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Inter-company billing process

In normal business, we may decide to source our selling products from group companies to cover excess demand, or to optimally use excess capacities of group plants. When we source our selling product from a plant of another company within the group, we can use inter-company billing and generate required documents for both selling company and supplying company.

We assign plant of other company code to designated sales area (distribution channel for inter-company sales) of our company code, and we can use standard SAP inter-company pricing for the same. Here we can specify any special prices applicable via condition types IV01 & IV02. There are condition types PI01/02 which serve as reference condition types for IV01/02.

IV01 & IV02 are used with subtotal 9 (gross value) and routine 22 (inter-company billing) as shown below.

Now, we will look at two company codes 1002 & 3000. Go to IMG–>Sales & Distribution –> Billing –> Intercompany Billing

First, we define order types for inter-company billing. Specify IV (standard billing document type) in required sales document type inVOV8.

or IMG–>Sales & Distribution –> Billing –> Intercompany Billing –> Define order types for inter-company billing

Here, I have assigned 2010 plant (company code 3000) to sales area 3031/71/00(company code 3000) for internal costing.

I have created a customer id (XD01) in 1002 and assigned the same to the sales organization of 1002. This customer id will be payer & represent 1002 for inter-company billing of plant.  IMG–>Sales & Distribution –> Billing –> IntercompanyBilling –> Define internal customer number by sales org

Customer places an order on company code 1002. 1002 decides to deliver from plant 2010 belonging to company code (3000). I have created normal sales order and saved. Inventory postings for the delivery are in plant 2010 & company code 3000. Further, two billing documents are generated with reference to the same delivery document. Document flow is as under:

First billing document created in company code 1002 and payer is customer.

Related accounting documents & excise documents can be generated as per pricing procedure with reference to respective billing documents.

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      Author's profile photo Sriram D
      Sriram D

      Hi Karuna,

       

      Its indeed good post. I would have been spellbound if this has shown how Price IV01 and PI01 are used....

       

      Anyways its a good blog to start for Intercomapny...

       

      All the Best.

       

      Cheers,

      Sriram.

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      Thank you. For your suggestion as well, Sriram,

      I will add a snip of pricing procedure.

      Author's profile photo Govind Krishna Kumar Thiagarajan
      Govind Krishna Kumar Thiagarajan

      Hi Karuna, A very good blog..keep up the good work.

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      Thanks Govind!

      Author's profile photo Former Member
      Former Member

      Good effort dear

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      Thank you

      Author's profile photo Former Member
      Former Member

      Hi Karuna, ...

       

      good effort

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      thank you Vinayaka!

      Author's profile photo Former Member
      Former Member

      Hi Karuna

       

      Too good document.

      Thanks a lot.

      one suggestion: It will be great If you add a business example for special prices applicable via condition types IV01 & IV02.

       

      Regards

       

      Atul

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      Thank you Atul, I will add an example as soon as possible!

      Author's profile photo TW Typewriter
      TW Typewriter

      Karuna,

       

      The below seems to be incorrect!

      The supplying plant 2010 should be linked with the sales organization which is assigned to company code 3000 (the supplying company code) and not with the company code 1002 (the ordering company code).

       

      By this assignment, the sales area (in the intercompany billing document) is determined.

      As intercompany bill is from the supplying / deliverying company code; thus the sales area also should be of the deliverying company code i.e. 3000 (and not 1002).

       

      Extract from the document -

      Here, I have assigned 2010 plant (company code 3000) to sales area 1002/03/00(company code 1002).

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      Hi TW,

      2010 is plant of CC3000 and I want to sell a product which is not there is my plant 3200(CC1002). So first I assign 2010 to my sales org 1002/03/00 and inturn assign this sales org as customer of 2010. So interco bill will be from CC3000 to CC1002.

      Author's profile photo TW Typewriter
      TW Typewriter

      Karuna,

       

      In this screenshot, we assign a plant to a sales area. In turn, in the intercompany billing document the system takes this sales area.

       

      The intercompany billing document is created with sales area of the delivering entity (i.e. sales area of company code 3000)

      and not the ordering sales area (not company code 1002).

       

      In  your intercompany billing document, please check the sales area. Is it correct? (i.e. of comp code 3000)

       

      The standard billing document (F2) shall be created with the sales area of comp code 1002.

       

      From your post, to make plant 2010 a delivery plant for Comp code 1002 (ordering), the sales org and distribution channel (of ordering comp code) has to be assigned to the delivering plant (2010). This is a different configuration step, than the one we are currently discussing.

       

      Kindly do some tests and update based on  your results.

      It would be a learning for all of us

      Author's profile photo Former Member
      Former Member

      Hi Karuna,

       

      Good one

       

       

      Regards

       

      Ratnamsri

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      Thank you

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      Sure TW

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      Hi TW, I have changed SA for internal costing and sales area for IC bill is that assigned to plant in CC3000.

