Availability Check // Credit management

Availability CheckHow the availability check is carried out is influenced by various factors. Among other things, these factors also determine the scope of the check. The scope of the check can be defined differently in the sales documents and in the deliveries. You can also specify whether the availability check takes replenishment lead time into account.The following elements can be included in the availability check:• Stocko safety stock o stock in transfer o quality inspection o blocked stock• Inward/Outward movement of goodso purchase orders o purchase requisitions o planned orders o production orders o reservations o dependent reservations o dependent requirements o sales requirements o delivery requirementsRequirements in sales and distribution (sales requirements and delivery requirements) result from all transactions which forward a requirement to Materials Management (MM) or to Production Planning (PP). For example, this could include sales orders or deliveries and quotations as well. Sales and distribution requirements reduce existing stock or inward movements of stock on the material availability date to ensure that other outward movement of stock elements cannot access the quantity reserved in this way.Requirements relevant for Sales and distribution are created in Sales and Distribution, whereas other elements in this list are created in Materials Management or in Production Planning.For further information on transfer of requirements, see Requirements in Sales and Distribution Processing.Defining the Elements to be Included in CheckA checking rule is assigned to each transaction. This rule in combination with the checking group controls the scope of the availability check. You can use the checking rules in Customizing for Sales to specify for the various transactions which of the elements listed above should be included in the availability check.For trading goods it does not make sense to include planned or production orders, for example, in the availability check. However, for products manufactured by your company these orders should be included in the check.For transactions such as make-to-order production, consignment or returnable packaging processing that create special stock, the availability check is performed against special stock.If it is defined by the checking rules that both sales and delivery requirements are taken into account in the availability check in sales documents but only delivery requirements are taken into account in the availability check in deliveries, there is a danger that quantities reserved in the sales documents are considered to be available by the availability check in the deliveries. This can lead to sales documents becoming backlogged.Depending upon the IMG setting system carries out availability check function based on 3 methods:A) Availability Check with ATP logic or against planning:In ATP logic systems ATP Qty while carrying out availability check function for Particular line item (ATP qty=warehouse stock +planned receipts -planned issues) Planned Receipts: EX: - purchase requisitions, purchase orders, stock in transfer stock at inspection etc. Planned Issues: - EX: - open sales order & open deliversB) Availability check against product allocation:Availability check can be carried out against product allocations in which system automatically restrict the user to confirm the quantity beyond reserved quantities per particular customer. EX:- Availability qty =100, existing orders=10,then system automatically distributes to items evenly to the sales order.C) Rule based Availability check:Rule based availability check can be carried out based on the business transaction.EX: - For normal sales order system has to carry out availability check for special sales order ex: - cash sales and rush order systems need not to be carry out availability check,In rule based availability check system in which system carried out Global availability to promise in all plants. In this check system transfers the requirements to APO system where GATP takes place and the result of the availability check transferred to R/3 system. This process takes place with the transaction code CIF(central inter face) inR/3.After carrying out availability check function system proposes(by using ATP logic) default values of ATP check result to the user in a dialog box, in which system gives the choice to the user to take the decision in contest of insufficient stock.a) One time delivery: If the user chooses one time delivery and the order Quantity is 100 units system confirms 50 units then systems automatically confirms as a zero. If the user saves the document with the zero confirm qty then system trace the sales order as aback order (V_RA), which can be confirmed later by RESCHEDULLING (V_V2).b) Complete Delivery: If order Qty=100, Availability stock = 50, system says that remaining can be given after one week. Then if the user selects this option then system push up existing confirmed qty to after one week and the total qty can be confirmed after one week only.c) Delivery Proposal:If order qty=100, system confirms 50, and remaining 50 can be confirmed after one week. If the user chooses this option then system confirms 50 Qty today allows the user to delivery 50 quantities today remaining 50 can be delivered after one week.
