How the sales returns will effect after rebate settlement in sap

[Former Member]

Dear SD Experts,

I have a query that the Rebate settlement is done (Material Rebate) after that the sales returns has taken place and again in the credit memo the system is showing the rebate accruals.

Can any one please suggest me how the actual postings will takes place? what changes need to be done to reverse the rebate accrual already posted.

Thanks in advance.

Anjan kumar

[Former Member]

Hi Anjan

Is the accrual getting posted or the accrual already posted is getting reversed because of the returns flow? Secondly you are saying that the rebate is already settled. What is the agreement status of the rebate? I guess if it is D then the accruals would not have been reversed because whatever you have accrued in that rebate you would already have paid out or you would have reversed the accrual while settling the rebate.

Please check and get back.

Thanks

Indranil

[lakshmikanthc2]

Hi,

The routine 24 which is assigned in pricing procedure for rebate conditions is applicable for Billing document, credit / debit memo request, or a return. Pro forma invoices are excluded. that means standard functionality.

Any way you can try by using specific access sequence for rebate conditions which will help us in not applying rebates into credit memos.

Regards,

Lakshmikanth

[Former Member]

Hi..

In our rebate scenario these are entries...

Dr. Rebate Discount

Cr. Rebate Accrual

Dr. Rebate Accrual

Cr. Customer

For Sales Return only one entry is happening therefore there is a balance in the rebate accrual account.

Dr. Customer

Cr. Rebate Accrual

Is there anyway we can clear the balance in the rebate accrual account without passing a manual entry.

Thanks....

[Former Member]

Hi Imran

1. The first entry should ideally happen along with the invoice posting or when you run VBOF.

Dr. Rebate Discount

Cr. Rebate Accrual

This means that rebate accruals are happening. This means you are keeping a provision to pay. You are booking a liability in your books.

2. The second entry is when you pay out to the customer.

Dr. Rebate Accrual

Cr. Customer

This means you are reducing the customer balance by adjusting against the liability. Ideally this entry is passed when you do a partial settlement. If a final settlement is executed then the additional accruals if any in the account will get reversed.

3. While taking returns the entry that you say that is happening is

Dr. Customer

Cr. Rebate Accrual

This is also correct since he has returned the good, we ideally should not pass on the benefit to him. Additionally if this is happening that means the rebate is still active. When you finally settle the rebate if there is any balance in the rebate account it will get reversed. This means liability will be reversed in your books of accounts.

Thanks

Indranil

[Former Member]

Dear Indranil,

Thanks for the detailed response. Appreciate it.

Yes, points 1,2,3 all are happening correctly in our scenario.

The issue I was having was with balance in the rebate accrual account due to the Return Sales.

So far rebates are settled monthly and only end of the year we will make the final settlement.

So from what you have explained once we do the final settlement, the balance in the accrual account should get cleared.

What will be the accounting entry ?

Thanks.

[Former Member]

Hi Friends,

We have rebate issue where there is balance in the rebate accrual account at the end of the year and we want to clear it.

The root cause of the issue is because of Sales Returns, when we create return orders, the Customer Account is getting DR. and Rebate Accrual Account CR. again and that value remains and get accumulated in Rebate Accrual Account as a CR.

What is the normal process for Sales Returns with rebates and how can we clear Rebate Accrual Account rather than passing a manual FI entry?

Thanks

[Former Member]

Hi Sanjay,

Once the rebate settlement is completed then you got the returns from the customer then create a return order with reference to the Invoice and pls change the pricing date in the return order.

Because rebate value will be picked up i the invoice based on the validity periods in the agreement. Once the credit memo is settled that means agreement is closed.

If you change the date i think no rebate amount value will get accured because condition is not in the validity date.

Otherwise pls cancel the credit memo and change the billing date and try to create the credit memo and see rebate value is getting picked up in the CR.

As per my knowledge once if you paid the rebate on the full invoice and customer returns then you need to colledct the rebate amount from the customer. As per the business needs to create debit memo so that FI posting will not effected.

Regards,

SK

[Former Member]

Hi,

As per the configuration Rebate value is accured and posted to the financial accounting. These values you can check in the Invoices.

Rebate is linked to certain period so all the invoices and their rebate values will be accured in the Agreement. You can see the accured amount in the Agreement.

If the customer returns the material and created the credit memo its posting the values in the FI as a reverse entry. based on this entry automatically system will update the accurals amount, It will not add the value to the accurals amount. Infact it will deduct the amount from the accurals.

Enen though if you want toreverse the entry inthe accurals you can cancel the credit memo so that value will be reversed from accurals.

Customer rebate payment is depend on the customer invoice payments. Once the FI confirms that the customer cleares the invoice amount then only they can create credit memo through the agreement either Partial rebate credit memo or Final settlement credit memop.

Once this credit memo is cleared by finance then it will posted to the customer accounts.

I hope it will clear.

Kindly let me know if you need any clarifications.

Regards,

SK