Billin Problem related with payment terms

[Former Member]

Hi all SAP experts,

The client is selling inventorized items (trading goods) as well as services. There are orders in which the client will enter the trading goods as well as a service item called as u201Cinstallation charges.u201D For the trading goods line item category say u201CTANu201D the billing relevance will be u201CA u2013 delivery related billing documentu201D as the invoice will be created after the delivery to close the sales cycle. For the rental contract item category & maintenance item category, the billing relevance will be u201CI u2013 order relevant billing-billing planu201D.

Say a sales order is created & in that along with the trading item (ATM machine), there is a service line item as well for installation charges. So there will be two different item categories in the same sales order.

The payment terms will be fetched from the customer master or may be changed in the sales order as per the negotiations with the customer.

The payment terms will be as follows & will be entered in the sales order:

1. 50% at the time of order confirmation (sales order).

2. 40% after the delivery.

3. 10% after the installation, commissioning & testing.

Requirements:

1. The client wants to generate a separate invoice for all the 3 part payments.

2. All the three invoices will have different payment terms. (for example, the sales order is created for 2000 USD. First invoice of 50% i.e. 1000 USD to be created & sent to the customer. Again the customer is supposed to send the payment within 7 days from the date of invoice. So there will be a separate payment term for the part payment to be received.)

3. The customer wants to have a report which will display for a sales order u2013 the amount received from the customer & the amount to be received from the customer.

Doubts:

1. In transaction code OBB8, we define the payment term & there is a tick for installment. If we tick this then we can create installments against this payment term.

2. In transaction code OBB9, we will see those payment terms only which have the installment indicator ticked. Again here we will specify the percentage of the installment & the payment term for the same. The installments are basically the same percentages to be received every period. Can this be used? If yes then does the system generate a separate invoice for the installment?

3. If I use the billing relevance u201CIu201D for trading item as well, then what about the delivery & invoice?

Please guide me on this issue.

With best regards,

Niyaz.

[Former Member]

hello, friend.

as to whether each material item can have separate payment terms if they are entered in the same sales order, the answer is 'yes'. one way to achieve this is to maintain different divisions for each of the 3 material items you are going to enter.

the customer master should then be created in 3 sales areas so that the sold-to party can have different terms for each division.

however, your requirement seems more like a billing plan rather than strictly payment terms. if billing plan fits your requirement, you might have to set up your cycle with order-related billing. also, i will have to check if billing plan is only at header level or if this can apply per item.

regards.

[Former Member]

Hi Jonathan,

Thanks for your reply. I had some doubts on the solution. Actually to be more precise let me explain you once again:

In the sales order i have the following line items:

1. ATM machine - 1 qty. This will be a stock item & the item category will be TAN which has billing relevance as "A" - delivery related billing.

2. ATM installation - 1 qty. This will be a service item so non-stock item & the item category will be TAX which has billing relevance as "A" - delivery related billing.

3. Cables - 500 Mts. This will be a stock item & the category will be TAN which has billing relevance as "A" - delivery related billing.

4. Cables Installation - 1 qty. This will be a service item so non-stock item & the item category will be TAX which has billing relevance as "A" - delivery related billing.

Like this there can be many other items as well. The installation items will be different as the client wants it to be.

Now suppose the total order value is 1000 USD. Now the client wants to create 3 different invoices. The payment scenario will be

1. 50% after order confirmation. Once the sales order is confirmed, then an invoice should be generated from the system with a value of 500 USD. For this particular invoice the payment term will be "within net 7 days".

2. 40% after the delivery has been done. An invoice to be generated from the system with a value of 400 USD. For this particular invoice the payment term will be "within net 15 days".

3. 10% after installation. commissioning & testing. An invoice to be generated from the system with a value of 100 USD. For this particular invoice the payment term will be "within net 7 days".

How should i configure the system in order to map the above requirement. Like i should be able to generate 3 different invoices from the system.

Also i want to know at any stage for a particular sales order what id the amount received from the customer & the pending amount.

Overall the sales cycle should be complete.......the document flow should show the

order: completed

delivery: completed

material document: completed

invoice: completed

accounting document: not cleared.

I have one more doubt, if for a stock item i create order related billing (i use billing relevance as "C"), then what will be the overall impact. Like i create the sales order, then delivery with PGI......will it be different from my normal delivery related billing cycle...?

With best regards,

Niyaz.

[Former Member]

hello, niyaz.

i was able to test your requirements on 11 oct 2008. here were my findings:

1. your requirement for 50%, 40% and 10% payments can be satisfied by using BILLING PLAN and selecting MILESTONE BILLING, which you must activate on sales doc header and item levels. you can specify that the first payment is a down-payment (which is not included in the 100% collectible, and you must settle the downpayment... more on this later).

the 40% after delivery is also confirmed in the sales order (billing by default will be order related as SAP standard). the 10% will follow the same logic.

in billing plan, you can manually or automatically specify the proportion of the installments. you confirm each payment by removing the block. then you can invoice each installment.

2. you can use different payment terms for each of the payments (50%, 40% and 10%). but these will be at header level, as the payment terms at item level are not modifiable (unless someone can find out how). i tried deactivating 'business item' at VOV7 but you cannot do this if you are using billing plans.

3. your client's remaining requirements can be tracked by the document flow at header level, and by using the reports in FI and Credit Management.

hope these helped you.

regards.

Edited by: jonathan yap on Oct 11, 2008 12:51 PM