Letter Of Credit Implementations

Hi gurus,
If it is possible can you explain me where ı can manage general letter of credit implementations at SAP;including the relationships with the banks regarding to the letter of credits and the links between foreign trade (swifts,correspondings,import etc.)
Thanks in advance.
Best regards.

Link below may be of use to you.
https://www.sdn.sap.com/irj/sdn/wiki?path=/display/profile/letterofCredit

Similar Messages

Revolving Letter of Credit - SD.

Hi Friends,
we have a requirement to implement Revolving Letter of Credit, where if a Payment is made for the particular customer it's value should be added to the existing open LC value .
we tested everything with Static LC and every thing is working fine. but now we have to implement revolving LC
Example.
LC duration is 1 JAN to 31 JAN
Initial LC Value = Rs. 1000
order raised = Rs. 800
LC Open value = Rs . 200
so if the customer makes payment for Rs. 300
the open LC value should be Rs. 200(Earlier open LC value) + 300(payment) = Rs. 500
Thanks & Regards
Harsha

Hi,
Kindly consider that when defining the indicators for special G/L transactions, you should define in each case whether the transaction in question is relevant for the credit limit check.
Best regards.

Letter of credit functionality for imports

Hi Experts
W.r.t FT, the financial document can be used as LC.
1) Is it possible to use this LC (Financial doc- Transaction VX11N) for linking the import purchase order?
2) Is there any standard functionality to monitor the import purchase orders which involve Letter of credit?
3) Is there any userexit to enhance the existing VX11N to make use for import purchase order?
warm regards
marias

Hello Marias,
I regret to inform you that the functionality you request is not
implemented in the standard system within the Foriegn trade area.
" The documentary payment functionality (Letter of Credit) for vendors
is not available in SAP Standard System.
Documentary payments can only be created on the SD side for customer
but not for vendors.
At this time, there is no plan to develop this functionality. "
Please note that the Foriegn Trade functionality has been expanded and
is available in the solution product "Global Trade Services" (GTS).
As you are probably already aware information on GTS is available in SAP
Service Marketplace.
Regards,
Alex

Letter of Credit charges

Dear colleagues:
We are about to implement the u201CRisk Management u2013 Letter of Credit Processingu201D functionality (from the importeru2019s view). As an importer we need to assign some other charges to the LC (e.g. custom expenses), with various due dates. These expenses should update cash management. I suppose this connection between LC and other expenses must occur in the purchase order. If yes, please inform me how we implement it. If no, please inform me with the correct solution. We use version ECC 6.0
Thank you in advance.

Hi,
I beleive that, the Letter of Credit Processing is out of SAP Scope as of now.
All LC Charges you have to post manually or Z Object / Customiged Object to be developed for tracking the LC Expences and those values to be used for manual FI JV.
Regards
VG

Letter of Credit Additional Charges

Dear colleagues:
We are about to implement the u201CRisk Management u2013 Letter of Credit Processingu201D functionality (from the importeru2019s view). As an importer we need to assign some other charges to the LC (e.g. custom expenses), with various due dates. These expenses should update cash management. I suppose this connection between LC and other expenses must occur in the purchase order. If yes, please inform me how we implement it. If no, please inform me with the correct solution. We use version ECC 6.0.
Thank you in advance.

Hi,
I beleive that, the Letter of Credit Processing is out of SAP Scope as of now.
All LC Charges you have to post manually or Z Object / Customiged Object to be developed for tracking the LC Expences and those values to be used for manual FI JV.
Regards
VG

Letter of Credit for Vendor Payments

Hi All,
We are implementing ECC 6.0 Version.
The client requirement is to create Letter of Credit for Vendors and to capture data relating issue of Letter of Credit, Terms of Payment and Expirition Date. Against a Single Letter of Credit issued to a vendor client may receive more than one Invoice till the Expiry period of the Letter of Credit and Value. Further, client may also amend the Old Letter of Credit by extending the validity period or the value of the LC.
I know that we can create letter of credit through Special GL indicator 'L'. But it is one Letter of Credit to One invoice for clearing. How to map one letter of credit to multiple invoices and how we can capture expirition date of LC.
Further same vendor can have multiple LC opened against them for different projects. Please let me know detailed configuration steps.
Best Regards,
Bhargav.
Edited by: Bhargava Ram on Oct 3, 2008 3:40 PM

Hi,
Sorry i guess my question is not clear. It is not to link any LC with PO
The client will raise a single LC against any import vendor. Since these are large CAPEX related purchases, the vendor will send multiple invoices. The bank will adjust the LC against the invoices. Post adjustment the bank will send th advice to the company.
My question was how we can adjust multiple invoices against a single LC
THanks
Sembian

