Letter of credit &letter of guarentee

Hi all
Can anybody help me with the basics of letter of credit and letter of guarentee and the configuration steps.
thanks and regards
maunami

hi maunami;
have u found any helpful information about letter of guarantee?????

Similar Messages

  • Letter of credit in Sales Order processing

    The Problem is related to LC(Letter Of credit) attached to Sales order.
    In some cases, when we raise a sales order and attach LC even if all the fields are matching in LC and sales order the value is not reflected in LC.
    One more problem is When the order is attached with LC it should not go into credit check but it goes into credit check and blocks the order.
    In Case, we are using revolving LC even if the payment is recieved from the customer the value is not getting update in the LC.
    The above kind of problems are also persistant in all sorts of documentary payments i.e Bank gurantees and Lc etc
    We are using documentary payments for foreign trade for special business trasactions where customer credit management should not be utilized.
    Any suggetions on the issue or insight in foreign trade and documentary payments will be highly appreciating.

    Hi sreedhar,
    U just have to do a simple customization as follows,
    Go to IMGSales and distributionbasic datacredit and risk mangement-forms of guarentee--assign form of guarentee with order type....
    in this case, asssign your letter of credit guarentte (assuming that u have alrdy created the letter of credit as a form of guarentee)  with sales oreder type OR..the u wont be having any problem
    Thanks,
    Krish

  • 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

  • Process flow of letter of credit and configuration guide

    Hi friends,
    I want to know accounting entries at every stage in letter of credit for purchase transaction, so also requesting for configuration guide. Points will be assigned
    my email id is [email protected]
    Thanks
    Edited by: keetu on Apr 22, 2008 8:35 AM

    Hi,
    Check these links.
    http://forums.sdn.sap.com/thread.jspa?messageID=3537642#3537642
    http://forums.sdn.sap.com/thread.jspa?messageID=5337739#5337739
    Regards
    Ayyallas

  • 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.

  • Re: Letter of Credit - Imports

    Hello,
    I want to map the process of letter of credit in case of imports in SAP.
    What the process is, we are making an import PO. Bank opens LC in equal to the invoice amount. We have to pay margin money i.e 25percent of invoice amount to the bank, in turn, bank opens the LC of 75percent of invoice amount. We are capturing the payment of margin money at 25percent in SAP.
    The point is, bank is giving the facility of 75percent for 90 days. I dont know how to map this scenario in SAP?
    Regards,
    SDN_Creature
    Edited by: sdn_creature on Mar 18, 2009 8:14 AM
    Edited by: sdn_creature on Mar 18, 2009 2:46 PM

    hi we doing like below
    we are created one special g/l indicato for letter of credits after that posted trhu f-40 letter of credits credit and vendor debit here we posted first line item only and after that thru process open items we are selected that vendor  item and posted after that at the time of payment thru f-53 we have cleared here we are enterd vendor number and special g/l indicator, bank outgoing account  after that we have selected that line items and posted i think it will be helpful.
    Regards,
    Nauma.

  • Financial documents/ Letter of Credit and down-payment

    Hi,
    I try to map requirements from business against solution in SAP.
    There is a scenario as follows, where part of the sales order is covered through down-payment. This should be exempted from Letter of credit value.
    Example
    Sales Order value 1 Mio USD
    Down-payment 0.2 Mio USD  > paid immediately after sending out the request invoice (request is generated in SD from Sales order). Until payment, this would remain as the net exposure in the system.
    LOC value should be only >> 0.8 Mio USD <<   
    Is there a solution in SAP to this? What would need to happen to enable this?
    Cheers
    Hein

    Hello Hein
    Well, for your requirement you have to go development.
    For this you can use No credit check in TCode OVA8 for Define Automatic Credit Control for your desired combination of Credit control area, Risk class & Credit group.
    Where you have to write a requirement with help of ABAPer.
    OR
    You can take assistance of FI guy and looking to define Reconciliation Accts Without Credit Management Update
    Where In this IMG activity, you can cancel the credit management update function for certain postings by posting to an additional reconciliation account; the reconciliation account without credit management update.
    When you make postings to the standard reconciliation account, the receivables total within credit management is then updated, but those postings made to the reconciliation account without credit management update are not.
    In Japan, various receivables that are considered certain to be received are excluded from credit management update, including:
    - Active prepaid/deferred items
    - Payments by letter of credit
    Hope this can assist you.
    Thanks & Regards
    JP

