June Certification Diet

1.When you activate purchase account posting system, the G/L account determination contains additional accounts namely:
A. Purchase Account
B. PA receipt account
C. PA return account
D. PA offset account

Answer: A, C, D
Three accounts are added to the G/L account determination when purchase account posting system is activated in the system. They are Purchase account; PA return account and PA offset account.
Purchase Account: This is recorded in the journal entry along with the same amount that is recorded for the stock account when an A/P invoice or a goods receipt PO is created.
PA return account: This is recorded in the journal entry along with the same amount that is recorded for the stock account, when a goods return or an A/P credit memo is created.
PA offset account: This account is used to offset the purchase or purchase-return account, thus maintaining journal entries created by balanced purchasing documents
Purchase accounting posting system is activated under Administration > System Initialization > Company Details. Then select the Use Purchase Accounts Posting System indicator in the Basic Initializations tab

2.What are the two possible payment means in a payment wizard run?
A. Cash
B. Check
C. Bank Transfer
D. Credit Card

Answer: B, C
The payment wizard automatically creates payment documents based on open invoices (payables and receivables) in the system. The payment wizard run supports two types of payment means namely Check and Bank Transfer

3.Can a down payment request be changed? True/False

Answer: True
A down payment request is like a draft posting that shows that a payment is expected from a customer. A down payment request can be changed as long as its status is open. The down payment closes the down payment request.

4.You are implementing SAP Business One for a client, what is the minimum number of databases that should be created during the project implementation phase.
A. 1
B. 2
C. 3
D. 4
Answer: C
At least, three databases should be created during the implementation of SAP Business One. They are Demo, Production and Test databases.

5.What are the two types of SDK in SAP Business One?
A. Implementation
B. Development
C. Configuration
D. Testing

Answer: A, B
SDK is an acronym for software development kit. It is a tool used to further enhance the generic SAP Business One system. SDK is provided in two versions in SAP Business One. They are Implementation SDK and Development SDK. The former is used to add individual client requirement like form redesigning which does not necessarily require coding while the latter is used to develop add-ons to interface with SAP Business One.

6. Company XYZ uses continuous stock system, what are the costing methods that XYZ can use to manage its stocks.
A. FIFO
B. LIFO
C. Moving Average
D. Standard Price

Answer: A, C, D
Three valuation methods are available in SAP Business One. They are FIFO, Moving Average and Standard Price. These options are only available if stocks are continuously managed in the system. The system calculates the moving average price by dividing the total value of the stock through the amount in stock. In FIFO, the system stores every goods receipt in a separate layer. When goods issue is posted, the system uses the price of the item from the oldest layer, from the second layer and in that order. For standard price, a static price is specified.

7. Where do you set up G/L account determination in SAP Business One?
A. Administration > Setup > Inventory > Define warehouses
B. Administration > System Initialization > Company Details
C. Administration > Setup > Inventory > Define Item group and choose the Accounting Tab
D. Administration > Setup > Financials > G/L Account Determination

Answer: A, C, D
G/L Account determination can be setup under A, C, D above. It is not set up in Company Details (B). Essentially, G/L Account determination can be set up at the item level, warehouse level and item group level.

8. You are using the print layout functionality in SAP Business One, which field is used to define field labels or headings for the repetitive area.
A. Variable field
B. Calculation field
C. Data field
D. Text field

Answer : D
Text field is used to define labels or headings for the repetitive area. The calculation field is used to perform both defined and predefined calculation. The Data field prints the content of the master data and warehouse data. The variable field is used to print data that is not stored in any table but is calculated by certain procedures.

9. The default roles in SAP Business One Human Resources are
A. Purchasing
B. Sales Employee
C. Technician
D. Manager

Answer: A, B, C
The default role in SAP Business One Human Resources are purchasing, Sales Employee and Technician. Other roles can however be added as the need arises.

10. The three types of production orders in SAP Business One are
A. Standard
B. Special
C. Sales
D. Template
E. Disassembly

Answer: A, B, E
Three types of production orders are available in SAP Business One. They are Standard, Special and Disassembly production orders. The standard production orders are copied from the bill of materials. The special production orders are not necessarily based on the bill of materials. The disassembly production order is used to report the disassembly of a standard production order.
Sales and Template are not production order types but bill of materials types.

Importing Master Data from Microsoft Excel File

Business Requirements

A. You are implementing an SAP Business One system for a client. You have given the client the appropriate import excel templates for the item and business partner master data. The client has returned the spreadsheet with over 10,000 records for both the item and business partner master data after a thorough clean up. Because of the large volume of data involved, you don't want to enter it manually into the system. Furthermore, you want to upload it in the least possible time with minimal or no error at all.

