SD

VMS Trading Company

Structure DocumentSales and Distribution

Implementation Partner: Allied VMS

Author: VMS SD Team

12th April, 2013

SAP Implementation Project VMS Trading Company – FI Structure Document

13th April, 2013

Copyrights:

Copyright © 2013 Allied VMS Technologies. All rights reserved.

No part of this publication may be reproduced or transmitted in any form or for any purpose without the express permission of Allied VMS Technologies. The information contained herein may be changed without prior notice. Some software products marketed by Allied VMS and its distributors contain proprietary software components of other software vendors.

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Contents PageI. Handling Procedure 1-7

II. Objective: 1-7

III. Overview of Module: 1-81 Organizational Structure: 1-91.1 Sales Organization: 1-101.3 Distribution Channel: 1-101.4 Divivsion: 1-101.5 Sales Area: 1-101.6 Shipping Point: 1-102 Master Data : 2-11USINESS SPECIFIC DETAILS (Master data) 2-112.1 Definition: 2-112.2 Cutomer Master Data:2-112.3 Customer Master Data Process: 2-112.4 Configartion Data:- 2-12Accounts Group: 2-122.5 Partner Fuction: 2-122.6 Customer Master Data and Process Flow: 2-132.7 Customer Master Data:- 2-132.8 Sap Recommended Process Flow Chart For Customer Creation: 2-142.9 Integration:- 2-15

2-15

Value Addition: 2-153 Customer Material Info Record: 3-163.1 Condition Master Data: 3-163.2 Conditions and Agreements (Pricing): 3-173.3 Process defination: 3-17

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3.4 Configuration Data: 3-173.5 Pricing Data master Maintaince: 3-173.6 Pricing conditions (To-Be): 3-173.7 Sap recomended Process Flow Chart: 3-18Integration : 3-184 Sales Order Processing: 3-194.1 Overview: 3-194.2 Scope of implementation: 3-194.3 Business specific Details (sales order Process): 3-20Definition: 3-204.4 Status Anlaysis: 3-204.5 Automatic Detemination: 3-20Configuration Data: 3-204.6 Sales Document Type: 3-204.7 Sales Document Number Ranges: 3-214.8 Process Description – Sales Order Processing: 3-214.9 Process Description (To-Be): 3-214.10 Sales Order Data: 3-225 Shipping: 3-23Overview (Shipping) 3-235.1 Overview: 3-235.2 Outbound Delivery: 3-235.3 Scope of Implementation: 3-235.4 Business Specific Details (Shipping): 3-23

Definition:- 3-23

5.5 Outbound Delivery: 3-235.6 Post Good Issue: 3-245.7 Document Flow: 3-245.8 Overall Processing Status: 3-245.9 Automatic Updating: 3-24

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5.10 Process Description (TO-BE) : 3-24Process Explaination: 3-255.11 Delivery Processing: 3-255.12 Post Good Issue: 3-255.13 Outbound Delivery Data: 3-255.14 Process Desciption – Delivery Document Processing :3-265.15 Process Steps : 3-266 Billing : 6-26Overview : 6-266.1 Scope Of Implementation: 6-266.2 Business Specific Details (Billing) : 6-27

Definition: 6-27

6.3 Creation Of Invoive : 6-276.4 Invoice Cancelation/Reversal : 6-276.5 Automatic Updating Of General Ledger & Reports: 6-276.6 Document Flow: 6-276.7 Process Desciption (To-Be): 6-276.8 Final Invoice : 6-286.9 Invoice Data: 6-286.10 Process Desciption – Invoice Document Processing : 6-296.11 Process Steps : 6-296.12 Process Desciption – Collective Invoice Processing: 6-296.13 Process Steps: 6-296.14 Process Desciption – Invoice Correction Processing : 6-296.15 Process Steps: 6-296.16 Process Desciption – Pro-forma Invoice Processing: 6-306.17 Process Steps: 6-30

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I. Handling Procedure

Document Number:

Document Number Document date

VMS_STDOC_SD 12-04-2013

Version History:

Version Number Version date Summary of Changes Ref: Minutes of review

001 12-04-2013

Reviewers:

This document should be reviewed by:Name Signature Date

Mr. Nadeem Ansari

Mr. Faisal Masood

Approvals:

This document requires the following approvals. Name Signature Date

Mr. Nadeem Ansari

Mr. Faisal Masood

This document has been distributed to:

Name Signature Date

Mr. Adnan Bashir Khan

Mr. Nadeem Ansari

Mr. Arshad Ali

II. Objective:

The Structure Document is a core implementation document for SAP Implementations. This document defines the important information required for initialization and setup of the SAP.

