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Author's profile photo Kee Seng (John) CHIN

Offseting between vendor and customer balance via F110


If a vendor is also a customer, from the perspective of making vendor payment, it is possible to offset the outgoing payment amount from the existing amount owed to the customer when running the F110 – Automatic Payment Run.

Prerequisite settings in vendor/customer master

Vendor Master

1 Input Customer Information in Vendor Master

  1. The customer number is used by the payment and dunning programs for clearing open items. For line item display, the link to the customer line items is established using this number.


     If you require clearing between the customer and vendor, the following requirements must be met:

     –  The customer number must have been entered in the corresponding vendor master record.

     –  The vendor number must have been entered in the corresponding customer master record which we will do in the next step.

     –  The fields “Clrg with vend.” or “Clrg with cust.” must have been selected in both master records.

     2. For clearing with customer setting, the screen is as shown below. As for clearing with vendor setting will cover in next step.

When you try to activate the ‘Clrg with cust.’ Indicator, SAP displays the follow message where the ‘clearing account 10201734’ is the customer number.

Customer master

2 Input Vendor Information in Customer Master

    1. Specifies an alphanumeric key that uniquely identifies the vendor or creditor in the SAP system.

     2. Then turn on the ‘Clearing with vendor’ indicator in order to complete the settings in respective master in order to allow clearing with customer during

          automatic payment process.

Clearing between vendor and customer via F110

1 Analyse Vendor and Customer Balance

  1. Analyse the open item balance for vendor, that the total amount outstanding on vendor side must be greater than the balance outstanding on customer side. This is required in order for clearing with customer to work.

         Vendor Open item

Please take note, the item with debit balance where the document number is 620004610 as shown above, should be excluded from automatic payment in the parameter set up (shown in next step) as SAP throws out error during payment run.

     2. Check the outstanding balance on the customer side where the amount is 2,200 very much less than the vendor outstanding amount.

          Customer Open Item

     3. Together with the settings both in vendor and customer master we discussed previously being fulfilled then we can proceed to next step for payment           settlement between the vendor and customer.

2 Automatic Payment Settings and Payment Run

      1. In the F110 (Automatic Outgoing Payment) parameter settings as shown below, both vendor and customer must be input in order to do offsetting payment           between a vendor and customer. Both vendor and customer numbers must be entered besides other settings.

     2. The result of payment proposal list shows the amount details of all open items from vendor and corresponding customer highlighted in red colour box.

     3. Display payment proposal job log

     4. Display payment job log

     5. Actual document posted

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      Author's profile photo Bohdan Petrushchak
      Bohdan Petrushchak

      Hello Kee Seng,

      Thanks for an interesting guide on offsetting between vendor and customer accounts.

      I would like to note that you should also add the following small remark concerning the business scenario described above.

      As far as I understood, you use APP in order to post payments (not to generate payment orders). In this case, document type specified in configuration of payment method ("Document type for payment" in "Payment methods for Country") should allow postings to both customer and vendor accounts. Otherwise, you'll encounter errors during APP run.

      On the other hand, if somebody would like to use this scenario for generation of payment orders, the document type specified in settings of the posting rule for outgoing payments ("Global Settings for Electronic Bank Statement -> Define Posting Rules") should also allow postings to both account types - vendors and customers.

      Best regards,

      The Wirtschaftsmann

      Author's profile photo Yasmin Khan
      Yasmin Khan

      Hi, This was a nice blog. We have the same requirement to perform the netting. Have done the same settings, but the amounts are not netting off. The proposal is creating the 2 separate documents for customers and vendors individually. What else, do you think it is missing?

      Author's profile photo Olga Ageeva
      Olga Ageeva

      And for me too… Do you know the solution? @

      Author's profile photo Vamshi Vemula
      Vamshi Vemula

      It never works for me, did you find a solution? Cust net balance is less than vendor balance. both has same payment methods, clear with vendor/cust checked, updated cust in vendor master and vice versa. still it creates no netting. even though I have tow payment methods one for vendor and one for customer it still use same vendor payment method on customer line. i know it is old bog. just trying to get some response on how to deal with it.



      Vamshi K

      Author's profile photo Aldana Rolon
      Aldana Rolon

      Did you Find a Solution?, I have the same problem.