SAP Inter-Company Stock Transfer (STO) Process Flow

Prepared by Harshvrdhan Rathore

Moving stock between plants of two different company codes in the same group — the receiving company orders, the supplying company delivers and bills at a transfer price, and the receiving company verifies the invoice and pays. Solid boxes are the main flow (number = sequence); dashed boxes are setup, supporting or automatic SAP steps. Hover over a box to see details.

Different company codesPlant → PlantInter-company STO→ Delivery→ Goods issue→ Billing→ Goods receipt→ Invoice verification→ Payment

Main process step (number = order) Supporting / master data activity Document flow Input / support

Department-wise role

Step-by-step flow

#	Department	Activity	What happens	Output

Key inter-company STO concepts

Two legal companiesEach company keeps its own books: the supplying company sells, the receiving company buys. That is why billing, invoice verification and payment are needed.

Vendor and customer linkThe supplying plant is a vendor in the receiving company, and the receiving plant is a customer in the supplying company.

Transfer priceGoods move at an agreed inter-company price, kept as condition records. The supplying company books a margin; the receiving company values stock at this price.

Movement types643 — goods issue for cross-company transfer with delivery, 101 — goods receipt at the receiving plant, 645 — one-step cross-company transfer.

Automatic invoiceBilling in the supplying company can create the incoming invoice in the receiving company automatically, so both sides always match.

GST and consolidationA tax invoice and e-way bill are always needed. At group level, inter-company revenue, payables and receivables are eliminated in consolidation.

Note: some groups skip the delivery and use a one-step cross-company transfer; the flow above shows the standard two-step process with delivery and billing. Codes and settings vary by client configuration.