into GR blocked stock• 122 – return delivery to vendor• 231 – consumption for a sales order• 561 – initial entry of stock
Destinations for Receipt of Goods- Warehouse – Unrestricted, Quality, Blocked
- Quality
- Goods Receipt Blocked Stock
SAP ERP
SAP University Alliances
Page 1-131© 2008 SAP AG
Effects of a Goods Receipt
When a Goods Movement for the receipt of goods takes place a series of events occur- Material Document is Created
- Accounting Document is Created
- Stock Quantities are Updated
- Stock Values are Updated
- Purchase Order is Updated
- Output can be generated (GR slip / pallet label)
SAP ERP
SAP University Alliances
Page 1-132© 2008 SAP AG
Invoice Processing
Incoming Invoices are reference against a Purchase Order to verify their content, prices, and arithmetic.
If discrepancies arise between the purchase order or goods receipt and the invoice the system with generate a warning or an error- Depending on system configuration the difference could cause the
system to Block the InvoicePurchase order
- Target quantity -- Target price -
Goods receipt - Actual quantity -
Invoice receipt- Actual price -
SAP ERP
SAP University Alliances
Page 1-133© 2008 SAP AG
Invoice Processing
When an invoice is saved it applies the liability from the Goods Receipt of our Purchase Order to a Vendor
Upon verification the:- Purchase Order is updated
- Material Master is Updated (MAP)
- Accounting Document is created
Once the Invoice has been posted the verification process is completed and the payment process is initiated within Financial Accounting
SAP ERP
SAP University Alliances
Page 1-134© 2008 SAP AG
Payment to Vendor
Can be done automatically or manually- Post Outgoing Payment vs. Payment Program
Elements of the Payment Transaction:- Payment Method
- Bank from which they get paid
- Items to be Paid
- Calculate Payment Amount
- Print Payment Medium
Process will create a financial accounting document to record the transaction
SAP ERP
SAP University Alliances
Page 1-135© 2008 SAP AG
Goods Receipt / Invoice ReceiptReconciliation Account
Purchase requisition
Purchase orderMaterials Management (MM) and Financial Accounting (FI)
via automatic account assignment
Goods receipt
No impact onFinancial Accounting (FI)
Dr Cr
Inventory
$100
Dr Cr
GR / IR
$100
SAP ERP
SAP University Alliances
Page 1-136© 2008 SAP AG
Goods Receipt / Invoice ReceiptReconciliation Account
Amount owed isassigned and transferred to
vendor account payableInvoice receipt
Dr Cr
Vendor A/P
$100
Dr Cr
GR / IR
$100
SAP ERP
SAP University Alliances
Page 1-137© 2008 SAP AG
Vendor Payment
Amount owed is paid tovendor and account payable
is reducedBank
Dr Cr
Vendor A/P
$100
Dr Cr
Bank
$100
SAP ERP
SAP University Alliances
Page 1-138© 2008 SAP AG
FI – MM Integration Point
Invoice Receipt
Payment Program
Goods Receipt
AP
(Vendor)Dr Cr
GR / IR
$100
BankDr Cr
Inventory
$100 $100 $100
Dr CrDr Cr
$100 $100
SAP ERP
SAP University Alliances
Page 1-139© 2008 SAP AG
© 2008 SAP AG
Production Planning & Execution (PP)
SAP University Alliances
Version 1.0
Authors Stephen TracyBret WagnerStefan Weidner
ProductSAP ERP 6.0Global Bike Inc.
LevelBeginner
FocusCross-functional integrationProduction PlanningProduction Execution
SAP ERP
SAP University Alliances
Page 1-141© 2008 SAP AG
Production Planning
SAP Divides Production into multiple processes- Production Planning
- Manufacturing Execution• Discrete Manufacturing• Repetitive Manufacturing• KANBAN
- Production – Process Industries• Integrated planning tool for batch-orientated process manufacturing• Design primarily for chemical, pharmaceutical, food and beverage
industries along with batch-oriented electronics
SAP ERP
SAP University Alliances
Page 1-142© 2008 SAP AG
Structure
Client
Company Code
Plants
Storage Locations
Work Center Locations
SAP ERP
SAP University Alliances
Page 1-143© 2008 SAP AG
PP Master Data
Materials
Bill of Materials (BOM)
Routings
Work Centers
Product Groups
SAP ERP
SAP University Alliances
Page 1-144© 2008 SAP AG
Material Master Record
SAP ERP
SAP University Alliances
Page 1-145© 2008 SAP AG
Bill of Materials (BOM)
List of components that make up a product or assembly
Frame
Pedal
Break Kit
Front Wheel- Front Rim- Front Tire- Front Tube
Rear Wheel- Rear Rim- Rear Tire- Rear Tube- Gear
Saddle - Post - Seat - Clip
Handle Bar - Bell - Clasp - Handle
SAP ERP
SAP University Alliances
Page 1-146© 2008 SAP AG
Bill of Materials (BOM)
Single-Level
Single-Level
Finished Bike
Front WheelFrame
Rear WheelPedal Kit
SaddleBrake Kit
Handle Bars
SAP ERP
SAP University Alliances
Page 1-147© 2008 SAP AG
Bill of Materials (BOM)
Single-Level vs. Multi-Level
Single-LevelFinished Bike
FrontWheel
RearWheel
RearRim
Multi-Level BOM
Frame Pedal BrakeHandle
BarsSaddle
RearTire
Tube
Gear
FrontRim
FrontTire
Tube
Single-Level
Bell
Clasp
HandleBar
Bell
Clasp
HandleBar
Single-LevelSingle-Level Single-Level
SAP ERP
SAP University Alliances
Page 1-148© 2008 SAP AG
Bill of Materials (BOM)
Variant Bill of Material (BOM)- Several products with a large proportion of identical parts.
