Interest rates in payment term

Hi Gurus,
We have one requirement to create a payment term like this "Payment due within 30 days and 1% interest per month". How can we set interest rates in OBB8 transaction?
Regards,
P Gomatheeswaran

Hi,
In the Transaction code OBB8 you can define the INTEREST RATE and no of days for which till interest applies
goto the details of the Payment terms in the same transaction and in the screen you can find the tab with PAYMENT TERMS---installment payments.
In that tab you can enter the Percentage as 1% and no of days as 30.
So the interest will be 1% if the payment is due for 30 days.
Hope it is clear,
Please check and revert back if u need more details
thanks,
santosh

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Interest rates as part of Payment Terms

Dear Experts,
I have the following scenario :-
- Client has a Payment Term of 28 days for its Customer
- If the Csutomer pays within 14 days, they are not chanrged any inerest (hence client gives 14 day inerest free credit to its Customers)
- Once 14th day is passed client start charding Interest @2% upto 28th day.
- Once 28th day is passed then (Due Date crossed) client start charging Penalty @5%.
In other words, although the Due Date is 28th day, as per agreement with its Customers, our client can charge Interest after 14 days. If the customer pays within 14 day - they pay NO Interest. Once 28th day is passed, Penalty is charged on the due amount.
Can you please guide, if this can be made possible in standard SAP using Payment Terms.
To determine these rates, I could not find the configurations. Do I need to go by the Function Module DEBIT_INT_RATE_DETERMINE ?

Hello Venkat,
AS per my knowledge you can not calculate interest using Payment terms. In payment terms you can calculate discounts.
I think you need to use Function Module DEBIT_INT_RATE_DETERMINE

Variation of payment term with po term.lastest rate is not picked up,*

Dear SAP
Variation of payment term with po term.lastest rate is not picked up,
Irregular rate is uploading on system.document attached
*Reagards
MERUGU HAREESH *

there are payment terms at comapny code level AND purchasing org level, because you may get vendors for which you dont need purchasing views, such as customs or restaurants, where you never place a purchase order at. And other vendors like goods suppliers may never need company code views because you will never pay them.
So each view serves its own purpose.
It is not possible to just ignore maintenance at one level and get the payment term for an other organisation.
Especially as you can have several purchasing organisations within one company (if you purchasing wants to differentiate purchases of direct material from MRO purchasing) or you have one purchasing org for several company codes.
And not always is the payment term equal then.
If you are certain that the company code payment term is always equal to purchasing org payment term, then copy it over with mass maintenance and everything is fine.

FB70 - Payment Terms and discount rates

Dear Friends,
We have a requirement in transaction FB70, in which we
wanted to provide 3 different discounts for a given payment term, but the transaction by default provide only
2 discounts. Is there a way in which we can add a third
discount for a payment term.
Thanks & Regards,
Kanthimathi

We have a similar requirement to add additional discount rates to the payment rates. I found OSS Note 641960, which says, it has more options in EBP 3.5, which is CRM application I guess.
Can anyone reply to this message, and help us, if there is any other solution
we can implement to add additional discount rates in an R/3 system 4.6c or 4.7?
Thanks in advance,
Saleem

Final price of the Sales Order calculation on payment term

Hi,
Out Business requirement as follows.
1) one ZNAP pricing condition will be maintained by the monthly wise by business for pricing. this is a statistical condition only checking at sales order level only. this condition will check with Final price of the Sales order.
Now the requirement is
1) based on payment term of the Sales Order. plus if its a credit payment if the its CASH payment. these deduction should be added to ZNAP condition, and same will calculate with Final price, while creating Sales order.
For Example:
ZANP condition maintained 1000 USD.
while creating the SO:
If the payment term of the customer: PT30, ( it means payment with be in 30 days of the bill creation date)
system should do the below calculations
1) Scenario
Sales Order: Final price :                                       1500 USD( maintained by the Sales User while creating the SO)
ZNAP price                      :                                    1000 USD
according payment term 30 days                            20 USD ( as per table maintenance for calculation of the payment term.)
Calcuation:                                                          1000+20= 1020 (approximate need to add as interest rate)
Then final it should display final price 1500-1020= 480 USD.
2) Scenario:
If the payment term Cash:
ZNAP                                                            : 1000 - 20= 980 ( approximately and deduct, from the condition due to cash payment its like discount)
calucalte"                                                       1500-980= 520 difference
this purely internal pricing calculation with final price...
pl let me know how to get this in the pricing. and payment could be 30 days, 45 days 60 days etc.
Thanks.

