Intercompany trade scenario External material delivery purchase

The ownership of the goods changes from an external supplier (which can be an affiliated company) to an internal financial entity based on an order of another internal financial entity, which is invoiced by the external supplier.

A multinational organization has a central purchase office that buys materials for its production plants located in various countries. The purchase office buys the materials from external suppliers. The production plants are modeled as separate financial entities. The purchase office charges the production plants internally for the costs it made.

To charge the production plants, the central purchase office sends intercompany trade orders to the production plants. The charges can be based on various pricing rules, such as the purchase price paid to the external supplier.

On the intercompany trade order, the purchase office is the selling entity and the production plants are the buying entities.

Business processes

The External (Material) Delivery Purchase scenario is used for these business processes:

• Purchase process

  A purchase order or purchase schedule with a receiving warehouse belonging to a different entity. The receipts can include:

  • Purchased items
  • Subcontracted items or subassemblies with or without material flow

• Assembly Control

  A receipt for an assembly line from an assembly line belonging to a different logistic company. The receipt is based on a purchase order.

• Job Shop Control process

  A receipt for a purchase order created for a Production Order WIP. The receipt includes subcontracted service items without material flow.

• Service process

  Receipts of subcontracted items for a purchase order based on:

  • A service order WIP
  • A maintenance sales order WIP

• Supplier Claim

  Receipts, returns excluded.

• Project

  A project receipt for a purchase order

In this scenario, the intercompany trade orders are generated when the originating purchase order lines, purchase schedule lines, or the supplier claim receipt lines are created. The transaction lines are created when the receipt is completed. See Intercompany trade orders

Supported price origins

• Cost-Plus
• Commercial Price
• Purchase Order Price (Gross)
• Purchase Order Price (Net)