INTERCOMPANY BILLING & Contract

[Former Member]

Dear guru

what is mean intercompany billing & Contract? and give me the steps to config. in sd module.

regards

Mohammedrenu

mohammedrenu@yahoo.co.in

[Former Member · Accepted solution]

INTER COMPANY BILLING

Definition:

A company arranges direct delivery of the goods to the customer from the stocks of another company belonging to the same corporate group.

To put in simple terms, Company code A orders goods through its sales organization A from Plant B belonging to Company code B.

It is imperative that both Plants A & B should have the material. In other words, the material is created for both the Plants A & B + their respective storage locations.

Sales Organizations and Plants are uniquely assigned to Company codes. It is not possible to assign either a plant or a sales organization to more than one company code.

Sales organizations and plants assigned to each other need not belong to the same company code.

In other terms, a plant belonging to Company code A & assigned to Sales Organization A can also be assigned to Sales Organization B of Company Code B. This enables cross company sales.

PARTIES INVOLVED

1) End Customer 2) Ordering Company code 3) Supplying Company Code.

End customer:

Customer who orders goods from the ordering company code.

Ordering Company Code:

Which orders goods from Plant belonging to Supplying Company code through its sales organization and bills the end customer.

Supplying Company Code:

Supplies goods from its plant to the end customer specified by the ordering company code and bill the ordering company code.

CONFIGURATION SETTINGS

Assign Delivery Plant of the supplying company code to Sales Org + Distribution channel of the Ordering company code in the Enterprise Structure.

DEFINE ORDER TYPES FOR INTERCOMPNY BILLING:

Menu path: IMG/ SD/Billing/Intercompany Billing/Define Order Types for Intercompany billing

Assign Organizational units by Plant:

Menu Path: IMG/ SD/Billing/Intercompany Billing/Assign Organizational units by Plant.

Define Internal Customer Number By Sales Organization:

Menu Path: IMG/ SD / Billing/ Intercompany Billing/ Define Internal Customer Number By Sales Organization:

Creating / Showing Ordering Sales Organization as Internal Customer for Supplying Company code:

Transaction Code: XD01

The ordering sales organization is represented as Internal customer of Supplying company code.

We need to create customer master in Account Group - Sold to Party and maintain minimum required financial & Sales Area data.

This internal customer number has to be assigned to the ordering sales organization. Hence, the system automatically picks up this Internal customer number whenever there is Intercompany billing.

PRICING:

We need to maintain two pricing procedures RVAA01 & ICAA01. Pricing procedure RVAA01 represents condition type PR00 & any other discounts or surcharges that are meant for end customer.

We assign Pricing procedure RVAA01 to combination of Sales area (Of Ordering company code) + Customer Pricing Procedure + Document Pricing Procedure of Sales document type.

This pricing Procedure (RVAA01) is determined both at Sales Order level & Billing processing for the end customer.We maintain PR00 condition type to represent the ordering company code's price to the end customer.

Condition records for PR00 are maintained using organizational elements of Ordering company code, end customer & the Material.

Eg: Sales Org. of Ordering company code + End customer + Material.

We also need to maintain PI01 condition type to represent costs to Ordering company code (in other words revenue to supplying company code). It is statistical condition type & meant for information purpose only.

Condition records for PI01 are created with the following key combination:

Ordering sales Org + Supplying Plant + Material

Pricing Procedure ICAA01is determined at Intercompany billing processing level.

Pricing Procedure ICAA01 - Pricing Procedure for Inter company billing is assigned to the combination of:Sales Area (of supplying company code) + Document pricing Procedure of Billing document type IV + Customer Pricing Procedure of the Internal customer.

Pricing Procedure ICAA01 has condition type IV01 that represents revenues for Supplying company code in the intercompany billing.

PR00 condition type also appears in Intercompany billing document. It is for information purposes only and does not have bearing on the value of the document.

PI01 represented under pricing procedure RVAA01 is reference condition type for IV01 and the same is defined in the condition type IV01. Due to this these two condition types represent same value.