Availability check:Configuration setting:-Availability check with ATP logic or against planning:-Define checking group:Checking group define what kind of requirement record system use to create when sales order & deliveries are processed for this material. We can create 2 kinds of requirements recordsIndividual requirement records: that means system creates requirement record for each S&D document.Summarized requirement Records: That means system creates requirement records under certain condition in the material master record. There are 2 type of summarized requirement record:Summarized requirement records for each day.Summarized requirement records for each weekDefine checking Action;Here we define 01- daily requirement -B 02- Individual requirements -AWhere b-total record per dayA-single record per dayB) Define material Block for other users:When 2 users tries to confirm the quantities for the sales order for same material at a time system will be confused to confirm the quantities both sales orders. So has to avoid this kind of situation we can block the materials from confirming the quantities for 2 users at a check, check blockC) Define checking group default values:Checking group is going to be determined depending upon the material type & plant.-Go to new entries, specify material type, ex;-FERT& plant = checking group of availability check: 02D) Carry out for Availability check:Here we define checking rule for the Availability check & allocate them to the checking group. The checking rules specify the scope of the availability check. For a respective transaction, means which planned receipts & planned issues systems has to taken into consideration and also it determines whether system has to take RLT into consideration.Action:*Select checking group of availability check-02, checking rule=01*Go to details icon, & check which planned receipts & planned issues system has taken into consideration for availability check*save it, exit.E) Define procedure by Requirement class:Here we define requirement class whether on availability check & TOR should be carried out the setting that we carries out at requirement class level they are at global level. There settings automatically copied into define from of requirement class and vice versa.Action:*Choose requirement class: 041 & check availability check & TOR (requirement)
F) Define procedure for each schedule line category:Here we carry out fine tuning setting for availability check at schedule line category level. Here we define whether system has to carry out Availability check for particular transaction.Ex:- if we want to implement a availability check w/o TOR for a particular transaction. According to settings at requirement class level TOR & availability check function activate & those setting will be copied into the schedule time category by default, so that at schedule line category level we deactivated TORG) Determine procedure for each Delivery Item category:Here we switch on or switch off availability check functions of a delivery item category*choose item category ‘TAN’. & specify the appropriate value.H) Checking group for updating back orders:Here we assign checking group to a plant that rule specifies for individual application, according to which the availability check is carried out; I) Define Default settings:Here we define the result of the availability check.*Choose your sales Area, & check fixed dates& Qty options & specify ‘D’ or ‘E’Where: D- Dialog box in the case of shortages (one time delivery)E- Dialog box in the shortages (delivery proposal).
CREDIT MANAGEMENTIn normal business process, credit sales are most important. Each and every customer purchases the material on credit basis. When the business grants materials on the basis of the credit then there should be certain limit for the credit, otherwise business incurs loss if customer not paid back. so has to avoid this kind of situation SAP provided a tool called credit management/Risk management by which the business can monitor the credit policy of the customer. To look after the credit policy of the customer, one organizational unit can be defined and maintained in FI module and whose responsibility is to grant and to monitor credit of the customer that is called CREDIT CONTROL AREA.(1) CREDIT CONTROL AREA:It is an independent organizational unit which is responsible to grant and to monitor the credit. Credit control area can be defined for a single company code or it can be defined to number of company codes. that means one credit control area can have number of company codes.Path: img-ent.structure-definition-financial accounting-define credit control areaChoose existing one, copy, rename itCurrency: assign the currency of the credit control areaUpdate: Ex. 000012 it is the update for open orders/delivery/billing document values. it controls when the open sales orders, deliveries and billing documents are updated. the following update groups can be assigned for updating credit related statistics in S & D.1) Update group 000012: if we assign this update group for credit control area then the documents are updated like below:a) sales orders: it increases open order value from delivery relevant schedule lines.b) delivery document: it reduces open order values and increases open delivery valuec) billing documents: it reduces open delivery value and increases open billing document value.d) Financial accounting document: it reduces open billing document value and increases open items.2) Update group 000015: a) Delivery document: it increases open delivery value and in increases open billing document value.b) financial accounting document: it reduces open billing document value and increases open items.3) Update group 000018:a) Sales orders: it increases open delivery value b) Billing document: it reduces open delivery value and increases open billing document valuec) Financial accounting document: reduces open billing document value and increases open itemsIf system unable to update the document with specified update group then it will go to next possible update group.ex: if we assign update group 000012, which is in delivery document reduces open order value and increases open delivery value. If in the sales order some items are not relevant for delivery then system automatically determines update group 000018.Fiscal year variant: ex: K4Default data for automatically creating new customers:If maintain the values in any one of the fields then system automatically creates credit control area date for new customers by default.a) Risk Category: ex: 001b) Credit limit: maintain amount (specify the credit limit of the customer)c) Representative group: ex:001assign credit representative group who is responsible to monitor the credit of customer.