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Former Member

Change of Material Valuation Class - What Approach to Consider?

Dear SAP Expert ...

In OSS notes # 160970, it mentions that starting from release 4.6B we

can use Customizing Transaction OMT4 (Change System Message) to change

corresponding check from error to warning. With this function, the

system won't check if there are existing document (e.g. = PO, SO,

etc.) for respective materials (which we want to change the valuation

class from), thus we only deals with stock on-hand.

However, the same notes also recommend the customer need to ensure that from

organizational point of view there are no inconsistency occured after the change of valuation class.

We're doing investigation of the automatic account determination which

is driven by some valuation class and ensure that it won't introduce

any inconsistency in Financial Statement (Balance Sheet and Income

Statement).

Basically there are 2 (two) aspects we need to adjust:

(1) Make sure there are no stock available for respective materials during the change

(2) Adjust the error to warning message for system message using OMT4, thus the system won't check any existing document (so we don't have to delete thousands of existing document)

We'd like to clarify with you (if similar experience available before) if the following approach we take has been according to the standard practise and NO

inconsistency will ever occur in the future.

The approach we take is as follows:

(1) Identify the FROM valuation class and TO valuation class

(2) Identify automatic account determination from each FROM an TO

valuation class (IMG path = OMWB)

(3) Determine the G/L account used when the changes happen, e.g. :

➖ Consignment Expense/Revenu (AKO)

➖ Expense/Revenue from Stock Transfer (AUM)

➖ Change in Inventory Account (BSV)

➖ Materials Management Small Difference (DIF)

➖ External Activities (FRL)

➖ Incidental Cost of External Activities (FRN)

➖ Purchase Offsetting Account (FKG)

➖ Purchasing Freight Account (FRE)

➖ Materials Management Exchange Rate Diff (KDM)

➖ MM exchange rate rounding differences (KDR)

➖ Gain/Loss from Revaluation (UMB)

(4) Determine the implication of (different) G/L account posting to the Balance

Sheet & Income Statement reporting

We'd like to say huge thanks in advance for any input or advise.

Regards,

Alvon Sibarani

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  • author's profile photo Former Member
    Former Member
    Posted on Nov 23, 2007 at 01:46 AM

    Hi,

    We have SAP globally implemented in our project. We have similar situation of ability to change valuation class of materials...especially when we do conversions of those materials which are currently used in CIMPRO and other such legacy systems to bring into SAP. For quite long our project teams used to have a practice of writing off materials stocks, POs, contracts, preqs, planned and production orders, sales order etc.....so much messy stuff used be in practice. However, recently (almost a year ago), i have introduced a simple configuration step using which without any change in the material master valuation class, we could achieve the desired results. Basically, for those plants when we bring up into SAP (those already exists as plants in SAP but for legacy plants...just representation only in SAP) I created a different valuation grouping code. So, using valuation grouping code, simply different G/Ls could be mapped as we wanted. So, for the past one year, atleast 15 different plants have gone live with no effort / requirement of changing valuation classes for any of those materials. I am not sure, if your requirement is similar or you just want to change valuation class of materials at any cose for whatever the reason.....Thought of giving you the info if helps!

    Regards

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    • Former Member

      Gopala ...

      That's an interesting approach you provided below. Really appreciate for the input.

      Just for your background:

      1. Our company is also using global instance system (located in US), where all business unit around the globe connects to.

      2. With global instance, we have to standardize majority of the system setting & configuration into a common design.

      3. The common design includes the valuation grouping code, which we use single code (e.g. = ABCD)

      4. I supposed the single valuation grouping code is introduced for ease in corporate reporting tree.

      5. The issues we experience on the valuation class is basically happen for only 1 business unit (in China)

      6. Adjusting the valuation grouping code might solve the 1 business unit issue, while on the other hand we must also consult with the global finance group on the implication to the corporate reporting tree with introduction of the new valuation grouping code (e.g. = WZYX)

      Again that's a valueable input we have here and we'd like to discuss it first with the finance group on the implication. I personnaly doubt the global finance will agree with such approach, not to mention it approaching the year end thus no "major" modification be introduce.

      Regards,

      Alvon Sibarani

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