Describe the item types of an SRM (local) Purchase Order, especially the limit item
- Item type definitions
- Material type
- Service type
- Limit type
Item type definitions:
- Material type (Item type field – 01)
- Service type (Item type field – 02)
- Limit type (Item type filed – LIMI)
You purchase a certain type of material for your company for daily usage or for your production stock (direct material).
The material with the daily usage is mostly accounted for the relevant cost center. To take an example, the new employee of SAP needs a notebook for daily usage. This notebook will be ordered and accounted for the cost center of the relevant department \ organizational unit.
The direct material – as its name anticipates – is directly used in the production process of the company. A car manufacturer for example needs screws for assembling new vehicles. The screws are purchased as direct material and go directly for production stock in order to be available in the factory.
You request a service from a service agent. Let’s take the previous example. As a car manufacturer you need a shipping company do deliver your products to the stores, so you purchase a shipping service from this company.
You can process in an SRM PO the value limit (maximum purchase order value that goods or services must not exceed) and the expected value (estimated value of the purchaser, either under or the same as the value limit). The expected value serves to update the commitment in controlling and the budget is reduced by this amount.
You can also spread the value limit over partial limits (contract limits and remaining limits) or establish an undefined value limit. The sum of the contract limits created may be greater than the value limit. The system checks and ensures that the value of the ordered items is not greater than the value limit.
You can assign the relevant product category and define the period in which the goods should be delivered or the service performed.
If you do not specify a value limit or a remaining limit, the system designates the remaining limit by default as unlimited.
To understand the basic concept of a limit item, let’s have a look at another example. We need a regular service, so we wouldn't like to create every time the service is fulfilled a new purchase order. Instead of that we create only one and every time the service is delivered, the invoice from our business partner is attached to this purchase order.
In the basic data of the limit item, you have to specify the required period, value limit and expected value.
The amount of the expected value is used for the approval workflow. You can enter the account assignment, the confirmation expected indicator or the invoice indicator, unless the follow-on documents are to be created in the ERP system.
Note: Limit items may be combined with planned items, such as material, free text or service items
If the confirmation is expected in the Related Documents tab, a service Limit PO with Item category D is created in the ECC system. If no confirmation is expected, a blanket PO with item category B is created in the back-end system.