HI5001 (BM1) In-Depth Analysis of Procurement and Fulfillment Processes Using SAP S/4HANA Unit Title: Accounting for Business Decision
In-Depth Analysis of Procurement and Fulfillment Processes Using SAP S/4HANA
1. Introduction
As we have seen today’s business environment is highly competitive and companies are Interconnected globally that is why they are adopting Convergent ERP applications like SAP S/4HANA for Running their business operations and Financial Control. SAP S/4HANA is the new generation ERP solution that helps organisations to streamline their operations by connecting different sectors like procurement, sales and operations planning, and financial accounting that enables the systems to process large amounts of data in real time to support decision-making.
This document evaluates processes in the procurement and fulfilment sub-modules in SAP S/4HANA particularly from a financial perspective and measurement of control effectiveness. The procurement process enables an organisation to obtain the necessary products from the suppliers and the inventory management process, while the fulfilment process includes the selling process right from the receiving the customer enquiries to getting the payments and delivering the products. By studying such processes, one can get an idea of how the SAP S/4HANA helps to integrate various organizational modules, strengthen internal control, and optimize organizational performance.
2. The structure of the procurement process in SAP S/4HANA
The Structure of the Procurement Process in SAP S/4HANA and its Detailed Analysis
Objective: Purchasing bid/deluxe touring bikes black’ to enable a coherent analysis of the financial and operational implications of procuring Deluxe Touring Bikes (Black) from the vendor Olympic Protective Gear.
Step 1 of the purchasing process is developing a purchase order.
The procurement process commences with preparing a purchase order(PO) through which a buyer formally asks a seller for the supply of products. This step is important as it provides base for all other transaction that are associated with the purchase.
Transaction Code: ME21N
Data Entry Fields:
Purchasing Organization: BI US (US00)
Vendor: Olympic Protective Gear (101613)
Purchase Group: North America (N00)
Material: Deluxe Touring Bike (Black) (DXTR10613)
Quantity: 4 units
Net Price: $1,400 per unit
Currency: USD
Plant: DC Miami (MI00)
Financial Impact: At this stage, there is no direct monetary exchange between the business and the customers. Nevertheless, the creation of a PO creates a commitment to the system which is stored and affects the company's budgets. This is an indication of a future cash outgo and assists in the management of cash flows and preparations of budget.
Screenshot of Completed Purchase Order Creation:
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