Wednesday 27 April 2016

SAP SD

Credit Management

Purpose

  • Outstanding or Un collectible receivables can spoil the success of the company greatly. 
  • Credit Management enables you to minimize the credit risk yourself by specifying a specific credit limit for your customers. 
  • Thus you can take the financial pulse of a customer or group of customers, identify early warning signs, and enhance your credit-related decision-making. 
  • This is particularly useful if your customers are in financially unstable industries or companies, or if you conduct business with countries that are politically unstable or that employ a restrictive exchange rate policy.

Integration

  • If you are using the Accounts Receivable (FI-AR) component to manage your accounting and an external system for sales processing, Credit Management enables you to issue a credit limit for each customer. 
  • Every time you post an invoice (created in FI-AR), the system then checks whether the invoice amount exceeds the credit limit. 
  • Information functions such as the sales summary or early warning list help you to monitor the customer’s credit situation.
  • If you are using both the Accounts Receivable (FI-AR) component to manage your accounting and the Sales and Distribution (SD) component for sales processing, you can also use Credit Management to issue credit limits for your customers. 
  • You can make settings in Customizing to decide the scope of the check and at what stage in the process (for example, order entry, delivery or goods issue) a credit limit should take place. 
  • General information functions are also available for use with credit checks.

Features

If you are using both the SD and FI-AR components, Credit Management includes the following features:
  • Depending on your credit management needs, you can specify your own automatic credit checks based on a variety of criteria. You can also specify at which critical points in the sales and distribution cycle (for example, order entry, delivery, goods issue) the system carries out these checks.
  • During order processing, the credit representative automatically receives information about a customer’s critical credit situation.
  • Critical credit situations can also be automatically communicated to credit management personnel through internal electronic mail.
  • Your credit representatives are in a position to review the credit situation of a customer quickly and accurately and, according to your credit policy, decide whether or not to extend credit.
  • You can also work with Credit Management in distributed systems; for example if you were using centralized Financial Accounting and decentralized SD on several sales computers.

1 comment:

  1. Hi,Thanks for helping me with the informative post about Credit Management of SAP SD as it providing info all about Purpose,Integration and Features of Credit Management in SAP SD.Visit now SAP SD Online Training in Hyderabad if you are looking to learn SAP SD skills.

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