Solution Document

EILSD19

EILSD19: Settlement Management

Solution Document

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 Solution Document
EILSD19

General information
Reference ID. EILSD19

Priority Med

Version 1.0

Business Owner

Description Settlement Management

Prepared By Satyaki Singha

Date of Creation 09.09.2019

Approvals

Signature and Date

Satyaki Singha

Consultant Project Manager Business Owner

Revision History

Version Date Modified Modified By Brief Description of Change

1.0 09.09.2019 Satyaki Singha Initial Draft

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EILSD19

1. Business Requirement

In EIL Sales scenario there are cases where Bill to parties (Principal Buyers) are liable
for discounts or commission for fulfilling certain target/criteria in sales billing for a
specific period of time.

Business requirement is to accumulate the accruals (payable to customers) during a

particular period and settle those accruals via credit notes with reference to Billing
document type (in SD module).

2. Business Issues in current process

Currently business is accumulating the Customer payments in sales order pricing

conditions, during final billing the conditions are posted in FI as accruals. The settlement
of these accumulated accruals is manually done via FI module generally by issuing
credit notes.

 There is no reference billing document to support the accruals hence there is no

tracking of actuals and settled amount.

 As the credit notes are issued manually there are high chances of human error,
the settled amount may vary from actual accrued amount.

 No reporting of the above-mentioned process

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2.1 Solution: Settlement Management

Settlement Management functionality (earlier Rebate Management) supports all types of

settlement processes, including core business processes order-to-cash cycle through
condition contract settlement (rebate settlement).

The general process in the Condition Settlement differs from the standard Rebate
processing in the sense that there are no rebate Agreements at the first step. There are
Condition contracts which need to be created and released.

2.2 Process Flow

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Step: Maintain Contract

1. Create condition contract type with relevant organization data

2. Enter the customer and period for which you want to create the condition contract.

3.Specify which invoices are relevant for application of this condition contract.

4. Enter the Settlement Calendar. This step defines when you would like to carry out
partial/final settlements.

5.Create rebate condition type and records, as other SD functions rebate settlement
also uses condition technique.

Step: Release Contract

6.Release Contract.

Step: Sales Process

7. During Order processing if the Sales document is created after the contract creation,
REBA accrual condition (standard condition type) would be available in the conditions
tab. (we have to add the condition type in sales pricing procedure)

In case the Sales document is already created before the contract creation, the rebate
would be provided as part of the settlement process and rebate condition would be
visible in Credit memo which will book the correct accrual amount to the respective
accounts. So there is no need to adopt the Sales order anymore.

Step: Document Settlement

8. Accruals can be posted during the SD Invoice Posting, similar to how accruals where
posted with former SD Rebate functionality. Accrual Conditions from the Condition
Contract must be included in the SD pricing procedure and maintained though the
Condition Contract.

In transaction WB2R_SC organization values are entered and simulated to check the
accrued amount & post the same to FI. (Please note that Run Type ‘Check Run’ does
not post any data) For actual settlement ‘Live Run’ is used.

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This will post all the accruals to FI and an credit note will be issued for the respective
customer.