Transcript
PROCURE TO PAY
Procure to Pay
Procurement
1. DETERMINATIONOF REQUIREMENTS
2. SOURCE DETERMINATION
4. POPROCESSING
6. GOODSRECEIPT
8. INVOICEVERIFICATION
9. PAYMENT
5. ORDERMONITORING
3. VENDOR SELECTION
Accounts Payable Originates from the Purchase-to-Pay Cycle
Purchase Req
Purchase Order
Goods Receipt
Invoice Verification
Accounts Payable
Payment
Based on specific request or MRP run
Released to suppliers
Dr. Inventory/Asset XX Cr. GR-IR Clearing Account XX
Dr. GRIR Clearing Account XX Cr. Accounts Payable-Vendor XX
Payment Run
Dr. Accounts Payable-Vendor XX Cr. Cash In Bank XX
Determination of Requirements
Creation of Purchase Requisition (Manual or MRP)
History of changes in Purchase Requisition (Change Log) item
Purchase Requisition status
Release (Approval) Strategy
Request for Quotation (RFQ)
Reference technique in RFQ creation
Price comparison of the quotations
Source Determination and Vendor Selection
Purchase Order Processing and Monitoring
Reference technique in PO creation
Pricing Condition History of changes in Purchase Order
(Change Log) header/item Purchase Order status
Release (Approval) Strategy
Tolerance limit set-up
Goods Receipt with reference to PO
Material document and Accounting document creation after posting
Resulting to: Inventory update Update of G/L accounts Updates in the Purchase Order Update in Material cost (Moving
Average Price)
Goods Receipt
SAP Three-Step Verification
Logistics Invoice Verification
Creates Accounting Document for referencing
Provides 3-way matching (Purchase Order against Goods Receipt and the Vendor Invoice)
It allows credit memos to be processed, either as invoice reversals or return deliveries.
Payments (A/P)
Dual control of master record Simultaneous updating of subsidiary ledger and
general ledger (minimize reconciliation activities) Instant access to details of account balances per
Vendor Drill down facility down to the original document Full audit trail Manual or automatic processing of payment
transactions Check information on payment transactions
Logistics Invoice Verification
Creates Accounting Document for referencing
Provides 3-way matching (Purchase Order against Goods Receipt and the Vendor Invoice)
It allows credit memos to be processed, either as invoice reversals or return deliveries.
•Released •invoice
•1000 •Payment•program
•Payment•program
•Bank
•1000
•Vendor
•Vendor •invoice •?
•Purchase•Order
•10
•20
•30•Invoice
•verification
•Invoice •verification
•Blocked•invoice
PaymentsPayments
Back to Procurement Process
Payments (A/P)
Dual control of master record Simultaneous updating of subsidiary ledger and
general ledger (minimize reconciliation activities) Instant access to details of account balances per
Vendor Drill down facility down to the original document Full audit trail Manual or automatic processing of payment
transactions Check information on payment transactions
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