When the material ledger is active, the system automatically collects specific information on valuation-relevant transactions and account postings from inventory management, invoice verification and order settlement, and uses this data during material price determination.

This automatic collection of data from accounts and the subsequent transfer of the data to the material ledger is called the material ledger update. The data is collected in the material ledger in up to three currencies and valuation views.

The differences are posted as follows:

• Price differences

• Exchange rate differences

• Differences from revaluations

Consumption (withdrawal for a production order or a cost center, for example) is always posted at the current valuation price and collected in the material ledger. No differences occur in this case. You can see this consumption under Other inward/outward movements in the material ledger data display.

Data is collected in the material ledger for all materials for which the material ledger is active, independent of the material's price determination.

With single-level price determination, you can influence how the periodic unit price is calculated by determining how the data is collected. You can specify this through a material update structure in Customizing of Actual Costing/Material Ledger.

In Customizing under Controlling ® Product Cost Controlling ® Actual Costing/Material Ledger ® Material Update you carry out the following steps:

• Define the movement type groups of the material ledger
• Assign the movement type groups of the material ledger
• Define the update structure

• Receipts
• Other inward/outward movements
• Consumption

By defining which transactions flow into which categories, you can separate withdrawals that you want to have an effect on the periodic unit price from other withdrawals that should not, for example.

The posting logic of transaction-based price determination corresponds to that of the system without the material ledger.