contents: introduction to the procurement process purchasing items purchasing service...
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Contents: Introduction to the Procurement Process
Purchasing Items
Purchasing Service
Troubleshooting Issues in Purchasing
Purchasing - A/P
In this unit, you will: Master the basic steps of the procurement process for purchasing items
or services
Understand the consequences of each step on inventory and accounting
Handle issues that arise with a vendor’s delivery and billing
Purchasing - A/P: Purpose
You purchase your warehouse goods from external vendors. Normally, you use the purchase order document to order goods. In some cases, however, you submit your order by phone and your vendor delivers the items immediately. In this case, the process modeled in the system must be as short and quick as possible.
If the delivered goods do not meet your quality standards, you want to return them to your vendor. This can happen either before or after you have received the invoice.
You purchase services such as web design and landscaping from vendors using purchase orders. Other services such as electricity or rent are purchased without purchase orders.
Purchasing - A/P: Business Example
Purchasing Items: Unit Overview Diagram
Topic 3: Troubleshooting Issues in Purchasing
Purchasing - A/P
Topic 1: Purchasing Items
Topic 2: Purchasing Services
Purchasing Items: Process Overview
Purchase Order Goods Receipt PO
A/P Invoice Outgoing Payment
System Configuration
Purchasing
Warehouse management
Production
Inbound logistics
Outbound logistics
Marketing &
SalesService
Financial controlling
Master data
Purchase Order
10 printers are currently in stock We order 5 more from our vendor Five appear on the inventory reports as ordered 15 will be available to promise, Although only 10 are physically in stock
Key Master Data in Purchasing: Vendor
All purchasing transactions
One or more control accounts for vendors
Possibletransactions
Vendors
Addresses in the Purchase Order
Vendor
Ship to Address
Pay to Address
Purchase Order
Logistics Tab
Company / Warehouse
Key Master Data in Purchasing: Items
Item master fields useful In purchasing Preferred Vendor
Manufacturer Catalog Number
Purchasing Unit of Measure
Customs group for imported items
Tax information
Drafts of Sales or Purchasing Documents
Vendor / Customer
DocumentDocument
Item Descr. Quantity Price
Y1000
A03 Printer 20 249,90 B10 Cartridge 40 4,50
Vendor / Customer
Document - DraftsDocument - Drafts
Item Descr. Quantity Price
Y1000
A03 Printer 20 249,90 B10 Cartridge 40 4,50
Vendor / Customer
DocumentDocument
Item Descr. Quantity Price
Y1000
A03 Printer 20 249,90 B10 Cartridge 40 4,50
Save as
DraftAdd
Documents Output
Vendor / Customer
DocumentDocument
Y1000
A03 Printer 20 249,90
B10 Cartridge 40 4,50
Print Preview Printout
Y1000
A03 20pcs 49,90B10 40pcs 4,50
Total 1178...
Y1000
A03 20pcs 49,90B10 40pcs 4,50
Total 1178...
File Preview File Print File Export
Y1000
A03 20pcs 49,90B10 40pcs 4,50
Total 1178...
File (PDF, Text, XML, MS Word, MS Excel, or Image)
File Send E-mail File Send Fax
Goods Receipt PO
10 printers are currently in stock We ordered 5 more from our vendor The vendor delivers 5 After goods receipt, 15 are in stock
Two options to create a follow-up document: Copy to/ Copy from
Copy to Copy from
Open saved document to copy All items copied to new
document No options available on how
items are copied However, you can delete items
and adjust quantities after copying
Enter business partner in a new document
Choose one or multiple documents from a list
Draw document wizard allows you to: customize rows and quantities
copied select the exchange rate to use
Effects of the Goods Receipt PO
1
4
23
A/P Invoice
You receive an invoice from the vendor for the 5 printers You enter an A/P invoice to reflect the vendor invoice The A/P invoice is the basis for payment to the vendor
Effects of the A/P Invoice
34
Quantity increases only if no prior goods receipt is referenced.
21
Postings in Purchasing Process for Inventory Items
Purchased Item
Fixed Assets
Inventory Item
Sales Item
Allocation Acc.Stock Acc.
100 100Vendor
100100
AllocationAcc.
