SAP MM Interview Questions and Answers
Introduction
If you’re preparing for SAP MM interview questions, you need crisp conceptual answers plus practical explanation of real-time scenarios (PR→PO→GR→IR, GST, S/4HANA differences). Below each question I give a clear definition, why it matters in projects, and short examples — many drawn from India-focused situations so your answers sound relevant in interviews.
SAP MM Interview Questions for Freshers — Detailed Answers
1. What is SAP MM?
Answer:
SAP Material Management (MM) is the SAP module that handles procurement, inventory management, master data (material & vendor), and invoice verification. It ensures materials are procured at the right price, in the required quantity, and delivered to the right place. In projects, MM is the backbone connecting procurement processes to accounting (FI) and logistics (SD/WM). Example: In an Indian manufacturing firm, MM ensures raw materials are available for production runs and helps post vendor invoices correctly to comply with GST.
2. What is the PR → PO → GR → IR cycle?
Answer:
This is the procure-to-pay cycle:
- PR (Purchase Requisition): Internal trigger created by requestor (consumption forecast or MRP). It signals need.
- PO (Purchase Order): Official supplier order created from PR or directly. Legal document with terms/price.
- GR (Goods Receipt): When materials arrive, MIGO is used to post GR; stock quantities increase and GR/IR account is posted.
- IR (Invoice Receipt): Vendor invoice posted (MIRO). System matches invoice to PO/GR and posts to vendor account.
Why it matters: Interviewers want to hear about tolerances, GR/IR clearing, and what to do when values differ. Example: If GR quantity differs from PO, you either post partial GR or reject; invoice will then be blocked in MRBR until resolved.
3. What is a Purchase Requisition?
Answer:
A PR is an internal document requesting procurement. It can be created manually (user creates PR) or automatically (MRP generates PRs). Key fields: material, quantity, delivery date, account assignment. Interview tip: explain types — stock PR vs. consumable (account assignment required).
4. What is a Purchase Order?
Answer:
A PO is a legally binding document sent to a vendor. It contains item details, price, delivery terms, incoterms, tax codes, and payment terms. In SAP, ME21N is used to create POs. Interviewers like hearing about PO lifecycle: creation → approval (release strategy) → printing/output to vendor → change history.
5. What is MIGO?
Answer:
MIGO is the central transaction for goods movements (GR, GI, transfer postings). When you post a GR with movement type 101, MIGO creates a material document and accounting document if valuation is required. In interview answers mention common errors (e.g., posting blocked due to incomplete PO or negative stock settings).
6. What is MIRO?
Answer:
MIRO posts vendor invoices against POs or deliveries. It performs invoice verification and triggers FI postings (vendor liability). MIRO can be blocked if amounts deviate beyond tolerances; interviewer may ask about MRBR (invoice release) or blocking reasons.
7. What is a Material Master?
Answer:
Material Master stores all data needed to manage a material: basic data, purchasing view, accounting view, MRP view, warehouse management. Explain importance: single source of truth across modules. Example: incorrect valuation class in material master can post to wrong GL account.
8. What is a Vendor Master?
Answer:
Vendor Master contains vendor’s company code and purchasing organization data, bank details, tax/GST numbers, partner functions, and contact details. Accurate vendor master is crucial for GST compliance in India (GSTIN must be recorded properly).
9. What is a Material Type?
Answer:
Material Type determines material behavior (procurement, valuation, number assignment). Examples: ROH (raw), HALB (semi-finished), FERT (finished), HAWA (trading). Material type controls whether a material can be procured externally, produced, or both.
10. What is a Movement Type?
Answer:
Movement Type categorizes goods movements (101: GR for PO, 102: GR reversal, 201: goods issue to cost center, 311: transfer posting). It controls which stock accounts are affected and whether accounting is updated. Be ready to explain why 101 posts to GR/IR account while 122/102 reverse.
11. What is Release Strategy?
Answer:
Release strategy is an approval workflow for PRs/POs based on criteria (amount, plant, material group). It uses classification and release codes. In interviews mention debugging a non-triggering release strategy — check characteristics, class assignments, and release group.
12. What is a Source List?
Answer:
Source List defines approved vendors and validity for each material at plant level. It supports source determination (automatic vendor selection) and can be set as mandatory to disallow procurement from unauthorized vendors.
13. What is an Info Record?
Answer:
Purchase Info Record stores vendor-specific data for a material (standard price, condition, delivery time). It helps default pricing into POs and supports source determination.
14. What is a Scheduling Agreement?
Answer:
Scheduling Agreement is a long-term purchasing contract where delivery schedules (deliveries dates/quantities) are maintained. Useful for regular supplies (e.g., monthly raw material delivery). In ME38 you maintain schedule lines and release conditions.
15. What is a Contract?
Answer:
A Contract (MK or outline agreement) defines terms with vendor over a time period; releases/orders drawn against contracts may be value-based or quantity-based. Contracts are for negotiated rates over time.
16. What is a Reservation?
Answer:
A Reservation locks stock for a specific requirement (production order, service). It prevents consumption by others and is posted as a material document. Interviewers often ask how reservations integrate with production.
SAP MM Interview Questions for 2–3 Years Experience
1. Explain subcontracting.
Answer:
Subcontracting: You send components to a vendor who performs processing and returns the finished product. Config: create subcontracting BOM, subcontracting PO, issue components (movement 541). On GR, system consumes components from your stock and posts finished goods. Real-time issue: wrong BOM or missing components lead to GR discrepancies.
2. What is Consignment in SAP MM?
Answer:
Vendor-supplied stock stored at company site but ownership stays with vendor. Consumption posts (101 with special stock indicator K) convert consignment stock to own stock and generate accounting entries to recognize liability. Interviewers may ask how consignment liability is reconciled.
3. What is Third-Party procurement?
Answer:
Vendor ships directly to the customer; company handles billing. SD creates sales order which triggers PO creation in MM. Challenges: GR is not posted to company stock; invoice verification deals with third-party scenarios and intercompany billing if required.
4. What is GR/IR clearing account?
Answer:
Temporary account that records GRs not yet invoiced and IRs not yet matched to GR. When both GR and IR exist for same PO, system clears GR/IR. In recon, uncleared items indicate missing invoice or missing goods receipt.
5. What is Quota Arrangement?
Answer:
Quota arrangement spreads procurement across multiple vendors in specified ratios/quantities. System picks vendor by quota during automatic vendor determination. Useful when splitting procurement across specialized suppliers.
6. What is Source Determination?
Answer:
Process to identify vendor for procurement using Source List, Quota Arrangement, Contract, or Info Record. Important for automatic PO creation and compliance with preferred vendor lists.
7. What is Account Assignment Category?
Answer:
Specifies where costs are posted for a material to be procured: Cost Center (K), Asset (A), Project (P), Sales Order (C). It’s required for consumables and services (no stock) and important for correct FI accounting.
8. Difference between Standard Price & Moving Average Price?
Answer:
- Standard Price (S): Fixed price used for inventory valuation; price variances are posted to price difference accounts. Suitable for stable-priced materials.
- Moving Average Price (V): Average price recalculated on each GR; common for materials with frequent price fluctuation. Interviewers may ask when to use each — manufacturing often uses standard price for costing clarity.
9. What is an RFQ (Request for Quotation)?
Answer:
Document sent to vendors requesting a price quote. After evaluation, you create a PO for selected vendor. RFQ helps negotiation and audit trail of vendor selection.
10. How do you troubleshoot MIGO errors?
Answer:
Steps:
- Check PO/PR details (was the PO closed? correct item?),
- Verify movement type and storage location,
- Check quantity/valuation class and material status,
- Review negative stock setting and authorizations,
- Inspect error message long text and OSS notes (or support docs).
Example: If tax code missing, check vendor master and factory settings.
11. What is Info Update indicator in PO?
Answer:
When checked, PO updates the purchase info record automatically with price or delivery changes after GR/PO. Useful to keep info records current.
12. What is Split Valuation?
Answer:
Allows same material to have different valuation based on criteria (batch, origin, vendor). Each split has separate stock and valuation. Useful when market prices or quality differ by source.
13. What is Blanket PO?
Answer:
Long-term PO for consumables with overall quantity/value and periodic releases. Useful for small frequent purchases avoiding multiple POs.
