SAP FI Dunning Procedure customization and Functionality

SAP FI Dunning Procedure customization and Functionality

1. I. INTRODUCTION

Purpose:

When the customer misses the payment for the outstanding invoice within specified payment due date. The dunning letter is generated via sap program and send at customer address for reminding the customer outstanding payment

Requirement:

The dunning system enables to trace liable customers who have not paid their open invoices within a given time span. It enables you to handle the process from, for example, sending a reminder to customers of their outstanding payments through to referring such customers to collections agencies.

The dunning system covers the following documents:

1. 1. Open A/R invoices, including invoices that are partially credited or partially paid
2. 2. Invoices that include installments
3. 3. A/R credit memos
4. 4. Incoming payments that are not based on invoices

Terminology in SAP

Dunning procedure
The dunning procedure controls how dunning is carried out by the system. You can define as many dunning procedures as you like.

Dunning level
The dunning levels are calculated based on the number of days open items are in arrears. You can also have the system calculate the dunning levels based on the dunning amount or a percentage paid (sales-related dunning level determination). Define print parameters.
You can determine more than one dunning level per dunning procedure.

Dunning area
A dunning area is an organizational unit within a company code used for the dunning process.
A dunning area can be a division or a sales organization. You assign a dunning area to an open item when making a posting. You can dun items separately by dunning area. Example South, East, West , North regions

Dunning Key

Dunning key controls the dunning levels

Customization for Dunning

1.       Create Dunning Keys

2.       Dunning Area

3.       Define Block reason for Dunning Notices

4.       Define Dunning Procedures

·         Create Dunning Interval in days to Dunning Procedures

·         Define  Dunning Levels to Dunning Procedures

·         Define  Dunning Charges to Dunning Procedures

·         Define Minimum Amounts to Dunning Procedures

·         Assign  Dunning Texts and forms  to Dunning Procedures

·         Create Smart forms or Script forms

·         Assign smart forms to dunning procedure

·         Assign Special indicator to Dunning Procedures

5.       Assign Company Code to Dunning Procedures

6.       Assign Sort Fields to Dunning Procedures

7.       Create Accounting clerk

8.       Assign dunning program role for user

9.       Activate the dunning via E-mail (To receive letter by mail)

10.    Assign dunning procedure and dunning area in customer master data

11.    Define interest calculation (if calculation indicator required)

12.    Execute dunning run for over due items F150

Create Dunning Keys: Path: IMG > Financial Accounting (New) > Account Receivable and Account Payable > Business Transactions > Dunning > Basic Setting for Dunning > Define Dunning Keys T. code: OB17

Create Dunning Area T.Code OB61

Block reason for Dunning Notices Path: IMG > Financial Accounting (New) > Account Receivable and Account Payable > Business Transactions > Dunning > Basic Setting for Dunning > Define Dunning Block Reasons T. code: OB18

Define Dunning Procedures Path: IMG > Financial Accounting (New) > Account Receivable and Account Payable > Business Transactions > Dunning > Dunning Procedure > Define Dunning Procedure FBMP

Here fill in the required details as par the requirement.

Dunning interval in Days– It is the minimum gap in number of days between consecutive dunning levels.

Number of dunning levels - Maximum of 9 dunning levels could be defined in the dunning procedure. Depending on the requirement dunning levels could be defined and dunning is restricted to the maximum  dunning level assigned in the dunning procedure.

Total due items from dunning level– It is the dunning level from which all the due items in an account needs to be totaled.

1. Min. days in arrears (acct)– Minimum days in account after which a dunning notice will be sent.

Line item grace periods– These are the number of days of grace added for doing first dunning.

Interest indicator– Calculation of dunning Interest. This indicator is used for calculating dunning interest only if interest indicator is not mentioned in the Customer Master. If interest indicator is mentioned in the Customer Master than that gets preference over this Interest indicator for calculation of Interest in dunning.

Public holiday calendar ID– It is a 2 character identifier for identifying public holiday calendar to ensure that the overdue items are not considered as due if the amount falls overdue on a weekend or public holiday.

Standard Transaction dunning– If this indicator is set, then only standard transactions are included when using this dunning procedure and not the special G/L transactions.

Dun special G/L transactions– If Special G/L transactions along with standard transactions needs to be included in the dunning procedure, then this indicator is used.

Create Dunning Interval in days to Dunning Procedures

Define  Dunning Levels to Dunning Procedures

Check the checkbox against the dunning level if interest is required to be calculated for that particular dunning notice.

Number of days specified in Payment deadline is the number of days added to the issue date of the payment run to intimate the customer/vendor about the timelines for honoring the payment. Payment deadlines can be added against each level for the payment of overdue items in the dunning notice. The number entered in this field is added to the date of issue of the dunning run

Define  Dunning Charges to Dunning Procedures

Dunning charge as per the dunning level. This is like an administration charge to dun the customer

Dunning charges can be either a fixed amount or a percentage of the dunning amount.

