Materials that are entered into an SAP system as inventory are either plant stock or special stock. The most common examples of special stock are consignment stock and project stock. Consignment stock is stock that is loaded into and managed within an SAP system, and is usually on site, but actually still belongs to a vendor. Project stock is stock that is obtained for and dedicated to a specific project. An SAP project is a large unit of work that is managed by the Project System module and is broken down into smaller units of work called work breakdown structures (WBSes). Resources in the form of funding, labor, and materials are allocated to the project at the WBS level. Plant stock then is any inventory that is not special stock. It is neither still owned by a vendor, nor obtained for and dedicated to an SAP project. Plant stock is obtained by the company and entered as inventory for normal use – that is, for any purpose or work that is not project related. For example, in a maintenance type facility, plant stock would be obtained and kept on hand as recommended spare parts for various systems and equipment that would likely require repair or replacement at some point in the future.
Your project or company uses SAP materials management (MM). Go-live occurred some time ago. Any consultants you may have used are long gone, and you’re now in sustainment mode. You – the users, managers, and support personnel – are left to function with what was created. You are expected to understand the system resulting from all the configuration and you must make it work. But how do you deal with the complexity and confusion of MM on a daily basis? Here are some issues related to MM:
- Nothing is more confusing to users than the depiction in purchase order (PO) history of multiple goods receipts or reversals, invoices or reversals, and subsequent debits or credits that do not balance out. This report clarifies the confusion, explains how to correct it, and tells when to stop trying to correct it.
- Why do some goods receipts and some invoices affect moving average price while others do not? For those that do, the degree of effect can vary widely. For most users, that effect is either unknown, or represents a mysterious lack of logic on the part of the system. This report pulls back the curtain for the reader, exposing the logic and the effect that it brings about.
- The meaning of the following error message is not clear to users: Moving Average Price for material is negative. This message also confuses most users with regard to when and whether or not the error is encountered. This report removes the confusion by explaining the functionality involved and the circumstances that determine when the error does and does not occur. It also provides options on how best to deal with the error when it does occur.
- Few users understand, and many misuse the MR11 transaction (Maintain GR/IR Clearing Account). Its depiction in PO history is counterintuitive and at odds with both its intended use and actual impact. This report provides the reader with an understanding of its purpose, its functionality, and the reasons to avoid its use.
I cover the following topics in this report:
- MR21 price change
- Goods receipts Mov types 101 & 505
- Goods receipt reversal (Mov type 102)
- Effect of a GR reversal on PO history (Three-Way Match)
- Conditional goods receipt (Mov type 103)
- Invoice reversals
- Subsequent debits or credits
- Credit memos
- MR11 (Maintain GR/IR Clearing Account)
- MB1C/561 & 562 Initial Entry of Stock & reversal (i.e., Pennies from Heaven and its Reversal)
- 561/562 On Split Valuated Materials
- MB1B Transfer/ 415 & 416 Plant Stock to Project Stock and its Reversal
- MB1B Transfers/415Q Project to Project
- Goods Issues against a Work Order (Mov Type 261)
- Goods Issue Reversal /262
- Price Control V or S on a WBS
- Error Message: “Moving Average Price for material is negative”
- MI07/701 & 702 - Gain/Loss by Inventory
I also include examples and Q&As to show you the logic behind system actions that may at first glance seem random. Examples include the frustration of not being able to get the value of the reversal of a goods receipt to match the original goods receipt value. Another is the confusion created by repeated unsuccessful attempts to get the goods receipt and invoice sections of the purchase order (PO) History tab on a PO to match.
In a standard SAP system, moving average price, as the term implies, is a value that changes automatically over time based on the value of individual postings for a material such as goods receipts (GRs) and invoices. For a long time, our materials management (MM) team thought that moving average price did not work at our project. We had been executing GRs and invoices on project stock, and then looking at the moving average price field on the material master to see the effect.
Not seeing any change, we decided that moving average price did not work in our particular SAP environment. However, I later realized that it does indeed work. We had simply been looking for the effect in the wrong area. The material master reflects only plant stock moving average price. We execute GRs and invoices against only project stock here (never on plant stock). GRs or invoices on project stock affect the moving average price on only project stock. Therefore, they do not affect the material master.
We did not realize that moving average price works separately for plant stock and project stock. (A circumstance that has an effect on the moving average price for a project stock has no effect on the plant stock price for that material and vice-versa.) In addition, the moving average price on project stock is calculated separately on each plant or work breakdown structure (WBS) for that material (just as material requirements planning [MRP] is for project stock).
The content in this report is based on findings in a system using largely standard SAP settings and moving average price as the method of price control specified in the material master. Specific IMG settings for automatic account determination and other areas may bring about slightly different results. The content also reflects the use of Financial Accounting (FI), Funds Management (FM), and Managerial Accounting (CO) as the financial structure. However, I believe projects using only FI/CO would react in the same or similar fashion.
Why Is Moving Average Price Important?
The SAP system uses the current moving average price to determine the value of certain transactions involving materials. These transactions include goods issues that establish actual costs for materials. Many transactions do not use moving average price, but rather establish or affect the moving average price whenusers execute them. Understanding how moving average price works allows you to understand changes to the values of specific accounts. Knowledge of these changes can be very important to auditors (internal and external) and therefore to you. This knowledge is also very important with regard to available budgets, including budgets for procurement of materials.
In a real-life example, a customer (highly upset) called me regarding the cost of a goods issue to a maintenance work order (MWO) on a specific project. The material involved was an inexpensive item priced at only $0.59 apiece. The goods issue was for a quantity of 250, thereby requiring a charge against the MWO and project of less than $150.00. Instead, the actual cost was $39,853.39. The discrepancy caused a problem with the budget for that project. It was discovered because the system prevented any further purchase orders (POs) from being created for that WBS due to payment budget exceeded errors.
Whether the SAP implementation is for an environment involving manufacturing, sales and distribution (SD), maintenance, or any other type that uses and incurs cost for materials, budgets cannot be managed effectively without an understanding of moving average price. For instance, in maintenance projects, the availability of funds for the repair of equipment is affected largely by the money spent on labor and materials.
The cost charged against an MWO for a material is a function of the current moving average price for that material multiplied by the quantity issued. If the moving average price is skewed, it can artificially reduce the budget money shown as available for the project. As with the preceding example, that can prevent the creation of POs until you identify the mistake and correct it. To find the cause of the error and fix it, you need to understand what can affect moving average price, what it in turn affects, and to what degree.
Finding the Moving Average Price
To see the current moving average price for plant stock and project stock, you have to look in a different place for each.
For the current plant stock moving average price, the moving average price is shown in the Mov. avg. price field of the material master on the Accounting 1 tab (Figure 1).
Directly entering or changing the price on the material master can be done only during creation of the record (transaction MM01). After you create and save the record, you need to use transaction MR21 to revise the material master price. You also can find the current moving average price for plant stock on table MBEW. Use table MBEWH for history on the moving average price. (However, it does not include the current period, only past periods.)
For the current project stock moving average price, use transaction MBBS. Add columns on the Results screen to display the moving average price and price control (Figure 2).
A list of results for the valuated sales order and project stock
Use the current display variant icon to access additional columns for display. The columns for moving average price and price control are on the right. You can also use table QBEW. Use table QBEWH for history on the moving average price by period. (Again, it includes data only for the past prices).
What Does and Does Not Affect Moving Average Price
The following transactions and events affect moving average price:
- MR21 price change
- Goods receipts/101 – valuated goods receipt and 505
- Goods receipt reversals/102 (frequently)
- Invoice reversals (potentially)
- Subsequent debits/subsequent credits
- Credit memos (rarely)
- MR11 – Maintain GR/IR clearing account
- MB1C/561 and 562 – Goods receipt other (also known as “pennies from heaven,” and its reversal)
- MB1B transfer/415 and 416 (915, 916 and Z15, Z16) – plant stock-to-project and its reversal
- Goods issue reversal /262 – Goods issue has no effect, but a reversal can affect moving average price
- Price control V or S
The following transactions and events do not affect moving average price:
- Goods issue to a work order/261
- Goods receipts/103 – conditional goods receipt
- MI07/701 and 702 – Gain/loss by inventory
- Deliveries (At my current project, we create or execute delivery orders only from plant stock, and the transaction uses the price on the material master and multiplies by the quantity involved (moving average price remains unchanged.)
Note that except for transaction MR21, the methods I discuss do not have any immediate effect on the moving average price unless they either create (put) stock on hand or already contain actual stock on hand in that type of stock (i.e., project stock or plant stock as applicable to what you are doing). The reason is because the system calculates the moving average price dynamically by dividing the total value of the on-hand stock by the total quantity of the on-hand stock. If there is no stock for that calculation, there can be no change to the moving average price.
The MR21 price change is almost always executed with the default settings. The most important of these settings is the Variant field. This field is on the follow-on screen to the initial screen and is set up by default to deal with stock material (i.e., plant stock) as shown in Figure 3.
The default setting for the MR21 price change variant
If you leave the Variant field in its default setting and enter the new price, the transaction changes only the plant stock moving average price, resulting in immediate changes to the material master and the price of any on-hand plant stock. The price change shows up on the change log in the material master. When you execute MR21 with the default setting, there is no effect on project stock.
However, the Variant field is changeable. The field has a drop-down menu with additional choices (Figure 4):
- All Materials
- Special Stock - Sales Order
- Special Stock - WBS Element
Variant field settings
The settings labeled All Materials and Special Stock - WBS Element can both change the project stock price. If you select either setting, the screen changes to include a field to specify the WBS number. By entering a WBS, the moving average price is directly changed for that (and only that) specific project stock line. This change also immediately changes the value of all on-hand materials on that WBS in that plant (regardless of in which storage location they are). With these selections, no change is made to plant stock or the material master.