Hi M Sham,
I believe your requirement can not be met with Standard pricing and you will have to create Routines for getting this result.
From scenario I believe you will be doing below points:
You should Create Z-Table with Payment Term and respective rates against those payment Term.
You should create a statistical condition type(Ex. ZNP1) and create Calculation Type routine with Logic to get KOMK-ZTERM field and derive value from Z-Table and update XKWERT field.
Calculate addition of ZNAP and ZNP1 (With +ve or -ve Signs)
And then again make deduction of derived value from Finale Value.
Do let me know if I have misunderstood your question.
Regards,
MJ.

Function to get the interest rate

hi;
iam trying to develop a function to return te rate of a loan knowing the original ammount, monthly payment, term.
basically what i need is the same as rate function in excel but i cant find the matematical function to calculate the rate
thanks
orestes

I found this formula on http://www.fonerbooks.com/solving.htm
the guy borrowed 100,000 for the mortgage and is making monthly payments of $830.33 for 15 years
looks like to solve for the interest they take the equation
P / M = [ i(1 + i)^n ] / [ (1 + i)^n - 1]
and make a guess at the interest rate and keep incrementing until the two sides match (or are close)
anyway I did in sql starting with and interated .01% interest rate and and incrementing by .01% for
10000 iterations and I ordered by the smallest difference between the two sides of the equation
and came up with 5.75% which I believe is correct
WITH variables AS (    SELECT 100000 M,
                              830.33 P,
                              180 n,
                              LEVEL * .0001 i
                         FROM DUAL
                   CONNECT BY LEVEL <= 10000)
SELECT i * 100 || '%' interest_rate,
         P / M,
         ( (i / 12) * POWER ( (1 + (i / 12)), n))
         / (POWER ( (1 + (i / 12)), n) - 1)
    FROM variables
ORDER BY ABS (
          (P / M)
           - ( ( (i / 12) * POWER ( (1 + (i / 12)), n))
             / (POWER ( (1 + (i / 12)), n) - 1)))
INTEREST_RATE     P/M     ((I/12)*POWER((1+(I/12)),N))/(POWER((1+(I/12)),N)-1)
5.75%     0.0083033     0.00830410087019666
5.74%     0.0083033     0.00829874710327995
5.76%     0.0083033     0.00830945655888689
5.73%     0.0083033     0.00829339525864719
5.77%     0.0083033     0.00831481416883952
5.72%     0.0083033     0.00828804533680813
5.78%     0.0083033     0.00832017369954276
5.71%     0.0083033     0.00828269733827184
5.79%     0.0083033     0.00832553515048413you could probably make this better so it doesn't have to do all the iterations if you use a recursive with or the model clause
and stop when the difference between the two sides of the equation is less then some number.
Edited by: pollywog on Feb 18, 2011 3:11 PM

Automatic calculation of charging of interest on late payment onLO

Hi.
my query is that user want that SAP calculate interest on late payment automatically for lease out.
is it possible in real estate?

Hi,
As Franz said, there is no standard functionality in RE, but you could use the Adjustment program to achieve that result.
You can customize an index based rule with your interest rate and default that adjustment rule for the condition that needs to be accounted for interest.
The problem is that if you choose to follow this approach, you will have no intergration with FI-AP and the adjustment program will not check which contracts are overdue and which not.
KR,
Severina Kolleva

TRM: doubts in interest rate instrument and Business partner

Dear all,
While implementing Treasury Risk Management, in order to fulfill my clientsu2019 needs I have three questions regarding, 1. Interest rate instruments, 2.Leasings and 3.Business partners.
1.When creating a contract of an interest rate instrument , associated to a floating interest rate (e.g. EURIBOR 3M), how can I calculate the tax stamp which represents 4% of my interest rate amount, and occurs every time I have to pay interests?
I could define it in the u201Cother flowsu201D label but since the contract is associated to a variable, I never know how much my 4% of tax stamp calculated over the interest amount will represent.
2.When creating leasing contracts, how can I calculate the VAT associated to the periodic payments?
3.Is there any way to make postings to a business partner directly as a Vendor or a costumer?
Thanks in advance,
Regards,
Daniel

