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Hi ,

This below info explains in detail about, How do you handle vendor installment payment terms in SAP R/3.

It would be very helpful for both MM/FICO Consultants.

Installment payment terms

1        VENDOR PAYMENTS IN INSTALLMENTS

2        INSTALLMENT PAYMENTS

2.1          CREATE MAIN TERM

2.2          CREATE INSTALLMENT TERMS

2.3          DEFINE INSTALLMENTS

2.4          ENTER THE NEW PAYMENT TERM IN THE VENDOR MASTER

2.5          TEST HOW THE PAYMENT TERM WORKS

3        AMOUNT SPLIT

3.1          TEST THE AMOUNT SPLIT


1    Vendor payments in installments

You want to make vendor payments in installments. How do you handle this in SAP R/3?

You have two alternatives:

1.  Use installment payment terms

2.  Activate document split

Of course you can also use partial payments or residual items, but these have nothing to do with payment terms.

2    Installment payments

Instead of entering several line items, you only enter the data for one item. The breakdown is carried out by the system automatically by means of the payment terms.

Configuration

IMG Menu

Financial Accounting Accounts Receivable and Accounts Payable Business Transactions Incoming invoices/Credit Memos Maintain Terms of Payment

Transaction

Code

OBB8

or SM30 (Customizing Object V_T052)

You need to create four payment terms. First you create the ‘main term’ for the Installment. Here R001. This payment term is set to vendor master.

The Installments need also payments terms. Here you set the day limits for payments.

In IMG activity Define Terms of Payment for Installment payments you define the percentages and assign the Installment payment to the ‘main term’.

2.1    Create ‘main term’


Press New entries

Field name

Description

Payment terms

R001

Sales Text

  1. Inst. pymnt terms 3 part. amnt

Account type: Customer

Selected

Account type: Vendor

Selected

Default for baseline date:

Document Date

Payment terms: Installment payment

Selected

 

  Choose   Save.

  Choose Back.

2.2    Create ‘Installment terms’

Press ‘New entries’

Field name

Description

Description

Description

Payment terms

ZR01

ZR02

ZR03

Sales Text

1st installment

R001 (15 days)

2nd installment

R001 (30 days)

3rd installment

R001 (45 days)

Account type: Customer

Selected

Selected

Selected

Account type: Vendor

Selected

Selected

Selected

Default for baseline date

Document Date

Document Date

Document Date

Payment terms: Installment payment

Not selected

Not selected

Not selected

Payment terms: No. of days

15

30

45

 

  Choose   Save. 

Choose Back

2.3    Define Installments

IMG Menu

Financial Accounting Accounts Receivable and Accounts Payable Business Transactions Incoming invoices/Credit Memos Define Terms of Payment for Installment payments

Transaction

Code

OBB9

or SM30 (Customizing Object V_T052)

2.4    Enter the new payment term in the vendor master.

Ensure that the key is entered in the vendor master record which represents the specified terms of Payment.

2.5 Test How the Payment term Works

Create vendor invoice with transaction FB60. For offsetting posting use account 476000 Office supplies and cost center 1000. Use tax code V0.

Simulate and Post


 

                  

   

   

 

2.5    Test how the payment term works

Create vendor invoice with transaction FB60.

For offsetting posting use account 476000 Office supplies and cost center 1000. Use tax code V0.

Add the net due date to the layout (    ) or from menu Settings / Layout / Current. You can see that the invoice is divided in three Installments with their own due dates. Save the document.

3    Amount split

If you have fixed Installments, you can use the Installment payment terms. However, if you need to change the amounts, this is not a good solution. Any change in Installment payment terms or invoice plans requires additional customizing. There is a way to use flexible amounts in the Installments. Enable Amount Split in the company code customizing.


Amount split enables the split of an invoice or credit memo final amount. A new tab Amount split will appear on the screens of the Enjoy transactions (FB60, MIRO). This method does not work for the old style transactions such as FB01.)

3.1    Test the amount split

Create a new invoice for vendor 200 (payment terms R001 in vendor master). Open tab Amount split.

You can split the amount according to payment method or terms of payment. If you have entered a payment method, this entry has priority over the payment method in the terms of payment.


If no split is made Installments according to payment term.

Make following split: 15000 is paid immediately (payment term 0001) and the rest with payment term ZR02.

Simulate the document and Post

Thanks,

With Best Regards,

Prabhakar Rao

Senior Consultant SAP MM

HITACHI CONSULTING

                

   

   

  

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