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Contract accounts receivable and payable (FI-CA) is a type of subledger accounting that is tailored towards the requirements of industry sectors with multiple business partners and a large number of documents for processing. To meet these demands, FI-CA offers highly automated standard processes - specialist mechanisms to guarantee outstanding system performance and optimized scalability. It also contains a range of functions for managing processes that are particular to Industry Solutions. FI-CA is suitable for worldwide implementation. It covers various statutory requirements (such as those that relate to tax legislation and accounting principles) and country-specific processes (such as the management of payment transactions).

Document Principle
Postings are always saved in document format. The document is a statement for each business transaction. Documents can only be posted if the balance of the items they contain is zero. A document consists of a document header and various document items:
The document header contains data that applies to all document items such as the document number, document date, posting date, and document type. The document type classifies documents depending on which transaction they belong to (for example, a payment from a collection agency, or a customer payment).

Figure 1: Document Principle in FI-CA

 Business partner items contain a reference to the business partner and all data that is relevant to payment transactions and dunning. They also contain the receivables or payables account that was posted to the debit or credit side. Receivables to business partners are also known as receivables lines.
Revenue items contain data for profit and loss accounting and sales tax information.
G/L account items contain the G/L account that is relevant to the posting transaction (such as the cash receipts account or tax account)
The following item types exist in contract accounts receivable and payable:
Open items
Cleared items
Statistical items
Open items are receivables that have not yet been cleared. For example, an invoice item is managed as an open item until it has been paid in full and therefore cleared. The system records a partial clearing for a partial payment.
In addition to documents that are updated in the general ledger, you can enter statistical documents. These are simply recorded in the subledger. They are used to enter noted items for budget billing requests or dunning charges.

 Account Determination
Each posting in FI-CA is defined by a business transaction that consists of a main transaction and a sub transaction. The system uses business transactions in conjunction with additional account assignment characteristics (such as the company code and the division) to determine the relevant G/L and revenue accounts and the corresponding credit/debit indicators automatically.
Examples of business transactions include receivables from consumption billing, charges from bank returns, and other credit memos.

 Business Blocks
The Contract Accounts Receivable and Payable component in mySAP Utilities supports extensive automation of your business process. However, there are situations in which this is undesirable or where automatic processing should be suspended. The system provides a range of blocking options for these cases:
Dunning block
Payment block (for incoming and outgoing payments)
Interest block
Clearing block
Posting block
 Blocks can be set manually or by triggering processes. In the case of bank returns, a contract account can be blocked for bank collection for a defined period. This allows you to gather the facts of the situation, which can be clarified with the customer.
You can also block collection to provide the customer with written information on the next collection. Blocks can be restricted to a specific period and can refer either to the entire contract account or simply to selected documents. The system records the user who has set the block, which is shown in the blocking history.

 Enhancement Concept
FI-CA offers maximum flexibility for adjustments to meet your specific requirements. The system has been designed so that customer-specific enhancements can be made to standard functions that are retained in the event of an upgrade.

 Interface Concept
FI-CA works in conjunction with invoicing in mySAP Utilities, which ensures that the automatic transfer of the corresponding postings in FI-CA is possible. Postings from the sales and distribution component (SD) can be transferred to FI-CA.
FI-CA can also be used to transfer data from external systems. An intermediate document (IDoc) interface is available for mass data transfer. This is used to transfer data efficiently between an external billing system (EBS) and FI-CA. Therefore, you can create the billing data in an EBS, transfer this data to FI-CA, and post it as open items automatically. Optional additional information for profitability accounting and analysis can also be transferred. Additional functions that are available to you are the archive link transfer of optically archived bills and mass reversal of documents.
In addition to the IDoc interface, a large number of Business Application Programming Interfaces (BAPIs) are also available for data transfer.