□Check all company codes: It specify that this credit control area is eligible for all the company codes. save it.(2) Assign company code to credit control areaassign companyfinancial accountingassignmentEnt. structurePath: Img code to credit control area.choose our company code from position button and assign our credit control area.save it(3) assign sales area to credit control areaPath: imgructure—assignment—sd—assign sales are to credit control area choose our sales area and assign credit control area(due to this assignment the credit limit will be apples for all the materials that belongs to different divisions), save it &exit.Define groups: (FI-CO settings)here we assign groups and assign this groups to customer.img—financial accounting—accounts receivables and accounts payable—credit management-credit control account define groups.Go to new entries and define credit groups and assign this group to credit control area .Define Risk Categories:(FI-CO settings)Here we define risk categories for the credit control area and assign the risk category to the customer Path: same as abovedefine risk categoriesgo to new entries and define risk categories , 001-high risk,002-medium risk,003-low riskAssign to credit control areasDefine credit representative groups:It is a user group for particular credit control area and we assign each customer to a customer group.Path: same as aboveGo to new entries, define credit representative group and assign it to credit control area ,save it & exit.Define Credit Representatives:Here we allocate credit representatives to credit representative group for credit control, each credit representative group is responsible for certain number of customersWe define one partner function for each credit representative group.ex: partner function KB , Partner type PEpath: same as abovecred.re.gr. CCA partner function partner counter co. code personnel no. nameID.no001 1000 kb checkCredit ManagementTypes of credit checkThe following types of credit checks can be carried out:Static credit limit checkCredit allocation depends on the total value of open orders, deliveries, billing documents and open items.Dynamic credit limit checkThe dynamic check includes both a static part which checks all open items, deliveries and billing documents and a dynamic part which checks all outstanding order values, that is, all orders not yet delivered or partially delivered. The value resulting from the checks is accumulated up to the shipping date in the information structure "S066" in freely definable time units or periods (day, week, month). This information structure is entered in Logistics Controlling and described in the section "Carry out default settings for credit management" under Basic functions.To define the credit check, you specify a certain number of relevant periods from which a date in the future can be calculated (for example, 10 days or 2 months depending on the selected period). This ensures that sales orders which lie further in the future are not used to determine the credit exposure.The total of the static and dynamic part of the check must not exceed the granted credit limit.Credit check on the basis of the maximum document valueThe sales order value or the value of goods to be delivered must not exceed a certain value defined for the credit check. The value is stored in the currency of the credit control area. In particular, this check is useful if the credit limit of new customers has not yet been specified. This check can be accessed explicitly by a risk class reserved for new customers.Credit check when changing critical fieldsThe credit check is started when changes are made to credit-relevant document fields so that they differ from the default values proposed from the customer master record (terms of payment, value days and fixed value date).Credit check at the time of the next internal checkThe credit check is started automatically on a certain date. All sales orders entered up to this time are regarded as not critical.Credit check on the basis of overdue open itemsThe ratio between open items, which are overdue by more than a certain number of days, and the customer balance must not exceed a certain percentage.Credit check on the basis of the oldest open itemsThe oldest open item may only be a certain number of days overdue.Credit check against maximum allowed dunning levelsThe dunning level of the customer may only assume a certain maximum value.Customer-specific credit checksIf you require further checks to those defined in the standard system, you can define them in the corresponding user exits (LVKMPTZZ and LVKMPFZ1).RequirementsIn the No Check field, you can enter the number of a requirement with which you can control when credit checks are not carried out. You can deactivate some or all checks. This allows fine tuning on an individual basis for defining credit-relevant transactions and when credit checks do not need to be carried out.You can also reset the credit document status. Requirements are stored as routines. For further information on routines, see the IMG of SD under Routines. The two following example routines are supplied in the standard system. You can display and edit them using transaction VOFM:1 Order2 DeliveryYou can copy and change these routines according to your own requirements. The routines contain different example scenarios in which credit checks would not be carried out.
