TRAINING PROGRAMME

ON
LOGISTIC MODULE

21st Sep 2015

Corporate Office - Information Systems Department

Session - II

LOGISTICS

PURCHASE CYCLE

Corporate Office - Information Systems Department

MM - OVERVIEW

Material Requirements
Stocks Re-order point planning
Planning

Requirement

Production Purchasing
(Internal Procurement) (External Procurement)

Vendor Invoice

Invoice
Goods Receipt
Verification

Goods Transfer
Issue Posting

Accounting
Accounting
Sales and Distribution

Corporate Office - Information Systems Department

MM - PURCHASE CYCLE
Payment
PM/ PS
Invoice
Invoice
Requirement
Verification

Delivery Goods / Service

Receipt RFQ

PO

PO / call-up
Contract
Created

Corporate Office - Information Systems Department

PURCHASE CYCLE - Imp. T codes

Purchase Requisition ME51N

Request for Quotation ME41
Maintain Quotation ME47
Comparative Statement YMR166
Contract ME31K
Call ups / PO ME21N
Goods Receipt MIGO
Goods Issue MIGO
 PURCHASE REQUISITION - ME51N/52N/53N

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 PURCHASE REQUISITION ACC. ASSIGN CATEG

USED FREQUENTLY

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 PURCHASE REQUISITION IMPORTANT FIELDS

Item Category

Account Assignment
Category

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 Purchase Requisition imp. Elements, services

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 Purchase Requisition SERV PR

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 Purchase Requisition - Release Strategy I

Release Groups
Each department code is made as Release Group
Release Code
Levels - IN / HD / DG / FC / GE
IN Initiator
HD HOD
DG DGM
FC Finance Concurrence
GE GM / ED
 Purchase Requisition - Release Strategy - II

Strategy 1 (For Manual PRs)

Each Amount level corresponds to a Strategy

L1 up to 50000 IN HD

L2 50001 500000 IN HD DG

L3 500001-2500000 IN HD DG* GM

L4 > 2500000 IN HD DG* FC GM

* Optional
 Purchase Requisition - Release Strategy - III
Strategy 2 (For MRP PRs)

There is only one Strategy for MRP PRs .

All PRs are to be released by Initiator & HOD
irrespective of value of PR.

Deptt PR creation Ind Release Code

IC B (MRP) IN HD
 Purchase Requisition - RELEASE PROCEDURE

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 RFQ HEADER DATA

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 RFQ - ITEM DATA

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 RFQ MAINTAINING QUOTATION MEK1

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RFQ Maintaining Quotation
RFQ - QUOTATION COMMENTS FOR STATUS
SGL Negotiated LTE
SGP Negotiated PT NQA Regret -All items
SLE Lowest Emergency , NQI Regret -item
SLL Lowest LTE NRS No Response from Vendor
SLP Lowest PT ORQ Original Quote Superceded
SLY Lowest Proprietary LTE PAC Tech. Acc., Price Accepted
SNE Other than Lowest Emergency, PNC Tech.Acc.Price not competitive

SNL Other than Lowest LTE REG Vendor response with regret
SNP Other than Lowest PT TA Technically acceptable
SNY Other than Lowest Proprietary TNA Technically not acceptable
TRF Vendor forwarded RFQ to other
SOE Overall Lowest Emergency,

SOL Overall Lowest LTE

SOP Overall Lowest PT
SOY Overall Lowest Proprietary LTE

SSE Emergency ST
SSL Single Acceptable LTE
SSP Single Acceptable PT
 PURCHASE ORDER

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PURCHASE ORDER SCENARIOS - I
There are different forms of Purchasing :
Purchasing Material for Stock i.e. Piping items, Bearings,
Equipment spares etc.
Purchasing of Subcontracting nature i.e. Fabrication of
Bitumen Drums etc.
Purchasing Material for Direct Consumption i.e. small value
purchases at locations/ Units
Capital material Purchasing i.e. Procurement for projects,
Assets.
Purchasing of Services i.e. AMCs, Service against SOR etc.

Corporate Office - Information Systems Department

PURCHASE ORDER SCENARIOS - II

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 PURCHASE ORDER ME21N/ME22N/ME23N

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 Purchase Order Types

Normal purchase order

Contract based purchase order

STO

Import purchase order

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 Purchase Order - Navigation

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 Purchase Order - Components

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Purchase Order Mandatory Fields
Error Message : Pl Put collective number PO header.

