Are your purchase orders ordered in the best way?

Part IV of the series: “Automated Audit of the Configuration and Authorizations in SAP MM”

Today’s blog post presents you with three audit procedures for purchase orders in purchase to pay.

1. Is everything well organized? Auditing organizational structures in SAP MM
2. Proper protection of vendor master data
3. The procedure for checking the approval process for purchase requisitions
4. Are your purchase orders ordered in the best way?
5. Everything under control for critical goods movements
6. How to protect your invoice verification
7. Clear interrelationships when recording the physical inventory
8. Customizing in SAP MM set at the test bench
9. Segregation of duties in “purchase to pay”
10. Good practices in relation to the segregation of duties between “purchase to pay” and “financial accounting”

Tolerance limits for price variances in purchase orders

When processing purchase orders, the system checks whether tolerance limits for price variances (PE tolerance key) have been set. That is, the effective prices of a purchase order item (the price in which all of the existing conditions have been factored in) is compared with the valuation price stored in the material master. This is intended on the one hand as a control for avoiding entering estimated prices and on the other hand to try to keep the valuation of the materials consistent.

SAP Authorizations for maintaining purchase orders

A purchase order is a legally effective declaration of intention. The purchase order is used to make an agreement with a vendor for providing the goods or services described in the purchase order with the specified conditions. Document types and purchasing groups can be used to individually authorize which purchasers are responsible for which purchase orders. The maintenance of purchase orders is a sensitive authorization. It should be assigned only to responsible employees from Purchasing with a restriction of the authorization to the buyer, purchasing organization, plant and document type. A downstream approval procedure should be implemented.

Approval of SAP purchase orders

The approval of purchasing documents (purchase orders, contracts, delivery schedules, requests for quotation and service entry sheets) is the process in which the accuracy of the document data is checked and approved before being handed over to the vendor. The aim of this approval procedure is to replace manual written authorization procedures using signatures with electronic ones. Each purchasing document is checked for the relevant conditions. If the conditions are met, a release strategy is automatically assigned to the document. To define the release strategy, release groups are created, to which release codes can then be assigned. A release strategy can contain up to 8 release levels.

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