ransaction OB38Check which credit control area is assigned to the company code.Company code:Credit control area:2. Transaction OVFLCheck which credit control area is assigned to the sales area.Sales area:Credit control area:3. Transaction XD02 or VD02Check which credit control area is assigned to the payer.Payer:Credit control area:4. Transaction SE37Is user exit EXIT_SAPFV45K_001 being used?5. Transaction OBZKFor the settings under items 2 - 4, field "All company codes" must be marked in Transaction OB45, or the credit control area must be entered under the relevant company code in table T001CM of the credit control areas allowed.Company code:Credit control areas allowed:6. Settings for the credit checks7. Transaction OVAKWhich settings do exist for the sales document type used?Sales document:Check credit:Credit group:8. Transaction OVADWhich settings do exist for the delivery type used?Delivery type:Credit group for delivery:Credit group for goods issue:9. Transaction OB01Credit management/Change risk categoryDefinition of the risk category for each credit control area. You canuse Transaction FD32 to assign this risk category to a credit account.10. Transaction OVA8Here, the individual credit checks for key fieldscredit control arearisk categorycredit groupare set. Take these key fields from the above settings and go to the detail screen. In particular, check whether fields "Reaction" and "Status/block" are set correctly. To carry out follow-up actions in case of a credit block, the credit check status must be set (field "Status/block").11. Transaction FD32Credit master data for the payer of the relevant document.Credit account:Credit limit:Risk category:Currency:12. Settings for updating the credit valuesUpdate of the credit values is required for the limit check (static or dynamic credit limit check).13. You want the item to be relevant for billing. If an item is notrelevant for billing or for pro forma billing, no update occurs.14. Transaction OVA7Update of the credit value is active for the corresponding item type if the check box is marked. This field corresponds to field "Active receivable" in Transaction VOV7.Item type:Active receivable:15. Transaction V/08, PricingIn the pricing procedure used for pricing, subtotal "A" must be entered in a line for determining the credit value (mark the pricing procedure and doubleclick on "Control"). Usually, the net value plus taxes is used. This way the system is determined to use this subtotal for credit pricing. The credit price is stored in field VBAP-CMPRE and used for update and credit check.You can find the used pricing procedure of the order under "Item -> Condition -> Analysis".Pricing procedure:Line with subtotal = 'A':
16. Transaction OB45Which update group (field "Update") do you use in the relevant credit control area? The default setting is "12". If you use another update group, check whether this is fine with you. Credit control area:Update:17. Transaction OMO1Which kind of update did you choose for structure S066? In any case, "Synchronous update (1)" has to be chosen as the kind of update. All other settings will lead to errors.