It is important to note that no materials management (MM) movement type is associated with transaction MR21. No material document is created. Therefore, you can’t use transaction MB51 to find the price change. Because these two selections for the Variant field do not change the plant stock, you won’t see the change in the material master either.
The only way to find the actual transaction or occurrence of the price change via MR21 to project stock is to use transaction MR51 (accounting documents for material) to search for the actual price change document. Enter the Material number, the Valuation Area, and relevant dates. Click the drop-down in the Document Type field and select PR (Figure 5). Click the execute icon .
The initial screen for MR51
On the results screen double-click the Accnt. Doc number. On the subsequent Doc Overview screen click the header icon. Now double-click the value in the Reference key field. This action provides you with the actual Price Change document showing the WBS involved. Both the old and new moving average price of the material (shown in the table at the bottom of Figure 6) appear. Although this report does not include the actual screen, it is essentially the same as the screen shown in Figure 6 except that the actual screen also shows the total change in value (up or down) of the stock on hand at the time.
Price Change document with old and new moving average prices shown
When used to change the plant stock price, MR21 can also skew the outcome of a report on plant stock balances. MR21 changes not only the value shown on the material master but also the value of all plant stock inventory quantity currently on hand. However, it does not change the value shown on the constituent movements that brought about the plant stock quantity currently on hand. Although the totals shown in transaction MC.5 - Storage Location Analysis (for plant stock) and table MBEW (Material Valuation) match the total of the movements shown in MB51 (Material Document Movements) before the price change, they are out of sync after the price change.
Whether movement types 101 and 505 affect moving average price depends on which account assignment category is used on the purchase order. Only GRs that create inventory can affect the moving average price. The only account assignment category used at my current project that creates inventory is Q (i.e., Project Stock Make-to-Order). GRs for POs with an account assignment category of Q have a direct or proportionate impact on the current moving average price of that material or WBS (used on that PO). The system adds the GR quantity and value to the stock already on hand and then recalculates the moving average price. The GR establishes the moving average price if there was none already on hand.
The hypothetical GR just mentioned has no impact on the project stock moving average price for the same material on any other WBS. This GR also doesn’t affect the plant stock moving average price for the same material. Account assignment category K (Cost Center), I (Internal Order), F (Order), and P (Project) are consumption account assignment categories. They produce no inventory and thus have no impact on moving average price.
After you execute a 101 goods receipt and you determine that the receipt was posted in error (e.g., the wrong material number or the wrong storage location was entered), you need to execute an additional receipt using movement type 102 to reverse the effect of the original GR.
Mind your Ps and Qs here so to speak regarding account assignment categories. P and Q are not the same. Both do indeed procure materials for a project, but again, materials obtained on a PO using P as the account assignment category are consumed (i.e., expended) upon receipt. The Q, however, actually creates inventory on the project stock line for the WBS included on the PO. A blank account assignment category also creates inventory, but that is used for real stock (i.e., plant stock). At our project, we do not execute receipts of plant stock.
A GR reversal often changes the moving average price because the system does not use the moving average price to determine the dollar value of GR reversals. Under normal circumstances, the system uses the dollar value of the original GR. Because moving average price is dynamic, it is often different from the price created when the original GR was entered by the time the reversal occurs. Therefore, a GR reversal changes the moving average price any time the reversal dollar value per item is different from the current moving average price.
Because the system normally values the GR reversal the same as the value of the original GR, that is the dollar value that the system charges against the stock account when you execute the GR reversal. The system recalculates the moving average price to its new amount after the reduction in quantity and value brought about by the reversal. (Conceptually, this is clear.)
However, there’s a catch. This is only true if:
- No invoice is posted
- An invoice is posted, but with same value as the GR
- An invoice has been posted and then reversed
In other words, whether the GR reversal is given the same value as the original GR depends completely on the invoice circumstance. If you post an invoice (even one for partial quantity) with a different price per item from the price listed for the GR, and that invoice is still in place (i.e., not reversed before the GR reversal is executed), the value of the GR and GR reversal is always different.
The degree of effect on the moving average price depends largely on the value of the GR reversal. However, it also depends on how much of that value is charged against the stock account. (It’s not always the entire amount of the GR reversal.) Determining that amount is easy – just look at the accounting document created by the reversal.
Understanding why the system chose this as the amount to charge against the stock account can be a very different matter because it is affected by a couple of variables. To limit the confusion, let’s ignore the moving average price for a moment and concentrate instead on how the system determines the dollar value of the GR reversal itself when an invoice with a different price per item is still in place.
GR Reversal Value
Consider two quantity circumstances as examples: a full quantity and a partial quantity invoice:
- A full quantity invoice: When you post this invoice, the system makes an accounting adjustment to the value of the stock account because the invoice has a different price per item from the GR price per item. (See the later section on invoices for details.) Therefore, the concept in this case is as follows: The system disregards the GR and uses the value of the invoice as the value of the GR reversal. In other words, because the system already made that adjustment previously, if it used the value of the original GR here, it would be compensating for the difference twice (that’s why it ignores the GR here).
The system captures the information from all transactions associated with GRs and invoices for a PO and records this data in the Purchase Order history. Figure 7 shows a view of the historical record that results from this scenario. First, the original GR is shown by the row with movement type (Mvt) 101 and a value of $9.00. Chronologically, the invoice was posted next for $45.00 (represented by the row labeled IR-L). Finally, the user reversed the GR (Mvt 102). Because the invoice was still in place at the time of the GR reversal, the system bases the value of the reversal on the invoice value. Thus, the 102 GR reversal is valued at -$45.00 rather than -$9.00.
GR reversal value with invoice still in place
- A partial quantity invoice: Again, when the invoice was posted, the system also made an accounting adjustment to the value of the stock account to compensate for the difference in price per item on the invoice compared with the previously posted GR. However, in this case, it was a lesser amount because it was compensating for only the partial quantity on the invoice. When the GR is reversed, to establish the value of the reversal, the system uses the invoice price per item for the portion of the GR quantity covered by the invoice, and the GR price per item for the remaining quantity of the GR.
Consider this example. A GR is posted for 10 at $0.87 each for a total GR value of $8.70. An invoice is later posted for 5, but at a higher price per item: $1.00 each for a total invoice value of $5.00. With the invoice still in place, the user reverses the GR. The system calculates the full quantity of 10 in the reversal. However, it figures 5 of the 10 at $1.00 each and the other 5 at $0.87 each. So the total value of the GR reversal is -$9.35 (not the original GR value of $8.70).
Regardless of whether the invoice is for full quantity or partial quantity, if that invoice is still in place when a GR reversal is executed, you need to understand this concept: If the invoice was at a higher price per item than the GR, then the GR reversal value is greater than the original GR value – and vice versa. The bottom line: Reverse the invoice before the GR reversal.
Portion of Reversal Charged to Stock Account
Now for how much of the GR reversal value (what portion of it) is charged to the stock account. (Remember, this is if the differing value invoice is not reversed first.) As stated earlier, the easy way to determine this is to review the accounting document that the GR reversal created.
Only a few things affect the document that the GR created.
Question: Is the quantity on hand a variable here?
Answer: No, not with regard to how much of the GR reversal value is charged to the stock account. There is either enough quantity for the system to allow the reversal to occur or there is not. The system disallows a GR reversal for a quantity greater than the quantity on hand (i.e., the system does not allow a partial quantity reversal. It’s the entire line-item quantity or nothing).
Question: Does it matter whether the invoice dollar value is higher or lower than the original GR value?
Answer: No. That certainly matters with regard to both the direction and amount of the difference between the original GR value and the GR reversal value, but either way, the GR reversal can cause a change in the value of the stock account only in one direction –down. That does not mean that the moving average price always goes down, only that the total value of the stock account does.
Question: Does it matter whether the invoice was for full quantity rather than partial quantity?
Answer: No. This too only affects the size of the reversal itself – not how much of that affects the stock account.
So what’s left? You need to focus on two issues pertaining to the current stock account dollar value:
- Was the current stock account dollar value enough to cover the GR reversal dollar value? (The stock account can’t be charged more than it has in value. If its current total value is less than the GR reversal value, the stock account is reduced to zero, and the remainder of the reduction is charged to one of the loss type accounts. In that case, any remaining on-hand quantity has a moving average price of $0.00.)
- Was the current stock account dollar value already literally at zero before the GR reversal, even though there was sufficient quantity on hand? If so, different accounts would be affected, possibly even the plant stock account (also referred to as the warehouse fund). If the project stock account value was already at zero, its value is not affected by the reversal. Consequently, the moving average price stays at what it was as well – zero. If the stock account still has quantity and value after the impact of the GR reversal, the system divides the new total value by the new quantity to establish the new moving average price.
PO history is somewhat of a different subject than the moving average price, but worth discussing because the History tab on the PO is what everyone looks at (and many users become confused when they view data in this tab). When users execute a GR reversal, they expect to see it shown with the same value as the GR itself on the PO History tab. When that occurs, the math on the GR history balances out to zero. That’s a great result. The user can start over – no problem or confusion exists.
However, as I explain in the previous section, this is not the case if the invoice is posted for a value different from the GR, and that invoice has not been completely reversed via an actual MR8M transaction or a full quantity credit memo within the MIRO transaction.
