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Table of content
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Table of content
1 Logistics
1.1 Logistics - General (LO)
1.2 Product Lifecycle Management (PLM)
1.3 Sales and Distribution (SD)
1.4 Materials Management (MM)
1.5 Logistics Execution (LE)
1.6 Quality Management (QM)
1.7 Plant Maintenance (PM)
1.8 Customer Service (CS)
1.9 Production Planning and Control (PP)
1.10 Project System (PS)
1.11 Environment, Health and Safety (EHS)
1.12 SAP Retail
1.13 Global Trade
1.14 Chargeback Management
1.15 Agency Business
1.16 Country Versions
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1 Logistics

1.1 Logistics - General (LO)

1.2 Product Lifecycle Management (PLM)

1.3 Sales and Distribution (SD)

1.4 Materials Management (MM)

1.5 Logistics Execution (LE)

Quality Management (QM)
With the functions of this component, you can implement the most important elements of a quality management system (QM system), as specified in ISO 9000.
These functions are complemented by other integrated application components of the SAP system, such as Materials Management (MM) , Sales and
Distribution (SD), and Production Planning (PP) .
The integration of the QM application component in the SAP system allows quality management tasks to be combined with those in other applications (such as
materials management, production, sales and distribution and cost accounting).
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The QM application component supports tasks associated with quality planning, quality inspection and quality control. In addition, it controls the creation of quality
certificates and manages problems with the help of quality notifications.
The following components are available in QM:
Basic data (for example, material master, catalogs, inspection characteristics, inspection methods and sampling procedures).
Inspection planning (inspection plans, reference operation sets, material specifications).
QM in procurement.
QM in sales and distribution
Inspection lot processing (inspection lot creation and inspection lot completion)
Results recording
Defects recording
Sample management
Quality Information System
Dynamic modification of the inspection scope
Quality certificates
Quality notifications
Test equipment management

1.7 Plant Maintenance (PM)

1.8 Customer Service (CS)
This component supports you when representing, managing and processing all services that you provide to your customers. You can:
Structure and manage technical objects for which services should be performed (for example, technical systems, machines)
Manage data for warranties and business partners
Create service requests
Plan and execute requested services
Bill the costs that arise as a result of the services being executed
Monitor call processing in order to keep to deadlines and agreed response times
For information on other service-related functions, refer to the following documentation:
PM Structuring Technical Systems
for information on structuring and managing technical objects
FI-AA Asset Accounting - User Guide
for information on managing serviceable items as tangible assets
MM - Services Management
for information on service records
PM - Maintenance Notifications
for information on maintenance notification functionality
PM - Maintenance Orders
for information on maintenance order functionality
SD - Sales, Sales Order Processing
for information on managing and billing sales orders and service contracts.
PS - Project System
for information on using projects
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This function comprises:
Structuring and maintenance of the installed base using technical objects
Warranties, management
Call management, using service notifications, service orders and sales orders
Call monitoring with response and service times
Link between installed base and business partners

1.9 Production Planning and Control (PP)

1.10 Project System (PS)

Both large scale projects, such as building a factory, and small-scale projects, such as organizing a trade fair, require precise planning of the many detailed
activities involved. The project manager has the job of ensuring that the project is executed efficiently, on time, and within budget - which he or she achieves by
ensuring that the required resources and funds are available as and when needed.
Projects are generally part of the internal processes of a company. To be able to control all tasks in project execution, you need an organizational form that is
specific to the project and which is shared by all departments involved. Before you can carry out a project in its entirety, the project goals must be precisely
described and the project activities to be carried out must be structured. A clear, unambiguous project structure is the basis for successful project planning,
monitoring, and control.
You structure your project per the following points of view:
By structures, using a work breakdown structure (WBS)
By process, using individual activities (work packages)
Project managers usually distinguish between two types of project:
Externally financed projects
Customer projects
Internally financed projects
Overhead cost projects
Capital investment projects
For further information on capital investment projects, see the SAP Library under Investment Management (IM).
The high degree of integration between the Project System (PS) and other application components means that you can plan, execute, and account for projects as
part of your normal commercial procedures. This means the Project System has constant access to data in all the departments involved in the project.
The Project System guarantees close and constant monitoring of all aspects of your project.
This includes both technical and commercial aspects of the project.

