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Budgeting issue in MM

atif_farooq
Active Contributor
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Hi:

At client side material procurement is being done two basis .

1..Store purchases inventory for overall Company and it is not subject to budget check. Budget check will happen at the time goods are issued to departments.

2..But when the same material is requisitioned by a department and is routed to Procurement department for purchase , client want budget check & its commitment on PR & PO. Now my concern is it not possible to do because once valuation class of that material is made budgetable it will not be possible to make budget it with second scenario as mentioned. Please guide me.

Regards

12 REPLIES 12

iklovski
Active Contributor
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Hi Atif,

Think about working with MM reservations, which could be eventually transferred in commitments in FM.

Regards,

Eli

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Hi Eli:

Material reservations involves materials . In second case say a department generates PR and then reservation , how will it be budgeted since the materials it is having have non budgetable commitment item as done to handle first case. In second case i foresee another issue , unlike first case we will not want budget check at the time of issuance of stock to department. Now how will this be catered. What should be ideal solution for above scenario.

Regards

iklovski
Active Contributor
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I cannot get you. You wan tthe budget to be checked only on the issue or also in some cases when your purchase to stock? If the first is correct, then I see no problem. If the second is correct, then you should be able to distinguish between the cases where the budget is checked and where it's not: depending on this info, you could deviate the FM document to commitment item which is relevant for budget check or not.

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Hi Eli:

Look there are two different scenarios. Material is same in both cases.

Scenario 1: Procurement department centrally procure budget for all departments and issue them time to time as per their demand. In this particular scenario, client does not want Budget check on PR/PO level, instead budget should be checked at the time goods are issued to department. For meeting this will not be creating stock commitment items with 30/3 , instead consumption account's commitment items will be created with 30/3 and respective department's fund center will be linked to it for  posting budget and actual utilization.

Scenario 2 : Here department raises PR in case of stock outage or any other requirement. Now client want the budget check on PR/PO level not on issuance of stock for this case. It means that relevant department's budget should be consumed as soon as it raises PR and procurement makes it PO..Now my question is for this second case. When i have made all stock commitment items non budgetable then how budget check will be triggered for scenario 2 at PR/PO level ?

I hope you get my point.

Regards

iklovski
Active Contributor
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Hi Atif,

So, the question is whether you can distinguish between 'general' purchase which is done by procurement department and the ones raised by other departments for their proper usage. Of course, this distinction should be available in the time of creation of FM document. Check all available fields of FM derive, e.g. movement type, inventory posting, etc. and see if one of them could be used for this purpose. If not, you can consider enhancing FMDERIVE structure with BADI.

Regards,


Eli

Former Member
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In your second scenario, is department requested material going to be stored in the same plant and storage location?

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Hi:

The material requested by department itself shall first go to the main storage location and then from where it will be issued to department. Client have only one plant.

Regards

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So, what is the way to tell the system that a purchase is requested by a department, using Purchasing Org, or Purchasing Group or something else?

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Why don't they create PO with goods issue (201)?

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Hi Eli:

I never tried this. Can you please share some thoughts about it.

Ming:

Yes of-course purchasing groups are different. When procurement department does purchasing of material it will always use P001. However when departments raise requisitions for purchasing, each of them have their own purchasing group so i want budget check when department raises PR/PO not at the time of centralized procurement as stated in first post. Please guide me.

Regards

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Well... PO with good issue is a standard logistic process. I have seen it in many projects and scenario described by you will be suitable for handling by this procedure.

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Hi Eli:

Thanks i will check it with MM guy and will revert back.

Regards