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Material on Loan - Inventory Management - SAP Implementation

Material on Loan SAP Recommended Process: Material on Loan Material on loan received from vendors is entered through a configured... thumbnail 1 summary

Material on Loan

SAP Recommended Process: Material on Loan


Material on loan received from vendors is entered through a configured movement type and without reference to a purchase order. The warehouse manager will enter the stock transfer after receiving the approved loan transfer document. The stock account will be debited and a material on loan account will be credited.


Material may be returned against the loan or the vendor may be given payment for the material. In case the vendor is to be paid a non PO invoice document will be posted in FI, thus clearing the material on loan account i.e. the material on loan account is debited and vendor account is credited. However, if the material is returned to the vendor instead, a loan return transaction is posted in the system. This will reverse the effect of the preceding entry and update all relevant accounts.

A similar process will be followed for material issued on loan, again using a customized movement type.

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