Single-Level
Finished Bike
Front WheelGraphite Frame
Rear WheelPedal Kit
SaddleBrake Kit
Handle Bars
Single-Level
Finished Bike
Front WheelTubular Frame
Rear WheelPedal Kit
SaddleBrake Kit
Handle Bars
SAP ERP
SAP University Alliances
Page 1-149© 2008 SAP AG
BOM – Item Categories
Item Category- Stock Item
- Non-stock Item
- Variable Material – Sheet of steel
- Intra Item – Phantom material – process industry
- Class Item – place holder
- Document Item
- Text Item
SAP ERP
SAP University Alliances
Page 1-150© 2008 SAP AG
Routings
Routings enable you to plan the production of materials (products).
Routings are used as a template for production orders and run schedules
Routing are also used as a basis for product costing.
Series of sequential steps (operations) that must be carried out to produce a given product
Routings contain: - What, Where, When, How
SAP ERP
SAP University Alliances
Page 1-151© 2008 SAP AG
Routings
Routing – Operation 10- Explains the steps involved in this operation
BOM – Front Wheel, Rear Wheel and Frame- Outlines the components that will be consumed in the routing
Work Center – 00WC1- Identifies were the operations will take place and identifies the
business transaction to be carried
SAP ERP
SAP University Alliances
Page 1-152© 2008 SAP AG
Routings
Routing for Finished Bike
Operation
Work Center
Plant
Control Key
Description
Time and Unit of Measure
Activity Type
SAP ERP
SAP University Alliances
Page 1-153© 2008 SAP AG
Routing and BOM
Routing
Material Master – Finished Bike
BOM
Oper. 10
Oper. 20
Oper. 30
Front Wheel
Rear Wheel
Frame
Saddle
Handle Bars
Pedals
Component assignment in routing
Time
Op. 10
Op. 20
Op. 30
Front Wheel
Rear Wheel
Frame
Handle Bars
Saddle
Products arrive at the beginning of the operation to which they are assigned
Oper. 40
Oper. 50
Pedals
SAP ERP
SAP University Alliances
Page 1-154© 2008 SAP AG
Work Center
A location within a plant where value-added work (operations or activities) are performed
- Work Centers can represent• People or Groups of People
– Johnny Storm, Day Shift 1• Machines or Groups of Machines
– Ink Mixer, Ink Injection Machine• Assembly Lines
– Pen Assembly Line 2
Work center used to define capacities - Labor- Machine- Output- Emissions
Capacities used in- Capacity requirements planning (CRP)
Detailed scheduling
Costing
SAP ERP
SAP University Alliances
Page 1-155© 2008 SAP AG
Work Center
Work centers capture and use the following Resource Related data- Basic Data
• Person Responsible, Location of Work Center
- Scheduling Information• Queues and Move Times (interoperation), Formula Keys
- Costing Data• Cost Center, Activity Types
- Personnel Data• People, Positions, Qualifications
- Capacity Planning• Available Capacity, Formulas, Operating Time
- Default Data• Control Key, Standard Text Key
SAP ERP
SAP University Alliances
Page 1-156© 2008 SAP AG
Product Group
Aggregate planning that group together materials or other product groups (Product Families)
Multi- or Single- Level Product Groups- The lowest level must always consist of materials
Bikes
TouringMountain
24 Speed18 Speed 18 Speed 24 Speed
Red 24T Blue 24TRed 24M Blue 24M
SAP ERP
SAP University Alliances
Page 1-157© 2008 SAP AG
Material Planning
SOP provides a method for Sales Planning, Production Planning, Feasibility
Sales, Production, Inventory
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
4,000,000
Units
SalesProductionInventory
SAP ERP
SAP University Alliances
Page 1-158© 2008 SAP AG
Production Planning & Execution
DemandManagement
Forecasting
Sales & OperationsPlanning
SIS CO/PA
MPS
MRP
ManufacturingExecution
OrderSettlement
ProcurementProcess
Strategic Planning
Detailed Planning
Manufacturing Execution
SAP ERP
SAP University Alliances
Page 1-159© 2008 SAP AG
Production Planning & Execution
Players in the Game- Strategic Planning
• CEO, COO, CIO, CFO, Controller, Marketing Director
- Detailed Planning• Line Managers,
Production Scheduler, MRP Controller, Capacity Planners
- Execution• Line Workers,
Shop Floor Supervisors
DemandManagement
Forecasting
Sales & OperationsPlanning
SIS CO/PA
MPS
MRP
ManufacturingExecution
OrderSettlement
ProcurementProcess
Strategic Planning
Detailed Planning
Manufacturing Execution
SAP ERP
SAP University Alliances
Page 1-160© 2008 SAP AG
Forecasting
Forecasting is the foundation of a reliable SOP
Accurate forecasts are essential in the manufacturing sector
Overstocked & understocked warehouses result in the same thing: a loss in profits.
