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Former Member

plz requesting kindly for screen shots of intercompany and third party sale

Hi btothers,

Am into new project where we have intercompany sales and third party sales ,can any one plz send me with step by step screen shots to my mail id

Thanks & regards,


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    Former Member
    Aug 16, 2007 at 11:33 AM

    Hello Srinivas,

    Please check your mail.

    Reward points if helpful.

    Thanks in advance.

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    Former Member
    Aug 16, 2007 at 11:54 AM

    hi ,

    plz send me intercompany with example from starting with screen shot

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  • Aug 16, 2007 at 11:45 AM

    Hi gurus,

    Could u mail the above to



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    Former Member
    Aug 16, 2007 at 11:20 AM


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    Former Member
    Aug 16, 2007 at 12:04 PM


    Mail sent , reward if helps

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    Former Member
    Aug 16, 2007 at 02:25 PM

    Hi Srinu,

    Please find below the complete Documentation on Third Party Sales and Intercompany Process.


    In third-party order processing, your company does not deliver the items requested by a customer. Instead, you pass the order along to a third-party vendor who then ships the goods directly to the customer and bills you. A sales order may consist partly or wholly of third-party items. Occasionally, you may need to let a vendor deliver items you would normally deliver yourself.

    Process Flow

    The processing of third-party orders is controlled via material types. Material types define whether a material is produced only internally, can be ordered only from third-party vendors, or whether both are possible. For example, a material that is defined as a trading good can only be ordered from a third-party vendor. However, if you manufacture your own finished products, you may also want, from time to time, to be able to order the same type of product from other vendors.

    Processing Third-Party Orders in Sales

    Third-party items can be created automatically by the system, depending on how your system is set. However, you can also change a standard item to a third-party item during sales processing manually.

    Automatic third-party order processing

    If a material is always delivered from one or more third-party vendors, you can specify in the material master that the material is a third-party item. During subsequent sales order processing, the system automatically determines the appropriate item category for a third-party item: TAS. To specify a material as a third-party item, enter BANS in the Item category group field in the Sales 2 screen of the material master record.

    Manual third-party order processing

    In the case of a material that you normally deliver yourself but occasionally need to order from a third-party vendor, you can overwrite the item category during sales order processing. For a material that you normally deliver yourself, you specify the item category group NORM in the material master.

    If, as an exception, you use a third-party material, change the entry TAN to TAS in the ItCa field when processing the sales document. The item is then processed as third-party item.

    If address data for the ship-to party is changed in the sales order in third-party business transactions, the changed data will automatically be passed on to purchase requisition and also to the purchase order ,if one already exists. In the purchase order, you can display the address data for the ship-to party in the attributes for the item.

    You can only change the address data for the ship-to party in the sales order for third-party business transactions, and not in the purchase order.

    Processing Third-Party Orders in Purchasing

    When you save a sales order that contains one or more third-party items, the system automatically creates a purchase requisition in Purchasing. Each third-party item in a sales order automatically generates a corresponding purchase requisition item. During creation of the requisition, the system automatically determines a vendor for each requisition item. If a sales order item has more than one schedule line, the system creates a purchase requisition item for each schedule line.

    Purchase orders are created from purchase requisitions in the usual way. For more information about creating purchase orders, see the Purchasing documentation. During creation of the purchase order, the system automatically copies the delivery address of your customer from the corresponding sales order. In a sales order, you can enter purchase order texts for each third-party item. When you create the corresponding purchase order, the texts are automatically copied into the purchase order. The number of the purchase order appears in the document flow information of the sales order.

    All changes made in the purchase order are automatically made in the sales order as well. For example, if the vendor confirms quantities and delivery dates different from those you request and enters them in the purchase order, the revised data is automatically copied into the sales order

    You process third-party items by creating a normal sales order. In overview for the order, you can then overwrite the default item category (TAN in the standard system) with the special item category for third-party items: TAS

    Billing Third-Party Orders

    If relevance for billing indicator for the item category has been set to B (relevant for order-related billing on the basis of the order quantity) in Customizing, the system includes the order in the billing due list immediately. If, however, the indicator has been set to F (relevant to order-related billing on the basis of the invoice quantity), the system does not include the order in the billing due list until an invoice from the vendor has been received and processed by the purchasing department. In the standard system, item category TAS (third-party order processing) has been given billing-relevance indicator F.

