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Logistics Invoice Verification - Basic Functions

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MR11

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Created by Sandra Rossi, last modified by Levente Kiraly on Dec 13, 2021

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Disclaimer (December 9th, 2021): due to some old technical reason while reorganizing wiki pages, I am shown here as author or this page, against my will, as the content is not from me.

Introduction:

What we want to do today is give a basic review of the MR11 and point out reasons why this transaction can be very helpful to you in monitoring your Purchase Orders. For instance: - How are you going to know when invoices have been entered against your GR's? - How will you know if an invoice has been entered BEFORE you have done the GR? - I might mention at this point that this situation will become more common. With the pressure the offices are under to get their invoices in for payment, they are not going to have time to contact you on an individual basis asking you to verify delivery of a good/service and do the GR so they can do the invoice. - Is there a way that you can get a quick overview of how your entire agency's PO's look at one time? This is where the MR11 transaction comes in quite handy.

MR11

Overview

NOTE:

For inventory Purchase Orders, please see additional instructions at the end of this document.

The MR11 transaction deals with quantity issues. It's the quantity of GR's and IR's that drive this transaction. Both Valuated and Non-Valuated PO's are included in the reports.

Trigger: 1. You've to find out number of your blocked invoices is getting pretty high, and the suggested reason has to do with GR issues: You need a report that will list all of your PO's and show the total number of GR's entered compared to the number of IR's entered. q If the goods/services have been received and a GR was entered but no invoice has been processed yet, you will see it in the report generated by MR11. o This is particularly important when the GR entered is very old. We are at the fiscal year closing. By running this transaction looking specifically for this situation, if there are any, you will see them in your report. q If an invoice has been entered against one of your PO's before you had time to get the good/service verified and the GR entered, you will see it in the report generated by MR11. o This is particularly important when the IR entered is very old. We are at the fiscal year closing. By running this transaction looking specifically for this situation, if there are any, you will see them in your report. q If a PO has an unusually large discrepancy between the total GR's and IR's, you will see this while reviewing the MR11. 2. A discrepancy (quantity) occurred between Goods Receipt (GR) and Invoice Receipt (IR). MR11 deals with quantity differences, not dollars. This needs to be cleared. Examples of situations where this occurs are: q If the goods have been received, the vendor hasn't invoiced for the goods and won't be invoicing (the vendor has gone out of business). Use MR11 o Remember the GR/IR account is a clearing account allowing you to post an expense when you receive a good/service. Paying for that good/service offsets the GR. If the vendor doesn't invoice, that GR will never go away. Of course, we get the free goods!! q An invoice with reference to a Purchase Order was paid through accounts payable FI (as a direct) instead of procurement. Use MR11 q The goods were received and sent back to the vendor for poor quality. The vendor was accidentally paid and we will not be reimbursed due to bankruptcy of the vendor. Use MR11 Please Note: These are examples of the kinds of situations and it is not necessary that same screen shots are available in the document that may require the use of MR11 to make a correction to the PO. This should only be done after other options for correcting PO issues have proven unsuccessful. Using this transaction should only be done at the request of IES & Comptrollers'. q Quantity ordered = 100 ea. at a unit price of $1.00, receive quantity of 97 ea. at a unit price of $1.00. If the remaining balance of 3 ea. will not be shipped, purchaser needs to reduce the open quantity on the purchase order to reflect the actual amount received. DO NOT Use MR11 o The point here is that the PO should reflect the activity of what happened as closely as possible. At 97, for all practical purposes, the PO has been completely satisfied. o By reducing the line item to 97 total, a GR for the last 3 items can not be accidentally done. o Reducing the line item to 97 leave a good audit trail for any audits that may be done at a later date. Maintenance of the GR/IR Clearing account should be done regularly. It's recommended to be done weekly for both IR surplus and GR surplus. Run IR surplus with movement up to today. For GR (delivery) surplus, run maintenance with movement one or two months old. NOTE: During the normal business flow of the documents, 99% of your Purchase Orders will show up on the GR/IR at some time and should NOT be cleared. Nothing should be done to them through MR11. When the normal business process is completed, the document will no longer have a discrepancy between the GR and IR, and will not be on the list when you run MR11.

Procedure Steps

1.1. Access transaction by:

The screen "Maintain GR/IR Clearing Account" will display.

See screen shot below. If any corrective action is taken, this will be the posting date.

Always uncheck Note that you can generate this report for either GR surplus or IR surplus, or BOTH.

1.2. On screen "Maintain GR/IR Clearing Account", ONLY enter information in the BOLDED fields as specified in the table below:

Field Name

Description R/O/C User Action and Values Comments

(Note: On above table, in column "R/O/C"; "R" = Required, "O" = Optional, "C" = Conditional) NOTE: The table above gives detail information on every field available to use in the criteria for selection of the transaction MR11. The bolded fields are the recommended minimum information to be entered to run a listing of the PO's that affect the GR/IR. If needed due to volume, you may enter additional criteria to limit the selection.

1.2.1. After entering information, click on the execute (F8) button, as shown below.

Lists of purchasing documents, which meet criteria selected and have GR/IR account balances will be displayed, as shown below.