Forecasts are ALWAYS WRONG
SAP ERP
SAP University Alliances
Page 1-161© 2008 SAP AG
Forecasting
Forecasting Models- Trend
- Seasonal
- Trend and Seasonal
- Constant
Selecting a Model- Automatically
- Manually
SAP ERP
SAP University Alliances
Page 1-162© 2008 SAP AG
Planning Levels
Bikes
55%
Touring45%
Mountain
70%
24 Speed30%
18 Speed40%
18 Speed60%
24 Speed
50%
Red 24T50%
Blue 24T40%
Red 24M60%
Blue 24M
Planning at Product
Group Level
Planning at Material Level
SAP ERP
SAP University Alliances
Page 1-163© 2008 SAP AG
Sales and Operations Planning (SOP)
Information Origination- Sales
- Marketing
- Manufacturing
- Accounting
- Human Resources
- Purchasing
Intra-firm Collaboration- Institutional Common
Sense
SAP ERP
SAP University Alliances
Page 1-164© 2008 SAP AG
Sales and Operations Planning (SOP)
Flexible forecasting and planning tool
Usually consists of three steps:- Sales Plan
- Production Plan
- Rough Cut Capacity Plan
Planned at an aggregate level in time buckets
SAP ERP
SAP University Alliances
Page 1-165© 2008 SAP AG
Demand Management
Link between Strategic Planning (SOP) & Detailed Planning (MPS/MRP)
The results of Demand Mgmt is called the Demand Program, it is generated from our independent requirements - PIR and CIR
Bikes
55%
Touring45%
Mountain
70%
24 Speed30%
18 Speed40%
18 Speed60%
24 Speed
50%
Red 24T50%
Blue 24T40%
Red 24M60%
Blue 24M
Dis
agg
reg
ation
Product Groups
Material
SAP ERP
SAP University Alliances
Page 1-166© 2008 SAP AG
Demand Management
PlannedIndependent
Requirements
CustomerIndependent
Requirements
SalesForecast
DemandProgram
MPS / MRP
SAP ERP
SAP University Alliances
Page 1-167© 2008 SAP AG
Transfer from High Level to Detailed Planning
Bikes
55%
Touring45%
Mountain
70%
24 Speed30%
18 Speed40%
18 Speed60%
24 Speed
50%
Red 24T50%
Blue 24T40%
Red 24M60%
Blue 24M
Demand Planning
Data
Planning at Material Level
Disa
gg
regatio
n
Planned Independent Requirements
At Material and Plant Level
Transfer
Operative Planning
Data
Planning at Group Level
SAP ERP
SAP University Alliances
Page 1-168© 2008 SAP AG
Planning Strategies
Planning strategies represent the business procedures for- The planning of production quantities
- Dates
Wide range of strategies
Multiple types of planning strategies based upon environment- Make-To-Stock (MTS)
- Make-To-order (MTO)• Driven by sales orders
- Configurable materials• Mass customization of one
- Assembly orders
SAP ERP
SAP University Alliances
Page 1-169© 2008 SAP AG
Planning Strategy for Make-to-Stock
Planning takes place using Independent Requirements- Sales are covered by make-to-stock inventory
Strategies- 10 – Net Requirements Planning
- 11 – Gross Requirements Planning
- 30 – Production by Lot Size
- 40 – Planning with Final Assembly
SAP ERP
SAP University Alliances
Page 1-170© 2008 SAP AG
Planning Strategy for Make-to-Order
Planning takes place using Customer Orders- Sales are covered by make-to-order production
Strategies- 20 – Make to Order Production
- 50 – Planning without Final Assembly
- 60 – Planning with Planning Material
SAP ERP
SAP University Alliances
Page 1-171© 2008 SAP AG
Master Production Scheduling (MPS)
MPS allows a company to distinguish planning methods between materials that have a strong influence on profit or use critical resources and those that do not
Bike Set
FG-0010-00 GlovesHelmet
SaddleFrame Etc.Handle Bars
MPS run MPS Items
Non-MPS Items
SAP ERP
SAP University Alliances
Page 1-172© 2008 SAP AG
Material Requirement Planning (MRP)
In MRP, the system calculates the net requirements while considering available warehouse stock and scheduled receipts from purchasing and production
During MRP, all levels of the bill of material are planned
The output of MRP is a detailed production and/or purchasing plan
Detailed planning level- Primary Functions
- Monitor inventory stocks
- Determine material needs• Quantity• Timing
- Generate purchase or production orders
SAP ERP
SAP University Alliances
Page 1-173© 2008 SAP AG
Demand-Independent vs. Dependent
Independent Demand – Original source of the demand.