14. What is Service Procurement?
Answer:
Procurement of services — recorded via service master and service entry sheet. MIRO posts invoice after service entry sheet approval. Examples include maintenance, housekeeping services.
15. What is MRBR?
Answer:
Transaction to release invoices blocked due to price or quantity variances. MRBR helps procurement or AP teams review and decide whether to accept or reject invoice.
16. Why does PO go to “Held” instead of saved?
Answer:
Usually mandatory fields are missing (plant, account assignment, vendor), or validity dates incorrect. Check application logs and required field settings in document type.
17. What is the use of ME2N, ME2L?
Answer:
Reporting transactions: ME2N (PO by PO number), ME2L (PO by vendor). Useful for procurement analysts to pull POs for reconciliation or auditing.
18. What is Tolerance Key?
Answer:
Used to control acceptable variances between PO, GR, and invoice for automatic posting. If invoice variance exceeds tolerance, the invoice is blocked for manual review.
19. How do you handle price changes mid-year?
Answer:
Maintain condition records with validity dates, update info records, or use new contracts with new prices. Communicate changes to procurement and finance for valuation impact.
20. What is a Delivery Schedule?
Answer:
Part of scheduling agreement: specific lines with dates and quantities that guide vendor deliveries. Important in JIT environments or regular replenishment.
SAP MM Interview Questions for 5+ Years Experience
1. Explain the Pricing Procedure in SAP MM.
Answer:
Pricing Procedure controls how the net price is calculated — a sequence of condition types (gross price, discounts, freight, tax). It’s determined via schema determination (purchasing schema group + vendor schema group). Each condition type has calculation rules and account keys mapping to FI accounts. Consultants must know how to add custom condition types and map to GLs.
2. What is Schema Determination?
Answer:
Based on combination of purchasing organization schema group and vendor schema group, the system picks the pricing procedure (schema) that defines which condition types apply and their sequence. Important when different vendors or countries require different tax calculations (e.g., India GST vs export treatments).
3. Explain configuration steps for Release Strategy.
Answer:
- Define characteristics (amount, plant, material group),
- Create classification and assign characteristics,
- Define release groups and release codes,
- Configure release strategy combinations and levels,
- Assign release strategy to document type and group.
Troubleshooting: check characteristic values, check if classification is assigned to document, and if release code entries exist for approvers.
4. What is Material Ledger in S/4HANA?
Answer:
Material Ledger enables actual costing, multi-currency and multi-level valuation. In S/4HANA it’s mandatory and provides real-time price calculations, inventory revaluation, and supports parallel valuation. It affects month-end closing and variance postings.
5. Explain MM–FI Integration.
Answer:
Key interfaces: GR/IR clearing account for goods vs invoice; stock valuation accounts (BSX/WRX) for stock posting; price differences (PRD); account determination (OBYC). When GR posts, inventory and GR/IR are posted; when invoice posts, GR/IR and vendor accounts are cleared – requires correct OBYC and valuation class.
6. Explain MM–SD Integration.
Answer:
Integration points: ATP checks during sales order; stock transfers for delivery; third-party procurement where SD triggers PO in MM; delivery document creation uses MM stock status. Example: SD outbound delivery consumes stock and triggers GI in MM.
7. How do you handle Negative Stock?
Answer:
Negative stock can be allowed at plant or material level (for interim situations). However, it’s risky — accounting reconciliation and MRP planning issues can occur. Best practice is to correct processes to avoid negative stock.
8. What is LSMW used for?
Answer:
Legacy System Migration Workbench (LSMW) automates mass data upload for masters (material, vendor) and transactional data. Useful during cutover to migrate large volumes safely with mapping and conversion steps.
9. Explain Subcontracting Process with configuration.
Answer:
Create subcontracting info record, maintain BOM, create subcontracting PO. Components are issued to vendor (541 movement), vendor returns finished goods and you post GR; system consumes components automatically. Configure movement types and account determination for consumption.
10. How do you resolve GR reversal after invoice posting?
Answer:
Reverse invoice first with MR8M (to clear IR), then reverse GR with MIGO (movement 102). If reversed out of sequence, GR/IR account may be impacted and clearing entries must be corrected.
11. What causes price variance issues?
Answer:
Common causes: incorrect PO price, rounding differences, incorrect tax inclusion, price changes after GR, or incorrect condition records. Fix by correcting PO, releasing blocked invoices, or posting variance adjustments.
12. Explain Third-Party Sales Integration.
Answer:
SD creates a sales order; system creates purchase requisition; PR converts to PO; vendor ships directly; billing handled by SD; goods never post to company stock but invoicing and cost accounting must be reconciled.
13. What is Batch Management?
Answer:
Used to track materials in batches with attributes (production date, expiry). Critical for pharma and food companies in India where batch traceability is legally required.
14. What is SLED?
Answer:
Shelf Life Expiration Date; used for perishable goods to manage consumption and prevent expiry.
15. What is Automatic PO?
Answer:
System-generated PO typically from contract releases or MRP scenarios; helps automate repeated purchases.
16. Explain STO (Stock Transfer Order).
Answer:
STO moves stock between company plants/locations. It can be one-step (no delivery) or two-step (requires transfer posting and goods receipt). Consider transportation planning and valuation differences for cross-company transfers.
17. Explain IDoc types for procurement.
Answer:
ORDERS (PO), INVOIC (invoice), DESADV (advance shipping notice). Used for EDI integration with vendors and third-party logistics.
18. What is PO release not triggering?
Answer:
Causes: missing classification, mismatch in characteristic values, wrong release group or code, or role missing for approver. Debug by simulating strategy and checking change logs.
19. Explain Purchasing Value Key.
Answer:
Used to control auto reminders, monitoring, and delivery tolerances. It’s a control parameter for purchasing orders and follow-on document behavior.
20. What is Condition Technique?
Answer:
SAP method to determine prices/taxes by using condition records, access sequences, and condition tables. It’s widely used in pricing and tax determination both in MM and SD.
SAP MM Real-Time Interview Questions & Answers
1. Describe a real-time PR → PO → GR → IR scenario and what you check when something goes wrong.
Answer: Walk through ME51N → ME21N → MIGO (101) → MIRO. If an invoice is blocked, check MRBR for price/qty variance, verify PO and GR quantities, confirm tax codes (GST) in PO/vendor master, and review GR/IR clearing for mismatches. Example: If MIRO blocks due to price variance, compare PO price vs invoice price and request vendor credit note or update PO if contract allows.
2. A vendor delivered fewer items than PO. How do you handle stock and billing?
Answer: Post a partial GR in MIGO for delivered qty; system updates stock accordingly. Create backorder or confirm outstanding PO qty. When invoice arrives, MIRO will match GR quantity — any invoice for undelivered qty should be rejected. Communicate with vendor for short-shipment note and update delivery schedule if needed.
3. Goods Receipt (GR) posted with wrong quantity — how to correct?
Answer: If invoice not posted: reverse GR (MIGO, movement 102) and repost correct GR. If invoice already posted, reverse MIRO (MR8M) first, then reverse GR and repost both correctly. Document reason and get approvals to avoid audit issues.
4. Invoice blocked in MIRO due to price variance — steps to resolve.
Answer: Check invoice tolerance via OMR6 and vendor tolerance keys. Use MRBR to release blocked invoice after validating with procurement/business. If price is genuinely disputed, negotiate with vendor and raise a credit note; if vendor error, ask reissue.
5. GR/IR account shows uncleared items at month-end — how do you investigate?
Answer: Run transaction F.13 or report MB5S/MB5B to list open GR/IR items. Reconcile PO history (ME23N) and invoices (MIRO). Identify missing invoices or missing GRs. For unmatched items, contact vendor or business to confirm delivery/invoice and post corrections.
6. PO stuck in release strategy — troubleshooting.
Answer: Check classification (Characteristics) on PR/PO, verify release group and release codes, confirm approver user IDs and their release limits, and run release simulation. If characteristic values are incorrect, update classification or strategy. Use ME54N/ME28 for approvals.