B. You already have your item master/business partner data in the SAP Business One system, however, due to the dynamics of the business, you have to update some fields in the master data, e.g. the prices of item in the item master data.

Business Solution
The SAP Business One import utility can be used. This import tool can be used to add new master data and also update existing master data.The import utility is one of the efficient tools that can be used to upload data from an excel sheet into an SAP Business One system. Essentially, only two types of master data can be imported using this tool. They are the item master data and business partner master data. This functionality can be accessed under
Administration > Data Import/Export > Import Data > Import from Excel



Golden Rules
1. The business partner and item codes must not contain the following characters: ! < > * ? % { } =
2. The Microsoft excel sheet must not contain a title row.
3. The Microsoft excel sheet must not contain a blank row.
4. The Microsoft excel sheet must not be open during import.
5. The Microsoft excel sheet must be saved using the .txt file format - Text file.
6. The number of character in the cells of the Microsoft Excel sheet must be less than or equal to the length of the corresponding field in SAP Business One. It must not be greater.
7. No user must be logged on to the system during the import process in a networked environment.
8. Make sure you back up the company database before import.

The Import Process
1. Follow this path in the company where import is to take place in order to access the import functionality
Administration > Data Import/Export > Data Import > Import from Excel.
2. From the data type to import drop down field, choose the master data to import
3. When the master data type (BP or Item) is chosen, you can then choose the fields you want to import. These fields correspond to the fields in the Microsoft Excel document. E.g. BP Name
4. After choosing the relevant fields and appropriate option, click the OK button
5. A screen then appears that allows you to locate the file to be imported.
6. Choose OPEN
7. The importation starts. This may take several minutes depending on the volume of data involved. The progress of the import process can be tracked on the status bar and interrupted, if need be by clicking the STOP button.

Import Status Report
A system message window is displayed after the import process. This notifies you if the import was successful or not. As a check mechanism, the number of rows imported is also displayed. This is to allow you cross check with the actual row in the excel spreadsheet. It is good practice to save the system message, especially when the import process is unsuccessful. This allows you to know and understand the cause of the failure and make amends.

Common Import Errors
Following are common errors that can be displayed and their solutions.
1. The number of the business partner or the item contains an invalid character.
Solution: Remove any of the following characters from the number of the BP/Item field in the excel sheet. ! < > * ? % { } =

2. Error 47: The Microsoft excel sheet is open
Solution: Close the Microsoft Excel sheet and try again

3. Invalid entry
Solution: Make sure that no field in the excel sheet is greater than the defined field length in the corresponding field in SAP Business One.

At this point, it is important to note that:
1. When the update existing record check box is marked, the system overwrites the prior entry in the corresponding fields. However, it is also important to state that the BP/Item codes cannot be modified. Furthermore, the type of the BP cannot be updated as long as transactions have been made against it.
2. In order to modify the items account (expenses & revenue) previous entry, the Update Accts in Existing Items checkbox is marked.

Garbage In … Garbage Out: An Implementation Pitfall!

Hi Guys! I got home late on Tuesday this week. What’s on your mind? Hmmmm, Kenny (as I’m fondly called) was busy configuring an SAP Business One system or doing some kind of remote support. Nope! I was engrossed in a discussion with my Managing Partner, Deola. The crux of our discourse is why implementation fails. Deola attributed failed implementations to “Data” and he said, Kenny, when you put in garbage into the system, what you get is garbage. I nodded my head in agreement. He gave an example of how a CEO lost confidence in the accuracy of his financial reports as a result of incorrect data loaded into the system barely two weeks after go-live. And you know what? Your guess is as good as mine. The multi-dollar project was thrown into the bin! And the implication is bad referral.

At a very high level, I’m discussing the following tasks as it relates to data management during project implementation: Data Definition, Data Collection, Data Clean up, Data Analysis, Data Testing, Data Re-engineering and Data Migration.

Data Definition: The first thing to do is to have a clear-cut idea of the data needed for the system to work. These data forms the bedrock of the master data. This is important so that right from the start, you know what data you are looking at. This is also an eye opener into the size of the data you are expecting to get. Furthermore, a proper definition of data needed can serve as a guide when planning for your hardware, especially the server and backup tools.

