Chapter - 9. Credit Management

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Gerard Henderson
8 years ago
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1 Chapter - 9 Credit Management Purpose You can use Credit Management to minimize financial risks for your organization. Credit Management makes it possible for you to carry out credit checks in transaction processing, and it forwards documents that are blocked for credit reasons directly to the person responsible to be. Open order value The open order value is the value of all order items which have not yet been delivered. The open order value is based on confirmed quantifies (Confirmed quantities x Credit price = Open order value of an order). An order which has been blocked due to a credit check does not contain confirmed quantities. The open order value does not increase as long as the block remains in place. Open delivery value The open delivery value is the value of all delivery items which have not yet been billed Open billing value The open billing value is the value of all billing items which have not yet been transferred to Accounting. Receivables from sales are included in total commitments as long as they have not been indicated as disputed items. For more information, see the chapter on processing incoming payments and commitments.

be. Open order value The open order value is the value of all order items which have not yet been delivered.

2 Receivables from special G/L transactions are transferred from special commitments to total commitments if they are relevant to credit limit, for example payments. For more information, see the chapter on processing incoming payments and commitments. Dividing Credit Control Areas Internally When to Carry Out Credit Control Checks Use the system settings to specify when you would like to carry out a credit control check. You could require that checks be carried out only during sales order processing, Subsequent function in Sales and Shipping cannot be carried out as long as the relevant document is blocked by a credit check. A check carried out at goods issue can no longer block the transaction as goods issue is the final function in Shipping. If a credit check is carried during goods issue and the transaction exceeds the credit limit, it is not posted for delivery. The system issues an error message.

Dividing Credit Control Areas Internally When to Carry Out Credit Control Checks Use the system settings to specify when you would like to carry out a credit control check.

3 Static and Dynamic Checks This makes sure that sales orders planned in the future are not taken into account when determining credit exposure. The 'actual date' in this example is the initial date for determining the open order value on the credit horizon. The 'actual date' is the current date for each check. In an order, it is the date that the order is created or changed. In a delivery, it is the date that the delivery is created or changed. The sales order or delivery value may not exceed the specific value defined in the credit check. This value is stored in the currency of the credit control area. It is particularly applicable if a credit limit has not yet been defined for a new customer. You can initiate this check using a risk category defined for a new customer. When carrying out a check of this type, a credit check is triggered by changes made in the document to values of any of the credit sensitive fields. These fields are proposed from the customer master record, and include, for example, terms of payment and fixed value dates.

In an order, it is the date that the order is created or changed. In a delivery, it is the date that the delivery is created or changed.

4 Checking Against Next Review Dates Here you must specify a number of days. Without these 'buffer days' the system will carry out the check as soon as it recognizes that the next check date has been reached. The relationship between open items which are more than a certain number of days overdue and the customer balance may not exceed a certain percentage. Looking at the current and expected cash forecast: Menu Path Accounting/Treasury/ Basic functions/ Tools/ Compare cash mgt/ Summary Records Field name Company Code 3000 Cash management position Input Value Liquidity forecast un Value date Select the Execute Icon 01/01/2000 to 06/30/2000 Account Number

The relationship between open items which are more than a certain number of days overdue and the customer balance may not exceed a certain percentage.

5 Looking At the Cash Management Position Menu Path Accounting> Treasury> Cash management> Basic functions> Status> Cash management position Field name Company Code 3000 Cash management position Liquidity forecast Grouping Display as of Display in Select the Execute Icon. Displaying The Liquidity Forecast Menu Path Input Value un BANKS US Todays date USD Accounting> Treasury> Cash management> Basic functions> Status> Liquidity Forecast Field name Input Value Company Code 3000 Cash management position Liquidity forecast Grouping Display as of Display in TOTAL Todays date USD

Displaying The Liquidity Forecast Menu Path Input Value un BANKS US Todays date USD Accounting> Treasury> Cash management> Basic functions>

6 Select the Execute Icon Drill down on the bank and sub ledger lines to see the detail of the source of the data. Back up to the Summarized Display Select the New Display Button Select Delta Display with Balances Select Continue Entering a Payment advice for a planned outgoing payment. You have just received a notice that you must transfer funds to cover computer equipment purchased as outline below in the table. You will enter these payments in the Cash Budgeting system and observe the effect on the plan.

Payment advice for a planned outgoing payment.

Overview p. 19 Reports and Transaction Codes p. 20 Real-Time Processing and the Document Principle p. 21 SAP R/3 Replaces SAP R/2 p.

Overview p. 19 Reports and Transaction Codes p. 20 Real-Time Processing and the Document Principle p. 21 SAP R/3 Replaces SAP R/2 p. 22 Integration p. 26 SAP ERP Replaces SAP R/3 p. 26 New Features in