i), The Integration point between PP and MM

This document explains the integration points between Production Planning and Materials Management Module.

Following are the integration points between PP and MM modules....

1. Direct creation of Purchase Requisitions for externally procured materials during MRP.

2. Creation of Purchase requisitions for non-stock items during Production Order creation.

3. Creation of Purchase requisition during subcontracting for externally processed operation

4. Creation of reservations for components of production order during Production Order creation.

5. Various Goods movements for Production order like Goods Issue of Components, Goods receipt of the
Manufactured Product...

6. Generating schedule lines for scheduling agreements through MRP run.

Now let us see the settings and flow we need to adopt for this to work in the system....

1. Direct creation of Purchase Requisitions for externally procured materials during MRP.

During MRP run for header material on the MRP control parameters make the setting as 1 for parameter Create
Purchase Req as shown below. This will ensure creation of Purchase requisitions for externally procured materials
like Raw materials and Packing materials after MRP Run..
2. Creation of Purchase requisitions for non stock items during Production Order creation.

During creation of BOM if you enter item category as NON stock item (N) then system will ask for the Purchasing
relevant data as shown below
Now system will ask you to enter the data relevant for purchasing like Purchasing Organization, Price, Purchase
Group, vendor and other details as shown below

This data is used for creation of Purchase requisitions for Non-stock item during production Order creation....
3. Creation of Purchase requisition during subcontracting for externally processed
operation

During subcontracting process if any operation is performed by the external vendor, for sending the material to the
vendor against Purchase order we need Purchase requisition. We need to make following settings to make sure
Purchase requisition is created during Production Order creation...

assign the control key with indicator activated Externally processed operation to the external operation in the routing
as shown in the below screen shots..
For the externally processed operation assign external processing parameters in the operation details as shown
below.

Enter details of Purch. Organization, Purchasing group, Material Group and others as per the requirement.
the above settings ensure creation of Purchase requisition during Production Order creation for externally processed
operation...

4. Creation of reservations for components of production order during Production Order

creation.

During production order creation reservation is created for the components which can be seen in the production order
header in the Assignment tab shown below....
these reservation details can be seen through transaction MB23...
5. Various Goods movements for Production order like Goods Issue of Components, Goods
receipt of the Manufactured Product...

Following are the goods movements against Production order during which material documents are created.during
these transactions stock reductions and stock increasing happens accordingly....

Goods issue of components - 261 movement..through MB1A

GR of the header material - 101 movement..through MB31...
All the goods movements in a production order can be seen through the below path
iii), The Integration point between FI and MM
MM-FI integration: A conceptual understanding

Most of us are comfortable with SD-FI-COPA integration concepts as it is easy to correlate and
understand. But, when it comes to MM-FI integration, many of us find difficulties in understanding the
concepts and account determination process. When I was trying to analyze my first issue related to how a
stock account is determined in a valuated transaction, I was lost in OBYC. Let us try to understand few
terminology used in MM-FI integration concepts. Once we are familiar with the concepts, we will further
discuss account determination process in a stock movement related transaction.

Valuation area:

Stock of a material owned by a company is an asset to the company. Valuation area defines the
organization level at which materials are valuated.
SAP has provided two options for valuation.

1. Valuation at plant level: All materials are valuated at plant level.

2. Valuation at company code level: All materials in all plants of a company are valuated at company
code level.

This setting is defined in t-code OX14.

Valuated stock:

Total valuated stock = Stock in unrestricted use + Stock in transit between storage locations/warehouses
of a plant + Stock in quality inspection.

Material type:

This defines the type of material.

EG: Raw material, Finished goods etc.

Material type is defined during material master data creation.

Movement type:
This defines the type of material movement from one place to other. Movement type enables the system
to find predefined posting rules determining how the stock and consumption accounts are to be posted.
All possible goods movements are already defined by standard SAP

EG: Movement type 101 refers goods receipt

Movement type is entered while posting stock movement related transactions. Most of the time, standard
SAP automatically derives the movement type based on transaction code.

EG: If we go to MIGO, default movement type 101 is displayed by system.

Valuation class:

Valuation class is defined for the combination of plant and material (In Accounting 1 view of material
master).

Valuation class allows posting of stock values of

1. Materials of same material type to different G/L account (Different valuation class is assigned in
different plants for the same material)
2. Materials of different material type to same G/L account (Same valuation class is assigned to
materials of different material type)

Note: G/L accounts can be defined at valuation class level along with other parameters.
Valuation grouping code:

Valuation grouping code combines the valuation areas having same business properties for the account
determination. This reduces number of entries to be created for automatic account determination for the
stock postings.

