Why it matters for manufacturers
- A cost per unit that is wrong by a few cents changes margin on every product that uses the material.
- Surcharges for steel, fuel and currency are added late and may not be in the supplier agreement.
For manufacturers in S/4HANA
- Tolerance limits are set per variance type. Each has up to four limits, lower and upper, as an absolute value or a percentage. Use absolute limits for low value consumables and percentages for big raw material lines.
Rules that matter for manufacturers in S/4HANA
- Tolerance limits are set by an administrator in Customizing for Logistics Invoice Verification, not by AP users. Agree the limits with finance and purchasing.
- Each variance type has up to four limits. Use percentages for large raw material lines and absolute values for low value consumables.
- Set Do not check to stop a check. Set the upper limits to zero with Check limit to always block.
What S/4HANA does on its own
Price checking happens through the match tolerances. The system compares the invoiced price with the PO price and blocks the invoice for payment when the gap is outside the price variance limits. Agreed prices can be held on contracts or info records and flow into the PO.
Tolerances are set by an administrator, not by AP users.
What you need and the setup steps: Supplier price checks for S/4HANA.
Example
Example Alloy Supplies sells 8 tonne at an agreed $2,450 a tonne held on a contract. The invoice charges $2,610 a tonne. The administrator set price variance limits as a percentage for raw materials.
| Line | Amount | What the check finds |
|---|---|---|
| Contract price, 8 tonne at $2,450 | $19,600.00 | Flows into the PO from the contract |
| Invoice, 8 tonne at $2,610 | $20,880.00 | Outside the upper limit, so the invoice posts but is blocked for payment |
| Consumables invoice with an absolute limit | $85.00 | Small gap inside the absolute limit, so it passes |
The raw material invoice is blocked for payment until purchasing confirms the price. The consumables invoice is paid as normal.
Common mistakes for manufacturers in S/4HANA
- Setting one percentage for every material.
- Holding the agreed price nowhere, so the PO price is whatever was last typed.
- Reading a blocked invoice as an error. It posts and waits for release.
Step-by-step guides for S/4HANA
What Pulsify adds
Pulsify checks every line against the purchase order or a price list you upload for each supplier. Pulsify connects to S/4HANA. We set up the connection for you. More about supplier price checks in Pulsify or Pulsify for manufacturers.
More help
- Supplier price checks in SYSPRO for manufacturers
- Supplier price checks in Business Central for manufacturers
- Supplier price checks in Dynamics 365 Finance for manufacturers
- Invoice approvals in S/4HANA for manufacturers
- Multi-entity accounts payable in S/4HANA for manufacturers
- Duplicate invoice checks in S/4HANA for manufacturers
- PO matching in S/4HANA for manufacturers
- All S/4HANA how-to guides
Sources
Last checked 2026-10-19.
- help.sap.com/docs/SAP_S4HANA_ON-PREMISE/af9ef57f504840d2b81be8667206d485/8770b6531de6b64ce10000000a174cb4.html
- help.sap.com/docs/SAP_S4HANA_ON-PREMISE/af9ef57f504840d2b81be8667206d485/7870b6531de6b64ce10000000a174cb4.html
- learning.sap.com/courses/invoice-verification-in-sap-s-4hana/entering-delivery-costs-1
- www.ato.gov.au/businesses-and-organisations/gst-excise-and-indirect-taxes/gst/tax-invoices
Common questions
How do tolerances work for raw material prices in S/4HANA?
Tolerance limits are set per variance type, with up to four limits, lower and upper, as an absolute value or a percentage. Use absolute limits for low value consumables and percentages for large raw material lines.
How do manufacturers handle material price rises?
Compare invoice price to the purchase order price on every line. If the supplier agreed a rise, update the standard cost and the price list. If not, dispute the invoice before approval.
Can S/4HANA block an invoice that is dearer than the PO?
Yes. When the invoice price is outside the price variance limit, the invoice posts but is blocked for payment. Someone then releases it or has the supplier correct it.
Pulsify setup guides
Want this done for you?
Book a call to see how Pulsify handles supplier price checks in S/4HANA for manufacturers.