MM-FI Integration

SAP mm-fi
INTEGRATION
sTEP BY Step
Notes

Ashraf
Corporate & Online
Trainer

Material Management Concept:

Material Management is one of the important module in SAP. These module supports the Procurement and Inventory
Function occurring in day to day business operations.
This module contains many aspects such as
Purchasing,
Good Receiving,
Material Storage,

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Consumption based Planning and
Inventory

MM Module is tightly integrated with other modules of SAP R/3 like Financial Accounting, Controlling, Sales and
Distribution, Quality Management, Plant Maintenance, Production Planning and Warehouse Management

It supports all phases of Material Mgmt like Material Planning and Control, Purchasing, Good Receiving, Inventory
Mgmt and Invoice verification

MM Organization Structure

Company Code

Plant 1 Plant 2 Plant 3 Plant 4

Storage Location

Purchase Groups

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Purchasing Organization:
It is an MM Org unit, used to categories inventory transactions according to its nature.
Multiple Plants can be assigned to one Purchasing Org.

Plant:
It is a physical location where the Production Activity and Procurement transactions are performed. In SAP Plant can
be Production Unit, Sales Office or a Corporate Office.

Note: All Inventory transactions must be Posted at Plant Level

Automatic Posting of Inventory Valuation Transactions in Fin. Accounting depends on Assignment of Company Code
to Plant
This Assignment can be 1 : 1 or 1 : N ratio (Company Code Vs Plant)

Note: One Plant Cannot be Assigned to Multiple Company Codes

Storage Location:
The Place where the Stock are kept. These Locations are maintained under Plant

Importance Parameters of MM – FI Integration are

Company Code and Plant Assignment
Valuation Level
Moment Type
Material Master
Transaction Keys or Event Keys
Valuation Sting
Valuation Grouping Code or Valuation Modifier
Account Modifier or General Modifier
Valuation Class
Posting Keys

Sub Module of MM
Material Planning
Purchasing
Inventory Mgmt
Vendor Valuation
Invoice Verification
Statutory Requirement

Procurement To Payment ( P To P Cycle )

All Inventory Managed transaction are posted from MM Module and due to Integration settings, the valuation will hit
Financial Accounting in the form of Journal Entries

Purchase Requisition
Purchase Order
Goods Received → Inventory A/c Dr To GR/IR Clearing A/c
Invoice Receipt → GR/IR Clearing A/c Dr To Vendor A/c
Outgoing Payment → Vendor A/c Dr To Cash / Bank A/c

Procurement of Goods or Assets or Services (Procurement Process P 2 P Cycle )

Goods Receipt Accounting Entry Invoice Verification Accounting Entry

Inventory Account Dr GR/IR Clearing A/c Dr
To GR/IR Clearing A/c To Vendor A/c

Vendor Payment Accounting Entry Material consumption against cost centers

production order Accounting Entry
Vendor Account Dr Consumption A/c Dr
To Cash/Bank A/c Inventory A/c
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Finished Goods Received From Production
Dept. Accounting Entry
Inventory Finished Goods A/c Dr
To Change in Stock A/c or
To Increase/Decrease A/c or
To Factory Production Output A/c

Delivering the Finished Goods To Customer

Movement Type
Goods movement in Logistic is tracked through movement type.

This must be provided against each inventory transaction

List of Movement Type

101 - Good Received with Reference to Purchase Order
102 -Reversal of Movement Type 101 (Cancellation of Good Received)
122 -Return Delivery of the Supplier
201 -Goods Issued to Cost Center for Consumption
241 -Goods Issued to the Assets
261 -Goods Issued Against Production Order
309 -Transfer of Posting from Material to Material
311 -Transfer Posting from Storage Location to another Location
545 -Receipt of Product from Sub-Contractor
554 -Scrapping of Goods
561 -Initial Entry of Stock Balances (Opening Stock)
601 -Goods Issued for Delivery
651 -Good Return from Customer
701 -Inventory Differences Unrestricted Stock

Note: Based on Movement Type system will control the transaction keys. Inventory GL Accounts are maintained
against transaction keys
Material Types:
It is used to classify the materials based on material nature and attributes
The Material Master must be created with ref. to material type
Each Material Type Control
No. Range of Material Master (Internal/External)
Field Status of Material Master, Views, and Screens Settings
It Controls Controlling and Accounting information

List of Material Types:

ROH -Raw Material
FERT -Finished Goods
VERP -Packing Material
ERSA -Spare Parts
DIEN -Services
HALB -Semi Finished Goods
PIPE -Pipe Line Products
HAWA -Traded Goods

Note: Against Material Type, we must maintain quantity update and value update (Material Type Attribute) for each
Plant and Valuation Area.
On setting of this indicator system will updates all quantity movements and value of material in a Material Master

Material Master:
It is Important Logistic Master Data and consists of all the imp or Key Properties relevant to other modules.
It is maintained with multiple views relevant to MM, SD, PP, PM, WH, FI and CO
It indicates Material Master is central component used for Integration between all others module
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Plant Or Valuation Area:
Plant is Logistic Org unit which is used to track or maintain all inventory transactions
All the stocks or Material Master must be maintained at Plant Level
Each Plant must be assigned to a Company Code

Valuation Area:
Material can be valuated at Plant Level or at Company Code Level
The Level at which the Materials are valuated into Financial Accounting is called as Valuation Area or Valuation Level

Valuation Level at Company Code:

The Material Price must be equal across all the Plants of a Company Code

Valuation At Plant Level

Material Prices are maintained at Plant Level and Price can be differentiated

It is advisable to maintain material valuation at Plant Level

Price Indicators:
The Price indicators of Material Master Place a vital/imp Role in Material Valuation
Below are Price Indicator available for Valuate inventory

S-Standard Price
V-Moving Average Price

Standard Price:
The nature of material prices which are Fixed or not Fluctuated frequently are managed with Price indicator ‘S’ and
also the in-house manufacturing materials for which the Price is under control also managed with Standard Price

The standard price is maintained in material master. All the material/goods movements must be evaluated with the
standard price maintained in material master
Any price difference will be posted to Price Difference Account
Price Standard
Description Indicator Price Actual Price Quantity Value Difference
Material XYZ X 10 5 50
Material XYZ X 12 5 60 10

The Production Department produced 10 more quantity at 12/- Actual Cost.

