SAP MM Study:Physical Inventory

Main Business Scenario

Your enterprise has to carry out a physical inventory of its warehouse stocks at least once per fiscal year to balance its inventory. Various procedures can be implemented for this.

In a periodic inventory, all the enterprise’s stocks are physically counted on the balance sheet key date. Every material has to be counted. During counting, the entire warehouse must be blocked for material movements.

In the continuous inventory procedure, stocks are counted continuously throughout the entire fiscal year. In this case, it is important to ensure that every material is physically counted at least once during the fiscal year.

You can also implement special procedures, such as cycle counting (physical inventory at regular intervals) and inventory sampling (physical inventory of randomly selected stocks).

Physical Inventory types:

Periodic; Sampling; Continuous; Cycle Counting

With both continuous and periodic inventory types, the following stock types can be
included in the physical inventory:

-Unrestricted use stocks in warehouse
-Quality inspection stocks
-Blocked stock

The cycle counting inventory method creates a physical inventory document only for stock
type 1 (unrestricted use).

The inventory sampling procedure is only applicable to stock types 1 (unrestricted use)
and 2 (quality inspection stocks).

The Physical Inventory Process

Create physical inventory document->Set blocking indicator->Print physical inventory document->Enter count results->List of differences->Post differences

Physical Inventory Number:

The physical inventory number was created as an additional hierarchy above the physical inventory document number. You can use it to group together different physical inventory
documents that belong together organizationally.

You assign physical inventory numbers when you create and change physical inventory documents, and you can use them as an extra selection criterion for physical inventory reports. This enables you to directly display the physical inventory documents per storage location, customer, or vendor.

If you have not finished entering the complete physical inventory count, you can freeze the book inventory balance in the physical inventory document to prevent goods movements from changing the book inventory balance relevant to the physical inventory count, which would result in incorrect inventory differences. You define in Customizing for Inventory Management whether you can freeze book inventory balances in the storage location.

When entering a physical inventory count with reference to a physical inventory document that contains many items with a quantity of zero, you can set zero count automatically for all items that have not yet been counted.

In Customizing for Inventory Management, you can define the following value tolerances for posting inventory differences for a user group:

maximum amount per physical inventory document maximum amount per document item

Relevant tables:

IKPF: Header: Physical Inventory Document

ISEG: Physical Inventory Document Items

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