SAP MM module

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Module Objectives
• Upon completing this module, you will be able to:
• Explain the significance of vendor master records.
• Create and maintain vendor master records.
• Name the organizational levels that are important for
the maintenance of vendor master records

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• Various levels of Vendor master data
• Account Group
• Reconciliation Account
• Partner Function
• Creation and maintenance of Vendor master.
• Configuration of vendor master
Agenda

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Master Data and Transactional Data
Master Data:
• Master Data is your business critical data that is stored in disparate systems
spread across your Enterprise.
• Master data generally does not change too often and is used while recording
transactional data.
Transactional Data:
• Transactional Data actually registers a fact or event that happened at a
certain point in time.
• Transactional Data is really what drives the business indicators of the
enterprise and it relies entirely on Master Data

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Master Data and Transactional Data
(Cont..)
• Consider the details about
supplier (name, address,
telephone number, email) which
will not be changing frequently.
Hence, the supplier detail forms a
part of master data.
• The supplier is an entity that is
used in event of placing order
which is a transactional data.

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Master Data and Transactional Data
• Another example, consider the following sentence: “Jack ordered two Sun-
glasses on March twenty third at fifty five dollars each from Walmart.” You will
notice that this sentence expresses a event – i.e. that someone placed an order.
• You can also see that in this sentence, “Jack”, “Sunglasses” and “Walmart” are
key elements without which the order wouldn’t exist or make sense and whose
properties would not change over period of time.
• Master Data Elements: Jack (Customer), Sunglasses (Product), Walmart
(Vendor)

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Vendor Master Data
• The vendor master record contains information on an enterprise's vendors. This
information is stored in individual vendor master records. In addition to the
vendor's name and address, a vendor master record contains data such as the
following:
• Currency used in transactions with the vendor
• Terms of payment
• Names of important contacts (e.g. salespersons)
• Since, for accounting purposes, the vendor is also a creditor of the enterprise, the
vendor master record also contains accounting data such as the reconciliation
account from the general ledger.

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Vendor Master Data (cont.)
• The vendor master record is therefore maintained by both purchasing and
accounting. This is also the reason for the subdivision of the data in the vendor
master record into different categories.

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Vendor Master Data (cont.)
The data in the vendor master record is subdivided into the following
categories:
• General data:
This data is valid for the whole client. It includes the vendor’s address and bank
details, for example.
• Accounting data:
This is maintained at company code level. It comprises data such as the number
of the reconciliation account and the payment methods for automatic payment
transactions.

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Vendor Master Data (cont.)
• Purchasing data:
• This data is maintained for each purchasing organization. It includes the
purchase order currency, Incoterms, and various control data pertaining to
the vendor. You can also maintain different data for specific plants or for
vendor sub ranges .
• You can decide whether vendor master records are to be maintained
centrally (that is, all data is maintained together), or on a decentralized basis
(that is, the relevant departments each maintain their own data).

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Configuration of Vendor Master
• Overview of Settings for the Vendor Master Record : The account group
determines all the key properties for the vendor master record. You can
change the field selection for the maintenance of vendor master records
according to the specific requirements of your enterprise.

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Account Group
• When creating a vendor master record, you must decide which account group
you are going to assign to this vendor.
• The account group has control functions.
• When you maintain the vendor master record, for example, only the screens
and fields that are needed for the relevant role of your business partner
appear and are ready to accept user input. This is controlled by the account
group.

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Account Group (cont.)
Among other things, the account group determines:
• The type of number assignment (internal or external) and the number area from
which the account number that the system uses to identify the vendor is to be
assigned.
• The field selection - which fields are ready for user input, which fields must be
maintained, and which fields are hidden
• Which partner roles are valid (Define all permissible partner roles and club them
together in a partner schema. Then assign this partner schema to account group).
• The status - whether the vendor is a one-time vendor (see below)

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Account Group : Customization
• Account Group Controls following Important functions for a Vendor Master we
defined in Customization.

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Account Group : Customization (Cntd.)
• Menu Path: IMG → Logistics - General → Business Partner → Vendors →
Control → Define Account Groups and Field Selection (Vendor).

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Account Group : Customization (Cntd.)
• Menu Path: IMG → Logistics - General → Business Partner → Vendors → Control →
Define Account Groups and Field Selection (Vendor).