The condition type IV01 in intercompany billing document represents revenue to the Supplying Company. But its corresponding condition type PI01 in the billing document to the end customer is shown as a statistical item meant for information purposes.

Condition Type VPRS in the intercompany-billing document indicates cost to the supplying company code.

The use of two different condition types in Intercompany billing is necessary to ensure that data is transmitted correctly to the financial statement (Component CO-PA).

ILLUSTRATION:

STEP 1: Create Sales Order

Manually Enter the Delivery Plant of the Supplying Company Code:

OBSERVE CONDITIONS SCREEN FOR ITEM:

PR00 represents Price to the end customer (in other words, revenue for the ordering company).

PI01 represents cost to ordering company (in other words, revenue for the supplying company). It is represented as statistical item only.

DELIVERY:

Delivery is carried out from the supplying point & hence we can observe that it is done from shipping point assigned to the supplying point.

Subsequently, Picking & PGI are carried out.

BILLING TO END CUSTOMER:

T-Code: VF01

Create Intercompany Billing:

T-code: VF01

OBSERVE THE CONDITIONS SCREEN OF THE INTERNAL INVOICE:

IV01 Condition type represents revenue for the supplying company code.

VPRS condition type represents cost to the supplying company code.

PR00 in intercompany billing document displays amount billed to the end customer. It serves as just an information item and is inactive.

If the ordering company enters the incoming invoice manually, the delivering company can print out an invoice document with the help of output type RD00, which is then sent to the Payer.

If automatic invoice receipt has been agreed, we must use the SD output control functions to ensure that output type RD04 is found in internal billing. In R/3 system, output determination procedure V40000, which includes this output type, is assigned to Intercompany billing type IV.

The automatic posting to the vendor account is initiated when output type RD04 is processed. The system uses the EDI output type INVOIC in the FI variant.

To ensure that payables are posted in financial accounts of the ordering company, the delivery company must be created as a vendor.

<b>Contracts</b>

Follow the links

http://help.sap.com/saphelp_47x200/helpdata/en/06/57683801b5c412e10000009b38f842/frameset.htm

Master Contract:

The master contract is a document under which you can group contracts as lower level contracts. It contains the general terms which apply for all the lower level contracts over a specified period.

Use

You group contracts as lower level contracts under a master contract to ensure that

The terms in the master contract are granted in all the lower level contracts

The data in all lower level contracts remains consistent

You can group the following documents under a master contract:

Quantity contracts

Value contracts

Service contracts

The link between the master and lower level contracts is controlled by the referencing procedure which is assigned to the master contract type in Customizing. The referencing procedure determines which data is copied from the master contract into the lower level contracts

Structure

A master contract contains header data only. In the master contract, you can record:

Business data

Partner data

Contract data

Billing plan data

On the overview screen of the master contract, there is a list of all the lower level contracts which refer to it. You can branch from this list into the individual contracts.

--

Master Contract: The master contract is a document under which you can group contracts as lower level contracts. It contains the general terms which apply for all the lower level contracts over a specified period.

Check these links on Master Contract

http://help.sap.com/saphelp_47x200/helpdata/en/dd/55fd0d545a11d1a7020000e829fd11/frameset.htm

http://help.sap.com/saphelp_47x200/helpdata/en/dd/55fd34545a11d1a7020000e829fd11/content.htm

http://help.sap.com/saphelp_47x200/helpdata/en/dd/55fd27545a11d1a7020000e829fd11/content.htm

Details about contracts:

Lets take standard CQ contract type:

First maintain customer - material info record in VD51 T-code

Secondly maintain pricing for customer / material or only material combination in VK31 / VK11 T-code

Then use VA41 T-code to create a contract

VA42 to change contract

VA43 to display / view contract

In VA41, enter the document type CQ, followed by the sales area details,

Enter Sold to party.

Enter PO number

Enter PO Date

Enter Validitiy from Date

Enter Validity to Date

Enter Material

Enter Quantity say 999,999,999 or any other higher quantity as it is referred again and again

Hit Enter.