From the screen "'Maintain GR/IR Clearing Account" that has the List of Purchase Order Items' you should view the Purchase Order before clearing the GR/IR account. Select the Purchase Order, and click on the View Purchase Order button as shown above.

The Purchase Order will be displayed, as shown below

1.3. If the outstanding GR/IR will never occur, the document should be cleared. To post a clearing, On screen "Maintain GR/IR Clearing Account" that has the List of Purchase Order Items', select the line item(s) to be cleared and click on the Post button to Post Clearing.

1.4. When clearing posts, on screen "Maintain GR/IR Clearing Account", a log will be created detailing the GR/IR clearing account posting and a document number will be issued. As shown below.

Instructions for Inventory Purchase Orders: When clearing out your inventory purchase order via MR11, additional steps need to occur to keep the moving average price correct in SAP.

Run transaction MR11 to obtain listing of all Purchase Orders having open GR/IR.

Research listing of Purchase Orders and verify GR/IR needs cleared out.

Identify the Inventory Purchase Orders (account assignment is blank).

Clear the Purchase Order through transaction MR11 - maintain GR/IR clearing account (directions above). A log will be created displaying a GR/IR Clearing Account document number for each Purchase Order.

Retain the clearing account document number for the Inventory Purchase Orders cleared through MR11 and forward the clearing document number to Barbara.

IPA will perform revaluation of the material's moving average price.

Completion of these steps will clear the Purchase Orders through GR/IR,

Maintain proper account assignments, and correct the moving average price.

MR11 – Maintaining the GR/IR Clearing Account

Oona Flanagan

ERPfixers Blog Series

Right after a new implementation, everybody is concentrating on getting the invoicing right, and paying suppliers etc. and they tend to assume that the GR/IR is taking care of itself. Generally, if everything matches, it does, the problem is that not everybody understands that the quantity must match exactly to clear the GR/IR account. A typical problem where the invoices are posted manually, could be users struggling to post fractions correctly, for example where using the standard goods receipt process for a service. Another problem, where invoices and credit notes are posted via an interface, is not being able to distinguish between a price and quantity difference and using e.g. a credit memo to post all corrections.

My advice is always try to correct something the way it was originally posted. Not only is it easier to follow the PO history, but if you are clearing a lot of items in one go with MR11 it will put them in one document, making it impossible to reverse one item if you make a mistake. Also it assumes the higher quantity is incorrect e.g. if you have a goods receipt of 10 and an invoice of 6, it will reduce the 10 and the not increase the 6.

You can run MR11 selecting “prepare list” to see what is outstanding and investigate if you can correct it by other means. You can select “last movement before key date” which is based on the last goods movement to look at older items only.

Ideally, if there is a balance on the GR/IR account because the invoice or goods receipt was posted incorrectly or is missing, then instead of using MR11, post the missing goods receipt or invoice, or reverse it out and post it correctly.

A problem may occur if you need to reverse out the invoice (which you may also need to do in order to correct the goods receipt), if it has already been included in a payment with other invoices. One option is to post a dummy credit instead, reverse/correct the goods receipt and then reverse the dummy credit, but if you have many such items it may be easier to use MR11.

Another reason to use MR11 could be that you have had a stock-take and the stock has already been corrected, or the stock has already been issued and any correction to the stock would make the stock negative. Or, it is simply too late or complicated to warrant the time investigating what happened with smaller differences.

MR11 is all about correcting the balance on the GR/IR which is caused by a difference in quantity (not price) between the invoice and the goods receipt. It should only be used when no more invoices or goods receipts are expected or can be posted.

You can select items with only a small difference by selecting either the Qty.Var. less Than/Equal to %” or the “value variance less than/= to” fields. Note that selecting “automatic clearance” means that it will write off the differences as opposed to “prepare list” which only shows the differences”

MR11 documents can be reversed either by going into MR11_SHOW or by clicking on the account maintenance documenting the PO history, but be careful if more than one PO has been corrected in one MR11 document, as it will reverse the whole document.

If you post a correction using MR11 you will see a line in the PO history marked “account maintenance”, which refers to the accounting document (i.e. no MM document is produced). Do not be alarmed that there is no value in the PO history, only quantity, this is normal, although it is the opposite of what is actually posted.

In the case where there is e.g. a goods receipt and no invoice – the MR11 posting should show as a positive in the PO history, which means that the incorrect goods receipt value has been removed, reducing the stock value, assuming moving average price and sufficient quantity on hand exists, otherwise price differences will be credited.

Author: Oona Flanagan

Oona Flanagan is an expert Fixer, a qualified accountant and an S/4 HANA consultant who has spent over 17 years as an SAP FICO Consultant for a number of multinational projects, mainly in Europe. She has covered all aspects of the implementations, support and training for many well-known companies such as SAP themselves, Unilever, Coca Cola, Burberry, Danone, Britvic, BNP Paribas, Deloitte, Uniphar, Bombardier, Moet Hennessy. Author of several SAP Press E-Bites on the GR/IR and the payment program and more recently: "Introducing New Asset Accounting in SAP S/4HANA".

