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    Consingment Process2

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    RP Tech
    The document describes the vendor consignment process in SAP, where a vendor stores materials at a company's premises but retains ownership until materials are transferred. Key points are: materials remain in vendor's liability until transferred; no accounting entry occurs during goods receipt from vendor; transfer posting generates an entry moving materials from vendor to company stock. The process involves creating a consignment record, purchase order, goods receipt, transfer posting to generate an entry, invoice settlement using MRKO, and payment to the vendor.

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    Consingment Process2

    Uploaded by

    RP Tech
    44 views8 pages
    The document describes the vendor consignment process in SAP, where a vendor stores materials at a company's premises but retains ownership until materials are transferred. Key points are: materials remain in vendor's liability until transferred; no accounting entry occurs during goods receipt from vendor; transfer posting generates an entry moving materials from vendor to company stock. The process involves creating a consignment record, purchase order, goods receipt, transfer posting to generate an entry, invoice settlement using MRKO, and payment to the vendor.

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    The document describes the vendor consignment process in SAP, where a vendor stores materials at a company's premises but retains ownership until materials are transferred. Key points are: materials remain in vendor's liability until transferred; no accounting entry occurs during goods receipt from vendor; transfer posting generates an entry moving materials from vendor to company stock. The process involves creating a consignment record, purchase order, goods receipt, transfer posting to generate an entry, invoice settlement using MRKO, and payment to the vendor.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    44 views8 pages

    Consingment Process2

    Uploaded by

    RP Tech
    The document describes the vendor consignment process in SAP, where a vendor stores materials at a company's premises but retains ownership until materials are transferred. Key points are: materials remain in vendor's liability until transferred; no accounting entry occurs during goods receipt from vendor; transfer posting generates an entry moving materials from vendor to company stock. The process involves creating a consignment record, purchase order, goods receipt, transfer posting to generate an entry, invoice settlement using MRKO, and payment to the vendor.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    CONSIGNMENT PROCESS

    Vendor consignment is a special procurement process where the vendor stores his material in the
    company/buyer's premises with his own ownership of that material.
    Material remains in the liability of the vendor until it is withdrawn from consignment stock. This stock
    remains on the vendor's hand until it gets transferred by transfer posting. The vendor raises the invoice only
    after stock transferred into company stock.

    Points to remember during vendor consignment:


    Ownership and liability of material in the hands of the vendor.
    Purchasing info record should be maintained for material with the vendor.
    No accounting entry hit during Goods receipt of consignment purchase order.
    Stock shows in vendor consignment stock after goods receipt.
    Accounting entry hit only after stock transferred into company stock.
    Goods receipt happens at the price mentioned in purchase info record.
    Here MRKO is used for payment settlement as we need to split invoice. Where as in MIRO we need
    to do full invoice.

    Configuration Steps:
    1) Create Consignment Info Record (ME11)
    2) Create Consignment PO (ME21N)
    3) Post goods receipt of consignment PO (MIGO)
    4) Transfer consignment stock to your own stock ( Transfer Posting or MB1B)
    5) Vendor payment settlement (MRKO)
    6) Payment to vendor (F-53)

    CONSIGNMENT PROCESS WITH EXAMPLE


    Let us consider material 60579 and Vendor 7000000427.

    1. Create Purchase Info Record (ME11):


    Enter material, vendor, purchasing organization, plant details and click on consignment.

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    Enter the Tax Code

    2. Create PO (ME21N K for consignment

    No Condition Tab at Item Level

    Note:
    As soon as you enter Item Category as K, condition tab will disappear at item level.

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    3. Goods Receipt (MIGO):

    Note:
    101 K
    NO accounting entry as stock will be under vendor consignment
    Vendor has sent the goods as per the PO and we have done the GR. Now the goods will be
    under company premise but it will be owned by the vendor.

    After GR go to MMBE, you will observe the stock under vendor consignment.

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    4. Transfer Posting: ( Transfer Posting or MB1B):
    When the company needs certain quantity from this stock, we do the transfer posting and move
    the stock from vendor consignment to our stock.

    Note:
    During transfer posting 411 K
    Accounting entry will be generated.

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    Now go to MMBE, you will observe that quantity mentioned above has moved from vendor
    consignment to our stock.

    5. Invoice Settlement (MRKO):


    We need to pay the vendor for the quantity we have used or in other words, settle the liabilities
    that our company has for the vendor. For this we need post the invoice using MRKO.

    Here accounting entry will be generated

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    Accounting Entries during normal consignment process:

    Transfer Posting Invoice Posting (MRKO) Vendor Payment


    BSX + (Inventory Posting) KON + (Consignment Payables) KBS + (Vendor Payment)
    KON - (Consignment Payables) KBS - (Vendor Payment) Credit (Company Account)

    SCENARIOS IN CONSIGNMENT
    A. Consumption of stock from storage location to cost center (maybe for production)
    Goods issue is carried out with movement type 201.
    Enter cost center

    Here accounting entry will be generated. GBB with account modifier VBR is generated.

    Now if we go to MMBE, we will observe that 40 quantity has been reduced from our stock.

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    B. Consumption of certain quantity of stock directly from vendor consignment to cost center
    Goods issue is carried out with movement type 201 K.
    Enter cost center

    Here accounting entry will be generated. GBB with account modifier VBR is generated.

    Now if we go to MMBE, we will observe that 30 quantity has been reduced from vendor consignment.

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    Invoice Settlement (MRKO) has to carried out as we have to pay the vendor for the quantity we have used.

    Here accounting entry will be generated.

    C. Return excess stock in vendor consignment back to vendor

    Enter the GR document details and reason for movement

    GR Document

    No accounting entry will be generated.


    Now if we go to MMBE, we will observe that quantity in vendor consignment will be 0.

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