A minimum amount for the dunning charges can be set.

Define Minimum Amounts to Dunning Procedures

Define minimum amount or percentage of the overdue items to reach a dunning level.

Minimum amount to be reached in order to calculate interest per dunning level.

Assign  Dunning Texts and forms  to Dunning Procedures

For inserting dunning forms, click Dunning Texts and assign the required forms for the dunning text with reference to dunning Level.

Create Smart forms or Script forms

Standard SAP has provided standard smart form F150_DUNN_SF and SAP script F150_DUNN_01. For custom requirement these forms can be copied and modified as per requirement. There are advantages of using smart form over the SAP script; there is more control on managing contents of the dunning letter. For example if overdue items needs to be displayed grouped as per dunning level, Smart form is the best way.

The dunning process will be configured as per the business requirements. Once the dunning process configuration is completed, below are the steps to assign smart form to Dunning program.

Forms are three type : 1. Smart 2. Script and 3. Adobe

Creating Smart form by copying ZF150_DUNN_SF T.Code SMARTFORMS

Assign smart form processing Function Module

1. T.Code FIBF

1. T.Code BF31

Set the FM FI_PRINT_DUNNING_NOTICE_SMARTF for Business Transaction Event (BTE) "1720" with application indicator FI-FI

Assign Smart form for normal dunning procedure

Financial Accounting (New) -> Accounts Receivable And Accounts Payable  -> Business Transactions-> Dunning -> Printout -> Assign Dunning Forms

Script forms in T.Code SE71

Assigned the samrt forms in dunning text

Assign Company Code to Dunning Procedures

We have assigned company code with reference to Dunning Level and not by Dunning area

Separate dunning notice for each dunning level?

An entry in this field means that a separate dunning notice is created within an account for every dunning level determined.

Use: You establish this independent of company code. In contrast to standard dunning in which all items at all dunning levels are dunned with one dunning notice and the highest occurring dunning level determines the dunning text, when dunning by dunning level a separate dunning notice is produced per dunning level with a different accompanying text in each case. The customer/vendor can then receive several dunning notices from one dunning run.

Assign Special indicator to Dunning Procedures

Assigned Special Indicator Reserve for Bad Debt to dunning Procedure

We can take down payments into consideration during the dunning run. When defining the dunning procedure we must specify which down payment types are included in the dunning run. To do this, we specify the special G/L indicators for these down payment types. The dunning program treats a down payment received as a credit memo and reduces the receivables by the amount of the down payment. Since down payments are only included in the dunning run in exceptional cases, each down payment item contains a field for the dunning block. The system sets this block automatically. The down payment also contains a due date field, which the system automatically fills with the document date. You can change these fields with the document change function

Create Accounting clerk

OB05 OR OBVU Dunning clerk

Assign dunning program role for user

Dunning Program authorization assigned in User profile T.Code SU01

Updated dunning clerk mail id

Activate the dunning via E-mail (To receive letter by mail)

Dunning letter output can be in two forms.

1)        Email

2)        Manual Print out

If email id is updated in customer/vendor master data then the dunning letter is sent via email .If email id is not updated in the master data then the letter is to be manually printed and send. One can find it in the spool

1. T.Code SPO1

To received dunning forms through mail , Check in functional module table dunning via email active or not

Assign dunning procedure and dunning area in customer master data

Dunning clerk

Identification code for the accounting clerk dealing with dunning letters Using this identification code, the accounting clerk whose name is printed on the dunning letters is determined. Note if this field is not filled, then the entry from the Accounting clerk field is used.

Define interest calculation (if calculation indicator required)

Intercalation below is transaction code for customization

OB82- Prepare Interest on arrears calculation

OBV1- Prepare Interest on arrears calculation

OB46- Interest Calculation Types

OBAA- Prepare Account Balance Interest Calculation

OBAC- Reference Interest Rate Calculation

OB81- Define Time Based Terms

OB83-Interest Values                       

OBY2- Automatic Account Assignment Of Interest a

Execute dunning run for over due items F150

Below is the example of overdue invoice which we completed three dunning levels.

First dunning

Check customer master data

Second Dunning

Third Dunning

Dunning Form generated as given below example format.

Dunning Table

   Mhnk                  Dunning data (account entries)

   T001                    Company code information

   knb5                   Customer master dunning data

   lfb5                     Vendor master dunning data

   t047                    Company Code Dunning Control

   t047c                  Dunning charges

   t047i                   Standard texts for dunning notices

   t056z                  Interest Rates

   f150d                  Work fields for SAPF150D

   fsabe                  Accounting Clerk Address Data

   adrnr                  Address number

   adrs                    Address details

   t047b                  Dunning level control

  Mhnd                  Dunning data