Figure 2: Interface with External Billing Systems

 Workflow Connection
Contract accounts receivable and payable enables you to define multistep processes for implementing approval or confirmation procedures (such as the dual-control principle). To do so,
FI-CA contains standard workflows for the following processes:
Post a document
Reverse a document
Modify a document (including mass changes)
Create an installment plan
Enter a repayment request
Release a document for payment
 Flexible options for defining the situations in which a workflow is to be started, the approval levels to be run, addressees and actions that are permitted up to final approval of the document are available. FI-CA functions have also been incorporated in the workflow for service connection order processing.
If a down payment is required for service connection order management, the workflow waits for the corresponding incoming payment for the down payment request. You can also define additional workflows and trigger these at defined points.

 Performance Aspects
The utilities industry requires large volumes of data to be prepared and processed while the system is used by many users simultaneously. Background processes can run in parallel in FI-CA. This distributes system load and guarantees scalability of contract accounts receivable and payable. FI-CA is also based on streamlined data structures to reduce the database size to the required minimum. FI-CA retains sufficient flexibility so that you can add any additional fields required during system

The following describes the concepts behind the business processes found in contract accounts receivable and payable.

 Postings and Reversals
A document is generated for each posting. Postings are usually generated automatically by the corresponding business processes in FI-CA
or by invoicing. Additional options for automatic data transfer are described in the "Interface Concept" in this document. Documents can also be posted manually. The account determination function can be used to determine G/L accounts automatically and to propose due dates using payment conditions in the contract account. The following is a list of typical posting documents found in utility companies:
Bills and credit memos
Dunning charges
Return charges
Cash security deposits
Incoming and outgoing payment postings including payments on account and down payments
Budget billing amounts
These are postings resulting from a budget billing plan.

 Cross-company code postings are supported by mySAP Utilities. In the deregulated market, it is possible that cross-company code invoicing or billing for and by a third party will be required. Postings can be reversed. During this process, a reversal document is generated that creates a balance of zero in conjunction with the reversed document. Both documents are linked to one another by the reversal.

 Payments - Overview
FI-CA supports all commonly used payment methods for incoming and outgoing payments in utility companies including any country-specific features. The system also provides various business processes for payments. These can be classified as follows:
Automatic payment by the utility company
This processing can be performed for all outgoing and incoming payments if the customer has granted the utility company the corresponding authority.
Process incoming payments using lots
The customer makes payments through the bank or post office.
Cash desk and cash journal. The customer makes payments at the utility company.
Payment methods are available in the various payment processes as follows:

Table 1: Available Payment Methods

 Automatic Payment
This payment program is used to make automatic payments and contains the following actions:
The system determines the items that are due. Credit memo items that have been released for payment can be taken into account automatically here.
Items for a business partner can be paid as a single total, separately by contract account or individually. The system observes your individual grouping rules and any minimum amounts defined.
The system determines the respective payment method to be used (see Table 1) based on information in the contract accounts for the business partner. You can define the payment method for specific items on an individual basis. You can propose the payment methods to be processed for each payment run. This is for instance advisable if you only wish to create checks for repayments on a weekly basis but wish to execute debit memos on a daily basis.
The system supports automatic determination of the house bank while observing any information on payment optimization.
The system makes postings for payment documents and any clearing postings automatically and clears items that have been paid.
The system then creates the output media required (such as data objects for banks and credit card companies, checks, and so forth) and accompanying letters and payment advice notes.
 In addition to payment of invoices and credit memos, the system also allows budget billing amounts to be processed automatically and repayments from the clarification work list or payments on account to be made. Customers who use the bank collection method can be rewarded for doing so.

Payment Lots
Payment lots combine payments that have a common origin or those that are to be processed collectively. They contain data on the payment origin and the note to payee. There are three basic types of lots:
Incoming check data is entered in a check lot manually.
Credit card payments either are entered manually or entered in a credit card lot through an interface.
Incoming transfers can be transferred manually, by an interface, or by using a transfer from the electronic bank statement into a payment lot.
 Lots are processed once data has been entered. Payments are assigned to open items automatically using company-specific rules. Items that have been assigned are automatically cleared. Overpayments can be posted as payments on account and underpayments can be posted as partial payments.