The material is valuated at Rs.10/- and difference of Rs.2/- will be posted to Price difference account or Production
Variance Account

List of Transaction Keys:-

Moving Average Price:

This indicator is maintained for materials for the Prices which are much fluctuated and not under the control of
Organization.
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MM-FI Integration
FR1 Freight Cleaning Account
FR2 Freight Provisions Account
GBB Offsetting Entry for Inventory Posting
KON Consignment Payable
PRD Cost (Price) Differences
UMB Gain/Loss From Inventory Revaluation
WRX GR/IR Clearing Account
Ex: - External Procured Materials, Services, Traded goods.
System will always calculate a New Price at each Goods Movement

Material Valuation is done at New Price

Transaction Keys:
The inventory GL A/c are mapped to Transactions Keys with the Combination of Chart of Acc (COA), Valuation
Grouping Code, Valuation Modifier or Account Modifier and Valuation Class

Based on the Valuation Sting of the movement type system will automatically hit the respective transaction keys.

This code is used to maintain same GL Accounts across all the Plants or to differentiate inventory GL Accounts at
Plant Level
COA Plant CoCd Val Grouping Code
1 10 T100 A
1 20 T100 A
1 30 T100 B – Different Chart of Account

The Valuation grouping code maintained with above combination COA, Plant,
CoCd Valuation Grouping Code
Trans Key COA Valuation Group GL Accounts
BSX T100 A 200100
BSX T225 B - Error 200110

The Valuation Grouping Code maintained with above combination COA,

Plant, CoCd, Val Grouping code

Valuation Modifier or Account Modifier:

This Valuation modifier or Account Modifier are used to differentiate Offsetting
inventory GL Account.
These modifiers are used along with Transaction Keys like
GBB – (Offsetting Inventory Account) and PRD – (Price Differences)

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Trans Key Chart of Acc Val Grp code Account Modifier Gl Accounts Remarks
BSX 1 A 200100
GBB 1 A VBR 400000 Consumption
GBB 1 A VAX / VAY 400010 Delivery
GBB 1 A AUA / AUF 300200
GBB 1 A VNG 400020

List of Account Modifier or General Modifier:

SL MODIF DESCRIPTION
1 AUF Production Receipt from Production Order with Account Assignment
2 AUA Production Receipt from Production Order without Account Assignment
3 BSA Initial Stock upload or Opening Stock Balances of Inventory
4 INV Expenses or Incomes form Inventory Differences
5 VAX Goods Deliver to Customer without Account Assignment
6 VAY Goods Deliver to Customer with Account Assignment
7 VBR Inventory Consumption
8 VNG Scrapping

Valuation Class:
It is used to differentiate Inventory GL Accounts based on Material nature
Valuation class is assigned to the material master under Accounting view.

Note: The Valuation Class is maintained with reference to Material Type

Material Master also created with Reference Material Type

While assignment of Valuation Class to the material master, system validates material types of Material Master and
valuation class. If any mismatch will cause error
SL GL Acc No Text
1 Finished Goods 220000
2 Semi Finished Goods 221200
3 Raw Material Inventory 221000
4 Packing Material Inventory 221100
5 Raw Material Consumption 400000
6 Cost of Goods Sold 400010
7 Factory Output Production 300200
Note:
All Inventory and goods movements will be posted by logistic users with Movement Type
The respective transactions keys area associated with movement type
Against transaction keys inventory GL Accounts are maintained with the Combination of COA, Val Grouping Code,
Account Modifier or General Modifier and Valuation Class

