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Introduction :

In PO release strategy Net order value is the main criteria to decide the release level .If company exists in multiple countries ,we have to use local currency for day to day transaction .If we use multiple currencies based on the country ,it is important to configure release strategy in such a way that it meets all the countries requirement without compromise .we could use only one currency in one characteristic (CEKKO-GNETW) and approval  limit values  vary as per the country requirement .In this regard how to approach this scenario .

Business scenario:

Company A exists in three countries for which we have to configure release strategy

 image

Now we have to configure release strategy in such a way that it should satisfy all the three countrys’ requirement.

Assumptioms:

Each country has country specific purchase organisation ,purchase group and release strategise has been created separately for each countries by activating respective purchase group in the strategies.

Exchange rate:

1 USD = 50 INR          1 USD = 0.8 AUD

Prerequisite:

Characteristics used in PO release strategy are

Document type :CEKKO – BSART

Pur. Organisation: CEKKO – EKORG

Pur.group :CEKKO – EKGRP

Net order value : CEKKO – GNETW

If you want other characteristics as per client’s requirement, you can use.

Approach 1:

Use one characteristic for net order value – FRG_GNETW using the communication structure CEKKO-GNETW  with currency USD and create country wise release strategy(Pur group and pur organization helps to configure country wise strategy) .Maintain values in USD as per the exchange rate conversion

For example:

    image 

Pros:

  • 1. Whenever new company code to be added ,Easy to maintain as only one characteristic for net order value

Cons:

  • 1. If the exchange rate fluctuates continuously there is always level jump for the same approval limit.
  • 2. For eg : if exchange rate changes after some time 1 USD = 40 INR (from 50 INR)

           As per the current configuration for net order value 10,000 INR (200 USD) ,the strategy   I1 should apply .

            But as per the new exchange rate the value 10,000 INR = 250 USD, the strategy is I2 and  vice versa also possible

Conclusion:

            As long as business has no concern on this impact, we can proceed with this approach. If business wants exact strategies to be followed at any reason, follow the second approach.

Approach II:

Create characteristics for each currency and maintain country wise release strategy as above.

FRG__GNETW   – USD

FRG_GNETW1 – INR

 FRG_GNETW 2 – AUD

There should not be any blank value for any characteristic .So each strategy will have all the characteristics with value assigned (CL24N)

For example:

image

Pros:

  • 1. Exact business requirement has attained
  • 2. No need to change limit value in the future due to exchange fluctuation

Cons:

  • 1. Every currency/country will have new characteristic.
  • 2. Maintenance burden whenever a new country added
  • 3. If new country added, all the existing strategies also need to be changed (value (>1) should be maintained for new characteristic otherwise existing setup will not work.

Reference:

http://wiki.sdn.sap.com/wiki/display/ERPSCM/RELEASE+PROCEDURE

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2 Comments

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  1. kalai Anna
    Hi,
    This is very useful to implement real time scenarios .
    But you have not given any idea on how the currency conversion takes place in release ?

    (0) 
    1. Raja Ramasamy Post author
      Hi ,
      Thanks for point out that.

      The header currency is converted to local currency (company code currency) and then the local currency is converted to the characteristic currency.

      (0) 

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