7. Negative stock occurred after production — how to handle?
Answer: Investigate cause (delayed GR, incorrect consumption posting). If negative stock allowed temporarily, post missing GRs or correct goods issue. Avoid enabling negative stock as permanent solution — fix process issues (timely GR posting, correct MRP).
8. How do you handle damaged goods received from vendor?
Answer: Post GR with quality inspection lot (Q-GR) or create blocked stock using movement type 551/343 depending on scenario. Create a return PO (or use PO with returns) and notify vendor with a debit note if applicable. Coordinate with quality team for inspection results.
9. Vendor master has wrong GST details discovered after many invoices — remediation steps?
Answer: Update vendor master (FK02/XK02) with correct GSTIN and tax classification; check historical invoices for impact — if GST tax posted incorrectly, raise credit/debit notes and correct accounting via FI. For future prevention, enforce vendor master data validation and mandatory GSTIN field.
10. How to handle GR reversal after IR has been posted?
Answer: Reverse invoice first (MR8M) to clear IR, then reverse GR in MIGO (movement 102). If reversal order was incorrect and postings are messed up, work with FI to adjust GR/IR and vendor reconciliation entries.
11. A PO was created against the wrong vendor — what’s the corrective action?
Answer: If no GR/IR and not approved: change vendor in ME22N (if allowed). If approved or GR posted, cancel PO or create a new PO for correct vendor, reverse GRs and invoices if necessary, and perform inter-vendor adjustments. Document changes for audit.
12. How to resolve MIGO error “material master not extended to plant”?
Answer: Extend material master to plant/storage location (MM01/MM02 → Sales/Plant views) or correct storage location in MIGO. Ensure plant-specific data (MRP, valuation) is maintained before posting.
13. How do you handle a blocked invoice due to missing GR?
Answer: Check PO history for missing GR; either post GR (if goods received) or ask vendor for proof of delivery. If invoice posted erroneously, communicate with AP to block payment until GR is posted or vendor is reconciled.
14. Intercompany STO delivery has incorrect valuation — how to correct?
Answer: Check accounting/reconciliation accounts in OBYC and valuation settings. For cross-company code STOs, ensure correct transfer pricing and intercompany billing configurations. Correct valuation via reversal and reposting with correct account assignments.
15. How to manage consignment consumption and vendor liability?
Answer: Consumption from consignment is posted using movement type 411 (consignment consumption). System recognizes liability to vendor. Reconcile consignment consumption reports and liaise with vendor for monthly billing.
16. Scenario: PO has tax included in price but vendor invoices tax separately. What to do?
Answer: Check PO condition records and pricing procedure. If price includes tax, vendor invoice showing tax separately will cause variance; decide whether to accept invoice with tax and adjust PO or request vendor correction. Use MRBR if necessary after validation.
17. How do you handle goods received but GR not recorded due to offline delivery?
Answer: Post GR manually in MIGO when physical goods are received. For high-volume scenarios, set up EDI/ASN (DESADV) to auto-post GRs or use delivery note capture processes. Ensure stock is updated before production consumes it.
18. Vendor sent multiple invoices for a single PO line — handling steps?
Answer: Verify if invoices are for partial deliveries (each matched with GRs). If duplicate, block in MIRO and query vendor. Use invoice verification and payment block until resolved. Create a credit note if double-charged.
19. How to resolve price variance hitting price difference account during month-end?
Answer: Identify root cause: PO price vs GR price mismatch, currency rounding, freight allocation. Post corrective entries or adjustments via movement types or manual postings with proper approvals. Use Material Ledger and actual costing for deeper analysis in S/4HANA.
20. What steps when MRP generates unexpected PRs for obsolete material?
Answer: Investigate MRP type and planning horizon, check BOM and demand elements, confirm consumption data. Set material to inactive in MRP or change MRP type to manual, and delete/remove PRs if irrelevant. Communicate with planning team.
21. How to handle a stuck background job that creates POs automatically?
Answer: Check SM37 for job status, review job log for errors, stop job if causing issues, debug batch program variant (LSMW/BDC or custom Z program), and correct master data (info records/conditions) causing bad POs. Re-run job after fixes.
22. How to fix wrong GL mapping causing stock postings to wrong accounts?
Answer: Review OBYC account determination settings and valuation class in material master. Correct OBYC entries, post correction journals to move balances to correct GLs, and perform inventory reconciliation.
23. Vendor returned goods to you — how to post?
Answer: For returns to vendor, use MIGO with movement type 122 (return to vendor) referencing original PO. Ensure credit memo is received and processed via MIRO/credit memo functionality.
24. How do you trace missing material documents for audit?
Answer: Use MB51 (material documents) and MB5B/MB51 filters (material, date, movement type) to trace postings. If missing, check change logs, transport requests, and discuss with basis/ABAP for potential table inconsistency and apply corrections.
25. Scenario: Invoices posted with wrong tax code across multiple POs — bulk fix approach?
Answer: Identify affected invoices via SE16N/FF_5 reports, reverse incorrect invoices (MR8M) in bulk (careful), fix master data/tax determination, and re-post corrected invoices. For many records, consider LSMW/BAPI for mass reversal and reposting with controls to avoid payment errors.
26. (Bonus) How to handle vendor self-billing or e-invoicing compliance in India?
Answer: Configure e-invoicing/GST flows: ensure vendor GSTIN, invoice formats align with e-invoice schema, and integrate with IRP/GSTN if required. Implement workflows for vendor self-billing with proper authorization and reconciliation.
SAP MM Consultant Interview Questions and Detailed Answers
A. CLIENT HANDLING & PROJECT IMPLEMENTATION
1. Explain your end-to-end implementation experience in SAP MM. What were your responsibilities?
Detailed Answer:
I worked on full-cycle SAP implementation following the ASAP / Activate methodology. My responsibilities included:
1. Requirement Gathering (AS-IS Study)
- Conducted workshops with procurement, stores, finance, quality, and planning teams.
- Documented AS-IS business processes, pain points, and compliance issues (GST, audit gaps).
2. TO-BE Process Design
- Designed optimized business processes in SAP (PR → PO → GR → IR → Payment).
- Performed GAP analysis and created functional design documents.
3. Configuration
- Configured enterprise structure, number ranges, document types, release strategies, pricing procedures, tax conditions, partners, and account determination (OBYC).
4. Integration
- Worked with FI, SD, PP, WM, and QM teams for cross-module scenarios like STO, QM inspection, and subcontracting.
5. Testing
- Prepared test scripts.
- Executed Unit Testing, Integration Testing, and supported UAT.
6. Cutover
- Migrated Material Master, Vendor Master, Open POs, and inventory balances.
- Helped with LSMW / BAPI uploads.
7. Go-Live & Support
- Handled post go-live issues, training, SOP creation.
- Provided stabilization support for 3–6 months.
2. How do you gather business requirements from clients?
Real Consultant Answer:
I follow a structured approach:
- Workshops – Understand business processes end-to-end.
- Stakeholder Interviews – Procurement head, store managers, finance controllers.
- Document Collection – Current PO formats, contracts, GST invoice formats.
- Process Mapping – Use tools like Visio/Miro to map flows.
- GAP Analysis – Identify gaps between current processes and SAP best practices.
- Prioritization – MoSCoW (Must-Have, Should-Have, Could-Have).
- Sign-Off – Document functional requirements in BRD/FS.
Tip: Always ask for exceptions, not just happy-path scenarios.
3. How do you handle conflicting requirements from multiple stakeholders?
Answer:
- Conduct alignment meetings.
- Present impact analysis for each conflicting requirement.
- Offer SAP best-practice recommendations.
- Use decision matrices and get approval from business process owner.
- Document everything in CR or Functional Specification.
4. Explain your Functional Specification (FS) preparation approach.
Answer:
My FS includes:
- Objective (What needs to be achieved)
- Current issue / GAP
- Detailed requirement
- Field mapping & logic
- Technical specification for ABAP (exit, BADI, enhancement)
- Screenshots & sample data
- Error handling
- Test cases
- Impact on other modules
I ensure both functional and technical teams clearly understand it.
5. Describe a challenging production issue you handled.
Example Answer:
We faced a price mismatch issue where MIRO was posting incorrect GST values.
Root cause: Vendor master had wrong GST classification, and pricing procedure had a missing condition.