A subsequent credit for the entire amount of the invoice does not suffice to remove the invoice. That is not a reversal of an invoice. It is simply changing the value of the invoice to a lower one. Even if a subsequent credit for the full invoice amount were executed, the system would still consider that an invoice had been posted, and that the material was literally free. Unless the original GR was also free, that would confuse things on the PO History to an even greater degree.
When the GR and the GR reversal are posted with different values, the GR history shown is not zero, and it’s no longer simple. When that occurs, it affects (from a visual look at the PO History perspective) the three-way match between the PO line-item price/GR price, or invoice price. That can create a very confusing circumstance to the user responsible for ensuring that these prices all match each other. Usually, they make it worse trying to get them to match each other.
In the previous section I explain how the system determines the dollar value of the GR reversal (i.e., on what it bases that value). I restate the basic concept here in a different way: If the GR and the invoice are for the same quantity, and the invoice is still in place, then the GR reversal value shown is the same as the invoice value (plus or minus the value of any subsequent debits or credits). There may be an exception to this, but if there is, I have never seen it. (Refer to the previous section for the effect of partial invoices.)
Technically, the reversal value shown on in the PO History tab represents the amount charged against the GR/IR account for the reversal. This value also represents the countering entry to the project stock account or the price differences account. (The price difference account comes into play in circumstances such as the value on the stock account not being sufficient to cover the reversal.)
The consequence of the preceding scenario is a zero total quantity shown for the goods receipts section in the PO History, but with a total value that is not zero. (The PO History is simply showing the math result for valuation on the goods receipt side.) The users see this, and often try to fix it by posting a cancellation of the 102 GR reversal (i.e., reversing the reversal – which results in the system posting a 101 GR in the background), or manually posting another 101 goods receipt.
Users often continue through many attempts (sometimes very many) – but always to no avail. They still have the mismatch between the GR total value and invoice total value, or a GR total quantity of zero with some dollar value (negative or positive), as shown in Figure 8. This figure shows the effect of an original GR (101) for $9.00, an invoice for $45.00, and multiple attempts to reverse (102) and repost (101) the GR with the invoice still in place.
Effect of GR reversal on PO History (3-way match)
The resulting GR totals are: Quantity = 0, and $ Value = -36.00.
As long as that full quantity invoice is still in place, all 101 and 102 postings continue to be valued at the amount of the invoice (no matter what). It doesn’t even matter if the moving average price is manually changed with execution of an MR21 transaction or even if the PO line-item price is changed. The system still values any manual GR 101s, reversals, or reversals of reversals at the same price as the invoice.
Question: With PO History showing the quantity at zero, should the user try to get rid of the value shown for that zero quantity?
Answer: No. The system has made the correct postings as it is. Any problem is really only with the visual of the PO History. When that invoice with the value that is different from the GR is posted, the system immediately makes a posting for the difference against the project stock account. A careful review of the accounting documents for the invoice shows that this occurred. The accounting document labeled Cost accounting doc shows this activity. That posting against the project stock account actually changed the moving average price. So even though PO History seems to indicate that something needs to be done to correct an imbalance, the system has already made the correction. What looks like a problem on PO History is actually not a problem.
Question: Why does the system create or allow this confusion by showing the GR reversal value as being that of the invoice? Why doesn’t it use the value of the original GR?
Answer: The invoice value is the only remaining value of the original GR. As stated above, the difference between the GR and the invoice is already dealt with (in terms of the stock account) when the invoice is posted. Therefore, the invoice value is all that is left to deal with. So that is the correct value of the GR reversal. If the system used the full amount of the original GR as the value of the GR reversal, it would be dealing with (correcting) the amount of the difference a second time. That truly would create an accounting mismatch or error. Any manual attempt to change the GR portion of PO History is unnecessary. The result is artificial at best, and makes it worse behind the scenes. I recommend that you live with that value on the PO History as it is.
Some people may advise posting an MR11 transaction (Maintain GR/IR Clearing Account) in this circumstance. I don’t agree. The system would allow an MR11 to execute in this case because there is (at this point) a difference between the quantity invoiced and the quantity received. However, this is not the circumstance that an MR11 is intended to correct. An MR11 does not cause that existing dollar value for the quantity of zero to go away. It shows a posting of the quantity involved, and shows that quantity with a value of zero. (Visually, that is not even shown in the GR area of PO History. It is shown in PO History between the GR area and the invoice area.)
More important – from an accounting point of view, even though the line in PO History shows zero value, in this case, the MR11 actually adds value to the stock account (with no increase in quantity on hand). It incorrectly increases the moving average price and still does not make the PO History look any better. I think it is as if you are forcing the balance on a checkbook for all the wrong reasons. (See the section labeled “MR11 Maintain GR/IR Clearing Account” for an explanation of what MR11s are for, how they work, and what the system uses to determine the dollar value.)
Question: I still have zero quantity received, but with a value. What is the best approach here?
Answer: Well, first – even now – reverse the invoice. Then, if the PO line-item price is not correct, change it so it is. Then, you need to get the inventory back on hand, so post a GR. This time the system uses the price on the PO line item (because the invoice is gone now). Then repost the invoice. The system suggests the new GR price as the invoice value Use this price. The PO History totals for GR and invoice still do not match, but the accounting is correct. Leave it as it is at this point, and move on.
Without a doubt, the best way to avoid the apparent mismatch (and the incredible confusion that can follow in trying to fix it), is to reverse the invoice with transaction MR8M (and nullify any subsequent debits or credits with opposite postings) before executing the first GR reversal.
A 103 Conditional GR (movement type 103) does not affect the moving average price. This is a conditional receipt intended only to document that the material has arrived and that it is in your possession. However, it’s either damaged or is the wrong material, and you accept no liability to the vendor. No quantity is posted on PO History, and no inventory is created. Therefore, no charge to the stock account occurs, and there is no impact on the moving average price
Invoices are similar to GRs in that their impact on the moving average price depends on the account assignment category of the PO. Like GRs, invoices affect the moving average price only for POs with account assignment categories that accumulate stock on hand (only account assignment category Q or Blank at projects with real stock). Even then, the stock must be on hand when the invoice is posted or the invoice still has no effect.
The information below assumes that a GR has already been executed for the specific PO that the invoice is for, and that GR has not been reversed. An invoice executed without a GR having been posted (i.e., the GR-based IV check box on the PO was not checked), or with a GR posted but then reversed, has no impact on the moving average price, even if the project stock account already has quantity on hand and value. This may seem surprising or even counterintuitive, but it is true because an invoice cannot create inventory itself, and does not affect inventory price or value until the material it is billing for is received into inventory for the PO and the WBS that ordered it. The system does not try to determine if any quantity of the same material for the same WBS exists in inventory and increase the value of that project stock.
Most POs do have the GR-based IV check box on the Invoice tab checked. The system responds by preventing an invoice from being posted until a GR exists (at least a partial receipt). Invoice tolerances can also be established at the system level to limit the invoice quantity to the quantity received. In a standard SAP system, though, once a GR for any quantity exists, the entire PO quantity can be invoiced.
By design, the system does not use the current moving average price for valuating invoices. When the invoice is executed (via MIRO) and the PO number involved is entered, the system suggests or defaults to the quantity and price from the GR. If the invoice is posted with that suggested quantity or price, the invoice has no impact on the moving average price. The GR has already established the impact for that quantity or price.
However, the invoice transaction MIRO allows manual entry or change of both quantity and price. (This is standard SAP functionality because the vendor’s actual bill sometimes varies from what you expect.) If an invoice is posted with a price per item that differs from the GR, the invoice absolutely affects the moving average price. The invoice impact trumps the effect of the GR. The GR affects the moving average price, but only temporarily – until the invoice is posted. Then it depends on the circumstances as to what happens:
If the invoice price per item is higher than the GR price per item, the invoice is for full quantity, and the total quantity is still on hand, the invoice price is not just averaged in with the GR price. The invoice in effect replaces the GR impact completely. It is as if the system says, “OK, you must have thought the price was going to be $1.00 each when you posted the GR, but now we see by the invoice that it is actually $2.00 each. And we’re going to let the invoice have the final say.” The system overwrites the effect of the GR with the impact of the invoice as if the GR never happened. (Although the system actually just adds the $1.00 each increase to the $1.00 each value established by the GR, the effect is as if the invoice replaced the GR.)
The preceding explanation applies only if there is stock on hand when the invoice is posted. If a GR is made, and the goods issue of that material or a transfer occurs before an invoice for a higher dollar amount is posted (leaving the on hand quantity at literally zero), the invoice does not affect the moving average price. The system leaves the stock account charged with only the original amount shown on the GR and posts the rest of the higher invoice amount to a price differences account, thereby leaving the moving average price as it was before.
Concept: Some transactions or movement types put stock on hand (i.e., they create inventory) such as goods receipts or movement types 561 (goods receipt other or pennies from heaven) or 415 (transfer plant stock to project stock). These affect the moving average price even if no stock existed on hand prior to their execution. However, transactions that do involve price, but that do not put stock on hand can only change the moving average price if there already is stock on hand on which to change the price. Examples are invoices and subsequent debits.
If the invoice is for a greater (or lesser) quantity, but the price per item is still the same (as it was on the GR), then posting the invoice changes neither the moving average price nor the total value. You might think that with an invoice for a greater quantity, the total value on the stock account would increase, and that the moving average price would therefore increase. However, that is not what happens. The quantity on hand is still what the GR brought in. (As stated earlier, the invoice does not add or remove inventory quantity.)