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III.Overview of Module:

Sales & Distribution (SD) is one of the core and most-used modules of SAP R/3 products beside Financial (FI), Controlling(CO), Material Management (MM), and Production Planning (PP) modules.

The main areas covered by this module and the sub modules are: Pre-sales activities, including Inquiry and Quotation creation. Sales Order processing, including Sales Order (SO) creation. Shipping, including Outbound Delivery document creation. Billing, including Billing document and invoice creation.

Sales & Distribution (SD) is a module highly integrated with other SAP Modules as FI, CO, MM, PP & more. This can make SD a complex module, so as part of this document we will also try to detail a normal sales process and how the activities integrate and are covered by this module.

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1 Organizational Structure:

1.1 Sales Organization:

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The sales organization has a legal connection in that it represents the unit responsible for selling and therefore is responsible for Material liability and rights of legal recourse. All business transaction in Sales and Distribution has tobe processed financially within a Sales Organization.

SALE ORGINZATION DESCRIPTION8000 VMS Trading Company

1.3 Distribution Channel:

The distribution channel defines how different Materials reach to the customer, local, export or wholesaler.

Distribution Channel Description0001 DC VMS Trading

1.4 Divivsion:

A broad product range that could be sub divided into further grouping of products.

Division Description00 Medicine10 Toothpaste20 Surgical Instruments

1.5 Sales Area:

Which materials are managed in which organizational unit is determined by the sales area, that is, the combination of a sales organization, a distribution channel and a division. Sales documents in SAP R/3 System for VMS Trading Company are processed in one of the following sales areas.

Sales Organization Distribution Channel Division Sale Area8000 0001 00 8000-0001-008000 0001 10 8000-0001-108000 0001 20 8000-0001-20

1.6 Shipping Point:

Shipping point is an organizational element that manages shipping activities. Each outbound delivery is processed at a shipping point. A shipping point can be a physical location or a logical location. Shipping points are assigned to plants. A shipping point should have physical proximity to the plant to which it is assigned. At VMS Trading Company each plant will correspond to a shipping point and all the deliveries for the plant will be created from the corresponding shipping point. Usually same number is assigned to a shipping point as that it is assigned to its corresponding sales office and for plant.

Shipping point Description8001 Karachi

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8002 Lahore

2 Master Data :

USINEPECIFIC DETAILS (Master data)

2.1 Definition:

Master data forms the basis of sales and distribution processing. Data about the products as well as about the business partners (customer) is the basis for sales processing. Sales’ processing with the SAP R/3 system requires that the master data has been stored in the system.

2.2 Cutomer Master Data:

Customer master is a centrally shared data which can be used by all the logistics modules as well as the finance module. Information retained in the customer master record can both be descriptive and have functional control depending on the usage. The customer master data has three views:

General Data is maintained independent of the organizational elements. The data found here is common to all organizational structures within the client.

Sales Area Data is relevant for sales and distribution processes and is specific to a given sales area. Company Code Data is relevant for financial accounting processes and is specific for a given

company code.

A single customer master includes all the data necessary for processing orders, deliveries, invoices and customer payments.

2.3 Customer Master Data Process:

A customer is a business partner with whom the company sells the goods.

In sales and distribution, products are sold to business partners (customer). Data about the products as well as about the business partners is the basis for sales processing. Sales processing with the SAP R/3 System require that the master data has been stored in the system.

In addition to sales and distribution, other departments of the company such as accounting or materials management access the master data.

The processing of business transactions in sales and distribution is based on the master data. In the SAP R/3 System, business transactions are stored in the form of documents. These sales and distribution documents are structured according to certain criteria so that all necessary information in the document is stored in a systematic way.

2.4 Configartion Data:-

Accounts Group:

The nature of the customer and the required fields in the Customer Creation screen largely depends on the configuration of the Account Groups. Following account groups (with their number ranges) have been maintained for VMS TRADING COMPANY.