Cash Desk and Cash Journal
Cash desk functions are used to enter incoming and outgoing payments in dialog processing with customers. In addition to cash payments, credit card, check, and postal order payment methods are also available. Items to be paid can be determined automatically by the system. They can also be assigned by the user (in agreement with the customer). Payments on account or partial payments for various items are also possible. The system creates any documents required (such as checks or receipts). The cash desk is integrated in the cash journal and can be implemented with or without the cash journal. If the cash journal is used, additional functions are available that are described in the following sections.
 The cash journal can be used to log and evaluate postings made at cash desks in your organization in the system. The cash desk structure includes cash desks at individual branches of your company. Users are also assigned to their respective cash desk. Postings are made for each cash desk and branch. Cash desks can be opened and closed. Postings can only be made to open cash desks. In addition to incoming and outgoing payments, deposits and withdrawals from the cash desk and any differences can also be posted. You can perform a cash desk closing for each cash desk. During this process, the system clears the actual amount with the target amount from the respective cash desk. Any differences can be posted to reconcile the cash desk. The system can determine the current amount in the cash register at any stage for monitoring purposes. Evaluations based on cash desk transactions can be traced for specific days or can be traced historically. The role concept in the cash journal can be used to flexibly define responsibilities (such as the cashier, branch manager, representative, and so on). This means that branch managers are responsible for cash desk reconciliation in all of their branches.

Check Management
FI-CA supports creation, management, and cashing of outgoing checks. The payment program or the cash desk can create checks automatically. You can also enter and manage checks that have been created manually in the system. Alternatively, you can use pre-numbered checks for each house bank account or instruct the system to assign the check number.
Check management includes the following functions:
Display checks and associated payment documents
Create replacement checks
Voiding of checks with message to the bank
This can also cause the payment posting to be voided if necessary. A replacement check can be created manually or by the system as an alternative.
Check encashment
Cashing a check can be entered manually or take place by automatically processing the electronic bank statement.
Reconciliation of checks that have been cashed can either take place in the check clearing account in the general ledger or in FI-CA. If the data reported by the bank does not match the data in check management, the system automatically creates an entry for clarification processing. Any postings required are automatically generated by the system during the subsequent clarification process.

 Control Clearing of an Open Item
Open items can be cleared by various processes:
During posting of a payment document
- By the payment run
- During processing of payment lots
- At the cash desk
During invoicing (if budget billing amounts that have already been paid are cleared during invoicing or if automatic account maintenance is triggered from billing)
During automatic account maintenance
During manual account maintenance
The payment run is based on items that are due, to be paid, or ready for collection. In these situations, the payment document is automatically linked with the item, which clears the item. Budget billing amounts that have already been paid are recognized and automatically cleared by the system during invoicing. FI-CA also contains clearing control for additional processes, which can be used to represent the clearing strategy used by your organization in a flexible manner. Clearing control can be defined differently according to the contract account and business transaction involved. During assignment of incoming payments, the objective is to determine the note to payee for the payment as precisely as possible. Any specifications made by the customer are processed. Industry- and company-specific rules can also be applied. (If, for example, the note to payee is missing, payment of receivables in conjunction with a specific contract type can take precedence over other receivables or the payment amount can be distributed between several receivables.)
 Clearing processing during account maintenance takes place for open items in a contract account that have already been entered. Assigning items once the amount has been agreed is not significant. The way in which credit memo items and receivables are to be mutually cleared within specific boundaries (such as company code or within a division) is of far greater interest. This can lead to partial clearing.
 During dialog processing (for example, at the cash desk or for manual account maintenance), clearing control rules mean that while the system proposes items for clearing, you can make an alternative decision. You can suggest that receivables in a specific division or older receivables are given priority.

Returns Processing
Returns can appear in debit memo and collection procedures, check deposits, or payments. Returns are combined in returns lots. These lots can be created manually based on returns documents
or automatically by transferring returns data from the bank. Returns are then processed automatically as follows:
The payment clearing is reversed. This means that the receivables or payables cleared by the debit memo then become open items.
A returns document is created that contains offsetting postings for items in the payment document. Both of these documents have a collective balance of zero.
Additional postings are generated that are required because of expense charges and any taxes included.
Bank charges and additional internal charges are placed in the bill to the business partner.
 Returns can trigger the following subsequent actions:
Generate a customer letter
Set a deferral date
Block an account for collection
Trigger a workflow
Subsequent measures are dependent on the credit standing of the business partner and the returns frequency.

