ABC Textile India LTD

ABC Textiles India Ltd.
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1. Introduction 2. Company 3. Company codes 4. Plants 5. Business Areas 6. Basic settings of Accounting 6.1 Financial year 6.2 Posting period variant 6.3 Open posting periods 6.4 Field status variant 6.5 Tolerance groups 7. Postings 7.1 Document types 7.2 Document number range interval 8. General Ledger Accounting 8.1 Chart of Accounts 8.2 Account groups 8.3 Retained earnings Account 8.4 G/L Master records 9. Bank Accounting 10. Cash Journal 11. Terms of Payments 12. Interest settings 13. Dunning procedure 14. Down Payments Made/Received 15. Withholding Tax 16.Tax on Sales and Purchases
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17. Accounts Receivable 17.1 Credit control area 17.2 Sales Areas 17.3 Customer Account Groups 17.4 Customer Master records 17.5 Customer Billing 17.6 Customer payments 17.6 Special G/L transactions 18. Accounts Payable 18.1 Purchase Organizations 18.2 Vendor Account groups 18.3 Vendor Master records 18.4 Invoicing 18.5 Invoice Clearing 18.6 Special G/L transactions 18.7 Automatic Payment Program 19. Asset Accounting 19.1 Asset classes 19.2 Acquisition of Assets with/without vendor and retirement of Assets 19.3 Depreciation Keys 20. Information System 20.1 External Reports 20.2 Internal Reports 21. Controlling 21.1 Cost Element Accounting 21.2 Cost Center Accounting 21.3 Product Cost Controlling 22. Information System
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AS-IS 1. Organizational Structure Group Company ABC TEXTILES(India) Limited is a Group of Companies having two companies. Companies ABC TEXTILES(India) Limited consists of two Companies. 1. AP Cotton Limited, Hyderabad. 2. AP Mlange Limited, Hyderabad. Manufacturing Units AP Cotton Limited, consists of two manufacturing units 1. 100% Cotton Group 2. 100% Polyester Group A.P. Mlange Limited Consists of one manufacturing unit. 3. 100% Cotton & Viscose Blends 100% Polyester Blends 2. Books of Accounts 2.1 Books of Accounts are maintained by ATIL with Financial year April to March in Indian Rupees. TO-BE
In SAP Company can be created with a six-character code. Transaction Code: OX15. In SAP a four character Company Code can be created for each Company. Transaction Code: OX02. Company Codes are assigned to Company. T.C.:OX16 In SAP Plants can be created with a four character code. T.Code:OX10 Plants are assigned to their respective Company Codes T.Code:OX18
Fiscal Year variant can be maintained for the Financial Year and assigned to Company Codes. Fiscal Year Variant consists 12 periods starting from April to March. 4 special periods can be maintained for closing purpose. T.Code: OB29, OB37. Currency codes can be maintained in T.Code:OY03
2.2Currencies Currencies with which ATIL is dealing with Indian Rupees, USD
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Opening and closing of Books In every financial year books are opened on 1st of April and closed on 31st March Books are closed in every month and balances are carried forward to next month 2.4Journal Day to day transaction is recorded in journals. Separate journals are maintained for cash, sales day book, sales returns purchase day book, purchase returns 2.5General Ledgers General ledger accounts are maintained under various heads like Capital, liabilities, assets, income expenditure, creditors and debtors ledger In SAP periods can be opened and closed by using posting period variant and assigned to Company Codes. T.Code:OBBO, OB52, OBBP
In SAP document types classify transactions. A Document number identifies each journal entry. Document number intervals are assigned to Number range of document types in company code OBA7, FBN1 In SAP a Chart of Accounts can be created which contains list of G/L Accounts. Under the Chart of Accounts, G/L accounts are classified under Account groups. T.Code OBD4 Share Capital Reserves & Surplus Secured Loans & Unsecured Loans Current Liabilities & Provisions Fixed Assets Investments Current Assets Loans & Advances Incomes Expenses GL Master Records G/L Master record is maintained for each General Ledger account. Each G/L master is recognized by a number. T.Codes: FS00
3.Bank Accounting Bankers: ATIL is banking with SBI, AB and ICICI.
In SAP, a House bank can be maintained
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3.1 ABC TEXTILES(India) Limited is having two accounts 1. SBI, Dilsuknagar (Open Cash Credit Account) 2. Current accounts with AB AP Melange Limited has one Current account with ICICI Bank. All receipts and payments from foreign trade are accounted with ICICI Bank. Bank reconciliation is done manually at the end of every month. 3.2 Cash books Cash books are maintained to record the cash receipts and Payments. for each bank account. T. Code FI12,FF68
In SAP Cash Journals can be maintained for cashbooks. T.Code:
4. Terms of Payment 30 days Credit facility is In SAP Terms of Payment are maintained provided to customers. Discount in T.Code:OBB8 2 % is allowed to customers for payments realized within 10 days and 3 % is allowed to customers for payments realized within 20 days. For some customers, installment facility is given. Materials are procured from vendors on 30 days credit 5. Reminder Notices Weekly reminders are sent to In SAP, Dunning procedure can be created customers with regard to for sending reminder notices. overdue more than Rs.50000/T.Code: FBMP Fortnightly reminders are sent to customers with regard to overdue less than Rs.50000/Yearly once Balance confirmation statement is sent to vendors.
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Remainder Notice charges will be charged. Interest notice send to the customers on overdue. 6. Interest Calculation As per the Company Policy, interest is calculated @ 24% pa on the balance overdue. 7. Withholding Tax As per the Income Tax Act 1961, TDS is deducted on service related payments under the following categories. Salaries Dividends Interest payments Contract payments Rent Professional & Technical fees Quarterly Returns are submitted to the Tax Department In SAP, Interest Indicators can be created for each type of Interest. T.Code:OB46 In SAP, Withholding Tax types and Withholding Tax codes can be maintained for each category of Withholding Tax.
In SAP, Remittance challans can be created in T.Code: J1INCHLN
At the Year End, TDS certificates In SAP. Withholding Tax certificate can be are issued to the concerned parties created in T.Code: J1INCERT from whom the TDS is made. When customer makes TDS, it is not accounted until receipt of certificate. Up to that time it is shown as outstanding against certificate. In the year-end TDS certificates are obtained from the customers.
8.Tax on Sales & Purchases: Excise Duty Payable / Paid Customs Duty Payable / Paid CESS Payable VAT Payable / Paid CST Payable
In SAP, Account key is created for each Tax. Tax procedure is created and assigned to country India. Tax codes are created with the percentage of Taxes. T.Code: OBCN, OBYZ, OBQ3, OBBG, FTXP
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9.Accounts Payable Account Payable General Ledger accounts is maintained for each Vendor as a sub ledger accounts. Materials are procured from domestic vendors as well as imports.
In SAP, an account group can be created for regular vendors and one time vendors. A vendor master record is maintained for each vendor. Vendor master record is recognized by a number from the number range interval and assigned to account group.
Advances are paid to vendors for In SAP, advance to parties are done goods delivered. through special GL transactions Invoices are received after delivery of goods. Invoices are settled as per the Invoices can be created in T.Code: MIRO terms and conditions. Payments are made through Cheques, Bills Payable, Cash 10. Accounts Receivable Account Receivable General Ledger account is maintained for each Customer as a sub ledger accounts Types of customers Domestic and Exports Creating invoices to customers House banks are maintained for each Bank and cheque lots can be maintained for outgoing cheques. In SAP, an account group can be created for regular customers and one time customers. A customer master record is maintained for each vendor Customer master record is recognized by a number from the number range interval and assigned to account group. In SAP invoices can be created in T.Code: VF01 In SAP a House bank is maintained for each Bank account for receivable purpose and
Payment methods accepted By the ATIL from customers: Cheques, Bills Receivable cash
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In SAP an asset class can be created for each head. Asset class consists of Assets are grouped under the account determination, number range and following heads screen layout. Land and buildings G/L master record is created for each Plant and machinery asset class. EDP equipment Vehicles Furniture and fixtures An asset master is created for each asset. Depreciation method Each asset master is recognized by a Assets consist of useful life. During number. the life some wear and tear will occur, so we calculate depreciation IN SAP chart of depreciation can be for each fixed assets To calculate created and assign to company code the depreciation we follow Written down value method. Method of depreciation and Rates of depreciation is provided in depreciation keys T.codes: EC08, OADB, OAOA, AO90, AFAMA, AO21, ASO1, F-90.
11.ASSET MANAGEMENT
12. Reports External reports 1. Profit and loss account for year 2. Profit and loss account half yearly or quarterly 3. Balance sheet actual / actual year 4. Cash flow statement In SAP these are standard reports available
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1. Introduction ABC TEXTILESINDIA LIMITED (ATIL) is established in the year 1995, it is a Yarn Manufacturing Facility with different kind of End Products, like 100% Cotton, 100% Polyester and Mlange yarn to cover the market demand of different areas and needs. Our enterprise is present globally by exporting our products to many countries also have a healthy share in Domestic Market. We have a very strong Quality and Environment policies, we posses the ISO9002: 2000 and ISO-14001 certifications. Our enterprise is the only one of its kind with winner of Best exporter of the year award continuously for past Six (6) years, and Installed spindle capacity of over 70,000, And 14.6 million kgs of output per annum with over Rs. 1.76 billions turn over per annum. Company has 150 crores equity share capital divided into 15 crores equity shares. 2. Company ABC TEXTILES(India) Limited is a Group of Companies having two company codes. A Company is created with a six-digit character code with the information of address, language, currency and country. The Company is used for the consolidation of financial results of the companies within the group. Company ATIL Transaction Code: OX15. 3. Company Codes A four character Company Code is created for each Company. AP Spinner (India) Limited consists of two Company Codes 3. AP Cotton Limied at Hyderabad Company Code APCL 4. AP Melange Limited at Hyderabad Company Code APML Transaction Code: OX02. Company Codes are assigned to Company. Transaction Code: OX16.
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4. Plants AP Cotton Limited consists of two manufacturing units. Plants are created with a four-character code. 1. 100% Cotton Mills 2. 100% Polyester Mills Code APCM Code APPM
AP Melange Limited consists of one manufacturing unit 1. 100% Cotton & Viscose Blends Mills 100% Polyester Cotton Blends Mills Code APMM Transaction Code: OX10. Plants are assigned to their respective Company Codes Transaction Code: OX18. 5. Business Areas ABC TEXTILES(India) Limited is into 3 market segments. Cotton Yarn, Polyester Yarn and Cotton, Viscose, Polyester Blends. Three Business areas are created for internal reporting purpose Business Areas APC APP APM 100% Cotton Yarn 100% Polyester Yarn 100% Cotton, Viscose and Polyester Blends Transaction Code: OX03
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6. Basic Settings of Accounting Books of Accounts are maintained by the Company with Financial year April to March. 6.1 Fiscal Year variant is maintained for the Financial Year. Fiscal Year Variant consists 12 periods starting from April to March. 4 special periods can be maintained for closing purpose. Fiscal year variant AP is used Transaction Code: OB29 Fiscal Year variant AP is assigned to both the Company Codes Transaction Code: OB37 6.2 Posting period variant In every financial year books are opened on 1st April and closed on 31st March. Books are closed in every month and balances are carried forward to next month. So, Posting period variant is created. Posting Period VariantATIL is used Transaction Code: OBBO Posting period variant is assigned to Company Codes. Transaction Code: OBBP 6.3 Open posting periods Periods are opened for the fiscal year through the posting period variant Transaction Code: OB52
6.4 Field Status Variant Field Status Variant is copies from standard SAP with 47 field status groups. Field Status group defines the status of the fields while making posting to the GL accounts.
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Field status variant APSL Transaction Code: OBC4
Field Status variant is assigned to Company Codes. Transaction Code: OBC5 6.5 Tolerance Groups Tolerance group for GL Account is created in each Company Code. In Tolerance groups the permissible amounts for accounts and for line items are specified Transaction Code: OBA0 Tolerance group for employees is created in each Company Code. This group defines different amount limits for your employees. It determines: The maximum amount for which an employee is permitted to post a document. The maximum line item amount an employee is permitted to enter in a customer, vendor or general ledger account. The percentage amount related to cash discount. The maximum permitted payment differences. Transaction Code: OBA4 Tolerance group for (vendor / customer) is created for each company code. In the tolerance group limits for vendor / customer payment differences are defined. The tolerance group determines: Limits to which differences in payments are posted automatically to expense or revenue accounts when clearing open items Terms of payments are used for settle the invoices. Transaction Code: OBA3 7. Postings Every transaction is recorded in Journal at the first and separate journals are maintained for cash, sales day book, sales returns, purchase day book, purchase returns. Standard SAP Document Types are used to classify the transactions.
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Document number intervals are maintained for each document type. From this number interval, system picks and assigns a number to each transaction in SA.
Doc.type SA AA AB DR KR DZ KZ DG DA KG KA AF
No. Range GL account document 01 Asset accounting 01 document Reversed clearing 01 document Customer invoice 18 Vendor invoice 19 Incoming payment 14 Outgoing payment 15 Customer memos 16 Reversal/Clearing Doc. 16 of customers Vendor memo 17 Reversal/Clearing Doc. 17 of vendor Depreciation posting 04 Description
No. Intervals From To 100000 200000 300000 400000 500000 600000 700000 800000 199999 299999 399999 499999 599999 699999 799999 899999
Document type Number intervals
Transaction Code:OBA7 Transaction Code: FBN1
Posting Keys Standard posting keys defined in SAP are used 8. General Ledger Accounting General ledger accounts are maintained under various heads like Capital, Liabilities, Assets, Income, Expenditure, Creditors and Debtors ledger Preparations
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8.1 Chart of Account consists list of GL accounts and two company codes will be maintained with seperate Chart of Accounts. Chart of accounts defines the language, length of GL accounts and its helps to integration with Controlling. Chart of Account: APCL & APML Chart of accounts is assigned to Company Codes. Transaction Code:OB62 8.2 Account groups The following account groups are created for the Chart of Accounts APCL Acc. Group SC10 RS11 SU12 CL15 FA20 IN21 CA22 LA26 IC30 EX40 From Account 100000 110000 120000 150000 200000 210000 220000 260000 300000 400000 To Account 109999 119999 149999 199999 209999 219999 259999 299999 399999 499999 Transaction Code:OB13
COA APCL APCL APCL APCL APCL APCL APCL APCL APCL APCL
Description Share Capital Reserves & Surplus Secured and Unsecured Loans Current Liabilities & Provisions Fixed Assets Investments Current Assets Loans & Advances Incomes Expenses
The following account groups are created for the Chart of Accounts APML Acc. Group SC10 RS11 SU12 CL15 FA20 IN21 CA22 From Account 100000 110000 120000 150000 200000 210000 220000 To Account 109999 119999 149999 199999 209999 219999 259999
COA APML APML APML APML APML APML APML
Description Share Capital Reserves & Surplus Secured and Unsecured Loans Current Liabilities & Provisions Fixed Assets Investments Current Assets
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APML APML APML LA26 IC30 EX40 Loans & Advances Incomes Expenses 260000 300000 400000 299999 399999 499999
Transaction Code:OBD4 8.3 Retained earnings One retained earnings account is created with GL account 110000 and P&L statement account type X. Transaction Code:OB53 8.4 GL Master Records G/L Master record is maintained for each General Ledger account. Each G/L master record is recognized by a number and text. GL master record consists of two segments chart of account segment and company code segment. Transaction Code: FS00, OBY7, OBY2
9. Bank Accounting House bank of a company code is denoted as a bank ID every account specfies by an account ID in the SAP system. In the SAP system, use the bank ID and the account ID to specify bank details. These specifications are used to determine the bank details for payment. Bankers: ATIL dealing with SBI, AB and ICICI. AP Cotton Limited is maintaining two accounts SBI, Dilsuknagar (Open Cash Credit Account) Current accounts with AB,Somajiguda AP Melange Limited has one Current account with ICICI Bank
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One House bank is created for each bank account. Co. code House bank APCL APCL APCL APCL APML APML Bank Key SBIAPCL ABAPCL ICAPML Description SBI Bank AB Bank ICICI Bank Bank acc.no SBI001 AB001 ICICIML GL account 121000 222000 223000
Transaction Code: FI12 10. Cash Journal: The cash journal a sub ledger of Bank Accounting. It is used to manage record the cash receipts and payments. The Company would be maintaining two Cash Books, One is for the Main Cash and other is for Petty Cash Book. By setting the cash balance at the beginning of the day, the cash journal shows the cash balance at any time by adding the cash receipts and deducting the cash payments. The cash journal also serves as a basis for entries in the general ledger and thereby represents the "Cash" G/L account.
Settings for Cash journal 1. GL account for Cash journal 220500 2. Document type for Cash journal SA (General Accounting Document) 3. Number Range Intervals-01: 1 - 999999 Transaction Code: FBCJC1 4. Set up Cash Journal 5. Create Bank transactions 6. Set up print parameters 7. Postings to cash journal is made through 11. Terms of Payment Transaction Code: FBCJC0 Transaction Code: FBCJC2 Transaction Code: FBCJC3 Transaction Code: FBCJ
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Terms of Payments contains conditions framed between the business partners to settle the invoices and it specifies about the due date of amount payable. Based on time cash discount can be availed. It defines cash discount rate for an individual payment with a maximum of 3 payment terms i.e. first cash discount period, second cash discount period and due date for net payment. Terms of Payment are attached to vendor/Customer master records or document postings, system automatically calculates the cash discount while posting the document. In SAP Terms of payments are attached to customer or vendor. 30 days Credit facility is provided to customers. Discount 2 % is allowed to customers for payments realized within 10 days and 3 % is allowed to customers for payments realized within 20 days. For some customers, installment facility is given. Terms of payment 0001 Payable Immediately APSL 30 Days credit Transaction Code: OBB8
Payment Terms for installments APSI Installment Payments Transaction Code:OBB9 12. Interest Settings Interest Calculation: As per the Company Policy, interest is calculated @ 8% p.a. on the balance overdue. Company has taken working capital loans from their bankers for which they are paying interest @ 9% p.a Account balance interest or Interest on arrears can be calculated on customer as well as vendor accounts Balance interest calculates interest on balance amounts periodically where as Item interest calculates interest for the overdue or delayed days of payments
Standard Interest Calculation Types available P: Item Interest S: Balance Interest
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Z: Penal Interest Interest Indicators CI: Balance Interest Indicator MI: Item Interest Indicator Transaction Code: OB46 Reference Interest rates APS1: Reference Interest @ 8% APS2: Reference Interest @ 9% Transaction Code: OBAC Time based terms CI: Term Debit Interest: Balance Interest calculation CI: Term Credit Interest: Balance Interest calculation MI: Term Debit Interest: Arrears Interest calculation MI: Term Credit Interest: Arrears Interest calculation Transaction Code: OB81 13. Dunning Procedure The dunning procedure determines how business partners can be dunned. It contains the number of dunning levels, dunning frequency, minimum amounts and dunning activities. Dunning Level indicates how often an item or an account has been dunned and describes the steps to be maintained for a dunning procedure. Dunning levels control the dunning process. Dunning Area is an organizational unit within a company code from which dunning is conducted. The dunning procedure is controlled and the dunning notices are sent separately per dunning area. A dunning area can represent the following:

Business Area Sales Organization Distributon Channele Division Dunning Notices
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Weekly reminders are sent to customers with regard to overdue more than Rs.50000/Fortnightly reminders are sent to customers with regard to overdue less than Rs.50000/Yearly once Balance confirmation statement is sent to vendors. Dunning charges will be charged. Interest notice send to the customers on overdue Dunning procedure:ATIL Dunning Interval in days: 7 Dunning levels: 4 Minimum amount for dunning: INR 50000 Dunning charges: INR 100 to 500 Transaction Code: FBMP
14. Down Payment made/received Down payments are used for short or medium financing. Generally the vendor or manufacturer does not have to pay interest on down payments. Down payments are generally made before production begins or after partial completion. Down Payments must be displayed separately in the Balance Sheet. On the balance sheet, down payments made are displayed on the assets side and down payments received on the liabilities side. Down Payments made are futher divided, depending on whether they are a. Down Payments on Tangible Fixed Assets b. Down Payments on Intangible Fixed Assets c. Down Payments on Inventory stocks d. General Down Payments.
15. Withholding Tax As per the Income Tax Act 1961, TDS is deducted on service related payments under the following categories. Salaries, Dividends, Interest payments, Contract payments, Rent, Professional & Technical fees Quarterly Returns are submitted to the Tax Department
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At the Year End, TDS certificates are issued to the concerned parties from whom the TDS is made. When customer makes TDS, it is not accounted until receipt of certificate. Up to that time it is shown as outstanding against certificate. In the year-end TDS certificates are obtained from the customers. Withholding Tax types and Withholding Tax codes are maintained for each category of Withholding Tax.
Withholding tax types 01: TDS on Payment posting 02: Surcharge on TDS 03: Cess on TDS 04: Higher Education Cess 05: Cess on Surcharge 06: TDS on Invoice posting Withholding tax codes W.Tax W.Tax Type Code 01 01 02 03 04 05 06 01 02 01 01 01 01 01 Description (TDS on) Salaries Contract payments Surcharge on TDS Cess on TDS Higher E.Cess Cess on Surcharge TDS on Invoice posting Off W.Tax Key 192 194C % Posting Subject Indicator to tax (Std) 100 1 100 3 2 2 2 100 1 1 1 1 1 1 W.Tax rate Income Type
2% 10 % 3% 1% 3% 2%
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Remittance challans are created in Withholding Tax certificates are created in 16. Taxes on Sales & Purchases The following are the Taxes, which the company is paying on Sales and Purchases Sales Output Tax: Excise duty payable, Customs Duty, CESS payable, VAT payable, CST payable Purchases Input Tax: Excise duty paid, Customs Duty Paid, CESS paid, VAT paid, CST paid. Transaction Code: J1INCHLN Transaction Code: J1INCERT
Tax on sales and purchases are procedure-based taxation in FI component. Condition Types: Condition Types APS5 APS6 APS7 APS8 APS9 APS0 APS1 APS2 APS3 APS4 Description Excise Duty Paid Cess Paid VAT Paid CST Paid Customs Duty Paid Customs Duty Payable Excise Duty Payable Cess Payable VAT Payable CST Payable Transaction Code: OBQ1 Account Keys A/c Key SL5 SL6 SL7 SL8 SL9 SL0 Description Excise Duty Paid Cess Paid VAT Paid CST Paid Customs Duty Paid Excise Duty Payable Type Input Tax Input Tax Input Tax Input Tax Output Tax Output Tax Not Deductible X 2 2 3 2 3 2 Posting Indicator
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SL1 SL2 SL3 SL4 Cess Duty Payable VAT Payable CST Payable Customs duty Payable Output Tax Output Tax Output Tax Output Tax X 2 2 2 2
NOTE: 2 Separate Line Items 3 Distributed to relevant expenses / revenue items Transaction Code: OBCN
Tax Procedure A calculation procedure is defined for each country INDIA, containing the specifications required to calculate and post tax on sales/purchases. Calculation procedure contains tax types, which are called condition types in the procedure. The system defaults condition types when you define a tax code. The condition type (such as input or output tax) specifies the base amount on which the tax is calculated and the account key that is used to post the tax. The specifications necessary for calculating and posting tax have been defined for the condition type and account key. Tax Procedure ATIL Step 10 100 110 120 130 140 200 210 220 230 240 Condition Type BASB APS5 APS6 APS7 APS8 APS9 APS0 APS1 APS2 APS3 APS4 Description Excise Duty Paid Input Tax Cess Paid- Input Tax VAT paid-Input Tax CST Paid Input Tax Customs Duty Paid- Input Tax Excise Duty Payable-Output Cess Payable-Output Tax VAT Payable-Output Tax CST Payable Output Tax Customs Duty Payable Output Tax From 10 100 10 10 10 10 200 10 10 10 To Account Key SL5 SL6 SL7 SL8 SL9 SL0 SL1 SL2 SL3 SL4
100 110 110
200 210 210
Transaction Code: OBQ3
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Tax procedureATIL is assigned to country India. Transaction Code: OBBG Tax Codes The tax code represents a tax category, which must be taken into consideration when making a tax return to the tax authorities. Tax codes are unique per country. The tax rate calculation rules and further features are stored in a table for each tax code.
Tax Code I0 I1 I2 I3 O0 O1 O2 O3
Description Input Tax Exempted Customs Duty Excise + Cess + VAT Excise + Cess + CST Output Tax Exempted Customs Duty Excise + Cess + VAT Excise + Cess + CST
Tax Type V V V V A A A A Transaction Code: FTXP
Rates of Tax Tax Customs Duty Excise Duty Cess VAT CST Rate of Tax (Percentage) 8 16.5 2 12.5 3
17.Accounts Receivable The Accounts Receivable application component records and manages accounting data of all customers. It is also an integral part of sales management. All postings in Accounts Receivable are also recorded directly in the General Ledger. Credit Control Area: Central Credit Control Area is responsible for granting and monitoring credit to the customers.
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Credit Control Area Code ATIL Transaction Code: OB45
Company Codes APCL and APML are assigned to credit control areaATIL. Transaction Code: OB38 Sales Areas Customer Account Groups Account Group SLDC SLFC SLOT Description Domestic Customers Foreign Customers One time Customers Transaction Code: OBD2 Number range for customer account groups Account group SLDC SLFC SLOT Number range SD SF SO From 10000 20000 30000 Number interval To 19999 29999 39999 Transaction Code: XDN1 Number ranges are assigned to customer account groups. Transaction Code: OBAR Customer Master Record Customer master record is maintained for each customer. Each customer master record is recognized by number. Customer Masters: Customer Master record consists of three segments, general data, company code data and sales area data. Transaction Code: FD01, XD01 Customer Billing Customer billing is done through the following steps:
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Sales order T. Code: VA01 Outbound Delivery T.Code: VL01N Billing a Document T.Code: VF01
Integration with SD GL accounts are assigned to condition types in transaction code VKOA Customer Payments Payments are accepted from customers through Cheque, Bills Receivable and Cash. Document type DZ is used to make payments. Incoming payments are made through T.Code: F-28 Special GL Transactions Advances from customers are treated as Special GL transactions Special GL indicators A Down payments F Down payment request Transaction Code: OBXR 18. Accounts Payable The Accounts Payable application component records and manages accounting data for all vendors. It is also an integral part of the purchasing system: Deliveries and invoices are managed according to vendors. Purchase organization Vendor Account Groups Account Group VIND Description Domestic Vendors
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VIMP VEMP VOTV VSTAT Foreign Vendors Employees One time Vendors Statutory Vendors Transaction Code:OBD3 Number range for vendor account groups Account group VIND VIMP VEMP VOTV VSTAT Number range V1 V2 V3 V4 V5 From 50000 60000 70000 80000 90000 Number interval To 59999 69999 79999 89999 99999 Transaction Code: XKN1 Number ranges are assigned to vendor account groups. Transaction Code: OBAS Vendor Master Records A Vendor master record is maintained for each Vendor. Each Vendor master record is recognized by number. Vendor Masters: Vendor Master record consists of three segments, general data, company code data and purchasing data. Transaction Code: FK01, XK01 Invoicing Invoicing is done through the following steps: Purchase order T.Code: ME21N Goods receipt - T.Code: MIGO Invoice verification T.Code: MIRO Invoice clearing
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Invoices are cleared through cheques, Bills Payable and Cash. Payment method C (Cheque payment) Document type KZ Transaction Code: F-53 Special GL Transactions Advances made to vendors are treated as Special GL transactions Special GL indicators A Down payments F Down payment request G Bank guarantees Automatic Payment Program Steps involved in APP: 1. All Company Codes for payment transactions 2. Paying Company Codes 3. Payment methods in Country 4. Payment methods in Company Code 5. Bank Determination 6. House Banks Transaction Code: FBZP 19.ASSET ACCOUNTING Asset Accounting is utilized for managing companies fixed assets, we can categorize assets and to the said values for depreciation for each fixed asset. Fixed Asset having a useful life and are utilized for business process. In the course of process some wear & tear will occur, for that reason we calculate depreciation. An Asset Management Team is sitting in every Manufacturing Unit and at the Corporate Office, which is responsible for Asset Account Maintenance and Disclosure in the Financial Statements as per Accounting Standard 10 of ICAI Acquisition of assets Retirement of assets Calculation of Depreciation on assets
Transaction Code: OBYR
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Charts of depreciation A chart of depreciation is used in order to manage various legal requirements for the depreciation and valuation of assets. Chart of Depreciation code:ATIL Transaction Code: EC08 Depreciation areas: Book depreciation
CHART OF DEPRECIATION
COMPANY CODE APCL
COMPANY CODE APML
Chart of depreciationATIL is used for two company codes APCL and APML to country India Transaction Code: OAOB Tax codes to assigned to non-taxable transactions Input Tax: I0 - exempted Output Tax: O0 exempted Assets are grouped under the following heads Plant & Machinery, Buildings, Asset under construction Furniture and fixtures and Vehicles.
Asset Class
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Asset classes are used to structure fixed assets. Asset classes are applied to all Company Codes. Asset classes provide default values for all asset master records. Asset classes consists of account determination, screen layouts and number ranges. Account Determination GL accounts for acquisition, retirement, profit or loss on sale of assets, accumulated depreciation, depreciation and special reserve are specified in account determination. Account Determination number 200000 201000 202000 203000 204000 Description Plant & Machinery Buildngs Asset Under Construction (P & M) Furniture & Fixtures Vehicles
Number interval for asset numbers in asset class. Number range 01 02 03 04 05 Asset class Asset Class 20000 0 20100 0 20200 0 20300 0 20400 0 Description Plant & Machinery Buildings Account Determination 200000 201000 Screen layout 1000 2000 2000 3100 3000 Number range 01 02 03 04 05 From 10000 20000 30000 40000 50000 To 19999 29999 39999 49999 59999 Transaction Code: AS08
Asset Under Construction 202000 (P & M) Furniture & Fixtures 203000 Vehicles 204000
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Depreciation Keys Depreciation method The Company follows Written down value method for depreciation Rates of depreciation Company is following the Depreciation rates prescribed by Schedule 14 of the Companies Act 1956. For each rate of depreciation, a Depreciation Key is maintained. Transaction Code: AFAMA 20. Standard Reports External Reports
Report Profit and loss account for year Profit and loss account half yearly or quarterly Balance sheet actual / actual year Cash flow statement
Standard Report S_ALR_87012284 S_ALR_87012271
Internal Reports Report Standard Report
Weekly, fortnight, monthly, quarter- year, half- S_ALR_87012186 yearly, yearly Sales reports Over due items from customers statement S_ALR_87012168 Outstanding payments to accounts payable S_ALR_87012084 statements Ageing analysis report S_ALR_87012078
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Gaps to be addressed 1. 2. 3. 4. In Asset Accounting Reporting for Month wise Depreciation. Smart Form of Debit Note and Credit Note Statement of Account for Customers / Vendors with opening balance. In Vendor Master Transaction Code XK01, a user exit is required for the field SCAC 5. Trial Balance 6. In F110 Cheque Printing
21. CONTROLLING
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Controlling (CO) module is one of the integral components of standard SAP R/3 system. Controlling module provides information to the organization in decision-making. It facilitates coordination, monitoring and optimization of all processes in an organization ATIL is maintaining cost accounts for the purpose of controlling costs in manufacturing units Controlling Area represents a closed system used for cost accounting purposes. Transaction Code: OKKP
Controlling Area
Controlling Area APCL

APCL is assigned to Controlling Area APCL APML is assigned to Controlling Area APML Components are activated in the Controlling Areas
Controlling Area APML
Number intervals for controlling areas are maintained at transaction code KANK. Versions Version 0 (Plan / Actual Version) is maintained for controlling areas.
21.1 Cost Element Accounting This process takes care of integrating FI GL accounts with CO. Through cost element accounting, an enterprise can get complete information on what costs are incurred within
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the enterprise. Maintenance of Cost Element accounting of the enterprise for preparation of information relevant to internal reporting. As a manufacturing organization ATIL is concerned with the conversion of raw materials into finished products with the help of labour and other services. In order to compute cost of manufacturing a product is sub divided into cost elements They are maintaining costs records in the form cost elements Cost elements are classified into: direct material, direct labour, direct expenses and overheads. Cost Element Accounting is the part of accounting where you enter and organize costs incurred during a settlement period. It is not an accounting system. It is a detailed recording of data that forms the basis for cost accounting. Cost elements Cost elements are created in two ways Manual -T.CODE: KA01 Automatic T.CODE:OKB2 Primary Cost Elements A cost element is created for each GL account under the revenue account group (IC30) ranging from 300000 to 399999 A cost element is created for each GL account under the expenses account group (EX40) ranging from 400000 to 499999 Secondary Cost elements are created at T.CODE: KA06 Cost Element Group A Cost Element Group is created to classify the Cost Elements. Cost Element Group SLCEGROUP
Under this group cost elements are broadly classified into two heads Primary cost elements Secondary cost elements
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500000 501000 502000 503000 504000 505000 Machine Overheads Labour Overheads Set Up Costs Repairing Costs Testing Costs Tear Down Costs
21.2 Cost Center Accounting This functionality enables an enterprise to get information on where costs are incurred. It provides supporting data for management decision making to check/control the costs of individual functional areas (cost centers). This requires that all costs be assigned according to their source. However, source-related assignment is especially difficult for overhead costs. Cost Center Accounting lets you analyze the overhead costs according to where they were incurred within the organization. Cost accounting department of the ATIL is Maintaining Cost centers for collection and distribution of costs. Cost centers are classified into Production Cost Centers & Services Cost Centers. Cost Center Accounting enables an enterprise to get information on where costs are incurred. It provides supporting data for management decision making to check/control the costs of individual functional areas (cost centers). This requires that all costs be assigned according to their source. However, source-related assignment is especially difficult for overhead costs. Cost Center Accounting lets you analyze the overhead costs according to where they were incurred within the organization.
Cost center categories Standard Cost Center Categories are used E: Development F: Production
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G: Logistics H: Service Cost Center L: Management M: Material S: Human resource V: Sales W: Administration Cost Center Groups Cost Center Groups are created to classify the Cost Centers Cost Center Structure SLCC Groups Under this group, Cost Centers are grouped into the following heads 0000 1000 2000 3000 4000 5000 Management Production Administration Materials Management Sales & Distribution Service & Utility Transaction Code:KSH1
Cost Centers : APCL Cost Center COTTONMNGT COTTONPROD COTTONPMXG COTTONPBRM Description Management Production Mixing Blow Room CC Category L F F F Hierarchy 0000 1000 1000 1000
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COTTONPCDG COTTONPDWG COTTONPHLP COTTONPCBR COTTONPRFM COTTONPACR COTTONPTFO COTTONPCDG COTTONPPKG COTTONPCCR COTTONDADM COTTONDPUR COTTONDMSC COTTONDS&D COTTONDPER COTTONDPWR COTTONDRNT COTTONDR&M Carding Drawing Hi-Lap Combers Ring frame Autoconer TFO Conditioning Packing Product C.C. Administration Purchasing Material Scrapping Sales & Distribution Personnel Power Rent Repairs & Maintenance F F F F F F F F F F W M M V H H H H 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 2000 3000 3000 4000 5000 5000 5000 5000
Transaction Code : KS01
Cost Centers : APML Cost Center MELANGMNGT MELANGPROD MELANGPMXG MELANGPBRM MELANGPCDG Description Management Production Mixing Blow Room Carding CC Category L F F F F Hierarchy 0000 1000 1000 1000 1000
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MELANGPDWG MELANGPHLP MELANGPCBR MELANGPRFM MELANGPACR MELANGPTFO MELANGPCDG MELANGPPKG MELANGPCCR MELANGDADM MELANGDPUR MELANGDMSC MELANGDS&D MELANGDPER MELANGDPWR MELANGDRNT MELANGDR&M Drawing Hi-Lap Combers Ring frame Autoconer TFO Conditioning Packing Product C.C. Administration Purchasing Material Scrapping Sales & Distribution Personnel Power Rent Repairs & Maintenance F F F F F F F F F W M M V H H H H 1000 1000 1000 1000 1000 1000 1000 1000 1000 2000 3000 3000 4000 5000 5000 5000 5000
Statistical Key Figures Statistical Key Figures used as tracing factors for distribution or assessment can be collected in groups. Statistical Key Figures Statistical Key Figure 1000 2000 3000 4000 5000 Description No. Of Employees Power Area occupied Repairing hours Testing items Unit of Measurement EA (Each) KWH (Kilowatt hours) FT2 (square foot) HR EA Category Fixed Total Fixed Total Total
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Transaction Code: KK01 Activity Types A unit in a controlling area that classifies the activities performed in a cost center Activity Type Id SLMHHR SLLBHR SLSPHR SLRPHR SLTSHR SLTDHR Description Machine Hours Labour Hours Set Up Hours Repairing Hours Testing Hours Tear Down Hours Activity Unit H H H H H H Cost Center Category * * * * * * Activity Category 1 1 1 3 3 3 Allocation Cost Element 500000 501000 502000 503000 504000 505000
*All cost center categories Activity Category 1 Manual Entry, Manual allocation Activity Category 3 Manual Entry, Indirect allocation Transaction Code : KL01
Planning The following steps do Cost Center Planning Version 0 Plan / Actual Planning Profile Set Planning Profile in T.Code: KP04 Planning Layout Layout is designed in T.Code: KP26
Revaluation of Planning
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Overhead Structure Overhead Structure defines the rules for the calculation of the values to be posted. An overhead structure consists of the following rows:

Base row - Contains the amount used as a basis for the overhead application Calculation row - Contains the overhead percentage rate to be applied to the base row Totals row - Contains the sum of the base and overhead amounts
Overhead structures are used to calculate accrual costs.
Distribution of overheads It involves three stages Collection and classification of overheads Departmentalization of overheads: allocation / apportionment of overheads Absorption of overheads Overheads can be distributed/apportioned or absorbed by using assessment cycles Transaction Code: KSU1 21.3 Product Cost Controlling Product Cost Controlling is used to estimate the Standard Cost per Unit of a product and also determine the cost of goods manufactured or cost of goods sold. This will help To fix the pricing floors To optimize the cost of goods manufactured and cost of goods sold
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To valuate inventories and work in process & production variances and scrapping costs
Cost of a Product constitutes Raw Material Cost Process/Conversion costs Overheads This tool contains the following application components 1.Product Cost Planning 2.Cost Object controlling
Product Cost Planning The following settings are made for the Product Cost Planning. 1. Calculation bases are defined 2. Overhead rates are defined 3. Overhead Cost Elements are maintained for Material overheads, Personnel overheads and Manufacturing overheads 4. Credits are defined 5. Costing sheets Costing Sheet defines how values are posted in the SAP system A costing sheet consists of the following lines: Base lines These contain the amount or quantity on which the overhead is calculated. Calculation lines These contain the percentage rate to be applied to one or more base lines. Totals lines These contain the sum of the base amount and calculated amounts. 6. Cost Component Structure 7. Cost Estimation with Quantity Structure
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Cost Object Controlling The following steps are involved in Cost Object Controlling 1. Order Type Standard Order Type PP01 is used. T.Code: OPJH 2. Order Type dependent parameters are defined. Plant is specified in this step. T.Code: OPL8 3. Scheduling parameters for Production orders are defined. T.code: OPU3 4. Confirmation of parameters. T.code: OPK4 5. Costing Variants PPP1 - Production Order: Planned PPP2 - Production Order: Actual are used T.code: OPL1
Work in Process (WIP) The following steps are involved for calculating Work in Process 1. 2. 3. 4. 5. 6. 7. 8. Result Analysis Keys. Define Cost Element for WIP Calculation. Define Result Analysis Versions Define Valuation Methods. Define Line Ids Define Assignments Define Posting Rules for settling WIP Calculation of WIP T.Code: OKG1 T.Code: KA02 T.Code: OKG9 T.Code: OKGC T.Code: OKGB T.Code: OKG8 T.Code: KKAX
Information System Costing Reports Reconciliation statement of financial accounting with cost accounting Production statement (periodic) Cost element allocation to cost centers report Cost center plan/ actual comparison, Cost center actual/actual Production Variance Analysis Report Standard SAP Reports available S_ALR_87013603 S_ALR_87013158 S_ALR_87013601 S_ALR_87013611 S_ALR_87013623, S_ALR_87013624 S_ALR_87013143
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Business Blueprint
Index Page 1. Organization Structure
i) ii) iii) iv) v) i) ii) iii) iv) v) vi) vii) viii) ix) x) i) ii) iii) iv) v) vi) vii) viii) ix) x) xi) xii) x) Company Code Plant Storage Location Purchase Organization Purchasing Group Material Master Material type Material group Valuation class Batch determination Vendor Master Info Record Master Source List Master Quota arrangement Service Master Purchase Requisition Release procedure RFQ & Quotation Purchase Order Outline Agreement Contract Scheduling Agreement Pricing Procedure Special Procurement Process Subcontracting Consignment Stock Transfer Account Determination 03 03 03 04 05 05 06 06 07 08 09 10 11 13 14 14 15 16 17 18 21 22 23 23 24 24 27 27 27 27 31
2. Master Data
3. Procurement Process
4. Inventory Management
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ABC Textiles India Ltd. i) ii) iii) iv) Goods Receipt Goods Issue Stock transfer Transfer Posting 31 31 31 31 35 35 35 37 37
5. Physical Inventory 6. Invoice Verification

i) Logistics Invoice Verification
7. Report 8. Gap Analysis
Organization structure:
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AP SPINNERS INDIA LIMITED
AP COTTON LIMITED
CENTRAL PURCHASE DEPARTMENT
AP MELANGE LIMITED
PLANT-I (COTTON) STORES DEPTT.

