1. Procure to Pay
Enterprise Structure Modeling Options

2. Option 1: Centralized Requisitioning, Procurement, Payables, Materials Management (PC BU <> Management BU)
General Recommendation:
1 Ledger and 1 FIN BU, Multiple LEs per country
All Legal Entities Serviced by one Payables BU
US GAAP Primary
Supplier Site Assignment
Procurement BU: Service BU1
Requisition BU
Payables BU
Service BU1
LE2
Default LE
LE1
LE3
Profit Center 2
Below LE: Y
Business Functions
Materials Management*
Profit Center 3
Below LE: Y
Business Functions
Materials Management*
Profit Center 1
Below LE: Y
Business Functions
Materials Management*
Service BU 1
Business Functions
Requisitioning
Materials Management
Payables
Procurement
Inventory Org 1
Inventory Org 2
Inventory Org 3
Management BU
*Profit Center Business units are BU that rolls up to one legal entity. Such business unit is the management owner of revenue and costs generated by the associated inventory organizations.
Generally there is a manager with P&L responsibility for such profit center. There are no additional setups involved in Payables or purchasing involving the profit center BU. These are light weight tracking entities. However,
these can be used to model inter or intra company supply chain flows using transfer pricing. They need ‘Materials Management’ function just to enable ‘Below LE’ flag on the definition. Enabling the flag sets it up as profit center.

3. Option 2: Centralized Procurement, Payables, Decentralized Requisitioning, Materials Management (PC BU = Management BU)
General Recommendation:
1 Ledger and 1 FIN BU, Multiple LEs per country
All Legal Entities Serviced by one Payables BU
US GAAP Primary
Supplier Site Assignment
Procurement BU: Service BU 1
Requisition BU
Payables BU
Profit Center 1
Service BU1
Profit Center 2
Profit Center 3
Default LE
LE1
LE2
LE3
Profit Center 2
Below LE: Y
Business Functions Materials Management Requisitioning*
Profit Center 3
Below LE: Y
Business Functions Materials Management Requisitioning*
Service BU1
Business Functions
Payables
Procurement
Profit Center 1
Below LE: Y
Business Functions Materials Management Requisitioning*
Management BU
Management BU
Management BU
Inventory Org 1
Inventory Org 2
Inventory Org 3
*Profit Center Business units are BU that rolls up to one legal entity. Such business unit is the management owner of revenue and costs generated by the associated inventory organizations.
Generally there is a manager with P&L responsibility for such profit center. There are no additional setups involved in Payables or purchasing involving the profit center BU. These are light weight tracking entities. However,
these can be used to model inter or intra company supply chain flows using transfer pricing. They need ‘Materials Management’ function just to enable ‘Below LE’ flag on the definition. Enabling the flag sets it up as profit center.

4. Option 3A: Centralized Procurement, Semi Centralized Payables, Requisitioning, Materials Management (PC BU <> Management BU)
General Recommendation:
1 Ledger and 1 FIN BU, Multiple LEs per country
Subset of Legal Entities serviced by different Payables BU
US GAAP Primary
Supplier Site Assignment
Procurement BU: Service BU 1
Requisition BU
Payables BU
Service BU2
Service BU3
Default LE
LE1
LE2
LE3
Default LE
Profit Center 2
Below LE: Y
Business Functions Materials Management*
Service BU 2
Business Functions
Payables
Requisitioning
Materials Management
Profit Center 1
Below LE: Y
Business Functions
Materials Management*
Profit Center 3
Below LE: Y
Business Functions Materials Management *
Service BU 3
Business Functions
Payables
Requisitioning
Materials Management
Inventory Org 1
Inventory Org 2
Inventory Org 3
Management BU
Management BU
Service Provider Relationship
Provider: Service BU1
Client BU: Service BU2
Service BU 1
Business Functions
Procurement
Service Provider Relationship
Provider: Service BU1
Client BU: Service BU3
*Profit Center Business units are BU that rolls up to one legal entity. Such business unit is the management owner of revenue and costs generated by the associated inventory organizations.
Generally there is a manager with P&L responsibility for such profit center. There are no additional setups involved in Payables or purchasing involving the profit center BU. These are light weight tracking entities. However,
these can be used to model inter or intra company supply chain flows using transfer pricing. They need ‘Materials Management’ function just to enable ‘Below LE’ flag on the definition. Enabling the flag sets it up as profit center.