Data Collection: Identification of the people to meet for the required data is important. You must be ready to put them on their toes. This can be a daunting task, especially if the company you are implementing for is coming from a non-system environment. It is even possible that the data needed are not readily available or difficult to extract. Hence, the need to do some forms of “pushing”. The data collected could be in hard copy or soft copy or even both.

Data clean up: This is where the bulk of the job is. Cleaning data can be challenging. This involves filtering i.e. separating the shaft from the wheat. In most cases, the data that you get irrespective of your definition contains lots of junks. It’s important that these data be filtered, so as to identify the ones you need and the ones you don’t need.

Data Analysis: It’s important to analyze the data collected, especially when batch loading will be carried out. It is at this stage that coding (material no, business partner no and employee ID) and grouping (item group, customer group) conventions are carried out. This has to align with the supported templates provided (something like the data migration templates in SAP Business One). The customer should be guided in choosing and adopting a naming convention. At this stage, it is important to ensure that all mandatory (primary) fields are filled. As much as possible, ensure that no fields are left blank in your template.

Data Testing: It is also important to test the data before go-live. Test database can be created to simulate what the live system will look like. During training, the test/training database should be used to test all possible business scenarios. Task oriented testing and process (integration) testing should be carried out. Ensure you stretch the limit of the testing. If possible, exceed the elastic limit!

Data Re-engineering: After data testing, as it is expected, updates need to be made to the data. This may require “throwing out” and “bringing in” data. This can be done in parallel as the need arises or after the full testing.

Data Migration: Final migration of data to the live system should only be done after the data has been thoroughly tested. It is pertinent to note that, before final data migration, both the consultant and the client must sign off.

Thus, we can say that, data is an important determinant of whether a project will succeed or not. Right from data definition to collection and then to final data migration, lots of work has to be done to ensure that the right data are loaded into the system. Each state of data management is important as the others. This is because the output of a stage is the input to another stage.

A Chat with the CEO: Yves Néron of IDIT Corp, Canada.

Yves Néron is the President of IDIT Corp. IDIT Corp is a SAP Business One reseller based in Canada. Join me as we explore the world of the gentle man that paddles the affairs of this dynamic company. Enjoy!


Yves Néron

1.Tell us about yourself

I have started in IT 24 years ago. At that time pc were not in offices yet.I was learning IT the rough way, punch cards, Cobol, mainframe, timesharingto compile programs, green screens.I got out of school with a college diploma and almost no chance to find ajob. In 1982, interest rate went up to the roof at 20% per year. There wasno employment anywhere. It took me almost a year to find a job ofprogramming on CP-M and Basic at minimum wage.I worked later in large corporation, then in IT consulting, up to the time Irealized, my IT skills were good but not my business knowledge.I did a Business Admin bacc. To complete my business knowledge. I believe Iam a proper mix of IT and business. The time is over for techies in ITmanagement. Companies need guys that can align the IT with the businessneeds, not the opposite.We know see real business managers driving IT dept and giving back theproper tools to companies that demands more and more information.

2.Tell us about your company

All through the years, I always had been an entrepreneur. When young I hadmy business of painting and renovating. Later I started a small business ofprogramming. Not making enough money, I decided to try working for somebodyelse as a programmer. I did great at it, I am a team player and I align mypersonal objectives with the business goals, so working under someone elseis not a big issue.I ended up as an IT director at IDfoods around 1995. This company wasflying, sales were up every year. People were opening their taste toanything good coming from all over the world, and IDFoods was delivering itto them.Surprisingly, many business partners of IDFoods (vendors, customers) werenot really IT equipped to play in this industry.We started offering our IT knowledge and services. Again, the soul ofentrepreneurship was taking over. Not to mention the king of entrepreneur,the IDFoods owner itself !Slowly but surely our small IT shop was acquiring customers in manydifferent industry, even outside the food industry.In 2001, we registered ID-IT and acquired a division of another company thatwas distributing the ERP used by IDfoods and some other local customers.We supplied services and software in the Unix world for few years. Recently,we wanted to move on something new and exciting, we knew our Unix stuff verywell, but market demand was on Windows products.This is how we got into the SAP Business One adventure.

3.How would you compare SAP Business One with other ERP products for smallandmid size companies?

One of the main advantage from my point of view for SAP is, its ease ofinstallation and configuration. It is very fast to install and make it workfor a customer, installation is much more efficient than any other software.Users defines tables and fields, SQL query in fields, all this to ease thecustomization without the need of a programmer.If you do need a programmer, all work done through the SDK will becompatible with later releases. It was impossible with previous ERP on themarket.The integration with Microsoft desktop tools is impressive and veryefficient.

