Vendor Rebate FICO Configuration
Rebate Arrangement is contract that is made between the Vendor & Supplier for giving certain percentage/value of discounts by vendor on purchase over a particular value/quantity of material.
I tried to cover only FICO configuration, there are many blogs for MM configuration.
- Define Rebate Arrangement Types for Subsequent Settlement
- Document Splitting for Document Type RA
- OBYC Configuration
- Accounting Entries
Define Rebate Arrangement Types for Subsequent Settlement
Path: SPRO-Materials Management-Purchasing-Subsequent (End-of-Period Rebate) Settlement-Agreements-Define Rebate Arrangement Types for Subsequent Settlement.
Click on Agreement Type, Example 1000
Go to Settlement Tab
Settlement Type should be: Credit side settlement accounting at plant level.
Go to Credit side Settlement
Partial settlement: BM30 – Part.Set.Rebate,Plant
Final Settlement: BM10 – Fin.Set.Rebater, Plant
Partial settlement: BM31 – Part.Set.Rebate,Purchasing org
Final Settlement: BM11 – Fin.Set.Rebater, Purchasing org
Above setting can be chosen based on client requirement. Recommended is BM30 and BM10.
2. Document splitting for Document type RA
Path: SPRO-Financial Accounting (New)-General Ledger Accounting (New)-Business Transactions-Document Splitting-Classify Document Types for Document Splitting.
This configuration is mandatory derive the profit center.
Profit center derivation: If agreement type is 1000-Rebate (Vendor based Agreement) than settlement material has to assign at agreement level while creating the agreement.
System derives the profit center from settlement material master while running settlement MEB4.
The settlement Material extend to multiple plants and assign appropriate profit center in material master.
While Running settlement the the system derives the profit enter from settlement material not from you GR based profit center.
3. OBYC Configuration
Create a Balance Sheet GL Account for Rebate Accruals with reference of GR/IR Account.
Assign Rebate Accruals GL account to Transaction Key BO1.
Create a P/ L GL Account for Other Revenues.
Assign to Other revenue GL account to transaction key BO2 or Any P/L account can be assigned to transaction Key BO2.
If assigned GL Account in BO2 is cost element with category 1 than cost object is optional only in rebate settlement, It post to REO object type.
OKB9 settings does not work for BO2 transaction key.
OKC9 can work but i don’t recommend for this scenario due to OKC9 always substitute cost object.
4. Accounting Entries.
Purchase order 10Qty price 10 total value 100
Agreement if reach total order value 100 than 10% Accrual, 12% Actual.
Material Account Dr 90
Accrual Rebate account Dr 10
GR/IR Account Cr 100
GR/IR Dr 100
Vendor Cr 100
Rebate Settlement as per 12% actual (one accounting entry below 6 lines)
Rebate Accruals Cr 10
Other Revenue Dr 10
Other Revenue Dr 12
Other Revenue Cr 12
Other Revenue Cr 12
Vendor Dr 12
The inventory value is reduced and also posted rebated accruals at the of GR based rebate accrual 10% mentioned in rebate agreement. Rebate accruals knock off at the finance settlement. Other revenue account has net impact of 2 after final settlement of rebate agreement. Vendor has open item with 12 which can be adjusted with vendor payable amount or through new credit note.
SAP FICO Consultant.