Instead, the system says the following: “Ok, you GR’d a quantity of 4 at 1.00 each. You then invoiced a quantity of 8 at 1.00 each. I (the system) still have an actual quantity of 4 on hand, and since the price on the invoice is still 1.00 each, none of that invoice charge for the additional quantity is going to be posted to the stock account. Its total value is still 4.00. I hit only two accounts for that invoice – the GR/IR Clearing Account and the Vendor Account (debiting one and crediting the other for offsetting amounts). I always do that when it’s a quantity difference, but with the same price per item. You and your vendor should discuss this and decide whether another GR is going to be executed for the other four, or if a credit memo for a quantity of 4 is going to be needed instead.”
The same principle applies for an invoice with the same price per item, but a lesser quantity. However, if the invoice is for both a greater quantity and a greater price per item (than the GR), then it gets a little more complicated. Instead of only the GR/IR and vendor accounts being debited and credited for equal amounts, the project stock account and the price differences account are also involved (and not for equal amounts). It seems logical that these are the accounts affected consistently, but how much goes to the GR/IR account, how much goes to the stock account, and how that affects the moving average price can appear to be utterly random. However, it is not. There is logical method to the madness. The below example demonstrates that logic.
The circumstance: Zero quantity of a material exists initially.
A GR is posted for a quantity of 2 at $1.00 each. Total value of GR = $2.00, total value of stock account = $2.00, total quantity on hand = 2, moving average price = $1.00 each.
An invoice is then posted for a quantity of 3 at $2.00 each for a total invoiced value of $6.00.
The system uses two separate calculations in the accounting for the invoice. One determines how much of the invoice value affects the GR/IR account. (In this circumstance, it is not all of it.) The other calculation is used to determine how much of what’s left affects the stock account. (In this case as well, it is not the entire amount.)
Here’s what the system did: The vendor account = -$6.00 (total value of invoice). The GR/IR account = +$4.00. Why? The system determines the difference between the GR price per item and the invoice price per item. It then multiplies the difference by either the GR quantity or the invoice quantity, whichever is the lower of the two. In this case, that’s the GR quantity. The difference between GR price per item and invoice price per item is $1.00 each. That difference value times the quantity received (2) equals $2.00. That is the portion of the invoice value that does not affect the GR/IR account. The amount that is posted to the GR/IR is $4.00.
That leaves $2.00 of the invoice value that has to be posted somewhere to finish offsetting the amount that went to the vendor account. It does not all go to the stock account because even though the full quantity of the GR is still on hand, the full quantity of the invoice is not. Therefore, the system divides the $2.00 in proportion to the quantity on hand (i.e., it sets up a ratio of the quantity on hand compared with quantity invoiced). Although the GR quantity can come into play on the first calculation, it is not considered on this (the second) calculation. Even if the GR quantity is less than the invoice quantity, the on-hand quantity is always compared with the invoice quantity.
- Therefore, the stock account = $1.33 (i.e., quantity two of the three invoiced are actually on hand, so the system applies two-thirds of the $2.00 to that account.)
- The price differences account = $0.67 (i.e., the remainder of the $2.00)
- The $1.33 is added to the previous stock account value of $2.00 to make a new total value for the stock account of $3.33. With a quantity of two on hand, that made the new moving average price $1.67 each.
The next example shows the same accounts affected and, in my opinion, shows the same logic at play regarding the amount charged to GR/IR and to the stock account. The circumstance: Zero quantity of a material exists initially.
A GR is executed for a quantity of three at $3.00 each. Total value of stock account = $9.00, moving average price = $3.00 each. Two were then issued, so only a quantity of one remains on hand with moving average price still at $3.00. Then an invoice is executed for a quantity of nine at $5.00 each for a total invoiced value of $45.00.
Here’s what the system does: The vendor account = -$45.00. The GR/IR account = + $39.00. Why? The difference between GR price per item and invoice price per item is $2.00 each. Again, the system multiplies that by the lower of the GR and invoice quantity (in this case, the GR quantity). That difference value ($2.00) times the quantity received (3) equals $6.00. That is the portion of the invoice value that does not hit the GR/IR account. The amount that is posted to the GR/IR is $39.00.
Notice that for this calculation, the quantity on hand is ignored. That’s because the system is determining how much to charge the GR/IR account – (not the stock account) – so the GR quantity is what’s in play.
That leaves $6.00 of the invoice value that has to be posted somewhere to finish offsetting the amount that to the vendor account. Remember, the system has another calculation to determine how much of that $6.00 goes to the stock account. Now the quantity on the stock account is pertinent, and the GR quantity is ignored. If (as in this case), the quantity on hand is less than the quantity invoiced, the full $6.00 does not go to the stock account. Again, the system sets up a ratio of quantity on hand (one) compared with quantity invoiced (nine) to determine the amount with which to change the value of the stock account.
That ratio is 1/9. That means one-ninth of the $6.00 remaining (i.e., $0.67) went to the stock account. The $0.67 is added to the current stock account value of $3.00 to make a new total value of $3.67. With a quantity of one on hand, that makes the new moving average price $3.67 each. What about the rest of the $6.00? The remaining $5.33 is charged to the price difference account.
These examples are important for understanding the effect on the moving average price in this invoice circumstance. They explain the how and why of the accounting. If you run into one of these, keep the following in mind:
The bottom line on invoices with greater quantity and greater price per item: To figure out the effect on the moving average price easily – just review the accounting documents and see how much went to the stock account. That amount would be added to the total value that was previously there. The system would then recalculate the moving average price with that new value divided by the (unchanged) quantity. If you determine later that the invoice was incorrect in quantity, price, or both, don’t try to fix it with a credit memo or subsequent debit or credit. That approach is certain to create a web of complexity and confusion that cannot be overstated. Instead, to fix an invoice like this, make sure there is enough quantity on hand to cover the invoice quantity (reverse the goods issue if the material is already issued). Then simply reverse the whole invoice with an MR8M transaction and start over.
If the invoice price per item is lower than the GR price per item, (regardless of whether the invoice quantity is higher or lower than the GR quantity), how moving average price is affected again depends mostly on the quantity still on hand when the invoice is posted. If nothing else has caused a change in moving average price between the time of the GR and the invoice, the following applies:
- If full quantity is on hand (and the GR and invoice are for the same quantity), the system simply reduces the total value of the stock account by the amount the invoice is lower than the GR. The system recalculates the moving average price by dividing the new lower total value by the same quantity as before. The new moving average price is thus proportionately lower.
- With partial quantity on hand, the system reduces the stock account value, but in this case, only by the amount of difference proportionate to the quantity on hand compared with the quantity invoiced. The ratio of on hand quantity or invoiced quantity applies here, too.
For example, a GR is posted for a quantity of 3 at $30.00 each. Total value = $90.00, (moving average price = $30.00 each). Then a goods issue is posted for one leaving a quantity on hand of two. The total value is now $60.00 (moving average price still is at $30.00 each.) An invoice is then posted for a quantity of four, but at a value of $3.00 each, or a total invoice value of $12.00. The difference between the GR price per item and the invoice price per item is $27.00 each. This difference times three (lower of the quantities for GR and invoice) = $81.00. Since there are only two on hand at the time, the ratio of on-hand quantity to invoice quantity is two-fourths, or half the $81.00. (Remember, the GR quantity is not involved in this part.) The system only reduces the $60.00 stock account value by $40.50. The other $40.50 of the $81.00 difference is posted to the price difference account. The new total value of the stock account is $19.50. The new moving average price for the two on hand is $9.75 each.
With zero quantity on hand the end result is no change to moving average price. The system can only recalculate the moving average price if there is stock on hand.
Potential Error Message
If the current total value of the stock account is so low that it is less than the amount that the system would need to reduce the stock account, and there is any quantity on hand, the system disallows the invoice and provides a hard error message, “Moving average price for material is negative.” The system is not saying here that the moving average price is already negative. It is saying that it would be negative if the system were to allow the invoice to post. The system prevents that from occurring.
You can use three methods to force the system to allow the invoice to post:
- Preferred method: If a goods issue has been executed, reversing it usually puts enough quantity/value on hand to allow the invoice to post. This is the preferred method because it also means that when the goods issue is reposted afterward, the system uses the new, lowered moving average price to establish the value of the goods issue transaction. That means it will more accurately reflect the actual cost to the work order.
- Acceptable method: Use MR21 to change price on the material/WBS such that the total value of the project stock account is higher than the amount of the reduction to the stock account. (The price can then be changed back again if desirable.) Then execute the invoice.
- Acceptable method: Temporarily issue all the material quantity on hand to an MWO on this WBS. Now execute the invoice, and then reverse the goods issue. (The explanation on why this is allowed follows below.)
- Least preferable method: Use transaction MB1C/561 Q – Initial Entry of Project Stock (also referred to as “pennies from heaven”) to temporarily place enough stock on the project stock line to increase the stock account value to cover the reduction amount. Post the invoice, and then reverse the 561 Q (“pennies from heaven”) with a 562 Q (i.e., heaven took it back) to re-establish the original inventory quantity.
- Any other method that would either result in stock being on hand at a total value high enough to cover the reduction in stock account value created by the invoice, or that would remove the stock on hand completely.
For a complete explanation of when this error message occurs, see the later section labeled “Error Message: “Moving Average Price for Material Is Negative.” Although the system prevents the invoice posting in the circumstance resulting in this error message, there is an exception to the rule. If there is literally zero stock on hand, the system does allow the invoice to be posted. In that case, automatic account determination is set up to simply post the reduction to the price difference account. The above error therefore does not occur.