Dependent Demand – Source of demand resides at another level.
MPSBike Set
Planned Order
MPSFG-0010-00
MRPHelmet
Planned Order Purchase Order
MRPBrake Kit
Purchase Order
Dep Dep
Dep
Indep
Single-Level
Multi-Level
SAP ERP
SAP University Alliances
Page 1-174© 2008 SAP AG
Material Requirement Planning (MRP)
MRP is used to ensure the availability of materials based on the need generated by MPS or the Demand Program- 5 Logical Steps
• Net Requirements Calculation• Lot Size Calculation• Procurement Type• Scheduling• BOM Explosion
SAP ERP
SAP University Alliances
Page 1-175© 2008 SAP AG
Net Requirements
Procurement Proposal
Firmed Receipts
Firmed Orders or Purchase Requisitions
Requirements – Planned Ind. Req.,
ReservationsSales Orders,
Etc.
StockSafety Stock
Shortage
SAP ERP
SAP University Alliances
Page 1-176© 2008 SAP AG
Lot sizing
Static- Based on fixed values in the Material Master
Periodic- Groups net requirements together from multiple periods
Optimum- Calculates the optimum lot size for a several periods of net
requirements
SAP ERP
SAP University Alliances
Page 1-177© 2008 SAP AG
Procurement Type
External Procurement- Purchase Requisition
- Purchase Order
- Schedule Line
Internal Procurement- Planned Order
- Production Order
- Process Order
SAP ERP
SAP University Alliances
Page 1-178© 2008 SAP AG
Multi-Level Scheduling
Time
Finished Product
Assembly 1
Semi-Finished Good
Raw Material
Component
RequirementsDatePlanned Order
Purchase Requisition
SAP ERP
SAP University Alliances
Page 1-179© 2008 SAP AG
MRP vs. Consumption-Based
Whether or not a material is planned using MRP or Consumption Based is determined by the MRP Type on the MRP1 screen of the Material Master
MRP
VB – Reorder-Point
Consumption Based
VV – Forecast Based
RP – Replenishment
PD – MRP
VSD – Seasonal MRP
SAP ERP
SAP University Alliances
Page 1-180© 2008 SAP AG
Consumption-Based
Lot Size
Replenishment Lead Time
Safety Stock
Reorder Point
SAP ERP
SAP University Alliances
Page 1-181© 2008 SAP AG
Output of MRP
MRP
Planned Order
Convert to
In-HouseProduction
ProductionOrders
ProcessOrders
PurchaseRequisitions
PurchaseOrders
ScheduleLines
ExternalProcurement
SAP ERP
SAP University Alliances
Page 1-182© 2008 SAP AG
Orders, orders, orders
Planned Order (planning)- A request created in the planning run for a material in the future
(converts to either a production or purchase order)
Production Order (execution)- A request or instruction internally to produce a specific product at a
specific time
Purchase Order (execution)- A request or instruction to a vendor for a material or service at a
specific time
SAP ERP
SAP University Alliances
Page 1-183© 2008 SAP AG
Manufacturing Execution Process
Scheduleand Release
Shop FloorDocuments
Goods Receipt
Order Settlement
GoodsIssue
ProductionProposal
(Planning/Other)
CompletionConfirmation
Capacity Planning
SAP ERP
SAP University Alliances
Page 1-184© 2008 SAP AG
Production Order
Production orders are used to control production operations and associated costs- Production Orders define the following
• Material produced• Quantity• Location• Time line• Work involved• Resources used• How to costs are settled
SAP ERP
SAP University Alliances
Page 1-185© 2008 SAP AG
Production Order
BOM
How
What
Quantity
Time Line
SAP ERP
SAP University Alliances
Page 1-186© 2008 SAP AG
Schedule
Calculates the production dates and capacity requirements for all operations within an order- Determines a Routing
• Operation specific time lines• Material Consumption Points
- Material Master• Scheduling Margin Key (Floats)
- Work Center• Formulas• Standard Inter-operation Times
SAP ERP
SAP University Alliances
Page 1-187© 2008 SAP AG
Release
Two release processes- Header Level
• Entire order and all operations are released for processing, order is given a REL status
- Operation Level• Individual operations within an order are released, not until the last
operation is released does the order obtains a REL status until then it is in a PREL status
Automatic vs. Manual
SAP ERP
SAP University Alliances
Page 1-188© 2008 SAP AG
Availability Check
Automatic check to determine whether the component, production resource tools, or capacities in an order are available- Can be automatic or manually executed
- Determines availability on the required date
Generates an availability log- Displays results of the check
- Missing parts list
- Reservations that could not be verified
SAP ERP
SAP University Alliances
Page 1-189© 2008 SAP AG
Schedule & Release
The time between scheduling and releasing an order is used for company checks and any preparation needed for the processing of the order
Once an order has been released it is ready for execution, we can at this time- Print shop floor documents
- Execute goods movements
- Accept confirmations against the order
SAP ERP
SAP University Alliances
Page 1-190© 2008 SAP AG
Shop Floor Documents
Shop Floor Documents are printed upon release of the Production Order, examples would be:- Operation-based Lists
• Time Tickets, Confirmation Slips
- Component-based Lists• Material Withdrawal Slips, Pull List (consumption list)
- PRT Lists• Overview of PRT’s used and in which operations
- Multi-Purpose Lists• Operation Control Ticket, Object Overview
SAP ERP
SAP University Alliances
