Controls in SAP to detect discrepancies between customer PO and Billing

[Former Member]

Hello Gurus,

My name is Chandra Subramanya, SAP consultant for about 17 years now. I have been asked to assist in a situation that one of the companies is in right now w.r.t a controls in the sales to billing process. This is not really a technical question but more of picking your brain on the experience you had with other companies which run on SAP.

Background:

In order to achieve efficiency in the warehouse, we had to develop a highly complex solution in SAP ECC to combine like items from several POs into a single line on the delivery which resulted in several enhancements that also touched the billing. 6 months after we went live with the project, the customer created a billing dispute providing one of the invoices where the amount and quantity billed was higher than the PO (Sales Order). The question that we have from the executive management and the controllers is “how would we have found this invoicing error” on our own without the customer having to report to us. What kind of controls have you seen with other companies to avoid such discrepancies. If this happened in your experience with one of your clients, how were you able to detect it? Please bear in mind that we are talking about terabytes of data in terms of volumes everyday and the billing runs are huge.

ASK:

I want to make sure that my ask is very clear and precise. I am aware that we could create reports in ECC, BI etc etc from a technical perspective but I want to know what kind of controls have you seen that have been put in place at your clients places to detect these kind of discrepancies more from a SOX and business process perspective.

Thanks in advance!

Regards

Chandra

[Shiva_Ram · Accepted solution]

I would approach your issue in two ways;

1) Process improvement in the system: when you say billing contains quantity/value differs from sales orders/deliveries. -How to avoid this? You may need to check copy control settings/delivery item category settings/user-exits to verify delivery quantity matches sales order quantity(ies) and billing value matches sales order values (for example checking the pricing date and pulling the pricing date from respective sales order to billing through copy controls).

2) Controls: In my experience, certain companies uses reports (which you are already aware of), some companies uses workflows in sales orders (to verify quantity/pricing to match customer PO) and to approve, some companies uses delivery/billing/FI posting blocks to verify the data in sales order/invoice etc.

Hope this provides some input to your question.

Regards,

[Former Member · Accepted solution]

Thank you Shiva for taking the time to review this. Copy control is something that has not helped because, it is still in the background and things can go wrong even after that.

But I definitely like your idea of workflow at the billing document level which I am going to suggest for implementation as measure for control processes.

Thanks again!

Regards

Chandra

[Lakshmipathi]

customer created a billing dispute providing one of the invoices where the amount and quantity billed was higher than the PO (Sales Order).

This could happen only in case of manual pricing in billing or wrong coding in user exit.  With the standard functionality of copy controls, which has already been suggested, the most important field to derive a different price in billing than sale order is "Pricing Type" in VTFL where if you maintain other than "B", system will always consider sale order price irrespective of your condition record. This means, there is no chance of mismatch of pricing from sale order to billing.

Incidentally, I would like to ask you in how many cases, the reported issue has happened in 6 months as you stated?  I am sure, if the system is running only with standard configurations, there would be nil issue.   

G. Lakshmipathi

[Former Member]

Hi Lakshmipati,

Thanks for taking the time to review this. I would like to mention that, since we did not have a standard way to combine like line items from several PO's of the same store into a single line in the delivery, we had to customize and get a little away from the standard which is why we required to change the data transfer routine between delivery and billing. In such a case, as you are aware, we had to take into consideration every single scenario that happens in the warehouse and code for it in the routine and apparently we missed a batch split scenario where there is a line item split that resembles to how we combined quantities for our requirement.

Regards

Chandra

[moazzam_ali]

Hi

Though you have already got suitable suggestions and this discussion is closed but I found it interesting and want to share my thoughts on it.

First thing we need to see is that whether are we creating one sale order for one customer PO? What if customer gives us an order of product A and B in one PO because for customer these are one group of products but in our SAP we have separate divisions for these or due to any other factor we create two sale orders. In this case PO value and sale order value would never be same. Either we need to educate customer to give separate POs or we need to create separate sales orders but merge the invoice.

We had such requirement in our last project and we did some customization for this. We used additional field KNVV-KVGR1 in customer master sales area data for maintaining the invoice and delivery split criteria. For customers who strictly follow one invoice against one PO we select appropriate value in this field and added custom logic in copy control routine. With this system always creates deliveries and invoices as per customer's demand.

Regarding order value we didn't have terabytes data so we suggested to use posting block and users were ok with that. They manually check the order value and PO value for these customers.

What we can do to automate this is we can create additional field in sale order header tab with PO number field. We can add PO value as well and put logic in RV60AFZZ to validate this value with SAP calculated value. This will make sure no difference in customer PO value and SAP sale order/Invoice value.

Thank$

[Former Member]

Thank you Mozza M for your review and insights.

Regards

Chandra

[mathieu_chenot]

Hi,

I had to detect this kind of discrepancy in the third party prcocess (because quantity in SD invoice is quantity in MM invoice and something wrong unit conversion...).

To do this I used user status modified in copying rule during invoice creation (which were not created in case of discrepancy...) and also send an alert by email.

Then people could use standard report V.26 to unblock sales order.

[Former Member]

Thank you reviewing this Mathieu, appreciate it very much. I agree with you, setting CEPOK might be a simpler and more feasible solution.

Regards

Chandra