Credit management for IT industry

Hi,
As we want to use credit management functionality of SAP but really not understand how to implement it
Means at level check should be happen because we are a service industry where we have contract with customer for varying periods 1 year,2 year....etc and accordingly resources are deployed in it.
So our current process is we create the sales contract and do the billling of it.
So at what event ny credit event should trigger-- I can't stop billing bcoz efforts are already been put by resources and i can't check at order level as contract is for long period.
What is the actual process of credit management in a n IT industry ?

Hi Cecilia,
Please check below link. This could be useful.
http://scn.sap.com/thread/1892805
Regards,
Gaurav

Similar Messages

Letter of credit Process in Credit management for Customer/Vendor.

Dear Team
I am in need of some information on Letter of credit Process in Credit management for Customer/Vendor
If you have any information with examples on the same Pelase provide me the same.
Thanks
Mehda.

dear friend,
please look here:
http://help.sap.com/saphelp_47x200/helpdata/EN/2a/30b746b1d511d194f300a0c9306794/frameset.htm
good luck!

Credit Management for different Sales Order Types

Hello All,
The problem is related to Credit Management for Sales Order which is explained below with an example -
We have separate Sales Order Types for New Launches (ZNLS) & Normal Depot Sales (ZDPS) but both the Order Types are assigned with same pricing procedure and respective orders will be raised against the same party code.Now automatic credit check is only active for order type ZDPS where the credit limit had been set to Rs.1000. Now Rs,.500 had already been raised using order type ZDPS, then another sales order of Rs. 500 is raised using order type ZNLS.But when a sale order of Rs. 550 is raised using order type ZDPS the sales order is getting blocked, because the system had taken into consideration & added up the Rs. 500 value of ZNLS with previous value of Rs. 500 against order type ZDPS as a result of automatic credit check though it is not active for order type ZNLS.Point to be noted that Credit exposure is also not active for Order Type ZNLS.
How is this taken into consideration & what are the steps need to be configured so that the credit limit check will not get automatically activated for order type ZNLS and only remain active for order type ZDPS despite they are assigned to same pricing procedure and used for invoicing same party code?
Please suggest.
Thanks & Regards
Priyanka Mitra

Hi Mitra,
The issue occurs because of the fact that credit check and the
update of the credit values are separate processes which are also
controlled separately by the respective customizing:
1. credit check is controlled by transactions OVAK and OVA8.
According to the attachment, you have already refered to note 18613 to
check the customizing settings.
2. update of the credit values is controlled by VOV7 or OVA7: "credit
acttive" flag. The 'Credit active' setting only affects the credit
update of the SD credit values (open orders, open delivery and open
billing documents). This flag has no control on the credit check. So
if for an order type, there is no credit check in OVAK and OVA8 but
the "credit active" flag is set for the item category, the order will
update the credit values even if no credit check is performed for the
order.
If the flag "credit active" is not set, the system will not update the
open credit values. On the other hand, the system ALWAYS updates the FI
credit value 'Open receivable' when the billing document is transferred
to Accounting. So, although you deactivated the "Credit active" flag in
in OVA7 or VOV7, such an item will increase the 'Open receivables' and
thus the credit limit used when the corresponding billing document is
posted to Accounting.
If you would like the value from sales order type ZNLS is excluded from credit update, you could consider set the "Credit Active" field as blank in VOV7 for the item category used for ZNLS.
Best regards,
Smile