 Clarification Processing
Clarification processing allows for exceptional situations that can occur when processing incoming and outgoing payments, returns, and credit balances, so that they can be processed efficiently. The following exceptional situations can occur:
A note to payee is available for an incoming payment, to which no open item can be assigned.
A due item cannot be settled by the payment program since a payment block has been assigned to the contract account.
A customer has made an overpayment or a payment on account.
Returns with a specific reason are always to be processed manually.
The system always executes entries in the clarification work list if the business transaction cannot be processed manually or manual processing is explicitly requested in a specific situation.
Users responsible for clarification cases can be determined automatically using the organizational structure. You can also reserve a clarification case for a specific user meaning that it is blocked for processing by other users (this can be a time restriction). You can remove the block at any time. Clarification cases can also be transferred between users. Various actions are available in the system depending on the type of clarification case involved. Incoming payments to be clarified can be assigned to an open item in dialog, charged off, or flagged for repayment. The system also supports clarification of partial amounts. During clarification of the credit balance, you can transfer the amount that will be clarified to the business partner, flag this for follow-up, clear it, or repost it.

 Deferral and Installment Plan
If a customer is unable to honour his or her financial commitments, you can make a deferral or installment plan agreement for one or more receivables. The number, amount, and due
dates for installments are defined in an installment plan. During dunning and the payment run, the individual instalments are recognized instead of the original receivable. An installment plan can be deactivated if necessary so that the original receivable is re-entered in payment and the dunning run.
 The installment plan offers the following functions:
Interest based on the installment agreement can be calculated and posted automatically.
A customer letter that includes any required payment forms is created.
Installments that are not open can be deleted, amounts and due dates can be modified, and installments can be added.
Partial payment can be made for installments.
Once a certain dunning level is reached, the installment plan can be deactivated by the dunning run.
A deferral agreement means that an item is no longer dunned up to the deferral date and no bank collection takes place. If the deferral date is exceeded, the item with the original due date is dunned again or a bank collection takes place.

Business partners are reminded about (over)due open items by payment reminders or dunning notices. The system uses the dunning program to monitor payment behaviour for customers and start the required activities. The respective dunning procedure plays a central role during dunning. It controls the start date of the dunning process, the number of dunning levels, and the requirements of the respective dunning level. One example of this type of requirement is the dunning interval, which defines the length of time between reminders. This means that you can avoid sending a business partner too many dunning reminders in quick succession.
You define the actions to be performed by the system for each dunning level. The following dunning activities are available as standard:
Create dunning notice
Create bank statement
Create blocking document
Request cash security deposit
Deactivate installment plan
Hand over receivable(s) to the collections agency
 You can define any additional dunning activities required, such as those required to meet the statutory dunning requirements. You can determine the amount limit from which dunning is to start. Charges can be calculated automatically according to your requirements and posted to the general ledger or simply created as statistical postings. Interest can be calculated automatically for the items. The dunning procedure is recorded at the contract account level. You can override individual items, and temporarily exclude the item, or account from dunning. In addition to standard receivables, you can perform dunning for other items, such as budget billing requests and installment plan items. You can control which items are dunned collectively according to your business requirements by defining dunning groups accordingly. This means that you can ensure that a separate dunning notice is created for each contract or division.
 To ensure that you have statements on the dunning activities performed at any stage, dunning data is listed in the dunning history. Specific dunning proposals or an entire dunning run can be cancelled if necessary (for example, if a customer makes a complaint). This reverses dunning charges and specific dunning activities (such as handover to a collection agency or device blocking).

