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Upload account assignment( cost centre/project based) based PO stock after consumption to inventory

Apr 12 at 03:55 PM

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Dear All,

I need a best practice solution for below scenario.

As we know project based(Q)/Cost Centre (K) based stock immediately gets consumed after GRN. There will be no stock in unrestricted quantity for such stocks.

Sometimes project owners doesn't require the material immediately and want to put it in warehouse. Stores do 501 movement to upload the stock directly in storage location which is not a best practice as per the audit recommendation.

1. we suggested that in such case such kind of material to be received as without account assignment directly to stores and then issue to the respective cost centers/project WBS when they need it in future. Stores are in disagreement to this process as it will increase their minimum inventory value maintenance KPI's.

Please suggest what is the best practice we can follow to do a GRN so that stock value is not booked against stores and also they can keep it on behalf of project/cost centre and issue it when they require it.

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7 Answers

Anisur Rahman Apr 12 at 06:30 PM
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What is the alternative to handle such scenario for cost centre based items without 501

What is the ideal process being followed for recieving cost center based items if after grn it has to given back to stores for warehousing

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Jürgen L
Apr 12 at 04:07 PM
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I think you have to sort this out yourself in your company by bringing the 2 parties together.

Your inventory manager already said that inventory would causing him KPI troubles.

What does it mean? you either have to adjust the KPI or the inventory manager or need to order differently and later and ask your vendor to keep it in his premises until you need it.

As we do not know how the KPI is defined we can't really give you arguments to convince your inventory manager to keep inventory for those parts. And using Excel to track inventory which is not in SAP is probably the most stupid idea, as the inventory still occupies space in the warehouse then and is even less to manage from SAP and will cause problems in planning too.

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Anisur Rahman Apr 12 at 06:06 PM
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Thanks for your quick response !

Is it possible for a valuated material to be consumed instantly during GRN and also show stock quantity only (no value) in the plant X (plant generally used for PO's with account assignment)

Later on from this plant X it will be moved to Plant Y (however in plant Y(used by stores) the material should show as a stock quantity only. No value of material to be shown in this plant as otherwise again stores will have problem as their inventory value will increase)

Please support

Currently stores are just doing 501 to update quantity of the stock for goods lying outside the warehouse which was actually ordered for cost centre consumption. what are alternatives we can do to achieve the same without using 501(no value is to be shown in stores inventory, they are doing this just for recording purpose of goods)

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Jürgen L
Apr 12 at 06:17 PM
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a valuated material with quantity update only, this is just paradox.

And if your warehouse KPIs are based on value instead of quantity then it is totally wrong from my point of view and I wonder how the warehouse manager could ever accept this, he will probably not meet his KPIs when the market price goes up then.

Creating separate plants because of account assignment is even among the worst what I ever read.

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Jürgen L
Apr 12 at 06:39 PM
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Just following a normal logical logistics process is the best practice process, every bending of normal processes for sake of KPI is a step into the wrong direction, it is better to adjust the KPI to measure normal processes.


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It would be great if you can let me know a step by step scenario for cost centre based po grn

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You are confusing me, your initial question was like asking for a help on a heart surgery and now you need a step by step scenario for a band aid.

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I hope you know that project stock can be valuated and non-valuated, that you can manage inventory for project stock or post the receipt directly as consumption to a project. I did no mention it as there is no "cost-center stock" and hence such way would not be possible .

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I am again explaining the scenario

1.Po 100 qty raised for a cost centre

2. After Grn 100 qty good consumed and charges to cost center

3. The buyer used 50 qty anf want to enter remaining 50 in warehouse.

What best practice says

The 50 qty unused goods cannot be taken back in warehouse and should remain at site

Or

Do a 501 to put those 50 qty unused in warehouse and if we do 501 whether value will also be updated in inventory

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Jürgen L
Apr 12 at 08:10 PM
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You define a material type as valuated or non-valuated in OMS2

And based on that fundamental decision one material master is either valuated or non-valuated, but cannot be both.

If it is valuated then value if flowing with each of your movements.

If you do a 501 for a valuated material then the movement is valuated depending on its price control either with moving average or standard cost and written on to your inventory stock account.