Credit management for consignment sale

Hi,
It is well accepted that in Standard SAP , for consignment sale process credit check is done in Consignment issue level as in this phase material stock is logically got diminished from valuated stock. But business dynamics need some solution with nature of business needs and from that point we need that how the same can be managed with consignment fill up. Consignment fill up is the stage where material is moved from plant gate to reach consignment agent's premises which is geographically may be located far away and this is the phase where user can want the credit check before dispatching more quantity with that of payment have received or with a threshold value of credit limit though the stock is under ownership of plant and that same will be transferred to customer after consignment issue.
now we have configured system in that way, KBN and KEN item category has been configured perfectly as needed(like credit indicator checked for KBN and unchecked for KEN item category).
But the problem is faced like following way.
Suppose I am doing a transaction of delivery against a consignment fill up order with value of 2 Lakh with that much credit limit and after making the delivery it got updated in FD32 open sales value (2 Lakh) which is correct in this context.
Secondly at the time of consignment issue delivery further open sales value is not updated with 2 Lakh which is also correct(as credit check is inactive as it should not be update the open sales value as 4 Lakh)
Lastly when we are preparing the consignment commercial invoice with reference of consignment issue delivery then after posting 2 lakh got updated in receivables in FD32 which is also correct but at the same time open value should be diminished to zero which is not updating and this is wrong as then credit exposure is calculated wrongly for next transaction. so huge value will be accumulated in open sales value for consigmeet agent and the same cannot be rectified by standard program RVKRED77 like normal customers.
So please explore what may be the solution for the same(may be any configuration setting) or if there any another correction program exists.
Regards
Indranil

Dear Mr. Lakhshmipati,
Thanks for your reply.
I need the input to be given that we are running the credit check with update group 000015 . So in this case S066- OEIKW will not update anytime.
As per note 492831 is declaring that for consignment fill up if the credit indicator is active but the table S066 - OEIKW will not update for open sales value in case of consignment fill up
But we have tested that after creation of the delivery against consignment fill up open sales value updated in FD32 (as item category KBN has set as credit active) and the same figure is coming from the table S067 - OLIKW.
But it is not duplicated with creation of the delivery from consignment issue(as for item catefory KEN this check is inactive) and after creation of the commercial invoice receivable got updated but same value should be cleared from S067 - OLIKW.
You can understand the situation.
Now there can be three aspects of it. Please check my points below and suggest if I am wrong.
1. For update group 000015, this table S067 is updated for delivery of fill up in standard SAP but never adjusted in after that and also there is no standard program for correction. So in this case either we have to forcefully update the table (by exit or by program) though it should not be the practice as there may be some inconsistency or we should discard this process.
2. We have to deactivate the credit check at consignment fill up level and to carry with credit check at consignment issue level as in that case under update group 000015 , after creation of commercial invoice posting receivables got updated with modification of open sales value by diminishing that much value.
3. We have to withdraw the credit check for case of consignment agent.
please suggest if any other aspect keeping in mind that we have to try our best to reach the requirement of credit check at consignment fill up stage as material should be blocked for delivery before vehicle starts from factory gate.
with last effort if there is really no way , so we have to go with standard SAP.
Regards
Indranil

Warnings in FSCM Credit Management for negative credit check.

Hello,
I am implementing FSCM Credit Management. I have below requirement.
At the time of creation of sales order, if credit limit is exceeded then only warnings are required, Sales order should not go in the block (as available in earlier SAP AR Credit Management)
Is this also possible in FSCM Credit Management ? As in the configuration for credit rules, in the log , only extensive log, no log & error message is supported. Follow up event also has option of blocking business partner or workflow once credit check is performed & if it is negative.
Thanks in advance.
Abhishek Govilkar

Yes it is possible thru define autometic Credit Control ( OVA8).
In the " View for maintainace of Autometic Credit control" screen under the "checks tab"
select check box - sap credit management
reaction - c
status/block - unchek
Regards
Rinku Bhowal

Problem with credit managment for FI-documents

Hello,
is there any possibility to modify the value "Total receivables" for the creditmanagment?
I customize the position-type as not active for "credit active" and the values for the sales part are set correctly for the credit managment.
But everytime I create an invoice and the FI-documents are created, the value for the "total receivable" in report
RFDKLI40 is wrong.
If I create a new sales document then, the creditmanagment checks with the wrong value from "total receivable" and that´s wrong.
Line " where vbeln = lt_vbrk-vbeln
and cmpnt space."
in report LVFDSF02 is set.
Thanks for your help
Nicole

After Apple tightened up some security issues the stores have been a bit more picky about the format of the billing address. Most folks who have encountered this issue have been able to solve it using the standardized addressing format created by the US Postal Service. Go to the USPS Zip Code lookup website and enter your address. Copy your address exactly as the USPS formats and presents it into your iTunes account.
https://tools.usps.com/go/ZipLookupAction!input.action

Inventory Management for Airlines Industry

Does Oracle offir a solution that allows an airlines to manage its inventory? I have a customer who has heard and read that Oracle's Inventory Management module will work with the special requirements of the airline industry. Is this true?