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Account Group DescriptionNumber Range

From To100- direct sale 100- direct sale 100000 199999110- indirect sale 110- indirect sale 200000 299999120- Intercompany sales 120- Intercompany sales 300000 399999

2.5 Partner Fuction:

Business partners having different business functions in sales and distribution cycle will be configured as partner functions. Following partner functions will be configured for VMS TRADING COMPANY.

Different business partners may carry out one or more partner functions. For this reason, you can assign individual business partners a number of partner functions.

Data on partner functions is stored in master records and can be used in Financial Accounting and Logistics.

A business partner can be a customer and a vendor at the same time if, for example, your customer also supplies goods to you or if a vendor is also one of your customers. In this case, you must create a customer master record and a vendor master record for the business partner. You can create a link between the two master records by entering the vendor number in the customer master record and the customer number in the vendor master record.

In SAP, there are several terminologies to maintain business partner in the system:

. Business Partner · Description

Sold To Party

Person or company that places an order for goods. The sold-to party can also perform the functions of the payer, bill-to party or ship-to party. In case of VMS TRADING COMPANY the Distributor/ MRS will be entered as sold to party

Ship To Party

Person or company to where we deliver the goods. The ship-to party can also perform the functions of the payer, bill-to party or sold-to party. In case of VMS TRADING COMPANY the Distributor/ MRS will be same as ship to party (Automatically Driven from the Sold to Party)

Bill To Party

Person or company to where we send the invoice document for goods. The bill to party can also perform the functions of the payer, ship-to party or sold-to party. In case of VMS TRADING COMPANY the Distributor/ MRS will be same as bill to party (Automatically Driven from the Sold to Party)

Payer

Person or company who pay the transaction .The payer can also perform the functions of the sold to, ship-to party or bill-to party. In case of VMS TRADING COMPANY the Distributor/ MRS will perform the function of payer therefore account receivable will be booked against the Distributor/ MRS (Automatically Driven from the Sold to Party)

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In most cases all the four functions are the same. So when sold to party is created, all other functions would be automatically created. We can create more than one ship to party for one sold to party/ Customer.

2.6 Customer Master Data and Process Flow:

System will always assign an internally generated number to each customer created Name, address and any other contact information is entered in General Data Screen All customers would be created for a sales area, which comprises the sales organization, distribution

channels and the division. Sales tax number and National Tax number will also be maintained in the customer master data Payment terms will be maintained wherever applicable. This information will be copied to subsequent

documents (Sales Order, Delivery Order etc.). Following are the Incoterm that will be used in VMS TRADING COMPANY.

Incoterm DescriptionFOB Free on board

Following are the Payment Terms (optional and variable) that are provided by FI/CO.

Serial No. Payment termsA001 Advance paymentA002 Immediate DueA003 7 DaysA004 15 DaysA005 30 Days

2.7 Customer Master Data:-

Any individual, company or government institution that has purchased or is purchasing any product or service from VMS TRADING COMPANY will be accorded the status of a customer with the presumption that such person or company or government institution will continue to purchase from VMS TRADING COMPANY in future as well. In SAP system a master record will be created for each customer. Following fields have been identified as critical and have been set to mandatory.

Field Name PurposeGeneral DataCustomer Name Unique customer nameCustomer Address Customer’s current address Customer City Customer’s city of operationsCompany Code Data

Reconciliation Account Recon account in G/L that is updated on postings for invoice

Sales Area DataDelivering Plant Location from where the stock is issued to the customerSales District A geographical sales district

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Sales Office A physical location (for example, a branch office)

Sales Group A group of sub-Zones who are responsible for sales processing

Customer Group A Group of Territories Output Tax Classification Identification for customer’s tax liability

Apart from the above fields, there are other standard fields maintained in the customer master for recording and maintaining additional details for any customer. However these fields are not mandatory and if no data is recorded, the system will not prompt the user for incomplete processing. However, while creating customer master; if the fields mentioned in the table are not filled with the relevant data then the system will not let the user to proceed further.

2.8 Sap Recommended Process Flow Chart For Customer Creation:

2.9 Integration:-

Business partners having different business functions in sales and distribution cycle will be configured as partner functions. Following partner functions will be configured for VMS TRADING COMPANY.

Partner Functions

1. Sold-to-Party

2. Ship-to-party

3. Bill-to-Party

4. Payer

Different business partners may carry out one or more partner functions. For this reason, you can assign individual business partners a number of partner functions.