Trans Chart Val rp Account Valuation Inventory Account

of Acc Code Modifier GL Account Descript
BSX 1 A - 1000 221000 Raw Material
BSX 1 A - 2000 220000 Finished Goods
BSX 1 A - 3000 221200 Semi Finished Goods
GBB 1 A VBR 1000 400000 Raw Material Consumption
GBB 1 A VBR 3000 400001 SFG consumption
WRX 1 - - - 100900 GR/IR Clearing Acc
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Configuration Steps for MM – FI Integration
Steps Description T-Code Table Name
Define Plant OX10
SPRO > Enterprise structure > Definition > Logistic general >
Define copy, delete check plant
Define Location
SPRO > Enterprise structure > Definition > Logistic general >
Define Location
Define Division OVXB
SPRO > Enterprise structure > Definition > Logistic general
>Define copy, Delete, check division
Maintain Storage Location OX09 VC_T001L
SPRO > Enterprise structure > Definition > materials
management > Maintain storage location
Maintain Purchasing Organization OX08 V_T024E
SPRO > Enterprise structure > Definition > materials
management > Maintain Purchase Organization
Assign Plant To Company Code OX18
SPRO > Enterprise structure > Assignment > logistics General
> Assign plant to company code
Assign Business Area To Plant/valuation Area and Division OMJ7
SPRO > Enterprise structure > Assignment > logistics General
> plant /valuation area–Division
Assign Purchasing Organization To Company Code OX01 V_T024E
SPRO > Enterprise structure > Assignment > Materials
management > Assign purchasing organization to company
code
Assign Purchasing Organization To Plant OX17 W_T024W
SPRO > Enterprise structure > Assignment > Materials
management > Assign Purchase Organization to Plant
Create Purchasing Groups OME4 V_024
SPRO > Materials management > Purchasing > Create
purchasing groups.
Define Material Group OMSF V023
SPRO > Logistic General > Material Master > Settings for Key
Fields > Define Material groups
Maintain Company Code For Material Management OMSY V_001_MARV
SPRO > Logistic General > Material master - Basic settings >
Maintain company code for materials management
Define Attributes Of Material Types OMS2 MTART
SPRO > Logistic General > Material master-Basic settings >
Material type-Define attributes of material types
Set Tolerance Limits For Price Variance For Purchase Order OMEU VV_169G_PS
SPRO > Material management > Purchasing > Purchase Order
> Set Tolerance Limits for Price Variance
Plant parameters 159L V_159L
SPRO > Materials management > Inventories management &
Physical inventory > Plant parameters
Set Tolerance Limits for Goods Receipt OMC0 V_169G
SPRO > Materials management > Inventories Management
and Physical Inventory > Goods Receipt - Set Tolerance Limits
Maintain Default Values For Tax Codes OMR2 V_169V_ST

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Steps Description T-Code Table Name
SPRO > Materials management > Logistics invoice verification
> Incoming invoice> maintain default values for tax codes
Set Tolerance Units for Invoice Verification OMR6 V_169G
SPRO > Materials Management > Logistics Invoice Verification
> Invoice Block > Set Tolerance Limits
Define Automatic Status Change OMRV V_169P_K
SPRO > Materials management > Logistics invoice Verification
> Invoice verification in back ground > Define automatic status
change
Group together valuation areas OMWD V_001K_K
SPRO > Material management > Valuation and account
assignment > Account determination > Account determination
without wizard > Define Valuation Classes
Define valuation classes OMSK V025
SPRO > Material management > Valuation and account
assignment > Account determination > Account determination
without wizard > Define Valuation Classes
Assignment of Accounts for Automatic Postings
(MM to FI Integration ) OBYC T100BSX
SPRO > Material Management > Valuation and Account
Assignment > Account Determination > Account Determination
without wizard > Configure Automatic Postings
Creation of Raw Material Master MM01
Logistics > Materials management > Material master-material-
Create(General) > Immediately
Document Types and No. Ranges OBA7
WE - Goods Receipt (FBN1) - No. Range 50
WA - Goods Issue (FBN1) - No. Range 49
RE - Goods Invoice Receipt (FBN1) - No. Range 51
To Open Material Periods MMP
Logistics > Materials management > Material Master > Other-
Close period
Creation of Vendor Master KX01
Purchase order creation ME21N
Goods receipt MIGO
Logistics > Material management > Inventory management >
Goods movement > Goods receipt - for purchase order > PO
number known
View Accounting Document MIGO
View Relation Document
Environment > Doc Envir > Relationship Browser
To View GL Line Items FBL3N
To View Material Documents MB03
To View Stock Overview MMB3
Sap Menu > Logistic > Inv Management > Environment > Stock
> Stock overview
To View Stock Register MB5B
Logistics > Materials management > Inventory management
>Environment > Stock for posting date
Invoice Verification (Invoice Received) MIRO
Logistics > Materials management > Logistics-Invoice
verification > Document entry-> Enter invoice
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Step 01 - Define Plants T-Code 0X10
Path: SPRO → Enterprise structure → Definition → Logistic general → Define copy, delete check plant → Double
click on Define Plant → New Entries button
Plant T100
Name T100 - Tata Plant - Hyd
Factory calendar 01
Save
Country IN
Enter
Save

Step 02 - Define Location T-Code 0X10

Path: SPRO → Enterprise structure → Definition → Logistic general → Define Location → New Entries button
Plant T100
Name T100 - Tata Plant - Hyd
Factory calendar 01
Save
Country IN
Enter
Save

Step 03 - Define Division: T Code OVXB TSPA

Path :SPRO → Enterprise structure → Definition → Logistic general →Define copy, Delete, check division → Define
Division → New Entries button
Division Name
T1 T100 – Tata Hyd Division
T2 T100 – Tata Bom Division
Save
Note : Division is organizational unit of SD, which is used to track sales or profits from Salable Materials or services

Division are used to identity or track business area against logistic transactions

Step 04 - Maintain Storage Location T Code OX09 – T001L

Path :SPRO → Enterprise structure → Definition → Materials Management → Maintain Storage Location
Give the plant T100 Enter
Select New Entries
Sloc Description
T100 Raw Material
T101 Finished Goods
T102 Semi Finished Goods
T103 Packing Material
T104 Other Material
Save

Step 05 - Maintain Purchasing Organization T Code OX08 – T024E

Path :SPRO → Enterprise structure → Definition → Materials Management → Maintain Purchase Organization
→ New Entries button
Purchase organization Description
T100 T100-Hyd Pur Org
T101 T100-Bom Pur Org

Step 06 - Assign Plant To Company Code: T code is OX18

Path :SPRO → Enterprise structure → Assignment → logistics General → Assign plant to company code → New
Entries button
CoCd Plant Name of the Plant Status
T100 T100 T100-Plant Hyd T100-Tata Company
T100 T101 T100-Plant Bom T100-Tata Company
Save