Environment, Health and Safety (EHS)
This SAP component supports you with all activities in the areas of industrial safety, health, and environmental protection.
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To be able to use all EH&S functions, you will require the following SAP components:
Function Required Component Necessary
Entry of logistical data for substances
Material Master (LO-MD-MM)
Setting up value assignment types
Classification System (CA-CL)
Implementation of engineering change management
Engineering Change Management (LO-ECH)
Report management
Document Management (CA-DMS)
Report shipping, dangerous goods management
Materials Management (MM), Sales and Distribution (SD)
Transfer of employee data
Personnel Administration (PA-PA)
Transfer of data from business partners to the injury/illness log, incident/accident log,
and accident reports
SAP Business Partner (CA-BP)
Defining of exposure groups, assigning of agents Organizational Management (BC-BMT-OM)
Integration of data into the work area
Work Centers (PP-BD-WKC)
Functional Locations (PM-EQM-FL)
Material Master (LO-MD-MM)
Environment, Health and Safety comprises the following SAP components:
Basic Data and Tools (EHS-BD) contains all data and functions you require for the other EH&S components at one central point. For example, you can
manage specifications for various EH&S objects (substances, dangerous goods classifications, agents, waste codes, and packagings) and text modules
(known as phrases), and create templates for EH&S reports. It also includes tools that allow you, for example, to enter and display language-dependent
EH&S data in all possible languages in the SAP system, and to exchange data between systems.
Product Safety (EHS-SAF) contains functions required to manage hazardous substances in companies that manufacture hazardous substances. For
example, you can manage and ship EH&S reports such as material safety data sheets, create labels, have the system determine them automatically, and
create the composition of the specification of the relevant substance from the BOM for a material.
Hazardous Substance Management (EHS-HSM) contains functions required to manage hazardous substances in companies that use hazardous substances.
For example, functions are available that make it easier for you to create the reports prescribed by the U.S. Superfund Amendments and Reauthorization Act
With Dangerous Goods Management (EHS-DGP), you can manage dangerous goods master records, run dangerous goods checks, and create dangerous
goods documents.
With Waste Management (EHS-WA), you can manage waste disposal processes, create the reports necessary for transportation and disposal of waste, and
distribute the resulting costs proportionally among the cost centers in the enterprise that generated the waste.
With Occupational Health (EHS-HEA), you can plan and perform health surveillance protocols in your enterprise, and create and manage occupational health
With Industrial Hygiene and Safety (EHS-IHS), you can organize industrial hygiene and safety in your enterprise and manage the hazards and agents that are
present. In addition, you can process events with or without injury to persons and create reports such as standard operating procedures and accident reports.

1.12 SAP Retail
Basic Principles
This Documentation
SAP Retail Overview
Configuration as SAP Retail
Retail Terminology
Organizational Structure
Vendor Consignment
Background Processing
Central Coordination
Master Data
Strategic Sales

Local Operations
Distributed Data Processing
POS Interface
Transferring PRICAT Messages
SAP Retail Store
Distribution of Applications to Multiple Systems (ALE)
Interface to AFS
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Merchandise Logistics
Interface to AFS

Information and Planning System
Data Warehousing
Merchandise and Assortment Planning
Additional Information
Relevant Cross-Application Documentation
For detailed documentation about numerous topics, see the SAP Service Marketplace under Expert
Knowledge Corner .

1.13 Global Trade
In the trading environment, it is necessary to control and organize the flow of materials and services from vendors to customers. The principle of the business is to
match demand from the customer with supply from the vendor. This type of business is known as triangular business, principal business, or back-to-back
business. The industry defines this type of business as business where purchasing and sales are carried out in parallel, in the same trading department. For
example, you get a sales order from a customer, search for the best vendor to fulfil the customer's requirements, and issue a purchase order, all in one
transaction. You coordinate shipping, transportation, and customs clearance for the goods. The vendor then delivers the goods directly to the customer. The trading
company gets an invoice from the vendor, and bills the customer. Finally, you receive payment from the customer and make a payment to the vendor.
In the SAP system, this type of business process, in which sales and purchasing processes are carried out simultaneously, is defined as Trading Business.
SAP Global Trade's new object, Trading Contract, is used to handle this ordering process.
There are several types of procurement and sales expenses associated with trading business, such as inland freight, ocean freight, insurance, duty, and so on.
Trading charges linked to the Trading Contract can be processed by a new component, Trading Expense . The Trading Expense component is fully integrated
with the Trading Contract so that you can maintain purchase related expenses and selling related expenses centrally. Planned expenses can be entered in the
Trading Contract and accrued. Unplanned expenses can be linked to Trading Contract at a later stage when you receive invoices from service providers, freight
forwarders, insurance companies and customs offices. It is thus possible to assess accurate profitability as costs and revenue elements are linked to the Trading
Subsequent transactions such as goods receipt, inventory management, goods issue, invoice verification, and customer billing are maintained in the standard
SD/MM components .
Implementation Considerations
The Global Trade component is a part of the standard SAP system and can be used in all business transactions, independent of the line of business.
Since Trading Business initiates both Sales and Purchasing processes, it is mandatory to maintain both SD and MM settings and Customizing.
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The vendor and customer master, material master, conditions, sales transactions, and purchasing transactions must be in use if you want to use the Trading
Contract component.
For further information, see ;
Sales orders
Purchase Order