Using the previous example, if all three of the quantities received had been issued leaving zero quantity on hand when the invoice was posted, the system would post all the $81.00 difference to the price difference account, and would not recalculate the moving average price. Table QBEW would show zero for both total quantity and total value, and would still show moving average price as $30.00 ea. (Although the invoice in this case certainly affects the vendor account, it has no effect at all on the stock account.)
Realistically, though, the $30.00 moving average price is somewhat meaningless since there is zero quantity on hand. As soon as a transaction occurs that puts quantity on hand, the system would completely ignore the $30.00 moving average price and calculate a new one from scratch based on that new transaction.
Another way to look at part of this: If an invoice is posted for a lesser quantity than the GR covered, and the invoice is for a lower or higher price per item and the full receipt quantity is still on hand, the invoice affects only that portion of the total quantity that it included. The GR still controls/affects the moving average price of the quantity not covered by the invoice.
For example: Let’s say you perform a GR on a quantity of 10 at $5.00 each for total value of $50.00. If none were on hand before, the moving average price is $5.00 each. You then invoice a quantity of 1 of those items for a value of only $1.00. The system recalculates the moving average price. It replaces the GR value of 1 of the 10 at $5.00 with the invoice value of $1.00, so the total value is reduced from $50.00 to $46.00. Total quantity is still 10 on hand. The system calculates the new moving average price as $4.60.
Reversals of invoices behave exactly like the invoice itself does as far as the impact on the moving average price goes. Just as with invoices, invoice reversals do not change the quantity on hand. Reversals of invoices on POs with consumption type Account Assignment Categories have no effect on moving average price. The system does not use the current moving average price to valuate the reversal; it uses the value of the original invoice.
The degree to which the moving average price is affected depends completely on the quantity on hand at the time of the reversal. The direction of the effect (up or down) depends on whether the invoice price per item is higher, lower, or the same as the GR.
If the full invoiced quantity is still on hand, (and the total value of the stock account is sufficient) the value of the original invoice is taken away from the total value the system shows for that stock account (in table QBEW). It is replaced by the dollar value of that quantity from the GR.
Note that replacing the invoice value with the GR value for the same quantity is only meaningful to the moving average price if the price per item on the GR and invoice are different. If they are the same, there is no impact to the moving average price at all. However, if they are in fact different, upon reversal of the invoice, the system reestablishes the GR as the controlling price for that particular quantity, and then recalculates the moving average price by dividing the new dollar value by the total quantity. The moving average price would go back to what it was before the invoice (or to what it would have been without the invoice if other movements have changed the moving average price in the time between the execution of the GR and the invoice).
As with the original invoice, invoice reversals may result in the hard error message “Moving average price for material is negative.” There must be stock on hand for this error to occur, and the current total value of the stock account must be less than the amount by which the system would have reduced the stock account for that quantity. However, the system does not always reduce the stock account by the full dollar value of the invoice reversal. For a complete explanation, see the later section labeled “Error Message: Moving Average Price for Material is Negative.”
Again, (although it may seem strange), if there is zero quantity on hand, the system does not invoke the error, and instead allows the reversal to post. In that case, automatic account determination functionality is set to simply apply the entire reduction to the price differences account. The system accepts that, but does not allow the project stock account to have a negative value/moving average price.
If only partial quantity is on hand, the reversal of the invoice affects the moving average price much differently. For example, a quantity of 1 already exists on hand with a total value and moving average price of $3.00 (in table QBEW). A GR is executed for a PO of quantity 3 at $3.00 each for a total GR value of $9.00. Total quantity on hand is therefore now 4, the total value of the stock account is therefore now $12.00, and the moving average price is still $3.00.
An invoice is executed for a quantity of 3, but at $10.00 each for a total invoice value of $30.00. The system (in effect) replaces the $9.00 GR with the $30.00 invoice. So, the total value of Stock Account in table QBEW is now $33.00 ($3.00 previously there, plus the $30.00 invoice). The quantity is still 4, so the moving average price is now $8.25.
A goods issue is then executed for a quantity of 3 (3 at $8.25 ea, so the value of the goods issue is $24.75). The total quantity left is 1, the total value is now $8.25, and therefore the moving average price is still $8.25.
Now completely reverse the invoice (that had been for a quantity of 3, at $10.00 each for a total invoice value of $30.00). The accounts impacted are the vendor account and the GR/IR account. The accounting works out as follows: The vendor account is debited (the liability to the vendor is reduced) by $30.00. The GR/IR account is credited by -$9.00, which is the value of the original GR and therefore the amount posted to the GR/IR account from the original invoice. The GR quantity affects the GR/IR posting. On hand quantity affects the stock account posting.
That leaves $21.00 of the $30.00 that still has to be applied somewhere to balance out the amount that hit the Vendor Account. However, there is only 1 of the quantity of 3 left on hand (one third of the invoice quantity). Therefore:
- Stock Account: -$7.00 (system applies one-third of the $21.00 to the stock account)
- Price Diff Accnt: -$14.00 (system applies the remainder of the $21.00 here)
The $7.00 is subtracted from the previous total value in table QBEW of $8.25. That leaves table QBEW showing the stock account with a quantity of 1, total value of $1.25, and the moving average price = $1.25.
If there is no stock on hand (zero quantity), the reversal of the invoice is ignored in terms of the moving average price. The moving average price simply stays as it was before the reversal. (Accounting documents are still created – but as stated above, the full value of the reversal is applied to the price difference account, with nothing applied to the stock account.)
Subsequent debits and credits simply revise the degree of the effect of an invoice. A subsequent debit or credit can only be done for (and in reference to) an invoice that was previously executed (thus the term “Subsequent”). It cannot stand on its own. Therefore, it simply changes the dollar value of the invoice it pertains to. It does not change the quantity. The quantity of the related invoice is still as it was. The change in invoice price is expressed in terms of the whole amount, not the amount per item.
The system increases or decreases the total value of the stock account by the value of the subsequent debit or credit (as applicable). The system uses that new value in the recalculation of the moving average price which is revised accordingly.
This too though is only if there is still stock on hand. Even if there was stock on hand when the invoice was posted, if that stock is issued before the subsequent debit/credit is posted, there is no impact on the moving average price. Here too, the accounting document for the subsequent debit/credit would simply show the up or down dollar value posted to the price differences account.
If there is partial quantity on hand at the time of the subsequent debit or credit, the system raises or lowers the moving average price of the material proportionately.
A credit memo is a type of invoice reversal (and therefore, you can’t post one unless an invoice already exists).
A credit memo and transaction MR8M (Cancel Invoice Document) are different only in that an MR8M can only be used to reverse the entire invoice, while a credit memo can be used either to reverse a portion of an invoice or to the reverse the whole thing.
A credit memo is used to correct an invoice that was posted with the correct price per item, but with the wrong quantity.
Quantity is always involved in a credit memo – not the quantity in inventory, but the excess quantity invoiced. Let’s say that the vendor physically sent you a quantity of 5, and you GR’d that quantity of 5 at $4.00 each. Then the vendor invoiced you for a quantity of 8 at $4.00 each, and you posted the invoice that way. As soon as you realized the mistake, to correct it you’d do a credit memo for a quantity of 3 at $4.00 each, $12.00 total. (You would not do that if the quantity on the original invoice is correct and only the price is wrong. In that case, a subsequent debit or subsequent credit would be the appropriate correction method, not a credit memo.)
The following question might arise: If both quantity and price per item on the original invoice are wrong: Can I correct both with a (single) credit memo? (Or, do I have to execute the credit memo to correct the quantity invoiced, and then do a subsequent debit or credit to correct the pricing?) You could actually do either, but I recommend neither.
Take this advice instead: Make sure the full quantity involved is still on hand (i.e., reverse the goods issue if necessary to bring that about). Then simply reverse the whole invoice and repost it correctly. Otherwise, it’s likely that you’ll be in for a lot of confusion, complexity, and work.
I am not a big fan of the use of transaction MR11; largely because many people who execute it do not understand what it is intended for nor what it does to accomplish that intent, and therefore use it for the wrong reason. I am also not a fan because I think there are far better approaches available than the use of the MR11 even when it is executed for its intended purpose. The very nature of the transaction makes it deceptive to users.
The transaction deals with circumstances of difference in quantities received versus quantity invoiced on a PO. Some people understand that, but mistakenly take that to mean that executing it will cause the History tab on POs to then visually reflect a balance between GRs and invoices. Others mistakenly think that it will bring about an actual difference in quantity on hand. It will do neither of those. Its effect is only on the accounting side, and only behind the scenes.
An MR11 is used to make an accounting correction (the clearing of the GR/IR account) based on a difference in quantity existing between a GR and an invoice. The physical inventory side of that difference is totally ignored. The quantity difference is used only to determine the direction and the dollar amount of correction needed on the accounting side as a result of that difference. The transaction essentially “forces a balance.” I think that is seldom appropriate. In its most logical use, it is intended to compensate for a difference in GR and invoice quantity when the lower quantity of the two is correct. (It should never be used when the higher quantity is correct since an additional GR or invoice could easily correct that type of difference. The system wouldn’t correct in that direction anyway. All it can ever do is lower the effect of the higher of the two.) Even when the lower quantity is correct, I say a far better approach is to correct the underlying problem using reversals and re-postings rather than execution of an MR11.
An MR11 cannot be executed if the quantity of the GR and the invoice are the same, even if the dollar value of the GR and invoice are different. The value does not matter at all in regard to whether or not the system will allow an MR11 to be executed.