Save.

For further info refer below

Reward if Helpful...

Regards,

Praveen Kumar D

[Former Member · Accepted solution]

Hi Praveen,

I was going through your explanations for Intercompany Billing. I am facing some problem. I am not able to create the Intercompany Invoice. The Error is: "0080015018 000000 Sales organization is not defined". I have given the details of my settings below:

The following is my set up.

Ordering Company: Co.Code – MCA, Plant –PJF1, Sales Area—SOMT/CD/MT

Customer (External—100138), Material--1368

Delivering Company: Co.Code – Yash, Plant –Yash, Sales Area—3100/90/91

Customer (Internal ---10046), Material –1368

Step-1

Assigned delivering Plant YASH to the ordering Sales Org./Dist.Channel (SOMT/CD)

Step-2

Defined Order type for Intercompany Billing (i.e. Order type ZOR5 of Ordering Co. to IV)

Step-3

“Assign Organizational Units By Plant”

Here, I have assigned Delivering Plant to Delivering sales Area (i.e. YASH to 3100/90/91).

I am confused a bit here as somebody explained that

“First thing, "Assign Organizational Units by Plants" is used to assign Delivering Sales area to the plant and not the Ordering sales area. Various ordering sales area might order from the same plant but the delivery sales area for the plant would be the same.” I followed this.

Some has told with example:

“SPRO Customization required:-

1. Assign plant of delivering company code (Eg.SI81) to sales org/distribution channel combination of ordering company code (Eg.4211/RT)

2. Maintain intercom any billing type as IV for sales document type OR

3. Assign Organizational Units By Plant (Eg.SI81/4211/RT/11)

4.Define Internal Customer Number By Sales Organization (Eg.4436 will create customer master for 4211 company code and that number will be maintained in this relationship:-4211/231)”

In this case for serial number 3. the “S181” is the delivering Plant and “4211/RT/11” is the Ordering Sales Area.

Step-4

“Define Internal Customer Number By Sales Organization”

The customer which has been created in delivering Sales Area (i.e. 10046) has been assigned to the ordering Sales Org. “SOMT”.

Step-5

Maintained the Pricing Procedure for the Ordering Sale Organization i.e. Ordering Sales Area + Doc.Pr.procedure + Customer (External) Pr.Procedure = ZRVAA5

This ZRVAA5 contains the Cond.Type “ZPR5” and “PI01”.

Step-6

Maintained the Pricing Procedure for the Delivering Sale Organization i.e. Delivering Sales Area + Doc.Pr.procedure of IV (i.e. I) + Customer (Internal i.e. 100146) Pr.Procedure = ZCAA01

This ZCAA01 contains the Cond.Type “IV01” and “ZPR5”.

Step-7

In VK11 the price has been kept for cond type of “ZPR5” as SOMT/CD/100138 (Ordering Co. details) for the material “1368”. The price is $60.

Step-8

Again in VK11 the price has been kept for cond type of “PI01” as SOMT (Ordering Sales Org.) + YASH (Delivering Plant) + 1368 (Material). The price is $40.

Step-9

Created Sales Order, Delivery and did the Billing for the External Customer successfully.

But I am unable to create the Intercompany Invoice.

Please help me in solving this problem.

Regards,

Jans

[Former Member · Accepted solution]

Hi Praveen,

If possible please send some suggestion in my mail ID. My mail ID is jnsarkar@hotmail.com. I have already posted my problem in details in addressing you.

Could you guide me how to Reward in the Forum?

Regards,

Jans

[Former Member]

Thanks Narendan, adrash raj & lakshmipati for helping me

regards

Mohammed Renu

[Former Member]

Hi Mohammed renu

Step: 1

DEFINE ORDER TYPES FOR INTERCOMPANY BILLING

Path: IMG -- SD-Billing -- Intercompany Billing -- Define Order Types for Intercompany Billing.