Item Category:
Document Flow in Purchasing
General Ledger(Value)
Warehouse(Quantity)
1 2 3
Payment Processing
We owe the vendor for 5 printers An A/P invoice has been entered for the amount owed You create an Outgoing Payment according to payment terms The journal entry:
Reduces cash (credit) Decreases the amount owed to the vendor
Purchasing Reports
Purchase Analysis Open Items List Vendor Liabilities Aging Drag & Relate
Model Report: Inventory Status
Stock Changes in Purchasing A/P
In Stock - Committed + Ordered = AvailableTransaction
Purchase order
Goods receipt PO
Goods Receipt PO w/o reference to PO
A/P invoice forgoods receipt PO
A/P invoice with referenceto Purchase Order
Goods returns
A/P Credit memo
Pu
rch
asin
g /
AP
A/P Reserve Invoice w/o reference to PO
Goods Recept PO with reference to A/P Reserve Invoice
+ +
+ -
+ +
+ +
+ +
+ -
-
-
-
-
+ Indicates increase in quantity- Indicates decrease in quantity
-
Purchasing Items: Topic Summary
Key points from the Purchasing Items topic: The four main steps in the procurement process for items are:
Purchase Order
Goods Receipt PO
A/P Invoice
Outgoing Payment
Key master data used in purchasing: vendor and items
Each purchasing document has a different effect on inventory and/or accounting.
Exercises for Purchasing Items
Purchasing Services: Unit Overview Diagram
Topic 3: Troubleshooting Issues in Purchasing
Purchasing - A/P
Topic 1: Purchasing Items
Topic 2: Purchasing Services
Purchasing Services – Process Overview
Purchase Order A/P Invoice Outgoing Payment
Item / Service Type
ServiceService Customer
Description
DocumentDocument
G/L Account Price
C00001C00001
Name SmithSmith
ItemItem Customer
Item No.
DocumentDocument
Description Quantity
C00001C00001
Name SmithSmith
Price
In Purchasing (and sales) you can set your documents as either Item type or Service type.
Create a Service Invoice
Vendor Master Data
Vendor Invoice
Default dataEnter data
A /P Invoice
Vendor number Invoice number Invoice date Description G/L Account Total due
Vendor name Invoice number Invoice date Description Amount due …
Vendor number Vendor name Address Payment terms Payment method …
Check for duplicate invoice numbers
Postings in Purchasing Process for Non-Inventory Items
Purchased Item
Fixed Assets
Inventory Item
Sales Item
Vendor
Expenses AccountEU Expenses Acc.Foreign Expenses Acc.
100100
Item Category:
Exercises for Purchasing Services
Purchasing Services: Topic Summary
Key points from this topic: The main documents used in purchasing services are:
Purchase order
A/P invoice
Outgoing payment
Services can be represented by a description in a service type document or represented as an item in an item type document.
For services such as rent or utilities, typically an A/P invoice is created without a purchase order.
Troubleshooting Issues in Purchasing: Unit Overview Diagram
Topic 3: Troubleshooting Issues in Purchasing
Purchasing - A/P
Topic 1: Purchasing Items
Topic 2: Purchasing Services
Goods Receipt PO
#
1
2 20
3
Goods Receipt PO
Partial Deliveries and Overdeliveries
1) Overdelivery 2) Add Items
Purchase Order
#
1 10
2 15
3 2
Goods Receipt PO
#
1 6
2
3
#
1
2
3
4 1
Goods Receipt PO
#
1 4
2
3
3) 1st Partial Delivery
4) 2nd Partial Delivery
Vendor Y1000Vendor Y1000
Vendor Y1000 Vendor Y1000
Vendor Y1000
General Ledger(Value)
Warehouse(Quantity)
Goods Returns
Stock Acc.100 100
Allocation Acc.
20 scanners were ordered and delivered 2 scanners were damaged in transit Use the goods return to return the scanners
to the vendor for creditStock Acc.
Allocation Acc.
100 100
General Ledger(Value)
Credit Memo for Purchasing
Allocation Costs Acc.Stock Acc.
100 100
VendorAlloc.
100100
Stock Acc. Vendor
100 100
Warehouse(Quantity)
50 CD boxes were ordered, delivered and invoiced
5 boxes were defective Use the credit memo to return items
for credit when an A/P invoice exists
Credit related to specific
invoice
Partial amount credit memo
Reduce total due to vendor
Reduce total due to vendor
Full amount credit memo
Copy from invoice
Closed Invoice
Do not copy from invoice
Credit related to specific,
single invoice
Reverse invoiceamount & reduce
amount due to vendor
Full amount credit memo
Partial amount credit memo
Reduce invoice amount and
amount due to vendor
Open Invoice
General credit related to multiple invoices
Creating a credit memo with or without reference
2500400020608560
2500400020608560
Researching invoice payment status
Vendor Balance 8560
Troubleshooting Issues in Purchasing: Topic Summary
Key points from this topic: A goods receipt PO can handle over deliveries or under deliveries
A goods return is used to return items not yet invoiced.
A credit memo can be created with reference to an open invoice.
If the invoice is paid, the credit memo must be created without reference.
Exercises for Troubleshooting Issues in Purchasing
Purchasing - A/P: Unit Summary
You should now be able to: Purchase items and services in SAP Business One
State the consequences of each process step on inventory and accounting.
Handle issues that arise from a vendor’s delivery or billing errors.
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