How to Set Credit limit for both Value and Days?

[Former Member]

Hi,

My client has following requirement.

For a particular customer, once the billing document is generated ( Accounting document is released ), if he doesn't pay within specified days ( say 10 days ), system should not allow to create next sales order for this customer, even if he has balance credit limit.

Is this process possible / If yes, what would be the steps.

Regards

Trupti

[Former Member · Accepted solution]

hi

you can achive this by using HIGH.DUNN.LEVEL in CHECKS area for credit control

but for this you need to take help of FI guys. they will set up Dunning process and this Dunning process is assgined to customer.

Dunning Process In Credit Management

1) You have a Customer which you had felt, he is doing good business and supplied material on Credit of 45 days.

2) Since this customer is good as you felt, you have not managed Credit Checks as well. So, he had comfortably reached to the fullest credit (or even more) which you can afford for any customer.

3) One fine day you got realised that, there is very bad debt with this customer and need to recover from him and till then, there will be no further supply to the customer.

4) Your company's legal department has laid a policy that, inorder to recover any bad debts, like:

a) We will send a normal payment reminder.

b) In case customer doesnt respond, we will send at least further reminder (dunning notice) may be 9 times

(9 reminders) (Dunning level) and what intervels of time (dunning frequency)

c) Still if the customer doesnt resopond for the reminders, you will file a law suit against the customer for recovering

the Payments.

d) Finally, after getting veridict, you may proceed for auction of his property or as per the order for Law.

Now in SAP, the definition of Dunning procedure is a pre-defined procedure specifying how customers or vendors are dunned.

For each procedure, the user defines

- Number of dunning levels

- Dunning frequency

- Amount limits

- Texts for the dunning notices

In SAP, you will maintain the Dunning Procedure at customer master. Referring to this your SD Team / FI Team (user team) will effect Dunning

to have more idea of Dunning process please check the link

http://134.198.33.115/sap/dunning.htm

Regards

Edited by: WISH on Oct 5, 2010 10:01 AM

[Former Member]

Closed.

Thanks & Regards

Trupti Deulkar

[Former Member]

Hi Trupti,

you can use the field "Days oldest item" or "NoDays openI" available in OVA8 in customization for this purpose.

Note: the number of days mentioned here will work in addition to the payment terms period.

Say the payment terms is 30 days & 10 days is ur days oldest item maintained in ur OVA8 customization, then 40 days will be the period considered for oldest items over due.

Thanks & Regards

Ilango

[Former Member]

Hi Ilango,

How the solution you suggested will work on following scenario:

Three customers has been created says B, C1 & C2 where B is Broker who sales goods to customer C1 & C2. Credit limit has been set for B. in FD32 for customer C1 & C2 credit account of B is assigned. That means that for any orders fr om customer C1 & C2 system will check the credit limit of Broker (B).

What will be effect if I maintain "Days oldest item" or "NoDays openI" in OVA8?

[Former Member]

Hi roopesh,

am not pretty sure about the scenario, am sorry abt it.

but with regard to "Days oldest item" or "NoDays openI" in OVA8?

days oldest item will blindly look for the outstanding from the customer & if he had exceeded the same (no. of days maintained in OVA8 + payment terms) , will put a block for his subsequent documents.

on the other hand, "NoDays openI" will work together with max %,

say if no, of days open item had crossed 50% then put a block. here you can have the number of days in different to the days oldest item, so that u r monitoring the customer well in advance.

rgds

ilango

[Former Member]

This has been achieved using "NoDays openI"

Thanks for all your inputs.

Regards

Trupti Deulkar