The system needs to be configured properly with ‘Tolerances’ so that you are not hampered with variances when you try Invoice Verification. You need to define the lower and upper limits for each combination of the Company Code and the tolerance key defined for the various variances. The system then checks these tolerance limits and issues warnings or prevents you from proceeding further when you process an invoice.
‘Variances’ arise because of mismatch or discrepancies between the invoice and the PO against which the invoice has been issued. Normally you will encounter:
- Price variances: If there is a discrepancy in invoice price and PO item prices.
- Schedule variances: If the planned delivery date is later than the invoice postings.
- Quantity variances: If the delivered quantity (or delivered quantity less the previously invoiced quantity) is not the same as that of the invoiced quantity. When the invoiced quantity is more than the GR, the system requires more GRs to square off the situation.