The Associated Cement Companies Limited

Purchase Order
PO06– Special Procurement

ACC Mumbai, 11 JULY 2006

Rsubramania.sarma@acccement.com

Classified: INTERNAL USE ONLY Not to be quoted or reproduced without written permission
 Agenda
 Objectives
 Introduction and Concept
 Consignment Stock Process
 Goods Receipt for Consignment
 Goods Issue for Consignment
 Settlement Consignment Stock
 Concept of Rebate Agreement
 System Walkthrough
 Question & Answer

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The Associated Cement Companies Ltd 24.09.20/TRG
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 Objectives

 To understand the Consignment Stock

management within Materials Management

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The Associated Cement Companies Ltd 24.09.20/TRG
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 Introduction and Concept

 Consignment material is material made available by a

vendor at your site. The vendor retains ownership until
you:

 issue the material from consignment or

 transfer it into your own stock.

 Vendors’ consignment stock is managed separately

from your own stock, under the vendor’s name, until
withdrawal or transfer into your own stock.

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The Associated Cement Companies Ltd 24.09.20/TRG
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 Your own material and consignment material is
managed under the same material number.
 The invoice is due at the set period of time
(When goods are issued). Furthermore, the
enterprise can also arrange with the vendor to
take over the full ownership of the remaining
consignment materials after a certain periods of
time.

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The Associated Cement Companies Ltd 24.09.20/TRG
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 Consignment Stock Process

Create Do goods
Create material, consignment receipt of
vendor info record consignment
(price) stock

Do goods issue
Settle
Process from
consignment
Payment (FI) consignment
liability
stock

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The Associated Cement Companies Ltd 24.09.20/TRG
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 Goods Receipt for Consignment

 After posting a goods receipt into consignment

stock:
 The value of the stock does not change (material still
owned by the vendor).
 The quantity of stock available for MRP increases

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The Associated Cement Companies Ltd 24.09.20/TRG
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 Goods Issue from Consignment

 A goods issue from consignment stock results in

the following updates:
 Consignment stock is decreased
 The issue is valuated using the relevant vendor’s price
for this material (via consignment info record).
 As a result of the issue, a liability is incurred toward
the vendor

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The Associated Cement Companies Ltd 24.09.20/TRG
Classified: INTERNAL USE ONLY Module Not to be quoted or reproduced without written permission
 Settlement Consignment Stock
 On a periodic basis the goods issues are
settled. An invoice document is generated with
the debit posting made to the G/L account,
“Consignment Liabilities.” This is the same
account to where the credit posting for the
goods issues of consignment stock was made
1 Goods Issue 2 Settlement

Consumption or Vendor
Vendor
Owned Stock Account Consignment
Account
Liabilities
1 2 1 2

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 System Walkthrough

 Maintain consignment price

 Consignment stock report can be
generated as and when required(MB54)

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 Q&A

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The Associated Cement Companies Ltd 24.09.20/TRG
Classified: INTERNAL USE ONLY Module Not to be quoted or reproduced without written permission
 We…

Know the way, show the way, go the way

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The Associated Cement Companies Ltd 24.09.20/TRG
Classified: INTERNAL USE ONLY Module Not to be quoted or reproduced without written permission