Consigned Inventory as Replacement part w/in ARM

[Stan_Byrd]

Context: 

Customer implementing S/4HANA Cloud Essentials (aka multi-tenant edition)

Multiple Returns scenarios, however, they're being guided to leverage Scope ID BKP (aka Accelerated Returns Management or ARM)... see flow below for specific to customer

You'll notice Consigned Inventory as an input for replacement product

moving consigned to repair pool is perceived as valuation at time of consumption from consignment

however, desire by customer is to have product NON-VALUATED upon movement from consigned to Repair Pool (i.e. unrestricted), as well as NO CrMemo for RTV

current process leverages non-valuated plant for Return from Vendor, then into consignment, as well as from consignment into non-valuated plant to deliver to customer

NOT CERTAIN this is GAAP, or IFRS acceptable from a FI perspective

Curious, if other similar requirements are out in the community; and how handled specifically w/in S4HC Essentials.  Thanks for feedback

[Daniel_Kesenhei · Accepted solution]

Dear Stan,

as per the definition of consignment: It get's valuated as soon as it is moved out of the Consignment stock. You could check the functionality of stock determination. Thereby the system would determine the consignment stock during goods issue. So the stock would get valuated (and moved out of consignment stock) with goods issue of the replacement delivery. As the stock and consumption bookings are happening with goods issue, the stock is not in the balance sheet.

Per my understanding this should fulfill the requirement, or do I miss something?

For you second issue, please check this with the FI Team and auditors, how this process looks like from legal perspective. In which cases is a valuation required? Currently I am not aware of a logistics-process to achieve this.

As this issue is most relevant during months/quarter end, I would suggest, to check with FI Team, if they have certain tools to adjust the valuation during months end for the return to supplier stocks.

Best regards,

Daniel

[former_member1031174]

Hello Stan,

I am on presently on a project where we are facing the same problematic.

Since then, I would like to know how you overcame or worked around this blocking point.

Best Regards.

[Stan_Byrd]

Francois,

Please forgive the delayed reply; as holidays consumed much of the balance of last year, then catching up afterwards. Please view the following for assistance in understanding non-valuated inventory throughout the ARM process...

https://help.sap.com/docs/SAP_S4HANA_CLOUD/a376cd9ea00d476b96f18dea1247e6a5/ec5057f7b5d04f9f95231713...

Best Wishes

[Daniel_Kesenhei]

Dear Stan,

i am not quite sure whether I got your question correctly.

As I understand from your description, you are referring to the Replacement Delivery Part in the process ARM.

Your customer would like to pick and PGI the product for the replacement delivery out of Supplier consignment stock.

Would be great if you can elaborate further, what exactly your questions/issue is.

Usually supplier consignment is not valuated until it is moved out of there. This can either happen with a sperate movement or together with certain movements (e.g. posting goods issue).

Best regards,

Daniel

[Stan_Byrd]

Daniel,

You are correct in that while in consignment, the material is non-valuated; but in fact becomes valuated once "moved out of there." The request of the client is to have as non-valuated; even when moved out of consignment, and while shipping to customer. They also wish for non-valuated upon receipt of defective part: easily accommodated upon GR as well. However, when moving from a non-valuated blocked stock to return to supplier... SAP once again does a JE, and yet, the client wishes for this to be non-valuated.