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Step 07 - Assign Business Area To Plant/valuation Area and Division – T Code OMJ7
Path: SPRO → Enterprise Structure → Assignment → Logistics General → Plant /Valuation Area–Division
→ Select plant /valuation area – Division button → New Entries button
Plant Division Name BusA Description
T100 T1 T100-Hyd T101 T100-Hyd Bus Area
T101 T2 T100-Bom T102 T100-Bom Bus Area
Save

Step 08 - Assign Purchasing Organization To Company Code T .Code OX01 – T024E

Path : SPRO → Enterprise Structure → Assignment → Materials Management → Assign Purchasing Organization
To Company Code → Position → Purchase org :T100
Porg Des CoCd Company Name Status
T100 T100-Hyd Pur Org T100 T100-Tata Company
T101 T00-Bom Pur Org T100 T100-Tata Company
Save

Step 09 – Assign Purchasing Organization To Plant: T Code OX17 – T024W

Path : SPRO → Enterprise structure → Assignment → Materials management → Assign Purchase Organization to
Plant → New Entries button
Porg Description Plant Name1 Status
T100 T100-Hyd Pur Org T100
T101 T00-Bom Pur Org T101
Save

Step 10 - Create Purchasing Groups T .Code – OME4

Path : SPRO → Materials management → Purchasing → Create purchasing groups → New Entries
Purchasing group Desc Pur Grp TelNo Fax Tel
T10 T100-Pur-Hyd 123456689
T11 T100-Pur-Bom 654825325
Save

Step 11 - Define Material Groups: ( OMSF)

Path : SPRO-Logistic General → Material Master → Settings for Key Fields → Define Material groups → New Entries
button
Material group Material Group Desc AGrp Desc1 Desc2
T100FG T100-Finished Goods
T100HB T100-Semi Finished Goods
T100RH T100-Raw Material
T100VP T100-Packing Material
T101 Key Boards
T102 Mouses
T103 CPU Cabinet
T104 Monitors
Save

Step 12 - Company Code For Material Management : T Code OMSY

Path :SPRO → Logistic General →Material master - Basic settings → Maintain company code for materials
management → Select Position
Cocd Comp Name Year Per FYr MP FYr LM ABp DBp
T100 T100-Tata 2019 12 2019 11 2018 12 X

Note : This period enter carefully, if you once enter it is not modified
Select check box Allow Back Period Posting
Save
Ignore the warning message press enter
Note: In some cases, if we are unable to do changes for the period, delete the Plant (OX18) assignment and then
you can do above step.
Once done this step, reassign the plant to company code in OX18

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Step 13 - Define Attributes Of Material Types: T-Code OMS2
Path :SPRO → Logistic General → Material master-Basic settings → Material type → Define attributes of material
types → Select position button

This step is use to Activate the Quantity value update in the material master against the accounting view

Select Material Type ROH

Double Click on Folder Quantity/Value Update and Select Qty Upd and Value Update check box → Position
Valuation Area T100
Material Type
Enter

Save
Select  Arrow
Maintain the same settings for below material types
Select Material Type HALB – Semi Finished Good Products
Select Material Type FERT – Finished Products
Select Material Type VERP – Packing Material

Valuation Material Qty Upd Val Update Pipe Mand Pipe Allowd
T100 ROH X X
T100 VERP X X
T100 HALB X X
T100 FERT X X
Save

Select Mtype :VERP

Click on to add Costing View to the Material Ledger
Select Costing (To Activate The View)
Save
Step 14 - Set Tolerance Limits For Price Variance For Purchase Order
T-Code: OMEU (T. Code is not Working)
Path: SPRO → Material management → Purchasing → Purchase Order → Set Tolerance Limits for Price Variance

Select TIKY : PE & SE for company code 1000

Against CoCd 1000 → Select the Tolerance Keys PE & SE
Copy As → and Change CoCd
Press Enter → SE → Cash Discount → CoCd

Cocd Company Name TlKy Description

T100 T100-Tata PE Price Variance: Purchasing
T100 T100-Tata SE Max Cash Disc. Deduction(Purchasing)
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Save
Note: System will cross check the Price Variances and Cash Discounts of Purchase Order to Purchase Requisition
Error Message Generate in case of violation of Tolerances

If you want to fix some Tolerance Limit to PE and SE

Select PE and Click on Detail Button
Cocd Company Name TlKy Description
T100 T100-Tata PE Price Variance: Purchasing

Select
Cocd Company Name TlKy Description
T100 T100-Tata PE Price Variance: Purchasing

Step 15 - Plant parameters: T Code 159L (Tr Not Working)

Path: SPRO → Materials Management → Inventories management & Physical inventory → Plant parameters → New
Entries → Plant : T100 and Select the values as per image down

Save

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Step 16 - Tolerance Limits for Goods Receipt T Code : OMC0
This step is used to check PO Price and Qty with Goods Received Quantities.