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Creation of Customer Master

SALE

DEP

TUS

ER Customer Creation Request

Check for Duplicate

Customer in system

Customer Exist?

Inform User

Approval From Authorized person

Create Customer Master record

End

NO

YES


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Data on partner functions is stored in master records and can be used in Financial Accounting and Logistics.

A business partner can be a customer and a vendor at the same time if, for example, your customer also supplies goods to you or if a vendor is also one of your customers. In this case, you must create a customer master record and a vendor master record for the business partner. You can create a link between the two master records by entering the vendor number in the customer master record and the customer number in the vendor master record.

Credit Management enables for issuing a credit limit for each customer. Every time an invoice is posted (created in FI-AR), the system then checks whether the invoice amount exceeds the credit limit. Information functions such as the sales summary will help to monitor the customer’s credit situation.

Accounts Receivable (FI-AR) component manages accounting and the Sales and Distribution (SD) component manages sales processing. Credit limit for customers are maintained in the credit control area.

General information functions are also available for use with credit checks.

Automatic credit checks will be configured, which allows saving the sales order but blocks the same for delivery.

During order processing, the credit representative automatically receives information about a customer’s critical credit situation.

Accounts Receivable department is in a position to review the credit situation of a customer quickly and accurately.

Credit limits for the customer can be maintained in multiple currencies.

The credit master sheet displays such credit data as the current and maximum credit limit, and the total of deliveries, orders, and invoices outstanding. The credit overview shows certain additional data including dunning data, open items and texts on the customer.

Value Addition:

SAP system has one of the most enhanced master data management systems and organizes data on a single platform. Master data may be created discretely at remote locations however system accumulates all data in the central master data repository. For VMS TRADING COMPANYAccount Groups have been maintained to provide a consistent number range for the customers created in the system, enabling unique identification of the customer and homogenize master data maintenance.

Standard SAP provides enhanced master data management capability that allows maintaining customer specific data at three levels. The customer master data components are copied into sales documents whenever a customer is called in the document. All or any customer related values maintained in the master could be copied into the sales document.

All customer codes will be created as subsidiary ledger account to a natural account code of trade receivables, which will considerably reduce trial balance maintenance.

All customers will be created in a company code specified within Financials module. The company code will be assigned to a credit control area, which will enable automatic credit control. Therefore credit limits can be maintained centrally for each customer code.

All changes in the customer master will be traceable from a log containing records of all updates and updated values. System maintains a log detailing the user responsible for the updates.

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Customer specific Payment Terms can be maintained in the customer master which can be defaulted into sales order document and subsequently to the billing document.

Customer specific Output Tax Classification can also be maintained which would automatically exempt or calculate taxes in the sales order and subsequently in the billing document for the customer as per his tax classification.

Incoterms can be maintained specifically for each customer in the customer master. The system will default the incoterms during sales order processing from the master data; however it can be manually updated to match the incoterms of the LC during sales order processing.

3 Customer Material Info Record:

The customer info record defines the inspection requirements for a specific customer/material combination (per sales organization). You can use the customer info-record to override the default customer specifications. If you have maintained the customer data in the customer-material information record, you can access material using this customer data rather than having to find the actual material number. When you create the information record, the system copies some of this data from the customer master record and the material master record. You can change this data in the information record. If a customer-material information record exists, the data defined there has priority over data in the customer and/or the material master record and is copied accordingly, into the individual items.

3.1 Condition Master Data:

Condition master data/records allow the user to maintain pricing conditions in the SAP system. These conditions will be retrieved and pricing elements will be copied at the time of processing sales documents. All the pricing elements of day-to-day business transactions at VMS TRADING COMPANY required for automatic processing will be maintained in the system as condition records. Conditions records actually represent a set of allowable circumstances that apply in the event of a sales transaction. The circumstances may include individual pricing elements or the combination of different pricing elements. These pricing elements include material, customer, date, Price, Surcharge/discounts, freights & tax etc.

The following pricing conditions types will be maintained for VMS TRADING COMPANY in pricing master data. Any other pricing condition might be included if identified during the realization phase.

3.2 Conditions and Agreements (Pricing):

3.3 Process defination:

The term pricing is used broadly to describe the calculation of prices (for external use by customers) and costs (for internal purposes, such as cost accounting). Conditions represent a set of circumstances that apply when a price is calculated. For example, a particular customer orders a certain quantity of a particular product on a certain day. The variable factors here - the customer, the product, the order quantity, and the date (Key combination at the time of generating sales orders). The information about each of these factors can be stored in the system as master data. This master data is stored in the form of condition records.

