FAQs regarding Receiving process in Ariba

[Praveen_Rohan]

Receiving is the process of confirming that the goods or services ordered from a supplier have been delivered and are satisfactory. It is an essential function in the P2P process, both from the audit and compliance perspectives. It ensures that the enterprise is paying correctly to the suppliers based on the actual deliveries received. It also provides a mechanism for returning undesired items. 

Let's dive deep into the Receiving function and understand it using FAQs.

Receiving Methods

Q - I can I do Receiving in Ariba?

A -  Please see below the receiving methods available in Ariba.

1. Automatic receiving - Enables Ariba to create receipts automatically based on specific configurations.
2. Manual Receiving - In this method, the users manually create a receipt that indicates the extent to which the order was received. Users can also revise the quantity/amount downward by entering negative values, as you might reject some items. 
3. Line-level receiving: In this method, receipts are created in the ERP system and imported into Ariba as proof of records.

Manual Receiving Method -

Q - Who can do manual receiving in Ariba ?

A - Manual receiving in Ariba is done through any of the two Manual Receiving Types

1. Desktop receiving—In this type, the Casual user (who must have the Purchasing User group assigned) can receives the goods and create Receipts.
2. Central Receiving – Receiving is done by the team/member who must have a Receiving Manager or Receiving Agent group assigned in Ariba. 

Q - I don't want my casual users to be bothered about receiving all the times, Can I leverage my Central receiving team when required ?

A - Of course, you can formulate a strategy for what categories you want casual users to receive and what should be received by the central team. The default configuration supports central receiving based on commodity code. Users who are members of a specific group receive goods that have a specific commodity code. For example, the IT department is in charge of receiving all IT-related items and then distributing them to the end users.

Q - Can I receive multiple orders simultaneously when manually receiving?

A - Yes, you can receive multiple orders simultaneously, provided the orders don't require additional data entry. However, If any order requires asset or other data entry in the receipt, you're notified to enter individual receipts for those items.

Q - Can I create multiple receipts for a PO?

A - Yes, you can create multiple receipts for a PO, this is called partial receiving. If the order is partially received you must create additional receipts as you receive additional line items.

Q - Can I create one Receipt for multiple PO in Ariba?

A - While partial receiving, creating multiple receipts to fulfill a PO, is supported in Ariba; a single receipt for multiple purchase orders is not allowed.

Q - WHAT are the different types of manual receipts that can be created in Ariba?

Below are the Manual Receiving Types available in Ariba

1. Manual Receive by Quantity - Here user manually receive the item by quantity. This is the Default receiving type
2. Manual Receive by Amount - Here user manually Receive by amount in base currency such as USD.

Q - How do I determine the right manual receiving type for my organization?

Organizations generally use quantity-based receiving for goods items and amount-based receiving for service items. 

Q - Do you have a workflow diagram for Manual Receiving for better understanding?

Automatic Receiving Method -

Q - How do I decide if my company should go for automatic receiving or receive the goods manually?

A - Good question, Let me share with you the below use cases that drives the use of automatic receiving of goods -

1. Use auto-receive to eliminate time spent on data entry for low-value receipts
2. Use auto-receive to reduce the risk of pending payments for small invoices awaiting a manual receipt.

Q - Can I do manual receiving for a commodity marked as auto-receive to make corrections?

A - Yes, you can and this is a valid business scenario. To achieve this, when you manually receive a line item initially configured for auto-receiving, Ariba converts the receiving type for that line item to a manual receipt type. Note, this doesn't impact the receiving type configured for that commodity in other PO.

Q - Can I change the PO or cancel it entirely after it's auto-received?

A - Yes, you can change/cancel an auto-received PO. To do so, you need to manually create negative receipts for the PO, which converts it to a manually received PO. Once done, you can choose to either change or cancel such purchase orders.

Q - What are the different ways I can configure automatic receiving in Ariba?

A - Receipts are automatically created based on auto-receiving configuration. Ariba offers the below auto-receiving types options -

1. Auto Receive below a specific amount: Items of lower dollar value will be auto-received. If the receipt value exceeds the specific dollar amount, someone must manually receive the item.
2. Auto-receipt on due date: Ariba automatically generates a receipt on the order due date.
3. Auto-receipt on order date: Ariba automatically generates a receipt when the item is ordered.
4. Auto-receipt on invoice or charge reconciliation: Ariba automatically generates a receipt when either an IR document or a charge reconciliation document is generated.