    In the first case, the third-party order is considered to be completely billed only when the invoiced quantity equals the order quantity of the sales order item. In the second case, each time a vendor invoice is received, a customer invoice is created for the quantity in the vendor invoice and the order is considered to be fully invoiced until the next vendor invoice is received.

    If you have activated billing-relevance indicator F for item categories in Customizing, billing can refer to the goods receipt quantity instead of the incoming invoice quantity.

    You can control whether the invoice receipt quantity or the quantity of goods received is relevant for billing in Customizing for copying control for billing at item level.


    Individual purchase orders are used when your customer orders goods from you that are not in stock and must be ordered from one or more external vendors.

    Process Flow

    During sales order entry, the system automatically creates a purchase requisition item. The purchasing department creates a purchase order based on the requisition and the vendor ships the goods directly to you (unlike third party order processing, where the vendor ships directly to your customer). You then ship the goods to your customer. While the goods are part of your inventory, you manage them as part of the sales order stock. Sales order stock consists of stock that is assigned to specific sales orders and cannot be used for other purposes.

    Process Flow for 3rd Party Sales

    Customize the third party sales in summary:

    Prerequisites for 3rd party sales,

    Purchasing org,

    purchasing group,

    assign the Purchase org to company code

    assign Purchase org to plant,

    should not maintain the stock in material, it should be trading goods,

    1. Create Vendor XK01

    2. Create Material – Material Type as "Trading Goods". Item category group as "BANS".

    3. Assign Item Category TAS to Order type that you are going to use.

    4. A sale order is created and when saved a PR is generated at the background

    5. With reference to SO a PO is created (ME21N). The company raises PO to the vendor.

    6. Vendor delivers the goods and raises bill to company. MM receives the invoice MIRO

    7. Goods receipt MIGO

    8. Goods issue

    9. The item cat TAS or Schedule line cat CS is not relevant for delivery which is evident from the config and, therefore, there is no delivery process attached in the whole process of Third party sales.

    10. Billing *--

    SD - 3rd party sales order Create Sales Order


    Order Type

    Sales org, distr chnl, div


    Sold to

    PO #





    SD - 3rd party sales order View the PR that is created with a third party sales order


    Order Number

    Goto Item Overview

    Item ->Schedule Item

    SD - 3rd party sales order View the PR that is created


    Key in the PR number


    SD - 3rd party sales order Assign the PR to the vendor and create PO


    Key in the PR number

    Toggle the "Assigned Purchase Requisition"


    Check the box next to the material

    Assign Automatically button

    Click on "Assignments" button

    Click on "Process assignment"

    The "Process Assignment Create PO" box , enter

    Drag the PR and drop in the shopping basket


    SD - 3rd party sales order Receive Goods


    PO Number

    DN Number

    Batch tab , click on classification

    Serial Numbers tab

    Date of Production

    Flag Item OK

    Check, just in case



    SD - 3rd party sales order Create Invoice


    Invoice Date

    Look for the PO , state the vendor and the Material

    Check the box

    Click on "Copy"

    Purchase Order Number (bottom half of the screen)


    State the baseline date

    Simulate & Post

    Invoice Number

    *Invoice blocked due to date variance

    SD - 3rd party sales order Create a delivery order


    In the order screen , go to the menu Sales Document , select "Deliver"

    Go to "picking" tab

    State the qty and save

    SD - 3rd party sales order Create a billing document


    Ensure that the delivery document is correct in the


    Go to edit -> Log


    Third party order processing is as follows:

    Assume three companies X, Y and Z

    X - The company,

    y - The customer

    Z - Vendor

    When ever X gets a PO from Y to supply some goods, X has an option of either manufacturing those goods or procuring those goods.

    If he is procuring the goods, there are two methods that are generally followed:

    Method 1) After receiving the PO from Y, X creates a sales order against Y.