Total Letter of Credit Process

Hi,
We need to implement Letter of Credit (LC) for one of our client. It is export/import business company.
Can we configure Letter of Credit in Fi or we have to go for another module for LC process.
And our client needs LC number in all the entrie process like LC number in Sales order, delivery note challan etc.
Sateesh

Hi
Thru TC-F-57 we can create letter of credit details as a noted item., which will gnerate a document with single line item.But once your LC is closed i.e payment to vendor is made we need to clear this noted item also.But how to clear pl. explain.
Shivaji

Letter Of Credit ( LC )?

is oracle payable and purchasing support LC? Is not What The Suggetion Work Around Must Go To Implemented?
Thanks

Just to give you an background, A Letter of Credit (LC) is a document issued by your bank that essentially acts as an irrevocable guarantee of payment to a beneficiary. This means that if you do not perform your obligations, your bank pays. The letter of credit can also be the source of repayment of the transaction meaning that the exporter will get paid with the redemption of the letter of credit.
Let me give you an example:
For simplicity sake lets imagine that your company imports Laptop from a Taiwan manufacturer called XYZ Computer, which banks at CitiBank Taiwan. Your company currently banks at OCBC Singapore
For the purpose of this example these will be the roles that the parties will play in the letter of credit transaction:
Your company : applicant
Taiwan manufacturer : beneficiary
OCBC Singapore : Issuing Bank
CitiBank Taiwan : Advising Bank
The example:
You want to buy $50,000 worth of desktop/Laptops from Taiwan Manufacturing, which agrees to gives you 60 days to pay it with the condition that you provide them with a 90 days letter of credit for the full amount. The steps to get the LC would be as follows:
1)You go to OCBC Singapore and request a $50,000 letter of credit with Taiwan Manufacturing as a beneficiary.
2)The bank goes through its underwriting process. Although the bank is not advancing money, they are extending credit on your behalf and are taking on a contingent liability. If your company qualifies from a credit standpoint the LC is issued.
3)Even if your company does not qualify for credit, you can still get an LC if you are willing to put cash collateral CD secured letters of credit are very common for small business specially in APAC region.
4)The bank sends a copy of the letter of credit to OCBC Singapore, which lets the vendor knows and the merchandise is shipped.
Take into consideration that the letter of credit itself might be the source of repayment of the transaction. It could be that Taiwan Manufacturing is interested in getting paid as soon as the stuff is shipped. Therefore, the letter of credit will indicate that payment shall be made as soon as Taiwan Manufacturing can present proof of shipping.

Letter of credit control

I try to implement the use of the letter of credit in SAP, all is working good except when I want to do a new control between the sales order and the financial document.
When I want to do a new control in the sales order (VA02), in the header Billing document view, I need to delete the field "Financial doc. No", do "enter" and fill again the field if I want to see the control result with the button "List Financial document"
Do someone know if there is a solution to not do those action before to have the control result ?

Standrd throug Risk manageemnt

Letter of Credit Functionality

Hi
We are implementing Oracle E-Business Suite for a Govt of India Organization on Release 12.1.3 Can anyone let me know if there is an inbuilt functionality for Letter of Credit Scenario in R12. to my knowledge it is not available in 11i
Regards
Anand S.

Hello Marias,
I regret to inform you that the functionality you request is not
implemented in the standard system within the Foriegn trade area.
" The documentary payment functionality (Letter of Credit) for vendors
is not available in SAP Standard System.
Documentary payments can only be created on the SD side for customer
but not for vendors.
At this time, there is no plan to develop this functionality. "
Please note that the Foriegn Trade functionality has been expanded and
is available in the solution product "Global Trade Services" (GTS).
As you are probably already aware information on GTS is available in SAP
Service Marketplace.
Regards,
Alex

Materials Management: Letter Of Credit for Vendor in SAP ECC 6.0

Hello Experts,
We are in the process of implementing SAP GTM for our Client.
One of Our Prime requirement is to map Financial Document "Letter Of Credit" for the Vendor in case Imports. I found that Letter Of Credit can be created only for Customer in Sales/Foreign Trade but the same option is not available for Vendor.
Does sap support Letter Of Credit in MM-Imports or in Finance for Vendors?
Thanks & Regards,
Ganesh

Hello Debasis,
Post EPC installation,you need to perform configuration of EPC through portal.You can see it listed under configuration--> configuration scenarios-->EPC.
During configuration you will be asked to define path of you primavera installation and a user on that system with sufficient permissions. This user is called APS user.
Try to do a mock configuration run on sandbox/dev system and then you can follow the guide.
Regards,
Hetal