Q - How do I know my order's due date, required for automatic receiving?

A - Auto-receipt on the due date is the ideal configuration for receiving catalog items automatically, where the due date is calculated based on catalog item lead time. For non-catalog items, the default lead time parameter is zero in Ariba.

Line-level Receiving Method -

Q - Some users in my organisation are in Ariba as well as the ERP. Can they receive goods partially in Ariba and ERP?

A - Yes, Line-level receiving method in Ariba enables users to receive items in ERP and/or Ariba. Receipts can be handled for a PO using a combination of manual and imported receipts. Ariba offers below options, which enterprises can choose depending on the business rule and the use case

1. line-level receiving in the enhanced mode -
   1. Users can create receipts in Ariba by importing receipt data from external ERP systems.
   2. Application.Receiving.AllowReceivingByUserInterfaceAndReceiptImportEnhanced parameter (set by SAP) must be enabled to create receipts in multiple ways for a PO line.
2. line-level receiving, without the enhanced mode -
1. Users can create receipts for a PO line item either in Ariba or by importing receipts, but not both.
2. A member of the Customer Administrator group sets this parameter in the ICM - Application.Receiving.AllowReceivingByUserInterfaceAndReceiptImport ;

1. When set to Yes, receivers can create receipts either in the buying solution or by using imported receipts, but not both.
2. When set to No, the way receivers can create receipts depends on how the first receiving transaction is processed.

Q - As Ariba Admin, how do I configure Receiving process in Ariba ?

1. Auto-receiving can be enabled based on item's supplier part number or commodity code.
2. Configure threshold amounts for specific commodities and supplier part numbers so that the items are auto-received only if the PO line is under the specified threshold amount.
3. Ariba also offers flexibility in determining the Receiving types based on specific fields in the requisition, including custom fields.
4. Tolerance settings are used to control over- and under-receiving orders.

Q - How can I make an item be received automatically for low values while manually receiving high values for the same category?

A - Amount thresholds determine whether PO items are auto-received or manually-received. Ariba  automatically receives PO lines with an amount less than or equal to the threshold amount.

There are two ways to configure amount thresholds for auto-receiving:

1. You can configure auto-receiving amount thresholds for order lines based on commodity code or supplier part number. This way, the amount threshold for one commodity code or part number can be different from the threshold for another commodity code or part number.
2. SAP Ariba Customer Support can configure site-wide amount thresholds at the order and line levels. These site-wide thresholds apply to all lines and orders, regardless of commodity code or part number.

Q - I want to set the receiving type for a commodity as auto-receiving; however, I want to configure manual receiving for a particular part number belonging to that commodity. Is it possible?

A-We understand that such business requirements are often required. Hence, Ariba offers this functionality: for a particular item, the receiving type associated with the part number takes precedence over the receiving type associated with the commodity code.

Example : You can configure Notebook computers (UNSPSC# 43211503) for auto-receiving. However, you can add an additional configuration that Part # starting with APPLE% always require manual receiving despite it belonging to the 'Notebook computers' commodity.

Under & Over Receiving

Q - Can I receive more than the quantity/amount ordered?

Yes, Buyers can receive more or less than the ordered quantity, depending on business needs. Ariba provides the under-receiving and over-receiving functionality.

In general, the quantities and amounts on a receipt are expected to match those on the purchase order. However, sometimes you may receive fewer items or for a lesser amount than what was specified on the purchase order (under-receiving), or you may receive more items or for a higher amount than on the purchase order (over-receiving). This is possible for different use cases such as price fluctuation, suppliers sending additional quantities to makeup for any damages etc.

Q - Is there a limit to how much I can under/over-receive?

Yes, such limits are governed by the receiving tolerance configured in Ariba. The purchase order will be considered fully received if you submit receipts for quantities and/or amounts within the configured tolerance limits.

Tolerance can be defined based on -

1. Absolute Quantity
2. Value (Line Item Amount)
3. Percentage of Qty/Amount

Q: Do I need to meet all the above-listed tolerances for receiving, or is meeting any one is enough?

Your site can be configured so that absolute and relative tolerances must be met for a receipt to be fully received, or either one of the tolerance settings must be met for the receipt to be complete.

