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This article introduces you how to carry out SAP SD credit risk management analysis, the content is very detailed, interested friends can refer to, hope to be helpful to you.

Overview of Credit risk Management of SAP SD basic knowledge

First, a brief introduction

In the SAP system, there is an independent function of credit / risk management, through FI and SD, the aim is to minimize the credit risk in delivery and service delivery. With credit management capabilities, we can define how to handle customers based on credit and set up systems to reflect these credit processes in related business transactions.

Automatic credit control and derived locks (resulting blocks) are part of sales and shipping, and credit representatives can use these functions to handle emergency transactions quickly and efficiently. Credit management includes the following characteristics:

According to the needs of credit management, automated credit inspection based on the diversity of criteria can be provided. We can also specify that these inspections should be carried out at those tipping points in the sales and distribution cycle.

Key credit conditions can be automatically notified to the relevant credit managers by internal e-mail.

The credit representative should be in a position where he can quickly and accurately examine the customer's credit situation and decide whether to extend the credit according to the credit policy.

Credit representative is defined here.

Second, different forms of payment guarantee Different Forms of Payment Guarantee

The SAP system provides us with a variety of options for payment guarantees for receivables, all of which are included in risk management. We can distinguish between different forms of payment guarantee according to the level of security provided.

In credit management, we can group our customers according to risk categories and set a maximum credit limit for each risk category; how we set these allocations depends on the level of credit we want to grant to customers.

We can also use the following forms of payment guarantee to reduce the risks involved in receivables:

Financial vouchers Financial document (confirmed and unconfirmed letters of credit)

Export credit insurance Export credit insurance (connect to external system)

Payment card Payment cards

For the relevant configuration, please see the following configuration path

Assign a payment guarantee policy to a sales order type

Third, the total commitment Total Commitments in Credit Management in credit management

Open order value Open order value: the open order value is the value of all outstanding order items, and the value of the outstanding order is based on the confirmed quantity (confirmed quantity multiplied by the credit price = the outstanding order value of the order). Orders that have been locked in the credit check are not included in the confirmed quantity; as long as the lock is in place, the value of the outstanding order will not increase.

Outstanding delivery value: outstanding delivery value is the value of all delivery items that have not yet been invoiced.

Outstanding invoice value: the outstanding invoice value is the value of all invoice items that have not yet been transmitted to the accountant.

Receivables from sales are included in the total commitment as long as they are not marked as disputed items. Receivables from special general ledger transactions are transferred from special obligations to total commitments if they are related to credit limits (for example, payments).

Fourth, deal with business transactions with credit management Processing Transactions With Credit Management

To use the credit management function, we must first maintain master data (for example, risk categories and credit limits) related to the credit management section of FI.

We can configure so that different checks are performed at different points in the SD process. This can be used to lock a sales order if the credit limit is exceeded. The credit representative receives a list of locked vouchers that can be checked and then released or rejected. After a locked credential is released, subsequent functions in SD can continue.

Configuration of Credit group

Credit group can be defined in three links: sales order, delivery order and delivery posting to realize the cut-in control of credit management.

Credit limit check on Delivery type

Credit limit check on sales order type

Depending on the phase of the business transaction, the system identifies changes in values that have an impact on the customer's total commitment.

Integrated Integration of Credit Management with Risk Management of Credit Management and risk Management

When using credit management, we enter a credit limit that we intend to grant to the customer; however, we still have no substantive guarantee that receivables will be paid.

The SAP system provides us with more secure forms of payment guarantee in addition to credit management, which are included in the category of risk management. If, for example, we accept payment by a customer using a credit card, then the amount subsequently authorized by the credit card is guaranteed by the company that we will receive the payment. Because the process uses a secure form of payment guarantee, it does not result in an increase in the total commitment defined in credit management.

Credit management can now be used as the second stage of risk management, which is lower than a safe form of payment guarantee. If we also grant the customer a credit limit and we receive an order that is not paid by credit card, the order increases the total commitment in credit management, in which case there is no guarantee that the payment will be executed.

On how to carry out SAP SD credit risk management analysis is shared here, I hope that the above content can be of some help to you, can learn more knowledge. If you think the article is good, you can share it for more people to see.

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