Fix:
- Corrected vendor GST classification.
- Updated tax codes and condition record.
- Reprocessed blocked invoices via MRBR.
- Documented RCA and communicated to users.
6. How do you handle change requests (CRs)?
Answer:
- Capture requirement in CR format.
- Perform impact analysis (config, testing, authorization).
- Estimate timeline & effort.
- Get approval from change advisory board.
- Move changes via DEV → QA → PROD.
- Update training materials and user guides.
7. How do you conduct User Acceptance Testing (UAT)?
Answer:
- Prepare detailed test scripts.
- Train users on test cases.
- Track defects in JIRA/ServiceNow.
- Provide daily status reports.
- Ensure sign-off before go-live.
8. How do you work with cross-functional teams (FI, SD, PP, WM)?
Answer:
- Conduct integration meetings.
- Share config changes and their impact.
- Perform end-to-end testing with FI (OBYC, GR/IR), SD (third-party), PP (BOM), WM (bin management).
- Coordinate fixes in shared processes.
9. What are your SAP MM Cutover Activities?
Answer:
- Clean up master data.
- Upload Material Master / Vendor Master.
- Upload Open POs & Scheduling Agreements.
- Upload initial stock (561 movement).
- Reconcile stock & valuation reports.
- Freeze transactions during cutover window.
10. How do you track issues during implementation?
Answer:
Using tools like:
- JIRA
- ServiceNow
- Excel issue tracker
- Daily status meetings
Each issue gets a severity, owner, target date, and RCA.
B. CONFIGURATION & TECHNICAL — DETAILED ANSWERS
11. Explain Release Strategy configuration.
Answer:
Release Strategy is configured using:
- Characteristics (CEKKO fields like plant, value, PR type).
- Class (grouping characteristics).
- Release Group
- Release Codes (approvers).
- Release Indicators (blocked → released).
- Release Strategy (combination of criteria).
Troubleshooting:
- Check classification values.
- Check if PO value exceeds release thresholds.
- Check document type and release group.
12. Explain MM Pricing Procedure configuration.
Steps:
- Define Condition Types (PB00, FRA1, JIGT…).
- Assign Access Sequences (for condition search).
- Define Calculation Schema (Pricing Procedure).
- Create Schema Group Vendor & Purchasing Org.
- Do Schema Determination (combination selects pricing procedure).
- Map to Account Keys (BSX, WRX…).
Example: GST requires IGST/CGST/SGST condition types.
13. Difference between Account Assignment Category & Item Category.
Item Category (controls procurement type):
- Standard
- Subcontracting
- Consignment
- Third-party
Account Assignment (controls where cost posts):
- K (Cost Center)
- A (Asset)
- P (Project)
- C (Sales Order)
14. Release Strategy not triggering — how do you debug?
Checklist:
- Check classification values in PO/PR (ME23N → Release Strategy tab).
- Run simulation (CL30N).
- Check Release Group and Document Type.
- Check characteristics (correct data type, value).
- Check version management.
- Ensure vendor isn’t marked for automatic release.
15. Explain Subcontracting Process Configuration.
Steps:
- Create Subcontracting BOM.
- Create Info Record with subcontracting indicator.
- Create Subcontracting PO.
- Issue components via movement 541.
- Vendor returns finished product (GR 101).
- System automatically performs component consumption.
Often used in India for textile, pharma packaging, auto parts processing.
16. Explain Material Ledger in S/4HANA.
Answer:
Material Ledger is mandatory and provides:
- Actual costing
- Multi-currency valuation
- Parallel accounting
- Real-time profitability
Material Ledger revalues inventory after period-end using actual prices.
17. How do you configure GST in SAP?
Steps:
- Define condition types (JCGT, JSGT, JIGT).
- Assign access sequences.
- Maintain GST tax procedure.
- Map account keys to GL accounts.
- Configure tax codes for IGST/CGST/SGST.
- Maintain vendor GSTIN in master record.
- Test PO → GR → IR scenario.
18. How do you configure account determination (OBYC)?
Answer:
- Map Valuation Class → Account Category Reference → GL.
- Configure keys like BSX (inventory), WRX (GR/IR), GBB (consumption), PRD (price differences).
- Validate by simulating GR/IR postings.
19. What is Valuation Class?
Answer:
Valuation Class links materials to GL accounts.
Example:
- Raw Materials (3000)
- Finished Goods (7920)
Used in OBYC via account category reference.
20. How do you ensure correct price control?
Answer:
Price Control is set in Material Master (V for MAP, S for Standard Price).
Standard Price:
- Used for finished goods for cost roll-up.
MAP:
- Used for purchased materials with fluctuating prices.
Consultants ensure price control matches costing strategy.
21. Explain S/4HANA Business Partner setup for vendor.
Answer:
- BP role → FI Vendor
- BP role → Supplier (Purchasing)
- Maintain:
- General data
- Company code data
- Purchasing org data
- Assign number ranges
- Ensure vendor grouping matches BP grouping
- Maintain GSTIN in Identification tab
22. Common Enhancements/BADIs used in MM.
Examples:
- ME_PROCESS_PO_CUST → PO validation
- ME_PURCHDOC_POSTED → custom notifications
- MB_DOCUMENT_BADI → control goods movement
- MRM_HEADER_CHECK → custom invoice checks
- EXIT_SAPLMEPO → PO custom fields
23. Configure automatic PO from PR.
Conditions:
- Material master: Automatic PO = Yes
- Vendor master: Purchasing data maintained
- Valid Info Record exists
- Source List marked as fixed
- PR contains source of supply
C. SUPPORT, TROUBLESHOOTING & REAL-TIME ISSUES
24. How do you resolve GR/IR imbalances?
Answer:
- Run MB5S or MR11.
- Identify mismatched GR/IR items.
- Check PO history (ME23N).
- Post missing GR or IR.
- Reverse wrong GR/IR.
- Perform clearing (F.13).
- Document adjustments for audit.
25. How to handle price variance during MIRO?
Answer:
- Check if invoice price is within tolerance.
- If variance allowed → MRBR release.
- If wrong PO price → adjust PO (ME22N).
- If vendor mistake → ask for credit note.
In S/4, Material Ledger helps identify reasons for variance.
26. How do you fix stuck IDocs?
Answer:
- Check WE02/WE05.
- Identify error segment.
- Fix partner profile if incorrect.
- Correct master data (vendor, plant, PO).
- Reprocess via BD87.
27. How do you troubleshoot MIGO errors?
Answer:
Common checks:
- Material not extended to plant
- Storage location incorrect
- Movement type blocked
- Batch required but absent
- Serial number missing
- Stock inconsistency
Run MMBE/MB52 to validate stock.
28. Why isn’t PO price updating despite updating Info Record?
Answer:
Because existing PO takes price from IR only during creation. After creation, price is NOT automatically updated unless:
- Delete price conditions and re-adopt via “Update Conditions”
- Or recreate PO item
- Or use mass update via MEI1
29. How to handle duplicate invoices or wrong GST code in MIRO?
Answer:
- Reverse invoice → MR8M
- Correct PO tax code
- Re-post MIRO
- For duplicates, AP team blocks payment & requests credit note
30. How do you manage Physical Inventory differences?
Answer:
- Create Physical Inventory Document (MI01)
- Enter count (MI04)
- Post differences (MI07)
- Reconcile FI/CO impact
- Analyze root cause (leakage, scrap, data errors)
31. User cannot approve PR/PO — what do you check?
Answer:
- Release code missing
- Authorization object: M_EINK_FRG
- Workflow error (SWIA)
- Release strategy not triggered
- Approver not assigned in org structure
32. Vendor evaluation score not updating — how to fix?
Answer:
Check:
- Update flags in customizing
- Weighting factors
- Vendor master purchasing data
- Background job (ME61)
- LIS update (S597 table)
33. PO output form (PDF/Email) not triggering — what do you check?
Answer:
- Condition records in MN04
- Output determination procedure
- Printer settings (SPAD)
- SOST logs
- NACE configuration
- Smartform/Adobe form errors
34. Long-running MRP or PO creation job — how do you handle?
Answer:
- Analyze SM37 logs
- Tune MRP parameters
- Optimize plant parameters
- Split job into smaller variants
- Check master data correctness
- For custom programs → check ABAP performance
35. How do you handle audit requirements for procurement?
Answer:
- GR/IR clearing monthly
- Duplicate PO checks
- Release strategy enforcement
- Vendor contract validity check
- Correct tax code usage (GST)
- Stock reconciliation with finance
SAP MM End-User Interview Questions & Detailed Answers
1. How do you create a Purchase Order (PO)? Explain step-by-step.
Detailed Answer:
To create a PO as an end-user:
- Go to ME21N (Create Purchase Order).