Page 1-191© 2008 SAP AG
Material Withdrawal
When a production order is created it references a BOM to determine the necessary components to produce the material, it then places a reservation on each of the components
Upon release of the order (or operation) you can withdraw the reserved materials from inventory- Reservation is updated
- Inventory is updated
- Costs are assigned to the order as actual costs
SAP ERP
SAP University Alliances
Page 1-192© 2008 SAP AG
Confirmations
Confirmations are used to monitor and track the progression of an order through its production cycle- Confirmation can be done at the operation or order level
Exact confirmation shortly after completion of an operation is essential for realistic production planning and control
Data that needs confirmation include- Quantities – yield, scrap, rework- Activity data – setup time, machine time- Dates – setup, processing, teardown started or finished- Personnel data – employee who carried out the operation, number of
employee involved in the operation- Work center- Goods movements – planned and unplanned- Variance reasons- PRT usage
SAP ERP
SAP University Alliances
Page 1-193© 2008 SAP AG
Confirmations
SAP ERP
SAP University Alliances
Page 1-194© 2008 SAP AG
Goods Receipt
Acceptance of the confirmed quantity of output from the production order into stock- Effects of the Goods Receipt
• Updates stock quantity• Updates stock value• Price stored for future valuation changes• Production order is updated
- Three documents are created• Material document• Accounting document• Controlling document
SAP ERP
SAP University Alliances
Page 1-195© 2008 SAP AG
Order Settlement
Consists of settling the actual costs incurred in the order to one or more receiver cost objects- Receivers could include: a material, a cost center, an internal order, a
sales order, a project, a network, a fixed asset
Parameters for Order Settlement- Settlement Profile
• Specifics the receivers, distributions rules and method
- Settlement Structure• Determines how the debit cost elements are assigned to the settlement
cost elements
Settlement Rule- Automatically assigned on creation of order, the parameters are used
to define this rule• Has one or more distribution rules assigned to it• Distribution rules defines: cost receiver, settlement share, settlement type
SAP ERP
SAP University Alliances
Page 1-196© 2008 SAP AG
Order Settlement
Settling a Production Order to Stock- Debt posting is made to the Production Order with the value of the
material
- Difference between the debt posting and credit posting is posted to a price difference account
Material Prod. Order Price Diff.
100 2080
**Material Price determine by the quantity produced times the Standard Price in the Material Master.
SAP ERP
SAP University Alliances
Page 1-197© 2008 SAP AG
Order Settlement
Costs analyzed- Primary
• Materials• External Processing
- Secondary• Production, Material, and Administrative Overhead• Labor
Cost Analysis Reporting- Calculate and analyze planned costs, target costs, and actual costs of
the production order.
- Calculate and analyze variances
SAP ERP
SAP University Alliances
Page 1-198© 2008 SAP AG
Order Settlement
SAP ERP
SAP University Alliances
Page 1-199© 2008 SAP AG
Order Status
© 2008 SAP AG
Financial Accounting (FI)
SAP University Alliances
Version 1.0
Authors Stephen TracyBret WagnerStefan Weidner
ProductSAP ERP 6.0Global Bike Inc.
LevelBeginner
FocusCross-functional integrationFinancial Accounting
SAP ERP
SAP University Alliances
Page 1-201© 2008 SAP AG
Goal of FI
Financial accounting is designed to collect the transactional data that provides a foundation for preparing the standard portfolio of reports
In general, these reports are primarily, but not exclusively, directed at external parties
Standard reports include:- Balance Sheet
- Income Statement
- Statement of Cash Flows
SAP ERP
SAP University Alliances
Page 1-202© 2008 SAP AG
Target Audience
Internal- Executives
- Senior Management
- Administrative Staff
- Employees
External- Legal Authorities
- Banks
- Auditors
- Shareholders
- Insurance
- Taxing Authorities
- Media
- Financial Analysts
SAP ERP
SAP University Alliances
Page 1-203© 2008 SAP AG
Organizational Objects
These represent the legal and/or organizational views of an enterprise
They form a framework that supports the activities of a business in the manner desired by management
Permit the accurate and organized collection of business information
Support the development and presentation of relevant information in order to enable and support business decisions
Organizational Objects:- Company Code
- Chart of Accounts
SAP ERP
SAP University Alliances
Page 1-204© 2008 SAP AG
Company Code
Represents an independent legal accounting unit
Balanced set of books, as required by law, are prepared at this level
A client may have more than one company code- United States
- United Kingdom
- South America
- Canada
- GermanyLiabilities &
Owners EquityAssets
SAP ERP
SAP University Alliances
Page 1-205© 2008 SAP AG
Chart of Accounts
A classification scheme consisting of a group of general ledger (G/L) accounts.
A chart of accounts provides a framework for the recording of values to ensure an orderly rendering of accounting data.