RAW MATERIALS SPARES BY PRODUCTS FINISHED PRODUCTS PACKING MATERIALS SCRAP
PLANT-II (POLYESTER)
STORES DEPTT PURCHASE DEPTT
PLANT-III (MELANGE)
PURCHASE DEPTT STORES DEPTT
PURCHASE DEPTT
.
RAW MATERIAL SPARES BY PRODUCTS FINISHED PRODUCTS PACKING MATERIALS SCRAP RAW MATERIAL SPARES BY PRODUCTS FINISHED PRODUCTS PACKING MATERIALS SCRAP
1 ORGANISATIONAL STRUCTURE
Company Code AS IS
TO BE
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Company Code AP Cotton AP Cotton Ltd Ltd AP AP Mlange Ltd Mlange Ltd Plant A plant is a place where either material is produced or goods Plant Deshmukh Deshmukh Bhongir AS IS Cotton Mill Polyester Mill Mlange Mill TO BE Code APCM APPM APMM Description Cotton Plant Polyester Plant Mlange Plant Code APCL APML Description AP Cotton Limited AP Mlange Limited
Storage Location Storage Location is an organizational unit, which differentiates between the various stocks of material within a plant and can have physical / logical existence. The storage location has the following attributes: 1. There can be one or more storage locations within a plant 2. A storage location will have an address. 3. Stocks are managed only on a quantity basis and not on a value basis at storage location level. 4. Physical inventories are carried out at storage location level.
Storage Location
Cotton Plant RMCO
Polyester Plant RMPO
Mlange Plant RMME
Raw Materials
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Packing Materials By Products Finished goods Spares Scrap PMCO BPCO FGCO SPCO SCCO PMPO BPPO FGPO SPPO SCPO PMME BPME FGME SPME SCME
Purchase Organization In SAP solution, there will be a purchase organization having four digit alphanumeric code and will be responsible for all purchasing activities of the company codes APCL & APML..
Purchase Organizatio n Cotton Plant Polyester Plant Mlange plant Central Purchase Organizatio n
TO BE AS IS Cotton Purchase Polyester Purchase Code CPPO PPPO Description Cotton purchase organization Polyester purchase organization Mlange purchase organization ATIL Central purchase organization.
Mlange Purchase MPPO Corporate Purchase Organization
REPO
Purchasing Groups The purchasing group is a key for a buyer or a group of buyers, who is / are responsible for certain purchasing activities. Internally, the purchasing group is responsible for the procurement of material or class of materials. Externally, it is the principle channel for an
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enterprises dealings with its vendor. Purchasing group defined APCL & APML are as follows: Purchase Group Raw Material Others Cotton Plant CPR CPO Polyester Plant PPR PPO Mlange Plant MPR MPO for Company codes
Central Purchase Organization RPR RPO
2 MASTER DATA
Material master
Material master contains information of all the materials that a company produces and procures, stores and sells. It is the companys central source for retrieving material specific data Benefit Analysis: The integration of all material in a single database object eliminates the problem of data redundancy. All areas, such as purchasing, inventory management, material planning, and invoice verification for posting invoice, in Sales and Distribution for sales order processing, in Production Planning and Control for material requirement planning, scheduling and work scheduling in Quality Management and Warehouse Management can jointly use the data stored. Material number is a number uniquely identifying a material master record, and thus a material. User can have Internally (system) generated material number or can have his own externally entered number. User will be identifying material with maximum 18 digit alphanumeric code having description of 40 characteristics. User can have Inventory material for Value and Quantity, OR Quantity only.
Material master will have the following important fields, Material number Material description Material type Material Group Stock-keeping unit Purchasing group & ordering unit of measure
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Batch management Plant / storage data MRP parameters Price indicator& price Valuation class for G/L account determination Sales organization, distribution channels and other sales parameter Industry sector (T-Textiles)
VIEWS AND SCREEN SEQUENCE: Material Type RAWM PACK SPAR PNTS FINS CONS PIPE Basic Data
Purchasing Data
Plant Storage Data
Accounting Data
MRP Data
Sales Data X
X X X X
MATERIAL TYPE Grouping of materials with the same attributes of characteristics. AS IS MATERIAL TYPE MATERIAL DESCRITION TYPE RAW MATERIALS RAWM TO BE NUMBER RANGE RM0001 RM9999 DESCRIPTION
TO RAW MATERIALS
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PACKING MATERIALS SPARES PAINTS FINISHED GOODS CONSUMABLES PACK SPAR PNTS FINS CONS PM0001 PM9999 SP0001 SP9999 PA0001 PA9999 FG0001 FG9999 CO0001 CO9999 PI0001 PI9999 SF0001 SF9999 TO PACKING MATERIALS TO SPARES TO PAINTS
TO FINISHED GOODS TO CONSUMABLES TO PIPE LINE MATERIALS TO SEMI FINISHED GOODS
PIPE LINE PIPE MATERIALS SEMI FINISHED SEMI GOODS Material Group
Grouping of material with same attributes, which can be used to restrict the scope of analysis. The following material groups are identified: Material type Raw material Raw material Raw material Raw material Packing material Packing material Packing material Paints Equipments Equipments Consumables Finished Finished Finished Finished Finished VALUATION CLASS: Valuation Class is used to determine which stock account is to be updated during the goods movement of the material. Valuation class is used to combine materials for Code RAWM RAWM RAWM RAWM PACK PACK PACK PNTS EQUP EQUP CONS FINS FINS FINS FINS FINS Material group COTTON POLYESTER VISCOSE DYCOTTON CONES CARTONS PALLETS PAINTS EQUIPMENTS PRTs CONSUMABLES COTTON Description Cotton Group Polyester Group Viscose Group Dye cotton Group Cones Group Cartons Group Pallets Group Paints Group Equipments Group PRTs Group Consumables Group Cotton Group Polyester Group Mlange Group Byproducts Group Scrap Group
POLYESTER
MELANGE BY PRODUCTS SCRAP
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assigning G/L accounts so that you do not have to manage a separate stock account for each material. A set of Valuation class will be attached to each material type, which will determine the stock account where the accounting entry will happen. The list is as given below: Material Type RAWM RAWM RAWM PACK PACK PACK EQUP EQUP PNTS CONS FINS FINS FINS FINS FINS Material Valuation Material Valuation is determination of value of a stock of material. It includes: Valuation price Assignment to a valuation class Selection of valuation method using the price control indicators S-standard V-Moving average price All the material will be valuated as per the valuation price control. Period end has to be carried out in materials management at the end of each period to allow goods movement in the next period. This is required since the price, stock value and quantity are managed period wise in the system. Before creating any material, user needs to verify if it has already been created with another number or not. The system does no allow the creation of a material with same number twice, but cannot control creation under different number. Valuation Class 3000 3001 3002 3050 3051 3051 3040 3041 3060 3061 7920 7921 7922 7923 7924 Valuation class description Raw Materials Cotton Raw Materials Polyester Raw Materials Viscose Packing Materials Cones Packing Materials Cartons Packing Materials Pallets Equipments PRTs Paints Consumables Cotton Polyester Mlange Byproducts Scrap
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User needs to enter the description of the material logically. It is important since the system does not have functionally on duplicate check. The user also needs to clearly identify Material Types, Unit of Measurement, as these are important parameters of any material. Changes in these are very difficult. It is advisable to record all the inputs first and then create the same in the system. Benefits: Correctness in maintaining Material code, Description, Material Type, Valuation class and units of Measurement Completeness as well as correctness of the data from various especially MRP, Sales and Accounting/Cost Views Maintenance of Correct Excise data to take care of all Legal requirements.
BATCH DETERMINATION
A batch is a quantity of a material produced during a given production run. A Batch represents a homogeneous unit with unique specifications. A batch is a subset of total quantity of material held in stock. This subset is managed separately from other subsets of the same materials BENEFITS: Batch master record can be created manually or posting a goods movement automatically. The cotton/polyester/viscous are procured and batch number is assigned to it externally. For the yarn produced the batch number is to be generated internally, which should contain the batch number of cotton/polyester/viscous used to produce it. For e.g. If the batch number of cotton is COVNDATE, the yarn must contain the batch number COVNDATE LOTDATE Batch can have any alphanumeric number. This number can be assigned either externally or internally. The quality checks become easier with the batch management process. COMPANYS REQUIREMENTS ARE TO Select the most appropriate batch to meet customer needs. Select the most appropriate component batch to make a quality product. Issue stock based on (FIFO).
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INCOTERMS Sl. No. 1 2 3 4 5 6 INCO TERMS FOB C&F FOR ONS CIF EDS DESCRIPTION Free on board-Export Cost and freight-Import Freight on road-Domestic On site Cost insurance freight Ex-destination station
VENDOR MASTER The Vendor master record contains information on enterprise vendors. This information is stored in individual vendor master records. In addition to the vendors name and address, a vendor master record contains data such as the following: The currency used for transactions with the vendor Terms of payment Names of important contacts (e.g. sales persons) Pricing schema for vendor Reconciliation account Vendor account group Customer code for vendor if vendor is also a customer
Since, for accounting purposes, the vendor is also a creditor of the enterprise, the vendor master record also contains accounting data such as the reconciliation account from the general ledger. Both purchasing and accounting therefore maintain the vendor master record. This is also the reason for the subdivision of the data in the vendor master record into different categories. The data in the vendor master record is subdivided into the following categories: General data : This data is valid for the whole client. It includes the vendors address and bank details, for example. Accounting data: This is maintained at Company code level comprises data such as the reconciliation account and the payment methods for automatic payment transactions. Purchasing data:
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This data is maintained for each purchase organization comprises the purchase order currency, Inco terms, and various control data pertaining to the vendor. VENDOR ACCOUNT GROUPS The Account Group has control function, when we maintain the vendor master record only the screens and fields data needed for the relevant role of our business partner appear and are ready to accept user input. This is controlled by account group. The account group determines: The type of number assignments (internal or external) The field selection which fields are ready for user input and which fields must be maintained and which are hidden. Which partner schema are valid The status whether the vendor is one time vendor Vendor sub range and plant specific data
Vendor Vendor Type Description Account Group Codes VIND VENDOR INDEGENOUS VIMP VENDOR IMPORT VEMP EMPLOYEES VOTV VENDOR-ONE-TIME VSTAT STATUTORY VENDOR
Number Range V1 (50000 - 59999) V2 (60000 - 69999) V3 (70000 - 79999) V4 (80000 - 89999) V5 (90000 - 99999)
Benefits: Correctness in maintaining Vendor Code, Name and Address, Vendor Account Group, Reconciliation Account Completeness as well as correctness of the data from various views especially Logistics (purchase Org data) and company code data Maintenance of correct Excise data to take care of all Legal requirements. Effective grouping of vendors Effective monitoring and MIS
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Effective control on vendor creation. Instead of separate master for each agency (like purchasing, sales and accounts), system will provide centralized data for master data. It is required to identify person who will trigger creation of vendor master and follow-up action by different agencies in logistic system.
INFO RECORD MASTER

The Purchasing Info record master helps to define vendor specific information for a material. The purchasing Info record provides the option of storing information about a vendor and a material as master data at purchase organization and plant level. You can define the following information in info records: Current and future prices and conditions (for example, freights and discounts) Delivery data (for example, planned delivery time and over delivery and under delivery tolerance) Vendor data (for example, contact person) and vendor specific data about the material (such as the vendor sub range to which the material belongs, description of material at vendor) Number of last purchase order Text Internal info memo record: This is an internal comment that is copied to the purchase order item. This text is not printed. PO text in the purchasing info record: This is used to describe the PO item. It is copied to the purchase order item and printed.
Benefits: When creating the purchasing documents, the data from the info record is copied into the documents as a default value. You can also use the list displays for the info records to determine which vendors offer a particular material or which materials can be procured from a particular vendor
SOURCE LIST
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The source list contains the allowed, preferred and / or blocked sources of supply for a material in a Plant that are valid within a certain period. Each source is defined in the source list by a source list Record. Source list contains information: Source list records enable you to determine and check sources. Fixed sources are always preferred over other sources in the relevant validity period. Only one fixed Source may exist for a material within a certain validity period. Buyers are not allowed to procure from blocked sources. Blocked sources are not taken into account in source determination. The MRP indicator in the source list stipulates how the source defined in a source list record is taken into account in materials planning. If a source list requirement exists, a material may not be procured from sources other than those Included in the source list. A source list requirement can be specified either for an individual material (in the material master), or for all the materials of a plant (using a Customizing parameter). Source list analysis enables you to list the materials of a plant for which no source list records exist during a certain period. This function is useful in the case of a source list requirement (use of source List mandatory). Process decided:
IN ABC TEXTILES India Limited, we must maintain the source list for each material for a particular plant
QUOTA ARRANGEMENT The quotas indicate the percentages of a total requirement that are to be procured from each of the various sources over a period. A quota arrangement is set up for a specific timeframe. A quota arrangement item is created for each source of supply within the period. Only consecutive validity periods can be specified for a material. A quota arrangement can provide for external procurement or internal (in-house) production, as well as various special procurement types. For a quota arrangement to be applied to a material, the quota arrangement usage indicator must be set in the material master record. By setting the quota arrangement usage indicator in the material master record, you specify that: A quota arrangement can be applied to a material. The business application areas in which the quota arrangement is used, and the quota-allocated quantity, is updated progressively. Quota arrangement usage indicators are defined in Customizing.
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SERVICE MASTER RECORD The Service Master Record belongs to master data services as a source of data that can be used when you create service specifications. A service master record contains the following principal information for the unique description of an external service Service number Service category Description texts (short and long text) Base unit of measure Material Group Valuation class
Benefits: Service master records can be used by different applications. Like MM-Purchasing, Plant maintenance (PM) By using service master record we can reduce the amount of time needed for this activity, as well as the occurrence of error. This is because we need to enter the services specifications completely once only in the service master records. The service master record transaction is single-screen transaction that you can use to create, change and display services. Price for external services that are valid over a longer period can be recorded in the system in the form of service conditions.
3 PROCUREMENT PROCESS
Procurement Cycle
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Determination of requirements Source Determination Vendor Selection P O Processing P O Monitoring Goods Receipts Invoice Verification Payment Processing
PURCHASE REQUISITION Purchase Requisition represents the requirement of non-production material or services, which can be procured so that these are available at the particular point of time for usage. In ABC TEXTILESIndia Limited, PR will be generated by any of the users (depts.)
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In, ABC TEXTILESIndia Limited a material master for the stock material should exist in the system, as no stock can be maintained without a material master. In the material master minimum stock levels can be maintained. To comply with the business requirement, MRP profiles will be created using Auto Reorder point planning with or without regular interval planning. If there is preferred vendor for the requirement created, MRP will create a PR (approved requisition) with vendor assigned for indirect non-ROL items. A Purchasing Requisition can create requirements for the stock materials online. PR will have following key data: PR number Material code Material description-which will be either copied from material master in case of material master available or this will be entered by users in case of master is not available Quantity required Delivery date Storage location and plant where the material is required Requisitioner Account assignment (e.g. cost center) Item category (i.e. standard service, subcontracting, stock transfer) Rate per unit if material master with accounting view is available, else user need to enter the Rate per unit. This is very important field as value based release strategy depends on this field. Services and service specification of service requisition. A PR can be created directly or indirectly in the SAP R/3 system: Direct means that the purchase requisition is created manually in the Department that made the request. Indirect means that the purchase requisition is created automatically, like MRP.
Number Range: In ABC TEXTILESIndia Limited internal number range will be used for PR. This will be identified based on document type of PR. These are as follows: Document type NB Description Standard Number range Internal range
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FO Frame-work Internal range
Tracking is also possible based on material group, requisitioner, account assignment, item category, material and buyer. For MRP run requisition generation user has to maintain MRP type and other planning requirements like Reorder level, safety stock, lot size etc. Precautions: Correctness is to be maintained for MRP parameters like reorder level, safety stock etc. Correctness in choosing document types Correctness in account assignment and item category Correctness in choosing material code, delivery date and quantity Benefits: Reduction in manual efforts required to monitor the stock for requirement planning Effective monitoring of PR, this will enable the requisitioner to do the follow-up
RELEASE PROCEDURE
It refers to the approval of purchasing documents. Two different procedures are available for requisitions: With classification With this procedure, requisitions can be released both at item level (i.e. item-byitem) and in total. The latter approach is also termed "overall release". Without classification With this procedure, requisitions can only be released at item level.
CHARACTERISTIC
The communication structure CEBAN (for requisition) and CEKKO (ext purchase doc) contain all fields that can be defined as release characteristic.
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Characteristic to be taken: I) Value II) Plant CLASS: - All characteristics that are to be used in release strategies for requisition or external purchase document must be collected together in classes. The classes must be assigned to class type 032 RELEASE CONDITION: - Release condition determines the release strategy. RELEASE GROUPS: -Grouping of different users or authorities for the purpose of approving documents. In a release group there can be any number of release codes. Release Group: 2 groups [c1 & c2] RELEASE CODE:-It is a 2 char ID defined for each individual user or authority for approving the documents.
P1 P2 P3 P4 P5 P6 P7 P8 P9 P10 P11 P12
Requisitioner (production) Requisitioner (Maintenance) Requisitioner (Miscellaneous) Purchase Officer Purchase officer-central Assistant manager-purchase Purchase manager Production manager Plant manager Assistant general manager General manager Vice-president
RELEASE STRATEGY The release strategy defines the approval process for purchase requisitions or external purchasing documents. Strategy 1 -S1 up to 1, 00,000 INR
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Release code: P1-Requisitoner (production) P4-Purchase officer P7-Purchase manager P8-Production manager Strategy2S2 1, 00,001 to 5, 00,000 INR
Release code:
P4-Purchase officer P7-Purchase manager P8-Production manager P9-Plant manager P11-General manager P12-Vice president Strategy 3- S3 for central purchase organization P5-Purchase officer P6-Assistant purchase manager P10-Deputy general manager P12-Vice president RELEASE INDICATOR It is a single char ID to represent a status of document when release authority releases the document with release code. either of the two can release
Release Indicator: U-Under process

A- Approved.
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RELEASE PRE-REQUISITE:-It defines the sequence of approval.
REQUEST FOR QUOTATION

A Request for Quotation (RFQ) is an invitation extended to vendor by a purchasing organization to submit a quotation (bid) for supply of material or performance of services. This process will be used to raise the requirement of estimation to vendor for supply of particular material or service. Prices and conditions quoted by vendors are entered in original RFQ. A user can have the system to determine the most favorable quotations submitted. User can also store the price and terms of delivery from certain quotations in an info record for future accessing. Number Range A number will identify each RFQ. In case RFQs are to be posted to multiple vendors, user can track the quotation via Collective RFQ No, which is a tracking number manually entered in the system. There will not be any release strategy applicable for RFQ. In SAP the quotation no. is generated internally for each vendor. All these quotations can be linked through collective number. In SAP both the RFQ and vendors response to the quotation document will be handled through the RFQ function. Price Comparison The decision to select or reject a vendor can be based on the price comparison list generated by the system and by checking the vendors technical competency (specifications, delivery items), which will be done outside the system. Once the vendor is selected the price can be updated in the info record from the price comparison list by selecting the info record indicator. RFQ will have following data RFQ Number Vendor Code Material code Description either copied from material master if it is available or this will be entered by user in case when master data is not available Services and service specification of service requisition Quantity required Delivery date Storage location and plant where the material is required Quotation deadline date User can not enter account assignment in RFQ
Process decided
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In ABC TEXTILESIndia Limited there will be one type of RFQ, which will be used for all type of materials and services Document type AN Description Request for Quotation Number range Internal number range
PURCHASE ORDER
The selected vendor is offered with the purchase order quoting the prices and terms and conditions with delivery time and required quantity. Authorization in terms of total value of goods in purchase order is Up to 50000 INR Purchase Officer is authorized to release. 50000 - 100000 INR, authorized officials are Purchase officer followed by Purchase Manager.
If reference is made to a purchase requisition, an RFQ or a contract, item data and any existing header data is copied from the proceeding document to the purchase order. This reduces the entry effort required and therefore reduces possible entry errors. You can change most of the copied data in the purchase order. To create a purchase order with reference to another document, you can also enter the number of the document and the number of the item directly in the item overview in the corresponding field of the purchase order. The purchase order can be generated manually without reference to PR or with reference to PR, contract, Info record, Quotation, last Purchase order number etc. Purchase can be generated with or without reference to material master. Release procedure will be defined based on As-Is conditions. The purchase document can be printed in standard SAP form or purchase order samples given by the client after necessary enhancement.
DOCUMENT TYPES AND NUMBER RANGE

Document type NB FO UB Description Standard Purchase Order Frame-work Order Stock-Transport Order Number range Internal Range(45 series) Internal Range(46 series) Internal Range(47 series)
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OUTLINE AGREEMENTS
An outline agreement is a longer-term arrangement with a vendor for the supply of material or provision of services based on predefined terms and conditions. This arrangement is valid for certain period and for a predetermined total purchase quantity or value. There are two types of outline agreements. CONTRACT SCHEDULING AGREEMENT CONTRACTS Contract is an external purchasing document created by purchase dept. with or without reference to other document for long term supply of material or service with respect to quantity or value. Contract is not a final document for supply of material.
There are two types of contract used by ABC TEXTILESIndia Limited.

Quantity contract The total quantity to be ordered over the duration of the agreement has already been agreed. The Contract counts as fulfilled once an agreed quantity has been reached through the issue of contract release orders. In quantity contract, you define, among other things, the target quantity and conditions of ordering for each item. Value contract The total value of all contract release orders is not to exceed a certain amount. The contract counts as fulfilled once an agreed value has been reached through the issue of contract release orders.
Document type MK
Description Quantity Contract
Number Range Internal Range
WK
Internal Range Value Contract
SCHEDULING AGREEMENTS It is an external purchasing document created while purchasing with or without referring to other documents for long-term supply of materials.
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Scheduling Agreements have the legal validity, unlike contract there is no separate release order required, but a delivery schedule will be issued for supply of material. Document type for Scheduling Agreement: Document type LP LU PRICING PROCEEDURE Pricing procedure deals with access sequence and condition types in purchasing conditions and assigns these condition types in the pricing procedure. Following pricing Procedure is suggested for ABC TEXTILESIndia Limited as per application. Define Price Determination Process: The following steps describe how the price determination process is controlled. Before you set up the price determination facility in the SAP system. Check the dependencies under which prices, discounts, and surcharges are arrived at. For example, determine whether conditions apply to individual material groups and the basis on which surcharges and discounts are calculated. Then bring your pricing dependencies into line with the criteria for price determination in the sap system. Define Calculation Schema: In the Calculation Schema (pricing procedure), you specify which condition types are to be taken into account in which sequence. In the price (or cost) determination process, the sap system automatically determines which calculation schema is valid for a business transaction and takes into account, one after another, the condition types it contains. Schema Group These allow you to group together certain purchasing organizations that use the same calculation schema. NOTE: (calculation schemas may also be referred to as pricing procedures and schema groups therefore as procedure groups.) Schema Determination Assigning purchasing transactions and processes to a calculation schema Description Number Range Scheduling Agreement Internal Range without releasing document Stock transport Internal Range scheduling agreement
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Sch. Gp. P.Org APS1 APS2
Sch.Gp.Vend APV1 APV2
Procedure AP0000 AP0002
Description Pricing Procedure for ABC TEXTILESDomestic Pricing Procedure for ABC TEXTILESImport
Pricing conditions used in imports pricing procedure Gross price (Automatic) Gross price (Manual) Discount % on Gross Freight % Freight (Value) Freight (Quantity) Insurance (Value) Customs % Customs (Value) Customs (Quantity) Edu. CESS % Customs Edu. CESS % Additional Excise Duty % Pricing condition used in Indigenous pricing procedure Gross price (Automatic) Gross price (Manual) Discount on Gross % Discount /Quantity Discount lump sum Basic Excise Duty % Basic Excise Duty value Educational CESS % Service Tax Surcharge Insurance% Insurance value Freight% Freight Quantity Freight Value Discount on Final price % Cash discount
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BENEFITS: The system generates the price automatically with the implementation of pricing procedure. Correctness in maintenance of condition types and access sequence Correctness in entering pricing conditions, vendor assignment to pricing conditions and tax code Correctness in choosing account assignment and item category.
SPECIAL PROCUREMENT PROCESS