Hello,
Currently they are havingSAP-HR.But i want to integrate HR with inventory management(Like issue,receipt,scrap,consumption)

Credit management for advance payment

Hi
If the customer pays any advace system have to consider that amount also for credit check
the example as follows
customer credit limit 300000 as on to day
customer receivables 300000 as on to day
customer advance 200000 as on to day
If i create the sales order for 10000 to day, system is blocking the order to deliver because of credit limit exceed, what i want to do if the customer having advance it should not block the deliver.
regards

Hi,
Go through through this thread,
Credit against advance payment
Thanks,
Swamy H P

Credit Management for Deliveries

Dear SAPians,
Have some questions regarding the above topic:
My setting in OVA8
Open items (ticked) Reaction (B) Status (ticked) Max.open.item % (0) NoDays openI (61)
Questions:
1) On occasions when there are open items outstanding which exceeds 60 days, the message 'Max % open items exceed' appears when creating Delivery Note. System does not allow me to save the DN. After releasing the Sales Order via VKM3, sometimes it allows me to create and save the DN. Other times it does not work. Can anyone advise me on this problem?
2) I would like to know how does the system actually handle the config above when there is a credit check on maximum % open items. Is it thru VKM3 credit release or getting customers to settle the outstanding open item?
Thank you.
Regards,
David

Dear GSL,
Thanks for the info. I would like to keep the config that way to track all open items for credit check purpose. It would be good if you can help to answer the questions I posed as they are the my main concern.
Regards,
David

Credit management for Old sales orders

Hi experts,
pls consider the follwing example where i am facing some problem.
I activated the Credit lock system in Sales order level (Warning message with release strategy)and in PGI. (Warning message with release strategy).
Customer A
C.limit : 10000
Outstanding : 7000
Sales value(Without pending sales order value): 2000
Eli gable new sales order value 1000
Pending sales order value 5000(Sales order no 111)
Now if i process this old SO no 111 in VL01N i am getting error that Order blocked due to credit limit. But i activated dynamic credit control only in sales order and in PGI.Not activated in VL01N level.
Awaiting for your valuable reply.
Thanks
SR

Hi
1.KIndly check in the sales order that you have maintain the payment guarentee procedure because of this the system is not allowing to do the delivery
PATH: VA02sales order no-Go toItembilling document---payment guarentee procedure
so kindly check that and remove or assign the financial document to that for processing the billing
2.Check the credit lock procedure is release or not
By doing above the issue will be resolved,kindly check and confirm.
if you have any further clarifications let me know
REgards
Damu
KIndly check the belwo

Not able to see specific tags for FSCM Credit Management on BP master data screen

Hi All,
I have already set up Collections & Dispute Management,
I am now on my way to start FSCM Credit Management setting up. I have already created the BP role (UKM000) and assigned it for direction customer to BP, but I am not able to see any specific tag on BP Master data related to Credit management, (just as I can see "Collections profile" tag, in reference to Coll. Mngmt).
So, I am not able to see these tags yet: "Credit profile", "Credit worthiness", "Cresit limit and control".....under Credit Management BP role!
What am I missing there? Have I got to activate BAdi UKM_R3_ACTIVATE in order to be able to "see" those BP tags???
....Or what else?
I will reward with points if someone can provide me any hint about this issue.
Thanks a lot.