- Select document type (NB – Standard PO).
- Enter Vendor Code.
- Enter Material Number, Quantity, Delivery Date, Plant, Storage Location.
- System pulls price from Info Record or Contract.
- Check taxes (GST code), delivery terms, payment terms.
- Add Texts (delivery details, packing instructions).
- Save the PO — a PO number is generated.
- Send PO to vendor using output type (email/PDF).
Real Example:
You create a PO for “500 kg of Steel Rods” for Plant 1000 with GST 18%.
2. How do you change a PO after saving?
Answer:
Use ME22N (Change PO).
You can edit:
- Quantity
- Delivery date
- Price (if allowed)
- Texts
- Delivery schedule
Some fields cannot be changed if GR already posted.
3. How do you display or check a PO?
Answer:
Use ME23N.
You can check material, vendor, price, tax, GR/IR status, history, and release strategy.
4. How do you create PR (Purchase Requisition)?
Answer:
Use ME51N (Create PR).
Enter:
- Material
- Quantity
- Delivery date
- Plant
- Account assignment (if consumable)
A PR is then approved and converted into a PO.
5. What is the process to convert PR to PO?
Answer:
Use ME57 / ME59N / ME21N:
- Select PR
- Assign vendor
- Adopt line items
- Create PO
Automatic PO can be created if master data is perfect.
6. How do you post a Goods Receipt (GR)?
Answer:
Use MIGO.
Steps:
- Select “Goods Receipt”.
- Choose “Purchase Order” reference.
- Enter PO number.
- Verify quantity, batch, and storage location.
- Post the document.
- A Material Document is generated.
Result:
Stock increases, accounting entry created in GR/IR & inventory GLs.
7. How do you reverse a Goods Receipt?
Answer:
Use MIGO → Cancellation (Movement Type 102).
- Enter the original Material Document number.
- Post reversal.
If invoice is posted, reverse invoice (MR8M) first.
8. What is the difference between MIGO and MB1C/MB01?
Answer:
MIGO is a universal goods movement transaction in SAP (new).
MB1C/MB01 are older legacy transactions — mostly replaced by MIGO.
9. How do you post a Goods Issue (GI)?
Answer:
For consumption to cost center:
Use MIGO or MB1A with Movement Type 201.
Goods Issue reduces stock and posts expense to cost center.
10. What is MIRO (Invoice Posting)? How do you use it?
Answer:
Use MIRO to post vendor invoices.
Steps:
- Enter PO No.
- Check amounts, taxes (GST), freight.
- Verify quantities (must match GR).
- Post invoice.
- System creates accounting document (Vendor liability).
11. How do you reverse an invoice?
Answer:
Use MR8M to cancel incorrect MIRO invoices.
12. What is the GR/IR account? How does it work?
Answer:
GR/IR is a clearing account used between Goods Receipt (GR) and Invoice Receipt (IR).
Example:
- When GR posted → GR/IR CREDITED
- When Invoice posted → GR/IR DEBITED
If they don’t match, GR/IR shows balance.
13. How do you check stock for a material?
Answer:
Use MMBE (Stock Overview).
You can see:
- Unrestricted stock
- Quality stock
- Blocked stock
- Stock in transit
14. What is MB51 used for?
Answer:
MB51 provides list of Material Documents posted for a material or plant.
Useful for audits and stock discrepancy investigations.
15. How do you check the status/history of a PO?
Answer:
Go to ME23N → Purchase Order History tab.
You can see:
- GR details
- IR details
- Reversals
- Delivery completed indicator
16. What is the difference between stock PO and service PO?
Answer:
| Stock PO | Service PO |
|---|---|
| Has material master | No material master needed |
| GR posted via MIGO | Entry Sheet required |
| Inventory updated | No inventory updated |
| MIRO matched with GR | MIRO matched with SES |
17. What is a Service Entry Sheet (SES)?
Answer:
For service PO (e.g., housekeeping, maintenance), SES confirms vendor has completed the work.
Steps:
- ML81N → Create SES → Accept → Save
- Then MIRO posted.
18. What is a Return to Vendor?
Answer:
When material is defective:
- Go to MIGO
- Select Return Delivery
- Use Movement Type 122
- Post document
Vendor sends credit note
19. How do you perform Physical Inventory?
Answer:
- Create PI document (MI01).
- Enter count (MI04).
- Post differences (MI07).
- Inventory updated accordingly.
20. How do you upload initial stock when plant goes live?
Answer:
Use MIGO with Movement Type 561 (Initial Stock).
Only done during Cutover/Go-Live.
21. How do you handle batch-managed materials?
Answer:
Batch needs to be entered during:
- GR
- GI
- Transfer posting
Use batch numbers for traceability (common in pharma, food).
22. What is the use of Movement Type 311?
Answer:
311 = Transfer posting between storage locations of same plant.
Example: SLOC A → SLOC B.
23. What is a Scheduling Agreement?
Answer:
A long-term purchase agreement with:
- Fixed vendor
- Delivery schedules (ME38)
- Regular deliveries
Used for repetitive procurement.
24. What is a Contract?
Answer:
A long-term agreement without delivery schedule.
POs are released against contract.
25. How do you check vendor master data?
Answer:
Use:
- XK03 (Display Vendor)
- BP (S/4HANA Business Partner)
Check GSTIN, payment terms, bank details.
26. What reports do end-users commonly use?
Answer:
- ME2N – PO report by PO
- ME2L – PO report by vendor
- ME80FN – All purchasing documents
- MB5T – Stock in transit
- MB5S – GR/IR report
- MB52 – Stock by storage location
- MRBR – Blocked invoices
27. What is the “Delivery Completed Indicator” in PO?
Answer:
Marks PO as completed even if actual quantity is less.
Helps close PO and avoid unnecessary open commitments.
28. What is a Blanket PO?
Answer:
PO for low-value consumables with:
- Overall limit
- No material master
- No inventory update
Example: Office supplies.
29. How do you block a vendor?
Answer:
Use XK05 or BP (Vendor → Status → Block).
Blocking prevents PO creation & payment.
30. What is a Quotation and how do you compare quotes?
Answer:
RFQ → Vendor quotes → Compare in ME49 (Price Comparison List).
31. How do you check why an invoice is blocked?
Answer:
Go to MRBR.
Check:
- Price variance
- Quantity mismatch
- Missing GR
- Wrong tax code
Fix PO/GR data and reprocess.
32. What is the role of tolerance limits for end-users?
Answer:
Tolerance defines:
- How much price variance allowed
- How much quantity variance allowed
E.g., ±10% tolerance in GR.
If exceeded → invoice gets blocked.
33. What is a Purchase Info Record?
Answer:
Info Record stores:
- Vendor price
- Delivery time
- GST conditions
- Last PO price
Auto-populates PO fields.
34. What is a Source List?
Answer:
Lists approved vendors for a material.
Used to control procurement source.
35. What is Consignment Stock?
Answer:
Vendor-owned stock kept at your plant.
Pay only when consumed (movement 411).
Advantage: Lower working capital.
36. What are Movement Types 101, 102, 122, 161?
- 101 – GR for PO
- 102 – GR reversal
- 122 – Return to vendor
- 161 – Return to vendor after invoice
SAP MM S/4HANA Interview Questions & Detailed Answers
1. What are the major differences between SAP ECC MM and SAP S/4HANA MM?
Detailed Answer:
S/4HANA introduces several simplifications and new capabilities:
Key Differences:
- Business Partner (BP) replaces Vendor Master.
- All vendor data is now maintained via BP transaction.
- Central data model replaces LFA1/LFB1 with BUT000 tables.
- Material Ledger is mandatory.