Agreements can be defined in the system in various different ways:

In the customer master record (for example, Term of payments required) As individual master data: rebate agreements

3.4 Configuration Data:

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Master data for pricing can be maintained under the Key combination of the following fields:

Sales Organization Distribution Channel Division Sold-to Party Material Number

3.5 Pricing Data master Maintaince:

Pricing rate of the Brand (Product) should be maintained in master data, so that during order processing, the system will get the price valid for that particular customer or product in specific period.

3.6 Pricing conditions (To-Be):

Condition Type DescriptionZPRP EX-Factory PriceMWST Sales Tax with amount according to Government RegulationZFRE FreightZNET Net Price

Pricing conditions will be maintained by Finance Department.

3.7 Sap recomended Process Flow Chart:

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Integration :

Each price relevant condition type is assigned to an account key. Account key is assigned to a GL account in FI-SD integration on the basis of Customer Account Group, Material Account Group and the Account Key, all condition values are posted to the appropriate GL account on the basis of the account key.

System enables to provide output tax relevance on the basis of customer or material master. Condition type for output tax MWAS is configured in a way that it posts to output tax payable account only after ascertaining that the material and customer combination allows the posting to output tax account.

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4 Sales Order Processing:

4.1 Overview:

The sales order is a document between a sales organization and a sold-to party about delivering products for defined prices, quantities and times. In the sales order, we record the customer number, the product customer ordered and the delivery date if necessary. Then the system automatically proposes data from the relevant master records

4.2 Scope of implementation:

The scope of implementation at VMS TRADING COMPANY for the aforementioned data involves usage of this information in the Logistics arena.

Sales OrderTopic Yes No

Sales Basic Functions Pre Sales Outline Agreements (Customers) Sales Orders

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4.3 Business specific Details (sales order Process):

Definition:

The sales order is a document between a sales organization and a sold-to party about delivering products for defined prices, quantities and times. In the sales order, we record the customer number, the product customer ordered and the delivery date if necessary. Then the system automatically proposes data from the relevant master records:

From the customer master record of the sold-to party, the system proposes sales data such as internal organizational element assigned to the customer, shipping data such as default delivering plant, and billing data such as term of payment. In addition, the system copies customer-specific master data about texts, partners, and contact people at the customer site.

For each material in the sales order, the system automatically proposes data from the relevant material master records, such as availability check, tax determination, and weight and volume determination.

4.4 Status Anlaysis:

The system always maintains a status of each sales order. The sales team can use this feature to answer customer queries on dispatch of his material as well as use to track the progress of the pending dispatches at their end.

4.5 Automatic Detemination:

While creating an order in SAP, the system automatically determines the following and hence reduces the chances of human error.

Standard Pricing Ship to Party Bill to Party Payment Terms Shipping Point Delivering Plant

Configuration Data:

4.6 Sales Document Type:

The following sample document types are used to process customer orders

4.7 Sales Document Number Ranges:

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Sales Order Type Usage

Standard Order This order type is used to handle Distributor Sales and MRS Sales

Cash Order This order type is used to handle Distributor Sales and MRS Sales on Cash Basis

Inter Company order This order type is used to handle intercompany Sales


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Following sales documents and their respective number ranges have been defined for VMS TRADING COMPANY.

Sales Documents Usage

Sales DocumentNumber Range

From To

ZPOR(Standard Order)

To create and record all standard sales orders for Medicine Division, 0000000001 0999999999

4.8 Process Description – Sales Order Processing:

Customer places a purchase order along with the credit terms already approved by VMS TRADING COMPANY; as such the all sales not accompanying payments or customer with no reflection of credit balance in the AR will be processes against credit. For credit management to function appropriate it is necessary to maintain credit master data in the system. System will enable the user to save the sales order in case the credit limit maintained in the system is exceeded; however system will not allow to process delivery of such sales orders.

4.9 Process Description (To-Be):

Customer sends a Purchase Order with or without demand draft. Sales department / International division receive a customer purchase order for goods. Sales department / International division evaluate the customer purchase order and input the

details in the SAP system after determining the correct sales order type by using transaction code VA01.