Collective Number made Mandatory in PO

Solution : Go to header Additional Data Collective number &

Put Tender number in collective number field.
 Purchase Order TAX CODE - I

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 Purchase Order TAX CODE - II

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 STOCK TRANSFER - SPL.TYPE OF PO-I

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 SUB CONTRACTING P.O - SPL.TYPE OF P.O-II

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Purchase cycle (Import)

Create Import PO
Capture Bill of Entry
Capturing Excise Invoice
Goods receipt
Post Cenvat
MIRO
 PURCHASE ORDER IMPORT CYCLE

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 Integration with FI- Purchasing
Account assignment
Account assignment :

Blank => Standard Purchase of Material for Stocking in Inventory

Q => Project purchase for receipt as project stock
N => Project purchase for direct charge off items
K => Purchase where the cost is directly charged off to a cost
center (Revenue expense). Hence there is no Stock in
Inventory.
F => Purchase where the cost is directly charged off to an
Order ( PM order - Revenue or Internal order capital ).
Tax code
Tax code
This assigns value to Excise duty, Sales tax/ VAT / service tax and also
determines whether material / service is CENVATable

Corporate Office - Information Systems Department

Centrally Agreed Contract
Contract
Purchase
NHVT
Organization

Plant

Release Release Release

Order (PO) Order (PO) Order(PO)
Purch. Purch. Purch.
Org. NHVT Org. NHVT Org. NHVT
Plant 1121 Plant 4136 Plant 3136

Corporate Office - Information Systems Department

 OVERVIEW OF CONTRACTS

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 CONTRACTS QTY AND VALUE TYPE

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Online PR/ PO/ Contracts Release
Type of Transaction Code Steps Remarks
Document

Purchase ME54 (individual) Put PR Number Release Codes are

Requisition ME55(Collective) Put Release Code IN Initiator, HD HOD
Enter DGDGM, GM GM, ED
o Click Release & save FC-Financial Concurrence

Purchase ME28 Put release code as PI Release Codes are

Order Put PO no in Doc no field PA to PF Officers in
Execute Grade A to Grade F
Click release & save PF Finance Concurrence
Repeat above as approver

Contract ME35K Same as PO release Same as PO release

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 GOODS RECEIPT

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 GOODS RECEIPTS MOVEMENT TYPES

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 GOODS RECEIPT - AGAINST PURCHASE ORDERS

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 INVOICE VERIFICATION W.R.T. PURCHASE ORDER

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 INVOICE Completion of Procurement Process

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 PUBLIC PROCUREMENT POLICY

The policy on Public Procurement from SMEs

has been notified by the Central Government.
The policy covers mandatory procurement of
items from SMEs with setting up of annual
goals with the objective of achieving an overall
procurement of minimum of 20% of total annual
purchases within 3 years period and purchase
preference to the SMEs

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 PUBLIC PROCUREMENT POLICY
In the system, 2 categories of vendors for
subject purpose as below are created in SAP
a. SMEG Small & Micro Enterprises General
b. SMER Small & Micro Enterprises Reserved
Authorized user will update Vendor master
table to maintain appropriate vendor category
along with validity dates (from-to). Creation
shall be with 2 level check i.e. forwarder and
approver and audit trail shall be available for
master data.

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 PUBLIC PROCUREMENT POLICY
It is proposed that the approver is of level not
below DGM
As vendor category is maintained at client
level, it will therefore be applicable to all plants
of IndianOil at the time of doing transactions.
Based on the certificate furnished by the
vendor at the time of bidding, user will select
the appropriate category from the drop-down
while creating the RFQ/PO.

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 PUBLIC PROCUREMENT POLICY

In case the appropriate category of vendor is

not maintained in the master, an error message
will be prompted to the user

This will prompt user to maintain the vendor

category in the master table.

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 MASTER DATA - YMVC

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 CREATING RFQ

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 VENDOR CATEGORY- QUOTATION

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 CREATING CONTRACT

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 CREATING PO

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 CREATING P.O Changing Category

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 CREATING P.O Order Status

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 REPORT YMR194

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 THANK YOU

Corporate Office - Information Systems Department