Material Valuation Control, Stock Types, Consumable Materials, Blanket Purchase Order, Service Procuremrnt (Service Entry Sheet)
👉In SAP, we can do material valuation either at company code level or at plant level.
If we do material valuation at Company Code Level, so system will add all the stock and show you the total value for the materials, which is there in the system.
But if you maintain the Material Valuation at Plant level, so plant-wise system will show you the valuation for the available stock.
👉So, While the Goods Receipt in a system, then what will happen? Whenever you are receiving some material in the system, so what will happen in a system?
Material Document & Accounting Document✔
Material Document --> Update the Quantity Stock in the system.
Accounting Document --> Updates the Value.
👉 So, In valuation control, there are two types of prices, okay. Whenever you are creating some material. So, In accounting one view tab, so there is option called Price Control, okay. So, either you can select Standard Price as a "S" or you can select the Moving Average Price as a "V" , okay.
So, Such an example in both case, the accounting interest will be different.
In case of Standard Price, if the price has become changed, so price difference accounts comes into the picture, okay.
But even in case of Moving Average Price, the price is changed. So there is no price difference account. The updated price will be updated in the stock account only.
👉 So, It's simple, whenever we are creating purchase order. We share this purchase order with vendor and what vendor will do, vendor will send the material to the company. So whenever the material send to our warehouse or a storage location, a storage person will receive the material, correct, means you are doing the Goods Receipt, okay. So, but whenever you are doing the Goods Receipt, So at that time, we will have three options, okay, We can get that material in an unrestricted stock, blocked stock or a quality stock.
👉 But the question is, What is meant by Blocked, Unrestricted or a Quality Stock ?
✔Unrestricted --> So Unrestricted Stock means Good stock or we can say ready to use. If any particular department needs this particular material, XYZ material and those material is in Unrestricted. So, It means we can provide the material because of quality is good or ready to use material. this is called as Unrestricted, there is no restriction on this material or no restriction on the stock, okay. So this is called as Unrestricted Stock.
✔Blocked --> Blocked stock means bad quality, bad quality due to any reason, due to some damage, damage material, okay. So we can receive that material in a blocked quality, or we have blocked that some kind of stock.
✔Quality --> Quality Inspection Stock, means, In most of the companies before receiving the material they are inspecting it, okay. So if they want to send all the material in a Quality Inspection Stock, so they will receive in a Quality Inspection Stock.
So Unrestricted means Good Stock, Blocked Stock means bad quality of material or a damage material, which is not going to use, okay, for the bad quality we can either send back to the vendor due to some any reason, okay, we can send out to the to the vendor for the replacement purpose, okay. This kind of Stock we can manage in Blocked Stock and those material which you have to do the Quality Test, so we can receive in a Quality Inspection Stock. So in SAP MM, we have three types of stock, Unrestricted, Blocked and Quality.
Let me take one example and show you how you can receive it, okay, so the important thing is this 101 moment type. Now what is mean by moment type, moment type means, and what is meant by 101.
Let me create purchase order quickly. I have created some purchase order for a particular material, then what is the next step, I will share this parchase order with vendor and vendor will send the material to the company, and what company will do, company will receive the material, okay, so let me receive the material, against this purchase order, okay. Now here you can see, what is good received 101, what is meant by this 101 ?
So, 101 is nothing but the Movement type, so whenever you are transferring the material from one place to another place, so in SAP it's the functionality called as a Movement type. how you are moving the material from where are you moving, from where to where, so for each movement there is a movement type which will be defined by the SAP, okay.
Now 101 means Goods Receipt for purchase order into your warehouse, It means if you want to receive the material against the purchase order into your storage location, okay.
Now 102 means, when we will use 102, Goods Receipt for the purchase order into your house the reversal, It means if you want to return the material, okay.
Now 201 means is nothing but what, consumption of center from the warehouse, If any department needs some material, so they will use 201 moment type, it means they are going to consume that material, so in that case we will use 201 moment type, okay.
👉**The transaction code for Checking Stock in SAP?**
I need to check the stock, MMBE, okay, so it's MMBE. I need to check, I have received this stock, correct, 62 quantity in a quality inspection stock. So I need to check, enter the material number, enter the plant number and enter the storage location number, in this plant, in this storage location, I need to check the stock.
So, The stock type present in the SAP MM, okay, three types of stock. Unrestricted, block and quality, you can select whenever you are posting the GR with 101 moment type.
