Bill Discounting - Accounts Payable ( Implement Payment Orders or BOE)
We have the below scenario I'm trying to figure out which is the best approach .,
- Company Code 1000, purchases from vendor ABC goods worth $10000 on Jan 1st, 2016 and due date is Jan 31st.
- Company Code 1000 creates vendor Invoice on Jan 1st , 2016 for $10000.
- Vendor wants immediate payment , hence C.Code 1000 makes an agreement with say CITI Bank to make always an immediate payment for this vendor
- Company Code 1000 sends vendor invoice extract to CITI Bank and CITI Bank makes payment to this Vendor on Jan 2nd, 2016
- Vendor ABC should still show open items , since C.Code 1000 has not made actual payment.
- Based on due date Company code ABC sends payment extract to CITI Bank, wherein CITI Bank debits Comp Code ABC account for $10000
- Vendor ABC account is cleared.
May I know which is appropriate solution for the above scenario
I was thinking of either Payment Orders or Bills of Exhange (BOE)
A1.F110 can be generated and DME file showing the list of open invoices can be transmitted to CITi Bank
A2.Based on DME Invoice extract file CITI Bank makes payment to Vendor.
A3.On Due date how will company send payment extract file to CITI Bank ? is there a standard solution to support this step
A4. Clear the Vendor Open items using EBS ( Aligorthm 029)
My concern is if we implement PAYMENT ORDERS, how will we address step A3.
B. Bills of Exchange ( BOE)
Let me know your thoughts about BOE solution.
Your valuable inputs are highly appreciated and awarded accordingly.