So what does an MR11 do/how does it work/how is its result depicted? An MR11 is executed against a PO. The PO can have any circumstance of difference between the GR and invoice for a line item. That could be a PO with an existing GR but with no invoice, an invoice with no GR, one of each but with different quantities, or several of each that result in a total difference in quantity. Let’s say the MR11 is executed on a PO that had an invoice and multiple GRs or a GR and multiple invoices on a single PO line item and a resulting difference between them in total quantity:
The system determines which particular GR or invoice is the offending document (i.e., which one caused the higher quantity posting), and the quantity difference that document caused/created and now needs to be corrected. The system determines the price per item involved in that particular document. It then determines the dollar value of the correction by multiplying that price per item times the quantity difference that the correction is for (not the necessarily the entire quantity on that particular document).
The system makes a correction to the GR/IR account in that amount and posts a corresponding, opposite correction to the stock account. The direction of the charge against the stock account depends on whether the correction was for excess GR quantity, or excess invoice quantity.
The system depicts the execution by inserting a separate line/section in PO History to show the correction. It is listed as AccM (for Account Maintenance Document) in Figure 9. This is not a material document like that shown for a GR. (Notice there is no material movement type shown beside the document number.) It is strictly an accounting document just as an invoice is.
This PO History line shows a quantity (with either a negative or positive sign), but always shows a value of $0.00. Note that this is one of the reasons many people are confused as to the intended purpose of the MR11. This depiction in PO History makes it appear that the correction is only to quantity with no effect on value, when in fact, (as explained above) it is only based on quantity. It has no actual effect on quantity in the stock account, but does indeed affect the stock account in terms of dollar value, even though the resulting line in PO History shows a value of $0.00. (Confusion is almost guaranteed for the average user.)
PO History after execution of transaction MR11
The system inserts the AccM line showing the number of the accounting document created, in this example 5800001143, as well as the Quantity and the value established by the system. The value is shown in the Amt. in loc. Cur column.
The quantity of 6 in Figure 9 represents the difference between the total GR quantity and the total invoice quantity involved. The negative sign is due to the invoice quantity in this case being higher than the GR quantity. When the quantity shown on the AccM line in PO History is negative (-), it means the system removed the accounting effect of excess invoice quantity and added money to the stock account as a correction. The transaction executes even if the current value of the stock account is zero.
However, there must be quantity on hand in the stock account for the posting to take place on the stock account itself. If the quantity on hand is zero at the time of the MR11, value is added to a price difference account instead of to the stock account.
As long as there was already quantity on hand in the stock account, this affects the moving average price - and always makes it higher. (It absolutely has to – every time – because it adds value to the account without adding inventory quantity.)
If the quantity shown on the AccM line is positive, it means that the MR11 removed the accounting effect of excess GR quantity. That means that the system took money from the stock account as a correction. (Remember, it does not remove physical quantity from inventory.) This affects the stock account value (and therefore, the moving average price) only if there is current value on the stock account (and therefore, there has to be quantity on hand as well).
As you might expect from the above, as long as there is stock on hand with value, this circumstance always makes the moving average price lower because it removes value from the stock account without reducing inventory quantity. However, the MR11 still occurs, even if the stock account has both zero dollar value and zero quantity on hand. In that case, the money again is simply charged against a price difference account instead of against the stock account value and therefore leaves the moving average price unchanged.
If there is only a partial quantity on hand on the stock account at the time, the dollar amount that the system adds to or takes from the stock account (depending on whether this is correcting excess invoice quantity or GR quantity) is proportionate to that quantity, and based on the price per item of the invoice or GR for which the MR11 is correcting.
Bottom line on MR11: Its purpose, functionality, and effect are not understood by most users. The quantity, negative/positive signs, and the zero dollar value shown in PO History are all counter-intuitive. This has a confusing rather than a clarifying impact on PO History. So why create the confusion?
For me, unless it is a very special circumstance that I can’t think of at the moment, I would much prefer to see (for example), a reversal of the invoice involved so that the incorrect GR could be reversed, and then the posting of the corrected GR, and the re-posting of the invoice. Those would be depicted in PO History in an unambiguous manner that all could understand, and inventory and accounting balances would be accurate with no forcing of balance.
Transaction MB1C is Goods Receipt Other. 561 is the movement type used with this transaction to put the initial inventory into the system. This is sometimes referred to as “pennies from heaven” since it is treated as if it’s free. Movement 562 reverses it.
If an MB1C/561 is executed in the normal manner, the system uses the current moving average price for that material to determine the value of the receipt. It uses the current plant stock moving average price for that material if the material is being put into plant stock. If putting it into project stock, the system uses the current moving average price for that material on the WBS into which it is being put. (If there is no project stock on hand on that WBS, the value would be based on the price on the material master.)
In this case, (normal execution), there is no effect on moving average price. After the transaction, the moving average price still is whatever it was before. (You simply have a greater quantity, but at the same price per item.) However, this transaction (MB1C/Movement Type 561 or 562) allows a user to manually enter the total value of the receipt if they want to (i.e., an externally entered price rather than the system entering it automatically).
It could be entered as a ridiculously high or low dollar value. In that case, the transaction has a proportionate effect on the moving average price of the material. On a 561, if zero quantity was on hand before, the moving average price is simply the total value of the receipt divided by the quantity. If there was already stock on hand, the effect on the moving average price is proportionate, just as it would be with any GR.
On a 562, you can even enter a value that is higher than the total value of the stock on hand. In that case, when the system recalculates the moving average price after the 562, it makes the moving average price $0.00. It does not let it go below zero dollars from a manually entered price on a 562. There may even still be quantity on hand with that moving average price of zero but the system does not show a negative total value or moving average price in that circumstance.
Transaction MB51 (Material Document List) provides information on movements of materials. The normal results display is very limited in the amount and type of information provided to the user. However, if the detailed list icon on the icon bar of the results screen is clicked, far more fields are made available for display via use of the Current Display Variant icon. The selection Amount LC (Amount in Local Currency) normally shows the value of movements (including 561/562).
However, if a price is entered manually as described above, that column only shows the value that would have been the result of the transaction/movement if the system entered the price automatically. (That also represents the amount actually charged against the stock account.) You have to also add the column labeled Ext. Amount in Local Currency to the screen display in order to see the manually entered value, and therefore, the actual total value of the transaction/movement. (Figure 10 shows the results screen [in detailed list mode] of an MB51 search for MB1C transactions with movement type 561.)
Material Document List
The figure includes the Detailed list icon to change the screen from the default display, as well as the Current Display Variant icon. The Amount in LC (Local Currency) and Ext. Amount in LC columns are also shown added to the default display. Most transactions do not allow manual entry of valuation price. MB1C is one of the transactions that do. Note: This value was enlarged for purposes of clarity.
I do not believe this would skew a report on plant stock Inventory Value. That report was created and executed on a quarterly basis at a project I worked on. It compared the total value shown in transaction MC.5 (Plant Stock by Storage Location) to the total of the values shown in Amount in Local Currency field/column on transaction MB51 for movement types that affect plant stock inventory. These values should match. Even if the report uses MBEW for the value rather than MC.5, it too shows zero rather than a negative value. As long as it is compared to the same field on MB51, the totals should match.
To manually enter the dollar value on a MB1C/561 or 562:
- Fill in the initial MB1C screen. On the next screen, enter the material number and quantity. Then while still on that second screen, click the magnifying glass icon. That brings up the Details screen (Figure 11).
- The system allows the Amount in LC (Local Currency) field to be used for manual price entry if the user so chooses. Otherwise, the value of the transaction is established by the system in the background based the current moving average price for that material (current plant stock price or project stock price as applicable).
Initial entry of stock with MB1C Goods Receipt Other
Enter the dollar amount in the Amount in LC field in the lower right corner of the Details screen. Click the save icon. The name of the field is somewhat confusing because it does not include the word Exact, but it is the correct field. The system calculates the moving average price with this factored in immediately. The same method applies to manually entering the price on the 562 movement.
If execution of a 561 or 562 includes manual manipulation of the dollar value on Plant Stock, you’ll actually see the effect on the material master itself (immediately). If it is executed on project stock, you’ll see the effect for that material on that WBS immediately in table QBEW. (In that case the material master/plant stock price would not be changed at all.)
One last point on movements 561 and 562 is that these are often inappropriately executed by users as an easy way to adjust inventory balances without having to go through the normal sequence of inventory transactions. Once users learn that a 562 removes inventory from the system, they tend to remember it. The next time they realize that inventory shown in the system does not physically exist, they may be tempted to say “Hey, we can do a 562 movement and it’ll be like the material never existed.”
Well, it is easier, and it does remove it from the system, but it is not a wise approach. MB1C/561 and 562 involve different accounts than those set up for inventory transactions. This means that accounting is ultimately skewed in the above circumstance. There will have been an actual goods receipt showing valid postings to accounts. Those will not be supported by anything logical that would expend or remove them from the system (such as a goods issue, a transfer to plant stock or to another project, or a loss by inventory adjustment).
Other than one exception that I describe in the next section, the only circumstance in which a 562 movement is appropriate is using it to reverse an incorrect 561. In other words, if the material did not get into the system via a 561, it should never be removed from the system by a 562.
Manual entry of the price on an MB1C/561 can be put to good use in one particular circumstance. That is to apply it to material masters (plant stock) for split valuated materials that were incorrectly set up with $0.00 for the price on the Parent. While the system lets you manually change the material master price with a MR21 transaction on the Children (the accounting views for the valuation types), it does not allow changing of the Parent price that way. (The system expects the Parent price to be changed only by movements [such as receipts or invoices] of the Children.)