    Now at the same time he also creates a PO to a vendor Z to produce the goods

    Z produces the goods and supplies to X

    X receives the goods from Z

    Then X delivers the same goods to Y.

    After that X invoices Y and Z invoices X.

    Note : Here there is no direct/ Indirect relation between Z and Y.

    This process is known as Trading Process. and the Material here is created with Material type HAWA.

    The other method is a Third party order processing method:

    Here the glaring difference is that instead of Z supplying the material to X and X in turn supplying the same material to Y.

    X authorizes Z to supply the material to Y on his behalf and notify him once the delivery is complete.

    Now Z supplies the material to Y and acknowledges the same to X.

    Z will send a copy of delivery acknowledgement and invoice to X.

    After receiving the delivery confirmation and invoice from Z, X has to verify the invoice and this process is known as invoice verification and is done in SAP through Tcode MIRO.

    The next step for X is to create an invoice and submit to Y

    Only after the invoice verification document is posted then only X can create an invoice for Y.

    This is the business flow that is followed for third party order configuration.

    There are few steps that have to be configured to enable the system to function as mentioned above.


    If you are always following a third party process for a material then you have to create the material using item category group BANS.

    The procurement type should be marked as External procurement (F) in MRP 2 view of the material master record.

    if you are not always allowing third party order processing then u can create a material master record with item category group as NORM and the procurement type should be marked as ( X) meaning both types of procurement ( in house manufacturing and external procurement).

    Step 2)

    the item category in the order should be manually changed as TAS.

    For that you need to configure the item category determination

    Order type + item cat Group + Usage + High level = Item cat + Manual item cat

    OR + NORM + + = TAN + TAS

    OR + BANS + + = TAS

    Step 3)

    make sure that during the item category configuration for TAS you need to mark relevant for billing indicator as F

    step 4)

    The schedule line category for this type should be CS.

    make sure that you mark subsequent type as NB - purchase requisition in this schedule line category as this will trigger the purchase requisition order immediately after the creation of the sales order and the PO to vendor is created against this purchase requisition.

    Intercompany Process:

    Go through the explanation given below with test cases.

    Business case: -

    Customer orders goods to company code/Sales organization A (Eg.4211/4211).Sales org 4211 will accept and punch the order in the system with sold to party as end customer code in the system. Company code/sales org B (Eg.4436) will deliver the goods to end customer and raise an intercom any billing on 4211 with reference to delivery. This can happen only after 4211 raises invoice to his end customer to whom the material has been delivered by 4436.

    SPRO Customization required:-

    1. Assign plant of delivering company code (Eg.SI81) to sales org/distribution channel combination of ordering company code (Eg.4211/RT)

    2. Maintain intercom any billing type as IV for sales document type OR

    3. Assign Organizational Units By Plant (Eg.SI81/4211/RT/11)

    4.Define Internal Customer Number By Sales Organization (Eg.4436 will create customer master for 4211 company code and that number will be maintained in this relationship:-4211/231)

    5. Automatic posting to vendor account (Optional)

    6. Maintain pricing procedure determination for 4211/RT/A/1/RVAA01-For customer sales and billing

    Maintain pricing procedure determination for 4436/RT/A/1/ICAA01-For intercompony billing

    Master data to be maintained:-

    1. Create end customer master in company code/sales org 4211/RT/11

    2. Create customer master for 4211 company code/sales org in 4436/RT/11

    3. Maintain PR00 as price for end customer-Active in RVAA01

    4. Maintain PI01 as price which has to be paid to 4436-Statistical in RVAA01

    5. Maintain IV01 as inter-company Price-Active in ICAA01


    1. Create OR with sold to party as end customer.

    2. Plant to be selected is delivering plant belonging to different company code. With this selection system will treat this order as intercomany sales.

    3. Pricing procedure is RVAA01

    4. With reference to this order delivery will be created from the delivering plant and post the goods issue for this delivery.

    5. Ordering sales org will create billing document F2 with reference to delivery for end customer.

    6. Delivering sales org will create intercompany billing IV with reference to delivery document.

    Please Reward If Really Helpful,

    Thanks and Regards,


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