Step: 2

ASSIGN ORGANISATIONAL UNIT BY PLANT

Path: IMG – SD --Billing -- Intercompany Billing -- Assign Organizational unit by Plant

Here Assign sales org-dist channel-division to Del1 which is sister concern co. plant

Step: 3

EXTEND CUSTOMER

Extend a customer of us05 sales organization i.e. eg.7000006001 to dell sales org. in customer master data. This is the customer who is actually ordering for the material.

Step: 4

ASSIGNMENT OF SALES ORG - DISTRIBUTION CHANNEL -PLANT

Path: IMG -- Enterprise Structure – Assignment -- SD

Step: 5

Create Customer and assign customer number to Dell Sales Org ie e.g. 100358 (payer) This customer is nothing but the corporate office. We assign a customer no. to the corporate office. This corporate office will be assigned as an internal customer.

T-code: Xd01

Step: 6

DEFINE INTERNAL CUSTOMER NUMBER BY SALES ORG

Path: Img – SD --Billing-intercompany billing -- Define internal customer number by sales org

Step: 6

MAINTAIN CONDITION RECORD T .C

T-code: VK11 -- PI01

Here we maintain the price for intercompany that is for the corporate office.

Step: 6A

T-code: VK11—PR00

Maintain a condition record for material sales org-US05 and dc- U4.

This PR00 is for the customer who is actually ordering the Material.

Step: 7

Create Sales Order

T-code: VA01

Then create Delivery and Billing

Mail send to ur id

Reward if useful to u

[Former Member]

Hi Mohammedrenu

INTERCOMPANY BILLING PROCESS

Intercompany Billing:

Go through the explanation given below with test cases.

Business case: -

Customer orders goods to company code/Sales organization A (Eg.4211/4211).Sales org 4211 will accept and punch the order in the system with sold to party as end customer code in the system. Company code/sales org B (Eg.4436) will deliver the goods to end customer and raise an intercom any billing on 4211 with reference to delivery. This can happen only after 4211 raises invoice to his end customer to whom the material has been delivered by 4436.

SPRO Customization required:-

1. Assign plant of delivering company code (Eg.SI81) to sales org/distribution channel combination of ordering company code (Eg.4211/RT)

2. Maintain intercom any billing type as IV for sales document type OR

3. Assign Organizational Units By Plant (Eg.SI81/4211/RT/11)

4.Define Internal Customer Number By Sales Organization (Eg.4436 will create customer master for 4211 company code and that number will be maintained in this relationship:-4211/231)

5. Automatic posting to vendor account (Optional)

6. Maintain pricing procedure determination for 4211/RT/A/1/RVAA01-For customer sales and billing

Maintain pricing procedure determination for 4436/RT/A/1/ICAA01-For intercompony billing

Master data to be maintained:-

1. Create end customer master in company code/sales org 4211/RT/11

2. Create customer master for 4211 company code/sales org in 4436/RT/11

3. Maintain PR00 as price for end customer-Active in RVAA01

4. Maintain PI01 as price which has to be paid to 4436-Statistical in RVAA01

5. Maintain IV01 as inter-company Price-Active in ICAA01

Process:-

1. Create OR with sold to party as end customer.

2. Plant to be selected is delivering plant belonging to different company code. With this selection system will treat this order as intercomany sales.

3. Pricing procedure is RVAA01

4. With reference to this order delivery will be created from the delivering plant and post the goods issue for this delivery.

5. Ordering sales org will create billing document F2 with reference to delivery for end customer.

6. Delivering sales org will create intercompany billing IV with reference to delivery document.

Following link

http://help.sap.com/saphelp_46c/helpdata/en/e6/4a6dc89e0311d189b70000e829fbbd/frameset.htm then go to special business transaction n click on intercompany sales processing.

http://help.sap.com/saphelp_47x200/helpdata/en/4d/2b911d43ad11d189410000e829fbbd/content.htm

http://help.sap.com/saphelp_47x200/helpdata/en/4d/2b917843ad11d189410000e829fbbd/content.htm

CONTRACTS IN SD:

Pl go through below link:

http://help.sap.com/saphelp_47x200/helpdata/en/06/57683801b5c412e10000009b38f842/frameset.htm

Master Contract:

The master contract is a document under which you can group contracts as lower level contracts. It contains the general terms which apply for all the lower level contracts over a specified period.