In a project stock environment that does not execute goods receipts/invoices, for example, on plant stock, the $0.00 price on the Parent material master would stay there forever. This skews the planned cost on Maintenance Work Orders (MWOs) since that planned cost value is based solely on the price reflected on the material master. If the material is entered on the MWO without specifying a valuation type, it is the Parent price that is used for planned cost. (Zero is obviously not an accurate depiction of what the material will cost.) The only way I know of to get rid of that $0.00 for the Parent price on an implementation that executes receipts for that material only as project stock is with an MB1C/561/562.
Just execute an MB1C/ 561 on the material for a quantity of 1 treating it as plant stock (no special stock designation included). The system will require that you specify a Valuation Type. Choose any available type. It does not matter which one. Enter the dollar value that you want the Parent to reflect on the Details screen as explained above. (This is only a virtual temporary movement.) Once executed, the system accepts that amount as the new plant stock moving average price for the Parent and changes the material master accordingly.
Then immediately execute a 562 reversal for that quantity of 1 to get the inventory accurate. You don’t even have to manually enter a price this time. The system puts in what you just established as the moving average price with the 561 movement.
Even though there is no quantity left on hand, the material master continues to show this corrected price from that point forward instead of the zero price, unless, of course, someone changes it the same way. (Again, this is pertains to an implementation that only executes goods receipts and invoices for that material to project stock.)
The project I am currently on created custom movement types 915/916 and Z15/ Z16 based on standard movement types 415 (transfer from plant stock to project stock) and 416 (transfer from project stock to plant stock). This was for reasons involving QM inspection, auto creation of storage locations, and the Automated Data Collection (ADC) software we used at our project. In terms of moving average price, they function the same as 415/416.
In the case of movement type 415 (transfer from plant stock to project stock), the system uses the value from moving average price for plant stock and charges that to the WBS. If the WBS (project stock) price is different than the plant stock price, the project stock moving average price is affected up or down proportionately.
For example: The plant stock moving average price is $5.00 each. The Project has 6 on hand on one WBS with a total value of $60.00 (moving average price = $10.00 each). A quantity of 4 was transferred from plant stock to that WBS via MB1B/415 (915, Z15). The total value of movement is $20.00. The new total value of that project stock line is $80.00. The new quantity is 10. The new moving average price for those 10 on that WBS is therefore $8.00.
In the case of movement type 416 (916, Z16), which is transfer from project stock back to plant stock, the system also uses the value from the plant stock moving average price. If the project stock moving average price is higher than the plant stock moving average price, any remaining inventory on the project stock line is then increased in moving average price.
For example: A quantity of 10 is on hand in project stock with a total value of $100.00 (moving average price = $10.00 each.). The plant stock moving average price is $5.00 each. A quantity of 4 on that WBS is moved to plant stock via MB1B/416 (916, Z16). The total value of the movement is $20.00 (not $40.00). That leaves a total value in project stock of $80.00 and a quantity of 6. The new project stock moving average price for those six items remaining on that WBS is $13.33 each.
MB1B transfers of materials from one project to another affect the moving average price on the Receiving project only. With this transfer, the moving average price on the material/WBS in the Sending project is always used to determine the valuation of the movement. The Receiving project is charged that amount times the quantity transferred. The moving average price on the receiving project is affected/changed accordingly if its moving average price for that material is different than that.
The quantity and total value on the sending project are reduced but the moving average price is logically unchanged.
A goods issue has no effect on moving average price. However, the goods issue is affected by the moving average price. The goods issue is simply valuated at whatever the current moving average price is for that material on that WBS at the time of the issue.
This incurs actual cost for materials against the MWO temporarily until the MWO is settled. Then, this actual cost rolls up to the WBS. This impact on actual cost to the work order and WBS is in large part why understanding moving average price is so important.
In any project, it is obviously critical that these actual costs are depicted accurately. It is therefore critical to understand how and why they can be artificially inflated or deflated.
It doesn’t matter what price was shown on the PO that the material was received against. Nor does it matter what price the invoice for that PO was posted at. To valuate the goods issue, the system uses the current moving average price, which may be entirely different than either the GR or invoice price per item.
Question: Why would the current moving average price be different than the GR or invoice price?
Answer: Something else may have changed the moving average price for that material between the time of the GR/invoice and the goods issue. Examples include a manual change via transaction MR21 against the material/WBS. Goods receipts or invoice postings for other POs with that same material and WBS may have been executed for higher or lower prices. Transfers to or from plant stock or other projects (with a different moving average price) may have occurred. These are not the only possible causes. Other circumstances could apply as well.
Regardless of the reason for the change in moving average price, the goods issue cost is based on the moving average price at the time the issue is executed. This can truly confuse users and management.
Question: Why doesn’t the system use the PO (i.e., GR) price or invoice price to valuate the goods issue?
Answer: In standard SAP, the system doesn’t know or care exactly how a specific piece of material got on the project stock line and became eligible for issue. That item can be one of many in a quantity of that particular material that came from any of several sources. Some may have been transferred as excess from another project stock line with a greater or lesser value than the receiving project. Some may have been placed directly on the project as initial inventory (i.e., pennies from heaven) with a manually entered external price. Some may have been via a PO that paid excessive expediting costs. The system has no way to consistently allocate a specific piece of material from a specific source, to a specific work order and establish the actual cost on that basis. Moreover, a goods issue can be made up of quantities from several different sources.
Therefore, it relies simply on the average cost. The system was told to do so by virtue of the selection of moving average price as the price control method on the material masters when they were created. Even if the standard price were used as the price control method on the material masters rather than moving average price, the system would still disregard the PO and invoice price when valuating goods issues. In that case, it would simply use the price shown on the material master. But the PO and invoice prices could still be different from that. For more details on price control, see the later section labeled “Price Control V or S on a WBS.”
As just explained, a 261 goods issue has no effect on moving average price. The system simply always uses the current moving average price for that material on that project stock line (WBS) at the time of the goods issue. It reduces quantity on hand, but at the existing price per piece. Thus there is no impact on moving average price.
However, a 262 goods issue reversal can affect moving average price. On the 262 (GI reversal), the system disregards the current moving average price and uses the price and quantity from the original GI. That means the system adds that original quantity back into inventory and adds the original value back onto the project stock account. As with any circumstance that results in a change to either the total value or quantity of the account, the system then recalculates the moving average price by dividing the new total value by the new total quantity.
If the moving average price had changed between the time of the original goods issue and the goods issue reversal, the reversal absolutely affects the moving average price in one direction or the other.
SAP implementations frequently choose price control V (moving average price) when setting up their materials rather than S (standard price) because it provides for a more accurate capturing of the cost of materials if formal manual price changes on materials are only to be executed on a periodic (e.g., yearly) basis.
For those implementations, when creating material masters, price control is always V for any materials that are not split valuated. On split valuated materials, however, it should be V for the Parent and S for the Children (valuation types).
However, when creating materials in standard SAP, the system defaults to S on the Price Control field of the Accounting 1 View (Figure 12). If it is not changed, it stays as S on the material master (i.e., plant stock).
Material master accounting 1 view
In Figure 12, note that the Price Control field is defaulted to S, the Standard price field is at 500, and the Material number is 450109030. In this case $500 was established as the initial price of the material. During the creation of this material (450109030), the S was unintentionally left in place when the material master was saved. The impact of this is not limited strictly to plant stock. If left unchanged, the S would have a tremendous impact on project stock as well. Briefly stated, if a PO is created with an assignment category of Q to obtain this material for a project/WBS, and the GR is executed, this material number would have an absolutely unchangeable price control of S on that WBS (project stock line). A detailed explanation follows.
The project stock has a price control as well. It gets it from the material master the first time the material is received into inventory on that project stock line (WBS). Once the price control is established for a material on a WBS, it keeps it no matter what you do to the material master.
This occurs when the material is initially received against the PO. At the time of the receipt, the project stock account adopts the price control shown for that material on the material master. If that price control is S, the stock account is charged the current price shown on the material master at the time the goods receipt is executed. That price then becomes the standard price of that material on that project stock line. As with any material with a price control of S, if the PO line item price is different than the current price on the material master at the time of receipt, the PO History will reflect that PO line item price. However, a review of the accounting document for the receipt will show that the stock account is actually charged the material master price.
Once the project stock line adopts the price control for a particular material, it’s locked in. Even if you then change the material master to a V price control, the WBS on which you put the material still retains the S for that material, and nothing I can find will change it. It’s too late to change the material master after the fact. “The horse is out of the barn” so to speak. (If the material master were to have been corrected before the material was put on the PO, the WBS would have picked up the V price control.)
This doesn’t affect the moving average price – it prevents the moving average price. This is because materials with S price control (including project stock materials) do not change price until they are manually changed. Differences in price on items such as GRs, invoices, and subsequent debits/credits are simply posted as off-setting charges to price difference accounts. However, the stock account is charged the full standard price (nothing more, nothing less) established at the initial receipt.
When a goods issue of a project stock material in this circumstance is executed, the system uses the standard price shown on transaction MBBS (Valuated Sales Order and Project Stock) and in table QBEW for that material on that WBS. Unless a manual change has been made directly to the material/WBS price via MR21, MBBS and table QBEW still show the standard price that was established on the material master and locked in earlier when the PO was received (Figure 13).
Valuated sales order and project stock
In Figure 13, the Material, WBS Element, and Price are designated. The Standard price field shows the current value. Material 450109030 is shown on the project stock line for WBS DR-00015.12 with a price control of S. That is because the material master reflected a price control of S and a standard price of $500.00 when the PO was created. Therefore, once the PO is received, it is shown in the system with that price.