The very same happens for a 202 movement, only that it also reduces the consumption from a cost center wile it is writing on inventory in the warehouse.

Theoretically you could use split valuation, with a valuation type for external purchase and a second valuation type for parked inventory. Where the external purchasing would have the normal moving average valuation while the parked returned quantity would have a 0.01 with standard price. I said theoretically, because split valuation is as well a fundamental decision, and if you have already a material master without, then you cannot just change this to be split valuated. You could only achieve this with a new material master or a hell of work with archiving most recent business cases and thus screwing up the basis for reporting.

Your buyer want put 50 into the warehouse, your inventory manager does not want that because of his KPI. This is almost crying for a decision of the organization level above those two if they can't reach an agreement.

Why did the buyer order 100 if he only needs 50 right now? Is this eventually wrong planning? Where will the goods be physically? Is there space in the warehouse to take such excess quantity? Why is there space for non-valuated goods and no space for valuated goods?


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You are absolutely correct i did 202 however it is debiting from cost center but and crediting the value to inventory but with the Moving price maintained in the material master not at the price of purchase of po.

Can you provide some link for split valuation concept examples so i can create the scenario in QA i think the solution you suggested is the only split valuation as these material Master are new we can do as you suggested. Pls reply

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copy this search term to Google: split valuation site:blogs.sap.com

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Can we maintain 2 different prices for a valuated material in 1 different plants so that when 202 is done the plant on which the inventory stock will increase after reversing the price maintained for that plant in material master should be picked for debiting cost center and crediting inventory stock

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Sorry 2 different prices in 2 different plant

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valuated material in 2 different plants so that when 202 is done the plant on which the inventory stock will increase after reversing the price maintained for that plant in material master should be picked for debiting cost center and crediting inventory stock

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The plant is not picked the plant is entered by a user as always in MIGO. And the user also decides to which valuation type he posts.

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Dear Expert,

i want to do a 202 and ensure that every time cost center value is reversed by the rate of material at which it was bought i.e. rate mentioned in PO (consumption based). No 201 is done in my case, direct GRN 101 is done. No Moving average price should be used( which can vary).

also since i will be doing a reservation of the quantity generated in stock (unrestricted) after 201, i will issue the same in future to same cost center, however the same price at which that batch was bought i.e. rate mentioned in PO (consumption based).

Can we apply batch management here??

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you can use batch management, you can also do split valuation by batch. But now you are leaving totally your original intent which was to return the material and to manage it without value.

Batch specific valuation would also be the only reliable way to return the material at its PO costs.

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Hello expert i tried but since during 101 for consumption based po no price updated in the valuation type lets say x of material, while reversal i entered batch number as well of 101 again only quantity was updated as value for the valuation type x was still zero.

I require po cost to be automatically picked during 202 based on 101 k based batch please help

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the batch only gets a value if you post the receipt to stock and issue it from stock to your cost center, one step more.

Remember that I mentioned split valuation at a time where you still wanted to return it without value.

A further option would be to maintain the value manually in the movement, which means the person who does the movement would first need to lookup the price from the PO and calculate the value and enter it in the detail of the movement (field need to be made available through customizing of field selection). This procedure would be pretty risky and auditors would have there problems with it.

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sorry it should be also since i will be doing a reservation of the quantity generated in stock (unrestricted) after 202,

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Anisur Rahman Apr 13 at 05:34 AM
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Thanks for the response.

If after GRN is done for consumption based PO. Cant we do 202 Goods issue reversal to bring the stock back to inventory if yes then can you provide more clarity. Please do not think about KPI of stores as of now at least this scenario happens only for few cases.

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What about doing a test in your QA system?

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I tried doing it i got error material not defined in warehouse 001

How can i proceed anyways i am extremely thank ful to you guys for replies

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solve this error by searching the community for questions on the same error.

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Maintain your material for warehouse 001 and maintained warehouse 1 and warehouse 2 tab.

Thanks,

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I tried the logic is working 202 is the best solution we can have.

We will reverse the Item for which consumption based stock is not required by project team and take it back in inventory stock.

Thanks a lot for your suggestions.

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