Use

You group contracts as lower level contracts under a master contract to ensure that

The terms in the master contract are granted in all the lower level contracts

The data in all lower level contracts remains consistent

You can group the following documents under a master contract:

Quantity contracts

Value contracts

Service contracts

The link between the master and lower level contracts is controlled by the referencing procedure which is assigned to the master contract type in Customizing. The referencing procedure determines which data is copied from the master contract into the lower level contracts

Structure

A master contract contains header data only. In the master contract, you can record:

Business data

Partner data

Contract data

Billing plan data

On the overview screen of the master contract, there is a list of all the lower level contracts which refer to it. You can branch from this list into the individual contracts.

--

Master Contract: The master contract is a document under which you can group contracts as lower level contracts. It contains the general terms which apply for all the lower level contracts over a specified period.

Check these links on Master Contract

http://help.sap.com/saphelp_47x200/helpdata/en/dd/55fd0d545a11d1a7020000e829fd11/frameset.htm

http://help.sap.com/saphelp_47x200/helpdata/en/dd/55fd34545a11d1a7020000e829fd11/content.htm

http://help.sap.com/saphelp_47x200/helpdata/en/dd/55fd27545a11d1a7020000e829fd11/content.htm

Contract

In the MM Purchasing component, a contract is a type of outline purchase agreement against which release orders (releases) can be issued for agreed materials or services as and when required during a certain overall time-frame. (In the literature and in practice, similar concepts may also be referred to by a number of other terms, such as "systems contract", "blanket order agreement", "blanket contract", and "period contract".)

The contract consists of items defining the individual materials, material groups, or services with prices and in many cases quantities.

An item is assigned to an item category, which defines the type of procurement (e.g. item category K for consignment, or L for subcontracting).

An item of the procurement type "external service" contains a set of service specifications. Such specifications may be hierarchically structured. The summary view of such a hierarchical structure is termed an "outline", and the individual levels of the hierarchy are referred to as "outline levels". Quantities are specified in service lines. Services can be released (ordered, or called off against the contract) at item level or at the level of the service line.

Costs can be apportioned among various Controlling objects via the account assignment.

Release orders issued against the contract (see below) are logged in the release documentation.

Contracts can take the following forms:

Quantity contracts

Use this type of contract if the total quantity to be ordered during the validity period of the contract is known in advance. The contract is regarded as fulfilled when release orders totaling a given quantity have been issued.

Value contracts

Use this type of contract if the total value of all release orders issued against the contract is not to exceed a certain predefined value. The contract is regarded as fulfilled when release orders totaling a given value have been issued.

You can also set up corporate buying contracts with your vendors. These are valid for all plants and company codes within a client (see Centrally Agreed Contract).

Over the contract validity period, certain quantities of the materials or services covered are released (called off) against the contract as and when required through the issue of purchase orders referencing the latter. Such purchase orders are thus termed "contract release orders" or simply "release orders". (Outside SAP, particularly in the UK; they may also be referred to as "call-off orders".)

Please Reward If Really Helpful,

Thanks and Regards,

Sateesh.Kandula

[Former Member]

Hi Sateesh,

I have posted my problem for Intercomapny Billing. Please help me in solving my problem. I am not able to create the Intercompany invoice though I have created the customer invoice including account determination. If possible please send some guide line in my mail id. My Mail ID is jnsarkar@hotmail.com.

Regards,

Jans

[Lakshmipathi]

Hi Mohammed

Go through the following link

http://help.sap.com/saphelp_46c/helpdata/en/4d/2b917843ad11d189410000e829fbbd/frameset.htm

Thanks

G. Lakshmipathi