SUB CONTRACTING Sub contracting is an external purchasing process of finished product with a sub contract order that also contains entries about the components to be provided for the subcontractor. In inventory management the components are posted/provided in the stock of material provided to the vendor. The sub contractor supplies his services and delivers the manufactured or processed material. The goods receipt for the finished product is entered in the inventory management. The consumed components are therefore cleared from the stock of material provided to the vendor. If the subcontractor reports an excess consumption or under consumption of components after the goods receipt posting, these can be corrected with subsequent adjustment. The sub contractor shows the service actually planned in the invoice. The invoice is entered in the Logistic Invoice verification.
VENDOR CONSIGNMENT Vendor Consignment material is a stock of material owned by vendor but the stock is stored at companys premises. The liability will come to the vendor only when company takes ownership of the material or when you issue to cost center. The settlement of consignment liability with the vendor is done on periodic basis. The consignment goods are settled without invoice receipt, as the vendor cannot trace the goods withdrawal directly. The vendor can only manage the consignment stock with his deliveries and on the payment made by company.
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STOCK TRANSFER A stock transfer is the removal of material from one storage location and its transfer to another storage location. Stock transfer can occur either within the same plant or between two plants. In ABC TEXTILESIndia Limited the process of stock transfer between plants is by using two-step procedure because the plants are located in different places. If we use the twostep procedure, you can monitor stocks while they are in transit. Once you have posted the goods issue from the issuing point, the stock is located in stock transfer at the receiving point, and is managed as such in the system. Stock transfer can be carried out in two levels: Stock Transfer from one company code to another Stock Transfer from one plant to another
ACCOUNT DETERMINATION Automatic Account Determination Process Valuation Area Plant Material Business Transaction - Movement type
Valuation Area
Material
Movement Type
Movement Indicator Consumption posting Value String Counter Transaction/ Event Key
Company Code Chart of Accounts Valuation Grouping Code
Valuation Class Material Type Account Category Reference
Special Stock Ind Value Updating Quantity Updating
Account Modifier Check
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Account Category Reference Account Category Reference is grouping of valuation classes used by the system to check whether the valuation class entered is allowed when we maintain the accounting data in the material master record. This account category reference can be assigned to a material type. Account Category Reference A001 A002 A003 A004 A005 A006 Descriptions Reference for RAW MATERIALS Reference for SPARE PARTS Reference for PACKING MATERIAL Reference for SERVICES Reference for PAINTS Reference for FINISHED
Valuation Class Valuation class is grouping of material with same accounting requirement for the purpose of automatic account determination. Valuation Grouping Code The Valuation Grouping Code facilitates differentiation by valuation areas during the process of automatic account determination. It allows the grouping and consolidation of valuation areas for the determination of the GL account for each business process. Valuation Grouping Code: 0001 Transaction/Event Keys It is an internal processing key facilitating automatic account determination for the various materials and invoice posting. The system uses the Transaction/Event key to determine the account in which posting line is generated. At least two Transaction/Event keys are involved in each posting.
Transaction/Event Key
BSX
Description
Inventory Posting
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WRX GBB BSV KON PRD UPF DIF GR/IR clearing account Off-setting entry/Inventory posting Stock Change account Consignment liabilities Price Difference account Unplanned delivery cost / freight Materials management small price diff a/c
Account Modifier
Account Modifier is a key used to determine finer accounts of a transaction/event key. In finer account we further distinguish the account. For example account modifier for GBB is Account Modifier AUF BSA INV VAX VAY VBO VBR VNG ZOB ZOF Value String Value string is a group of possible transaction or event keys that can be triggered due to a movement type. For e.g. WE01 for goods receipt Description Goods Receipt for Orders with a/c assignment Initial entry of stock balances Expense/Revenue for inventory Diff. Goods Issue for sales order without a/c assignment Goods Issued for sales order with a/c assignment object Consumption from stock of material provided to vendor (subcontracting) Internal goods issues for cost center For scrapping/destruction Goods receipt without purchase order Goods receipt without production order
INVENTORY MANAGEMENT
The second step for external procurement process is the goods receipt. When goods are delivered against a purchase order, it is important for all departments concerned that you enter this goods receipt with reference to the PO. When you record the receipt of goods,
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the system suggests all open items from the purchase order. This facilitates both the entry and checking of incoming goods. The right material has been delivered The right quantity has been delivered, or whether there has been over- or under delivery
Process Decided
The following Goods Movements will be performed in ABC TEXTILESIndia LIMITED: Goods Receipt - A goods receipt (GR) is a goods movement with which the receipt of goods from a vendor or from production is posted. A goods receipt leads to an increase in storage location stock. Goods Issue A goods issue (GI) is a goods movement with which a material withdrawal or material issue, a material consumption, or a shipment of goods to a customer is posted. A goods issue leads, to a reduction in warehouse stock. Stock Transfer - A stock transfer is the removal of material from one storage location and its transfer to another storage location. Stock transfer can occur either within the same plant or between two plants. Transfer Posting A transfer posting is a general term for stock transfer and changes in stock type category of a material. It is irrelevant whether the posting occurs in conjunction with a physical movement or not. Physical Inventory posting - After user decides to carryout physical count, user will have to create Physical Inventory document, enter the count and post the difference (Excess/Shortage). At the time of posting the difference, system will generate the material document. For valuated stocks, Accounting document will also be generated. Description MATERIAL DOCUMENT CONTROLLING DOCUENT ACCOUNTING DOCUMENT Number Range Internal range Internal range Internal range
Results of Goods Movements in the System: Material document is generated, which is used as proof of the movement and as a source of information for any other applications involved. If the movement is relevant for Financial Accounting, one or more accounting documents are generated. The stock quantities of the material are updated.
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The stock values in the material master record are updated, as are the stock and consumption accounts. Movement Type: The Movement Type is a three-character key used to differentiate between goods movements. Examples of such goods movements are goods receipt, goods issues or transfer postings. Benefits: It plays a central role in automatic account determination in SAP R/3 The movement type determines which stock or consumption account are updated in financial accounting The movement also determines the layout of the screen for document entry or updating of the quantity fields Movement Types used in ABC TEXTILESIndia Limited: Movemen t Type 101 102 103 105 122 201 261 309 311 Description GR for Purchase Order into unrestricted use stock Reversal/cancellation of GR into unrestricted for purchase order Goods Receipt for purchase order into GR blocked stock Release GR blocked stock to Purchase order receipt Return delivery to the supplier or to production Remarks For this a purchase order reference is required and will be used for gate entry for self certified materials Can be used for cancellation for get entry or reverse short receipt material during GR This is first step of two step process This is step two of the above mentioned process This movement type is used to differentiate between cancellation and return
Goods Issue for Cost This movement type is used to issue the stock center material against cost center Goods issue to an order This refers to issue to all orders like, maint, and production order. Transfer posting from This movement is used to change the status of material to material the material. Transfer posting from Internal storage location transfers storage location to storage location
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453 Transfer posting to own This movement is used when the customer stock from returns from return the material due to quality reasons or customer expiry of shelf life period or damage of packaging. Transfer posting from This movement type is used for transferring of vendor consignment material from consignment stock stock to companys own stock (un-restricted use stock) Transfer posting This is used to issue material to vendor unrestricted use stock against subcontract order. to stock of material provided to vendor Reversal of Transfer This is used to get material back from vendor posting unrestricted use without processing or reversal of 541 document stock to stock of material provided to vendor Receipt of By product from Subcontractor Scrapping from This is used for posting of scrap. unrestricted stock Initial entry of stock This movement type will used to upload the balances opening stock balance into SAP; there is a provision to enter the value of the goods movement. Reversal of Initial entry This movement type will used to remove the of stock balances opening stock balance uploaded into SAP Goods issue for delivery This movement type is created automatically with the goods issue delivery function in SD Goods Issue for stock This movement type is used for intra company transport order with stock transport order shipping Goods Issue for a inter This movement type is used for inter company company stock stock transport order transport order Returns from customer Using return delivery Inventory differences in This movement will be used when the unrestricted stock difference in physical inventory is posted.
411k
541
542
545 551 561
562 601 641 643 651 701/2
BENEFITS: -
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Any material movement happens to take place in SAP system; the system automatically determines the G/L a/c without the intervention of the user. With every material movement the inventory gets updated. GR is not printed unless configured for part 1 & II entry of excise documents.
5 PHYSICAL INVENTORY
In SAP system the Physical inventory is done in three steps. Creation of physical inventory documents Counting of physical stock and entering physical stock into the system Simulating and posting the differences, recounting if necessary and re-posting where the difference goes to the Profit and Loss statement i.e. automatic changing of GL a/c and adjustment in the physical inventory. Activating the creation of change documents The system creates a change document when a user changes a physical inventory count. The system creates a new change document every time a change is made. Adjusting the book inventory balance in the physical inventory document. This function defines how the system reacts when a goods movement is posted for a material that is currently subject to an active physical inventory and for which the book inventory balance was frozen in the physical inventory document. The book inventory balance was frozen when the freeze book balance indicator is selected or when the count results in the physical inventory document are entered. If inventory differences result from a book inventory balance that is no longer up-todate when the differences are posted and initiate a recount if necessary. This means a new physical inventory for the inventory document. Physical Inventory methods to be followed will be Periodic physical inventory. BENEFITS: The Physical inventory process in the SAP system is an integration of physical stock taking register, counting process, updating of bin card stock/book stock, charging the difference to GL a/c in financial accounting in the existing system available with in the company. There is very little chance of data entry error. It reduces the stock discrepancies and obsolesces.
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6 INVOICE VERIFICATION
LOGISTIC INVOICE VERIFICATION It is in Logistics Invoice Verification that incoming invoices are verified in terms of their content, prices, and arithmetic. When an invoice is posted, the invoice data is saved in the system. The system updates the data saved in the invoice documents in Materials Management and Financial Accounting. Logistics Invoice Verification is closely integrated with the components Financial Accounting (FI) and Controlling (CO). It passes on the relevant information about payments or invoice analyses to these components. LIV has the following features: It completes the material procurement process, which started the purchase requisition and resulted in a goods receipts It allows invoices that do not originate in materials procurement (such as services, expenses, course costs) to be processed. It allows credit memos to be processed, either as invoice reversal or return deliveries. On receiving an invoice, the information contained is entered in the system, comparing the date (such as quantities and values) suggested by the system with that in the invoice and makes the necessary corrections. The invoices are then posted. In the System, a distinction is made between the following types of invoices: Invoice with purchase order reference All the items in a purchase order can be settled. With purchase-order-based Invoice Verification, all the items of a purchase order can be settled together, regardless of whether an item has been received in several partial deliveries. Invoices with goods receipt reference Each goods receipt is settled separately. Invoices without purchase order reference Invoices can be posted directly to GL accounts or material accounts. On receiving an invoice, enter the data in the system, and save the invoice document. The system does not make any postings. The parked document can be changed. Once the changes have incorporated, the document is parked. PROCESS DECIDED:
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There will be two types of invoice verifications, one for the vendor who has supplied the material and the other is for freight/ delivery cost / customs / clearing agents/services. Invoice verification will be performed with reference to a Purchase Order or a Delivery Note, based on provision created at the time of Goods receipt. Invoice verification can be done after goods receipt. Any cost, which needs to be loaded on the inventory, should be incorporated in the purchase order as a part of price. The payment due date, for the vendor will be calculated from the invoice date which should be entered at the time of invoice verification. The provision for payment to the vendor will be created for the quantity entered in the system at the time of goods receipt and not for the quantity mentioned by the vendor in his delivery note/Invoice. BENEFITS: Reduction in co-ordination and paper work Invoice Verification not possible without purchase order and goods receipt Amount in purchase order proposed at the time of Invoice Verification for the quantity received Amount in purchased order proposed at the time Invoice Verification for the quantity received. Single Invoice Verification for multiple GR possible Lock for double invoice
REPORTS
Daily Materials Issues Daily Materials Receipt Daily Finished Goods Stock Monthly Material Receipt Monthly Issues Monthly Finished Goods Stock Physical Inventory Report Slow Moving Goods Report Dead Stock Report Monthly Scrap report
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Monthly cost center wise expenditure analysis Open purchase order Monthly purchasing value
GAP ANALYSIS
1. Internal Material No. Initial two char. should be material type with alphabets like MATERIAL TYPE NUMBER RANGE DESCRITION RM0001 TO RAW MATERIALS RM9999 PACKING PM0001 TO MATERIALS PM9999 SPARES SP0001 TO SP9999 PA0001 TO PAINTS PA9999 FG0001 TO FINISHED GOODS FG9999 CO0001 TO CONSUMABLES CO9999 PIPE LINE PI0001 TO MATERIALS PI9999 SEMI FINISHED SF0001 TO MATERIALS SF9999 2. Purchase Order output should be on existing format of the client i.e., Companys Logo, Terms & conditions should come at backside of the purchase order like 3. Open purchase order report month-wise.
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Po No. Date Description Quantity Total Value
4. Returnable Transport Packaging (RTP) stock list to be created.
PURCHASE ORDER
ABC TEXTILESINDIALTD
UPPAL INDUSTRIAL ESTATE, HABSIGUDA, HYDERABAD 500007
Ph No. 040 22334455/56/57 FAX No. 040 22334458 E-mail:
website: - www.ATIL.com P.O. No. : Date : Our Ref. No & Date : Your Qt. No. & Date : P.R. No. & Date : Rate/ Unit Amount
-stores@ATIL.com
To
Sir, Please supply the following materials as detailed below: Sl. Mat. Quantity Material Description U.O.M Packing No. Ref. No. Required
A.P.G.ST. NO. C.S.T. NO. VAT NO. TIN NO. C.E. REG. NO. E.C.C. NO. P.A.N. NO. C.E. RANGE NO. DIVISION NO. COLLECTORATE TOTAL VALUE IN (WORDS): Inco Terms Delivery Period
Discount % Cenvat % Cess % Cust. Duty % Add. Duty % VAT % P&F Transp. Charges Insurance Others if any Others Terms & Conditions if any. ABC TEXTILES(INDIA) LIMITED AUTHORISED SIGNATORY
Payment Terms Declaration For All disputes shall be settled under Hyderabad (India) Jurisdiction only Page 81 of 207
TERMS AND CONDITIONS: 1. The delivery date of the materials is from the date of issuance of Purchase Order item wise. 2. Terms and condition for payment is valid as per agreed PO terms and conditions. 3. The Purchase Order will be treated as cancel after surpassing two weeks of delivery date. 4. 5. Any damage found on delivery of goods will be return back immediately. Goods supplied should accompany necessary documents.
6. The bill for the supplied item should be submitted on/by third Saturday of the month. 7. Photocopy/copy of purchase order should be attached along with the Challan and the bills.
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GOODS RECEIVED NOTE (Raw material / Packing Material / Eng. / Spares / Cons. / Others)
Supplied by : . .. .. Serial No. Date P.O. No. Date D.C No. Inv. No. Date Transport LR No. Vehicle No. Received Quantity Accepted Quantity Rejected Quantity Remarks
Sl. Material No. No.
Description
U. O. M
Doc. Quantity
Other Remarks if any :
Prepared by
Stores In charge
Inspected by
Approved by
Plant Incharge
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DAY RECEIPTS :
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RECEIPTS
Sl No. Material Description U.O.M Quantity Supplied Inv./D.C No. P.O No. Supplied by
Date G.R.N No.
: Remarks
Prepared by
Stores In charge
DAY ISSUES :
ISSUES
Date :
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Sl No.
Material Description
U.O.M
Quantity Issued
Issue Slip No.
Remarks Date Inv. No. Remarks
FINISHED GOODS POSITION

Sl. Product No. No. Description U.O.M Opening Receipts Transf./ Closing balance Sold balance
Prepared by Prepared by Stores Incharge
Stores In charge
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FINISHED GOODS TRANSFERS/ SALES (DAY)
Date :
FINISHED GOODS POSITION

Sl. No. Product No. Description U.O.M Opening balance Receipts Transf./ Sold Closing balance Inv. No. Remarks
Prepared by
Stores In charge
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MATERIAL MONTH REPORTS
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ABC Textiles India Ltd. MONTH RECEIPTS :
RECEIPTS FOR THE MONTH OF .

MATERIAL STOCK POSITION FOR THE MONTH ENDED .. Material U.O.M Quantity Inv./D.C Supplied by G.R.N Remarks Description Supplied No. No. Material Description U.O.M Opening Receipts Issues Closing Remarks No. No. balance Quantity Quantity balance Sl No. Sl
Prepared by Prepared by
Stores In charge
Plant In charge Stores In charge
MONTH REPORTS - MATERIALS
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MATERIAL STOCK POSITION FOR THE MONTH ENDED ..
Sl No.
Material No.
Description
U.O.M Opening Receipts Issues Closing balance Quantity Quantity balance
Remarks
Prepared by
Stores In charge
Plant In charge
MONTH RECEIPTS :
RECEIPTS FOR THE MONTH OF .
Date
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Sl No. Material Description U.O.M Quantity Inv./D.C Supplied No. Supplied by G.R.N No. Remarks
FINISHED GOODS MONTH REPORT
FINISHED GOODS POSITION FOR THE MONTH ENDED ..
Sl Product No. No.
Description
U.O.M Opening Receipts Sales Closing balance Quantity Quantity balance
Remarks
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Prepared by
Stores In charge
Plant In charge
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Business Blueprint PRODUCTION PLANNING AND CONTROL