Even if the PO price for this material had been a higher or lower amount, transaction MBBS and table QBEW (Project Stock Valuation) would show that the system ignored that price and valued the material at $500.00 due to the S price control. The difference would have been posted to a Price Difference Account. More importantly, all future purchases of this material for this WBS would be valued at $500.00 regardless of the price specified on the POs.
The system obviously ignores what should be the current moving average price, and at this point, it now also ignores the current price on the material master. Regardless of whether the material master is still set at S or has been changed to a V price control and regardless of whether the price on the material master has been raised or lowered since the goods receipt was executed – it doesn’t matter. The price currently on the material master is depicting plant stock price. This stock is now project stock. A change in the price of either has no impact on the price of the other.
Once that material is S and project stock, you’re stuck with that as the price control as long as that WBS includes that material – both now and in the future. This cannot even be changed with an MR21 variant set to display/change the WBS element. In this circumstance, the Price Control field is grayed out. You can use it to change the price, but not the price control. Even if you issue or transfer all that material off the project stock line, change the material master to V, and then receive more, the new quantity of that material on that WBS will have a price control of S.
This is not inconsequential. This means that the actual cost shown on the MWO could be under- or over-valuated. And therefore, so is the WBS under charged, or over charged.
The error message “Moving average price for material is negative” is encountered under certain circumstances. Usually this involves invoice reversals, but it can even involve the posting of the invoice itself. Either one can cause a reduction in the stock account value. A reduction of the stock account occurs during the posting of the invoice itself if the invoice is less than the GR in terms of price per item. It occurs during an invoice reversal if the invoice was higher than the GR in price per item.
The error message “Moving average price for material is negative” is not encountered when executing a GR reversal. GR reversals seem to be exempt from this error. The best way to think about this error is this: It is displayed whenever an invoice or invoice reversal would result in the moving average price for the stock on hand being reduced to less than zero (i.e., to a negative value). The system prevents that by disallowing the completion of the transaction. Since this error can occur with the execution of either the invoice, or the invoice reversal, I will further explain them separately.
First I will cover the occurrence of the error when executing an invoice reversal: In most reversal circumstances, you will not encounter this message. It occurs only if all of the following are true:
- A GR for the PO involved has been executed and not reversed or others have been posted to replace it (i.e., there must be a net receipt effect in place for this particular PO).
- The GR and the invoice were not the same price per item. The price per item on the invoice was higher than the price per item on the GR. (The reversal of the invoice will reinstate the effect of the GR bringing the moving average price of the material lower rather than higher.)
- Other movements (or a manual price adjustment) have occurred since the GR was executed that lowered the moving average price of the material on the project stock line.
- There is still stock on hand on the project stock line
- The current total value of the stock account is less than the dollar amount by which the reversal would cause the system to reduce the stock account.
Note that it is important to understand that the system does not automatically charge the full dollar amount of the invoice reversal against the stock account. The dollar amount that hits the Stock Account is based on this: The difference in price per item on the GR compared to the price per item on the invoice (multiplied by) the quantity received on the GR, or the quantity on the invoice, or the quantity on hand whichever is the lower of the three. So let’s say both the GR and the invoice were for a quantity of 10. The GR was for a total of $50.00 (i.e., $5.00 each), and the invoice was for a total of $150.00 (i.e., $15.00 each). The difference in price per item is $10.00 each. The most that the system would charge the stock account for the $150.00 reversal is $100.00.
However, if there are only two on hand when the invoice is reversed, the stock account would only be charged $20.00 (2 times the $10.00 each difference, not the entire $100.00, much less the entire $150.00). If the moving average price of the 2 on hand happened to be $10.01 each for a total on-hand value of $20.02, the invoice would successfully post and the error message would not occur. The rest of the $100.00 (i.e., $80.00) goes to the price difference account. In this example, the stock account would be left with a total value of only $0.02. Since it’s not a negative value, the system allows the reversal to post.
Here again (although it may seem strange), if there is zero quantity on hand, the system also allows the reversal to post. In that case, automatic account determination functionality is set to simply apply the entire reduction to the price differences account. The system accepts that outcome, but won’t allow the project stock account to have a negative total value/moving average price.
Now let’s discuss the occurrence of the same error when executing the Invoice itself: The error message is even less likely to occur when executing an invoice than it is when executing an invoice reversal. The circumstances in which it occurs are exactly the same as they are for the invoice reversal except that the difference in price per item between the GR and the invoice must be in the opposite direction. In this case, the error message occurs only if all the following are true:
- A GR for the PO involved has been executed and not reversed or others have been posted to replace it (i.e., there must be a net receipt effect in place for this particular PO).
- The GR and the invoice were not the same price per item. This time however, the price per item on the invoice is lower than the price per item on the GR posted earlier. (When the invoice is posted, the system would use the price per item on the invoice to replace the price per item from the GR on that quantity, again bringing the moving average price of the material lower.)
- Other movements (or a manual price adjustment) have occurred (since the GR was executed) that lowered the moving average price of the material on the project stock line.
- There is still stock on hand on the project stock line
- The current total value of the stock account is less than the dollar amount that the system would reduce the stock account by as a result of the invoice being posted.
Similar to the system’s reaction to the invoice reversal, here too, it is important to understand that the system does not automatically reduce the stock account by the full dollar amount of the difference between the GR and the invoice. The dollar amount that hits the stock account (that the account is reduced by) when this lesser value invoice is posted is calculated in the same manner as it is for an invoice reversal. That is: The difference in price per item on the GR compared to the price per item on the invoice (multiplied by) the quantity received on the GR, or the quantity on the invoice, or the quantity on hand, whichever is the lower of the three. So let’s say the GR was for a quantity of 10, and the total value of the GR was $200.00 (i.e., $20.00 each). Let’s also say the invoice was for a quantity of 5 with a total value of $60.00 (i.e., $12.00 each). The difference in price per item is $8.00 each. Let’s say that there was still a quantity of 6 on hand at the time of the invoice. How would the system calculate the amount by which to reduce the stock account? The system would multiply the $8.00 (difference in price per item) times 5 (the invoice quantity was the lowest of the three quantities). Therefore, the system would reduce the stock account by only $40.00 (even though the total difference between the GR value and invoice value was $140.00).
Would the error message occur in this case? It depends on the total value of the stock account at the time the invoice is executed (i.e., the total value of the 6 still on hand on that project stock line). If the total value was $40.00 or more, the error would not occur and the invoice would successfully post. That means the moving average price of the 6 on hand would have to be at least $6.67. (In that case, the successful posting of the invoice would have a great impact on the resulting moving average price.) If the current value were less than that amount, the system would provide the hard error and disallow the invoice.
Once again, if there is zero quantity on hand, the system allows the invoice to post. In that case, automatic account determination functionality is set up to apply the entire reduction to the price differences account.
Question: How can this problem be solved and the error circumvented?
Answer: There are many things that could be done, each with pros and cons. If a goods issue has already occurred, temporarily reversing it usually puts enough quantity and dollar value on hand to allow the invoice, or the invoice reversal, to be executed. That would always be the preferred method because the later re-posting of the goods issue would then be at the new moving average price that resulted from the invoice. That means the actual cost to the work order created by the goods issue would now be more accurate.
You could instead artificially remove all stock by a transfer (i.e., bringing the quantity down to zero), and then transfer it back after posting the invoice or the invoice reversal. Manually increasing the total dollar value of the quantity already on hand by using an MR21 price change on the material/WBS would also work. The price could then be adjusted back down again. Other ways include movements 701 then 702 (gain, then loss by inventory), or 561/562 (pennies from heaven, then reversal).Understand that all of them either affect the moving average price on the front end, on the back end, or both.
MI07/701 and 702 have no impact on moving average price because the current moving average price is used to valuate the loss or gain in actual quantity of the material.
- 701 (Gain by Inventory) occurs when an inventory is conducted on a material and the system is told that a greater quantity of the material exists than the system showed. The standard inventory transactions to accomplish this are MI01 – Create Inventory Document, and MI04 – Enter Inventory Count. When the difference is posted (via transaction MI07), the system creates/executes a 701 movement type in the background. The system creates a material document to show the gain in actual inventory quantity, and an accounting document to show the gain in value to the stock account.
- 702 (Loss by Inventory) is exactly the opposite of the above.
- Both 701 and 702 apply to plant stock or project stock– on whichever the inventory is being conducted. If on plant stock, the system uses the current moving average price for plant stock shown on the material master (times the quantity gained or lost) as the value of the movement. If the inventory is on project stock, the system uses the current moving average price for that material on that WBS times the quantity. Either way, the existing moving average price is used to determine value for the added/removed quantity, so there is no change to the average value occurs.
- As I mentioned, deliveries do not affect moving average price.
About the Author
Robert A. Jackson has 13 years of experience with ERP software including 11 years experience with SAP. He is an SAP-Certified Consultant in Materials Management and has significant experience in the development and presentation of SAP Plant Maintenance training. He also has 27 years of experience in commercial nuclear power maintenance with 17 as a certified Nuclear Training Instructor/Developer for maintenance training programs. Robert has developed, presented, and managed training programs at three separate nuclear power plants for journeyman technicians, maintenance contractors, and management positions.
For the last 10 years, he has served as an MM consultant, Tier III customer support, and configuration specialist on a project for the US Navy involving maintenance. During that time, he also assisted the project’s Training Department in the creation and review of numerous training guides and authored many training bulletins. You may reach Robert via email at firstname.lastname@example.org