Hi,
Please consider following:
1. Generally TDS flows are generated automatically by system based on a revenue/expense flow. By configuring Derived FLows in system you can achieve this. Then alongwith every interest payment flow a TDS flow also will be generated based on the rate defined in system with seperate flow type, you can define account posting in spro.
The path for config- TRM-Trans Mgr- Money Market-Transaction Mgt- Flow Types- Derived FLows
2. Again since VAT is a derived flow for an actual cash flow, so you can achive this through derived flows config.
3. You can make posting to Business Partner account by performing following:
a. In master data, assign role of Customer to the Business Partner
b. Make payment settings in transaction to Customer and select payee/counterparty. While posting with TBB1, entries will be against Customer A/c and further clearing will be reqd at customer level against respective payment bank.
c. To achieve this output, you may require to define account determination accordingly for customers.
I suggest to post seperate thread for each issue rather than posting with single thread for better response.
Regards
Prasad AV

Variable Interest Rate Instrument scenario

Dear All,
Is it possible to create an Interest Rate Instrument with variable interest rate which is calculated and adjusted monthly but interest amount is paid quarterly.
As per my understanding creating Interest Rate Instrument with Variable Interest Rate and which is adjusted monthly is not a problem. But if we do that the system calculates interest monthly and tries to post it monthly and also creates payment Request for each monthly cash flow.
This is the issue we want the system to calculate the interest monthly and also want that monthly accruals are calculated correctly but we want the interest to be paid quarterly and not monthly.
Request your thoughts on this kind of scenario.
Thank You
Regards
Sachin

Hi,
In your IRI instrument, maintain the interest condition to have a quarterly payout. In the structure tab, click on the conditions and then click on interest rate adjustment condition. In that you can specify the interest rate condition item to adjust to monthly update. Thus you can perform interest rate adjustments on a monthly basis and have the interest payout on a quarterly basis.
Regards,
Ravi

PO release in case of changes in Variance or Payment terms

Dear All,
In case of any changes in the PO other than the qty and rate, if we want new release to be effected for other fields tehn what is the way out.
Eg. Changes have been made in the payment terms, or delivery variance (over and under) then what is the way out.

Hi,
first of all, maintain version management.
You can configure ur release strategy if other fields just like Tax code and delivery Date.
For this u have to add that field in Structure CEKKO. for E.g. to add Tax code field in CEKKO, u have to append the MWSKZ to this structre first.
and create a charateristic for that criteria and add this there and configure to ur release class.
Try this one may help ur Query
Regards,
pardeep Malik

Vendor Master Payment Terms and Reconcillation account

Pls tell me In SPRO where Payment Terms and Reconcillation account's are maintained for Vendormaster

HI Vinay,
Your question isn't clear. You want to define Payment terms and Reconciliation account for Vendor Master record ?
If this is correct then go through the below path for payment terms & Reconciliation Account.
MAINTAIN TERMS OF PAYMENT:
SPRO > REF IMG > Financial Accounting > Accounts Receivable and Accounts Payable > Business Transactions > Incoming invoices/Credit memos > Maintain terms of payment (or) OBB8
RECONCILIATION ACCOUNT
Accounting > Financial Accounting > General Ledger > Master Records > Individual processing > Centrally (or) FS00
Enter G/L Account No. XXXXXX
Company Code AAAA and select CREATE button.
Under Type/Description tab
Account Group LIABILITIES
Balance sheet
Short text A/P (or) SUNDRY CREDITORS A/C
G/L acct long text A/P A/C
Under Control data tab
Account currency INR
Reconciliation account for A/C type Vendors
Under Create/bank/interest tab
Field status group G067 and SAVE.
Rams.N
If this is helpful, assign me points

Adjusting AP Payment terms to allow for mail service

I am interested in adjusting the Accounts Payable process to release payments earlier than the payment terms (e.g. Net 30 payment would release for payment on 28th day) to allow for postal delays. Is that possible on across the board for all payees?