- Actual costing
- Multi-currency valuation
- Real-time price updates
- Inventory tables simplified.
- MKPF and MSEG replaced by MATDOC.
- Faster postings and real-time analytics.
- Fiori UX replaces traditional GUI screens.
- Fiori apps for PR, PO approval, GR, Vendor evaluation.
- Removed/Obsolete T-Codes.
- MB0A, MB1A, MB1B, MB1C are obsolete.
- MIGO, MIRO, MB52 remain.
- Valuation in Transit, new stock types.
- Advanced MRP (MRP Live) runs on HANA engine.
2. What is the Business Partner (BP) approach in S/4HANA? Why is it mandatory?
Detailed Answer:
Business Partner (BP) is the single point of entry for maintaining vendor/customer master data.
Why Mandatory:
- Harmonizes master data across modules (MM, SD, FI).
- Replaces duplicate tables (LFA1/LFB1/XK01).
- BP supports multiple roles (Supplier, Customer, FI Vendor).
- Supports modern integration scenarios (Ariba, MDG, SuccessFactors).
Process:
- Create BP → General data
- Assign Role: FLVN00 (Supplier – Business Partner)
- Assign Role: FLVN01 (Supplier – FI Vendor)
- Maintain company code & purchasing views.
BP eliminates inconsistencies and enables clean data governance.
3. What is the MATDOC table in S/4HANA?
Answer:
MATDOC is the single line-item document table for material postings.
Advantages:
- Replaces MSEG/MKPF.
- Faster MIGO, MIRO, MRP.
- Supports real-time reporting.
- Less table redundancy.
What moved into MATDOC:
- Material movements
- Stock changes
- Transfer postings
- Reservations
4. Why is Material Ledger mandatory in S/4HANA?
Detailed Answer:
Material Ledger (ML) provides:
- Actual costing → real-time updates of cost.
- Multi-valuations → legal, group, and profit center valuations.
- Multi-currency support → mandatory for HANA.
- Faster period-end closing → eliminates reconciliation issues.
ML enables tracking price changes precisely and supports parallel accounting.
5. What is MRP Live in S/4HANA? How is it different from traditional MRP?
Answer:
MRP Live (MD01N) is the new HANA-optimized MRP run.
Benefits:
- Executes on HANA in-memory
- Very fast even for large plants
- Supports Fiori-based planning
- Reduces database load
- Simplified planning logic
Difference from Classical MRP:
| Classical (ECC) | MRP Live |
|---|---|
| Uses old tables | Uses HANA columnar tables |
| Slower | Very fast |
| Limited analytics | Real-time analytics |
| Complex planning | Simplified rules |
6. What is the new stock type “Stock in Transit” in S/4HANA?
Answer:
S/4 introduces “In-Transit” stock at plant level during stock transfers (STO) without needing delivery notes.
- Separate stock status
- Visible in MMBE
- Real-time valuation
- Simplifies STO process
- Reduces dependency on SD delivery/PGI in certain cases
7. What simplifications were made to Inventory Management in S/4HANA?
Key Simplifications:
- MATDOC replaces 26+ inventory tables
- Faster GR, GI, Transfer Posting
- No cluster table dependencies
- Unified posting method with MIGO
- Simplified physical inventory processing
- Enhanced movement types mapping
8. What is the “Fiori Approval Workflow” in MM?
Answer:
In S/4HANA, PRs and POs can be approved using Fiori apps instead of SAP GUI:
- Approve Purchase Requisition
- Approve Purchase Order
- My Inbox
Benefits:
- Mobile approvals
- Better user experience
- Role-based access
- Real-time notification system
9. What is the new Vendor Evaluation process in S/4HANA?
Answer:
Vendor evaluation integrates with:
- Quality (QM)
- Logistics
- Performance Scorecards
- Automatic scoring based on GR, IR, delivery delays, quality issues
S/4HANA also provides analytical Fiori apps for vendor performance KPIs.
10. Explain S/4HANA Procurement with Ariba Integration.
Answer:
S/4HANA integrates with Ariba via:
- CIG (Cloud Integration Gateway)
- Direct Connectivity (SOAP/REST)
Supports:
- Supplier collaboration
- Sourcing and Contracts
- Catalog procurement
- Invoice automation
Reduces manual work and enhances vendor collaboration.
11. How is GST handled in SAP S/4HANA MM?
Answer:
GST is implemented using condition technique with HANA-optimized tax tables.
Key points:
- Use IGST, CGST, SGST condition types
- Place of supply logic supported
- Integrated with MIRO
- Data flows into GSTR reports
- BP stores GSTIN
- Reverse Charge Mechanism supported
12. What happens to classical transactions like MB1A, MB1B, MB1C in S/4HANA?
Answer:
They are obsolete.
Replaced by MIGO and Fiori apps.
| ECC | S/4 |
|---|---|
| MB1A | Obsolete |
| MB1B | Obsolete |
| MB1C | Obsolete |
13. What are Fiori Apps in SAP MM?
Common Fiori Apps:
- Manage Purchase Orders
- Manage Purchase Requisitions
- Post Goods Movement
- Create Reservation
- Monitor Materials
- Track Purchase Order
- Supplier Evaluation
Advantages:
- Mobile-ready
- Role-based
- Real-time analytics
14. Explain S/4HANA Migration Cockpit (LTMC).
Answer:
It is the tool used to migrate data into S/4HANA without LSMW.
Supports:
- Material Master
- Vendor Master (BP)
- Purchasing Info Records
- Source Lists
- Inventory Upload
LTMC uses predefined templates and is easier and faster than LSMW.
15. What is the role of ACDOCA in S/4HANA and why is it important for MM consultants?
Answer:
ACDOCA is the Universal Journal.
Relevance to MM:
- All MM-related accounting entries flow to ACDOCA.
- GR/IR postings stored in ACDOCA.
- Actual costing uses ACDOCA for reconciliation.
- Simplifies FI–MM integration.
16. What is the impact of S/4HANA on Purchasing Info Records?
Answer:
No major structural changes, but:
- Faster access
- Integration with Fiori
- BP-driven vendor details
- Better price analytics
- New fields for automation
17. How does S/4HANA simplify Source List and Quota Arrangement?
Answer:
S/4HANA supports:
- Fiori-based maintenance
- Faster vendor selection checks
- Better contract/scheduling agreement integration
- Improved MRP vendor assignment
18. Explain the new Output Management using BRF+ in S/4HANA.
Answer:
BRF+ replaces NACE for PO printing/emailing.
Benefits:
- PDF / XML formats
- Cloud integrations
- Web-based rules
- Easier maintenance
- No need for Smartform/NACE condition records
19. What happens to LIS (Logistics Information System) in S/4HANA?
Answer:
LIS is not used; replaced by:
- HANA Live
- CDS Views
- Embedded Analytics
- Fiori Analytical Apps
20. Explain CDS Views in S/4HANA MM.
Answer:
CDS (Core Data Services) views provide real-time reporting capabilities.
Example MM CDS Views:
- I_StockOverview
- I_PurchaseOrderAPI
- I_MaterialDocument
Used for:
- Custom reports
- KPIs
- OData services
- Fiori apps
21. What changes were made to Batch Management in S/4HANA?
Answer:
- Real-time batch classification updates
- Fiori apps for batch management
- Improved batch search functionality
- Enhanced expiry date checks
22. What is “One-Stop Posting” in S/4HANA Inventory?
Answer:
Allows end-users to perform multiple movement types from one screen.
Example:
GR → Putaway → Quality Check from single Fiori screen.
23. Scenario: How do you resolve Material Document posting errors in MATDOC?
Answer:
Steps:
- Check stock consistency → report RM07DOCS
- Execute MB5T, MB52, MMBE
- Use Note Analyzer / SNOTE for MATDOC corrections
- Re-run posting with correct plant/storage/batch
- Reconcile ACDOCA & MATDOC if accounting mismatch
24. Can you use LSMW in S/4HANA MM?
Answer:
LSMW is not recommended.