MAINTAIN MASTER DATA (FD32)SPATH: Logistics & FD32 Credit management Master data D Change.While defining credit control area the FI/CO consultants they maintain this values in the field like credit group, credit limit & checking group, risk category.System automatically creates credit master for new customers. In credit master we maintain data as well as system also updates certain data.specify customer number, credit control area,check overview, check address, check control data, check status, check payments.Overview: System gives the overview of the customers credit history .Ex: what is the credit limit, credit exposure dunning levels etcAddress: System gets the address from the customer masterControl data:
specify the total limit(total credit limit)
specify the individual limit at the company code level Currency: INRStatus : total company cod In this screen system shows the data like credit limit and how much credit limit used what is the receivables value, sales value, customer risk category and customer credit group.Payment history:In this screen system shows the payment history of the customer-payer if he paid any amount. system updates this screen with payment details due to the indicator that we check in cocode data section of customer master in payment transaction tab ‘check payment history’, save it.AUTOMATIC CREDITY CONTROL:(OVA8)basicsd Path: img credit management.credit management/risk managementfunctionsDefine automatic credit control:
Go to new entries,
specify credit control area, risk category and credit group Document controlling (first section)--No credit check: we can specify the routine for credit control area Ex: when system should not carry out credit check for sales document which doesn’t contain line itemscheck item check: this control specifies from where system has to carry out credit check in document. ex: as soon as the user enter the customer number in the sales order or enter the material numberReleased documents are still unchecked:Deviation in percentage: It specify the deviation factor for documents that have already been approved for the credit. ex: if u specify deviation factor 10% & order for 10 boxes & the price Rs. 100/- and the credit approved for the Rs. 1000/-, then customer wants additional boxes te deviation factor exceeds 10%, then system automatically carries out credit check again.Number of days: specify the number of days after which a changed document must be rechecked for the period. It is used for credit document that have already been released by credit representative but if they have subsequently changed then system doesn’t carry out another credit check, ifa) the value of the changed order is not greater than the value already approved for the credit .b) the current date is not greater than the original release date plus number of days that we specified here.Credit limit seasonal factor(percentage):specify a percentage tolerance for this limit upto which the customers credit limit may be temporarily extended or reduced ex: if us enter 5% her and if u select minus fixed then if the customer credit limit is 10,000 and it is extended by further 500/-.From & To: specify the dates by which the plants have to confirm the quantities. It is used for promotions.check in financial accounting:check-payer: It indicates the credit checks against open items, oldest open item and dunning level are carried out using the open items and the dunning level of only with current payer. system doesn’t take other payers who are assigned to this credit area.Permitted days and permitted hours: It specifies the time period for accounts receivables summery in days & hours. System uses this value to verify whether the data in the accounts receivables summary exceed the period that we set in days & hours.CHECKS (NEXT SECTION)reaction status/block  STASTIC    OPEN ORDER  OPEN DELIVERY DYNAMIC   HORIZON   DOCUMENT VALUE   MAX.DOC. VAL. 500.000.00 CREDIT FIELDS    NEXTREVENEWDATA  NUMBER OF DAYS  OPEN ITEM   MAX.OPEN ITEM%  OLDEST OPEN ITEM   DAYS OLDEST ITEM  HIGH DUNN. LEVEL   HIGH DUNNING.L  USER 1   USER 2   USER 3  
STASTIC:-System takes open sales document, delivery, billing document, open items into consideration to carry at credit check. System gets the credit exposure with the total value document and customers credits unit. If the credit limited exceeded this system reacts according to value that we get in reaction fields
DYNAMIC:-In dynamic credit check system gets the credit exposure the static part. But the difference between static &dynamic is, dynamic check contains horizon period ex 2 month. To evaluation the credit check system takes for the open items, open orders, open delivery into consideration that falls below the 2 month. system doesn’t take those document that fells ofter 2 months.DOCUMENT VALUE:-In case credit check should be carried out based on the max.document value. It is relevant for new customer to when credit limit has not been defined.CRITICAL FIELDS:-Payment terms ,fixed value date, additional value dates are considered as a critical fields. If the data has been changes in those fields system has to carry out credit check. NEXT REVIEW DATA:-System automatically carry out credit check based on the next review date.OPEN ITEMS:-System carries out credit check, based on the open items. system takes the maximum percentage of over due items in open items and number of days when the open items are over due.OLDEST OPEN ITEM:-It indicates to carry our credit check based on the age of the oldest open item.HIGHEST DUNNING LEVEL:-System carryout credit check based on the higher dunning level.USER1,USER2,USER3:-These check can be used for customer specific credit check by using user exist save it.●Go to VOV8, & make sure that credit limited check should be ‘D’ automatic.●Go to VAO! & raise the sales order. check the dynamic credit check static & save the document.●System block the sales document for delivery then release it by using transaction codes VKM5..