SAP SD module Introduction: The relationship with FICO, MM, PP, and WM modules

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Sales & Distribution (SD) is one of the core and most-used modules of SAP R/3 products beside Financial & Controlling (FICO), Material Management (MM), and Production Planning (PP) modules.

The main areas covered by SD module are:

  • Pre-sales activities, including Inquiry and Quotation creation.
  • Sales Order processing, including Sales Order (SO) creation.
  • Shipping, including Outbound Delivery document creation.
  • Billing, including Billing document and invoice creation.

The relationship between SD and MM, FI, PP, and WM modules

SD module is closely related and has integration with other modules, such as FI, MM, PP, and Warehouse Management (WM).

A Sales Order (SO) from SD module can trigger an availability check and demand in materials planning of products that will be sold to the customer. If the products are not available, it may trigger the PP module to create a Production Order; or it may trigger the MM module to purchase the products form vendor so the product will be available at the specified time.


Once the products are available at warehouse, SD module will create an Outbound Delivery document or Delivery Order (DO) that asks warehouse personnel to prepare the products to be delivered to the customer. If the warehouse uses WM module, the DO will trigger a Transfer Order document to pick the products from warehouse storage bin.

Once the products are ready to be delivered to the customer, the warehouse personnel will post the goods issue transaction. The inventory level at MM module will be reduced, the inventory account of FI General Ledger (G/L) account will be credited and inventory consumption/expense account will be debited.

Inventory account
Material consumption
expense account
XXX
XXX
The customer will receive the products. The finance department will generate a billing document (debit the customer’s Account Receivable account and credit the Revenue account) and send invoice to the customer with FI module. The Profitability Analysis (COPA) report will also be updated.

 

Customer’s Account Receivable
Revenue Account
XXXX
XXXX
The customer pays the bill and FI module will record the payments as debit to the bank (cash) account and credit to the customer’s Account Receivable account (so it will be zero)

 

Bank (cash) account
Customer’s Account Receivable
XXXX
XXXX
You can learn more about basic accounting concept in our previous article.In the next article we will explain more details about the main areas covered by SD module.

 

7 thoughts on “SAP SD module Introduction: The relationship with FICO, MM, PP, and WM modules”

  4. in group chart of account, i want to create
    grupu and sub grup like,
    Assest
    MAin Group is Assest
    sub group is fixed assest and current assest.
    pls show me path by step by step snap shot.

    Reply ↓

  5. I have 8 plus years as a SAP SD/MM Consultant, but I need to keep my skills up to date for clients, interviews, etc. I think that you site is great to assisting me with quick and update SD/MM info.

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