Path: SPRO → Materials management → Inventories Management and Physical Inventory → Goods Receipt → Set
Tolerance Limits

Select tolerance key B1, B2, VP for company code 1000

Select copy as button and change to CoCd : T100
CoCd Company Name TlKey Deception
T100 Tata Company B1 Order Price Qty Variance (GR)/E-Msg
T100 Tata Company B2 Order Price Qty Variance (GR)/W-Msg
T100 Tata Company VP Moving Average Price Variance

Note : If you want to see the details inside this table values
Select B1/B2/VP and Click on Details Button – It will give the default values, you can change accordingly

Step 17 - Maintain Default Values For Tax Codes T Code OMR2

Path: SPRO → Materials Management → Logistics Invoice Verification-Incoming Invoice→ Maintain Default Values
For Tax Codes → Select New Entries Button
Company code T100 Tata Company
Tax Code V0 (Exempted Input Tax)
Default Value Unplanned delivery costs
Tax Code V0 (Exempted Input Tax)
Save
Msg Default valued Unplanned Delivery Cost

Step 18 - Set Tolerance Units for Invoice Verification T.Code OMR6 – V_169G
Path: SPRO → Materials Management → Logistics Invoice Verification → Invoice Block → Set Tolerance Limits

Select tolerance key BD, PP, ST & VP for company code 1000
➔ Click on Copy As and Change CoCd to : T100
Cocd Company Name TlKy Description
T100 T100-Tata Company BD Form small differences automatically
T100 T100-Tata Company PP Price variance
T100 T100-Tata Company ST Date variance (value x days)
T100 T100-Tata Company VP Moving average price variance
Save

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Step 19 - Define Automatic Status Change T.Code OMRV
While Posting of Invoice Recd, system validates the status of the invoice in the background as verified as Correct or
Completed. System automatically set the invoice status to complete if purchase order quantity is received and invoice
was generated

Path: SPRO → Materials management → Logistics invoice Verification → Invoice verification in back ground →
Define automatic status change → New Entries
CoCd Company Name Corrections
T100 T100 – Tata Company X
Save

Save

Step 20 - Group Together Valuation Areas: T-Code OMWD

Path SPRO → Material Management → Valuation And Account Assignment → Account Determination → Account
Determination Without Wizard → Group Together Valuation Areas → Position : T100
Val Area CoCd Company Name Chrts/Accts Val.Grpg Code
T100 T100 T100-Tata Company T100 T100
Save

Step 20 - Define Valuation Classes: T-Code OMSK – V025

Valuation class allows us to customize account determination according to a particular material.
It is used for assignment of a material to a group of GL Accounts.
This value class can be classified as
1. Material belongs to same type but accounting in different GL Accounts
2. Material belongs to different type but accounting may in single GL Accounts
This is achieved by assigning different valuation classes in material master records on Accounting 1 tab

Path SPRO → Material Management → Valuation And Account Assignment → Account Determination → Account
Determination Without Wizard → Define Valuation Classes → D.Click on Account Category Reference
→ Select ARef 0001 / 0004 / 0008 / 0009 and Click Copy As Button and Change Accordingly
ARef Description
T100 Reference For Raw Materials
T101 Ref. For Finished Products
T102 Ref. For Semi-Finished Products
T103 Reference For Packaging
T104 Reference For Services
Save

Select  Button

Click on Material Type/Account Category Reference

Click on Position : ROH

Save and Do for Other Materials like Below

Mtype Material Type Desc ARef Description
ROH Raw Material T100 Ref for Raw Material
FERT Finished Product T101 Ref for Finished Product
HALB Semi-Finished Product T102 Ref for Semi Finished Product
VERP Packing Material T103 Ref for Packing Material
Save
Select  Button
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Note: SAP Delivered Standard Valuation Classes Like
Select Valuation Classes as per below details and Click on Copy As Button and Change Accordingly
3000 -Raw Material T100 – Raw Material
7920 -Finished Products T101 – Finished Goods
7900 -Semi Finished Products T102 – Semi Finished Goods
8520 -Packing Material T103 – Packing Material
3040 -Spare Parts T104 – Services
3100 -Trading Goods T105 – Trading Goods
Save
Select and Double Click on Valuation Class Button
→ New Entries
ValClass ARef Description Description
T100 T100 Reference For Raw Materials Reference For Raw Materials
T101 T101 Ref. For Finished Products Ref. For Finished Products
T102 T102 Ref. For Semi Finished Products Ref. For Semi Finished Products
T103 T103 Reference For Packaging Reference For Packaging
T104 T104 Reference For Services Reference For Services
Save

Step 21 – Define MRP Controllers – OMD0

The MRP controller is a person or a group of persons responsible for monitoring material availability. You can use the
number entered here, for example, to select the planning results per MRP controller
Path: SPRO → Production → Material Requirement Planning → Master Data → Define MRP Controllers → New
Entries

Plant Name 1 MRP Cont MRP Controller Name

T100 T100-Hyd Plant MRP T100-MRP Controller

Save

Step 22 – Define Schedule Margin Keys – OPJZ

Path: SPRO → Production → Shop Floor Controls → Operations → Scheduling → Define Scheduling Margin Keys →
→ Select 0001/1000 and Click on Copy As Button and Change Accordingly
Plant Name Key Open Float After Float Before Release Period
T100 T100-Hyd Plant 000
T100 T100-Hyd Plant 001 10 1 2 5
Save

Step 23 - Account Determination : - Configure Automatic Postings

Assignment of Accounts for Automatic Postings (MM to FI Integration ) (T Code is OBYC)
We do configurations relevant to transactions in Inventory Management (for example, goods movements ) and in
Invoice Verification (for example, invoice receipt for automatic postings to G/L accounts in Financial Accounting and
Cost Accounting).

