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Author's profile photo Philippe Gauthier

FI/MM – Purchase account management

Hello,

I’m starting my second blog, hopefully you have appreciate the first one Enrich Production Variance.

I would like to present a particular point important when you are implementing Material Ledger, it’s the way of manage purchase account.

Purchase account management is currently used in the following countries:

  • Belgium
  • Colombia
  • Finland
  • France
  • Italy
  • Portugal
  • Spain

The point of customizing is here:

Screen%20copy%20of%20path%20into%20customizing

Screen copy of path into customizing

 

and the detail of the customizing is:

Detail%20of%20the%20input

Detail of the input

 

The question is: what is that ?

In case you are using Material Ledger, there is a principle recommend by SAP that PRD and PRY accounts have to use the same root.

I want to explain which difference we have on the subject:

Case 1 – Valuation option according to stock value =Inventory value (item managed as standard)

  • case of a discrepancy with the invoice

Example: material with standard price:10€ /U,

  •  PO : 50 U, 10€ /U, 
  •  Invoice : 50 U, 20€ /U

Posting%201%20-%20item%20managed%20as%20standard%20/%20case%20of%20a%20discrepancy%20with%20the%20invoice

Case 1 – Inventory value – case of a discrepancy with the invoice

 

  • case of a discrepancy with the order and the invoice

Ie : material managed with standard price at 10€/U

  •  PO : 50 U, 20€ /U, 
  •  Invoice : 50 U, 30€ /U

case%20of%20a%20discrepancy%20with%20the%20order%20and%20the%20invoice

Case 1 – Inventory value – case of a discrepancy with the order and the invoice

Case 2 – Valuation option according to stock value = Purchasing value (item managed as standard)

  • case of a discrepancy with the invoice

Example: material with standard price:10€ /U,

  •  PO : 50 U, 10€ /U, 
  •  Invoice : 50 U, 20€ /U

Case%202%20-%20Purchasing%20value%20-%20case%20of%20a%20discrepancy%20with%20the%20invoice

Case 2 – Purchasing value – case of a discrepancy with the invoice

  • case of a discrepancy with the order and the invoice

Ie : material managed with standard price at 10€/U

  •  PO : 50 U, 20€ /U, 
  •  Invoice : 50 U, 30€ /U

Case%202%20-%20Purchasing%20value%20-%20case%20of%20a%20discrepancy%20with%20the%20order%20and%20the%20invoice

Case 2 – Purchasing value – case of a discrepancy with the order and the invoice

 

Conclusion

Case 1 – The Price Purchase Variance is booked base on key “PRD” on purchasing account

Case 2 – The purchase variance must be accounted for via the “PRD” key on the variation stock account, so as not to distort the balance of variation stock. For country like France and Spain is mandatory

Best practices from SAP around this topic are:

To not impact the purchasing account with ML closing, it’s highly recommended to:

  • Manage purchasing accounts at actual value
  • Manage PPV accounts on variation stock

 

Comments

Through blogs.sap.com, I’m trying to share knowledge on S/4HANA. please give me your comment, I’ll appreciate it.

Please don’t hesitate to follow me or/and to share the article, thanks in advance,

Philippe

 

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      3 Comments
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      Author's profile photo Gonçalo Garcia
      Gonçalo Garcia

      Hi Philippe,

      Thanks for taking the time to share your knowledge with the forum.

      I´d like to pick this on a different angle, do you have any source info (independent on ML or even SAP system) on when/why this purchase account management principle is mandatory? I ask this because I´ve worked on CoCds for those countries and sometimes it´s active and sometimes is not and apart from the IMG help there´s not a big deal of context/info around online.

       

      Thanks again!

      Author's profile photo Philippe Gauthier
      Philippe Gauthier
      Blog Post Author

      hello Gonçalo Garcia

      It's mandatory for some country like I have provided on top of article.

      In this case variation stock has to be booked into P&L, for these countries it's a legal requirement and the legal rule is B&S of Stock as offsetting account only P&L account "Variation Stock".

      I can find some legal texts for France.

      But this implementation has some impacts for inter company reconciliation, because, when you are transferred between French company and UK company for example. How can we reconcile inter company process in P&L because UK company doesn't have the similar posting.

      Philippe

      Philippe

      Author's profile photo Li Zhu
      Li Zhu

      Hello Philippe,

      I don´t see any difference between the T-account postings in the 2 scenarios. Would you please check them again?

      Best Regards,

      Julie