FI-MM Integration in SAP

FI-MM Integration is based on the following:

 Movement Types
 Valuation Class
 Transaction Keys
 Material Type

The Movement Type is the ‘classification key’ indicating the type of material
movement (for example, goods receipt, goods issue, physical stock transfer). The
movement type enables the system to find pre-defined posting rules determining
how the accounts in FI (stock and consumption accounts) are to be posted and
how the stock fields in the material master record are to be updated.

The Valuation Class refers to the assignment of a material to a group of GL accounts.

Along with other factors, the valuation class determines the GL accounts that are updated
as a result of a valuation-relevant transaction or event, such as a goods movement. The
valuation class makes it possible to:

 Post the stock values of materials of the same material type to different GL accounts.
 Post the stock values of materials of different material types to the same GL account.

The Transaction Key (also known as the ‘Event Key or Process Key’) allows users to differentiate between
various transactions and events (such as physical inventory transactions and goods movements) that occur
within the area of inventory management. The transaction/event type controls the filing/storage of
documents and the assignment of document numbers.
  The Material Type groups together materials with the same basic attributes, for example,
raw materials, semi-finished products, or finished products. When creating a material master
record, you must assign the material to a material type. The material type determines:
 Whether the material is intended for a specific purpose, for example, as a Configurable
 Material or Process Material.
 Whether the material number can be assigned internally or externally.
 The Number Range from which the material number is drawn.
 Which screens appear and in what sequence.
 Which user department data you may enter.
 What Procurement Type the material has; that is, whether it is manufactured in-house or
 procured externally, or both.
 Together with the plant, the material type determines the material’s inventory management
 requirement, that is:
 Whether changes in quantity are updated in the material master record.
 Whether changes in value are also updated in the stock accounts in financial accounting.

 Movement types

Classification key indicating the type of material movement (for example, goods receipt,
goods issue, physical stock transfer).

The movement type enables the system to find predefined posting rules determining how
the accounts of the financial accounting system (stock and consumption accounts) are to
be posted and how the stock fields in the material master record are to be updated.

 Valuation class

Assignment of a material to a group of G/L accounts

Along with other factors, the valuation class determines the G/L accounts that are
updated as a result of a valuation-relevant transaction or event, such as a goods
movement.

The valuation class makes it possible to:

- Post the stock values of materials of the same material type to different G/L accounts
– Post the stock values of materials of different material types to the same G/L account

 Transaction/Event Key
Key allowing the user to differentiate between the various transactions and events (such
as physical inventory transactions and goods movements) that occur within the field of
inventory management.

The transaction/event type controls the filing/storage of documents and the assignment of
document numbers.

 Material Type

Groups together materials with the same basic attributes, for example, raw materials,
semifinished products, or finished products.

When creating a material master record, you must assign the material to a material type.

The material type you choose determines:

- Whether the material is intended for a specific purpose, for example, as a configurable
material or process material

- Whether the material number can be assigned internally or externally

- The number range from which the material number is drawn

- Which screens appear and in what sequence

- Which user department data you may enter

- What procurement type the material has; that is, whether it is manufactured in-house or
procured externally, or both together with the plant, the material type determines the
material’s inventory management requirement, that is:

- Whether changes in quantity are updated in the material master record

- Whether changes in value are also updated in the stock accounts in financial accounting