Evaluated Receipt Settlement - ERS

Evaluated Receipt Settlement (ERS)

Evaluated Receipt Settlement is an alternate way of processing vendor invoices. In this method, instead of vendor submitting the invoices for payment, the company on its own settles the vendor liabilities and presents a payment statement. This method of payment takes the data based on purchase orders and delivered quantities to arrive at the vendor payment amount.

The ERS process gives best results when pricing and goods receipt remains consistent with the Purchase Order created.

ERS has gained popularity owing to the following obvious advantages,

• Reduction in manpower to process invoices
• Timely payment to vendors

SAP Process Flow:

• PO (ME21N) – A tax code should be maintained in the purchase order.
• Goods Receipt (MIGO – Mvt Type – 101)
• ERS Settlement (MRRL) - One can do test run to see the details and thereafter uncheck the test run and do a final run.
• Payment Run
• MR90 (Output messages in logistics invoice verification) – in case there is a requirement to re-send the ERS output message to the vendor.
  Purchase orders which are ERS relevant can only be settled through Evaluated Receipt Settlement transactions (MRRL) in Logistics invoice verification.

To cancel an invoice created through ERS you should first cancel the Goods Receipt and then create invoice through MRRL run, so that accounting entries can be reversed. In a similar manner credit memos can also be created using ERS. If an invoice has already been posted for a goods receipt and goods have since been returned to the vendor, the system on its own generates a credit memo for the returned quantity during the next MRRL run.

Master Data Setting

Vendor Master:

• Purchasing Data tab
  o GR-Based Inv. Verif.
  o AutoEvalGRSetmt Del.
  o AutoEvalGRSetmt Ret

Purchase Info Record:

ERS relevant settings can also be activated / deactivated in a purchase info record for a vendor material combination. The advantage of this setting at Purchase Info Record level is it allows you to prevent certain materials from a vendor as being not relevant for ERS. In other words, Purchase Info Record settings are considered first while defaulting data to a purchase order as compared to vendor master settings.

Output Conditions:

T Code - MRM1 (Create output – condition records: Invoice Verification)
o Output Type = ERS
In this step, you define the message types for ERS. The system can generate and possibly send a message to inform the vendor(s) about the transaction settled, depending on the settings in Customizing. The customizing path is as under:
SPRO>Materials Management> Logistics Invoice Verification> Message Determination > Maintain Conditions

In case re-messaging is required, it can be done using transaction code MR90.