The Accounts Payable application component records and manages accounting data of all vendors.
The vendor master records are maintained in sub-ledger and are used in Financial Accounting and Materials Management. By storing vendor master data centrally and sharing it throughout whole organisation, it is only needed to enter it once. It gives an ability to prevent inconsistencies in master data by maintaining it centrally.
Vendor Master is the central part of Account Receivable component of SAP Financials.
Vendor Master Data plays a vital role in making payment. This is the reason why in this post we will go through the important fields available in Vendor Master Data in this post. This post will work as a base for understanding the posting of documents and payment transactions in accounts payable.
Before going ahead it would be important to understand that the Vendor Master data is divided into following three parts:
- General Data
- Company Code Data
- Purchasing Organisation Data
In this post we will look into the General Data part of the Vendor Master.
Creation of Vendor Master
Transaction Code: FK01
System will navigate you to the screen as appearing in Image 1.01
The screen has following fields available for entry. We will try to understand all of them one by one:
In case of Vendor Account Group with external numbering, we have to enter the desired vendor code here. In case of internal numbering keep the field blank.
Enter the company code for which you wish to create the vendor.
Extension of vendor code can be done with same T Code, in such case system copies general data and allows us to maintain Company Code Data.
This is the most important part of Vendor master. A Vendor Account Group determines the number range in which vendor code will be made and also if the number range is external or internal.
Apart from the above, we can see another part which is to reference the data from other Vendor Master.
Enter the Company Code, Account Group (with internal number assignment) and press enter, the system will navigate you to the screen appearing in the Image 1.02
The screen appearing above is the first screen in Vendor master data creation. This is part of General Data. Let’s go through the various information to be maintained on the screen one by one:
This is the salutation to be entered and options are Company, Mr., Ms.
This is the fields where we have to enter vendor name. By default SAP allows entering of 40 characters in this field. If vendor name is more than that we can maintain the same under Name2 i.e. the field just below Name.
SAP has provision of four fields to enter vendor name
Search Term 1/2
This field is a kind of shortcut to find a vendor. The Search Term 1 is available under search help for vendor master.
Note: This field becomes useful when vendor needs to be searched by some characteristics other than Vendor name. For e.g. you may want to see all the Raw Material vendors at a go instead of remembering names of all of them, in such case enter “Raw Material” as Search Term in all the vendor masters related to Raw Material and then the search will reveal all the vendors together.
There are many fields available under this section where we can enter the communication address of the vendor.
This part contains information required to communicate with the vendor like Telephone Number, Mobile Number, email id. Etc.
Enter all the relevant data and press enter and the system takes us to the next screen of Control Data as appearing under Image 1.03
In this screen we will concentrate on some of the fields:
Using this field we can link a customer code with the vendor code. If we enter customer code here, system activates a radio button under “Payment Transaction Accounting” screen under (Refer Image 1.07) company code data where we can opt for clearing of the customer balance with vendor balance while making payment or dunning.
This field allows us to enter a 4 digit code which works as an authorisation for controlling of vendor transactions at user level. In case we have to use this functionality you need to do the following steps:
Maintaining Authorisation Group
Using T Code SM30 edit table V_TBRG and click on maintain and the system will ask to enter Authorisation Object as appearing under Image 1.04
Enter the Authorisation Object F_LFA1_BEK and the system will open the table to maintain Authorisation Group and description as per your requirement for e.g. Group A001 with description Raw Material Vendors, Group A002 with description Expense Vendors etc.
In Vendor Master maintain the Authorisation Group define as above in the field provided as Authorization. For e.g. in case of Raw Material Vendors we will enter A001, this will help us allow authorisation of Raw Material Vendors to particular users
The Basis Team needs to be informed for maintaining the value A001 in Authorisation Object “F_LFA1_BEK” in the Role of users to whom we want to grant access of Raw Material Vendors. This will restrict the access of Raw Material Vendors to particular users.
Note: Users with value as blank under Authorisation Object will have authorisation to use all the vendors under any authorisation group. In order to make this authorisation work, assign dummy authorisation group to other users.
The screen contains many other fields which are not mandatory and we will not discuss on them in this post. Now press enter and we go to the next screen as appearing in Image 1.05
This screen contains many important data which we will discuss below:
This part of the screen needs information on Bank Account details of the vendor. Given below is the detailed information on the fields available:
Enter the country in which vendor’s bank exists
Enter the Bank Key if already create for the vendor’s bank. In case the key is not available create the same using T Code FI01.
Enter the vendor’s Bank Account Number here
Here you can enter another name that the payment program can use if the name of the account holder is not the same as the name of the customer or vendor.
This key represents the nature of account. The nature of account differ from country to country. Hence, refer the banking system in the vendor’s country to identify the key to be maintained.
Enter the IBAN Number here if available.
Partner Bank Type
If several bank accounts exist in a customer or vendor master record, you can assign different keys for these accounts.
This is an additional field made available to enter if any further details are to be maintained.
Above information becomes very important in case where payments are made directly to vendors based on this data.
This field is another important field available to make payment to vendor in some name other than in the existing master. For example the invoice of Mr. XYZ is received and booked in the system but the payment is to be made to Mr. ABC on behalf of Mr. XYZ, in such case this field comes into picture. For meeting this requirement, we have to create a vendor master for Mr. ABC and enter that code in this field of Mr. XYZ’s vendor master. This way while creating payment the details fetched are from Mr. ABC’s vendor master.
This field is applicable in Germany only.
For automatic payment transactions, this field (along with the house bank country and the payment method determined by the payment program) controls which statements are given to the participating banks when carrying out the payment order. This field is used in countries such as Germany, Austria, the Netherlands, Spain, Norway, Finland, and Japan as well as for the international SWIFT format, MT100.
This field is applicable in Switzerland
This is a functionality provided by SAP to allow making payment in the name other than the vendor master. We have already seen Alternate Payee where we create a new vendor master and assign it in the master. But if we use this functionality, system allows the user to enter the payee name while booking the entry (just like one time vendor). The payee details entered by the user during document posting are stored in the system and used while making payment.
This is an additional feature to make payee other than the vendor. This feature allows us to maintain the list of possible payees to whom the payment can be made. Once this list is maintained in the vendor master the same becomes available for selection during document entry like in T Code FB60 becomes available in Payment tab. The user has to select the payee in whose name the payment is to be made. If no payee is selected, the payment is made in the name of original vendor.