Hi Pallavi,
Many thanks for your quick response. However, I have not succeeded in seeing that tab.
Let me tell you, I may be confused by a document I downloaded from internet about the BP master data views (as for the FSCM Credit Management role, of course) . Please find below the commented tag. It is an imaged I copy to you from that document I told you, for you to see which tag I am talking about:
I don´t know the content of that tab...but I would like to see it in place....you know..
Now, I checked you last answer and I saw that everything was already set by factory, please find below:
BUS4 view:
BUS5 view:
However, I´m still not able to see the tab I told you at the beginning (first image). Am I confused about something here? Many thanks for your patience (these things happens when you set FSCM Credit Management for the first time).
Is that tag accesible?
Many thanks!
Wilson

Credit Manager

Dear SAP Experts,
PLease tell me how do I configure Industry Credit manager for my system.
I want Bussiness Partners in the Customer master as Credit Manager.
Who will only have the authorization to release a failed credit check.
I have configured Automatic credit check and its working fine.
The credit manager would be a person form management in payroll, the employee number would be taken from the employee master.
CAN ANYONE EXPLAIN THE WORK FLOW CONFIGS STEPS
Edited by: EXPLORING MULTIDIMENSIONAL SAP on Sep 6, 2008 4:00 PM

This is workflow. The procedure is as follows:
The organisation management should have been implemented. This is a prequesite since the levels will be defined there.
Next yu need to define the sender and the receiver and the credit manager authorisations.
When you create a credit memo request, the created event is triggered for object BUS2094 and the workflow template 20000009 is started.
The system checks how high the net value of the credit memo request is. If the net value is below limit 1 (minimum limit), the system automatically releases the credit memo request in background processing.
If the net value of the credit memo request is over limit value 1, the system terminates workflow template 20000009 and initiates workflow template 20000019.
The relevant employee, depending on the value of the credit memo request and the organizational structure in use (sales organization, distribution channel, division), is then informed of this by the arrival of a work item in their integrated inbox. If the employee releases the credit memo request, the system ends the workflow and deletes the work item from the inbox.
If the employee stops processing the work item, it remains in the inbox until it has been
completed and only then is the workflow finished. If the employee changes any of the determining factors in the credit memo request (such as net value), the net value of the credit memo request has to be re-checked. The system deletes the work item from the inbox.
Workflow template 20000009 receives a terminating event and workflow template 20000019 is triggered. Depending on the value of the item, the relevant employee is informed and receives a work item in their integrated inbox. Once the employee has finished processing the work item (by rejecting or releasing the credit memo request), the workflow is concluded. If the credit memo
request is changed, workflow template 20000019 is called up. Processing continues until the credit memo request has either been rejected or released.
This is very technical. It would be better to consult a workflow or a basis consultant for this.
regds
Jude

Work flow in Credit Management

Hello SAP Gurus,
we need to trigger a mail to the finance manager whenever the credit limit of the sales order exceeds
Please suggest us the business object which can be used for credit management for sales orders when credit limit is exceeded.

Hi
Check the following link;
http://wiki.sdn.sap.com/wiki/display/ESpackages/CreditManagementBusiness+Objects
Regards
Chandrasekhar

Regarding open items in credit management

Dear friends
My query is that is it possible to restrict credit management for credit and debit open items? See i am using oldest open item blocking in my scenario. Now credit and debit amounts are both considered as open item for credit management. I want only invoice (Debit entry) for consideration and not his payment(credit entry).
Please advise is it possible or not and if possible where to define that???
With regards
Inder