4.If you were to add or change an SAP Business One functionality, what wouldit be?

I hope, SAP will add to its core program, all major and popular add-ons.This way, integrity and support will be better.We need a standard WMS, we need integrated EDI, we need B2B in the package,exactly like they did for the excellent XL reporter tool.I am not saying that add-ons are not good, They are very good, my concern ishaving more than one point of support and development.

5.What do you enjoy doing that doesn't involve work?

I enjoy extreme sports. I really need to vacuum my brain once in while.Heavy windsurfing sessions does it very well. I am a fan of everything thatis wind powered, kitesurfing, icesurfing, etc. Winter is also great to dosnowboarding.

To learn more about IDIT Corp
Web site: http://www.iditcorp.com
Email : informations@iditcorp.com

Management Accounting in SAP Business One

Management Accounting, other wise known, as Cost Accounting (in SAP Business One) is one of the functionalities that can be leveraged in SAP Business One. Management Accounting is important for not only SMBs, but also large corporations because it drives internal reporting. Irrespective of the size of a company, the ability to be able to manage the internal flow or trend of expenses and revenue is key to success. More level of details as to the performance of individual business units can be seen and reviewed accordingly.

The bottom line therefore is that, internally consumed reports are used for critical decision making.Management Accounting in SAP Business One is made possible by four major concepts namely: Projects, Profit Centers, Budget and Purchase Accounts Posting System (PAPS).



Projects
SAP Business One allows you to track expenses and revenues of your projects. In a typical company, project differs in shapes and sizes. As a matter of fact, project doesn't have to be a physical or construction activity before it can be used. It could come in some form of "soft form" e.g. Letter of Credits (LC) and special orders. A company that does importation of goods can use projects to track the profitability of individual LCs. Also, a paper manufacturing industry can use projects to track the profitability of a particular special order against another special order for a given product.To create projects in SAP Business One, access the path below:Administration > Set up > Financials > Define Projects

Projects can be attached to a document both at the header level and line level. In whichever case, the corresponding journal entries created inherit the project definition. Furthermore, projects can be tied to business partner and general ledger accounts, thus you don't have to manually assign projects to transactions that relates to the BP or G/L account. The Transaction report by Project allows you to analyze transaction posted for project(s) based on defined criteria.

Profit Centers
In SAP Business One, profit centers and cost centers are jointly managed by the profit center functionality. Ideally, an organization has varying sections or business units where costs are incurred or revenues are generated. For example, the admin departments in most firms do not really generate revenue, but incurs expenses. The sales department on the other hand, generates revenue and also incur expenses e.g. transportation fee. Hence, the profit center feature allows you to track the profitability or otherwise of these departments or cost centers In profit center management, two important phenomenons are worth mentioning namely: Direct expenses/revenue and Indirect expenses/revenue.

Direct expenses/revenue is the expenses/revenue that can be wholly linked to a business unit or department while the indirect expenses/revenue cannot be wholly assigned to a business unit or department. For example, electricity bill. The number of departments in an organization shares the bill. The sharing formula is based on defined parameters like size area. SAP Business One uses the distribution rule feature to enforce this sharing automatically and it can be updated when business rule changes. You can define and manage distribution rules under Financial > Cost Accounting > Define Distribution Rules. Profit centers can be defined in SAP Business One by accessing the path below.Financials > Cost Accounting > Define Profit Centers

Furthermore, for more detailed or summarized level of reporting, sort codes can be used to group profit centers together. The architecture generated in this case is like a parent - child relationship. Profit centers can be assigned to revenue and expense accounts so that when transactions are posted in the system, these accounts are automatically updated. Profit and loss statement can be generated for profit centers.

Budget
Budget is another management accounting tool that can be used in SAP Business One. Budget can be defined by accessing this path: Financial > Budget > Define Budget. The budget functionality is used to control corporate expenses. This implies that budget can be defined for a G/L account or project as the case may be. Depending on the maximum amount specified in the definition of the budget, transaction could be blocked, with or without warning when budget is exceeded. Budget scenarios can also be created in SAP Business One. This allows you to do some kind of budget comparism between say, optimistic, pessimistic and main budgets. Furthermore, budget distribution methods can also be set up in the system. The Profit &Loss Statement Budget Report can be used to track planned balances against actual balances.