OF
ABC TEXTILESINDIA LTD.
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TABLE OF CONTENTS 1.0 1.1 1.2 INTRODUCTION PURPOSE SCOPE 1.2.1 MASTER DATA 1.2.2 PRODUCTION PLANNING 1.2.3 MATERIAL REQUIREMENT PLANNING 1.2.4 PRODUCTION ORDER 1.2.5 CAPACITY PLANNING & SCHEDULING BUSINESS BENEFITS 1.3.1 GENERAL 1.3.2 PP RELATED ORGANIZATION 2.1 2.2 2.3 2.4 3.0 4.0 GENERAL EXPLANATION NAMING CONVENTION DEFINATION OF ORGANIZATION UNITS CROSS APPLICATION/CENTRAL ORGANIZATIONAL UNITS
1.3
2.0
MATERIAL GROUPNG FINISHED PRODUCT MASTER DATA 4.1 BILL OF MATERIAL 4.2 WORK CENTER 4.3 CAPACITY PLANNING 4.4 ROUTING PRODUCTION PLANNING 5.1 SALES & OPERATIONS PLANNING 5.2 DEMAND MANAGEMENT MATERIAL REQUIREMENT PLANNING 6.1 MRP CONTROL PARAMETERS 6.2 MRP OUT PUT 6.3 CONSUMPTION BASED PLANNING 6.4 PLANNED ORDERS PROCESSING SHOP FLOOR CONTROL PRODUCTION ORDER PRODUCTION ORDER CREATION
5.0
6.0
7.0 7.1 7.2
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7.3 7.4 7.5 8.0 9.0 RELEASE OF PRODUCTION ORDER ORDER CONFIRMATION PRINT OUT OF PRODUCTION ORDER REPORTS GAPS 9.1 IDENTIFICATION OF GAPS 9.2 ADDRESSING OF GAPS ANNEXURE - 1 ANNEXURE - 2
INTRODUCTION: 1.1 PURPOSE
The purpose of the Business Blueprint is to document the detailed System and Business Process Requirements and to implement the SAP R/3 System based on those by ABC TEXTILESIndia Limited. This document summarizes the proposed decisions associated with implementation as they relate to the configuration of SAP.
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1.2 SCOPE
The Implementation Scope includes the following SAP R/3 Sub-Modules in Production Planning: 1.2.1 MASTER DATA Material Master Bill Of Material Work Center Routing Production Versions Production Resource Tools
1.2.2 PRODUCTION PLANNING Sales & Operations Planning Demand Management Planning Strategies 1.2.3 MATERIAL REQUIREMENT PLANNING MRP Procedures MRP Control Parameters MRP Out Put Consumption Based Planning Planned Orders Processing 1.2.4 SHOP FLOOR CONTROL 1.3 Order Control Goods movement Confirmation
BUSINESS BENEFITS
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1.3.1 General SAP will provide Access to Real-Time, On-Line Information with timely Processing. SAP will offer stronger, more robust Reporting Tools. SAPs Integrated Database eliminates the need for data replication and stand-alone systems, while decreasing the chance for human errors. This will reduce non-value added work while improving overall data integrity and give broader information access. SAP is Packaged Software, which is readily scalable. As such, the SAP Software will serve as a facilitator of future growth. 1.3.2 PP-Related The SAP System will provide the following PP related main business benefits: Entire Production Planning and Control process will be captured for the first time in a computerized SAP R/3 system.
Material requirement planning will be performed through a much accurate MRP run process in SAP. Material will be planned from the finished products till the raw material stage. For the Material Type Production resources, consumables and tools, consumption based planning will be undertaken. Scrap outcome of the production process will be accounted through the SAP system automatically and sent to scrap store. Capacity planning, Production scheduling with the shift sequence will be performed through SAP. Product Costing to be obtained through SAP. Standard SAP reports will be generated for all production processes. All the Work Centers in PP are assigned to Cost center. All the production costs will automatically get accumulated in the cost centers. All the PP master data will be loaded on to the system resulting in generation of the planned costs of the production processes. Actual production can be confirmed in the system, which will generate the actual costs. Variance in the planned and actual costs can be identified and the desired improvements can
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be effected in order to improve and further control the production process. This is only possible through the integration of the various modules. 2.0 ORGANIZATION 2.1 General Explanation
In SAP an organizational structure consists of the following units: Client Company code Plant Storage location Purchasing organization Sales organization The client is the top level. Several company codes can be assigned to it. In turn, several plants can be assigned to a company code, and several storage locations assigned to a plant. 2.2 Naming Convention
Proposed Organization structure for ATIL is as follows: Company Company Codes Plants Cotton Mills Polyester Mills Mlange Mills ATIL APCL, APML
APCM APPM APMM Plant MP00 RM00 RM01 PM00 FG00 BP00 SP00 SC00 RM02 ---PM01 FG01 BP01 SP01 SC01
Storage Locations For Plants CP00 & PP00 Raw material (Cotton) Raw material (Polyester) Packing Material Finished Goods Byproducts Spares Scrap
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2.3 Client In commercial, organizational, and technical terms, self-contained units in an R/3 System with separate master records and its own set of tables. A client can, for example, be a corporate group. Definition of Organizational Units
Company Code The smallest organizational unit for which a complete self-contained set of accounts can be drawn up for purposes of external reporting. This involves recording all relevant transactions and generating all supporting documents for financial statements such as balance sheets and profit and loss statements. A company code can, for example, be a company or subsidiary. Plant An organizational unit serving to subdivide an enterprise according to production, procurement, maintenance, and material planning aspects. It is a place where either material is produced or goods and services provided. Storage Location An organizational unit allowing differentiation between the various stocks of a material in a plant.
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Organization Structure- Production Planning, ABC TEXTILESINDIA LIMITED:
Company - ATIL
APCL
APML
APCM
APPM
APMM
RM00
RM01
PM00
BP00
FG00
SP00
SC00
RM02
PM01
BP01
FG01
SP01
SC01
2.4
CROSS-APPLICATION/CENTRAL ORGANIZATIONAL UNITS
General Explanation An organizational unit serving to subdivide an enterprise according to production, procurement, maintenance, and material planning aspects. It is a place where either material is produced or goods and services provided.
All data that is valid for a particular plant, as well as for the storage locations belonging to it, is stored at plant level. This includes, for example, MRP data
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and forecast data.
Naming Convention It is being proposed that the following number of plants will be created 1. 2. 3. Cotton Mills Polyester Mills Mlange Mills Plant Code-APCM Plant Code-APPM Plant Code-APMM
Definition of Organizational Units An organizational unit serving to subdivide an enterprise according to production, procurement, maintenance, and material planning aspects. It is a place where either material is produced or goods and services provided. Assignment of Organizational Units All data that is valid for a particular company code, as well as for the plants and storage locations assigned to it, is stored at company code level. This includes, for example, accounting data and costing data if valuation is at company code level. Changes to existing Organization It had been proposed that two plants be created (APCM, APPM) and assigned to the company code APCL and one more plant be created (APMM) and assigned to the company code APML. Various storage locations for Raw material, Packing Material, Finished goods, By-products, Spares and Scrap will be created and assigned to each plant.
CALENDAR Requirements/Expectations Factory calendar needs to be maintained in the system. In this the working days are to be defined and the holidays. This information is used in various modules. Country wise calendars are already maintained in the system. The ATIL factory calendar will be created with the Id ( ). The following holidays are required to maintained specific to ATIL: (T. Code - SCAL)
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See: ANNEXURE - 2 Sankranti 14 th January Republic Day 26 th January Ugadi May Day 01 st May Independence day 15 th August Ganesh Chadhurti 15 th September Gandhi jayanti 02 nd October Vijaya dashmi Diwali Ramzan The Factory Calendar needs to be updated each year based on the decided holidays. The Factory Calendar acts as the basis for Capacity Planning as it defines the working days in a year. In SAP there are two types of holidays,. Holidays are to be created as Public Holidays and then assigned to the Holiday calender than holiday calender is to be asssigned to factory calendar. UNITS OF MEASUREMENT Requirements/Expectations Units of measure are required to facilitate the procurement and management of various items in multiple order units. General Explanations The unit of measure is utilized to describe the unit in which items are procured or stored. There are over 220 different units of measure provided by SAP. System Configuration Considerations Units of measure to be used must be entered in the Purchase Requisition and Purchase Order in SAP. Special Considerations Units of measure that have been used in the past will be configured in SAP if they do not exist already.
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3.0 MATERIAL GROUPING:
The following material grouping has been defined for the materials at ABC TEXTILESIndia Limited in the SAP. The Material Grouping is for the Reporting purpose. GROUPING LOGIC: FINS RAWM PACK PNTS SPAR CONS PIPE FINISHED PRODUCT RAW MATERIAL PACKING MATERIAL PAINTS SPARES CONSUMABLES PIPE LINE MATERIAL
MATERIAL CODING SYSTEM Coding Logic for the materials in ATIL: The following material coding system is defined for all materials at ABC TEXTILESINDIA LIMITED: Total number of digits will be 10 for all material types CODING LOGIC FOR MATERIALS AT ATIL: FINS (NUMERIC PART) FINS (NUMERIC PART) XXXX XXXXXX RAWM (NUMERIC PART) RAWM (NUMERIC PART) PACK (NUMERIC PART) PACK (NUMERIC PART) PNTS (NUMERIC PART) PNTS (NUMERIC PART) SPAR (NUMERIC PART) SPAR (NUMERIC PART) CONS (NUMERIC PART) CONS (NUMERIC PART) Page 103 of 207 PIPE (NUMERIC PART) PIPE (NUMERIC PART)
Integration MM model consultants will create the material master. General notes: In plant APCM the raw material cotton and the Fished products will be handled in Batches. --------------------------------------------------------------------------------------------------------------------MASTER DATA 4.1 Bill of Materials:
Bills of material are formally structured list of all the components required to produce a finished product. The list contains the object number of each component, together with the quantity and unit of measure. Multiple BOM One product can be manufactured from alternative combinations of materials depending on the quantity to be produced (lot size). The product is represented by a number of alternative BOMs (alternatives). The differences between the alternative BOMs are only small. Usually the only difference is in the quantity of individual components We will be using Multiple BOM for 100% cotton yarns as same product needs different packaging types i.e. Carton and pallet packing of 1x20 and 1x40 pallet packing (size of container). A multiple BOM groups together several BOMs that describe one object (for example, a product) with different combinations of materials for different processing methods. Plant -APCM 100% cotton yarn group, Share of materials in product group:
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1. 30s 100% cotton combed hosiery yarn: 56% 2. 40s 100% cotton carded hosiery yarn: 15% 3. 30s 100% cotton carded warp yarn: 3% 4. 30/2s 100% cotton carded warp yarn: 26% All the material will be manufactured as per customer requirement and / or as per sales operation planning (SIS, CO_PA or forecast are used for planning the quantities). These materials will be packed in three different packaging as per requirements, namely, cartons, 1x40 pallets and 1x20 pallets. For all above materials Multiple BOM will be created as follows: Alternative BOM 1 Carton packing. Alternative BOM 2 1x40 ft pallet packing. Alternative BOM 3 1x20 ft pallet packing. Selection of Altenative BOM: During the MRP run only the Alternative BOM 1 will be selected by default. System deficit the following suggestion may be followed: 1. During the MRP run (T.CODE MD01/MD02) the Alternative BOMs are selected. 2. Automatically on the basses of Lot-size (if Lot-size maintained). 3. After MRP run and converting the planned order to Production order Alternative BOM - 2 or Alternative BOM - 3 may be selected manually by MRP controller through Read PP master data. 4. Three different material code may be used for individual packaging - carton, 1x40ft pallets and 1x20ft pallets, these materials may be planned separately during MRP run. 5. All the packaging materials may be planned as Consumption Based Planning (CBP), so, that the requirement of packaging materials may be planned depending upon safety stock level during MRP run. 6. Three Production versions may be created for different packages and during MRP run or Stock/requirement evaluation (MD04 screen) different production version may be selected as per requirement manually by MRP controller.
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7. If planning is carried out based on percentage allocation to Production versions Quota arrangement may be maintained and during MRP run automatically the planned quantity may be splited into different production version quantities. If required the plan can be changed afterwards manually to suit specific requirements, i.e. we can manually change production version through MD04 -Stock/requirement list screen. 8. All type of packing material (i.e. Carton, 1x40 & 1x20 ft pallets) may be included in One BOM and MRP may be run after wards, unwanted type of packing material may be deleted by MRP controller manually. In our case the step 6 followed, Production versions and Quota arrangement will be created as follows: Example: Product: 30s 100% cotton combed hosiery yarn. Production Version 0001 Production Version 0002 Production Version 0003 Carton packing 1x40ft pallet packing 1x20ft pallet packing Alternative BOM 1 Alternative BOM 2 Alternative BOM 3 70%Quota 20%Quota 10%Quota
Alt BOM 3 prod.ver 3 Alt BOM 2 Prod.ver 2
Alternative BOM: One finished product with different BOM item:
Alt BOM 1 Prod.ver 1
1x20ft pallets 1x40ft pallets Carton packing
Cotton
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Plant APPL 100% polyester yarn group, Share of materials in product group: 1. 30s 100% PSF Semi-finished yarn: 2. 30s 100% AUTO CONED PSF yarn: 29% 3. 30s 100% PSF NON-AUTO yarn: 71% 4. 30/2s 100% PSF yarn The first finished product (i.e., 30s 100% PSF yarn) has two production versions.
Two BOMs will be created one for each production version and production is as per Quota bases. Production version 0001 0002 BOMs Alternative 1 Alternative 2
BOM (main) item Polyester staple fiber
Material Quota 29% 71%
Production line Prod_01 Prod_02
Indorama Reliance
The BOM (main) item i.e., Polyester staple fiber has two vendors: Reliance and Indorama depend on availability the item is selected in both the production versions. So, we will create Alternative item group for this item in BOM as follows:
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Production version 0001 0002 BOMs Alternative 1 Alternative 2 Polyester staple fiber Indorama Reliance Reliance Indorama Priority first second first second
For 30/2s 100% PSF yarn: Separate BOM will be created for 30/2s 100% PSF yarn with 30s 100% PSF semi-finished yarn, no production versions for this product. Plant - APMM Mlange yarns product group, with respect to Sales Orders only: 1. 20s APSCV-4438F (INDIGO SHADE) 2. 24s APSCV-4438F (INDIGO SHADE) 3. 34s APSCV-4438F (INDIGO SHADE) 4. 40s APSCV-4438F (INDIGO SHADE)
5. 20s APSPC-4450A (MID-CHARCOL SHADE) 6. 24s APSPC-4450A (MID-CHARCOL SHADE) 7. 34s APSPC-4450A (MID-CHARCOL SHADE) 8. 40s APSPC-4450A (MID-CHARCOL SHADE) 9. 20s APSC-3841 (GREEN SHADE) 10. 24s APSC-3841 (GREEN SHADE) 11. 34s APSC-3841 (GREEN SHADE) 12. 40s APSC-3841 (GREEN SHADE) 13. 20s APSPC-4755D (OLIVE-GREEN SHADE) 14. 24s APSPC-4755D (OLIVE-GREEN SHADE) 15. 34s APSPC-4755D (OLIVE-GREEN SHADE)
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16. 40s APSPC-4755D (OLIVE-GREEN SHADE) Variant BOM The term "variant" refers to changes to the basic model of a product. These changes occur when components are left out or added. If you are producing several similar products that have a lot of common parts, you can describe these products using a variant BOM. This is the case, for example, if you replace one material component with another to make a different product. Variants can also differ by containing different quantities of a component. You create the new BOM as a variant of an existing BOM. In APMM Plant variant BOM will be created as the final products vary with only the shade color keeping other BOM items similar. As the entire above product BOMs differs in shades (color) and little variation in raw material type and quantities, we will be creating Variant BOMs for these products as follows:
Variant BOM: All variants are different finished products.
Variant 4 OLIVE GREEN Variant 3 GREEN
Variant 1 INDIGO
Variant 2 MID_CHARCOL
Cotton (OLIVE REEN) Cotton (GREEN) Cotton /polyester /viscose (MID_CHARCOL)
Packing materials
Cotton (INDIGO)
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The following Variant BOM will be created for Plant APMM:
Finished product 20s APSCV-4438F (INDIGO SHADE) 34s APSCV-4438F (INDIGO SHADE) 20s APSPC-4450A (MID-CHARCOL SHADE) 34s APSPC-4450A (MID-CHARCOL SHADE) 20s APSC-3841 (GREEN SHADE) 34s APSC-3841 (GREEN SHADE) 20s APSPC-4755D (OLIVE-GREEN SHADE) 34s APSPC-4755D (OLIVE-GREEN SHADE)
BOM Variant 1 Variant 2 Variant 3 Variant 4 Variant 5 Variant 6 Variant 7 Variant 8
Material allocation 24s APSCV-4438F (INDIGO SHADE) 40s APSCV-4438F (INDIGO SHADE) 24s APSPC-4450A (MID-CHARCOL SHADE) 40s APSPC-4450A (MID-CHARCOL SHADE) 24s APSC-3841 (GREEN SHADE) 40s APSC-3841 (GREEN SHADE) 24s APSPC-4755D (OLIVE-GREEN SHADE) 40s APSPC-4755D (OLIVE-GREEN SHADE)
ESSENTIAL PRODUCTION WASTE The essential waste generated in the production process will be included as by-products in the Bill of material (with minus sign of quantities). The same will be sent (scrap confirmation) to the by-products storage location periodically. For inclusion in the bill of material, material numbers have been defined for the different types of by-product and scrap generated in production for all the plants. (If nessasary By-products will be backflushed to By-product storage location)
Requirements/Expectations
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To define a uniform BOM applicable to both Production, Costing and inventory management functionality of the organization. The same BOM will be used in various functionality's of Production say for example; BOM explosion during Production planning MRP run. BOM explosion during production confirmation while back flushing. Naming/Numbering Conventions Each BOM for a finished product will have the finished product code as the header. Description of Functional Deficits In some cases both Variant and multiple BOM are required for production. For example certain product will be a variant BOM with reference to a BOM, which represent the most standard BOM of that product. As in SAP it is not possible to have both variant and multiple BOM for the same header material it is required to decide which functionality (Variant/ Multiple) is required to greater extent and then accordingly choose one of them and manage without other functionality. Authorization and User Roles The functions of BOM creation, Change, Deletion will be available only with the designated person/group of person within each plant. Similarly display mode is available for end-users working on the functionality.
Bills of Material in Production Planning BOM is used in MRP to calculate economical order quantity for particular point in time. It is used in production order for planning of material provision. It is also used in work scheduling (Routing) as the base for operation planning and production control. INTEGRATION
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The data stored in bills of material is also used in other activities in a company such as: Material Management (MM): Reservation and goods issue Finance and Controlling (FI / CO): Product costing To calculate the costs of materials required for a specific product ----------------------------------------------------------------------------------------------------------------
4.2
WORK CENTER
Requirements/Expectations The work centers represent the different processing centers or production line responsible for the production of the finished product. Processing of the work centers involves the maintenance of the following data: Basic Data Default Values Capacity data Scheduling data
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Costing data.
Operations are carried out at a work center. It is categorized as follows Machines, machine groups Production lines Employees, groups of employees
General Explanations The work centers represent the different processing centers or production line responsible for the production of the finished product. The work center master data is divided into different screens like, basic data, capacity overview, capacity header, scheduling, cost center, defaults etc. The different screens are controlled by the work center category, whereas the capacity data is differentiated according to the capacity category. The basic data view includes the description of the work center, the task list usage and the standard value key. The usage describes the usability of the work center in routings or other task lists. The standard value key supports the parameters, which represent the individual operational segments like set up, machining and labor etc. The capacity view contains all the data for the availability of the capacity and the different formulas for the capacity requirement calculation. The scheduling view contains the scheduling data. The cost center view contains the costing data. Naming/Numbering Conventions Each work center would be identified by their alphanumeric codes. In ATIL the work center code given as per Machine manufacture name and Model. Special Organizational Considerations All the work centers in ATIL are in three plants APCM, APPM, and APMM. The work centers that will be created as production lines (work center category -0007) are for APPM Plant and as individual machines for other two plants.
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Each of these work centers will have capacity data, scheduling data and a cost center attached to it. Changes to existing Organization After implementation of SAP the plants has to adapt to the new work enter codes/production lines codes as proposed to be used in the system, and capacity evaluation, production scheduling and routing to be based on the defined work centers/lines. Description of Improvements Maintaining the work center master data is critical for routing and scheduling production. However, this data can also be used for different analyses including capacity evaluation, rough-cut capacity planning etc. Because of the central availability of the data, different business applications can access this data and redundant data maintenance is avoided. Authorization and User Roles Authorization of Work center creation edition or deletion will be as per the authorization matrix in Annexure.
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Person responsible for work center:
General Explanation The person or a group of people who are responsible for maintenance of master files work center. Naming Convention Within each of the three manufacturing divisions there will be separate person responsible based on the section. One person will be made responsible for each of these areas. Definition of Organizational Units ATIL has three manufacturing divisions. They are Cotton Mill, Polyester Mill and Mlange Mills. In each of these manufacturing divisions will have separate persons responsible for each Work Center. 4.3 CAPACITY
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Capacity planning comprises the following partial components: Capacity evaluation In the capacity evaluation, available capacity and capacity requirements are determined and compared with each other in lists or graphics. Capacity leveling The objectives of capacity leveling are: Optimal capacity commitment Selection of appropriate resources In most applications, you can use two types of planning table (graphical and tabular versions) to display the capacity situation and to carry out capacity leveling. The Following are the work centers: COTTON MILLS (APCM): Customized in SAP WORK CENTRE NAME MIXING TRU_BR01 TRU_BR02 TRU76001 TRU76002 CHERRYBR CHERRYFR CHHL100 CHVC300A LRLK54 ZIN660 WORKCENTRE CATEGOR Y 0004(Labor Group) 0001(Machine) 0001(Machine) 0001(Machine) 0001(Machine) 0001(Machine) 0001(Machine) 0001(Machine) 0001(Machine) 0001(Machine) 0001(Machine)
DESCRIPTION MIXING BLOWROOM BLOWROOM CARDING CARDING DRAWING DRAWING HI-LAP COMBERS COMBERS SIMPLEX
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ZIN321E MURATA7V MUR21C HAMEL TFO XORELLA PACKING AUTOPACK RING FRAME AUTO CONER AUTO CONER PARALLEL WINDER CONDITIONING PACKING PACKING 0001(Machine) 0001(Machine) 0001(Machine) 0001(Machine) 0001(Machine) 0004(Labor Group) 0004(Labor Group)
TWO FOR ONE TWISTER0001(Machine)
POLYESTER MILLS (APPM): In the Polyester Mill the production is carried out in two lines as below for 30s 100% PSF Semi-finished yarn: Production Line Prod_01 Production Line Prod_02 For the above work center, the work center category is Production Line (0007). Other work center after spinning stage will be created for below finished materials 30s 100% AUTO CONED PSF yarn 30s 100% PSF NON-AUTO yarn Packing - work center caterory Labor group(0004) Murata7v work center caterory Machine (0001) RJK work center caterory Machine (0001) 30/2s 100% PSF yarn: For processing the above material the needed work centers Hamel & TFO located in plant APCM. MELANGE MILLS (APMM) Customized in SAP WORK CENTRE NAME MIXING DESCRIPTION MIXING WORKCENTRE CATEGORY 0004(Labor Group)
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LR_BR01 LR_BR02 LR_BR03L LRC1/3 LRC1/3L TRUTZ780 RSB851 LRDO2S LRLF1400 LRG5/1 AC_238 XORELLA PACKING BLOWROOM BLOWROOM BLOWROOM CARDING CARDING CARDING DRAWING DRAWING SIMPLEX RING FRAME AUTO CONER CONDITIONING PACKING 0001(Machine) 0001(Machine) 0001(Machine) 0001(Machine) 0001(Machine) 0001(Machine) 0001(Machine) 0001(Machine) 0001(Machine) 0001(Machine) 0001(Machine) 0001(Machine) 0004(Labor Group)
SHIFT AND SHIFT SEQUENCE The available capacity of a shift is defined by the following data: Shift start, shift end and break times,Capacity utilization rate,Number of individual capacities. Shift start, shift end and break times can be manually maintained in capacity. You can however also use shift (interval of available capacity). Shift definition In a shift definition you define the start, finish, break times, and validity period of a shift. Shift sequence In a shift sequence, you define how shifts follow another on a daily basis for the duration of a Cycle. You use shift definitions to do this .
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See: ANNEXURE I The following graphic illustrates the principle of shift definitions and shift sequences:
INTEGRATION Human Resource (HR) A Logistics work center can be assigned to either an organizational unit or a work center in the Human Resource Management System (HRMS). Assignments to other HR-objects, for example employees or qualifications, can be maintained via the HR work center.
Finance and Controlling (FI / CO) Costing Formulas are entered in the work center, so that the costs of an operation can be calculated. A work center is also assigned to a production cost center and the production cost center has been assigned to appropriate activity types. The prices for these activity quantities are calculated using the activity prices.
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-------------------------------------------------------------------------------------------------------------------4.4 ROUTING
Routings enable you to plan the production of materials (products). Therefore, routings are used as a template for production orders and run schedules as well as a basis for product costing. Requirements/Expectations Routings are used as a method of identifying tracking and controlling changes to product routings. Creation and editing of routings for all the materials produced in-house using discrete manufacturing. General Explanations A routing is assigned to a specific plant, which is defined in the routing header. However, you can assign individual operations of a routing to a different plant, if one or several operations are to be carried out in another plant. The plants specified in the individual operations and the one specified in the routing header must belong to the same company code. Naming/Numbering Conventions Each routing will be maintained for the finished goods, as the header material.
Special Organizational Considerations Routing are created and maintained by the Manufacturing Engineering group within each company. Current routings are very basic and do not capture material or time costs. At ATIL routings per product would be created.
ROUTING MATERIAL ASSIGNMENT
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Description of Improvements Online and close monitoring of the production, scheduling, capacity requirement calculation and costing will be done for which at present there is no system. Description of Functional Deficits Need to be able to use a standard routing for an entire class of items. Approaches to covering Functional Deficits Test system to see if functionality exists.
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PROCESS FLOW
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MIXING
CARDED YARN YARNYARYARN
BLOWROOM CARDING DRAWING - BR COMBER DRAWING - FR SIMPLEX RING FRAME AUTO CONER HAMEL TFO CONDITIONING PACKING
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DOUBLE YARN
HI - LAP
COMBED YARN