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Path: SPRO → Material Management → Valuation and Account Assignment → Account Determination → Account
Determination without wizard → Configure Automatic Postings - OMWB

Note: System prompts Valuation Area screen, if we go through by path

Click on Cancel Button
Click on Account Assignment Button
Double Click on Transaction Key - BSX - Inventory Posting
Give Chart of Account -T100
Select Valuation Modifier Check Box - X
Select Valuation Class - X
Save

Enter the Following Values as stated below

Valuation Valuation GL Account
Method Class
T100 T100 221000 – Raw Material
T100 T101 220000 – Finished Goods
T100 T102 221200 – Semi Finished Goods
T100 T103 221100 – Packing Material
T100 T104
Save

Note: If you don’t give Valuation Modifier then you will get above error as
Account Determination for entry T100 BSX T100 ____ not possible

Select  Button

Double Click on Transaction Key WRX – GR/IR Clearing Account

Please Don’t Select any of the item
Save Posting Rules
Give Account Assignment as 120000 – GR/IR Clearing Acc

Save
Note : Same GR/IR Clearing Account can be used across all the materials

Invoice Process in 3 Way Match:

While processing of invoices system checks the invoice Quantity and Prices with PO and Good Received Qty
P.Order Quantity Price Total
PO 100 10 1000

1 Goods Received 90 Inv Recd 1000

2 Invoice Received 100 12 1200

In these case also Invoice Blocked for Payment

If the match is successful then invoice can be paid if there is a difference, then invoice is blocked for payment

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Step 24 - Creation of GL masters FS00
GL Acc Acct GL Acc Name BS Recn OB LI Sort Field Tax Open Post
Number Group PL Acc LC D Key Stat Code ITMg Auto
120000 Liab GR/IR Clearing BS LIAB X X 001 G045 * X
400050 Exp Material Scrapping PL X 001 G006
100400 Liab Good Received But BS Liab X X 001 G001 X
Invoice Not Received
221000 Assets Raw Material Inventory BS Asset X X 001 G006 * X X
220000 Assets Finished Goods Invtry BS Asset X X 001 G006 * X X
221200 Assets Semi Finished Inventry BS Asset X X 001 G006 * X X
221100 Assets Packing Material Invent BS Asset X X 001 G006 * X X
221300 Assets Invoiced Received But BS Asset X X 001 G001
Goods Not Received

Step 25 - Document Types and No. Ranges (OBA7)

WE :Goods Receipt (FBN1)

No Range : 50
Interval :
No Year From To
50 2014 500000 50500
WA :Goods Issue
No Range : 49
Interval :
No Year From To
49 2014 490000 40500

RE : Gross Invoice Receipt

No Range : 51
Interval :
No Year From To
51 2014 510000 51500

Step 26 - To Open Material Periods: (T Code MMPV)

Path : Logistics → Materials management → Material Master → Other-Close period

From company code T100

Give the period 12
Fiscal year 2019
Select check and close period radio button
Execute

Note : If you have given the period as 01 in Maintain Company Code for Material Management then you need to
open and close all the 05 periods

T.Code MMPV
From company code T100 T100 T100 T100 T100 T100 T100 T100 T100
Give the period 01 02 03 04 05 06 07 08 09
Fiscal year 2019 2019 2019 2019 2019 2019 2019 2019 2019
Select check and close X X X X X X X X X
period radio button
Execute

From company code T100 T100 T100

Give the period 10 11 12
Fiscal year 2019 2019 2019
Select check and close X X X
period radio button
Execute

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Current Valuation in MM01:

Step 27 - Creation of Raw Material Master T Code MM01

Path: Logistics → Materials Management → Material Master → Material → Create (General) → MM01-Immediately

Material <Automatic Number Assignment >

Industry sector Mechanical Engr (From List)
Material type Raw Material
Select Views Basic Data1,2, Purchasing, General Plant, Data/ Storage1/ Accounting1 / 2,
Costing1 / MRP1 / MRP2 / MRP3
Press Enter OK Button
Select organization levels button
Give the plant T100
Storage location T100
Press Enter
General Basic Data 1
Give the description Monitors 19”
Basic unit of measurement PC
Material Group T100RH
Division T1 (Hyd Paint Division)
Dimension/EANs
Gross Weight
Weight Unit
Net Weight

Select Purchasing Tab

Purchasing group T10
Material Group T100RH (Raw Material)

Select Purchase Order Text

Give Text Purchase of Monitor 19"

Select MRP1 Tab

MRP Type PD ()
MRP Controller MRP
Lot Sixe EX - Lot-for-lot order quantity
Select MRP2 Tab
Proc Type F (External Procurement)
Plant Delivery Time 1 Day
Scheduling Key 000

Select MRP3 Tab

Period Indicator P Fiscal Year Variant : V3
Availability Check KP

Select MRP4 Tab

Selection Method
Individual/Coll 1 – Individual Reqmnt

Select Accounting One Tab

Valuation class T100 - Raw Material
Price control V (Moving Avg Price) Price Unit : 1
Moving price 5000 Standard Price :

Select Accounting Two Tab

Select Costing One Tab

Basic Unit of Measure PC
Select X X With Qty Structure X Material Margin
Profit Center 3000

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Costing Lot Size 1

Select Costing Two Tab

Save

Msg:- Material 60000010 Create

Create More Materials by Same Process
Msg:- Material 60000011 Create

Step 28 – View Material List

Path: Main Menu → Logistics → Material Management → Material Master → Other – MM60 – Material List
Material
Plant T100
Execute

Step 29 - Creation of Vendor Master T.Code XK01

Vendor
CoCd T100
Purchase Org T100
Acct Group T100 Press Enter

Title – Company Name AAA Enterprise

Country In
Region 01
Reconciliation Account 100700 (Domestic Payable)
Click 4 Times Next Screen