Purchase Accounts Posting System (PAPS)
The Purchase Accounts Posting System allows you to better manage a company's budget and expenses. It is a sensitive definition in the sense that once it's activated and journal entries have been created it cannot be updated.Purchase accounts posting system can be activated under:Administration > System Initialization > Company Details.Check the Use Purchase Accounting Posting System box on the basic Initialization tab.On activation of this feature, three accounts are created in inventory tab in G/L account determination namely: Purchase Account, Purchase return Account, Purchase offset Account
Administration > Set Up > Financial > G/L Account determination - Inventory tab

Purchase account: When an A/P invoice or a goods receipt PO is created, the purchase account is recorded in the journal entry along with the same amount that is recorded for the stock account.
Purchase return account: When a goods return or an A/P credit memo is created, this account is recorded in the journal entry along with the same amount that is recorded for the stock account.
Purchase offset account: This account is an offsetting account for purchase account or purchase return account.

The PAPS is a fantastic cost accounting tool because it allows you to define purchasing budget since a purchase account can be made an expense account. Furthermore, if objects such as item groups and warehouses belong to profit centers, purchase account can be linked to their G/L account determination and distribution rule can also be defined for the purchase accounts.

By and large, to drive internal reporting, objective and critical decision making, these functionalities can be leveraged in SAP Business One. The flexibility of report generation is great and if need be, these reports can be exported into external systems for better data analysis.

Costing Methods in SAP Business One: An Overview - Part 1

Inventory valuation is an integral part of a business, especially when stocks are involved. It has direct effect on the cost of sales, which is the summation of initial stock and inventory purchase less final stock. Hence, it is a sensitive phenomenon because it impacts on your financial reports - Balance Sheet and Profit/Loss and even Tax reports. From the foregoing, it can be said that, inventory valuation is one of the metrics for determining the profitability of a business.

SAP Business One supports only three types of costing or inventory valuation methods namely: Moving Average, FIFO and Standard Price. The golden rule is that, continuous stock management must be activated before this functionality can be leveraged. Continuous stock system is defined under: Administration > System Initialization > Company Details > Check default valuation method box (see figure below).



Irrespective of the costing method leveraged, prices are calculated in local currency.

Moving Average: Inventory is valued using the cost price of the items. On receipt of goods, the value is automatically updated. A stock receipt transaction that affects accounting, debits the stock account while a release transaction that affects accounting credits stock/sales return account based on the cost price of the item.

Standard Price: When standard price is used as the costing method, a static price is defined for each item. On stock receipt, it is not automatically updated. The standard price method is advantageous in cases where you produce the items yourself. A stock receipt transaction that affects accounting debits the stock account based on the standard price defined for the item. Very often than not, variance does occurs, thus the difference between the standard price and the receipt document price will be posted to a variance account. A stock release posting on the hand, credits the stock account according to the standard price defined for the item.

FIFO: The FIFO inventory valuation method uses a "First- In- First Out" methodology.This methodology ensures that when goods are received, a step-like arrangement or layer that is based on cost, quantities and entry date is created. And during goods release, the goods from the first layer (open) and their corresponding cost are used.

Thus, the choice of which of the costing method to use is a function of the objective to be achieved. Good enough, SAP Business One allows so much flexibility as it relates to costing system. Different costing method can be defined for different items and you can change the costing system of your items globally. However, it is important to note that continuous stock system cannot be deactivated after stock posting have been made.

In this posting, I have only given an Overview of the costing methods in SAP Business One. In my subsequent postings on the subject matter, I'd concisely analyze the journal implications of each of these methods for sales, purchasing, inventory and production transactions.

Cycle Counting: Inventory Audit in SAP Business One

Introduction
Cycle Counting is a necessary action in inventory management. The implication of wrong inventory can be grave for a company. It not only mislead in the available stock quantity, but also in the actual stock value - accounting. A number of practices can be leveraged when auditing inventory, however, in this paper, I intend to explore cycle counting as an inventory audit tool. This subject topic will be discussed in the following parts: The Concept, Why Inventory Audit, Frequency of Audit, When to Audit, The Process in SAP Business One and Recommendations.

The Concept
A few months ago, my colleague and I went for a management demo of SAP Business One for a leading bookshop in Nigeria. And you know what? The Chief Financial Officer asked a fundamental question: What happens if I've got some stocks physically in my warehouse and the system displays zero stock, will I be able to sell? What's on your mind, negative stock management? Well, that concept is a topic for another posting. Well, for me, what struck me was inventory record inaccuracy. The nightmare of an entrepreneur among other things includes the correctness of his stock record, hence the need for a stock auditing infrastructure like Cycle Counting. This kind of system is provided in SAP Business One.