If the sales order is created with reference to a quotation sent earlier the quotation number will be referenced into the sales order before sales order creation. Once all sales relevant details have been punched in the system runs standard validations (e.g. material availability, pricing conditions, shipping point and payment terms etc.). System also validates the credit limit from the credit master data maintained. If the net value of the sales order is within the credit limit set as per the credit master data maintained, then the system proceed with saving the sales order and else system do save the order but with a credit limit check. Then the order needs to be released by finance department after updating the credit limit or updating the customer credit limit in the credit master data.

System generates two printout of sales order document on saving the sales order. File one copy in record and send the other to the customer.

Intimate the shipping point (factory) for delivery via email

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4.10 Sales Order Data:

Following Information is entered at the Sales Order Level:

Information Triggers

Sales Order Number Internally Generated Number of SAP

Sales Order Date Current date will be default.

Sold to Party Customer code

Ship to Party The ship to party is going to be determined on basis of sold to party

Material NumberProposed automatically through item proposal but can be over written as long as the material is included in the Material Listing of that customer

Material Quantity Required quantity of the material

Payment Terms Payment terms will be proposed from Customer Master

Pricing Pricing will be determined automatically

Division The concerned product group

Customer Sales Tax Information Proposed from Customer Master

Material Sales Tax Information Proposed from Material Master

Currency Default from Customer Master

Pricing Date Current date will be default

Delivering Plant Will be determined automatically from Customer / Material Master

Shipping Plant Will be determined automatically

5 Shipping:

Overview (Shipping)

5.1 Overview:

After the sales order is booked into the system the dispatch is due. Dispatch processing in SAP would lead to the activity of issuing the goods from shipping point to the customer. The dispatch note will be generated with reference to the sales order. The system provides the functionality of generating a delivery due list, this list is date specific.

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5.2 Outbound Delivery:

Outbound Delivery commences the shipping process. The outbound delivery document can either be created with or without reference to the Sales Order. During the outbound delivery process the shipping planning information is recorded, status of shipping activities is monitored and the data which is accumulated during the process of shipping is documented.

5.3 Scope of Implementation:

The scope of implementation at VMS TRADING COMPANY for the aforementioned data involves usage of this information in the Logistics and Finance arena.

Outbound Delivery

Topic Yes No

Sales Order Processing Delivery Processing Delivery Updating Post Good Issue Process

5.4 Business Specific Details (Shipping):

Definition:-Shipping:-

Shipping is defined as “The act or business of transporting goods”

5.5 Outbound Delivery:

Outbound Delivery commences the shipping process. The outbound delivery document can either be created with or without reference to the Sales Order. During the outbound delivery process the shipping planning information is recorded, status of shipping activities is monitored and the data which is accumulated during the process of shipping is documented.

5.6 Post Good Issue:

Subsequent to the outbound delivery process is the process of Post Goods Issue. This process involves posting of the actual quantity of goods delivered from the Shipping point that may differ from the quantity to be delivered. In order to post goods issue, all necessary shipping activities must be completed.

5.7 Document Flow:

Tracking has been made easier through the functionality of Document flow. SAP user can view not only the list of preceding and subsequent documents (if any) but can also view those documents provided they have the necessary authorization.

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5.8 Overall Processing Status:

System also provides the facility of checking the overall processing status of a delivery document at any point of time. The status of delivery document remains Open as long as the document has not been posted (post goods issue). It changes from Open to Being Processed at the time when delivery has been posted. And when sales tax invoice is created against that delivery the system automatically converts it into Completed. The status of sales order will also change; keeping record that delivery against sales order has been created.

This functionality of processing status would help the dispatch staff and the sales department to keep an on-line track of the deliveries.

5.9 Automatic Updating:

Once the dispatch document has been completed, the system would cater for automatic updating of the material inventory. In addition to this, all the reports, which are relevant to dispatch, would also be updated to show the dispatches.

5.10 Process Description (TO-BE) :

Process Explaination:

5.11 Delivery Processing:

The delivery order will be created with reference of sales order. The user can also view the orders to be delivered from SAP standard List of outbound deliveries report.

At Depot, outbound delivery will be created against the sales order. On the basis of Delivery Note (Outbound Delivery Output) physical Load of Liquid will be done. After loading, physical checking of Liquid is same as AS-IS Process.