Notes on further Improvements Online and close monitoring of the production, scheduling, capacity requirement calculation and costing will be done for which at present there is no system. Authorization and User Roles Authorization of Routing creation edition or deletion will be as per the authorization matrix to be defined. Components are assigned to operations in routing from the Bill of Material of the Header material. ROUTING AT ABC TEXTILESINDIA LIMITED (ATIL) As the production scenario in ATIL is mainly discrete manufacturing so the components will move from one operation to another only in lots. So there will be sequential operations only and no overlap. However in repetitive manufacturing, where there is a single piece flow, continuous flow of material to take place between operations. ROUTING Routings enable you to plan the production of materials (products). Therefore, routings are used as a template for production orders and run schedules as well as a basis for product costing. As the production scenario in plant1 Cotton Mill and plant3 Mlange Mills is of discrete manufacturing, so normal routing is considered for the above plants (Task list Type N).
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Rate Routing A routing for whose operations the production quantity and a fixed duration has been defined. Thus the production rate is also defined. Rate routing is considered for plant 2 Polyester Mills upto semi finished satage as it involves repetitive manufacturing scenario also discreate manufacturing after semi-finished stage so, (Task list Type R) and (Task list TypeN) both will be created. INTEGRATION Material Management (MM) Plan the usage of materials Plan the external processing of operations Finance and Controlling (FI / CO) Prepare cost calculation according to routings Production Resources and Tools
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Various Production Resource Tools are used in our production process. Example: Fork lift, 5 kg weight balances ect. ------------------------------------------------------------------------------------------------------------------5.0 PRODUCTION PLANNING 5.1 SALES & OPERATIONS PLANNING (SOP)
Sales & Operations Planning (SOP) is a flexible forecasting and planning tool with which sales, production, and other supply chain targets can be set on the basis of historical, existing, and estimated future data. Rough-cut planning can also be carried out to determine the amounts of the capacities and other resources required to meet these targets. SOP is particularly suitable for long- and medium-term planning. A Rough-cut planning profile will be created for all the plants with the bottle neck work center (i.e. the spinning operation). For planning purpose, the required sales plan can be gathered from various sources like Forecasting, Sales Information Systems and CO-PA (CostProfitability analysis) or can be created manually. Based on sales plan, the production plan is created and the requirements are then transferred to demand management.
INTEGRATION Sales and Distribution (SD) SOP constitutes the planning functionality of the LIS information systems. SOP plans are passed on to Demand Management in the form of independent requirements. In turn, this data is fed to Master Production Scheduling and Material Requirements Planning. Finance and Controlling (FI/CO)
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An interface with Profitability Analysis (CO-PA) allows using CO-PA data as the basis for sales planning in SOP. SOP results are passed on to Profitability Analysis (CO-PA), Cost Center Accounting and Activity-Based Costing. 5.2 DEMAND MANAGEMENT
The function of Demand Management is to determine requirement quantities and delivery dates for finished products. Customer requirements are created in sales order management. The demand program is created in the form of planned independent requirements. Demand management uses planned independent requirements and customer requirements. Customer requirements are created in sales order management. To create the demand program, define the planning strategy for a product. Planning strategies represent the methods of production for planning and manufacturing or procuring a product. Using these strategies, it can be decided if production is triggered by sales orders (make-to-order production), or if it is not triggered by sales orders (maketo-stock production).Or, you may want both sales orders and stock orders in the demand program. If the production time is relatively long in relation to the standard market delivery time, you may want to produce the product or, at least, certain assemblies before any sales orders exist. In this case, the sales quantities are preplanned (for example, with the aid of the sales forecast). PLANT 1 COTTON MILLS (APCM) Based on the manufacturing scenario of Cotton Mills, and after thorough analysis of business process, it is found that make-to-stock, Planning with final assembly strategy (40) is best suited for the chosen products, 30s, 40s-100% cotton yarns, as both the sales order and PIRs triggers the production plan. Based on the manufacturing scenario of cotton mills, and after thorough analysis of business process, it is found that make-to-order, Planning without final assembly strategy (50) is best suited for the chosen product, 30/2s 100% cotton yarns, as the sales order triggers the production plan. PLANT 2 POLYESTER MILLS (APPM)
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Based on the manufacturing scenario of polyester mills, and after thorough analysis of business process, it is found that make-to-stock; Gross requirement planning strategy (11) is best suited for product 30s 100% psf yarns, as the production is carried out without considering the available ware house stock to achieve maximum utilization of machines. Based on the manufacturing scenario of polyester mills, and after thorough analysis of business process, it is found that make-to-order, Planning without final assembly strategy (50) is best suited for the chosen product, 30/2s 100% PSF yarns. PLANT 1 MLANGE MILLS (APMM) Based on the manufacturing scenario of Mlange mills, and after thorough analysis of business process, it is found that make-to-order, Planning without final assembly strategy (50) is best suited for the chosen product, Mlanges.
6.0
MATERIAL REQUIREMENT PLANNING
The main function of material requirements planning is to guarantee material availability, that is, it is used to procure or produce the requirement quantities on time both for internal purposes and for sales and distribution. This process involves the monitoring of stocks and, in particular, the automatic creation of procurement proposals for purchasing and production. In doing so, MRP tries to strike the best balance possible between Optimizing the service level and Minimizing costs and capital lockup. So, when MRP run is carried out using PD (normal planning) as MRP type, the PLANNED ORDERS are generated according to the demand mgmt (Planned Independent requirements). The MRP controller checks the scheduled dates of the planned orders and converts them into the production orders. Material requirements planning take current and future sales as its reference points. The planned and, depending on planning strategy, actual requirements trigger the MRP calculation. In MRP the requirements include sales orders, planned independent requirements, material reservations, the dependent requirements created by exploding the BOM and so on. In case of in-house production the system creates planned orders for planning of production quantities. When planning is complete planned orders can be converted into production orders.
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In case of external procurement the system creates either a planned order or directly creates a purchase requisition or a schedule line for a pre-existing scheduling agreement for planning the external purchase order quantity. 6.1 MRP control parameters
Various control parameters are available for the total planning procedure and for single-item planning and multi-level planning, which you can set in the initial screen of the planning run. You use these parameters to determine how the planning run is to be executed and which results are to be produced. The control parameters include: Planning run type Planning run type is Regenerative planning. Planning run type is Net change planning in planning horizon. Planning run type is Net change planning total horizon. Creation indicator for procurement proposals for materials that are procured externally For materials procured externally, purchase requisitions will be generated and for the material produced in-house, planned orders will be generated. Creation indicator for MRP lists It defines whether MRP lists are to be created or not. Planning mode Determine how the system is to deal with procurement proposals (planned orders, purchase requisitions, scheduling agreement lines) from the last planning run, which are not yet firmed, in the next planning run. Scheduling Scheduling is based on lead time scheduling. During the planning run, the system analyzes the requirements that exist for the planned materials and creates procurement elements that cover these requirements. The evaluations in the component display all receipt and issue elements for a material in the form of a table and enable you to gain a quick overview of the stock/requirements situation for the material as well as to branch into the editing function for the MRP elements for this material.
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6.2
MRP Out put The following evaluations are available for analyzing the planning result:
MRP list . Stock/requirements list. Planning result (corresponds to the MRP list with individual evaluation layout). Planning situation (corresponds to the stock/requirements list with individual evaluation layout) 6.3 CONSUMPTION BASED PLANNING
Consumption based planning is based on consumption values and uses forecasts or statistical procedures to determine future requirements. Consumption based planning is characterized by its simplicity and is mainly used for low value items. Manual reorder point planning is a typical process in consumption based planning. 6.4 PLANNED ORDER PROCESSING
Manually The MRP controller enters a planned order manually. He determines which material is to be procured, the required quantity, the date required, and whether the material is to be procured externally or internally. Automatically During the planning run, the system automatically determines the materials to be procured as well as the required quantity and the required date. After the planned order is created either manually or automatically a planned order profile is allocated and data is processed. The data would include: material, plant, order quantity and basic order dates. This will trigger the processing of material components, schedule the planned order, edit account assignment and process the source of supply. The system will check component and capacity availability and if needed, capacity leveling can be carried out. Saving the planned order creates a purchase requisition, planned load, creates dependent requirements and allows the processing of the planned order.
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7.0 7.1 SHOP FLOOR CONTROL PRODUCTION ORDER
A production order defines which material is to be processed, at which location, at what time and how much work is required. It also defines which resources are to be used and how the order costs are to be settled. The work processes within a company are executed using orders. As soon as a planned order or a company-internal requirement is generated from previous planning levels (material requirements planning) shop floor control takes over the information available and adds the order-relevant data to it to guarantee complete order processing. Production orders are used to control production within a company and also to control cost accounting. The production scheduler confirms and releases the order to shop floor for actual production. After production, operation wise confirmation of the order is carried out and relevant goods are sent (GR) into the storage location. 7.2 PRODUCTION ORDER CREATION
This function supports the production of goods in-house using the production order or work order concept. The different functions involved are: Order creation Order release Goods issues Order confirmation Goods receipt Order settlement
For creation of a production order, the data that is to be entered includes the material number of the finished good to be produced, the plant, the WO/production order number and the order type. The order type selected The properties and the control parameters are to be customized for the order type for
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that product's manufacturing. Here, among the other things it will be decided whether the WO will have external no. or internal number. Then subsequently the order quantity and the planned start or the finish dates depending on whether it is forward or backward scheduling is to be entered. At the time of order creation, the system copies the BOM and the Routing of the finished good to be produced and schedules the order. At this point of time, the system performs the availability check for the raw materials and PRTs, checks the capacity creates the and does the preliminary costing and creates the order. PROCESS FLOW During the course of the production order processing, we can track down the different data related to the scheduling, capacity utilization, material availability, preliminary costing, goods issues, order progress confirmations, tools receipt and order settlement. 7.3 RELEASE OF PRODUCTION ORDER
Release of the production order is an important business function, which controls things like the goods issue for the order, confirmation of the order progress etc. Here either individual production operations or the order itself can be released. The production order release function is to be exercised in each production order, in the transaction menu of the order header, after the creation of the production order. This function sets the "released" status in the order header After the creation of the production order, the individual operations or the order header itself can be released as per the release date specified in the material master scheduling margin key. 7.4 ORDER CONFIRMATION
A confirmation documents the processing status of orders, operations, suboperations and individual capacities. It is an instrument for controlling orders. With a confirmation you specify The quantity in an operation that was produced as yield, scrap and the quantity to be reworked How much work was actually done Which work center was used for the operation Who carried out the operation Exact confirmation shortly after completion of an operation is essential for realistic production planning and control.
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The following business transactions can be executed via confirmations: Updating order data (for example, quantities, activities, dates, status) Back flushing of components Automatic goods receipt (for one operation per order max.) Capacity reduction in the work center Updating costs based on confirmed data Updating MRP-relevant excess or missing quantities in the order You can enter confirmations for An order- to be entered daily
An operation- to be done before period closing for inventory valuation of WIP. A sub-operation An individual capacity in an operation An individual capacity in a sub-operation For scrap, rejection, reworks, operation confirmation will be done. 7.5 PRINTOUT OF PRODUCTION ORDER
This function controls the printing of the shop papers, such as the operation confirmation slips, time tickets etc. The printing of the different shop papers is controlled by the settings made in the control key attached to the individual production operations. INTEGRATION Production orders is fully integrated in the Logistics (LO) component and has, among others, interfaces to Sales and Distribution (SD) Materials Management (MM) Controlling (CO)
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PROCESSING A PRODUCTION ORDER Convert planned order to Production order T.code CO40 Availability Check
Capacity Check
Order Release CO 05
Order Print CO04N
Order Processing on Shop Floor
Order Confirmation CO15 / CO11N
Goods Receipt FG and Scrap Automatic to respective store Order Settlement Page 134 of 207
8.0
REPORTS
Following reports will be provided SHIFT WISE / DAILY PRODUCTION REPORTS MONTHLY PRODUCTION REPORTS SCRAP GENERATION REPORT The following standard reports are to be used in the Production Planning module: TRANSACTION CODE MMSC CRO5 CR06 CR07 CA60 MD73 PURPOSE This report allows a user to easily create, or view, storage location views for a material. This report produces a list of all work centers. This report produces a list of all cost center assignments. This report produces a list of all work center capacity. This report enables you to list changes to individual routing fields in the sequence which they occurred. In the "Total Requirements Display", you can check and, if necessary, change the planning figures. With this evaluation function you can list all the planned independent requirements that exist for a particular material or a product group. From this total requirements display, you can access more detailed information or you can branch into the change
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MD04 mode. In the stock/requirements list, the most up-to-date development of stocks and requirements is displayed. The layout of the list on the screen is the same as that of the MRP list. Once you have carried out the planning run for the material via single-item or total planning and where you have also specified that an MRP list is to be created, you can then display one of the lists with the function individual display. Proceed as follows: Starting from the menu screen of material requirements planning, select Evaluations -> MRP list ->Individual display. The initial screen for the Individual Display of MRP List appears. Enter the material number and the plant and press ENTER. The MRP List screen now appears with an overview of the Individual Lines. With the collective display, all planned orders which correspond to the specified selection criteria are displayed; for example, all planned orders of a certain MRP controller. The results of long-term planning are simulative planned orders at finished product level for the longterm planning version of the demand program. Simulative dependent requirements and receipts are created for the components. Simulative capacity requirements are also created for materials that are produced in-house. Separate MRP lists are also created for long-term planning. In the long-term planning menu, the stock/requirements list is also available as well as the planning situation as an individual layout. With the evaluation, "Pegged requirements", you can retrace which requirements are the source of which order proposals and which independent requirements (especially sales orders) will be affected if an order proposal is cancelled or if its date or quantity is changed. With the function, "Pegged requirements", you can determine which requirements and order proposals
MD05
MD06
MS07
MD09
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caused the current stock/requirements situation. This information is particularly useful when you have to find out which independent requirements (especially sales orders) are endangered if planned orders are cancelled or if they cannot be delivered on time. This report shows a list of production orders according to the selection criteria entered. The material produced the order schedule dates, the status of the order, and more are shown for each production order. From this list, the user can view the components and operational information for each order. This report is one that is standard delivered with the information systems, and in standard it does not include any totals listing. Using this report requires that certain info structures are active to reflect current data. This report shows a list of missing parts according to the selection criteria. You can use the missing parts information system to display the missing parts list for a selection of materials, or for all materials. It is possible to restrict your selection to a specific plant, MRP group or requirements data. The Production Order Information System offers various list types in reporting. Their layout can be adapted to suit your requirements. The information displayed in the production order information system as well as the layout of the information is controlled via an overall profile, which you can enter on the initial screen. The overall profile contains several subordinated single profiles. They contain information regarding selection criteria and layout of lists. Overall Profiles Your company may have so many materials that you will not always know whether a specific material already exists in the material master. You can find this out with the help of the materials list. Cap. Planning Evaluation by Work Centers Load Cap. Planning Evaluation by Work Centers Orders
CO20
CO24
CO26
MM60
CM01 CM02
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CM05 CM21 MCP3 MCP7 MCRE MCRI This report list displays all work centers and capacities with overload in the next 60 calendar days. This is a report of capacity leveling evaluation-work center view Report for Production order analysis Report for work center analysis Material usage analysis report Product cost analysis report
9.0 9.1
GAPS IDENTIFICATION OF GAPS The following gaps have been identified for ATIL
Shift wise production report Machine wise production report. Daily Packed production and Material stock report. Plant 3 APMM: Order wise Production in process statement (W/C stage wise status) Plant 3 Capacity planning carried out according to no. of spindles allotted per order, partial machine capacity utilized per material remaining capacity allocated to another material. How to work out.
9.2
ADDRESSING OF GAPS
The above gaps would be addressed by user exits/enhancements.
ANNEXURE I
SHIFT SEQUENCE
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Shift Start Shift I : Day Shift II : Second Shift III : Night 6:30 AM 2:30 PM 10:30 PM Shift End 2:30 PM 10:30 PM 6:30 AM Break 00 MIN 00 MIN 00 MIN Break Type Days/Week 7 7 7
ANNEXURE II Creating the public calendar, holiday calendar and Factory calendar; Customizing path: SAPNetWeaver -> General Settings -> Maintain calendar. [T.code SCAL] T.code - Public holiday SCA4_U T.code - Holiday calendar SCA5_U [Holiday calendar ID [ ] ] T.code Factory calendar SCA6_U [Factory calendar ID [ ] ] After creating the factory calendar it can be assigned to work centers.
SALES AND DISTRIBUTION BUSINESS BLUE PRINT

VERSION
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IMPLEMENTATION OF SAP R/3 FOR
ABC TEXTILESINDIA LTD
TEAM MEMBERS
ARTI JOSHI SAMATHA. J MADHURI. K SRINIVAS
Contents
1. Need for ERP 2. Scope 3. Organizational Structure 4. Master Data 5. Key Data Structure Master Data
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6. Pricing Procedure 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. Free goods Material determination Tax determination Revenue Account determination Credit management Batch Management Text Determination Log of Incompletion Items Output Determination Business Scenarios 16.1 Sale from Plant to Export market 16.2 Sale from Plant to Domestic Market 16.3 Inter Company Transactions 16.4 Third party process 16.5 Returns process 17. 18. Sales Information System Gaps
NEED FOR SAP ERP

ATILs existing sales information system ATIL is currently not using any integrated software system. Pre printed stationary such as Order book, delivery challan and bill books are used. This sales data is stored in the form of excel sheets. All accounting related mandatory data is maintained using separate accounting system. Problems in existing sales system & expectations from SAP system. Stock related problems:
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There is no reliable source to find exact stock of raw material & finished goods. Sales people have to depend on the storekeepers to know the current status of the stock, because of which the exact delivery scheduling is not possible. SAP system should provide correct status of stock. It should also provide options for scheduling sales throughout the company. Order Processing related problems: Due to manual entries of orders there are lots of mistakes by the users while duplicating of data from Quotations to Orders & so on. Due to non-availability of any Integrated System heavy wastage of time & stationary for keeping the reusable records such as Customer Address Details, Contact Details. SAP system should enable transfer of required data into different documents without mistakes. All reusable data should be readily available without investing many efforts. Billing related problems: Sales persons are not always in a position to quote exact prices to customers & offer them with discounts. Sales Reporting is not accurate & real time due to differences among Bill Books, Data maintained in Excel & accounting systems. Sales Forecasting & Sales Promotions are heavily affected due to non availability of Previous Sales Data, Real Time Sales Data. SAP system should take care of Price Determination with minimum user intervention considering product prices, taxes, discounts etc. SAP system should provide platform for Sales Analysis, Sales Forecasting that can be used for companies Sales Promotions.
SCOPE
SALES & DISTRIBUTION The complete Sales organization structure and Master data as well as the business processes will be included in the scope of the project.
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This project will include the following business processes of Sales & Distribution.
Customer Master Customer Master Info Record Material Master Customer Enquiry Contract Sales Order Delivery Billing Returns Exports
Special Process Pricing Condition Contracts / Agreements Intercompany Stock Transfer Intercompany Sales Third Party Sales Returnable Packaging
CROSS-MODULE INTEGRATION OF SALES & DISTRIBUTION MATERIAL IN SAP R/3 MANAGEMENT

FINANCIAL ACCOUNTING
SHIPPING
MATERIAL MANAGEMENT PRODUCTION PLANNING PLANT MAINTANENCE CONTROLLING FINANCIAL ACCOUNTING PROJECT SYSTEM
SALES SUPPORT
MASTER DATA
BILLING
FINANCIAL ACCOUNTIN G CONTROLLING
SALES Page 143 of 207
SALES ANALYSIS
ASIS, TOBE PROCESS OF ABC TEXTILESINDIA Ltd

Business Process Company ABC TEXTILESIndian Ltd has two operating companies. AP cotton ltd and AP mlange ltd. It runs its sales through sales departments, sales offices, and sales executives across the country and overseas. Mapping into SAP The companys organizational structure is mapped in SAP standard system is as follows: Operating Companies Company codes Sales departments Sales Organizations Sales offices Sales Offices Sales executives Sales groups In SAP standard system these 3 approaches have been mapped to Distribution Channels, Which are nothing but channels through which material or services, is reached to customer. They are as follows: Direct Direct Sales Export Export Sales Scrap - Second Sale In SAP standard system the product group have been mapped to Divisions. Division is nothing but a group or range of products.
Sales media ABC TEXTILESIndia Ltd has three various approaches where in the products of the company are reached to customers. They are Direct and Exports sales.
Product group ABC TEXTILESIndian Ltd has three main products like 100% Cotton, 100% Polyester & Mlange selling to its customers.
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100% Cotton 100% Polyester Mlange Customers ABC TEXTILESIndian Ltd has its customers in the form of Export Customers, Domestic Customers and Small Textile Industries. Materials ABC TEXTILESIndia Ltd procures most of its raw materials from farmers, cotton federations. It manufactures different counts of 100% Cotton, 100% Polyester & Mlange. Inquiry Inquiry is a customers request to the company that they provide a quotation or sales information. Once an Inquiry is received from the customer, the specifications are generally mentioned, and depending on these specifications marketing division decides whether the required product counts are available. In SAP standard system customers information is kept in master records. A customer master record is created when you start a business relationship with a new customer. In SAP Material Master Data holds all the material information. It will be maintained by MM with SD integration.
The sales area that accepts the inquiry becomes responsible for further processing. After Inquiry we create a quotation. The Inquiry is created using TCODEVA11 and sales document type IN
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Quotations The company quotes to the customer a specific price and if the offered price is acceptable to the customer the subsequent process will continue. Sales Orders After the initial negotiations the order is finalized by creating a Sales Order and the exact requirements and specifications are put down in the Sales Order and passed on to the customer for Confirmation. Quotation is used as a proposed agreement of a price and quantity, for a particular material. Quotations are created using TCODE VA21 and sales document type QT. A Sales order is a contractual agreement between a sales organization and a customer for the supply of products over a specific period of time and in certain quantities. It copies all relevant information and data from customer master and the material master records. Sales Orders are created using TCODE VA01 and sales document type OR The Deliveries are created using TCODE VL01N and delivery document type LF The outbound delivery will take care of picking, packing and goods issue.
Delivery Based on the requested delivery date by the customer, the company will deliver the stock. Outbound delivery supports all shipping activities including picking, packing, transportation and goods issue. Billing After delivering the goods, an Invoice is raised as per the delivery depending on the price. Billing is done on the basis of sales orders and deliveries, which includes Invoice, Credit and Debit memo. Credit-Debit Memo Credit memo: Credit memos are created for various reasons (for example, because of defective goods or because you have overcharged a customer) on a customer complaint. This reduces receivables in Financial
Billing can be created by Tcode VF01 and the billing document types: F1 - order related billing F2 - Delivery related billing F5 - Proforma invoice for Sales order F8 Proforma invoice for Delivery In SAP Credit Debit Memos can be created by using Billing Document types G2 - Credit memo L2 - Debit memo When you create a credit or debit
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Accounting. Debit memo: Similarly, you may need to create a debit memo, if, for example, you have not charged the customer enough. This increases receivables in Financial Accounting. Returns If the customer returns the goods a returns delivery is created and credit memo is issued to the customer. The returns document can be created with or without reference to the sales order. The goods issue posted for the return delivery records the inward movement of the goods into your own stock. Exports The Product 100% cotton that is manufactured in AP Cotton ltd is exported to the customers of Italy, Portugal and South Korea. SPECIAL SALES PROCESSES Transfer of goods between factories In this process the goods will be transferred from one factory to the other. This scenario covers stock transfer of goods from one manufacturing plant to another manufacturing plant. Contracts / Agreements This is the process with which the customer is binded to the company. Customer contracts are outline customer agreements that display when sales materials or services are sold within a certain time period. memo, you can refer to an invoice or a credit memo request.
Returns documents are created just as sales orders. We can create Returns Processing (Sales Document types) by sales document type RE
In SAP standard system the exports sales process takes place through Pre & Post Shipment activities using contracts and agreements.
In SAP standard system Inter plant stock transfer is mapped as follows: Issuing plant delivers the goods to the receiving plant by using TCode VL10B and raises intercompany invoice on the receiving plant. In SAP standard system contracts is mapped as follows: Quantity contract: It takes place after quotation and before order. They are mainly used to limit the quantity in demand by the customer and to offer special pricing.
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Value Contract: It is similar to quantity contract but the contract and its ceiling is based upon a total value. Master contract: It consists of other contracts that are grouped as lower level contracts, over a specified period. Pricing Condition The term pricing is used broadly to describe the calculation of prices (for external use by customers or vendors) and costs (for internal purposes, such as cost accounting). Conditions represent a set of circumstances that apply when a price is calculated. For example, a Particular customer orders a certain quantity of a particular product on a certain day. The variable factors here - the customer, the product, the order quantity, and the date determine the final price the customer gets. In SAP creating a pricing procedure in which we will be creating condition records can create the total Pricing conditions. The condition technique refers to the method by which the system determines prices from information stored in condition records. This can be done by using T.Code V/08 - Pricing Procedure V/06 Condition Types VK11 Maintaining Condition Records
Sales process between factories In the SAP standard system, Inter In this process the sales dept to Company sales can be mapped in which the order is placed will belong following steps. to one company, and the delivering Receiving plant passes the order factory / warehouse will belong to the other company. Then the selling sales to the delivering plant dept will bill to the other company, A customer is created in which is delivering the material. delivering plant. The delivering plant directly sends the goods to the customer and bills the receiving plant. The Receiving plant will bill the customer. We have to maintain PI01 and PI02 condition types in pricing procedure.
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Pricing should be maintained by both SD& MM. Third Party sales In this process the Company gets the orders from the customer and the purchase order passes to the third party vendor who delivers the goods to the customer and bills the Company. After the Invoice verification, Company raises the bill to its customers for the material supplied by the third party. In this process the stock will be directly supplied to the customer from the Vendor and the company will raise the Billing to the customer.
ORGANIZATIONAL DATA Sales Organization Sales Organization is an organizational unit that sells and distributes products, negotiates terms of sale, and is responsible for sales transactions. The following three Sales Organizations will be created for Project ABC TEXTILESIndia LTD. Sales Organization SOEX SOCP SOME Description Sales org. Cotton exports Sales org. Cotton and Poly. Domestic Sales org. Mlange Domestic
Distribution Channel A distribution channel is a channel through which materials or services reach to customers. The following three Distribution Channels will be created for Project ABC TEXTILESIndia LTD. Distribution Channel DD DE DS Description Direct Sales Export Sales Seconds Sale
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Division A division is a product group that can be defined for a wide-range spectrum of products. The following divisions will be created for Project ABC TEXTILESIndia LTD. Division CO PO ME SC Description Cotton Polyester Mlange Scrap
Sales Offices Sales office is defined as a physical location (for example, a branch office) that has responsibility for the sale of certain products or services within a given geographical area. The following Sales Offices will be created for Project ABC TEXTILESIndia Ltd Sales Office SOM SOK SOH Description Sales Office Mumbai Sales Office Kolkata Sales Office Hyderabad
Sales groups Sales Group is a group of sales people who are responsible for processing sales of certain products or services. By using sales groups you can designate different areas of responsibility within a sales office and also can be used for reporting purposes. The following Sales Groups will be created for Project ABC TEXTILESIndia Ltd Sales Group SGC SGP SGM SGE Description Sales group for Sales group for Sales group for Sales group for
cotton Polyester Mlange Cotton Export
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ORGANISATIONAL STRUCTURE
AP SPINNERS INDIA LTD. (APSIL)
AP COTTON LTD (APCL)
AP MELANGE LTD (APML)
SALES ORG (SOEX)
SALES ORG (SOCP)
SALES ORG (SOME)
DE
DD
DS
DD
CO
CO
PO
Sales Office SOH
SC
ME
Sales Office SOM