Module(s): Controlling, Financial Accounting, Investment Management, Materials Management, Project Systems (PS), Sales and Distribution, Treasury.

Tagged: Accounts Payable, Invoice Verification, Transaction MR11, GR/IR clearing

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mariel 4 years ago · 0 Likes

Hi! could you please tell me which IFRS regulates this GRNI clearing? As my accountant is telling me that running the MR11 is against the law! however I know certain conditions were overstimated when creating the OP. I highly appreciate your recommendation

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Frances Santha 4 years ago · 0 Likes

If there is no GR (goods receipts). IR is posted in Vendor Invoice Management (VIM) & blocked for quantity discrepancy (R). eg. 40pcs under invoice 1 40pcs under invoice 2 Subsequently MR11 is performed for only 40pcs Will the IR be auto released (R) for invoice 1?

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Bator 4 years ago · 0 Likes

Dear Oona, could you please support with one topic ? if the goods quantity receipt are less than invoice receipt, the difference between goods receipt and invoice can be posted to price difference via MR11 right ?

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Bator 4 years ago · 0 Likes

hello

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Newer PostTips For Keeping GR/IR Under Control

Business Process Procedure Overview
. The Goods Receipt/Invoice Receipt clearing account has a discrepancy for either price or quantity. The result is an entry in GR/IR account. This procedure details how to clear outstanding entries in the GR/IR account.

Via Menus	Logistics>Materials Management>Logistics Invoice Verification>GR/IR Account Maintenance>Maintain GR/IR Clearing Account
Via Transaction Code	MR11

Company Code	TWC1	R	Defaults
Posting Date	Date which is used when entering the document in Financial Accounting or Controlling	R	Defaults to 'Today's date' - Leave as is
Reference	An example would be vendor's own invoice number	O	Enter Reference - something that will help define in a search
Doc. Header text	Text pertaining to the document as a whole	O	Enter text - information that would be helpful as in an audit trail
Doc. Header text	Text pertaining to the document as a whole	O	Enter text - information that would be helpful as in an audit trail
Vendor	Vendor number	O	Enter Vendor number	Can search on a range
Freight vendor	Vendor who delivered goods	O	N/A
Purch. Organization	Purchasing organization number	R	Enter purchasing organization number	Can search on a range -
Purchasing Group	Purchasing Group number	O*	Enter Purchasing Group or use match code	Can search on a range -*Depending on Business area running GR/IR for, may want to fill in one or the other.
Plant	Plant number	O*	Enter Plant number	Can search on a range - *Depending on Business area running GR/IR for, may want to fill in one or the other.
Purchasing Document	Purchase Order number	O	Enter PO number	Can search on a range
Item	A number that uniquely identifies an item on a Purchasing document	O	Enter Item number	Can search on a range
Purchase Order date	Date purchasing document was created	O	Recommend enter the dates to cover the entire fiscal year. OR Enter date document was created if using to limit search	Can search on a range
Purch. Doc. Category	Identifier allowing differentiation between types purchasing documents	O	Leave blank
Order type	Identifier allowing differentiation between the types of PO's	O	Enter PO type or Leave blank and analyze all PO's	Recommend Leave blank and analyze all PO's
Delivery Surplus	Indicator used to select purchase orders with a delivered quantity that exceeds the invoiced quantity.	R	Select either 'Delivery Surplus' or 'Invoice Surplus' or both entries.	Otherwise known as GR surplus
Invoice Surplus	Selection of all purchase orders with an invoiced quantity, which is larger than the quantity delivered.	R	Select either 'Delivery Surplus' or 'Invoice Surplus' or both entries
GR/IR clearing account	Indicator used to select purchase order items in which a quantity differences still exist between the goods receipt and invoice receipt postings	O	Set indicator to select
Delivery cost accounts	Indicator used to select purchase order items in which a quantity differences for planned delivery costs (freight) still exist between the goods receipt and invoice receipt postings	O	Set indicator to select
ERS purchase orders	Indicator used to settle with regard to PO or scheduling agreement items involving this vendor using Evaluated Receipt Settlement (ERS)	O	DO NOT Select this indicator Don't run MR11 on the Correctional Industries PO's - This will cause problems with the ERS process	ERS is being used on all PO's used to buy from Correctional Industries
Last movement before key date	Date where the last goods movement was before date	R	Defaults to today's date
Qty var. less than/equal to	The difference between the quantity delivered and quantity invoiced	O***	It's recommended to keep this field blank. Enter the percentage amount difference to be used for selection criteria - * select either quantity variance or value variance
Value variance less than/=to	Value variance between goods receipt value and invoice receipt value	O***	It's recommended to keep this field blank. Enter the value variance to be used for selection criteria - * select either quantity variance or value variance
Automatic clearance	Set indicator to automatically clear accounts	O	NEVER run with the option selected	Never automatically clear - prepare a list and review before clearing
Prepare list	Set indicator to prepare a list of accounts balances available for clearing	O	Set indicator to select	Prepare a list and review before clearing
Layout	Determines the list format	O	N/A