You can use this business process to manage your Physical Inventory if you have stocks or special stocks in your warehouse.
There are several different kinds of Physical Inventory that can be managed, for example:
· Periodic inventory
· Continuous inventory
· Cycle counting
· Inventory sampling
However, the process of taking the inventory remains the same, whichever method of Physical Inventory you choose.
Physical inventory is the process of counting materials in your storage location, whether these stocks are your own materials or special stocks. Physical inventory can be conducted annually or continuously and for legal reasons, balance sheet purposes, or internal controlling reasons. The process of taking a Physical Inventory involves preparation, execution, and review.
For more information on inventory management and the Physical Inventory, see the SAP Library under SAP R/3 Enterprise ® SAP ERP Central Component ® Logistics ® Materials Management (MM) ® Inventory Management (MM-IM) ® Inventory Management and Physical Inventory (MM-IM) ® Physical Inventory.
This business process runs in SAP R/3 Enterprise:
1. Prepare physical inventory.
Create the inventory document. We recommend doing this in sessions.
In the inventory preparation phase of Physical Inventory, you plan which material needs to be counted on which dates. The objective could be to count every material in the specific storage location on a periodic basis or to count every location within some time period.
In the execution phase, warehouse workers count, weigh, and measure materials. These counts are then compared to the system balance and become the basis for review.
In the review period, balances are verified and checked and sometimes materials are recounted. When the final counts are accepted, the inventory balances are updated on quantity as well as value level.
We support multiple methods of Physical Inventory, including:
¡ Continuous Inventory during Stock Placement
¡ Zero Stock Check
¡ Annual Inventory
¡ Continuous Inventory
¡ Inventory Sampling
¡ Cycle Counting
No matter which inventory method you choose, the process of conducting an inventory remains the same.
In the preparation phase of the Physical Inventory process, you need to choose the materials to be counted. This can be done manually, or automatically driven from customizing settings. As a result, a Physical Inventory Document is created. This document contains the list of materials relevant for counting.
2. Activate inventory record.
When this step is completed, all storage locations are blocked and ready to be counted.
When the inventory document is activated, the items within the specific storage locations that are to be counted are blocked. If there is an open requirement against a specific item within a storage location, that item can be counted against an inactive inventory document and the document can be activated automatically when the last open requirement is cleared against that item.
Once the document is activated, it is ready for printing. The Inventory Document could be prepared, printed, and then handed to a warehouse worker. If the worker is using a radio frequency (RF) device, the user can enter the counts directly on the handheld. Whether the document is printed or viewed on the RF device, the process for counting the materials remains the same.
3. Process physical inventory count.
The warehouse worker goes to the storage location where the items are stored and counts the stock. The worker might count only a particular item (in the case of mixed storage) or the entire stock.
If a printed document is used, the worker counts the materials and enters the count on the document for data entry at a later time. If an RF device is used, the worker scans or enters the quantity directly via the device.
When this step is completed, all inventory balances counted by the user are updated in the count document, but the Physical Inventory balance has not yet been changed.
4. Initiate recount.
There could be differences between the quantity that was counted by the warehouse worker and the quantity that is held in the system for a particular item. A Differences Report can be run to check those differences. If there are inconsistencies, recounts can be initiated.
When the counts have all been entered for an inventory document, you need to check whether differences exist. If so, the warehouse supervisor might choose to have the worker recount certain materials. In that case, a Recount Document is generated and either reprinted or reassigned to the RF user and the inventory count is repeated. This can done repeatedly until the difference is found or is accepted.
The recounting process creates another version of the Inventory Document.
5. Clear differences in quantities and values.
Clearing differences means you are ready to accept the counts from the Physical Inventory process. This can be done automatically in the background based on configuration options that you have set.
Clearing difference in Inventory Management means that you are ready to create inventory adjustments and accept the fiscal gain or loss in any difference that has been reported. At the same time you are unblocking the items within the storage location for new movements.
When the differences are cleared in Inventory Management, the process is complete. Clearing differences in Inventory Management creates an accounting document in the financial system that references the Physical Inventory document.
When this step is completed, all inventory balances are updated in the system and the appropriate accounting documents are created.