Payment by letter of Credit against Purchase order

When we are purchasing from Foreign Vendors , we need to open a Letter
of credit (LC) .
Depending on the terms of Purchase order , Vendor will discount it /get
payment from Bank on submitting LC and other necessary documents.
Vendor's Bank, at appropriate Time will send the same to Customer's Bank
How to mapped this scenario in SAP-MM and FI .
Activities required to be updated against Purchase order :
(1) Payment Terms : 100 % against LC on delivery
(2) History should reflect LC opened - Date and Bank Name which
Vendor has suggested, our company's Bank Name
(3) LC discounted details
(4) LC payment due date to our company Bank - as Procurement needs
to inform to Finance for this.
Any help will be highly appreciated.
Thanks and Best Regards,

When we are purchasing from Foreign Vendors , we need to open a Letter
of credit (LC) .
Depending on the terms of Purchase order , Vendor will discount it /get
payment from Bank on submitting LC and other necessary documents.
Vendor's Bank, at appropriate Time will send the same to Customer's Bank
How to mapped this scenario in SAP-MM and FI .
Activities required to be updated against Purchase order :
(1) Payment Terms : 100 % against LC on delivery
(2) History should reflect LC opened - Date and Bank Name which
Vendor has suggested, our company's Bank Name
(3) LC discounted details
(4) LC payment due date to our company Bank - as Procurement needs
to inform to Finance for this.
Any help will be highly appreciated.
Thanks and Best Regards,

Shipment is to be blocked if Letter of credit date has expired

Shipment must be blocked (provision for Delivery order reversal) if Letter of credit Last Date of Shipment is expired:
Example as follow: - SO 100002703 item 10 - The LC with financial doc 1062 - The last shipping date of Finance.doc 1062 is 30.09.2011 - If user create new Delivery doc at 01.10.2011 ? system should throw error message - If user post Shipment doc at 01.10.2011 ? system should throw error message The validation should be applied for both initial shipment processing or replacement for return.
Edited by: Lakshmipathi on Nov 7, 2011 12:11 PM
Thread Locked - Reason Duplicate post

Hi
This can be achieved by using anyone of the user exits V56USVDP and V56UCHCH.
Regards
Srinath

How to deal with Letter of Credit in Oracle Payables ??

In case of letter of credit, an 100% advance payment is done to bank, Bank charges its commission,
The letter of credit is for goods imported which is part of inventory. As standard practices of finance, exchange gain/loss and expenses incurred to bring the inventory to its present location and conditions should form part of inventory cost.
This cost are not known at the time of PO, so only purchase price is ascertain.
How to track custom duty paid, insurance, freight, and cargo handling expenses incurred on material.
All this cost should be charged to item and according unit cost should be adjusted.

Well, when are these other costs known? Perhaps you do not know them until you get the invoice from the supplier? Are you then doing match to invoice (either match to PO or match to receipt?)? What version of EBS are you on? My initial off the top of my head though is that when you match the invoice to receipt, the quantity amount should match, but the cost amount would be higher, by the amount of these extra costs. So you would have to be sure you don't have any match tolerance that would prevent such a match. That would get the entire cost charged to inventory, and the unit cost on that invoice is Cost Amount / Quantity. Without knowing anything about your inventory setup, not sure how that would impact you.
Of course, if any of my assumptions are wrong, then my thinking will be wrong. Thus would be helpful to supply additional information about your situation.
John Dickey

How to track Letter of credit in FI Module.

Dear Gurus,
(Exports scenarios)
I have configured letter of credit for customer's export scenario. At end user level we are creating letter for credit using VX11N. Once the letter of credit is created, we link it to the sales order at header level in billing document tab - financial document field.
I would like to know how can we track this letter of credit in FI module? For example if we receive payment from the bank against letter of credit which is linked to sales order then how will we be able to track that letter of credit while entering the customer payment in FI module.
Also help me understand whether I am posting it to right forum, as I am posting the question for the first time here.
Please advice. Thank you.
Edited by: jayfanse on Jun 9, 2011 5:25 PM
Edited by: jayfanse on Jun 9, 2011 5:26 PM

Dear Jay,
We are also using letter of credit sale in our company but the LC payment is normal from accounting side when ever Accounts receive LC payment from the customer they will post it against customer account (Customer Code) and write the Text this payment against so and so LC and Commercial Invoice Number if you run FBL5N Report you can see this text.
There are some reports to check the LC sales scenario: VXA1, VXA2 & VXA3
Regards,
MH

Letter Of Credit Implementations

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