Use:
- LTMC (Legacy Transfer)
- LTMOM (Migration Object Modeler)
- BAPIs
- SAP Data Services
25. Explain S/4HANA’s enhancements for Inventory Valuation.
Answer:
- Material Ledger mandatory
- Real-time valuation adjustments
- Actual costing at period-end
- Multiple price views
- Simplified valuation categories
- Parallel currencies supported
26. What is the impact of S/4HANA on Physical Inventory?
Answer:
- Faster posting through MATDOC
- Fiori apps for PI counting
- Better analytics
- Simplified recount and posting
27. Explain Valuation Area in S/4HANA.
Answer:
Valuation area remains plant level for most customers.
Company code level available but rare.
S/4HANA impact:
- Supports multi-valuation (legal & group).
- Enhanced valuation categories.
28. What is the impact of S/4HANA on Subcontracting?
Answer:
Enhancements:
- Real-time component consumption
- Fiori “Manage Subcontracting Orders”
- Better visibility of subcontract stock
- Enhanced reporting with CDS views
- Integration with Ariba SCC
29. Explain “Advanced Return Management” in S/4HANA MM.
Answer:
New return process using:
- Return PO
- Inspection lot (QM)
- Logistics follow-up
- Automated refund/credit
- New movement types (e.g., 655)
30. What is the S/4HANA Activate Methodology?
Answer:
Phases include:
- Discover
- Prepare
- Explore
- Realize
- Deploy
- Run
Used for agile-driven S/4HANA implementations.
31. What is an Embedded EWM option in S/4HANA?
Answer:
S/4HANA allows Basic EWM (included for free), offering:
- Advanced warehousing
- Storage bins
- Putaway & Picking strategies
- Physical inventory
- Integration with MM inventory
32. How are PR/PO Approvals improved in S/4HANA?
Answer:
- Workflow via Fiori My Inbox
- Push notifications
- Mobile approvals
- Role-based workflow
- Better audit logs
SAP MM GST Interview Questions & Detailed Answers
1. What is GST and how is it configured in SAP MM?
Detailed Answer:
GST (Goods and Services Tax) is India’s indirect tax replacing excise, VAT, CST, service tax.
In SAP MM, GST is configured using the condition technique, similar to pricing.
GST MM Configuration Steps:
- Define GST Condition Types:
- JCGST (CGST)
- JSGST (SGST)
- JIGST (IGST)
- Assign Access Sequences
- Create Tax Procedure (TAXINN for condition-based logic)
- Assign procedure to Country IN
- Maintain condition records using FV11
- Map condition types to GL accounts via OBYC
- Maintain Vendor GSTIN in BP
- Maintain Material HSN / Service SAC codes
- Test PO → GR → IR scenario
2. What is the difference between CGST, SGST, and IGST in SAP MM?
CGST (Central GST):
Applied when supplier and buyer are in the same state.
SGST (State GST):
Also applies for intra-state transactions.
IGST (Integrated GST):
Applied when supplier and buyer are in different states.
Logic in SAP:
SAP determines the tax automatically based on:
- Vendor’s GST registration (State code)
- Plant’s GST registration
- Ship-to location
3. How does SAP determine GST automatically in a PO?
Answer:
GST determination depends on:
- Vendor Master GSTIN
- Plant GSTIN
- Place of Supply
- Tax Code
- Condition Records (FV11)
- HSN/SAC Code
SAP compares the vendor state code with plant/state code to decide whether CGST+SGST or IGST applies.
4. What are the GST Condition Types used in SAP MM?
Standard GST condition types:
- JCGST – Central GST
- JSGST – State GST
- JIGST – Integrated GST
- JCESS – Compensation Cess (if applicable)
Each condition type has:
- Calculation rule
- Access sequence
- Condition category (Tax)
5. What is the difference between TAXINJ and TAXINN? Which one is used for GST?
TAXINJ:
- Formula-based tax
- Used in old Excise/VAT scenarios
- Not suitable for GST
TAXINN:
- Condition-based tax
- Required for GST
- Uses condition records (FV11)
GST must use TAXINN.
6. What master data is required for GST in SAP MM?
Mandatory Master Data:
- Business Partner (Vendor) GSTIN
- Material HSN Code
- Service SAC Code
- Tax Classification
- Region/State Codes
- Plant GST Registration Number
- Vendor schema group
- Tax code (input GST)
Without these, GST will not be calculated correctly.
7. What is HSN Code and where is it maintained in SAP?
HSN (Harmonized System of Nomenclature) code classifies goods for taxation.
Maintain in:
- Material Master → Basic Data → Control Code (HSN)
- Or, for services: SAC Code
SAP uses HSN/SAC in tax determination.
8. What is Reverse Charge Mechanism (RCM) in GST? How is it handled in SAP MM?
Detailed Answer:
In RCM, the buyer (company) pays GST instead of vendor.
SAP Implementation:
- Vendor is marked as RCM applicable
- Use specific RCM tax code
- GST condition types DO NOT calculate GST in PO
- AP posts GST liability manually or automated through FI
- In MIRO, GST not calculated automatically
- Company later claims ITC (input tax credit)
This is common for:
- Import of services
- Works contracts
- Transport services
9. How is GST calculated for Import Procurement in SAP?
For Imports:
- IGST applies
- Custom Duty + IGST calculated via condition types
- No CGST/SGST
- Use Import PO with pricing schema including:
- Basic Customs Duty
- Social Welfare Surcharge
- IGST on Assessable Value
10. How do you maintain GST rates in SAP?
Use FV11 to maintain condition records.
Steps:
- Enter condition type (JCGST/JSGST/JIGST)
- Enter HSN/SAC code
- Enter vendor/state/plant
- Enter tax percentage (e.g., 9%, 18%)
- Save
11. Why GST is not appearing in PO? Troubleshooting steps.
Check:
- Vendor GSTIN correct?
- Plant GSTIN maintained?
- TAXINN active?
- Tax Code assigned to PO?
- Condition Records maintained?
- HSN code missing?
- Calculation schema incorrect?
- Vendor state = plant state? (for SGST/CGST logic)
12. GST not appearing during MIRO — why?
Common reasons:
- Incorrect tax code
- PO tax conditions deleted
- GR quantity mismatch
- GST schema not active
- Incorrect RCM settings
- GST not maintained for delivery location
13. How do you configure GST calculation schema in SAP MM?
Steps:
- Create GST condition types
- Create access sequences
- Maintain condition tables
- Create tax procedure (TAXINN)
- Assign tax procedure to India
- Assign account keys
- Configure OBYC (tax GL accounts)
- Maintain condition records (FV11)
14. What is Place of Supply and why is it important in GST?
Place of Supply determines which GST applies:
- SAME state → CGST + SGST
- DIFFERENT state → IGST
SAP calculates this based on:
- Vendor state
- Plant state
- Ship-to party address
- Delivery location
15. How does GST work for Subcontracting?
Rules:
- GST applies only on service part
- Not on raw material components
- Finished goods GR triggers GST
- Subcontracting PO must have correct tax code
- BOM items are sent under delivery challan
16. How does GST work for Consignment Procurement?
- GST applicable only when goods are consumed (movement type 411).
- Consignment fill-up does NOT attract GST.
- GST accounted at the time of consumption.
17. How does GST work for Third-Party Procurement?
- Vendor ships directly to customer.
- GST applies based on vendor → customer state codes.
- PO must include correct tax code & HSN.
- Invoice must be GST compliant for claim.
18. GST rounding issues during MIRO — how to resolve?
Fix:
- Check condition type rounding rules
- Use V/06 to adjust decimals
- Update pricing procedure
- Update condition record if required
19. GST condition type not triggering — how do you debug?
Debugging steps:
- Check PO → Conditions tab
- Check analysis (button: Condition Analysis)
- Verify access sequence
- Validate HSN code
- Maintain GST condition record
- Check schema determination
- Ensure tax code assigned
20. Can we calculate GST on freight and other charges?
Yes.
Example:
- Base Price = ₹1000
- Freight = ₹200
- GST = 18%
- GST applies on Basic + Freight
- Set in condition type calculation base
21. How do you configure GST for freight (FRA1)?
- Create separate condition type for freight
- Add access sequences
- Include freight in calculation base for GST condition types
- Maintain condition records
22. How do you view GST details for a PO?
Use:
- ME23N → Invoice tab → Taxes
- Conditions tab
- GST percentage and value visible
- Condition analysis displays calculation logic
23. What is Compensation Cess and how is it configured?
Cess is additional GST for specific items (e.g., tobacco, luxury cars).