Sales Group Sales Group
Sales Office SOK

Sales Group Sales Group
SGE
SGC
SGP Page 151 of 207
SGM
Shipping Points The shipping point is the top level in the organization for shipping. A delivery is always initiated from exactly one shipping point. Thus, all items of a delivery belong to one shipping point. Groups of deliveries also belong to exactly one shipping point. The following Shipping Points will be created for Project ABC TEXTILESIndia Ltd Shipping Point SPBH SPDM SPMU SPRE Description Shipping point Bhongir Shipping point Deshmukh Shipping point Mumbai Returns Shipping point Deshmukh
Assign sales organization to company code This establishes a link between the SD and FI systems. A sales organization belongs to just one company code. Sales Org SOEX SOCP SOME Desc Sales org. for cotton exports Sales Org. For Cotton & Poly Domestic Sales Org. Mlange Domestic Company Code APCL APCL APML Desc AP Cotton LTD AP Cotton LTD AP Mlange LTD
Assign distribution channels to sales organization A distribution channel can be valid for several sales organizations. Sales Org SOEX SOCP SOCP SOME Desc Sales org. for cotton exports Sales Org. For Cotton & Poly Domestic Sales Org. For Cotton & Poly Domestic Sales Org. Mlange Domestic Dist Chl DE DD DS DD Desc Export Sales Direct Sales Seconds Sale Direct Sales
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Assign division to sales organization Any one division can belong to several sales organizations. Sales Org SOEX SOCP SOCP SOCP SOME Desc Sales org. for cotton exports Sales Org. for Cotton & Polyester Domestic Sales Org. for Cotton & Polyester Domestic Sales Org. for Cotton & Polyester Domestic Sales Org. for Mlange Div CO CO PO SC ME Desc Cotton Cotton Polyester Scrap Mlange
Setup Sales Areas Sales area is a combination of sales organization, distribution channel and division. The following Sales Areas will be created for Project Indian Automobiles. Sales Org SOEX SOCP SOCP SOCP SOME Desc Sales Org. for Cotton Ex Sales org for Cotton &Poly Sales org for Cotton & Poly Sales org for Cotton & Poly Sales org for Mlange Dist Channel DE DD DD DS DD Desc Export Sales Direct Sales Direct Sales Seconds Sale Direct Sales Div CO CO PO SC ME Desc Cotton Cotton Polyester Scrap Mlange
Assign sales office to sales area Any one sales office can belong to several sales areas at the same time.
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Sales Area (Sales Org + DC + DIV) SOEX + DE + CO SOCP + DD + CO SOCP + DS + SC SOCP + DD + PO SOME + DD + ME Sales Office SOM (Mumbai) SOH (Hyderabad) SOH (Hyderabad) SOH (Hyderabad) SOK (Kolkata)
Assign sales groups to sales office Any one sales group can belong to several sales offices. Sales Office SOM Sales Office Mumbai SOK Sales Office Kolkata SOH Sales Office Hyderabad SOH Sales Office Hyderabad Sales Group SGE SGM SGP SGC Desc Cotton Exports Mlange Domestic Polyester Domestic Cotton Domestic
Assign sales organization, distribution channel to plant A plant can be assigned more than once. Sales Org SOEX SOCP SOCP SOME Desc Sales Org. for Cotton Ex Sales Org Cotton& Poly Sales Org Cotton& Poly Sales Org for Mlange DC DE DD DS DD Desc Export Sales Direct Sales Second Sales Direct Sales Plant APCM APCM APCM APMM Desc 100% Cotton & Polyester 100% Cotton & Polyester 100% Cotton & Polyester Mlange
Assign shipping points to plant
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Any one shipping point can belong to several plants. Shipping Pt Desc SPDM SPMU SPRE SPRE SPBH Shipping point Deshmukh Shipping point Mumbai Returns Shipping point Deshmukh Returns Shipping point Deshmukh Shipping point Bhongir Plant APCM APCM APCM APCM APMM Desc 100% Cotton & polyester 100% Cotton & polyester 100% Cotton & polyester 100% Cotton & polyester Mlange
MASTER DATA
The system copies the plant data into the sales order from the relevant entries into the master records based upon the following properties: Customer Material Information Master Record Customer Master Record Material Master Record
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CUSTOMER MASTER DATA The customer master record is the basis for all sales transactions as well as deliveries and payments. It represents the following sales data relevant to the customer.
Business Partners In the SAP system, a business partner could be: A customer A contact person A vendor A forwarding agent An employee in the company (e.g. sales personnel) MATERIAL MASTER DATA The SALES related view of material master record consists of the following
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Customer Material Information Record Data on a material defined for one specific customer is stored in the customer material information records. This data includes the customer-specific material number, the customer-specific material description, customerspecific data on deliveries and delivery tolerances. The data in the customer material info record has priority when master data is copied into SAP. Transaction code VD51 used for creation.
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Key Data Structure for Sales and Distribution

Sales Document Types The sales document types represent the different business transactions in sales, such as inquiry processing, quotation processing, and consignment stock processing. Following sales document types have been defined for ABC TEXTILESIndia LTD. Sales document types for Company code (APCL)
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Sales Doc yp e ZIN ZQT ZOR ZRE ZCR ZDR ZRK ZSD ZFD ZPV Description Inquiry Quotation Standard Order Sales Returns Credit Memo Request Debit Memo Request Invoice Correction Request Sub Free of Item Delivery Free of Charge Item Proposal Doc Category A B C H K L K I I D
Sales document types for Company code (APML) Sales Doc Ty pe YIN YQT YOR YRE YCR YDR YRK YSD YFD YPV Description Inquiry Quotation Standard Order Sales Returns Credit Memo Request Debit Memo Request Invoice Correction Request Sub Free Of Item Delivery Free of Charge Item Proposal Doc Category A B C H K L K I I D
Number Ranges When creating a sales document, a unique number is assigned which identifies the sales document. The number comes from the number range, which is provided for the document type. There are two possible types of number assignment: Internal number assignment (Automatically assigns a consecutive number from the defined number range.)
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External number assignment (You specify a number from the external number range.)
Number ranges for sales document types (Comp code - APCL) Sales Doc Type No Range From Number To Number ZIN 1 1000001 1025000 ZQT 2 1025001 1050000 ZOR 3 1050001 1075000 ZRE 6 1125001 1150000 ZCR 7 1150001 1175000 ZDR 8 1175001 1200000 ZRK 13 1300001 1325000 ZSD 14 1325001 1350000 ZFD 15 1350001 1375000 ZPV 16 1375001 1400000 Number ranges for sales document types (Comp code - APML) Sales Doc type No Range From Number To Number YIN 17 1400001 1425000 YQT 18 1425001 1450000 YOR 19 1450001 1475000 YRE 22 1525001 1550000 YCR YDR YRK YSD YFD YPV 23 24 29 30 31 32 1550001 1575001 1700001 1725001 1750001 1775001 1575000 1600000 1725000 1750000 1775000 1800000
Reference Sales organizations Sales Org SOEX SOCP Desc Sales org. Cotton exports Sales org. Cotton Ref Sales Org SOEX SOCP Desc Sales org. Cotton exports Sales org. Cotton
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and Poly. Domestic Sales org. Mlange SOME Domestic and Poly. Domestic Sales org. Mlange Domestic
SOME
Common Distribution channels Sales Org SOEX SOCP SOME SOCP Desc Sales org. Cotton exports Sales org. Cotton and Poly. Domestic Sales org. Mlange Domestic Sales org. Cotton and Poly. Domestic Dist Chan nel DE DD DD DS Desc Exports Direct Direct Second Sale Ref Dist Chann el DE DD DD DS Desc Exports Direct Direct Second Sale
Common Divisions Sales Org SOEX SOCP SOCP SOCP Desc Sales org. Cotton exports Sales org. Cotton and Poly. Domestic Sales org. Cotton and Poly. Domestic Sales org. Cotton and Div CO CO PO SC Desc Cotton Cotton Polyester Scrap Ref Div CO CO PO SC Desc Cotton Cotton Polyester Scrap
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Poly. Domestic Sales org. Mlange Domestic
SOME
ME
Mlange
ME
Mlange
Assign sales order types permitted for sales area (APCL)

Ref. SO SOEX SOEX SOEX SOEX SOEX SOEX SOCP SOCP SOCP SOCP SOCP SOCP SOCP Desc Sales org. Cotton exports Sales org. Cotton exports Sales org. Cotton exports Sales org. Cotton exports Sales org. Cotton exports Sales org. Cotton exports Sales org. Cotton and Poly. Domestic Sales org. Cotton and Poly. Domestic Sales org. Cotton and Poly. Domestic Sales org. Cotton and Poly. Domestic Sales org. Cotton and Poly. Domestic Sales org. Cotton and Poly. Domestic Sales org. Cotton and Poly. Domestic Ref D C DE DE DE DE DE DE DD DD DD DD DD DD DD Desc Exports Exports Exports Exports Exports Exports Direct Direct Direct Direct Direct Direct Direct Div CO CO CO CO CO CO CO CO CO CO CO CO CO Sales Doc type ZIN ZQT ZOR ZRK ZSD ZPV ZIN ZQT ZOR ZRE ZCR ZDR ZRK Desc Inquiry Quotation Order Invoice Correction Request Sub Free of Item Item Proposal Inquiry Quotation Order Sales Returns Credit Memo Req Debit Memo Req Invoice Correction Request
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SOCP SOCP SOCP SOCP SOCP SOCP SOCP SOCP SOCP SOCP SOCP SOCP SOCP SOCP SOCP SOCP Sales org. Cotton and Poly. Domestic Sales org. Cotton and Poly. Domestic Sales org. Cotton and Poly. Domestic Sales org. Cotton and Poly. Domestic Sales org. Cotton and Poly. Domestic Sales org. Cotton and Poly. Domestic Sales org. Cotton and Poly. Domestic Sales org. Cotton and Poly. Domestic Sales org. Cotton and Poly. Domestic Sales org. Cotton and Poly. Domestic Sales org. Cotton and Poly. Domestic Sales org. Cotton and Poly. Domestic Sales org. Cotton and Poly. Domestic Sales org. Cotton and Poly. Domestic Sales org. Cotton and Poly. Domestic Sales org. Cotton and DD DD DD DD DD DD DD DD DD DD DD DD DD DD DD DD Direct Direct Direct Direct Direct Direct Direct Direct Direct Direct Direct Direct Direct Direct Direct Direct CO CO CO PO PO PO PO PO PO PO PO PO PO SC SC SC ZSD ZFD ZPV ZIN ZQT ZOR ZRE ZCR ZDR ZRK ZSD ZFD ZPV ZIN ZQT ZOR Sub Free of Item Del Free Of Charge Item Proposal Inquiry Quotation Order Sales Returns Credit Memo Req Debit Memo Req Invoice Correction Request Sub Free of Item Del Free Of Charge Item Proposal Inquiry Quotation Order
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Poly. Domestic
Assign sales order types permitted for sales area (APML)

Ref. SO SOME SOME SOME SOME SOME SOME SOME Desc Sales org. Mlange Domestic Sales org. Mlange Domestic Sales org. Mlange Domestic Sales org. Mlange Domestic Sales org. Mlange Domestic Sales org. Mlange Domestic Sales org. Mlange Domestic Ref D C DD DD DD DD DD DD DD Desc Direct Direct Direct Direct Direct Direct Direct Div ME ME ME ME ME ME ME Sales Doc type YIN YQT YOR YRK YSD YFD YPV Desc Inquiry Quotation Order Invoice Correction Request Sub Free of Item Del Free Of Charge Item Proposal
Item Category Item Category AFN AGN TAN TANN TATX REN G2N L2N TAS Description Inquiry Item Quotation Item Standard Item Free Of Charge Item Text Item Sales Return Item Credit Memo Request Debit Memo Request Third Party Sales
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TAB TAX PVN Individual Purchase Order Non - Stock Item Item Proposal
Item Category Group The purpose for using the item category group is you group together different material types for item category determination. For every material type, you can define a default item category group, which is proposed by the SAP System when you create a material master record. For Indian Automobiles following Item category groups are being maintained Item Category Group NORM ERLA LUMF BANS BANC Description Standard Item Header Level BOM Item Level BOM Third Party Sales Individual Purchase Order
Item Category Usage The purpose to specify item category usages is to control the usage of an item. Item category usage controls, for example, the system response if during document processing an item does not refer to a material but to a text item. Item category usage can also be maintained via the item categories. For ATIL following usages are maintained: Item Category Usage TEXT FREE Description Text Item Free Goods
Assigning Item Categories The purpose of assigning item categories is to specify which item categories the system proposes during document processing for each sales document type and item category group. The item category depends on the following criteria: Sales document type Item category group Item category usage Item category of the higher-level item
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The SAP System automatically copies the item category determined for a sales document item to the delivery. Item category assignment for APCL Sales Doc Item Cat Grp Type ZIN ZQT ZOR ZOR ZOR ZOR ZOR ZRE ZPV NORM NORM NORM NORM NORM BANS BANC NORM NORM FREE TEXT High Level Item Cat Grp ---TAN TAN Item Cat AFN AGN TAN TANN TATX TAS TAB REN PVN
Usage
Description Inquiry Item Quotation Item Standard Item Free of charge Item Text Item Third party Individual Purchase Order Sales Returns Item Proposal
Item category assignment for APML Sales Doc Type YIN YQT YOR YOR YOR High Level Item Cat Grp ---FREE TEXT TAN TAN Item Cat AFN AGN TAN TANN TATX
Item Cat Grp NORM NORM NORM NORM NORM
Usage
Description Inquiry Item Quotation Item Standard Item Free of charge Item Text Item
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YOR YOR YRE YPV BANS BANC NORM NORM TAS TAB REN PVN Third party Individual Purchase Order Sales Returns Item Proposal
Copy controls for Sales Documents The Purpose of defining copy controls is to control data for the document flow of sales documents. Here we can specify for a particular sales document type, which document type is to be assigned to copied reference documents, and which item categories or schedule line categories are to be copied. Sales Doc types to Sales Doc types for Company Code APCL: Target S Doc ZQT ZOR ZSD ZFD ZRE ZG2 ZL2 ZG2 ZL2 ZOR Description Standard Quotation Standard Order Sub. Free of charge Delivery free of charge Returns Credit Memo Request Debit Memo Request Credit Memo Request Debit Memo Request Standard Order Source S Doc ZIN ZQT ZOR ZOR ZOR ZOR ZOR ZG2 ZL2 ZOR Description Standard Inquiry Standard Quotation Standard Order Standard Order Standard Order Standard Order Standard Order Credit Memo Request Debit Memo Request Standard Order
Sales Document types to Sales Doc types for Company Code APML: Target Source Description Description S.Doc S.Doc YQT Standard Quotation YIN Standard Inquiry
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YOR YSD YFD YRE YG2 YL2 YG2 YL2 YOR Standard Order Sub. Free of charge Delivery free of charge Returns Credit Memo Request Debit Memo Request Credit Memo Request Debit Memo Request Standard Order YQT YOR YOR YOR YOR YOR YG2 YL2 YOR Standard Quotation Standard Order Standard Order Standard Order Standard Order Standard Order Credit Memo Request Debit Memo Request Standard Order
Billing Document types to Sales Doc types for Company Code APCL: Target S Doc ZG2 ZG2 ZL2 ZRK ZL2 Description Credit Memo Request Credit Memo Request Debit Memo Request Invoice correction request Debit Memo Request Source S Doc ZF1 ZF1 ZF2 ZF2 ZF2 Description Invoice Invoice Invoice Invoice Invoice
Billing Document types to Sales Doc types for Company Code APML: Target S Doc YG2 YG2 YL2 YRK YL2 Description Credit Memo Request Credit Memo Request Debit Memo Request Invoice correction request Debit Memo Request Source S Doc YF1 YF1 YF2 YF2 YF2 Description Invoice Invoice Invoice Invoice Invoice
Delivery Outbound delivery supports all shipping activities including picking, packing, transportation and goods issue. During this process, shipping-planning information is recorded, status of shipping activities is monitored and data accumulated during shipping processing is documented. The data that is generated during shipping processing is included in the delivery. Delivery Processing
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ATIL has the need to do on-line release of goods to eliminate confusion whether it be product specific, customer specific, delivery hold, etc. The delivery serves as a basis for: Planning material requirements (MRP)
Picking It is the process of grouping goods (materials) from the warehouse on the basis of sales orders, deliveries, or for staging materials for production. Packing It is a procedure in which you pack goods in a particular manner before the delivery, corresponding to the requirements of your customers. The customer requests that the materials be packed According to size or color In a certain quantity per packing element In customer defined packing elements Goods Issue The delivery forms the basis of goods issue posting. The data required for goods issue posting is copied from the delivery into the goods issue document. When the goods have left your plant, the business transaction is regarded as completed from the point of view of shipping. The material stock is reduced by the goods issue quantity and the corresponding value changes take place in accounting. This ensures that the quantity and value flows are parallel. The delivery status is updated Delivery documents used for company code APCl: Delivery Doc Type ZLF ZLR ZLO DESCRIPTION Outbound Delivery Returns Delivery Del. Without Ref. Doc Category J T J
Delivery documents used for company code APML: Delivery Doc Type YLF YLR YLO
DESCRIPTION Outbound Delivery Returns Delivery Del. Without 169 of 207 Page Ref.
Doc Category J T J
Item Category Determination for Deliveries Doc. type ZLF ZLO ZLR YLF YLO YLR Itctrgr NORM NORM NORM NORM NORM NORM Usage Hgitctr Dfitctr TAN DLN REN TAN DLN REN
Copy Controls for Delivery Documents Sales doc types to Delivery doc types for the Company code APCL: Target S Doc ZLF ZLR Description Outbound Delivery Returns Delivery Source S Doc ZOR ZRE Description Standard Order Returns
Sales doc types to Delivery doc types for the Company code APML: Target S Doc YLY YLR Description Outbound Delivery Returns Delivery Source S Doc YOR YRE Description Standard Order Returns
Billing It is a key functional area of a company that provides information about customer contracts, billing status, and accounts. It is a generic term for
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invoices, credit memos, debit memos, proforma invoices, and cancellation documents. Billing Document Configuration Check billing block Select type of invoice creation Create billing document from delivery / sales order Determine billing prices and taxes Billing document relevant to accounting created Send billing document Billing Documents Billing documents used for the Company code APCL: Billing Type Description ZF2 ZG2 ZL2 ZLG ZLR ZLRS ZS3 ZF5 ZF8 ZF1 Invoice Credit Memo Debit Memo Credit Memo List Invoice List Cancel Invoice List Cancellation Proforma Invoice for Order Proforma Invoice for Delivery Invoice
Billing documents used for the Company code APML: Billing Type YF2 YG2 YL2 YLG YLR YLRS YS3 YF5 YF8 YF1 Description Invoice Credit Memo Debit Memo Credit Memo List Invoice List Cancel Invoice List Cancellation Proforma Invoice for Order Proforma Invoice for Delivery Invoice
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Copy Controls for Billing Documents Sales Doc to Billing Doc for the Company Code APCL: Target ZF2 ZG2 ZL2 ZF5 ZF1 Billing Doc Type Invoice Credit Memo Debit Memo Proforma Invoice for Order Invoice Source ZOR ZG2 ZL2 ZOR ZOR Sales Doc Type Standard Order Credit Memo Request Debit Memo Request Standard Order Standard Order
Sales Doc to Billing Doc for the Company Code APML: Target YF2 YG2 YL2 YF5 YF1 Billing Doc Type Invoice Credit Memo Debit Memo Proforma Invoice for Order Invoice Source YOR YG2 YL2 YOR YOR Sales Doc Type Standard Order Credit Memo Request Debit Memo Request Standard Order Standard Order
Delivery Doc to Billing Doc for the Company Code APCL: Target S Doc ZF1 ZF1 ZF2 ZF2 ZF8 ZJX Description Invoice Invoice Invoice Invoice Proforma Invoice for Invoice Excise Invoice India Source S Doc ZLF ZLO ZLF ZLO ZLF ZLF Description Delivery Delivery without Ref. Delivery Delivery without Ref. Delivery Delivery
Delivery Doc to Billing Doc for the Company Code APML:
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Target S Doc YF1 YF1 YF2 YF2 YF8 Description Invoice Invoice Invoice Invoice Proforma Invoice for Invoice Source S Doc YLF YLO YLF YLO YLF Description Delivery Delivery without Ref. Delivery Delivery without Ref. Delivery
Billing Doc to Billing Doc for the Company Code APCL: Target ZL2 ZLG ZG2 ZLR ZLR ZLRS ZLRS ZLRS ZJX ZLR ZLRS Billing Doc Type Debit Memo Credit Memo List Credit Memo Invoice List Invoice List Cancel Inv List Cancel Inv List Cancel Inv List Excise Invoice India Invoice List Cancel Inv List Source ZF2 ZG2 ZF2 ZF2 ZL2 ZF2 ZG2 ZL2 ZF2 ZF1 ZF1 Billing Doc Type Invoice Credit Memo Invoice Invoice Debit Memo Invoice Credit Memo Debit Memo Invoice Invoice Invoice
Billing Doc to Billing Doc for the Company Code APML: Target YL2 YLG YG2 YLR YLR YLRS YLRS Billing Doc Type Debit Memo Credit Memo List Credit Memo Invoice List Invoice List Cancel Inv List Cancel Inv List Source YF2 YG2 YF2 YF2 YL2 YF2 YG2 Billing Doc Type Invoice Credit Memo Invoice Invoice Debit Memo Invoice Credit Memo
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YLRS YJX YLR YLRS Cancel Inv List Excise Invoice India Invoice List Cancel Inv List YL2 YF2 YF1 YF1 Debit Memo Invoice Invoice Invoice
PRICING
In SAP standard system we use pricing to calculate price and cost of the material by using Condition Technique. Condition Technique Condition technique is a method by which system determines the values from the information stored in condition record during sales order processing. The following factors influence condition technique: Condition Table (V/03) In a condition table, you define the combination of fields for which you can create condition records. Condition table 701 702 703 704 705 706 Description Customer price Material price Customer discount Material discount Freight Domestic taxes
Maintain Condition Type (V/06) Condition types represent Price elements in the SAP system. Price elements can be, for example, prices, surcharges, discounts, taxes or, freight, and are stored in the system in condition records. Cond Type PR00 Desc Price Acc Seq PR00 Desc Price
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K004 K007 KF00 MWST PI01 PI02 Material Discount Customer Discount Freight Output Tax Inter Company Price K004 K007 KF00 MWST PI01 Material Discount Customer Discount Freight Output Tax Inter Company Price Inter Company Price(%)
Inter Company Price (%) PI02
Maintain Access Sequence (V/07) The access sequence is a search strategy, which the SAP System uses to search for condition records valid for a condition type. Access sequence PR00 K004 K007 KF00 MWST PI01 PI02 Description Price Material Discount Customer Discount Freight Output Tax Inter Company Price Inter Company Price (%)
Maintain Pricing Procedure (V/08) Procedure APDD01 APEX01 APSS01 APIC01 Description Direct Sales Exports Sales Seconds Sale Intercompany Sales
Maintain Pricing procedure determination (OVKK) Pricing Procedure Determination for Company Code APCL
Sales Org Dist Channel
Divisi on
Doc. Pricing Proc
Cust Pricing Proc
Pricing Proc
Condition Type
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SOEX SOCP SOCP SOCP SOCP DE DD DS DD DS CO CO SC PO SC A A A A A 1 1 1 1 1 APEX01 APDD01 APSS01 APDD01 APSS01 PR00 PR00 PR00 PR00 PR00
Pricing Procedure Determination for Company Code APML Sales Org SOME Dist Channel DD Division ME Doc. Cust Pricing Pricing Proc Proc A 1 Pricing Proc APDD01 Condition Type PR00
Customer Pricing Procedure It is one of the elements to determine the pricing procedure. We specify the customer determination procedure in the customer master record for each sales area. Document Pricing Procedure It is also one of the elements to determine the pricing procedure. We specify the document pricing procedure for each sales document type. Sales area: We define sales area in enterprise structure. We maintain Condition Records for pricing elements in VK11. Assign document-pricing procedure to order type Sales Doc Description Types ZOR ZCR ZDR YOR YCR Standard Order Credit Memo Request Debit Memo Request Standard Order Credit Memo Request Doc Price Description Proc A A A A A Standard Standard Standard Standard Standard
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YDR Debit Memo Request A Standard
Assign document-pricing procedure to billing type Billing Doc Types ZF2 ZL2 ZLG ZLR YF2 YL2 YLG YLR Description Invoice Debit Memo Credit Memo List Invoice List Invoice Debit Memo Credit Memo List Invoice List Doc Pricing Proc A A Description Standard Standard -
Define Pricing by Item Category Here we show the relevancy of Pricing by Item Category. Item Category AFN AGN TAN TAS TANN REN Description Inquiry Item Quotation Item Standard Item Third party item Free of charge Item Standard Item (Return) Pricing X X X X X
Cost Determination for Item Category Carry out pricing: Indicates whether the system automatically carries out pricing at the item level Determine cost: Indicates whether, during pricing, the system determines the cost (stock value) of a sales document item. Item Description Carry out Determine Cost
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Category AFN AGN TAN TANN REN TAS Inquiry Item Quotation Item Standard Item Free of charge Item Standard Item (Return) Third party item Pricing X X X X X X X X X X X
In SAP we are implementing special functionality in Pricing. Condition Exclusion Group Condition Supplement Pricing Limit Header, Item and Group Conditions.
FREE GOODS DETERMINATION