Thus, it is expedient that inventory be counted at defined intervals and if variances occur, it should be reconciled. The process of inventory audit follows some sequential steps as detailed below.
1. Print out the inventory status from the system
2. Perform the physical count of the item and record your findings
3. Ascertain the correctness of the count by recounting
4. Record the count result in the system
5. If variances occur, post the stock difference.

As a matter of fact, inventory records are not always 100% accurate. Variances do occur, depending on the item type, volatility and frequency of movement. Hence, tolerance (in %) can be defined to cover this lapse. However, as much as possible, 100% accuracy should be the target.Why Inventory Audit The need for inventory audit is enormous. Broadly, inventory audit is of great interest and importance to two sets of people in a firm - the Financial Controller and the Planning Manager. While the Financial Controller is concerned about the accuracy of the stock value, the Planning Manager is concerned about the accuracy of the stock quantity. In whichever way you look at it, the stock quantity is the driver of the stock value. For the Financial Controller to know the correct stock value, the stock quantity must have been duly counted and multiplied by the cost of the item.

From the foregoing therefore, we can safely attribute the aim of inventory audit to the following factors:
1. Stock record accuracy.
2. Early discovery of inventory problem and immediate resolution.
3. Gross to net calculation accuracy.
4. Effective customer service as a result of on-time order fulfillment
5. Better planning based on accurate stock status

Frequency of Audit
How often inventory counting occurs is termed cycle frequency. As asserted earlier, auditing is quite important to the Financial Controller and the Planning Manager. The Financial Controller can be pretty comfortable with auditing inventory records annually. The planner is most likely to perform inventory audit more often - daily, weekly, monthly or annually.When to AuditIt is good practice to define cycle frequency for an item in the system. The challenge is, when should inventory be counted?

The following can be used as guidelines in facing the challenge.
1. Before an order transaction is created.
2. On receipt of an order.
3. When inventory level is zero.
4. After a defined number of transactions have been carried out.
5. When an emergency count is needed.e.g questionable negative stock.

The Process in SAP Business One
The inventory counting system in SAP Business One is feature rich enough to meet the auditing needs of small and medium scale businesses. With SAP Business One, controls can be set up to eliminate errors that might arise as a result of inventory posting activities during physical counting. This can be achieved by activating the locking feature of an item or warehouse in the item master data - check the Locked indicator. Alternatively, you can disable the document numbering functionality - Administration > System Initialization > Document Numbering - check the Locked field.SAP Business One adheres strictly to due process of inventory counting (see 2nd paragraph - The Concept). This transaction can be achieved by accessing the following path. Inventory > Inventory Transaction > Beginning Quantities, Inventory Tracking Stock Posting.

SAP Business One and Inventory Differences
In most cases, after inventory count, discrepancies often occur between the supposed stock value and the actual stock value, hence the need to reconcile the inconsistencies. As a matter of fact, SAP Business One requires you to post the variance in order to modify the stock value in accounting. This functionality is achieved by accessing this path: Inventory > Inventory Transactions > Beginning Quantities, Inventory Tracking Stock Posting. Select the stock posting Tab. The screen displayed is shown below.



For increased flexibility, SAP Business One provides three options in which the value of an item can be calculated, namely: Price List, Last Revaluation Price and Cost Price. What is more? Only the quantity of an item will be modified when Allow Inbound Posting without Price field is activated. It is important to note that, when the cost price list is chosen in the Price Source for Whse Stock Posting field, the current cost must be recalculated before the variances are posted in the system using the inventory valuation report.

SAP Business One and Cycle Frequency
SAP Business One allows you to define the frequency, alert date and time for your inventory count. This can be achieved by accessing this path: Administration > Setup > Inventory > Inventory Cycles.The following frequency can be defined: Daily, Weekly, Every 4 weeks, Monthly, Quarterly, Semi-annually, Annually and One-time. Furthermore, a comprehensive report recommendation for all scheduled inventory count can be generated in SAP Business One. The alert integration serves as a reminder functionality based on predefined time.

Recommendations
By and large, we have critically analyzed the concept and features of cycle counting and how SAP Business One can be leveraged in this direction. Irrespective of the effectiveness of an inventory counting system, whether in-built in an ERP system or standalone, the human factor is key to the accuracy of inventory records. The following points are recommended steps to be taken, especially as it relates to the human factor.

