In subcontracting, the vendor is provided with materials, which he uses to produce the finished product.
From the point of view of materials planning, subcontracting is initiated by the special procurement key subcontracting. The special procurement key is allocated to the finished product or the assembly in the material master in MRP 2 view.

The maximum number of days that the material can be with subcontractor without us having to reverse the excise on the CENVAT account. This information is used when we create a subcontracting challan to determine on exactly which date the materials have to be returned by.
Document that we use to issue and track subcontracting work. It allows us to make sure that all the materials we have sent to the subcontractor for processing are returned.
The challan consists of a header and line items. The header, in addition to organizational data, we should enter:

  • Preprinted number
  • Additional data
  • Identification marks
  • Nature of processing.

Each challan has two numbers, an internal document number and a challan number, which the system assigns to the challan when we save it. From a business perspective, this is the most important number. Each challan also has a status, which shows us what stage in processing it is at.

The line items are copied across from the transfer posting when we create the challan. We can also enter additional data for each item.

Here in this chapter we lean how to configure subcontracting scenario attribute for the Subcontracting process for a given Excise Group , Excise Transaction Type or / and Subtransaction

STEP 1: Following is the path For to Maintain the  SUBCONTRACTING ATTRIBUTES
  • Transaction code : SPRO

STEP 2 : Click on execute button to Maintain the  SUBCONTRACTING ATTRIBUTES

STEP 3 :  Then Click on New Entries  to Maintain SUBCONTRACTING ATTRIBUTES (  Following type Window will Open)

For the combination of Excise Group = 25 ; Excise Transaction Type = 57FC ; Sub Transaction Type =01 ; the following attribute have been defied as an example they may change case to case.

  • 1) Subtransaction Type Text :- Here we maintain the Text for the " Subtransaction Type ".
  • 2) Subcontracting Period :- It is the Time Period for which the Raw Material is being provided to subcontracting vendor on Subcontracting Challan Without Paying Excise Duty. As per present Law it is 180 Days.
  • 3) Exicse Percentage Rate :- Excise duty percentage applicable for subcontract operations. 
  • 4) Movement Goup Issues & Receipt :  Issues &Receipts of materials are grouped for a combination of transaction type and subtransaction type. Movement Group for Issues & Receipt are defined so that system can determine against what Material Document Subcontracting Challan is to be made , reconcilling the issues & Comsumption Qty.These groups will be used to club the movement types based on their nature (issues or receipts) .These groups can be defined individually for each Subtransaction Type of every Transaction type.
  • 5) Filter Non-Exicse :-We can define filter to avoid Non-Excisable material from Subcontracting Challan.
  • 6) Excise Invoice items :-  It shows the maximum number of line items that we are allowed to include in a single outgoing excise invoice. This information affects the transactions for creating outgoing excise invoices for factory sales and for other movements. This information is used to split the transfer postings items into multiple subcontracting challans.
  • 7) No range no. :- Is defined to pick number range to generate Subcontracting Challan number.
  • 8) ASSESSABLE VALUE / EXCISE INVOICE :- The Excise Base Value is determined from the assessable value table or from the excise invoice is dependent on this indicator.
  • 9) Subcontracting Output Type :- J1IF is standard T-code avaliable for taking the Output of Subcontracting Challan.

STEP 4 :  Click on Save Button to store Configured data

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