Intercompany Billing - the scenario

[Former Member]

Hi Gurus,

What are the different situations and scenarios which lead to intercompany billing in real time...

1. does shortage of a particular product - which incidentally also exists in supplying plant of another company code; -- lead to this scenario?

or

2. can a complete absence of a particular product can lead to this scenario of getting a particular product from another company which is not produced by ordering company?

please explain to me as I want to understand the logic behind extending the material of the supplying company to the ordering company, to show as if the material also exists in ordering company code...

Thanks in Advance,

Nazim.

[Former Member · Accepted solution]

Basically you have two scenarios which lead to intercompany billing (invoice type IV).

1. Intercompany stock transfer (IC-STO).

- Goods are purchased from another plant under another company code. There's a PO, DN, PGI, IC invoice (supplying plant to purchasing plant), stock in transit, MIGO and a MIRO involved.

2. Cross-company sales

- Goods are supplied in IC sales process from another plant under another company code. There's a sales order with IC pricing procedure, DN, PGI, IC invoice (supplying plant to selling organization) and another invoice which is the final customer invoice involved.

[Former Member · Accepted solution]

Hi,

I don't think you have understood my question....I asked "what makes a company buy a particular material from another company...is it like the company had a similar material and the material is out of stock

or

is it that intercompany....is done when the material wanted by the customer does not exist in our company at all?

I asked this question as I'm surprised as to why we should extend a material of some other company to make it exist in our company when we do intercompany billing?

Thanks in Advance,

Nazim.

[Former Member · Accepted solution]

Right. Well, one scenario definitely is material shortage for production. Another scenario is when the customer has done business with a certain company and they want to get the invoice from this company. In this case, if the company doesn't have this material in stock, intercompany process can be applied.

[Former Member · Accepted solution]

Further, which I did not mention in the previous; if you use cross-company sales process, yes, the material needs to exist in both plants. The minimum in selling organization is basic data, sales views and accounting view.

[Former Member · Accepted solution]

Dear Nazim,

Scenerios, for Inter-Company Billing:

is it like the company had a similar material and the material is out of stock

and

is it that intercompany....is done when the material wanted by the customer does not exist in our company at all?

Definitely, YES.

Company A is selling own goods, but also goods from other companies. These materials are stored in plants linked to other company codes.

So an order can contain both materials belonging to company A as materials belonging to company B, reside in one logical system in the same client.

Normal sales works fine, because after the invoice is created, the system also creates an Intercompany Invoice (IV).

Best Regards,

Amit

Note: When dealing with different company codes, one may find a need to transfer stock between two different company codes. In case the stock is transferred between different company codes, a transfer of value occurs and is an intercompany sale (customer belongs to one company, stock in the plant to another).

Intercompany Transactions between two different SAP systems

Setup Idocs (you might use XI or other middleware) to handle the communication to load the IC transactions to the other system and vice-versa.

[Former Member · Accepted solution]

Dear Amit,

Thank you so much,

It was a very clear answer. I would like to clarify with you if I have any doubts in future. Is that ok with you?

Thanks,

Nazim.

[Former Member · Accepted solution]

Dear Nazim,

Thanks for appreciation.

Please don't mind, but as I am busy with my Offical-assignments, I get very little time to come online (SDN). However, whenever, I'll be able to assist, definitely, I'll try with my level-best.

Best Regards,

Amit.

Note: This forum has a lots of capable contributors, who are always ready to provide their valuable suggestions, in a fair manner.

[Lakshmipathi]

Dear Mohamed

A transaction between two company codes belonging to one organization is called Intercompany Business Process. The need to do such transactions would be due to

- Order received by one company code may not produce that material which the other company code produces

- some Government incentives to specific plants like EOU / SEZ etc., where it is not applicable for the other plant

Because the two companies balance their accounts independently, the delivering company must bill the ordering company for the goods. This internal billing transaction is carried out by means of an intercompany billing document. The delivering company bills the ordering company at a price that allows the delivering company to cover its costs.

thanks

G. Lakshmipathi