Configuration:
- Create condition type (JCESS)
- Maintain cess rate via FV11
- Add to pricing procedure
- Map GL account via OBYC
24. What is the process for handling GST credit (Input Tax Credit)?
Process:
- GST posted during MIRO
- FI posts GST to input credit GL
- Company claims ITC during GST return filing
- Reconciliation done with GSTR-2A data
25. Why does GST calculation differ between PO and MIRO?
Reasons:
- Different rounding rules
- Manual changes in PO conditions
- Vendor invoice includes/excludes freight
- Incorrect tax code
- GST rates updated after PO creation
26. How do you update GST rate change (e.g., from 18% to 12%)?
Steps:
- Update condition records (FV11/FV12)
- New rate applies to new POs
- For existing POs → update manually if necessary
- Inform AP to validate invoices for old POs
27. In GST, what is the impact of credit vs non-credit procurement?
Credit procurement:
- GST posted → ITC claimable
- Enabled via tax code configuration
Non-credit procurement:
- GST posted → NOT claimable
- Separate tax code used
- GL posting differs (expense GL)
28. How does GST apply for Services vs Goods in SAP?
Goods:
- HSN code
- Stock GR (MIGO)
- Invoice via MIRO
Services:
- SAC code
- Service Entry Sheet (ML81N)
- Invoice via MIRO
- GST applies based on SAC code
29. How is GST handled for stock transfer between two states?
Interstate STO → IGST applies
System determines GST based on:
- Supplying plant state
- Receiving plant state
Tax relevant conditions must exist in STO pricing schema.
30. How do you test GST scenarios in SAP?
Test cases should include:
- Intra-state procurement (CGST+SGST)
- Inter-state procurement (IGST)
- Imports
- RCM scenarios
- Subcontracting
- Third-party
- Service procurement
- Freight + GST
- Incorrect GST → MIRO block
- GST rounding validation
31. How do you check GST vendor master data?
BP Transaction → Supplier → Identification Tab
Check:
- GSTIN
- PAN
- State code
- Tax classification
- Legal name
SAP MM Interview Tips
1. Always Start Your Answer With the Real-Time Flow (PR → PO → GR → IR)
Recruiters LOVE this.
Almost 80% of SAP MM interview questions connect to this process.
Whenever asked anything—pricing, release strategy, GST, MIRO—relate it to:
- Purchase Requisition (ME51N)
- Purchase Order (ME21N)
- Goods Receipt (MIGO)
- Invoice Verification (MIRO)
- GR/IR reconciliation
This shows end-to-end process understanding, not just theory.
2. Use SAP T-Codes in Your Answers — Instantly Signals Real Experience
Examples:
- ME21N / ME23N (PO)
- ME51N / ME52N (PR)
- MIGO (GR/GI)
- MIRO (Invoice)
- MRBR (Blocked Invoice)
- MB51 (Material Document)
- MB52, MMBE (Stock)
- OBYC (Account Determination)
- BP (Vendor Master in S/4HANA)
Interviewers immediately trust that you’ve worked hands-on.
3. Include a Real-Time Issue You Solved (Gives 10X Weight to Your Answer)
Example:
“Users reported MIRO price mismatch.
When I checked PO conditions, freight was manually changed, causing GST re-calculation.
I corrected the condition record, updated PO, and cleared blocked invoices using MRBR.”
This proves problem-solving + business understanding.
4. For Configuration Questions — Always Mention “End-to-End Setup”
For topics like:
- Release strategy
- Pricing procedure
- GST configuration
- Account determination (OBYC)
- Subcontracting
- Business Partner setup
Use the structure:
- Define →
- Configuration steps →
- Scenario example →
- Troubleshooting tips
This is the ideal consultant-style answer.
5. For S/4HANA Questions — Always Talk About These 4 Things
Interviewers expect you to know the differences:
- Business Partner (BP) mandatory
- MATDOC replaces MKPF/MSEG
- Material Ledger mandatory
- Fiori apps for procurement
Mentioning these four gives the impression of S/4HANA expertise.
6. For GST Questions — Talk About TAXINN + Condition Types + Vendor/Plant GSTIN
When asked GST-related questions:
Include:
- TAXINN
- Condition types (JCGST/JSGST/JIGST)
- FV11 condition record
- Vendor GSTIN (BP)
- HSN/SAC codes
- Intra-state vs Inter-state logic
- MIRO rounding issues
- Reverse Charge Mechanism
This is must-have knowledge for Indian SAP MM roles.
7. Always Speak in Real Business Examples
Instead of saying:
“Release Strategy is used for approval.”
Say:
“In a pharma company, Purchase Orders above ₹1,00,000 require Plant Manager approval.
We use Release Strategy to implement this control.”
This makes your answer practical.
8. Know the Top 5 Real-Time Support Tickets in MM
You MUST know how to handle:
- Invoice blocked (MRBR)
- Goods receipt reversal (MIGO → 102)
- Wrong tax code in PO
- Stock mismatch (MB52 vs MMBE)
- Material not extended to plant error
Interviewers frequently test real support experience.
9. Learn Common Movement Types — This Is the Most Expected Question
Important movement types:
- 101 – GR for PO
- 102 – GR reversal
- 122 – Return to vendor
- 201 – GI to cost center
- 311 – Transfer between storage locations
- 541 – Subcontracting components
- 561 – Initial stock
10. For Senior Consultants — Show Cross-Module Knowledge
Integrations to highlight:
- MM–FI (GR/IR, OBYC, valuation class)
- MM–SD (third-party procurement)
- MM–PP (MRP, BOM, subcontracting)
- MM–WM/EWM (bins, putaway)
- MM–QM (inspection lots)
Integration knowledge boosts your senior-level credibility.
11. Always Mention Documentation Skills
SAP projects require:
- BRD
- Functional Specification (FS)
- Test Scripts
- KT Documents
- SOPs
- Cutover Checklists
Many candidates ignore this — but interviewers highly value it.
12. Never Say “I Don’t Know” — Use Smart Alternative Phrases
Instead say:
- “I haven’t encountered this exact scenario, but here’s how I would analyze it…”
- “I can logically derive the solution based on similar processes…”
- “Let me think through the business impact…”
This keeps the conversation positive.
13. Avoid These Common Mistakes in Interviews
❌ Saying “MIRO is goods receipt”
❌ Saying “MIGO is invoice”
❌ Confusing TAXINJ vs TAXINN
❌ Saying “Vendor master is maintained in XK01” (in S/4 it’s BP)
Correct answers matter more at MM consultant level.
14. Prepare One Strong Project Explanation
Follow this structure:
- Company industry
- Scope of your work
- Modules involved
- Major processes you handled
- Challenges solved
- Achievements (performance improvement, user training)
15. Demonstrate Communication Skills
Consultants must interact with:
- Users
- Managers
- Vendors
- Functional & technical teams
- Clients
Speak clearly, structure your answers, and use examples.
16. Master TOP 10 Questions Asked in Almost Every Interview
- Subcontracting flow
- Pricing procedure
- Release strategy
- GST configuration
- PR → PO → GR → IR
- GR blocked stock
- Third-party process
- Split valuation
- Info record / source list
- GR/IR clearing
If you answer these well—you crack the interview.
17. Focus on Real-Time Troubleshooting
Examples:
- Price mismatch in MIRO
- Excess quantity blocked in GR
- Material master missing views
- Duplicate invoice posting
- PO output not triggering
- Batch management errors
Interviewers test troubleshooting more than configuration.
18. Always Show Positive Attitude & Ownership
Use phrases like:
- “I take ownership of solving user issues end-to-end.”
- “I work closely with business to understand the root cause.”
- “I always validate in QA before transporting.”
This is what clients expect.
19. Study the Last 3–4 Patch Notes (OSS Notes) for MM
Especially for:
- S/4HANA inventory issues
- MATDOC updates
- GST patches
- Ariba/MM integration fixes
Senior-level interviewers sometimes check this.
20. Practice the STAR Method for Scenario Questions
S – Situation
T – Task
A – Action
R – Result
Use this format to give structured, confident answers.