      Author's profile photo TW Typewriter
      TW Typewriter

      Karuna,

       

      Good to know that you have made the change!

       

      This is an important configuration step in the Intercompany process.

      By this step, system determines the sales area in the Intercompany billing document.

      This billing document is the bill created by the supplying entity (which delivers the goods to the customer, on the basis of the directives of the ordering entity) and sent to the ordering entity.

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      You 're right TW !

      Author's profile photo Former Member
      Former Member

      Thanks TW, this assignment was really important and was missing in many forums

      Author's profile photo Suman Sardar
      Suman Sardar

      Nice effort Karuna.

      Keep sharing.

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      Thank You Suman

      Author's profile photo Pradeep Mani
      Pradeep Mani

      Good document..

      what will be the pricing procedure which will be followed while billing to customer.As there are condition type like IC01

      For intercompany billing ICAA01

       

      Thanks,

      Pradeep

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      Thank you Pradeep,

      You can use ICAA01 or create your own pricing procedure for inter-company billing. The whole process will use single pricing procedure, that which you assigned; or separate pricing procedures as assigned to combinations of documents & sales areas in OVKK.

      Author's profile photo Pradeep Mani
      Pradeep Mani

      The whole process will use single pricing procedure, that which you assigned;                   

      How can we use single pricing procedure for whole process (billing to customer,billing to order company code)

      Also would be useful if some explanation is made on IV01 and PI01

      Author's profile photo TW Typewriter
      TW Typewriter

      Pradeep,

       

      Your comment touches a very important and interesting part, in the intercompany sale process!

       

      In standard SAP, intercompany sale has two pricing procedures RVAA01 and ICAA01.

       

      Helpful document, read section Pricing -

      http://www.gotothings.com/sd/configuring-intercompany-billing.htm

       

      Below link, Abhee J's post -

      http://scn.sap.com/message/6786843

      Author's profile photo Pradeep Mani
      Pradeep Mani

      Thanks TW,

      Still not clear about condition types IV01 & PI01.Is it compulsory to use in our pricing procedure.What is the use of those.

      Author's profile photo Sundar S
      Sundar S

      Hi Pradeep,

       

      If you still unclear about PI01 and IV01, then the below link might help you .pls go through this .

       

      Difference between PI01 & IV01

       

      Regards

      Sundar

      Author's profile photo Former Member
      Former Member

      hi karuna

       

      good one

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      Thank you Dama

      Author's profile photo Shiva Vasireddy
      Shiva Vasireddy

      Hi Karuna,

      Thank you for sharing the Explicit Document.

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      Thank you for referring to it.

      Author's profile photo Former Member
      Former Member

      Well put, in very simple language & point vise explanation

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      Thank you

      Author's profile photo Former Member
      Former Member

      Good one .. Well done!

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      Thank you

      Author's profile photo varun yadav
      varun yadav

      This Blog give partial information on intercompany process.

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      I have posted a blog if you have noticed. I will create a wiki document on inter-company billing process in the near-future. Please be on the look out for it!

      Author's profile photo Former Member
      Former Member

      Thank`s for sharing knowledge..,

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      You're welcome!

      Author's profile photo Former Member
      Former Member

      good one  karuna .

      Author's profile photo Former Member
      Former Member

      Anyone who know I/C process is possible for non-valuated stocks like software license and service package etc?

      Author's profile photo TW Typewriter
      TW Typewriter

      Patrick,

      Are these licenses and service packages worth nothing? (in your business)

      What do you mean by non-valuated stock? Do you maintain inventory?

      TW

      Author's profile photo San Sam
      San Sam

      Good post

      Author's profile photo Former Member
      Former Member

      Thanks for the post. Would you please let me know what is the PATH for this screen:

       

      Author's profile photo Julio Cesar Quiñones Niño
      Julio Cesar Quiñones Niño

      Hi Karuma,

       

      Very Excellent document, just one question. How is the process if my process does not begin with sales order, I have my sales forecast and based on that I want to procure material from a plan in different company code, how is the Intercompany billing process, what are the transactions in both company codes?

      Thanks

       

      Author's profile photo veera v
      veera v

      Hi,

      Intercompany sales process 2 invoices has to generate. One for within company and other one for customer so for this where we can do configure the settings.

      Thanks,

      Veera

      Author's profile photo Jayanth Shettigar
      Jayanth Shettigar

      Hello Karuna,

      This is really a good post to clear the basics, can you help me on one of the requirements where Intercompany billing needs to raise to settle the Insurance claims but there is no plant involved. What steps needs to be taken and whether the"PLANT" is mandatory in this IC billling process?

      Regards

      Jayanth S