Vendor Master Data
Vendors are your suppliers of goods and services. Vendor Master Data records contain all the pertinent data needed to place orders, post invoices and issue payments. We can consider each individual vendor master record as a sub-ledger.
The sub-ledger concept means that we can maintain individual vendor transaction details within the vendor master record itself. Collectively, the balances of all vendor master records roll up into a single GL Account known as an Accounts payable reconciliation account.
We create & maintain Vendor master records in the application menu path.
Structure of Vendor Master Data in SAP
Vendor master data is made up of three distinct parts:-
- General data
- Company code
- Purchasing organization data.
Let us understand each of these.
General Data
Display Vendor Transaction Code– FK03. To see General data, you only need to enter a vendor and check the boxes under General data that you want to view. When all your selections are made, press (Enter).
The Display Vendor Address screen opens. You will see the Name of the Vendor, along with pertinent address and communication fields. In search term ½ fields, you can enter two separate values for use when searching for vendors. Also, you can use the two fields independent of one another.
The Display Vendor Control Screen
In the Account control area, grouping functions are enabled. For example, if a vendor is also a customer, you can enter the correct customer number in the Customer field. Doing so allows for joint management of a business partner and provides the ability to offset payables with receivables in SAP during automatic payment.
The Tax Intimation Area
In the Tax intimation area, the vendor’s tax identification numbers, jurisdiction codes and other tax-related information are specified. If the vendor is an individual, you can enter withholding tax information at the bottom of the screen in the Person subject to withholding tax area.
In the Reference data area, you can specify external reference numbers and indicators as applicable. For example, if you report on vendors within a specific industry, you can assign a code in the Industry field.
Display Vendor- Payment transactions screen
In the Bank Details area, you can enter a vendor’s bank details.
The payment transactions area largely consists of country-specific settings. However, in the Alternate payee field, you can enter a different vendor number if payment is to be made to a vendor different from the one to whom the payable is owed. To specify an alternate payee in the document, adjust the settings in the Alternate payee in the document area.
Read: Bank Accounting Configuration in SAP
Company Code in Vendor Master Data
Under the Vendor Company Code Data, note that Withholding tax is only available when extended withholding tax is relevant. When you make all your selections, Press Enter.
The Display Vendor
The accounting information screen opens corresponding to the first checkbox selected. The most important field on this screen is the Recon. Account field in the Accounting information area. This field lists the reconciliation account updated parallel to the vendor sub-ledger account for normal postings. Special postings (down payments) post to different G/L accounts as designated in the configuration.
Also read: G/L Master Data in SAP
The Accounting information screen of the vendor master data also contains values for interest calculations withholding taxes and reference data.
Payment Transaction screen
This screen contains payment terms (pay Term Field) which defaults from vendor master data into invoices during the document creation process. Also noteworthy in the Payment Data area are the Tolerance group field and the check double invoice checkbox. Tolerances affect cash discounts and allowable payment differences.
Selecting the Check double invoice, the checkbox searches for duplicate invoices during document creation based on vendor, currency, company code, gross invoice amount, reference document number and invoice date. This option provides a safeguard to avoid the risk of entering the same invoice more than once.
The Automatic payment transactions area contains important information relevant to the use of the automated payment programs. You should be familiar with these fields because they can and often do impact the output of your automatic payment runs.
Purchasing Organization data
Purchasing Organization data is a part of Logistics. All the information related to procurement is updated under this segment. It includes Pricing Procedure, Condition information, Purchase order information, and partner function.
This part of the vendor master Data structure is important for logistics users.
More information will be updated in this section soon.
Who to do this Vendor Master Data?
The Super-users usually do all the vendor payments work. Further, Vendor Master Data records are created & managed by them. i.e. end users, super users in FICO. Thus, learning this subject is mainly important for the end-user segment people of finance.
Consultants need to coordinate with end users to properly work on the process.
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