EG: Valuation area 1 and 2 are required to be posted to same G/L account, these are grouped to
valuation grouping code ABC and G/L is determined based on valuation grouping code and valuation
class.

Before using valuation grouping code, it needs to be activated in OMWM.

Valuation grouping code is assigned to valuation area in t-code OMWD.

In below example, five valuation areas are assigned to same valuation grouping code.

Account modification/General modification:

This key is used to determine different G/L account for the same kind of goods movement based on origin
and target.

EG: During Goods issue, offsetting G/L is determined from transaction key GBB. If business wants to post
to different G/Ls for goods issue for cost centers (Movement type 201) and good issues to orders
(Movement type 261) for the same material and plant, Account modifier can help here. To understand this
better, let us go to t-code OMWN where we define the transaction key and account modification for the
movement type.

Transaction key which we see in OBYC is determined based on the movement type. In below screenshot,
you can see all parameters are same for movement type 201 and 261 except account modification.

Please read F1 help on different fields in this screen to know more about functionality of each field.
 T-code OMWN:

When material document is posted with these movement types, offsetting account is determined from
transaction key GBB based on account modifier and valuation class.

From below screenshot, you can see that, different offsetting G/L account can be determined for the same
transaction key and valuation class.

By Default, Standard SAP defines account modification keys for below transaction keys. User defined
keys can also be defined and respective account determination settings can be maintained.
GBB (offsetting entry for inventory posting)
PRD (price differences)
KON (consignment liabilities)

Below are the modification keys defined by SAP (Extracted from F1 help).

Modifiers for GBB

For the transaction/event GBB (offsetting entry for inventory posting), the following account groupings have already
been assigned to the relevant movement types:
AUF: for goods receipts for production orders with account assignment
BSA: for initial entries of stock balances
INV: for expense/revenue from inventory differences
VAX: for goods issues for sales orders without account assignment object
VAY: for goods issues for sales orders with account assignment object
VBO: for consumption from stock of material provided to vendor
VBR: for internal goods issues (e.g., for cost center)
VKA: for consumption for sales order without SD
VNG: for scrapping/destruction
VQP: for sampling
 ZOB: for goods receipts without purchase orders
ZOF: for goods receipts without production orders

Modifiers for PRD

If you also activate account grouping for transaction/event PRD (price differences) when you make the settings for
automatic postings, the following account groupings are already assigned to the relevant movement types in the
standard:
none for goods receipts and invoice receipts for purchase orders
PRF: for goods receipts for production orders
PRA: for goods issues and other goods movements

Modifiers for KON

If you also activate account grouping for transaction/event KON (consignment liabilities) when you make the settings
for automatic postings, the following account groupings are already assigned to the relevant movement types in the
standard:
none for consignment liabilities
PIP: for pipeline liabilities

How are the account determination attributes determined for each

transaction key/event?

Did you observe different set of fields appears for different transaction keys in OBYC while maintaining
G/L account? Yes. This is defined in Rules for the transaction key.

EG: Select transaction key AUM in OBYC and click on "Rules" in toolbar.

You can see that general modification and valuation modifier is active.
If you go to G/L account maintenance for this key, you would see the same fields.

Quick snap of MM-FI Integration process:

When we do material posting for a valuated material, below flow happens.

1. Movement type and other attributes like special stock indicator, movement indicator etc are determined
based on business transaction like goods receipt for PO, production order etc.(OMWN). This is defined by
standard SAP.
2. Transaction key/event and account modifier is identified based on movement type and other standard
attributes in step 1 (OMWN)
3. Valuation grouping code activation is checked from OMWM
4. If active, for the given valuation area, valuation grouping code is identified from OMWD
5. For the identified transaction or event, check if valuation grouping code is active or not in OBYC (Click
the rules button for the transaction key)
6. Valuation class is determined from material master.
7. Based on the above identified attributes, select the G/L account from OBYC.

If system cant find any account for the found attributes, stock posting cant be done and system through
clear error stating for which combination of attributes, G/L account is missing. Such errors are mostly
seen during go live/while posting to new materials due to missing G/L account maintenance or due to
incorrect valuation class in material master data.

Now you know the process, here is the short cut to find out G/L.
Account determination details are stored in table T030. If you want to know based on what details XXX
account is determined, simply give that G/L in T030 table in field KONTS. This gives the possible
combination of entries where this G/L is assigned. We can further drill down based on the filtered entries.

Please share your valuable feedback, thoughts and add additional information/corrections if any

Check out the next blog in this series.

