what is value rated credit memo?

[Former Member]

Dear Gurus,

what is value rated credit memo?

Thanks in advance...

[former_member550050 · Accepted solution]

Hi

Value dated Credit memo

This is a vey useful control function in Billing Type.

Whenever yoyu create a Billing document, system automatically calculates the "Payment due date", taking the Payment term into consideration.

Suppose, you have billied a customer "C1" on 22/07/2009 (for example goods worth Rs. 3.00.000/-) who is eligible for one month credit period as per Payment term applicable to him.

That means, he is suppose to pay you on 22/08/2009.

To-day (26/07/2007), suppose customer has returned some goods due to certain complaint, say goods worth Rs. 50,000/-.

Now, when you will create a "Credit memo for Return" for the goods Return, then the Credit memo and posted to FI, it becomes due (payable) immediately.

That means you need to pay the customer Rs.50,000/- today (26/07/2009) even though he has not paid you till now (he will pay you on 22/08/2009).

That means if the due date of the original billing document is not taken into consideration, then this is how system will behave , means Credit memo becomes due immediately which is not logical.

Therefore, in order that system should take this due date of the original billing document into consideration for calculating the due date fo the Credit memo, we need to activate the "Value dated Credit memo" field in the concerned Billing type.

So the Credit memo becomes due on or after the payment due date of the original billing document.

Note Please dont award any points for this answer because this excellent explanation was given to me by one of SDN friend Mr.Pradamyuna to my maild id which i have Forwarded

The credit should go to Pradamyuna only

Regards

Raja