0205 the best of both worldspure down payments in a standard order

8/10/2019 0205 the Best of Both WorldsPure Down Payments in a Standard Order

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The Best of Both Worlds...Pure Down

Payments in a Standard OrderBarbara McNally and Esther Brooks, Cooper Industries

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Real Experience. Real Advantage.

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Cooper Overview

Cooper manufactures in 23 Countries, sells in ~100 and has26,000 employees worldwide. Total sales ~ 5.5 Billion




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Cooper Products

Energy and Safety




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Cooper Products Cont‟d

Electrical




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Learning Points

Pure down payment business process flow

A Milestone Billing solution which blends order-related

and delivery-related billing in one sales order document

SD, FI Configuration and Master Data steps to implement

the solution quickly




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Problem Statement

The Milestone Billing process that was currently in use atCooper required several SAP transactional documents as well

as manual journal entries

The workaround process did not leave a clearly visible audittrail and was extremely cumbersome and labor-intensive


http://slidepdf.com/reader/full/0205-the-best-of-both-worldspure-down-payments-in-a-standard-order 7/32Real Experience. Real Advantage.

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Project Objectives

An improved process and system solution to handle downpayments and milestone billing for finished goods items that

could be delivered through the standard SAP process

A Global solution that could be re-applied efficiently



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Potential Solutions

Solution options we defined…

A. Standard SAP order-related billing

B. 2-step Down Payment: Down Payment Order plus

Standard Order

C. Down Payment integrated with Standard Order



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And the solution winner is…

C. Down Payment integrated with Standard Order



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Milestone Billing Process



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Milestone Billing Plan Type & associated configuration “DownPmt Billing -value based”

Assign Milestone Billing Plan Type to “MS Bill Ord+Del” item category

Pricing Procedure

Add AZWR “Down Pay./Settlement” standard condition type toapplicable pricing procedures

Assign ABAP Pricing requirement

Exempts items with Milestone Billing item category

from mandatory list price

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Configuration - SD



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Configuration – SD – Cont‟d

Item category “MS Bill Ord+Del”

Assign to item category group

Item category group

“Down Payments”

Item Incompletion Procedure

“MS Billing”

Schedule line category

“DIEN Matl -No ATP” Assign to item category group

Schedule line incompletion procedure

“MS Billing Schedule Ln”



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Configuration – SD – Cont‟d

Billing Output New “Down Payment Request” billing output type

Copy Control

Ensure that order-related and delivery-related billing entries have setting

“B Sales Order Number” in the “Assignment” field

Verify configuration for sales and billing document types that

will be used, including copy control for new item category



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ABAP Development

Created pricing requirement which exempts items with

Milestone Billing item category from mandatory list price

Created new output program and form for “Down PaymentRequest” invoice

Modified existing billing output program and form to consider

down payments in calculation*

*Added standard SAP function module SD_DOWNPAYMENT_READ to

invoice program for delivery-related output. This function module is

not released for customer and not supported by SAP.



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Master Data

Create a down payment DIEN service material (or multiple

materials ) based on local business requirements

Assign “Down Payments” item category group to service

material in Sales Org2 View of material master

Assign MRP Type “No Planning” in DIEN material in MRP1View of material master



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Order Example – Cont‟d

Note that condition AZWR does not increase the value of

the order



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Down Payment Request Invoice

Note that AZWR condition value of $800.00 hastransferred from the billing plan in the sales order line

item



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Sales Order Document Flow



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FI Configuration

Standard customer down payment configuration for Special

GL indicators A and F (noted item).

A = Down payment, assign customer down payment

reconciliation GL „Deposits from Customers‟.

F = Down payment request. Standard configuration defined as

„noted item‟.



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GL Master

Assign sort key 036 (sales order) to the customer down

payment reconciliation GL.

The sales order populated on „assignment‟ field of the

customer OI allows the A/R Department to:

Track all A/R transactions related to the same sales order.

Visualize the actual customer order balance.



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FI Postings

The down payment creates a customer noted OI – down

payment request. This does not post to the GL.

The customer cash application can be posted manually or

through lockbox.

The payment document creates a new customer OI with SGL

ind = A.



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FI Postings Cont‟d

1. Down payment posting.

2. Invoice.

3. Balance payment (Invoice – down payment).



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FI-AR Line item display

When using a line layout with „Assignment‟ field on it, we are

able to determine current customer sales order balance.

Include SGL transactions and Noted items in customer line item

display.




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Benefits

Integrated solution that blends order-related billing (Down

Payment Request) with delivery-related billing (Standard

Invoice) using standard SAP configuration

Clean, flexible solution that works even when the down

payment needs to be requested prior to order entry of

products

Down Payment item can also be added after order has been

entered




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Benefits Cont‟d

Solution allows one or many down payments

Documents create a connected audit trail that‟s easy to

navigate for both functional areas – Sales (Document Flow) and

Finance (Customer Line Item Display)

Billing document output calculates net amount due*, after

considering down payments that the customer has made

*ABAP development will be required as SAP function module

SD_DOWNPAYMENT_READ is not released for customer and not

supported per SAP.




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Return on Investment

The "Pure" Milestone Billing solution we developed is unique in

that it is a new function within core ECC6.0, without the need

for a 3rd party solution nor activation of new functionality via

Enhancement Packs!

The SD & FI audit trail alone provides a significant savings interms of resources and effort it took to piece together the

Sales and Finance documents for internal and external auditors.




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Key Learnings

Pure down payment business process flow

A Milestone Billing solution which blends order-related and

delivery-related billing in one sales order document

SD, FI configuration and Master Data steps to implement

the solution quickly




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Caveats and Future Improvements

Restrictions

The Down payment amount in the sales order has to be calculated and

entered manually.

When creating a new billing document, it does not prompt a warning

message to inform of an existing down payment.

SAP Credit Management does not support the dynamic credit check forbilling plans of all types (OSS note 1096009)

Improvements An FI substitution user-exit needs to be implemented to populate the

sales order number from the invoice paid into the payment line item

(PK 15).




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Implementation Tips

Deployment of Milestone Billing can be done in a snap by

adding AZWR “Down Pay./Settlement” price condition to your

pricing procedure and a little master data!

Create down payment DIEN service material(s) based on local business

requirements

Assign item category group “Down Payments” to service material inSales Org2 view of material master

Assign Availability Check group to “KP No check” in (Sales:

General/Plant view)

Create billing output condition record for “Down Payment Request”

No formal training required, just few tips and instructions

provided




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References

SAP Notes we consulted:

528608 – Sales document with „pure‟ down payment items (new)

213526 – Customizing of down payment processing SD/FI

213567 – Analysis of the down payments in SD

304408 – Enhancement of billing document printout: Down

payments (1)

532052 – Values for down payments missing in billing document

printout

1096009 – Restrictions in SAP Credit Management



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0205 The Best of Both Worlds…Pure Down Payments ina Standard Order

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