The G/L accounts it contains are used by one or more company codes.
SAP ERP
SAP University Alliances
Page 1-206© 2008 SAP AG
General Ledger (G/L) Accounts
The unique combination of Company Code and Chart of Account creates a data storage area called a General Ledger
The General Ledger contains a listing of the transactions effecting each account in the Chart of Accounts and the respective account balance
It is utilized in the preparation of financial accounting statements
SAP ERP
SAP University Alliances
Page 1-207© 2008 SAP AG
Posting a G/L Entry
SAP ERP
SAP University Alliances
Page 1-208© 2008 SAP AG
G/L Account Summary
Account number 100100 Bank AccountCompany code 00A1
Period Debit Credit DC bal. Balance C/f bal. 750,000.00 Period 1 5,250.00 3,540.00 1,710.00 751,710.00 Period 2 25,000.00 15,000.00 10,000.00 761,710.00
SAP ERP
SAP University Alliances
Page 1-209© 2008 SAP AG
Balance Sheet
Presentation of an organization’s Assets, Liabilities, and Equity at a point in time
Assets: What the company owns
Liabilities: What the company owes
Equity: The difference between Assets and Liabilities
Assets = Liabilities + Equity
SAP ERP
SAP University Alliances
Page 1-210© 2008 SAP AG
Balance Sheet – Sample
AssetsCash 1,000Accounts Receivable 3,000Equipment 500
Total Assets 4,500
LiabilitiesAccounts Payable 750Taxes Payable 250
Total Liabilities 1,250
EquityCommon Stock 2,000Retained Earnings 250
Total Equity 2,250
Total Liabilities and Equity 4,500
SAP ERP
SAP University Alliances
Page 1-211© 2008 SAP AG
Income Statement
Presentation of an organization’s Revenues and Expenses for a given period of time (e.g., monthly, quarterly, or yearly)
Revenues, in a simple sense, are inflows of cash as a result of selling activities or the disposal of company assets
Expenses, in a simple sense, are outflows of cash or the creation of liabilities to support company operations
Revenues - Expenses = Net Income
SAP ERP
SAP University Alliances
Page 1-212© 2008 SAP AG
Income Statement – Sample
RevenueSales 11,000Deductions 750
Total Revenue 10,250
Operating ExpensesCost of Goods Sold 4,500Operating Expenses 3,750
Total Expenses 8,250
Net Income Before Taxes 2,000Taxes 750Net Income 1,250
SAP ERP
SAP University Alliances
Page 1-213© 2008 SAP AG
Statement of Cash Flows
Considers the associated changes, both inflows and outflows, that have occurred in cash – arguably the most important of all assets – over a given period of time (e.g., monthly, quarterly, or annually)
SAP ERP
SAP University Alliances
Page 1-214© 2008 SAP AG
Customer and Vendor Accounts
Customer and Vendor account balances are maintained in FI through fully integrated accounts receivable and accounts payable sub-modules
Financial postings for Customers and Vendors are made directly to their respective individual accounts and accompanied by a concurrent automatic posting to the General Ledger
SAP ERP
SAP University Alliances
Page 1-215© 2008 SAP AG
Customer Accounts
Accounts Receivable Sub-Module- Information with respect to Customers who purchase the enterprise’s goods and
services such as sales and payments made- Substantive and important integration between Sales and Distribution (SD) and
FI- Billings in SD generate FI journal entries for sales activity
Accounts Receivable(General Ledger)
950
300
Customer 142
150
Customer 123
400
Customer 135
100
Customer 189
SAP ERP
SAP University Alliances
Page 1-216© 2008 SAP AG
Vendor Accounts
Accounts Payable Sub-Module- Information with respect to Vendors from whom the enterprise purchases goods
and services such as purchases and payments made- Substantive and important integration between Materials Management (MM)
and FI- Purchase and goods receipt activities in MM generate FI journal entries
Accounts Payable(General Ledger)
850
250
Vendor 100435
200
Vendor 100234
100
Vendor 100621
300
Vendor 100846
SAP ERP
SAP University Alliances
Page 1-217© 2008 SAP AG
Accountants and Audit Trails
Audit trails allow an auditor to begin with an account balance on a financial statement and trace through the accounting records to the transactions that support the account balance
Audit trails enable an auditor to trace individual transactions to the effected account balance(s) on a financial statement
SAP ERP
SAP University Alliances
Page 1-218© 2008 SAP AG
SAP Document Principle
Each business transaction impacting FI writes data to the SAP database creating a uniquely numbered electronic document
The document number can be used to recall the transaction at a later date
It contains, for example, such critical and necessary information as:- Responsible person- Date and time of the transaction- Commercial content
Once written to the SAP database, a financial document (one impacting the financial position of the company) can not be deleted from the database
It can be changed to some degree
The SAP document principle provides a solid and important framework for a strong internal control system – a requirement of law for companies that operate in the United States
SAP ERP
SAP University Alliances
Page 1-219© 2008 SAP AG
SAP Document Principle
Period 1Doc. no. DT Doc.date Currency Amount 1500000013 KZ 01/05/04 USD 1,800.00 -1500000014 KZ 01/06/04 USD 990.00 -100000012 SA 01/08/04 USD 750.00 -1400000342 DZ 01/14/04 USD 5,250.00 -
SAP ERP
SAP University Alliances
Page 1-220© 2008 SAP AG
SAP FI Module
Fully integrated with other SAP modules including, but not limited to:- Sales and Distribution (SD)- Materials Management (MM)- Production Planning and Execution (PP)- Managerial Accounting (CO)
SAP ERP
SAP University Alliances
Page 1-221© 2008 SAP AG
Summary
Purpose
SAP FI Organizational Objects
Financial Statements
Customer/Vendor Accounts
Audit Trails
Document Principle
Integration
SAP ERP
SAP University Alliances
Page 1-222© 2008 SAP AG
SAP ERP
SAP University Alliances
Page 1-223© 2008 SAP AG
© 2008 SAP AG
Controlling (CO)
SAP University Alliances
Version 1.0
Authors Stephen TracyBret WagnerStefan Weidner
ProductSAP ERP 6.0Global Bike Inc.