5. Option 3B: Semi Centralized Procurement, Payables, Requisitioning, Materials Management (PC BU <> Management BU)
General Recommendation:
1 Ledger and 1 FIN BU, Multiple LEs per country
Subset of Legal Entities serviced by different Payables BU
Supplier Site Assignment
Procurement BU: Service BU 1
Requisition BU
Payables BU
Service BU2
Service BU3
US GAAP Primary
LE1
LE2
LE3
Default LE
Default LE
Profit Center 2
Below LE: Y
Business Functions Materials Management *
Profit Center 3
Below LE: Y
Business Functions Materials Management *
Service BU 2
Business Functions
Procurement
Payables
Requisitioning
Materials Management
Profit Center 1
Below LE: Y
Business Functions
Materials Management*
Service BU 3
Business Functions
Procurement
Payables
Requisitioning
Materials Management
Inventory Org 1
Inventory Org 2
Inventory Org 3
Management BU
Management BU
*Profit Center Business units are BU that rolls up to one legal entity. Such business unit is the management owner of revenue and costs generated by the associated inventory organizations.
Generally there is a manager with P&L responsibility for such profit center. There are no additional setups involved in Payables or purchasing involving the profit center BU. These are light weight tracking entities. However,
these can be used to model inter or intra company supply chain flows using transfer pricing. They need ‘Materials Management’ function just to enable ‘Below LE’ flag on the definition. Enabling the flag sets it up as profit center.

6. Option 3C: Semi Centralized Procurement, Payables, Requisitioning (Only Expense Destination Purchase, No Inventory Management)
General Recommendation:
1 Ledger and 1 FIN BU, Multiple LEs per country
Subset of Legal Entities serviced by different Payables BU
Supplier Site Assignment
Procurement BU: Service BU 2
Requisition BU
Payables BU
Service BU2
Service BU3
US GAAP Primary
Default LE
Default LE
LE1
LE2
LE3
Profit Center 2
Below LE: Y
Business Functions Materials Management
Profit Center 1
Below LE: Y
Business Functions
Materials Management
Profit Center 3
Below LE: Y
Business Functions Materials Management
Service BU 2
Business Functions
Procurement
Payables
Requisitioning
Materials Management
Service BU 3
Business Functions
Procurement
Payables
Requisitioning
Materials Management
Inventory Org 1
Inventory Org 2
Inventory Org 3
Management BU
Management BU

7. Option 3D: Semi Centralized Payables (Non-PO, Expense only invoices)
Subset of Legal Entities serviced by different Payables BU, but there is no hard grouping of LE to BU. It’s a manual process to ensure which BU processes invoices for which LE
General Recommendation:
1 Ledger and 1 FIN BU, Multiple LEs per country
US GAAP Primary
LE1
LE2
LE3
Default LE
Default LE
Profit Center 2
Below LE: Y
Business Functions Materials Management
Profit Center 3
Below LE: Y
Business Functions Materials Management
Service BU 2
Business Functions
Payables
Profit Center 1
Below LE: Y
Business Functions
Materials Management
Service BU 3
Business Functions
Payables
Inventory Org 1
Inventory Org 2
Inventory Org 3
Management BU
Management BU

8. Payables and Payments business functions
Within a Ledger
Payables BU can also perform Payment function for its invoices
Payables BU can let a central Payments BU to pay on-behalf of multiple legal entities.
Across Ledger
Centralized Payment is not supported