The Global Trade component provides:
Trading Contract
Trading Execution Workbench (TEW)
Position Management
Trading Expense

1.14 Chargeback Management
Chargeback management serves to map the different settlement procedures that are used in the wholesale trade. These include the processes that, based on
price agreements, trigger payments for invoices between manufacturers and your own company.
The agreement between the involved business partners and also all necessary information such as prices, conditions, and validity of the agreement are defined in
the condition contract. This condition contract is the basis for the conditions and also for settlement of payables with the manufacturer/vendor On the basis of the
condition contract, you can carry out evaluations in ECC and in SAP BW in order to keep statements with respect to the business partners, and also to obtain
evaluations regarding current payment processing of the settlement.
Flexible tools are available to cover the variety of business transactions. These enable you to control the price agreement, condition determination, and also the
settlement processes.

Agency Business
You can use this component to process transactions between third parties (such as brokers and payment agencies). You can offer the parties involved
advantages or services (such as del credere guaranties or simplified payment transactions), and perform settlement accounting for commissions in the system.
In pooled payment, the agency negotiates, for example, purchase price conditions and payment processing between the vendor and customer. The agency takes
a commission from the customer and/or the vendor for services rendered. Transactions relating to the actual merchandise (for example, purchase orders and
deliveries) can be carried out completely independently of the agency. For payment processing and calculating commission, the agency enters incoming
invoices and remuneration settlements in agency documents.
Agency documents have the following common features:
There may be no reference in the system to previous transactions
Payments have to be settled on particular dates
There is direct contact between the customer and the vendor.
With the 1.15 Agency Business component, you can enter documents without referring to previous transactions. This means that you can perform settlement
accounting for payments and commission, even if the system does not contain any master data or movement data for the articles concerned.
Incoming Invoices
You can enter invoices from vendors and credit memos either as single settlement requests or in the form of a settlement request list.
Remuneration Settlement
You can enter all ad hoc remunerations or charges made to the vendor in the form of a vendor billing document.
You can also enter expenses for a customer in an expense settlement document , using the same method.
You can then create follow-on documents from these agency documents to perform settlement accounting for the invoices, credit memos, and commission.
Implementation Considerations
The Agency Business component is a part of the SAP System and can be used in all business transactions, irrespective of the actual industry sector involved.
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The vendor and customer master and conditions must be in use if you want to use the Agency Business component.
The following relationships exist for components from the area of Retail :
Component Function
Vendor master Company-code-specific data, such as address, bank details, terms of payment and
partner functions is defined for vendors (mandatory).
Customer master Company-code-specific data, such as address, bank details, terms of payment and
partner functions is defined for customers (mandatory).
Conditions Condition records are defined, for example, discounts and charges.
Article master Article-specific data is defined for vendor billing documents and expense settlement
documents (mandatory).
Article-specific data is defined for payment (optional).
Site master Site-specific data is defined for payment and vendor billing documents (optional).