1. Comprehensive numbering and item description system. This will go a long way to drive correct and easy identification of items
2. Quantity Verification and Price: Considerable time should be spent in posting transaction fields, especially the quantity and price. Basically, the stock quantity affects the stock level and stock value at any point in time
3. On-time transaction entry and execution: It's not enough to just record transactions into the system. Transactions should be recorded as at when due and the physical movement of the goods must be carried out accordingly.
4. Use trained expert: Personnel concerned with stock taking and counting must be highly skilled in the field. It's not a job for dummies!
5. Warehouse safety and security: Wharehouses must be locked and protected at defined time, especially when transactions are not taking place, say at night. This is to prevent stock damage, inventory pilfering and theft.

Approval Procedures: Line Level and Header Level - Part 2

In the Part 1 of this entry, I treated the set-up for approval procedure at the line-level. The set-up for the header level can be found at http://blogs.ittoolbox.com/sap/kehinde/archives/approval-procedures-line-level-and-header-level-part-2-9689.

Regards!

SAP Business One on Oracle: Still a Mirage!

A Service firm recently approached my company and they require us to support their SAP Business One system that runs on MS SQL and has an external billing system that runs on Oracle database. What do you think? It'd have been great if SAP Business One supports Oracle database. Better integration I believe!

Clearly, SAP Business One can only be deployed on three database systems: Microsoft SQL Server, IBM DB2 and Sybase. I have managed large Oracle database systems, so I know from experience that Oracle is extremely robust. Therefore, I would not know why SAP does not consider Oracle as one of the database systems for SAP Business One, even though Oracle and SAP have been working together since SAP R/3 was first developed in the late 1980s.

From the foregoing, I have made some assertions why SAP Business One on Oracle is still a mirage. I may be wrong. I stand to be corrected.

1. Cost: An average individual tends to see Oracle as an expensive database system. And since SAP Business One is targeted towards small and medium scale businesses, it might increase the total cost of ownership of SAP Business One, if companies get to use Oracle as the database system upon which their system sits. Hence, the reason to partner with less expensive database system vendors because small and medium scale companies are not buoyant enough to afford such cost. However, Oracle too supports small and medium scale businesses with one solution or the other that uses Oracle database.

2. Database Management: With due respect, it's more technically challenging to manage an Oracle database system when compared to MS SQL, IBM DB2 and Sybase. Small and medium scale businesses might not be able to afford the technical experts needed to manage such database - Oracle. The cost of hiring technical personnel to manage an SAP Business One on Oracle database system can also increase the total cost of ownership somehow and small and medium size companies are not cut out for this.

3. Database Size: Experience has shown that in choosing the database system for SAP Business One, the maximum expected database size is a critical consideration factor. Oracle no doubt, is designed to supports large databases. As a matter of fact, the current release of Oracle, Oracle 10g supports database size of up to 8 exabytes - about 8 million terabytes. However, SAP Business One is meant for small and medium companies. May be it is assumed that its (SAP Business One system) database size cannot be really large as to require an Oracle database.

4. Corporate Feud: The first thing that comes to mind when you mention Oracle is database management system and SAP, enterprise resource planning system. However, over time, Oracle has gone into ERP system development. This singular action has created serious competition in the market place and the quest for market dominance has paved way for open conflict between the two software giants. Hence, can it be said that it's this corporate tussle that is responsible for SAP not partnering with Oracle (or vice versa) as it relates to SAP Business One?
May be yes. However, on a closer look, one can say No. This is because; Microsoft who even poses more threat to SAP, especially in the SMB market space has a database system (MS SQL) that is supported by SAP Business One.

5. Corporation Readiness: Another reason that comes to my mind is probably the readiness of either (or both) company at the time of rolling out SAP Business One. May be Oracle or SAP has not technically finished work on the supporting features that will make SAP Business One on Oracle work. However, SAP Business One has been around for a number of years now. One would have expected work to be have been finalized. Are they still working on it? Am just thinking…!

I believe that SAP Business One on Oracle will provide more functionalities and flexibility for SAP Business One users. Anyone with information on why Oracle is not a supported database system for SAP Business One should drop me some lines or are you thinking too?

Approval Procedures: Line Level and Header Level - Part 1

I have read a number of postings on the SAP Business One Discussion Forum saying that approval procedures can't be defined on line level i.e. for line tables. It's not true! What is true is, the $[Tablename.Fieldname] syntax doesn't work for line tables. I would use a similar challenge I once had and which is similar to a question posted on SAP Business One Discussion Forum to explain how you can set up approval procedures at the line level and the header level.