MM-FI integration: Account determination simulator

MM-FI integration: Account determination simulator

Note: Assuming that reader is aware of MM-FI integration concepts. You can go through below blog as
well to understand the MM-FI integration concepts.

MM-FI integration: A conceptual understanding

Now we know how MM and FI are integrated and how the account determination happens. If we want to
test inventory account determination, neither you need to do actual material posting in the system nor go
through master data and customization to identify the accounts. SAP has delivered account determination
simulation tool.

This helps to find how an account is determined while posting stock related transactions. We just need to
input plant, material, movement type and select the transaction we would like to check say GR for
purchase order, GR for process order etc. Based on above inputs, system would read customization,
master data and simulate the account determination process. Apart from above, system would also
identify missing account assignments for a given transaction. This would further help to analyze issues in
an easy manner.

Go to T-code OMWB and close the initial popup. Click on Simulation button.

Fill in plant, material , movement type and enter. Transaction list would be automatically refreshed
based on the movement type. Double click on required type of transaction to be checked say GR and
click on Account assignments.
In next screen, we can see the list of all available transactions possible for this movement type, plant
and material combination. Some fields like material type, valuation class etc. are derived from material
master data. Some fields like valuation area, valuation grouping code etc. are derived from
customization of the plant.
 In this screen, we can see what all accounts are determined for different kind of transactions.

EG: For Inventory posting, you can see Debit/Credit posting keys and respective G/L accounts. If there
are any missing account assignment for a given transaction, this is also highlighted with text
as Missing.

In above example, you can see this happened for Purchase account and purchase offsetting account.
We dont have any account assignments here as we are not using this scenario. By this way, we can
clearly identify the gaps in account assignment without even doing the actual posting.

We can change to different movement types and transaction combinations and see how account
determination happens and based on what fields it happens. You can try this in your system for various
permutations and combinations.

Second feature available with this tool is, to check the screen layout. This would help to identify any
conflicts in screen layout rules for the inventory G/L account item during material document posting.

Screen layout for the inventory account item is determined at two levels.
1. From field status group of movement type
2. From field status group of inventory G/L account.

Click on Check screen layout button. In Next screen, we can see what is the field status set at
movement type level and G/L account level. We should ensure that, there is no conflict between these
two field status exist.

EG: We cant have a field mandatory in one FSG and suppressed in other FSG. Posting would fail in
such cases.

Sample output:
 Just hover on the small ICON to see if a field is Mandatory/Optional/Suppressed/Display only. Any
conflicts found should get reported in the error log in tool bar.

In case of conflicts, priority would be given in the sequence below with the exception of Required and
suppressed combination which is not allowed.

1. Suppressed
2. Display
3. Required
4. Optional

Third option provided by this tool is, where used list of G/Ls. This would help to Identify in what all
scenarios a G/L has been configured in the system.

From the main screen of OMWB, click on where used list of G/L.

Enter company code and valuation area in next screen and execute.

Sample output:

This output shows the list of valuation classes and transaction keys a G/L has been assigned to.
Hierarchy is as below.

Chart of accounts
|-G/L account
|-Valuation class
|-Transaction event key
|-Account grouping code

Hope this information would be helpful in your projects

Your valuable feed back/comments are much appreciated.

ii), The Integration point between SD and MM
1. When you create sales order in SD, all the details of the items are copied from Material master of MM.

2. MRP and availibility check related data is also taken from MM although you control this data in SD also.

3. While you create inbound/outbound delivery with reference to a sales order,the shipping point determination takes
place with the help of the loading group, plant data, shipping conditions etc. This also refers to Material Master.

4. The material which you are entering in a sales order must be extended to the sales area of your sales
order/customer otherwise you cannot transact with this material.

5. Various Goods movements for sales like Goods Issue of delivery, Goods receipt of the returned Product...

SD Integration points with other modules

SD module is highly integrated with the other modules in SAP.

Sales Order
Integration Points Module
Availability Check - MM
Credit Check - FI
Costing - CO/ MM
Tax Determination - FI
Transfer of Requirements - PP/ MM

Delivery & Goods Issue

Integration Points Module
Availability Check - MM
Credit Check - FI
Reduces stock - MM
Reduces Inventory $ - FI/ CO
Requirement Eliminated - PP/ MM

Billing -
Integration Points Module
Debit A/R - FI/ CO
Credit Revenue - FI/ CO
Updates G/ L - FI/ CO
(Tax, discounts, surcharges, etc.)
Milestone Billing - PS

Return Delivery & Credit Memo -

Integration Points Module
Increases Inventory - MM
Updates G/ L - FI
Credit Memo - FI
Adjustment to A/R - FI
Reduces Revenue - FI