LevelBeginner
FocusCross-functional integrationControlling
SAP ERP
SAP University Alliances
Page 1-225© 2008 SAP AG
Goal of CO
Managerial accounting – termed controlling – is designed to collect the transactional data that provides a foundation for preparing internal reports that support decision-making within the enterprise
These reports are exclusively for use within the enterprise and include:- Cost center performance
- Profit center performance
- Budgets analyses
SAP ERP
SAP University Alliances
Page 1-226© 2008 SAP AG
Target Audience
Executives
Senior Management
Department Managers
Controllers
Cost Accountants
SAP ERP
SAP University Alliances
Page 1-227© 2008 SAP AG
Organizational Objects
These represent the legal and/or organizational views of an enterprise
They form a framework that supports the activities of a business in the manner desired by management
Permit the accurate and organized collection of business information
Support the development and presentation of relevant information in order to enable and support business decisions
Organizational Objects:- Company Code - Cost Center- Chart of Accounts - Internal Order- Controlling Area - Profit Center
SAP ERP
SAP University Alliances
Page 1-228© 2008 SAP AG
Company Code
Represents an independent legal accounting unit
Balanced set of books, as required by law, are prepared at this level
A client may have more than one company code- United States
- United Kingdom
- South America
- Canada
- GermanyLiabilities &
Owners EquityAssets
SAP ERP
SAP University Alliances
Page 1-229© 2008 SAP AG
Chart of Accounts & Controlling Area
Chart of Accounts- A complete listing of the accounts that exist in the General Ledger for
a company
- Since a given enterprise (e.g., General Motors) can consist of several separate legal entities (e.g., Cadillac, Chevrolet), separate company codes can be created for each entity while each uses the same chart of accounts so that consolidated statements can be prepared.
Controlling Area- A self-contained, organizational element for which the management of
revenues and expenses can be performed
- A controlling area may include one or more company codes; therefore, an enterprise can perform management accounting analyses and reports across several companies
- A way to identify and track where revenues and costs are incurred for evaluation purposes
SAP ERP
SAP University Alliances
Page 1-230© 2008 SAP AG
Profit Center & Cost Center
Profit Center- Responsible for revenue generation and cost containment- Evaluated on profit or return on investment - Enterprises are commonly divided into profit centers based on
• Region• Function• Product
Cost Center- Responsible for cost containment, not responsible for revenue
generation• One or more value-added activities are performed within each cost center• Unit that is distinguished, for example, by area of responsibility, location, or
type of activity• Copy center• Security department• Maintenance department
SAP ERP
SAP University Alliances
Page 1-231© 2008 SAP AG
Internal Order
Temporary cost center responsible for cost containment, not responsible for revenue generation
It is used to plan, collect, and monitor the costs associated with a distinct short-term event, activity, or project- Company picnic
- Trade show
- Recruiting campaign
SAP ERP
SAP University Alliances
Page 1-232© 2008 SAP AG
Revenue Elements
A one-to-one linkage (mapping) between General Ledger revenue accounts and CO revenue elements is established to permit the transfer of FI revenue information to CO
Posting in FI that impact revenue accounts lead to an posting in CO to a revenue element
In other words, revenue account = revenue element – just different words depending on whether FI object or CO object
SAP ERP
SAP University Alliances
Page 1-233© 2008 SAP AG
Cost Elements
A one-to-one linkage (mapping) between General Ledger expense accounts and CO cost elements is established to permit the transfer of FI expense information to CO
Postings in FI that impact cost accounts lead to an posting in CO to a cost element
In other words, expense account = cost element – just different words depending on whether FI object or CO object
Primary Cost Element- Originate in the General Ledger within FI and are automatically transferred to
CO when an FI transaction is recorded in the General Ledger
Secondary Cost Element- Used exclusively in CO for allocations and settlements between and amongst
cost centers
SAP ERP
SAP University Alliances