Hi Chris
In the automatic payment run(F110), in the parameters tab -> input a date which is two days ahead in the filed 'Customer items due by' and input todays date in the field 'Docs entered up to'
Ex: If the item is due on Sep 14 then input details as below
Docs enetered up to: 09/12/2014
Customer items due by: 09/14/2014
System will pick up all items due as of Doc entered up to date + till the date in Customer items due by.
Run the payment run the above inputs and check if the next few days due items are pulled into or not.
Thanks,
Sekhar

Payment term issue "error payment term is not defined"

I have created a new payment term, and incorporated in customer master and created sales order . payment term is getting populated in sales order with an error "payment term is not defined". Please help to resolve.'
David

There can be many possibilities for this error, in tcode OBB8,
- the terms of payment is not marked for customer.
- date limits are not mention properly.
- if the installments are not config properly
Or
Try it putting manually in to the sales doc.
If problem persists, take assistance of FI team member to sort out the error.
Also, refer following SAP Notes:
- 66529 F5839 Payment term & not defined
- 598025 Work method terms of payment for condition records
- 1180397 enterprise SOA conversion/Supplement to Note 117317
- 311514 No payment method for installment terms of payment
- 649567      EDI: incorrect baseline date for payment
- 208023      Posting bill doc ->FI:incor cash discount rate used
- 391939      Entries ignored with warning messages in sales document
Thanks & Regards
JP

With holding tax base amount for 1099 vendors with discounted payment term

Hi Friends,
We have a below situation for 1099 vendors,
Some of the 1099 vendors are set-up in the system with payment term with discounts i.e. 2% if paid within 10 days
As per config, system posts with holding tax base amount at the time of posting payment.
With holding tax rate is 0%,
Based on modified net amount calculation
and
Cash discount calculation before w/tax calculation
When we have vendor with input tax, system excludes tax amount at the time of payment but for the with holding tax base calculation amount system does not exclude input tax type.
Which causes difference in 1099 misc vendors
Below is the example of how system calculates the amount.
Invoice $ 1000, payment term 2% if paid within 10 days. Input tax 7.25%
Payment going out=
$1000- $ 72.5(tax 7.25%) = $ 927.5 18.55 [2% discount] = $ 908.95 (payment amount)
With holding base calculation =
$ 1000 100 (2% discount) = $ 900
Difference between payment going out and with holding tax base = 908.98 900 = 8.98
Can some one please tell me how to get rid off this difference?
Moreover, please tell me if its normal to have 1099 vendors with discounted payment term.
Any thoughts on above situation will be helpful
Edited by: Shefford William on Jan 28, 2008 11:36 PM

Dear All
i am also having the same problem. The example is
Net invoice Value   = $ 100,000
Input Tax @ 15%   = $ 15,000
Total Invoice Value = $ 115,000
Cash Discount = 20% with in 20 days
On payment the system behavior should be
Debit Vendor invoice Value   = $ 115,000
Debit Cash Discount @ 20%    = $   20,000   ( 20% of the Net Invoice Value that is 20% of $ 100,000)
Credit W/H Tax deduction @ 3.5% = $ 3,325 ( 3.5% of 95,000 the Inv Value - Cash Discount that is $ 115,000 - $20,000)
Credit Bank Account = $ 91,675 ( Inv value - Cash Dic - W/H tax that is $ 115,000 - 20,000 - 3325 = 91,675)
However at the time of payment system is calculating tax as follows
Debit Vendor invoice Value   = $ 115,000
Debit Cash Discount @ 20%    = $   20,000   ( 20% of the Net Invoice Value that is 20% of $ 100,000)
Credit W/H Tax deduction @ 3.5% = $ 3,220 ( 3.5% of 92,000 the Inv Value - Cash Discount that is $ 115,000 - $23,000. This $ 23,000 is only calculated for W/H tax calculation that is 20% of $ 115,000 )
Credit Bank Account = $ 91,780 ( Inv value - Cash Dis - W/H tax that is $ 115,000 - 20,000 - 3220 = 91,780)
this is not the common practice when using the net base value in the system.
Can any one help me in this regard. I really have been stucked in this problem for many days
Regards
Bilal Athar

Payment terms for different products from a single vendor

Hi Pundits,
Our client has a requirement to assign different payment terms for different products. Each product he buys from his vendor has it's own payment terms. He wants us to customize in such a way that when he/user enters the invoice, not only the vendor number is shown along with the product name but also the payment terms for that particular product are calculated.
I know that only one payment term can be assigned in the vendor master data. Is there anyway to get around this?
Creating the same vendor multiple times and assign payment terms looks a possible option but that looks quite hectic cause he has close to 1000 payment terms.

Taurian, thank you for that suggestion!
I can maintain as many existing payment terms as the client has with his vendors and let him choose the payment terms at the time of invoice entry.
The only problem is that he might have to change it according to the current market rates for that product. So maintaining any payment term is of little use.
Edited by: Dummy_Variable on Aug 16, 2011 8:26 AM

Interest rates in payment term

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