SAP FI FAQ's on Procurement Cycle and Sales Cycle and Documents


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This document relates to SAP Financials FAQ's on Procurement Cycle and Sales Cycle and Documents © 2010-2012 ALL RIGHTS RESERVED SAPTAC BANGALORE.

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SAP FI FAQ's on Procurement Cycle and Sales Cycle and Documents

  1. 1. SAP FINANCIALS – FAQ’sPROCUREMENT CYCLE, SALES CYCLE AND DOCUMENTSPrepared By: Ms.Pramila Nagaraj First Class MBA Finance Graduate (2009-10) Global Academy of Technology, Bangalore (VTU- Belgaum) Trained up in SAP FICO @ SAPTAC Bangalore (FRESHER) © 2010-2012 ALL RIGHTS RESERVED SAPTAC BANGALORE
  2. 2. SAP FI FAQs – Procurement Cycle and Documents1. Name the five major activities (in the order they occur) in the Procurement Cycle.• Purchase Requisition (MM)• Purchase Order (MM)• Goods Receipt (MM)• Invoice Verification (MM)• Vendor Payment (FI)2. What is a Purchase Requisition?A Purchase Requisition is a document that identifies an organization’s demand for aproduct or service from an outside vendor. It is an internal document (i.e., it is not visibleto the vendor or any other outside organization).3. What are the two ways a Purchase Requisition can be created?• Automatically as a result of a Materials Requirements Planning (MRP) run.• Manually by a user.4. What is a Purchase Order?A Purchase Order is a legal contract between a buyer and a vendor. It lists the materialsor services to be purchased on specified terms and conditions (quantity, price / pricingconditions, delivery date).5. Name the four steps necessary for creation of a Purchase Order.• Source Determination• Vendor Selection• Purchase Order Processing• Purchase Order Follow-Up6. What are the different types of goods movements?Goods receipts, goods issues, and transfer postings.7. What is Invoice Verification?Invoice verification is the process of matching Vendor Invoices to the Purchase Orderand Goods Receipt documents. For matched vendor invoices, a payable is automaticallycreated in the FI General Ledger.© 2010-2012 ALL RIGHTS RESERVED SAPTAC BANGALORE
  3. 3. 8. How is the Payment Program used to make Vendor Payments?The Payment Program is set to maximize cash discounts when paying open vendoritems. It creates a list of proposed vendor items to be paid and suggests paymentmethods for each proposed payment. The user has the ability to make any changesbefore payments are made.Note: The payment program selection strategy (e.g., maximization of cash discounts) isconfigurable.9. Name the three different types of Materials Management documents.• Order documents• Goods receipt documents• Invoice Receipt documents10. From which modules can the above documents be viewed?• Order documents can be viewed only in Materials Management.• Goods and Invoice Receipt documents can be viewed from both MaterialsManagement and Financial Accounting modules.11. What is a Request for Quotation (RFQ)?A RFQ is a request of quotes from vendors for a particular good or service. An RFQ canbe created with reference to a Purchase Requisition or be created directly.12. How is a Purchase Order created in SAP?A Purchase Order (PO) can be created directly or with reference to a RFQ, a Contract, aPurchase Requisition, or another Purchase Order.13. What is an Outline Agreement?An Outline Agreement documents a long-term arrangement with a vendor to providematerials or services at an agreed price. It is valid for a period of time or until a pre-defined total quantity or total value is reached.14. What are the different types of Outline Agreements?Contracts and Scheduling Agreements© 2010-2012 ALL RIGHTS RESERVED SAPTAC BANGALORE
  4. 4. 15. For what is an Account Assignment Category used?Account Assignment category is used to manually create Order documents. Itdetermines which account assignment data is required for an item in order to allocatecosts.16. What is the purpose of a Goods Receipt document?A Goods Receipt document is created when goods are received at a plant/warehouse.At this time, an accounting document is created to make a General Ledger entry, and amaterials document is created to record changes in physical inventory.17. What is the purpose of an Invoice Receipt document?When invoices are received from a Vendor, an Invoice Receipt document is created in thesystem. This document can be linked to a Purchase Order, a Goods Receipt, a DeliveryNote, or a Vendor. In addition to the materials document, an accounting document iscreated, which updates the relevant Vendor Account (sub-ledger) and General LedgerAccounts.© 2010-2012 ALL RIGHTS RESERVED SAPTAC BANGALORE
  5. 5. SAP FI FAQs – Sales Cycle and Documents1. What are the five steps in the Sales Cycle and what Modules do they originate from?  Sales Order : SD Module  Deliver Note : SD Module  Goods Issue : MM Module  Billing Document : SD Module  Receive Payment: FI Module2. Of the five steps listed above, which ones generate accounting documents and whatare they?  Goods Issue: Debit COGS and Credit Inventory  Billing Document: Debit Accounts Receivable and Credit Sales/Revenue  Payment Receipt: Debit Cash and Credit Accounts Receivable3. What are all the activities in the Sales Cycle?Inquiries, Quotations, Sales Order Processing, Credit Management, Delivery Processing,Goods Issue Processing, Billing Document Processing, Incoming Payment Processing,Automated General Ledger Update4. What is an Inquiry in the Sales Cycle?An Inquiry is a document created in the Sales & Distribution module that represents aquery from a customer or prospective customer.5. What is a Quotation?A Quotation is a document created in the Sales & Distribution module that recordsinformation about materials possibly desired by a customer or prospective customer.The material number, price and alternative items is usually included on a quotation.6. What is a Sales Order?A Sales Order is a contractual agreement between a Sales Organization and a customerconcerning goods to be delivered or services rendered.© 2010-2012 ALL RIGHTS RESERVED SAPTAC BANGALORE
  6. 6. 7. When a Sales Order is processed, the system automatically executes what functions?The system automatically executes:  Credit Checking  Pricing  Material Availability Checking  Transfer requirements to Materials Requirements Planning (MRP)  Shipping Point and Route Determination8. What is a Delivery Note?The Delivery Note is a document created in the Sales & Distribution module that initiatesthe shipping activities associated with delivering materials to a customer9. What financial transaction occurs when the Delivery Note is processed?A Delivery Note does not create a financial transaction in the General Ledger.10. What is the purpose of a Goods Issue?A Goods Issue is a document posted in the Materials Management module that is usedas the source document for recording changes in stock levels associated with deliveringmaterials to customers and for recording the financial impact of such transactions in theGeneral Ledger.11. What is a Billing Document?A Billing Document is a document posted in the Sales & Distribution module, whichsupports the creation of Customer Invoices, Credit or Debit Memos, and the recording ofthe financial impact of these transactions in the General Ledger.12. What accounting transaction occurs when a Billing Document is posted?As a result of a Billing Document, integration to the Financial Accounting module occurswith the automatic creation of an Accounting Document containing the followingaccounting entries:  Debit to the Customer Account and the appropriate General Ledger Reconciliation Account assigned to it.  Credit to the appropriate General Ledger Revenue Account.© 2010-2012 ALL RIGHTS RESERVED SAPTAC BANGALORE