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Logistics : MM and its sub-modules (WM, IM, PO, LIS)
14 posts • Page 1 of 1
In OMR6, we have so many tolerance key and every tolerance key have diff value defined.
PP Price variance
PS Price variance: estimated price
ST Date variance (value x days)
VP Moving average price variance
When we post the invoice against to the PO, how does the system know which tolerance key we want to check? where is this assignment?
As soon as a certain tolerance key is activated for your own company code in Transaction OMR6, that tolerance key will be checked ie. the system will check all tolerance keys and pop up the related message (either W or E dependent on how you set up in OMRM Transaction).
My only question now is what the usage of BD Form small differences automatically???
I know PP (Price variance) use to check the price variance enter in the MIRO against to the price in GR. But what about BD???
Basically, the BD Transaction/Event Key is used in the case of so-called Total-Based Invoice Reduction. It does particularly refer to the scenario where a vendor invoices a material with higher conditions that agreed in the purchase order. If Invoice Verification determines a difference between the net total of the invoice items and the invoice document (minus tax and unplanned delivery costs), for invoice with small differences it is often too much work to try and find the reason for the difference. Instead, the system can post the invoice if the difference falls within a predefined vendor-specific tolerance. A typical example is that if the total value of the invoice document is 100,502 USD while the net total of the invoice items is 100,500 USD, then the posting lines of the accounting document during IR posting is -
Dr GR/IR Clearing Account (WRX) 100,500
Cr Vendor Account 100,502
Dr Clearing Account for Invoice reduction (BD) 2
At the same time, the Credit Memo will be also created with the following posting lines -
Dr Vendor Account 2
Cr Clearing Account for Invoice Reduction (BD) 2
Thanks for the detail explanation. However, to make it simple, let say I have 100 USD as invoice amount received from the vendor. I then enter the 100 USD (no other cost involve, i.e. zero tax , no delivery charge, etc) at the invoice hearder. Then enter the PO number at the item invoice item, the amount is defaulted automatically, which is 102 USD.
Now, because I set the value in BD key is 2 USD, then I can post it right?
As I have said the BD Tolerance Key is used for the case of Total-Based Invoice Reduction scenario ie. the vendor invoiced amount is higher than the proposed amount. Therefore, in OMR6, you can only set the Upper Limit instead of Lower Limit. If the invoiced amount is 102 while the proposed amount is 100, then BD will be applicable.
I think it is hard-coded by SAP
In that case, probably I confused with the PP Tolerance Key then. So, the BD will check the price between the invoice hearder and item. i.e.
PO Net Price = 100 USD
GR = 100 USD
Inovice received from vendor is 102 USD
value set in the BD key = 2 USD
Now, in MIRO, I would enter 102 in the Amount field (WRBTR).
Then enter the PO and the price defaulted automatically. (This price is based on the GR price, right?) Now, the price is 100 USD. Because of the BD key, then I was able to post the inovice.
Please confirm if my understanding is correct.
In that case, what is the use of PP Key?
Yes, this is how BD is going to work. Again, the basic difference between PP and BD is that in case of PP, the system will make the validation against each and every Invoice Line item whereas the BD is only applicable where there is a slight difference between the total value of invoiced items against the invoiced amount without validating each and every invoice item.
I am confused now. What do you means by:
"BD is only applicable where there is a slight difference between the total value of invoiced items against the invoiced amount without validating each and every invoice item."
i.e. In my BD setting, I have 2 USD as Upper Value. And my PP setting, I have 10 USD as Upper Value.
If the total amount of the invoice is 101 USD, and the invoice Item is 100 USD (which defaulted from PO), which key will be used for validation?
First of all, during LIV process, all tolerance keys are validated (as soon as they are activated in OMR6). During invoice entry, you can make manual change in either invoice header or invoice line item. If you are changing the invoice item, then PP tolearance key will be validated but if there is not any manual change in the invoice item but you manually update the invoice amount at the header level (to comply with the vendor invoice), then BD will be validated. In your example, since there is not any change in the invoice item (100 USD), therefore, PP tolerance key will not be validated but only BD (since you have to change your invoice amount at the header level from 100 into 101 to accommodate vendor invoice amount).
Thanks for the note. I have a question now. Do you know under what business scenario that the amt in the item line will be changed? This should be defaulted based on GR... if we change, i.e. reduce the increase the amt in the item line (which is different from GR amt), then what will happen to the G/L account posting? no correct already...
The typical example is when you have accepted what you maintained in your PO pricing condition is not as accurate as expected and therefore, it is adjusted during LIV process.
14 posts • Page 1 of 1
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