In this IMG activity, you assign the pricing procedure to activate free goods determination for the relevant transactions. Free goods determination is restricted to order types with document category C. Assign pricing procedure to the appropriate combination of sales area, customer pricing procedure and document pricing procedure
Sales Org Dist Chl Div Document Pricing procedure Customer Pricing Procedure Procedure
SOEX SOCP SOCP SOME
DE DD DD DD
CO CO PO ME
A A A A
1 1 1 1
ZA0001 ZA0001 ZA0001 ZA0001
Determine Item category for free goods item
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The system contains the new item usage FREE which allows item categories to be determined during free goods determination. This activity is done to assign the item category here so that it can be automatically determined Sales doc. Type ZOR YOR Item cat. Group NORM NORM Item usage FREE FREE Higher level Item Cat. TAN TAN Default Item Category TANN TANN
Create Free Goods Determination condition record This is done so that the system picks up the free goods as required.
Material Determination
In this Process one material is automatically swapped by another using condition technique.
Sales Order with standard material
Delivery with the swapped material
Billing with swapped material
Swapping Material
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Configuration
We maintain Material determination procedure AP0001. The Procedure is assigned with the condition type AP01. Procedure AP0001 Description Material Determination
This Procedure should be assigned to the sales document type, T.Code OV14 Sales document type OR Mat.Det.Procedure AP0001
We should maintain the condition record by using the T.Code VB11 for the standard material and for the swapping material. We should maintain the substitute reason by using the T.Code OVRQ. The substitute reason Contains
Column: - This indicates whether to print the name or the number of the original material on the order confirmation, or the substitution materials name or number. Warning: - If it set, will indicate a warning message that a material determination is about to take place. Strategy: - This is used to promote if the substitution should be automatic or via pop up box for selection. Outcome: - This indicator is used to decide whether or the proposed item should automatically replace the existing material or if it should be displayed as a sub item
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in the sales order. This substitute reason should maintain in the VB11s reason column. The item categories of Material determination Substitute item Outcome-A Strategy A Standard item Sub item Substitute item Item category TAX TAPS TAN Item.cat.group NORM NORM NORM
TAX Determination
In pricing the taxes are calculated automatically. Here tax classifications indicate at what level customer and material is liable for tax. Define Determination rules The rules are defined for tax calculation. The taxes are determined automatically within pricing Define Regional codes The following indicators are defined for tax calculation: Country-specific regional codes (county codes). Country-specific city codes Assign delivering plants for Tax determination We allocate the plants to a country, and if appropriate to a geographical region, a country/state code as well as a city codes. The allocation always depends on the countries in which you are using the SAP System. Define Tax relevancy for master record Customer Taxes Tax Cat MWST MWST Desc Output tax Output tax Tax Class 1 2 Desc Tax Exempt Liable for tax
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Material Taxes Tax Cat MWST MWST MWST Desc Output tax Output tax Output tax Tax Class 0 1 2 Desc Taxable Half-tax Exemption
REVENUE ACCOUNT DETERMINATION

A process to establish the revenue accounts to which prices, discounts, and surcharges are posted. Revenue account determination is carried out using the condition technique for transferring billing values from the SD module to the FI module. The system can post entries in the billing documents automatically to the relevant accounts. To do this, it must first carry out account assignment. It can do this depending on the following elements: Chart of accounts of the company code Sales organization Account assignment group of the customer (from the customer master record, Billing screen, Account group field) Account assignment group of the material (from the material master record, Sales 2 screen, Account assignment group field) Account key (from the pricing procedure)
1DOMESTIC REVENUES 2FOREIGN REVENUES 300000SALES - DOMESTIC SALES 301000SALES - EXPORT SALES 302000SALES - SECOND SALES
DOMESTIC : SOCP
GL A/c AAG C AAG M Actky NO Provision Account
App Cndty
Ch
SOrg
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V V V V V V V V V V KOFI KOFI KOFI KOFI KOFI KOFI KOFI KOFI KOFI KOFI APCL SOCP APCL SOCP APCL SOCP APCL SOCP APCL SOCP APCL SOCP APCL SOCP APCL SOCP APCL SOCP APCL SOCP 1 1 1 1 1 1 1 1 1 1 3 3 3 3 3 3 3 3 3 3 ERL ERL ERS ERF ERU SL0 SL1 SL2 SL3 SL4 300000 302000 441000 314000 442000 165000 166000 167000 168000 164000
EXPORTS : SOEX GL A/c Provision App Cndty Ch SOrg AAG C AAG M Actky NO Account V KOFI APCL SOEX 2 3 ERL 301000 V KOFI APCL SOEX 2 3 ERS 441000 V KOFI APCL SOEX 2 3 ERF 314000 V KOFI APCL SOEX 2 3 ERU 442000 V KOFI APCL SOEX 2 3 SL0 165000 V KOFI APCL SOEX 2 3 SL1 166000 V KOFI APCL SOEX 2 3 SL2 167000 V KOFI APCL SOEX 2 3 SL3 168000 V KOFI APCL SOEX 2 3 SL4 164000 MELANGE :SOME GL A/c Provision App Cndty Ch SOrg AAG C AAG M Actky NO Account V KOFI APML SOME 1 3 ERL 301000 V KOFI APCL SOCP 1 3 ERL 302000 V KOFI APML SOME 1 3 ERS 441000 V KOFI APML SOME 1 3 ERF 314000 V KOFI APML SOME 1 3 ERU 442000 V KOFI APML SOME 1 3 SL0 165000 V KOFI APML SOME 1 3 SL1 166000 V KOFI APML SOME 1 3 SL2 167000 V KOFI APML SOME 1 3 SL3 168000 V KOFI APML SOME 1 3 SL4 164000
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ABC Textiles India Ltd. CREDIT MANAGEMENT

Business Process Credit Management is a process by which the company can minimize the credit risk by defining specific credit limits for customers, and hence by implementing credit management, company can take the financial pulse of a customer or group of customers, identify early warning signs, and enhance the credit-related decision-making. The master data for those customers whose credit you wish to monitor is created in both Sales and Distribution and Financial Accounting. You determine how high a customers credit limit is to be when creating this data. The credit limit of the individual customer can be carried out through Automatic Credit Check To enable the credit management, customers are classified into different categories.
Create Customer Credit Customer Risk category Master ClassificationData
A B C D Business process flowchart:

Credit Check
Low Risk Medium Risk

Create Sales Order
High Risk New Customer

Limit Exceeds Credit Releas e
Within the Limit
Create Outbound Delivery
Reject Sales Order N
Picking / Packing
Post Goods Issue Crete Billing
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Batch Management
In ATIL, all the materials are been maintained with specific Batch Numbers and starting from the Raw Material upto Finished goods material, in every stage these batches are very important. There are various reasons for this: Differences in usage and the monitoring thereof in materials planning in SD and Production. Production or procedural requirements (for example, settlement of material quantities on the basis of different batch specifications). Batch Master Data has to be maintained in VCH1 with condition type as configured In this sales organization, Distribution channel, Division, sales Document type and Search procedure should be mapped and check batch: must be activated In material master data sales: General /Plant view, batch management should be activated Create Condition Table & Access sequence for SD and Assign table to Access Seq.
Flow Chart:
Create Batch Determination Procedure
Create Strategy type for SD
Activate Automatic Batch Determination in SD
Maintain Batch Page 185 of 207in Master Data VCH1
Create Batch Search Procedure and Allocate SD Search procedure /
OUTPUT DETERMINATION Outputs are an important media for communicating with business partners or with your own employees in sales processing. Sales and distribution output can be sent both electronically and by mail. Output control, which is dependent on various criteria, allows output to be processed and sent subject to certain conditions and restrictions. We define the following: Rules of output determination Print parameters When the sending of output is to be initiated
Output Determination Using the Condition Technique We use the condition technique to propose output in SD documents. It consists of following steps: Maintain Condition Tables Maintain Output Types Maintain access sequence Assign output types to partner function Maintain output determination Assign output determination procedure Output Determination for Sales Documents Maintain Output Types
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Output Type AF00 AN00 BA00 KO00 Description Inquiry Quotation Order Confirmation Contracts
Maintain output determination Procedure Description AP0001 Inquiry Output AP0002 Quotation output AP0003 Order output AP0004 Contract output AP0005 Item output MAINTAIN MASTER DATA IN T.CODE VV11 Output determination for outbound deliveries Maintain output types Output types LD00 Description Delivery Note
Maintain output determination procedure Procedure Description AP0006 Delivery Output procedure MAINTAIN MASTER DATA IN T.CODE VV22 Output determination for billing documents Maintain output types Output type RD00 RD04 Description Invoice Invoice Receipt
Maintain output determination procedures Procedure Description AP0007 AP0008 BILLING INTER COMPANY BILLING
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MAINTAIN MASTER DATA IN T.CODE - VV33
TEXT DETERMINATION
In this IMG activity, we define the rules for text determination The search for the respective text is carried out using the access sequence, which is stored for each text type in the procedure. The text determination procedures are allocated so that a procedure applies to the following criteria in each case: Account group customer Sales & distribution document type Item category The following text objects exist: Customer Sales Document Delivery Billing Document CAS Define Text Types Different texts exist for every text object. These are distinguished by their text types. For every text type, we have to make the following definitions: ID (key of the text type) Description (description of the text type) Include ID (not yet used) Display text name Define Access Sequences For Determining Texts We define the access sequence, which the SAP System uses to determine the texts for a text object. An access sequence for the text search in the determination procedure for every text types is specified. We define access sequences for sales and distribution documents, not for customer master records.
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Define and Assign Text Determination Procedures The text types of a text object are grouped together in text determination. Text object Customer master record Sales document header Sales document item Delivery header Delivery item Billing header Billing item CAS Key Account group Sales document type Item category Delivery type Item category Billing type Billing type CAS sales activity type
LOG OF INCOMPLETION ITEMS We define incompletion log, when a sales document or sales activity should be regarded as incomplete and how the system should respond when you create a document. The system can make an entry in the incompletion log for the following data: Group A B C D E F G Description Sales-Header Sales-Item Sales-Schedule line Partner Sales Activity Delivery header Delivery Item
Define Incompleteness procedure Sales header Incomplete procedure 10 11 12 14 15
Description Inquiry or Quotation Sales Order Outline Agreement Credit Memo Debit Memo
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16 17 Sales item Incomplete procedure 20 21 22 23 24 33 35 Sales schedule line Incomplete procedure 30 31 Partner Incomplete procedure 07 Delivery Header Incomplete procedure K0 K2 Delivery Item Incomplete procedure L0 L2 Item Proposal Contract
Description Standard Item Credit/Debit memo Item Sched.Agreement Item Qty Contract Item Free Charge of Item Ret. Pack. Contract Item
Description General Schedule line Sched.Line w/Pur.Req
Description Customer
Description Outbound delivery Inbound delivery
Description Out bound delivery Inbound delivery
Assign incompleteness procedure Here we assign procedures to the different incompleteness objects. Define status groups We use status groups to define the status of incomplete sales and distribution documents. Then assign the status group to the fields in an incompleteness procedure
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TRANSFER OF REQUIREMENT In Sales order, the schedule line represents the customers intended delivery date and quantity to be delivered. This material is tranfered to Material requirement planning (MRP). The MRP is then able to determine if there is enough quantity of stock available for the scheduled delivery date. TOR aims to ensure that the materials ordered are ready for the requested delivery date. The Transfer of requirements is basically dependent upon the following factors: Requirement class Requirements type Check group Schedule line category In ATIL, the TOR is set for collective requierments. This requirement can be created daily or weekly and transferred to MRP. Following steps are carried out for TOR: Plant is assigned to Sales document line item level The scheduleline category must be switched on for TOR. TOR must be switched on at the reqirement class level A checking group must be defined and allocated to the material master record in the sale/plant view.
Availability Check
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For every item of a sales order or delivery, the SAP system checks availability if the appropriate configuration is set in sales order processing and shipping. The availability check procedure depends on several factors. Requirements class Requirements type Checking group Checking rule Schedule line category Strategy group Planning strategy Define Checking Groups Checking Groups 01 Description Individual Requirements
Define Material Block for other users. Checking Group Code Description 01 Individual Requirements Initiator for Material Block Code Description A B C Order Delivery Reservation Material Availabilit y Check 01 01 01
Define Scope of Availability Check Material Description FERT FERT FERT Finished Product Finished Product Finished Product Plant APCM APCM APMM Description Individual Requirements Individual Requirements Individual Requirements
Carry Out Control for Availability Check Av.Ch Description Check. Checking Rule
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Rule 01 Individual Requirements A B Order Delivery
Define Procedure by Requirements Class Req. Description Class 41 Order/Delivery Requirements Avail. Req. Check
Define Procedure for each Schedule line category Sch.line Category CP Description MRP (Material Requirement Plan) Avail. Check Req.
Determine Procedure for delivery item category Del. Item Category DLN Description Avail. Check
Standard Item Delivery
Check Availabilit y
Route determination
Route Determination is a process whereby company can assign a specific route with transportation legs using different shipment types and carriers. Normally, it is automatically proposed for each sales document item in the sales order. Following are the factors on which Route Determination is based:
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Departure Shipping Zone Point
Shipping Conditions from Customer
Transportati on-ion group from material
Shipping Country
Destination Zone
Weight group (Optional)
Define Mode of Transport In ATIL we have following mode of transport: No. 01 02 Mode of Transport Road Sea
Define Shipping Type We define shipping types, which are actual vehicles used to transport the materials. No. 01 02 Shipping Type Truck Ship No. 01 02 Mode of Transport Road Sea
Define Transportation Connection Points We have Transportation connection points where transportation types connect or where a transportation types crossed the border.
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C.Points Hyderabad Mumbai Tirpur Bhilwara Bhiwandi Kolkatta Portugal Italy South Korea Description Hyderabad, South, India Mumbai, West, India Tirpur South, India Bhilwara, North India Bhiwandi, West, India Kolkatta, East, India Portugal Italy South Korea
Define routes We define the routes with its associated route stages and transportation connection points Route 001 002 003 004 005 006 007 008 Description Hyderabad Mumbai Hyderabad Tirpur Hyderabad Bhiwandi Hyderabad Bhilwara Hyderabad Kolkatta Mumbai Portugal Mumbai Italy Mumbai South Korea
Define Transportation Zone We have defined transportation zones according to country and depending on the business requirement. Transportation zones represent Delivery recipient (ship-to party) regions.
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Country IN IN IN IN IN Transportation Zone 01 02 03 04 05 Description Region South Region North Region West Region East Region Exports
Assign Departure Country / Zone to Shipping Point We assign countries and transportation zones that we have defined earlier for each shipping point Shipping SPDM SPDM SPDM SPBH SPBH SPMU
Description Shipping point Deshmukh Shipping point Deshmukh Shipping point Deshmukh Shipping point Bhongir Shipping point Bhongir Shipping point Mumbai
Ctry IN IN IN IN IN IN
Zone 01 02 03 04 03 05
Desc. Region South Region North Region West Region East Region West Region Exports
Define Transportation groups We specify the transportation groups defined in sales/plant data of the material master record. The transportation group is copied into the delivery item.
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No. 0001 0002 Transportation Group Container Truck
Define Shipping Conditions from Customer We define shipping conditions in the customer master record in the sales data for each sale area. No. 01 02 03 04 Shipping Condition As soon as possible Standard Just in Time Immediately
Shipping point determination can only be carried out by the SAP system if a shipping condition is contained in the sales document.
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BUSINESS SCENARIO 1 Sale from Plant to Export Market

For New Inquires After the creation of an Inquiry and quotation (pre-sales activities), the customer will shows his interest to take delivery of the products from the company. Then quantity Contracts with the new customers from overseas market are created.
A Quantity contract contains target quantity of the products with relevant prices. The release order will be created as per customer requirement and subsequently billing to be done.
Payment terms are decided well in advance and dunning charges are applied in case of failure of payment within the agreed period.
CREATE INQUIRY
CREATE QUOTATION
CREATE QUANTITY CONTRACT
CREATE RELEASE ORDER
CREATE DELIVERY
CREATE BILLING DOCUMENT
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For Existing Contracts A typical contract entered with the existing customer contains targeted quantities with pre-agreed prices. The release order will be created as per customer requirement and subsequently billing to be done. Business Process:
QUANTITY CONTRACT
CREATE RELEASE ORDER
CREATE OUTBOUND DELIVERY
Reporting Requirement List of items with qty. already released against different release orders of a contract. Cumulative invoice status quarterly/half yearly/annually against the contract. Billing status customer wise / Business Area wise. Payment receipt status customer wise/Business Area wise. Payment outstanding status customer wise/Business Area wise.
Quantity Contract Sales doc type QC Item category group NORM Item category KMN
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BUSINESS SCENARIO 2
Sale from Plant to Domestic Market
Business Process In this business scenario, we create a sales order for the domestic customers as per the customers requirement. In here, we carry out a different price other than the price for Export customers. Payment terms are decided well in advance and dunning charges are applied in case of failure of payment within the agreed period.
Flow Chart Existing Customers

CREATE INQUIRY
NewCustomers
CREATE SALES ORDER
CREATE QUOTATION
CREATE SALES ORDER
BUSINESS SCENARIO 3
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Intercompany Transactions
The following intercompany business transactions are possible: Intercompany Sales Processing Intercompany Stock Transfer
Intercompany Sales Processing In this Business process the customer places an order for the material to the company but due to lack of stock, the company passes a purchase order to an other company, which belongs to the same client and delivers the material to the customer, and raises an inter company billing to the Ordered company, then the ordered company raises an invoice to the customer.
CUSTOMER
O R D E R
I N V O I C E
DELIVERY OF MATERIAL
Sales Org. of Company code APCL
PURCHASE ORDER INTER COMPANY INVOICE
Sales Org. of Company code APML
Intercompany Stock Transfer This scenario covers stock transfer of goods from one manufacturing plant to another manufacturing plant belonging to two different company codes. In
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ATIL we have three manufacturing plants, two at Deshmukh and one at Bhongir, which are engaged into this activity.
Plants at Deshmukh
Plant at Bhongir
BUSINESS SCENARIO 4
Third Party Sales Process
INTER COMPANY INVOICE
PLANT OF COMPANY CODE (APCL)
PURCHASE ORDER
PLANT OF COMPANY CODE (APML)
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In the third party order processing the Company gets the orders from the customer and the purchase order passes to the third party vendor who delivers the goods to the customer and bills the Company. After verification, Company raises the bill to its customers for the material supplied by the third party.
CUSTOMER
O R D E R
I N V O I C E
DELIVERY OF MATERIAL
Sales Org. of Company (APSIL)
PURCHASE ORDER
VENDOR
INVOICE
Invoice Verification
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BUSINESS SCENARIO 5
Returns processing
Return of Goods from Customer to Plant
If the customer returns damaged goods, over-shipments, wrong product or goods that were delivered for sale on approval, you can enter a return in the system. The return causes the system to create a: Returns delivery to register that the goods have been received, and post the goods to stock, for example, blocked stock Credit memo is created when the goods are checked and the Complaint is approved.
CREATE RETURN SALES ORDER (w.r.t INVOICE)
CREATE RETURN DELIVERY
CREATE CREDIT FOR RETURNS
CREDIT MEMO
SALES INFORMATION SYSTEM

Reports can be generated in SD module from Sales Information System (SIS), which have a standardized interface and similar basic functionality. SIS
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is based on information structures. These statistics tables contain transactional data from the different applications. This data is constantly collected and updated by the System. Sales Information System is one of the components of Logistics Information System REPORTS TO BE REQUIRED FOR ABC TEXTILESIndia Ltd. List of items with qty. already released against quantity contract. Cumulative invoice status quarterly/half yearly/annually against the contract. Billing status - customer wise. Payment receives status customer wise Payment outstanding status customer wise/Business Area wise. List of Invoice with R.O. (Statements of Items and quantity released against up-to date Release Order) of the contract. Report for the status of all Documents (Sales Orders, Deliveries, Invoices) Customized report
GAPS
Step Gap1 Gap2
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Business Requirement Brief Description Sales area Specific Billing An Enhancement is needed to generate Sales area Specific Billing Documents. Table Number Range Object Enhancement Need to print Gate pass, Lorry Receipt, Delivery Chelan, copy for self of all the products going out of premises After PGI of Delivery document the above documents can be printed Create a separate program that will select & display such delivery documents This functionality can be integrated with SAP standard Table Number Range Object Enhancement Report / Dialog Program
ABAP Objects needed
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ABC Textile India LTD

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ABC Textiles India Ltd.

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ABC Textiles India Ltd.

ABC Textiles India Ltd.

ABC Textiles India Ltd.

ABC Textiles India Ltd.

3.Bank Accounting Bankers: ATIL is banking with SBI, AB and ICICI.

In SAP, a House bank can be maintained

ABC Textiles India Ltd.

In SAP Cash Journals can be maintained for cashbooks. T.Code:

ABC Textiles India Ltd.

In SAP, Remittance challans can be created in T.Code: J1INCHLN

ABC Textiles India Ltd.

ABC Textiles India Ltd.

ABC Textiles India Ltd.

ABC Textiles India Ltd.

ABC Textiles India Ltd.

ABC Textiles India Ltd.

ABC Textiles India Ltd.

Document type Number intervals

Transaction Code:OBA7 Transaction Code: FBN1

ABC Textiles India Ltd.

COA APML APML APML APML APML APML APML

ABC Textiles India Ltd.

ABC Textiles India Ltd.

ABC Textiles India Ltd.

Standard Interest Calculation Types available P: Item Interest S: Balance Interest

ABC Textiles India Ltd.

Business Area Sales Organization Distributon Channele Division Dunning Notices

ABC Textiles India Ltd.

ABC Textiles India Ltd.

ABC Textiles India Ltd.

ABC Textiles India Ltd.

100 110 110

200 210 210

Transaction Code: OBQ3

ABC Textiles India Ltd.

Tax Type V V V V A A A A Transaction Code: FTXP

ABC Textiles India Ltd.

ABC Textiles India Ltd.

ABC Textiles India Ltd.

ABC Textiles India Ltd.

Transaction Code: OBYR

ABC Textiles India Ltd.

COMPANY CODE APCL

COMPANY CODE APML

ABC Textiles India Ltd.

ABC Textiles India Ltd.

Standard Report S_ALR_87012284 S_ALR_87012271

Internal Reports Report Standard Report

ABC Textiles India Ltd.

ABC Textiles India Ltd.

Controlling Area APCL

Controlling Area APML

ABC Textiles India Ltd.

ABC Textiles India Ltd.

ABC Textiles India Ltd.

ABC Textiles India Ltd.

Transaction Code : KS01

ABC Textiles India Ltd.

ABC Textiles India Ltd.

ABC Textiles India Ltd.