Hi,
All business have their own credit management needs, SAP allows you to specify your own automatic credit checks based on a variety of criteria. You can also specify at which critical points in the sales and distribution cycle the system carries out these checks.
SM30 - Table/View
V_TVTW Define Distribution Channel
V_TVTA_KKB Assign sales area to credit control area
V_T014 FI - Define Credit Control Area
T001CM - FI Assign Permitted Credit Control Area to company code
OVXG - Set up Sales Areas
e.g. Sales Organization
Distribution Channel Division Distribution Channel Division
FD32 - Customer Credit Management
OVAK - Define credit limit check by sales document type
Check Credit
A Credit limit check and warning message
B Credit limit check and error message (no sales order can be created)
C Credit limit check and delivery block (block delivery if hit credit limit)
Options B and C -> used for checking open order values (when you create/change the sales order)
D Automatic credit control with open order values
More control in transaction OVA8 - Automatic credit control
You check for open orders and deliveries, or just open deliveries.
or open order values with other options
Credit group
Allows you to combine different sales document types for the credit limit check
VKM1 - Blocked SD Documents Finance have to released the delivery block
OVAD - Define credit limit check by delivery order
whether the automatic credit check occurs at the time of delivery creation and/or goods issue
OVA7 - Define credit limit check by item category
Set whether to include/exclude item category for credit limit check
OVA6 - Define credit group. You can groups together different business transactions which should be dealt with in the same manner with regard to the credit check.
You enter the credit groups when you configure the sales document types for credit management and define the (D automatic credit check).
SAP default credit groups
01 credit group for sales order
02 credit group for delivery
03 credit group for goods issue
OVA8 - Automatic credit control Double click on the line items
You can have the followings credit limit check :-
Static
Depends on the customer total value of open orders, deliveries, billing documents and open items.
Open items
No of days open
Overdue open items checks is based on the ratio of open items that are overdue by a certain number of days.
Max open items %
The customer balance must not exceed a certain percentage.
Oldest open items
If you dont want to deliver to the customer at all when even only 1 invoice is overdue.
Tick the Check for Oldest Open Item and Set the field Days oldest item = 1.
Days oldest item
No of days allowed for overdue or payment terms.
Use of the credit check Oldest Open Item. If a user attempts to alter the order quantity of a released sales document
that was previously blocked, it would be reblocked again by the system. The system only reblocks the sales document if the new order quantity is above a certain % amount.
Released documents are still unchecked
The preset % is whatever you want to set it as when configuring your automatic credit processing. You enter a deviation % and number of days,eg, you can set it so that an order can be changed by up to 10% within 30 days of original order entry date without it going back on credit block.
Next Review Date
If a customer has a credit limit of 1000 USD, and you would like to restrict this credit limit only to be available in current month (say March). If the document day is in April then the credit limit is zero.
You can use the NextReview date and Number of days fields and combined it with the Last int.review field in customer credit master Status view (FD32).
VOKR - Display of work list for credit management (configure the display variant)
regards,
Siddharth.

Credit Management : SD/FI/MM?

I have a the following requirement & need your expert opinion, is it possible to have solution or not.
1. Customer X has Credit limit - 10 laks ; this has been given thru FD32 : I invoice 14 lakhs every month
now the same customer is a vendor for me. I buy material for worth of 5laks every month.
my requirement when the custmoer credit liimit exceeds and not allowing for delivery until & unless mannual increase credit limit from 10 lakhs to 14 lakhs thru fd32, but at the same i have vendor outstanding amount of Rs.4lakh on account material bought by me. is it possible without enhancing the credit limit can the vendor outstanding is connected to customer credit management so that without increasing in credit limit i wanted to deliver/invoice.
kindly let us know whether this is possble to attach in customer account the vendor account so that the credit mangements takes automatically and allow the billing to maximum outstanding amount including credit limit which is already assigned.
please help
thanx in advance
srihari

Hello Srihari,
Please try this:
The answer to you is so sipmle..you dont have to woory abt it...SAP is having all the provisions for it when they ve designed it...
Simply go the the csutomer master , and select control data tab...enter the vendor number there,,remember this should be the vendor which you want to adjust his account with. Now go to company code data and check the option "Clearing with vendor" .
Simillarly go to Vendor master, and control data tab, enter the customer number there. Also go to company code data, and check the "Clearing with customer" checkbox.
By doing the above simple configuration, you can be able to offset the amounts receivables/ payables between ur vendor and customer. This will be useful in cases where the customer acts as a vendor or vice versa.
I have taken the above text from the last message in the thread:
credit management for linked customer and vendor
Try it & Let us know.
THanks,
Jignesh Mehta

Credit management for IT industry

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