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Two birds – one stone

Everyone likes it when one action solves two problems or issues. This blog will look at a common issue within Finance and how a parallel activity can resolve the issue.


 Cash Management – part of the core SAP Financials solution for a long time now can be overlooked by clients, due to the perceived accuracy of forecasting when customer cash will be received. Analysis can be done to work out when in the chase cycle a customer is most likely to pay and therefore this can be linked into Cash Management by linking into a planning level (an indicator within Cash Management to group data). This assumes that a customer will pay all of their outstanding invoices. However in the real world customers will occasionally have issues with invoices and not pay the full amount that is due.  Historically this would have been managed via some form of excel spreadsheet to record customer queries and disputes. Having an offline dispute management system and an online cash management system makes the accuracy of the standard Cash Management reporting weak or involves a high volume of manual changes within Cash Management to produce more accurate reporting.


Within some of the recent enhancements to SAP FSCM within Dispute Management is the ability to update standard Finance fields based on the status of a customer dispute. A simple example of this could be a rule that all disputes raised change the planning level to a new specific level to indicate that the invoice is in dispute. This will then be seen in the Cash Management report to indicate that whilst those invoices are due for payment, payment is not expected and therefore can be ignored from the basic Cash Management report. Within the lifecycle of a dispute the status reflects the current position of the dispute. You could have a status of “in progress” or “passed to sales”. Within these Dispute Statuses it is clear that the dispute is still open and therefore the planning level should remain the same. However you may also have other statuses such as “Rejected”, “Credit Created” or “Resolved”. Whilst these do not close the dispute, the status would indicate that the invoices within the dispute have been resolved and therefore it is assumed the customer would now be paying the invoices that were in dispute. Within FSCM configuration you can set rules to change the planning level back to an active level so this is now visible within Cash Management and the user of the report will assume that payment is pending.

For a client to benefit from the benefits mentioned above, you will need to activate Dispute Management as well as Cash Management. By activating each module there are a number of other benefits, however by implementing both together there are further benefits that are not achievable if only one module or solution is activated.

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