Questions reg Outline Agmt -->Sched Agreement or Contract.

[Former Member]

What determines where a material should be procured for VALUE or Quantity basis by creating a quantity/ value contract?

What is a Scheduling agreement? Any examples with Screen shots Plz. that clearly explains the diff betwn contract and Sched. Agmnts.

Regards,

Steve.

[former_member581212 · Accepted solution]

Scheduling Agreement

A scheduling agreement consists of a number of items, for each of which a procurement type is defined. The following procurement types exist:

Standard

Subcontracting

Consignment

Stock transfer

Delivery of the total quantity of material specified in a scheduling agreement item is spread over a certain period in a delivery schedule, consisting of lines indicating the individual quantities with their corresponding planned delivery dates.

For scheduling agreement items involving subcontracting, you can specify the materials or components to be provided to the subcontractor with respect to each scheduled delivery of the ordered item.

Conditions can apply to the entire scheduling agreement. Conditions at item level apply specifically to the material to be supplied in each case.

Scheduling agreement releases (comprising a header and the actual delivery schedule) are issued to the vendor, instructing the latter to effect deliveries of the relevant material on the dates shown.

Costs can be apportioned among various Controlling objects via the account assignment.

Vendors can issue confirmations to the relevant purchasing organization indicating their compliance or non-compliance with scheduled delivery dates.

If you are using scheduling agreements, you can work with or without release documentation. This is controlled via the document type. Working with such documentation affords the advantage that you can display the valid scheduling agreement releases transmitted to a vendor over a certain period whenever necessary.

Note on the term "release": In MM Purchasing, this term is used A) as a generic term covering various kinds of order document issued against outline agreements (these may be release orders issued against contracts or - as here - scheduling agreement releases, i.e. types of rolling delivery schedule issued against scheduling agreements), and B) in connection with an internal approval or expenditure authorization process for purchasing documents. In both cases, "releasing" can be regarded as equivalent to "giving the green light" to go ahead with a certain action (e.g. to the vendor to deliver a certain quantity of materials, or to Purchasing to create or issue a PO for items requested by a user department).

With release documentation (in the standard system, document type LPA)

The schedule lines in the system have internal character. This means that you can change them in any way you wish. The schedule lines stored in the system are not transmitted to the vendor until you explicitly create a scheduling agreement release (which may take one of two forms: a forecast delivery schedule or a JIT delivery schedule).

The release documentation allows you to display the releases transmitted to a vendor over a certain period in order to establish exactly when you transmitted which information to the vendor.

Without release documentation (in the standard system, document type LP)

The schedule lines immediately have official character, i.e. they are immediately transmitted to the vendor the moment you save them (transmission time-spot 4 for messages). There is no release.

Purchase Order A purchase order consists of a document header and a number of items.

The information shown in the header relates to the entire purchase order For example, the terms of payment and the delivery terms are defined in the header.

A procurement type is defined for each of the document items. The following procurement types exist:

· Standard

· Subcontracting

· Consignment

· Stock transfer

· External service

The total quantity of materials to be delivered or services to be performed that is defined in the purchase order item can be subdivided in the schedule lines into various partial quantities with the relevant delivery dates.

For PO items to be supplied by subcontractors, you can specify the necessary input materials or components that are to be provided to the subcontractor for assembly or processing in respect of each delivery date stipulated.

An item of the procurement type u201Cexternal serviceu201D contains a set of service specifications. Outline levels structure the service specifications and service lines determine the quantity ordered. Value limits are specified instead of service lines for services or work that initially cannot be specified precisely.

If services covered by an already existing contract are released (ordered, or called off against the contract), the PO item can contain a value limit relating to the contract in question.

Conditions

Conditions can apply at various levels:

· to the entire purchase order

· At item level, to the material to be supplied or to the set of service specifications in the case of services

· At service line level for individual services (tasks or activities)

Account Assignment

Costs can be apportioned among various Controlling objects via the account assignment.

Vendor Confirmations

Vendors can issue confirmations to the relevant purchasing organization indicating their compliance or non-compliance with scheduled delivery dates.

PO History

The transactions following on from a purchase order are documented in the PO history on an item-specific basis.

Partner Roles

Instead of the vendor as the order recipient, other business partners can appear in various partner roles (e.g. goods supplier or invoicing party).

Plant

In the purchase order, each item is destined for a certain plant. Each plant belongs to a company code, to which the vendoru2019s (creditoru2019s) invoice is directed.

Texts

You can enter text in a purchase order directly or change texts that are suggested by the system. There are two kinds of text:

· Header texts: apply to the whole document

· Item text: apply only to the relevant item

You define which texts appear in which order on printouts in Customizing for Purchasing. You can enter several header or item texts, which you can identify by your own codes

For Contract to be Value or qty contract depends on the requirement, whether your want the have value or qty limit in your procurement....

Use MK or WK as per your requirement...

These both are not allowed in schedule agreement....

The Difference between both are:

1. MK and WK are not allowed in schedule agreement

2. we further req. is generated for the same material for the same vendor, then can extend the schedule lines, btu in contract you need to create ythe new one...

3. As the doc generated are more, so more chances of misunderstandings....

4. Time saving with schedule lines....

hope it helps..

Regards

Priyanka.P

Edited by: Priyanka Paltanwale on Oct 2, 2008 7:54 AM