Statement of the challenge: (as posted on the forum)
I need to set up approval for two scenarios.
1. When creating a PO and I attach it to a project, I want approval to be triggered for the approval of the project head and then the Managing Director.
2. When creating a PO and no project is chosen, the approval should be triggered for the approval of the Head of Department and then the Managing Director.
Note: Two approval templates are needed: A and B
Two approving authorities per template.
It's like an If-then-else thing:- if project is chosen, then project Head+MD (A); otherwise
HOD+MD (B)
Ideally, the query should start with "SELECT DISTINCT 'TRUE'.....
Projects can be attached in the line item (activate 'project' using form settings) or header (accounting tab of the PO document).

Understanding the challenges
The crux of the question is not just how to set-up approval for a purchase order, but to direct/redirect the approval to separate approving authorities if project is picked or not picked at
(1) Line level
(2) Header level.
Suffice to say that Project can be picked on both line level and header level as shown in Figure 1 and Figure 2.

Figure 1


Figure 2


The first part of this paper will address the Line level set up while part 2 will address the Header Level set up and conclusion - business rule recommendation.

Procedure
- Open the purchase order.
- Click on View (on the menu bar) > System Information to get the Field's item number, Field's column number or press Cltr+Shift+D

Field's item number =38
Field's column number = 31

Using the syntax $[$Field's item number. Field's column number. NUMBER/CURRENCY/DATE/0]

The query syntax for when project is picked is as follows

if (SELECT $[$38.31.0]) > ' '
select 'true'

Save this query as LPROJ=YES

The query syntax for when project is not picked is as follows:

if (SELECT $[$38.31.0]) !> ' '
select 'true'

Save the query as LPROJ=NO

Create approval stages for each of the approving authorities: Project Head - SPH, Head of Department - SHOD and Managing Director - SMD.
A sample approval stage for Project Head - SPH is shown in Figure 3 below. (This should guide you through that of the Head of Department and Managing Director)

Figure 3


Create two approval templates namely
LPROJ_Y and LPROJ_N

Administration > Approval Procedures > Approval Templates

LPROJ_Y
Name: LPROJ_Y
Description: Line Project = Yes
Originator: Purchasing Officer - PO
Active Box: Checked
Documents: Purchase Order - Checked
Approval Stage: 1. SPH and 2. SMD
Terms: Check the radio button When the Following Applies and attach the LPROJ=YES named query to the template.

Sample approval template - LPROJ_Y is shown in Figure 4

Figure 4


LPROJ_N
Name: LPROJ_N
Description: Line Project = No
Originator: Purchasing Officer - PO
Active Box: Checked
Documents: Purchase Order - Checked
Approval Stage: 1. HOD and 2. MD
Terms: Check the radio button When the Following Applies and attach the LPROJ= NO named query to the template.

Test the Set up
Log on to the system as the Purchasing Officer - PO.

Action 1: Attempt to create a Purchase Order and choose project on the line level.
Result 1: Request for approval (LPROJ_Y) is triggered.
See Figure 5

Figure 5


Action 2: Attempt to create a Purchase Order and don't choose project on the line level
Result 2: Request for approval (LPROJ_N) is triggered.
See Figure 6

Figure 6


Are you now convinced? It does work for line level.

I'd like to appreciate Riaan Bester of Silverhedge Solutions, South Africa for his contribution.

Note:
1. Ensure that Activate Approval Procedure is activated -
Administration > System Initialization > General Settings > BP Tab
2. Users are defined in the system appropriately.
3. Ignore the error messages that you get in the Query Generator or Wizard (if you save your query via the tool)
4. You must be a member to access the forum link
5. Paths and field names may differ depending on the version. The version used here is 2005.

Independent Demand Vs Dependent Demand: MRP is a Calculator!

The MRP system in SAP Business One takes in a number of parameters as inputs and performs some level of analysis and generates recommendations that can either be accepted or rejected by the planner. One of the inputs of MRP is the bill of material, which is a list of all components (and in what quantity) needed to produce finished good(s). For example, the bill of material needed to produce a dinning set is 6 chairs and 1 table (supposedly). The demand for the dinning set here is independent while that for the chairs and table are independent.

An independent demand is a demand that is not based on the demand for another item while a dependent demand is based on the demand for another item. Hence, it can be concluded that the demand for the 6 chairs and the table is based on the demand for the table. Thus, you can forecast an independent demand while dependent demands are calculated based on the independent demand item. The role of the MRP therefore is to perform this calculation. Hence, is it right to say that MRP is a calculator? May be yes...