Origin Acceptance Process in SAP S/4HANA – Step-by-Step Guide with 107 & 109 Movements

[Leelamohan]

✍️ Introduction

Origin Acceptance allows materials to be inspected and accepted at the supplier’s location, ensuring that only compliant goods are released for use. From a system perspective, SAP manages this through special goods movements (such as 107 and 109) that clearly distinguish between financial ownership and physical receipt, providing transparency across logistics and finance.

💼 Business Example

Consider a manufacturing company sourcing precision-engineered components from an overseas vendor. These components are expensive, quality-sensitive, and must comply with strict technical specifications.

Instead of waiting for the goods to arrive at the plant and then performing quality checks, the company:

• Enables Origin Acceptance at the material master level
• Performs inspection at the vendor premises
• Posts a 107 movement to record valuated stock while the goods are still in transit
• Releases the stock for use only after physical receipt via 109 movement

This approach helps the business:

• Avoid rejections and return logistics after delivery
• Ensure early financial visibility of procured inventory
• Maintain tighter quality control and compliance
• Improve warehouse planning and production readiness

In the rest of this blog, we’ll explore the step-by-step configuration and execution of the Origin Acceptance process in SAP S/4HANA, from material master setup to stock and accounting impact, using standard SAP transactions and best practices from Sourcing & Procurement.

Step 1: Define Structure of Data Screens for Each Screen Sequence (Transaction: OMT3)

To use Origin Acceptance, the indicator must be visible and editable in the Material Master – Purchasing View.

SPRO Path: SPRO → Logistics – General → Material Master → Configuring the Material Master → Define Structure of Data Screens for Each Screen Sequence (OMT3)

🔎 Why this step is important:
Without this configuration, the origin acceptance indicator cannot be maintained at the material level, making the process unavailable during procurement.

Here, the purchasing screen sequence is adjusted so that the Origin Acceptance field appears in the relevant sub-screen.

Step 2: Create Material Master Record - Activate Origin Acceptance

In the Purchasing View of the material master, enable the Origin Acceptance indicator.

This setting ensures that whenever the material is procured, SAP enforces origin-based inspection and restricts standard goods receipt postings.

📌 Key Control:
Once activated, the system will block standard 101 Goods Receipt, forcing the use of special movements (107/109).

Step 3: Create Purchase Requisition (Transaction: ME51N / Manage Purchase Requistion)

Create a purchase requisition for the material with origin acceptance enabled.

The PR behaves like a standard procurement document, but the origin acceptance requirement flows automatically into subsequent documents.

🧠 Business Perspective:
At this stage, procurement planning remains unchanged, ensuring no disruption to purchasing operations.

Step 4: Create Purchase Order (Transaction: ME21N / Manage Purchase Order)

Create the Purchase Order with reference to the PR.

In the Item Details → Delivery tab, verify that the Origin Acceptance indicator is active.

✔️ This confirms that the PO is subject to inspection at the supplier’s premises.

Step 5: Check Stock Status before positing GRN (Transaction: MMBE)

Before posting any goods movement, check stock using MMBE.

You’ll typically observe:

• Unrestricted Stock: Existing quantity

• On-Order Stock: Quantity from the open PO

📊 This gives clarity on current availability versus expected receipts.

Step 6: Attempt Goods Receipt - System Restriction (Transaction: MIGO / Post Goods Movement)

When attempting to post a 101 Goods Receipt, SAP will block the transaction.

🚫 System Behavior:
Because origin acceptance is active, SAP does not allow direct posting to unrestricted stock.

✔️ This enforces inspection at the source before goods are made available for use

when you perform check

Step 7: Post Goods Receipt with Movement Type 107 (MIGO)

Change the movement type to 107 – GR to Valuated Stock in Transit and post the document.

What happens at this stage:

• Stock is recorded as Receiving Valuated Stock in Transit
• Accounting entries are generated
• Ownership is transferred, but goods are not yet physically received

💰 Financial Impact:
Stock and GR/IR accounts are updated, providing early financial visibility.

Step 8: Check Stock after 107 Posting (MIGO)

After posting movement 107:

• Quantity appears under Receiving Valuated Stock in Transit
• No increase in unrestricted stock

📦 This reflects goods accepted at origin but still in transit.

Step 9: Post Movement Type 109 - Release Stock for Usage (MIGO)

Once the goods physically arrive at the warehouse/location, post movement type 109 with reference to the same PO.

System Impact:

• Stock moves from Valuated Stock in Transit to Unrestricted Use
• ❌ No accounting document is generated (already posted during 107)

🧾 This step purely represents logistical receipt, not financial posting.

Step 10: Final Stock verification (Transaction: MMBE)

After movement 109:

• Stock is available in Unrestricted Use
• Materials can now be consumed in production or sold

✅ The Origin Acceptance cycle is now complete.

🔑 Key Takeaways from the Process

• Origin Acceptance separates financial ownership from physical receipt
• Quality checks are completed before goods reach the warehouse
• Movements 107 and 109 ensure transparency across MM and FI
• Ideal for high-value, regulated, or quality-sensitive materials

If you found this guide helpful, don’t miss my other SAP MM WM blogs covering real-world automation, configuration tips, and best practices for procurement, inventory management, and warehouse management.

Click to view other SAP MM WM Blogs - SAP Community

Regards,

Leelamohan