Payment Terms, changing cash discount percentage

[former_member182378]

Please advise on the following -

Payment Terms Z001 -

10% discount if paid within 5 days;

7% discount if paid within 20days (of posting date)

The sales order, SKTO picks up 10% automatically. This also goes to the billing document.

If the customer pays on the 15th day, then 10% has to be CHANGED to 7%, how and where and by whom is this done?

[former_member184555 · Accepted solution]

Hi

As you said the SKTO is a statistical condition and it will show the eligible cash discount on that date. The value will not change after few days, based on the terms defined in 'payment terms'. The terms of payment will be printed on the out put sent to customer. Based on the payments received, the FI will calculate the eligible cash discount value.

Thanks,

Ravi

[former_member182378 · Accepted solution]

Hi Ravi,

I am little confused. Ram said that the value shall be automatical change based on setting of OBB8 and system calculation. Are you saying that there shall be NO change irrespective of payment in 5 days or 10 days or 30 days?

How exactly shall accounting / FI do the necessary calculation? Please explain.

Thank you!

[jpfriends079 · Accepted solution]

Hello

Yes that is.

SKTO value in billing doc is indicative.

And this SKTO is any how not printed on invoice, whereas you get payment terms.

To make this materilised, your billing doc should be posted to accounts.

Thus, there will be no effect of payment terms in sales process.

These payment terms are meant for FInance.

Check your customer master GL by using TCode FBL5N.

There you will be able to see payment term indicator and its status. Overdue items will be marked in red with warning bell.

While taking payment in FI, this discount with trigger automatically in payment receipt transaction based on your payment terms.

Hope this assist you in understanding.

Regards

JP

[Former Member · Accepted solution]

Dear Mr.Typewriter

Request you to kindly explain the process here, in the example which you've mentioned. ( within 15 days in vf01 & what if the customer pays after 20 days?)

Rgds

Sumanth.G

[former_member182378 · Accepted solution]

Hi Sumnath.G,

J Prakash has explained / answered the question.

Payment Terms = Z001

10% -, payment within 5 days

7%-, payment within 20 days

In sales order and billing document, Tab Conditions, SKTO = 10% -

Customer pays after 15days - There is NO change in the sales order and the billing doc (SKTO stays 10%-)

The finance dept. in their transactions in the system, get the change 7%- automatically populated by the system from the Terms of payment and the date of payment by the customer.

Below post by J Prakash -

Hello

Yes that is.

SKTO value in billing doc is indicative.

And this SKTO is any how not printed on invoice, whereas you get payment terms.

To make this materilised, your billing doc should be posted to accounts.

Thus, there will be no effect of payment terms in sales process.

These payment terms are meant for FInance.

Check your customer master GL by using TCode FBL5N.

There you will be able to see payment term indicator and its status. Overdue items will be marked in red with warning bell.

While taking payment in FI, this discount with trigger automatically in payment receipt transaction based on your payment terms.

Hope this assist you in understanding.

Regards

JP

PS - did you read my post about Schedule line category CD? any comments?

[Former Member · Accepted solution]

Dear Mr.Typewriter

Yes, I understood that earlier. The question is, at what exact point, in "FI transaction" (??) is this updated? Also, I 've noticed that in std prc proc 'rvaa01", there is NO account key assigned to SKTO & SKTV.

Another point is,

Assume, we create the invoice (billing doct) & send it to customer, along the goods. Now, what about this 'cash discount' (SKTO or SKTV) in the invoice printout?

Is this shown or not? If yes, how can this be shown? when he has not made the payment itself)

Hope I am clear.

Rgds

Sumanth.G

[former_member182378 · Accepted solution]

Thanks for these questions!

at what exact point, in "FI transaction" (??) is this updated?

I don't know!

what about this 'cash discount' (SKTO or SKTV) in the invoice printout?
Is this shown or not? If yes, how can this be shown? 
when he has not made the payment itself)

If you read the earlier posts, the Terms of Payment are printed out on the print-out of billing doc. (and NOT SKTO)

Also mentioned was SKTO is purely for indicative purposes.

Important for me was to know -

- is there a change (i.e. 10% to 7% etc.): Yes there is

- is this change done in the billing document, VF03, Tab Condition, condition type SKTO: No

- is the accurate discount given to the customer and by whom: Yes by the staff from the finance department

[former_member275472 · Accepted solution]

I am responding to this query for all readers of this forum as the original question is still unanswered.

The statistical cash discount condition type in sales order or billing document does not change at any time during this process. It is only indicative. The change is at the time of payment document posting in FI.