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Number Assignment : Customization
When a vendor master record is being created, a number is assigned which uniquely
identifies the master record. This number is derived from the number range (numeric
or alphanumeric) that is assigned to the account group. There are two options for
assigning the number:
• Internal number assignment:
The system automatically assigns a sequential number from the defined number
range. The last number assigned is logged in the number level.
• External number assignment:
In the external number assignment, when creating the vendor master record, the
user must assign a number from the defined number range. This number must be
within the defined number range.

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Number Assignment : Customization
(Cntd.)
To create a new number range, you perform the following steps:
• Adding a new number range interval The individual number range intervals must
not overlap, which means that each vendor number can only occur once. If a
number range is to be used for the external number assignment, the appropriate
indicator must be set.
• Assignment to an account group In a second step, you assign the account group
to the new number range.

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Number Assignment : Customization
(Cntd.)

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Field Selection Group : Customization
Influencing Factors for Field Selection:
• You use the field status to specify:
• In which fields data must be entered (mandatory)
• In which fields data can be entered (optional)
• Which fields should not be displayed (hide)
• Which fields should only be displayed, but should not be ready for input (display)

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Field Selection Group : Customization
(Cntd.)
• Menu Path: IMG → Logistics - General → Business Partner → Vendors →
Control → Define Account Groups and Field Selection (Vendor).
• The following excerpt from the SAP system Customizing shows the settings for
field selection for vendor master records: General Data for the account Group
0001

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Field Selection Group : Customization
(Cntd.)

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Reconciliation Account
• Each and every sub-ledger (vendor) account should have a corresponding
reconciliation account in the general ledger.
• SAP automatically posts an entry in the reconciliation account as and when an
entry is made in sub-ledger.
• To take a simple example the G/L account "payable account for goods and
services" is an example of a reconciliation account for suppliers.

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Partner Roles
• The business partner “vendor” can assume various roles in dealings with your
enterprise. For example, during a procurement transaction, the vendor is first the
order recipient, then the supplier of goods, and finally the invoicing party (invoice
presenter).

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Partner Roles
• The maintenance of partner roles in the vendor master record enables you to
distribute one or more of these roles among different vendor master records.
Using the partner role functionality, you can define a different creditor as a freight
forwarder for a certain vendor, for example.
• Example: You have Vendor ABC who has a branch in Bangalore and having
headquarters in Mumbai. So, if your organization situated in Bangalore wants to
place an order, it places with Bangalore branch of vendor ABC which it then
forwards to Mumbai to deliver the goods.
• In this case, we have 2 roles – one is the vendor (VN – performed by Mumbai
Head Quarter) and another the Ordering Address (OA – Order being placed at
Bangalore). So, the ordering address has to be created as a separate vendor (say
ABC-Bangalore branch) and assigned to Vendor ABC.

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Partner Roles : Customization
The following partner roles are predefined in the standard SAP system:
• Vendor (VN)
• Ordering address (OA)
• Goods supplier (GS)
• Invoicing party (IP)
• Different payee (AZ)
• Contact person (CP)

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Partner Roles : Customization (Cntd.)
• IMG→ Materials Management → Purchasing → Partner Determination → Partner
Roles → Define Partner Roles.

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Partner Roles : Customization (Cntd.)
• IMG→ Materials Management → Purchasing → Partner Determination → Partner
Roles → Define Permissible Partner Roles for account group.

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Partner Schema : Customization (Cntd.)
• IMG→ Materials Management → Purchasing → Partner Determination → Partner
Settings in Vendor Master Record→ Define Partner Schema.

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Partner Schema : Customization (Cntd.)
• IMG→ Materials Management → Purchasing → Partner Determination → Partner
Settings in Vendor Master Record→ Assign Partner Schema to Account groups.

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Discussion
• Discuss about different Organization
Levels of Vendor Master.
• Discuss about the significance of Account
Group.
• Discuss about functionality of Partner
Functions.
• Discuss about Reconciliation account and
uses.

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• List down different Levels of Vendor Master?
• Is it possible to create Both Internal and external number ranges for
Same Vendor account Group?
• How to block a Vendor ?
Checkpoint

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You should now be able to:
• Explain the significance of vendor master records
• Create and maintain vendor master records
• Name the organizational levels that are important for the maintenance of
vendor master records.
Module X Summary

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Questions and Comments
• What questions or comments
do you have?

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Exercise
Exercise 2: Creation of vendor master record at various
organization levels – (30 min.)
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