Sort Key 001

Click Next Screen

Payment Term 0001

Credit Memo Term 0001
Check Double Invoice – X

Under Purchasing Data

Order Currency – INR Term of Payment – 0001

Control Data
Select Check Box X GR-Based Invoice Verification

Save

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Step 30 - Purchase order creation T.Code ME21N
Path : Logistics → Material management → Purchasing → Purchase Order-Create → ME21N - Vendor/supplying
Plant Known
Vendor 1502
Purchase Group T10
Company Code T100
Standard PO Vendor 1512 Doc. Date 04.03.2020
Item Material Text PO OUn C Del Date Net Curr Per OPU Matl Plant Stor
Qty Price Group Loc
60000010 Monitors 10 PC D 04.03.2020 5,300 INR 1 PC Raw T100 T100
19” Mat
Save

Click on Check – No message issued during check → Save

Step 31 - Goods Receipt Against Purchase Order : T.Code MIGO

Path: Logistics → Material Management → Inventory Management → Goods Movement → Goods Receipt → For
Purchase Order → MIGO_GR - GR for Purchase Order (MIGO) or /N MIGO

Goods Received Purchase Order 4500022396 Plant T100 Execute

The details of Purchase Order Copied to goods receipt transactions based on Copy Control Settings maintained by
MM Consultant

Against Material Linen item Select “OK” button check Box and also click on Detail Data

Select “Where” Tab Movement Type 101 Unrestricted stock type means the material Purchase can be used or
Consumed against transfer Cost Centers, Sales Order Or Production Orders etc.

Click on - Check Button Msg - Document OK Click on Post Button

Once the Document are posted Note the Material Document no

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Step 32 - View Accounting Document – MIGO
From The Above Screen
Click on Display Material Document 5000001340 2020 Click Execute

The System will show the flowing screen

Click on Doc Info – Button Then Click on - FI Document Button

Note : In this view we are unable to see the purchasing document no. In such a case, you need to make changes in
layout scree.
Select Screen Layout and Add Purchasing Document to the left side and Save.
Now the system will display Purchasing Document Ref Number as below

The Profit Center is extracted from Material Master and Business area is extracted from Division and Plant

Step 33 - View Relation Document – FB03

/N FB03
Document Number 50003
Company Code T100
Fiscal Year 2019
Enter
From Menu Environment → Doc Envir → Relationship Browser
Accounting Doc 500000 – Select and Click on Display Button
Material Doc 50003 – Select and Click on Display Button

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Step 34: To View GL Line Items FBL3N
G/L Account 221000
Company Code T100
Select Open Item
Click on Execute

Step 35: To View Material Documents – MB03

Material Doc No 500001340
Mat Doc Year 2020
Press Enter

Step 36: To View Stock Overview MMBE

Sap Menu → Logistic → Material Management → Inventory Management → Environment → Stock → MMBE –
Stock Overview
Material 60000010
Plant T100
Storage Location T100
Execute

Note In Case of Error

Error Msg: No Material Found or Activated
Goto MM02
Select Views Plant and Storage Location
Click Org. Level
Give Plant T100
Storage Location T100 Enter
→ Material → Change → Activate
This will activate the material list

Step 37: To View Stock Ledger MB5B

Path : Logistics → Materials management → Inventory management → Environment → Stock → MB5B – Stock for
Posting Date
Material Number 60000010 To
Company Code T100 To
Plant T100
Storage Location T100

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Step 38: Invoice Received Against Purchase Order (Transaction code is MIRO)
Path: Logistics → Materials Management → Logistics-Invoice Verification → Document Entry → MIRO-Enter Invoice

Transaction Invoice
Diff. Posting
Tab Basic Data
Invoice Date 04.03.2020
Posting Date 04.03.2020
Amount 53,000
Text Invoice Received
Down : Select Tab PO Reference
Item Amount Qty Ord Status Purchase Item PO Text
Status Order
1 53000 10 PC OK 104500022396 10 Monitor 19”
Select Tab: Payment
Payt Term 0001
Payment Method A
House Bank 2000 / Acc-2

Similarly Give Other Details- If Required in Tab – Details / Tax / Contracts / Note etc
→ Click on Document Simulate Button
→ Check and Post
→ Msg : Document no. 5105609472 Created

Note: In Case of Error for Tax Code as we have not given here, we are not getting any error. In future if we use
Tax Code such as V1
→ Goto OB40 : Select VST Transaction
Chart of Accounts T100
Save
Select Accounts
Assign GL Account 400501 as Tax on Purchase/Sales Account
Save

Repeat the Same Process For Invoice Recd for Qty 50

Msg: Document No. 5105609473 Created

Step 39: To View Accounting Document

Menu → Invoice Document → Display → Follow Documents

Note: Here I am getting 2 Debits line item, because I have received items in two times.