The following relationships exist for other SAP components:
Component Function
Financial Accounting General ledger, accounts payable and accounts receivable accounting for further
processing of accounting documents using, for example, payment runs and open posting
Logistics Information System Standard analyses are carried out
SAP Business Information Warehouse Update and analysis of statistical data from agency documents
Subsequent Settlement Conditions are defined for subsequent settlement of conditions relating to the business
Vendor billing document from the Subsequent Settlement document is used
Sales updates from the customer settlement document
Rebate settlement using the document Extended remuneration list
Archiving Archiving of agency documents
Profitability Analysis (Controlling) Incomes and rebates, for example, are transferred to the Profitability Analysis in the form
of profitability analysis documents.
Actual Costing/Material Ledger (Controlling)
Profit Center Accounting (Enterprise Controlling) Definition of an internal operating profit and additional controlling key figures for profit
Cash Management (Treasury) Documents that have not yet been forwarded to Accounting are transferred to Cash
Management to ensure that funds are made available in time for payment of business
Cash Budget Management (Treasury) Control of payment flows with regard to liquidity
Credit/Risk Management (Financial Accounting) Debit-side credit limit check for payment.
The section Functional Prerequisites for Agency Business describes the settings you need to make to process agency documents correctly.
Scope of Functions
Entry of incoming invoices without reference to preceding transactions, using the documents single settlement request and settlement request list/posting
list or settlement request list/customer settlement documents.
For further information, see Single Settlement Requests, Settlement Request Lists, Posting Lists and Customer Settlement Documents
Entry of remuneration settlements without reference to preceding transactions using the vendor billing document and expense settlement documents .
For further information, see Vendor Billing Documents or Expense Settlement Document.
Automatic determination of accounting-related data, such as terms of payment and cash discounts, when documents are entered.
Use of article-specific data.
Use of site-specific data.
Integrated calculation schema for determining prices and conditions.
Settlement of commission with business partners using the document Remuneration list or Extended remuneration list or settlement of rebates between
vendor and customer, using the document Extended remuneration list .
For more information, see Remuneration List or Extended Remuneration List.
Creation of accounting documents that are forwarded to Financial Accounting.
Output of agency documents in the form of lists.
The lists are particularly useful when you are searching for documents, as you can go directly from the list to the document. For further information, see List
Output for Agency Documents.
Option of going to Subsequent Settlement to define conditions that are to be settled retrospectively with business partners.
For further information, see: Subsequent Settlement.
Complaints processing using agency documents or the agency business portal.
For further information see Entering Complaints Using an Agency Document and Entering Complaints Using an Agency Business Portal.

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1.16 Country Versions
The SAP System offers over forty standard country* versions, each of which is designed to allow you to run your business operations in a particular country.
This documentation concerns the standard country versions only, which are wholly part of the standard system. Nonstandard country versions,
on the other hand, are provided by SAP's subsidiaries and partners in the form of modifications and add-ons, and may not necessarily be
compatible with other add-on solutions. For more information, see the SAP Service Marketplace on
Country versions do not constitute separate application components. Instead, the country-specific functions are contained in the various application components.
This means that the Financial Accounting (FI) component, for example, does not just contain generic FI functions, but country-specific functions as well.
Since all of the country-specific functions are supplied in the standard system, all of the standard country versions are mutually compatible. This means, for
example, that you can use the country versions for Brazil, China, and Turkey on a single physical system.
Each country version consists of the generic system functions, country-specific functions, and a country template. For consultants involved in implementation
projects covering multiple countries, SAP also provides the SAP Globalization Knowledge Base. These are described in more detail in the following.
Generic Functions
Every country version is based on the generic functions, that is, those functions that are shared by the vast majority of countries, such as General Ledger
(FIGL) or Plant Maintenance (PM). These functions are documented in the rest of the SAP Library.
Country-Specific Functions
In addition to the generic functions, country versions also include country-specific functions. These are functions that are only used in a particular country and
cover needs arising from local legislation or business practices. They include:
Localized versions of generic functions
Some generic functions are heavily localized, for example, Travel Expenses (FITVCOS), which is available as a generic version and in a number of
different country versions, and Payroll (PY). The standard SAP System also includes numerous value-added tax reports that cover the needs of different
Other generic functions may only have to be localized for fewer countries, for example, the vendor payment history report, which is available in a generic form
and as a Singaporean version.
Functions not otherwise covered by the generic functions
An example of this is manufacturing cost sheet, as used in South Korea.
Country Template
Each country version also comes with a country template, which you can use to set up organizational units for use in that country.
Which country versions you use does not have any bearing on which languages you operate the system in. For more information about which languages are
available and which you can combine on a single physical system, see Language Transport (BC-CTS-LAN).
SAP Globalization Knowledge Base
The documentation is complemented by the SAP Globalization Knowledge Base, a tool for consultants who implement the system in multiple countries. For
example, at the beginning of an implementation project, you can use it to assess the complexity of implementing the system in each country. For later on in the
project, it offers detailed technical information about the additional functions and features that are available for each country. You can access it on the SAP Service
Marketplace on

* The term country is used for convenience only and does not necessarily infer the existence of a nation state.
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