5.12 Post Good Issue:

After Delivery Note and Liquid Load Out, the Depot Gate Office staffs physically re-check the Liquid Load and also Delivery Note will be cross checked with sales order.

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Post Goods Issue will be done by the Depot Gate Office Staff after all verification. Following registers are maintained automatically by the system.

Stock Balance Reports (Aerated Water Register) Delivery Related Reports (Distributor/ MRS Wise Liquid Reports)

Once the Post Good Issue will be done in system then the finished good stock will be updated and the cost of goods sold will be recorded in system.

5.13 Outbound Delivery Data:

Information Required Triggers

Delivery Number Internally Generated Number of SAP

Dispatch Note Date Current date will be default

Sold to Party Code Customer code

Sold to Party Name Customer Name from Customer master data

Ship to Party Code Ship to party will be copied from Sales Order (Same as Sold to Party)

Ship to Party Name Name from Ship to master data (Same as Sold to Party)

Material Number Will be copied from Sales Order

Material Description Will be copied from Sales Order

Material Quantity Confirmed quantity will be copied from Sales Order.

Division Will be copied from Sales Order

Incoterms (Delivery Terms) Will be copied from Sales Order

5.14 Process Desciption – Delivery Document Processing :

Delivery process is initiated when a sale department completes the sales order processing and transfers the requirements to the shipping point. The delivery is completed when goods are loaded into the vehicle, shipment documents are updated, goods are posted for issuance and shipment cost document is processed. The result of delivery processing is a delivery challan, which is sent to the customer as a token of goods issuance against the sales order of that particular customer.

5.15 Process Steps :

After Order processing completed, intimation is sent to Logistics department for delivery via email or telephone or logistics department can daily run a delivery due list to confirm the number of orders to be shipped in a day.

Logistics department process delivery due list and create deliveries via transaction code VL01N in SAP system

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System generates loading slip prints (2 copies), one of which is filed for record and other is used for loading.

After loading is completed, logistics department creates shipment document using via transaction code VT01N.

Also process shipment costs via transaction code VI01 Goods Issue is posted and loading slip is updated automatically. Print outs of updated loading slip and

delivery challan are generated which are sent, along with goods, to customer.

4 Billing :

Overview :

Billing represents the final processing stage for a business transaction in Sales and Distribution. Information on billing is available at every stage of order processing and delivery processing. Billing component include creation of invoice on the basis of order or deliveries for complete or partial delivery quantities.

6.1 Scope Of Implementation:

The scope of implementation at VMS TRADING COMPANY for the aforementioned data involves usage of this information in the Logistics and Finance arena.

Billing

Topic Yes No

Basic Functions Processing Billing Documents Invoices Account Assignment Condition Records

6.2 Business Specific Details (Billing) :

Definition:

A sales document used to bill a customer for a goods delivery. Deliveries which are carried out on the basis of sales orders are invoiced to the customer. If no complaints are made about the delivery, the business transaction is considered complete from the sales point of view.

When you create an invoice, you can refer to an order, a delivery, individual order or delivery items, or even partial quantities within an order item or a delivery item.

6.3 Creation Of Invoive :Invoice can only be created with reference to a dispatch note and sales order.There are two ways to initiate Invoice processing which are as follows;

Individual Creation: Invoice can be created individually against each delivery order

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Billing Due List: Multiple invoices can be created at once through a Billing Due list which will list all deliveries for which invoice is yet to be created.

6.4 Invoice Cancelation/Reversal :

Reversal of Invoice can be created when the Invoice has not been sent to the customer. In case where Invoice has already been sent to the client a credit note will be issued against the Sales Tax Invoice.

6.5 Automatic Updating Of General Ledger & Reports:

Once the Invoice document has been created, the system would cater for automatic updating of the Account Receivable ledgers and Account Payable ledgers. In addition to this, all the reports, which are relevant to Sales and Receivables, would also be updated.

6.6 Document Flow:

Tracking has been made easier through Document flow. SAP user can view not only the list of preceding and subsequent documents (if any) but can also view those documents provided they have the necessary authorization. You can also branch into customer and material master, credit master and sales reports from there.

6.7 Process Desciption (To-Be):

6.8 Final Invoice :

Final invoice to the customer is generated on the basis of sales order that is created in the system, now you can bill the customer for the quantity present in the sales order. In this process two outputs will be taken from the system one is of Sales tax invoice that is created Product Wise in order to calculate aging customer/ material wise and the other is of Commercial invoice with detail of all materials in the delivery order (material code wise). The number of Sales tax invoice and commercial invoice will be same.