Step 40: Updating Initial Balances

Path: Logistics → Materials Management → Inventory Management → Goods Movement → Goods Received →
MB1C – Other
Document Date 04.03.2020 Posting Date 04.03.2020
Material Slip
Defaults for Document Items
Movement Type 561 Special Stock
Plant T100 Reason for Movement

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Storage Location T100
GR/GI Slip
X Indiv.Slip w.Inspect.Text Press Enter

Item Material Qty UnE Sloc Plant

01 50065565 10 EA T100 T100
02 50065576 10 PC T100 T100
03 60000000 10 KG T100 T100
04 60000001 10 PC T100 T100
05 60000000 10 KG T100 T100
06 60000011 10 EA T100 T100
07 60000300 10 EA T100 T100
Save
Msg: Document 4900004120 Posted

Click on Accounting Document Button

Click on From Menu – Document → Print Preview

GR/IR Clearing Account:

This Account is a Temporary or Clearing GL Account used to identify GR & IR transactions against Purchase Order
During GR/IR system will Post Transactions to GR/IR Clearing Account

1. To identify any mismatch of Qty and Prices between GR and Invoice Received
2. To meet Fin. Reporting (Periodically) of Goods Received But Not Yet Invoiced and Invoiced But Not Yet Goods
Received. By Classifying the values of GR & IR – Clearing Account

Step 41 - Testing of GR/IR - Reclassification

During month end to meet Financial Reporting Business must execute GR/IR Reclassification transactions.
Note: For Reclassification, we must use GR/IR Adjustment Account without Disturbing GR/IR Clearing Account

During Reclassification System copies items of GR/IR – Clearing Account to GR/IR Clearing Adj Account and then
Reclassifies.

The Reclassification must be reversed in the following month

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Step 42 - Maintain Automatic Account GR/IR – Classification Account - FBKP
SPRO → Img → FA (N) → AR/AP → Bus Transaction → Posting with Alternative Reconciliation Account → Other
Special G/L Transactions → Define Alternative Reconciliation Account for Customers → Select Automatic Posting
➔ D. Click on Goods/Issue Recd Clearing

D .Click on BNG Invoiced But Not Yet Delivered

Give Chart of Accounts T100
Give the Accounts as per below details
Recon Acc Adjustment Target Acct
120000 120010 221300
Save

GO Back
D .Click on GNB Goods Delivered But Not Yet Invoiced
Give Chart of Accounts T100
Give the Accounts as per below details
Recon Acc Adjustment Target Acct
120000 120010 100400

Testing Of Complete Cycle

Step 01 - Create a New Purchase Order – ME21N

Create One More Purchase Order

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Step 02 - Recording of Goods Received – MIGO

Step 03 – Invoice Received – MIRO4

Step 04 – To View GL Balances – FBL3N

GL Account 120000
Company Code T100
Select Open Items
Execute

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Step 43 - Setup Auto Clearing Account Of Line Items – F.13

As per periodic activity Business Users must execute Auto Clearing Transactions against GL Accounts. Customers
and Vendors to Set Off or Knock Off Debit with Credits, which are matching with Assignment Filed and Open Item
Status set to Clear Status

Path – Accounting → F A → GL → Periodic Processing → Automatic Clearing → F.13 Without Specification of

Clearing Currency
CoCd T100
Fiscal Year 2019
X – Select G/L Accounts GL A/c – 120000
X – GR/IR Accounts Special Process
X – Test Run
Execute
Auto Clearing Status Updated Will Appear
Go Back and Remove X – Test Run
Execute Again
Error Msg – This program run is a Production Run Just Press Enter
Msg Document No 1019 Posted

Step 44 – View Clearing Document – FB03

Document No 1019 Company Code T100 Press Enter

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Note: If we have not received the any invoice, then that line item will be shown under Open Line Items

Step 45 – Analyze or Reclassify GR/IR Account

Path – Accounting → F A → GL → Periodic Processing → Closing → Reclassify → GR/IR Clearing → F.19 – GR/IR
Clearing
GL Account 120000
CoCd T100
X GR/IR Clearing
Execute
Click on Postings Button

It is used to bypass
40 120010 GR/IR – Adjustment Account 265,000
50 100400 Good Recd But Inv Not Recd 265,000

It will appear In Balance Sheet

Liabilities Amount Assets Amount
Goods Recd But Inv Not Recd 26,000 Raw Materials 26,000

Account Assignment Category:

It is used to bypass inventory GL Account with other GL Accounts and Cost objects necessary for an item
Ex. Purchase of Stationary through Purchase Order without material master

Purchase of Material used against Fixed Asset, Production Order Projects etc. on using of Account Assignment
category System Post to the respective GL Accounts and Cost objects instead of hitting to inventory accounts.

Note: When ever you Assign Account Assign Category → It will not hit to BSX inventory

Testing Scenario - Purchase of Stationary through Purchase Order

Step 01 – Create Purchase Order - ME21N
Vendor 1502
Purchase Group T10
Company Code T100
Standard PO Vendor 1512 Doc. Date 04.03.2020
Acct Material Text PO C Del Date Net Curr Per OPU Matl Plant Stor
Asst Qty OUn Price Group Loc
K Stationary 500 EA D 04.03.2020 5 INR 1 PC T100FG T100 T100
CCtr

From Down - Click on Account Assignment Tab

GL Account 421001 - Stationary Business Area T101
CO Area T100
Cost Center 2100 Profit Center 3000
Save
Msg: Standard PO Created under the number 4500022399

Step 02 - Goods Received – MIGO

Good Receipt Purchase 4500022399 Plant T100 FR GR goods 101
Order Receipt
Press Enter

Go Down TO The Page

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Select X - Item OK
Check
Post
Msg Material Document 5000001350 Posted

Select
Display Material Document 5000001350 2020 Click Execute
Click on Doc Info
Click on FI Document
Select Accounting Document

Go Back and Click on Controlling Document

Step 03 – Invoice Received – MIRO

Go Back and Change the Amount to Rs.2600

Select Data Tab Amount 2600
Select Detail Tab Unpl Del. Csts 100
Simulate

Post: Document No.5105609484 Created

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View Document
From Menu → Invoice Document → Display → Follow-On Documents → Select Accounting Document

Note : When invoice is receiving with difference of account, adjust the amount in Unplanned Delivery Cost

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