So lets say an invoice of $100 has pay terms such that customer gets a cash discount of 10% if paid within the first 15 days.

The billing document posted to accounting will have a value of $100.

If the customer makes a payment within 15 days, then at the time of FI payment document posting, SAP calculates a discount of 10% and posts it to the customer account - so effectively the value of invoice on customer account becomes $90 and is cleared by the payment of $90. The $10 is posted to cash discount account.

I hope that answers the original question.

Regards,

Gautam

[Former Member]

system automatically calculate the date either from posting date,billing date or from entry date it will calculate and according to that gives the discount.

In SPRO - SD - Master data - Business partners - customers - billing documents - define terms of payment.

here we tell the system how to calculate the discount and all.

Thanks

Ram

[former_member182378]

Hi Ram,

thank you for your post!

Could you please explain the process?

I have configured my Payment Terms Z001, Posting date as my starting date

10% discount if paid within 5 days;

7% discount if paid within 20days (of posting date)

Invoice has 10% as SKTO with posting date = Today 20-09-2011. Customer pays 4-10-2011. What are the actions done and in the same invoice is the SKTO changed from 10% to 7% automatically?

[Former Member]

Hi,

I will explain your case clearly.Here you created new payment term as Z001 1) 10% discount if paid within 5 days;

2) 7% discount if paid within 20 days (of posting date).

posting date means invoice created and posted in accounts.in this scenario for Ex : 1) today (20.09.11)you have created invoice and posted to accounts,if the customer pays the amount on or before 24.09.11 he is eligible to get 10% discount on his billing value.2) from the date of 25.09.11 on words 14.10.11 he will comes under 7% discount.after 15.10.11 he has to pay to total amount means not eligible for discount, in this scenario system behaves like this.

hope you got clear.

Thanks

Ram

[former_member182378]

Ram,

I understand - after what dates, how much has to be paid by the customer. This is clear.

But my question is more how does this change in the invoice (9000####) in the system?

In VF01, invoice created, SKTO is 10%

after 5 days, if customer has NOT paid, SKTO must change to 7% (does user have to go to VF02 and do the necessary changes or is it automatic or....)

after 20 days, if customer has NOT paid, then SKTO must change to 0% (same question here too, about change in SKTO %)

How does this happen in the invoice?

If I go to the invoice in VF02, I am unable to change SKTO % (e.g. from 10 to 7 to 0). (manual changes are Disallowed)

Thank you, in advance!

Edited by: Typewriter on Sep 20, 2011 2:28 PM

Edited by: Typewriter on Sep 20, 2011 2:30 PM

[Former Member]

as per my knowledge system will consider the payment terms while the customer settling the amount (FI),that time system will take all these factors in to consideration according to that gives the discount. so no need to change it in VF02,once billing posted to accounts its done.

Thanks

Ram

[former_member182378]

When invoice is created in VF01, in Tab Conditions, SKTO is marked statistical.

In my understanding, this discount is NOT given to the customer.

When he pays within 5days, and he is entitled for 10% cash discount. Is SKTO changed from statistical to not statistical? How does this work?

Thank you, in advance!

[Former Member]

Dear Mr.Typewriter

I understood your requirement & concern.

One workaround, which I can suggest right now, is to include both the 2 conditions ( 10% & 7 %) within the SAME payment term.

Pls go through the controls of OBB8.

under "payment terms" tab,there are 2 columns. Pls observe. 'percentage" & 'no of days.'

So, within a SINGLE payment term, give 2 sets of entries here.

Hope you understood.

However, I know that this is NOT the exact solution.

Your concern is , "what if the 'no of days' exceeds much more than defined' or else if customer pays much much later?

Hope there is no ambiguity in my communication.

Rgds

Sumanth.G

[former_member182378]

Hi Sumanth.G,

As you commented the issue is not to have 2 or more "slabs" (10% within 5day, 8% within 20days etc.) in one Terms of Payment in OBB8. The issue is how shall 10% change to 8% etc.

Acutally if there is some one who has been working in the accounting department, for him/her this would be daily work.

Thank you for your post!

[Former Member]

This is because of routine assignment in Requirement (9) and in Alternative condition base value 11.

Regards,

SGR

[former_member182378]

Requirement 9 ensures that only if MMR is relevant for cash discount, then the condition type shall be accessed by the system, during pricing in the sales order.

Base Type 11 determines if the base value is net value or net value + tax.

Unfortunately, the above points are not related to my question.