Here is a very good example to explain this - Example for under & over Receiving 

Q—So far, so good; however, in a complex business scenario where a company has several subsidiaries that functions as independent purchasing units, the receiving behavior for such subsidiaries may differ from that of the parent company. How do we deal with such a difference in receiving tolerance requirements?

A - To facilitate such differences at the purchasing unit level, you can configure the receiving tolerances specific to each purchasing unit. The Purchasing unit hierarchies for receiving tolerances are not supported, hence, please configure the tolerance for each PU; otherwise, the receiving tolerances that are configured at your site level will be applicable for such unconfigured purchasing units.

Receipt Information Sent to Suppliers

Q - How do I inform my suppliers that I have received the items?

A - You can configure your buying solution to send receipt information to SAP Business Network, allowing suppliers to view the approval status of receipts and receipt information, such as the number of items accepted or rejected.

A member of the Customer Administrator group sets this parameter in ICM - Application.Receiving.SendReceiptsToAribaNetwork

Q - Why does SAP recommend to send receipt information to my suppliers?

A - With receipt information available on SAP Business Network, suppliers can view the status of receipt transactions and create invoices based on actual receipts. This enables quicker transaction closure and reduces receipt-related exceptions while reconciling invoices.

Asset Data on Receipts

Q - I order a lot of items which are of type Assets. Can I receive Assets in Ariba?

A - Yes, Ariba supports Asset-receiving functionality. Asset receiving in Ariba allows asset data (for example, asset serial number and tag number) to be added to the receipt line items identified as assets.

Q - How do I configure categories/part # as Assets in Ariba?

A - A receipt line item is identified as an Asset based on the Part Number or Commodity Code. If the asset data feature is enabled on your site, adding asset details to the corresponding items in the receipt is mandatory before it is approved.

The Import Receiving Types By Commodity Code data import task lets you specify which commodity codes require asset data information while The Import Receiving Types By Part Number data import task lets you specify which part numbers require asset data information.

You can add asset data in one of the following ways (Help link included) :

1. Manually, for each received item – The procedure is described here. Specifying Asset Data Manually for Received Items
2. By importing asset data from an Excel template. The procedure is described here: Specifying Asset Data Using an Excel Template.
3. Automatically based on the value set in the Application.Procure.DefaultAssetDataSize (Set by SAP Ariba Support) parameter. Details can be seen here -  DefaultAssetDataSize.

Q - Who can add the asset data to the receipts before they are sent to the ERP for processing?

Either the requester or any one of the approvers must ensure that asset data is specified before the receipts are fully approved and sent to the ERP.

Typically, the main receiver adds asset data at the time of receiving, but this data may not always be accurate. To ensure accurate information is provided, you can add Asset Receiver group to the approval flow.

The asset receiver can then review the specified asset information, change it if necessary, and approve the receipt.

Additional Information :

In the default configuration, when asset data is enabled for receiving, an asset receiver or the customer administrator is automatically added at the end of the receipt approval process. This ensures that asset data is specified before the receipt is fully approved.

An exception is raised if the asset receiver tries to approve the receipt without adding this asset data.

Q - How can I add Receivers in Ariba to make them responsible for receiving?

A - Designating the "Receiver" in Ariba can be done using the Approval process

• The person or Group responsible for  doing the receiving against a Purchase Order (manual receiving) is designated through a Receipt "Approval" ruleset
• The first "Approver" in the ruleset is the  person who needs to do the receiving (complete the required fields to submit the Receipt)
• The Receipt "Approvals" have the same capabilities as another approval rule, including leveraging Lookup Tables.
• It is not common to require additional Receipt approvals other than for asset-receiving

Q - How can I map receiving types with commodity codes and amount thresholds?

The Import Receiving Types By Commodity Code data import task lets you associate receiving types with commodity codes and amount thresholds. If necessary, you can also configure custom conditions to determine the receiving type based on the fields on the requisition.

Import Receiving Types By Commodity Code reads data from the CSV file ReceiptByCommodityCode.csv.

Q - How can I map receiving types with Part numbers?

The Import Receiving Types By Part Number data import task associates receiving types and amount thresholds with part numbers. Import Receiving Types By Part Number reads data from the CSV file named ReceiptByPartNumber.csv.

Thank you for taking the time to read the blog. I hope it helps you build a business case for choosing Ariba for your receiving process. If you have any questions about the receiving process that aren’t covered here, please feel free to send them to me. I’d be happy to add them to the FAQs for everyone’s benefit.