  • Credit Check againt letter of credit.

    hi,
    This is regarding credit check of sales order against FD. If the letter of credit belongs to company 001 and sales order contains any line items materials other than company 001. It gives an error EI574 "Financial Doc data check result not ok". Is there any way to do credit check ignoring company? I mean financial document will be in one company but sales order items can be from multiple company. Please share your expertise.
    Regards
    Achuthanandan

    Hi Achuthanandan,
    if the credit control area is assigned at company code level then this error will appear
    if the credit control area is assigned at the sales area level then this error will not come
    Regards,
    Santosh

  • Letter of credit check status not correct in VL01N

    Hi, Gurus,
    I activate both credit management and documentary payment. When I try to create delivery-VL01N with reference to a sales order, i assign an financial document with 100% depreciation. Suppse deliver amount exceeds this financial document, system should issue message and block this delivery. However, there were no such message and credit status is "A" when saving delivery.
    In Vl02N, not changing any data, system issue the message showing that
    the financial document value is exceeded, and delivery is blocked when I save the delivery.
    I checked my configuration, and cannot think of anything related to this.
    After debug, I found out that the reason is that SAP get delivery value from table S131, field  OLIKW and compare it with financial document open value. However, S131-LOIKW is 0 when I create the delivery. After delivery is created, S131-OLIKW value is corect. Therefore, when i change delivery and try to save before exit, system will issue the message.
    Does anyone know anything might be related to this weird issue?
    Thanks,
    Cicely

    Hi Gopala,
    The accounting document has already been released &accounting doc has been created. But the value of Financial Doc i.e Letter of Credit remains same.
    Regards,
    Mahendra

  • Letter Of Credit During Export sales

    Hellos Experts,
                             This is neo, I work for the client were they have export sales so they have the Letter Of Credit during the process. Now the scenario is that.
    I know some thing like I did the configuration setting for this In IMG (Foreign trade and customs >> Documentary payments) every thing is 5n. and the process which i fallow is
    va01
    vx11n
    vl01n-PGI also
    VF01
    VF02-release to accounting.
    when i am doing the sales order in the line item i am entering the LC num:":82" and saved the document. After this when i see the VX12N the 82 number then the lc value is decreased. after the completing of delivery and invoice and release also when im going to check the value of LC 82 is reamins same.
    here my qutions are:
    1) how to do the export sales process with LC
    2)the process which i fallow is correct or wrong
    3) what is the use of
         a) VKM3
         b) VKm5
         c) VXA3
    4) if during this process do i need to release the document using any special transaction codes
    5) The Main can I use Single LC to Multiple sales Orders.
    thanks and regards,
    Neo
    Edited by: neo.anu on Jul 24, 2010 7:32 AM

    Dear indrajit
    run VX11N and maintain the L/C details there and once saved, a reference number will be generated.  Go to sale order, select at Header tab Billing and assign this reference in the field Financial doc no 
    thanks
    G. Lakshmipathi

  • 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 (Urgent )

    Hi All,
    I needed to know if anyone has worked on letter of credit or have dealt with payment gurantee procedure configuration.
    Define and Assign forms of payment guarantee has 5 different configs. First one, Define payment guarantee schema - This part of this configuration controls the sequence in which system assign the sales document ITEMS to payment guarantee procedure. I want to know where actually we can see these sequences happening. I looked at the sales order (at the item level) but system is only picking payment guarantee procedure and form of payment gurantee. I don't see any sequecial order in which I set the config.
    Any input will be great!
    Regards
    Navneet Kaur Bhatia

    Hi Navneet,
    Letter of credit configuration is same as bill of exchange, with small changes.
    Hope the following link is useful to you:
    http://help.sap.com/printdocu/core/Print46c/en/data/pdf/FIBP/FI-AP-AP-BE.pdf
    also: Process Of Letter of Credit for Imports : http://www.sap-img.com/financial/process-of-letter-of-credit-for-imports.htm
    Pls assign points as way to say thanks
    Message was edited by:
            Ravi Rana

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