In case of MRS Sales, the invoice process will be same instead of Pending Invoice in the AS-IS Process.

6.9 Invoice Data:

The following information is maintained in the INVOICE

Information Required Triggers

Invoice Number Internally Generated Number of SAP

Invoice Date Current date will be default

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Sold to Party Code Customer Code will be copied from Sales Order

Sold to Party Name Customer Name will be copied from Customer Master

Bill to Party Code Bill to party will be copied from Sales Order (Same as Sold to Party)

Bill to Party Name Bill to party Name will be copied from Customer Master (Same as Sold to Party)

Payer Code Payer will be copied from Sales Order (Same as Sold to Party)

Payer Name Payer Name will be copied from Customer Master (Same as Sold to Party)

Material Number Will be copied from Sales Order

Material Description Will be copied from Sales Order

Material Quantity Will be copied from Dispatch note.

Division Will be copied from Sales Order

Pricing Will be copied from Sales Order. Following are the conditions will have an impact on invoice where applicable

Sales Tax MRS Commission/ Surcharges Price-Off Discount (Like in Key Accounts) Surcharge (Like in Key Accounts)

Customer Sales Tax Information

Will be copied from Sales Order

Material Sales Tax Information

Will be copied from Sales Order

Currency Will be copied from Sales Order

6.10 Process Desciption – Invoice Document Processing :

VMS TRADING COMPANY might need to process individual invoice documents for a delivery document as per the business need. SAP system enables to print both single and multiple sales invoices as the case may be.

6.11 Process Steps :

After completion of delivery processes (3.6.1), intimation is sent to Billing department where billing process starts.

Relevant user inputs the delivery number of the delivery document to be billed and executes the billing process in SAP system using transaction code VF01.

After inputting the delivery number, user creates invoices by executing a billing run. System generates invoices printout of each invoice. One copy is filed for record and the other send to the customer.

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6.12 Process Desciption – Collective Invoice Processing:

VMS TRADING COMPANY might need to process collective invoice documents for a delivery document as per the business need. SAP system enables to print both single and multiple sales invoices as the case may be.

6.13 Process Steps:

After completion of delivery processes (3.6.1), intimation is sent to Billing department where billing process starts.

Relevant user executes collective billing process in SAP system using transaction code VF04 and selects deliveries to be billed from billing due list.

After selecting deliveries, user creates invoices by executing billing run. System generates invoices printouts (3 Copies) of each invoice. One copy is filed for record, one is sent to Sales Coordination department and one to the customer.

6.14 Process Desciption – Invoice Correction Processing :

In case of wrong billing to customer, correct invoice can be created and printed from the system by processing a special sales order and billing it accordingly. Invoice Correction sales order can be created in the system with reference to the incorrect invoice documents.

6.15 Process Steps:

Customer sends the invoice correction request to concerned department. Concerned department verification and evaluating the request and create invoice correction order in

system, then forward then request for approval. Request is forwarded to approving authority. If approved, the approving person / relevant user using via transaction code VA02 removes the billing

block from the request. In other case reason of rejection is entered and request is sent back to concerned department who intimates the customer about the request rejection reason.

Relevant invoice user who runs the billing run via transaction code VF01 receives approved request. System generates credit or debit memo along with corrected invoice (3 Copies). One copy is filed for

record, one is sent to concerned department and one to customer.

6.16 Process Desciption – Pro-forma Invoice Processing:

In case of export sales customer request for a pro-forma invoice document to initiate export sales process. Pro-forma invoice is and essential document in the export sales process, however posting the pro-forma invoice does not post any accounting document in the system. Accounting document is only posted to in the system after actual billing of the export sales delivery. In case of VMS TRADING COMPANY pro-forma invoice can only be processed against a sales order.

6.17 Process Steps:

Customer sends request for pro-forma invoice, along with Purchase order to International division. International division makes copy of PO and sends it to finance department. Finance department create a sales order and inputs the pro-forma invoice details in SAP system using

via transaction code VF01.

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System generates printout of pro-forma invoice (2 copies). One copy is filed for record and other (signed) send International division from where it is signed and forwarded to the customer.

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SD

Documents

Transcript of SD