on 10-16-2007 2:54 PM
1.What is the purchasing process CYcle?
Hi Madhu,
Determination of requirements: The user department responsible can manually pass a requirement
for materials to the Purchasing department via a purchase requisition. If you have set a MRP
procedure for a material in the material master, the R/3 System automatically generates a purchase
requisition.
n Determination of the source of supply: The R/3 System helps the buyer determine possib le sources
of supply. You can use determination of the source of supply to create requests for quotation (RFQs)
and then enter the quotations. You can also access existing purchase orders and conditions in the
system.
n Vendor selection: The system simplifie s the selection of vendors by making price comparisons
between the various quotations. It automatically sends rejection letters.
n Purchase order processing: The system facilitates data entry by providing entry aids when you are
entering purchase orders.
n Purchase order monitoring: The buyer can monitor the processing status of the purchase order online
at any time and can determine whether goods or an invoice have been received for the relevant
purchase order item. The system also supports reminder procedures.
n Goods receipt: The system compares the goods receipt quantity with the purchase order quantity.
n Invoice verification: Vendor invoices are checked for accuracy of prices and contents.
n Payment processing: Financial Accounting normally deals with vendor payments.
Regards
Raju
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It starts, right from sensing the requirement of a material, either through automatically or otherwise.
You create a Purchase information recordm (PIR)
Get it approved to create a Purchase order, with an approved vendor
Recieve materials
Receive invoice from vendors
Make payment to vendor.
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