Page 1-234© 2008 SAP AG
Primary and Secondary Cost Elements
FinancialAccounting
(FI)
General Ledger Accounts
RevenueAccounts
BalanceSheet
Income Statement
ExpenseAccounts
ManagerialAccounting
(CO)
Aggregate Cost Elements
Primary CostElements
Secondary CostElements
SAP ERP
SAP University Alliances
Page 1-235© 2008 SAP AG
Posting Primary Cost Element
Primary Cost Element
Debit Credit
1,500
CostCenter
A
Debit Credit
1,500
Supplies Expense Cash
Financial Accounting (FI)
Managerial Accounting (CO)
SAP ERP
SAP University Alliances
Page 1-236© 2008 SAP AG
Posting Primary Cost Element
(FI) TransactionDocument
AmountG/L Account #Cost Center1900012432
(CO) Transaction Document
Cost Center Cost Element
20000657
1,5001,500
Cash Debit Credit
Supplies ExpenseDebit Credit
Cost Center
1,500
Financial Accounting (FI)
Managerial Accounting (CO)
SAP ERP
SAP University Alliances
Page 1-237© 2008 SAP AG
Posting Secondary Cost Element
Secondary Cost Element
Debit Credit
1,500
Debit Credit
1,500
Supplies Expense Cash
CC 2
CC 3
CostCenter
A
Financial Accounting (FI)
Managerial Accounting (CO)
SAP ERP
SAP University Alliances
Page 1-238© 2008 SAP AG
Statistical Key Figures
Provide the foundation for accurate and effective cost allocations between cost objects
Utilized to support internal cost allocations involving allocations, assessments, and distributions
Examples: number of employees, square footage, minutes of computer usage
Copy CenterActivity
(20 Hours)
10 Hours
6 Hours
4 Hours
Executive Offices
MaintenanceDepartment
Information ServicesDepartment
SAP ERP
SAP University Alliances
Page 1-239© 2008 SAP AG
Posting Secondary Cost Element
Debit Credit
1,500
Rent Expense
Debit Credit
2,500
Supplies Expense
Debit Credit
2,000
Labor Expense
1,500
2,500
2,000
1,800
3,000
1,200
Primary Cost Element
Primary Cost Element
Primary Cost E
lement
Sec. Cost E
lement
Sec. Cost Element
Sec. Cost Element
Copy Center
Executive Offices
Information Services
Maintenance Department
SAP ERP
SAP University Alliances
Page 1-240© 2008 SAP AG
Types of Allocation
Distributions – primary cost elements
Assessments – combination of primary and/or secondary cost elements
Distribution- Method for periodically allocating primary cost elements- Primary cost elements maintain their identities in both the sending and receiving
objects- Sender and receiver cost centers are fully documented in a unique Controlling
(CO) document
Assessment- A method of allocating both primary and secondary cost elements- Primary and/or secondary cost elements are grouped together and transferred
to receiver cost centers through use of a secondary cost element- Sender and receiver cost centers are fully documented in a unique Controlling
(CO) document
SAP ERP
SAP University Alliances
Page 1-241© 2008 SAP AG
Distributions
A010 – 600 sq ft
A005 – 400 sq ftD010 – 550
sq ft
D005 – 900 sq ft
S010 – 100 sq ft
S005 – 200 sq ft
A020 – 100 sq ft
A015 – 150 sq ft
Sendingcost center
Primary cost elementmaintains its identity
Receivingcost centers
A010 – AdministrationRent Expense
$1,500Distribution
SAP ERP
SAP University Alliances
Page 1-242© 2008 SAP AG
Distributions
A015 $75A020
$50S005 – $100
S010 – $50
A010 – $300
D005 – $450
D010 – $275
A005 – $200
A010 – AdministrationRent Expense
$1,500Distribution
Sendingcost center
Primary cost elementmaintains its identity
Receivingcost centers
SAP ERP
SAP University Alliances
Page 1-243© 2008 SAP AG
Assessments
A020 – 0%
A005 – 15%
A010 – 5%
A015 – 10%
S005 – 30%S010 – 10%
D005 – 20%
D010 – 10%
A020 – ITSoftware Expense
$4,200
A020 – ITSupplies Expense
$500
Assessment
Sendingcost center Primary and
secondary cost elements
Receiving cost center
SAP ERP
SAP University Alliances
Page 1-244© 2008 SAP AG
Assessments
S010 – $470
D010 – $470A005 – $705
A010 – $235
A015 – $470
A020 –$0
S005 – $1,410
D005 – $940
A020 – ITSoftware Expense
$4,200
A020 – ITSupplies Expense
$500
Sendingcost center
Primary and secondary cost elements
Receiving cost center
Assessment
SAP ERP
SAP University Alliances
Page 1-245© 2008 SAP AG
SAP CO Module
Fully integrated with other SAP modules including, but not limited to:- Financial Accounting (FI)- Materials Management (MM)- Sales and Distribution (SD)- Production Planning and Execution (PP)
SAP ERP
SAP University Alliances
Page 1-246© 2008 SAP AG
Summary
Purpose
SAP CO Organizational Objects
Revenue Elements
Cost Elements
Statistical Key Figures
Allocations
Integration
SAP ERP
SAP University Alliances
Page 1-247© 2008 SAP AG
The End