Subcontracting In Sap 6q4fr

Subcontracting In SAP & ing Entries Subcontracting is a very common Scenario in today's manufacturing industry. Many business involve in manufacturing get many components and material produced by sub-contractors in order to produce and deliver fine finish goods on time as ordered by customers. (There are many threads and sources that help you to learn theoretical aspects on subcontracting in real world and SAP. Therefore refer them for theoretical understanding). In

this

blog

I'm

few subcontracting

just

illustrating

Examples

scenarios and general

with

you its

configuration. (In

the subcontracting posting this

blog

entries I

do

process and

under not

different

discuss

about

subcontracting with chargeable components). Let’s start from Subcontracting Process ….. :) Process of Subcontracting 

Create Info Record – ME11 – An Info Record must have been created for the

material reference to subcontracting 

Create Purchase Order – ME21N – With Item category ‘L’.



Good issuance to subcontractor i.e. Transfer Posting – MB1B – Transfer the

components from your storage location to the subcontractor using the movement type – 541 (at this point no ing entry will be posted. only the stock transfer will take place from current storage location to subcontracting vender) 

Goods Receipt – MIGO – receive the end product (and components) to Stock,

movement types – 101 for main material(end Product) and 543 for components 

Subsequent Settlement if any– MB04 – Subsequent adjustment of components

other than the entries in GR(above 4) 

Invoice verification – MIRO – Similar to normal invoice verification

If you are intending to implement subcontracting process comprehensively in your organization make sure you have maintained all master data requirements

related

to

subcontracting. For

example,

Procurement

Type

(External Procurement/Both), Special Procurement key (30) in addition to the Info

records, BOM explosion field should blank etc. Other data are similar to the rest of the SFG/FG materials according to the nature of your subcontracting requirement and valuation levels. Note: Even without the aforesaid parameters you can execute the subcontracting transactions but as mentioned it is not comprehensive and not correct as per standard process which will cause errors for examples in standard costing run and therefore the standard price of such material will be incorrect. Let's take some simple example so that it will be easy for you to understand. E.g.: 1 Material XYZ is sent to sub-contracting vender Tea-times (Z500) by High-times (1000 -CC) for further processing. Note: Cost of Sub-contracting end product (SFG/FG) will consist of its component Cost which is sent for subcontracting and Sub contractors Price (external service cost). According to the above problem below are the component of sub-contracting product i.e. FAB01 – (SFG sent to subcontractor) Sub- contracting Cost (External Service Cost) To produce 10 PAA of XYZ Material below quantity of component (Items) required FAB01 - 10Kg Subcontracting cost $10($1 per PAA) Standard Cost The standard cost itemization can be shown as below. Scenario 01 - Posting Schema for Standard Price Control Without Price Differences 1.

Goods issue –no entries posted

2.

Goods received - At good received below entries will be posted(refer E.g. 01)

Scenario 02 - Posting Schema for Standard Price Control With Price Differences (Price change in Invoice) Company receives an invoice with value $15, i.e. at each PAA $1.5 s postings are similar till GR as in scenario 01. Only in Invoice verification the price difference would arise.

Scenario 03 - Posting Schema for Standard Price Control With Price Differences (Price Change at PO) Below will be the Posting entries. Goods Receipt –

Subcontracting Configuration –

In of configuration there are few. 1. Out of this automatic determination in OBYC is important. It is mentioned below. 

External Service cost (Sub-Contracting Cost) – Transaction FRL – Sub contracting Service Cost (P&L) a/c should be maintained with reference to the



valuation class. Sub-contracting



Transaction BSV - Change in stock Consumption for subcontracting – Transaction

inventory

Change

a/c

determination – GBB with

General

Modification VBO with relevant valuation classes and GL a/c And apart from that the other genera configuration mention below  

GR/IR Clearing Determination – Transaction WRX – GRIR Clearing a/c Stock A/c determination – Transaction BSX (Inventory posting) with Stock GL s

–

2.

Automatic a/c assignment has to be done as well for the P&L s such as

External Cost, Inventory change a/c and consumption a/c. It is common that one Cost center is assigned for these P&L a/c so end of the day the cost center will always show a ZERO balance. 3. In CO

separate cost component

with

origin

group can be created

for

subcontracting in OKTZ. So that the sub-contracting cost can be separately shown within cost component reports. 4.

In line with Cost component you can assign a separate Value field in COPA for

subcontracting. So all report will be in same line.