👉 What two types of material, one is the Stockable material which we are having, some quantity basis, we are managing in a quantity basis, in our storage location and they are having some values, okay. Because we need to calculate it in a material valuation (ROH, FERT, Semi-Finished).
But for the departments, we are ordering some materials which is going to be consumed by the departments and that material is nothing but Consumable Material, okay.
👉 NLAG Material is set to quantity update or track the quantity but no value update and it is included in a Purchase Order with account assignment.
👉 UNBW Means there is some quantity we can maintain in our storage location but that having some zero value.
So, this is nothing but two types of consumable material, NLAG (Non-Stock Material) and UNBW (Non Valuated Material) , okay, so this is all about consumable material.
Account Assignment
The second Terminology is Account Assignment Category.
Actually there are different types of Account Assignments are there, okay. Asset is there, Cost Center is there, Project is there, Order is there and Sales Order is there, okay. So from MM perspective, we will use the Account Assignment category as a Cost Center.
Actually what happened, whenever you are procuring the consumable material, whenever you are creating purchase order or a PR, so you have to enter the account assignment means we need to enter some department, okay, which department is responsible for buying this material, it is raised from the cafeteria department or it is raised by the production department. so we need to enter some department number, so department is nothing but cost center, now what is meant by cost center, cost center is nothing but department. and who is creating this cost center, finance people is creating the cost center, okay, from MM perspective, department is called as a Purchasing. But since you know that our MM is integrated with FICO module, okay, so whenever we are buying the Consumable Material, so we have to enter the Cost Center, means Department.
So whenever you are creating purchase order or this thing, so we have to enter the cost center number, so that management will come to know that, which department is responsible for buying this material, okay. So that is what Account Assignment is. So, whenever you are buying the consumable material, so you have to select the Account Assignment Category.
A means asset, K means cost center, from mm perspective, we will enter the cost center, so we will select the account assignment as a K, okay.
Account Assignment A will be used by finance team,
K will be used by MM side,
Project - P & F will be used by PS (Project System) consultant, sales order will be used by SD consultant, okay.
So, If the other module want to use the Account Assignment, so they are having their own account assignments, module ones, okay, so from MM perspective, we have to enter the cost center number, we select the account assignment as a K and enter the cost center number like (3000,4000,5000).
**Without material master we can procure consumable material. we can save the purchase order, do the GR as it is and we can do the Invoice also.
So, Consumable Material you can procure without material master also.
👉So What is the difference between stock material and consumable material ?
So, for stock material, material master is mandatory, with material master only you can procure this stockable material,
but in case of consumable material, so without material also you can buy or with material master also you can buy this, okay, in stockable material account assignment.
In Stock Material Account Assignment is optional or automatic account assignment data from material master,
but In Consumable Material we have to enter Account Assignment Category or manual account assignment.
Stock Account will be hit in case of Stock Material and Consumable Account will be hit in case of Consumable Material.
🖥 Tutorial 👉 https://youtu.be/wolO04TYVaQ?si=6ZaO41DDfuBIVsmX
👉 Blanket Purchase Order will be always used for buying the consumable material Ok You can create the blanket purchase order or a framework order. Both are same Blanket Purchase Order / framework order will be always used for procuring in the consumable material.
👉 For Blanket Purchase Order you have to select the document type as FO (Framework PO) & Item Category as B
👉 What is the definition of Item Category ?
--> Item category defines what type of procurement you are doing in your company.
👉 What is the function of item category ?
--> item category defines the procurement type what kind of procurement you are doing in your company.
👉 While creating PO type of Frame work order, system will ask for Validity Start and Validity End. Because I have select Framework order to create PO. Framework Order is nothing but Blanked Purchase Order which have some specific time period. It can be for 3 months 2 months or we can say 6 month, 1 year , 5 year. whatever it maybe.
👉 SAP Supplier Relationship Management (SRM) gives enterprises for goods procurement through a web-based platform. It also integrates with SAP enterprise resource planning (ERP) or other management systems to share vital information with accounting and project managers.
👉 Activity number is nothing but the service master number.
👉 Service Entry Sheet will be created with respect to Purchase Order.
👉 IR - Share IR with Finance for Payment to vendor with respect to Service Entry Sheet.
🖥 Tutorial 👉 https://youtu.be/tsf4t0dLM7k?si=qyPkU2nw5CnB0yvF