Figure 3: Overview of Dunning

FI-CA allows items to be handed over to an external collection agency if dunning is unsuccessful, and supports you during subsequent processes. This involves the following functions:
Release items for handover to a collection agency Automatic release can take place from the preceding dunning or charge-off processes. You can also release items manually.
Determine additional items to be handed over (for example, hand over all items for a contract, contract account, or business partner).
Flexible determination of the responsible collection agency
Recall items that have been handed over Recall can take place automatically because of an incoming
payment directly from the customer or it can take place because of items being transferred to another collection agency. Manual recall can take place if items are handed over incorrectly.
Automatic entry of incoming payments from the collection agency. This includes assigning the associated receivables and automatic entry of interest and charges including all relevant postings. If postings are entirely or partially unrecoverable, the corresponding amounts can be written off automatically. FI-CA supports electronic data exchange with collection agencies. The following communication is possible:
  Handover and recall of items
Transfer changes to the master data (such as a change to the business partner address)
Reports of collection agency payments including interest and charges Since the system lists all processing stages of an item, you have the option of creating detailed evaluations at any stage (so that you can check the efficiency of your collection agency).

 Interest Calculation
By calculating interest for line items, you can use interest to control your customers' payment behaviour. For example, you can pay interest for an incoming payment that is received earlier,
while deducting interest for an incoming payment that is received later. Interest calculation provides a number of functions that permit flexible individual processing of different line items and therefore allow specific agreements with customers to be implemented. The system differentiates between debit and credit items, and between open and cleared items. You can also decide what procedure is to be used for specialist line items such as installment plan items, cash security deposits, yearly
advance payments for a budget billing plan, and statistical items like budget billing requests.
 You can start interest calculation in various processes:
Interest calculation in a mass run: The system calculates interest for all line items that match
the selection requirements.
Interest calculation in individual processing Interest is determined on an individual basis for selected line items for a business partner, contract account, or contract.
Interest calculation in a dunning run Interest is calculated for all overdue line items after
a dunning level that you define has been reached.
Interest calculation in invoicing Interest calculation for cash security deposits can be triggered from invoicing. Interest can be printed on the bill or the dunning notice.
 Interest keys control calculation rules and interest rates. They can be recorded at contract account level, determined automatically for each item according to the business transaction involved, or set manually. The interest key is determined from the dunning level for interest calculation in the dunning run. Interest blocks can be used to exclude specific items from interest calculation. You can exclude certain business transactions (such as reversals or additional receivables). You can also define amount limits. This avoids calculating interest for minimum amounts.
 The system can post the interest determined as a general ledger or statistical posting and can generate the necessary correspondence. Interest history is listed for an item, which ensures that interest calculation can be tracked. It also ensures that interest is not calculated more than once for items.

FI-CA supports requests for securities. Security deposits can be requested from new customers or from customers who have an irregular payment history. The system makes a distinction between cash security deposits and non-cash security deposits:
  Cash security deposits can be levied manually as required or automatically at the contract start by processing a move-in. They are posted to a specific contract or a contract account. Cash security deposit payments that have been made are refunded if the payment behaviour of a customer develops positively over an extended period. You can calculate interest on cash security deposit payments across the entire period. Cash security deposit payments and interest are usually cleared as part of a final settlement. It can also be paid sub-annually or cleared.
Non-cash security deposits include savings accounts or guarantees. The savings account holder or the guarantor is specified when they are entered.

 Transfer Open Items
It is always necessary to transfer receivables or credit memo items if a business partner takes on the rights and responsibilities of another business partner, as is the case for inheritance or debt transfer. It is sometimes necessary to transfer receivables or credit memo items within various contracts or contract accounts for the same business partner. This is the case if a customer terminates a contract but the remaining receivables are to be paid with the receivables for the new contract. During
transfer, the system clears the items selected and generates new open items for the target business partner/account/contract.
Most of the posting information is copied during this process.

 Collective Bill Processing
Collective bill processing enables you to combine documents from different contract accounts or business partners for collective processing, for example during bill creation, payment, or dunning processing. Individual documents are grouped under a collective bill document number. Collective
bills are, for instance, used for building companies, municipal administration departments, and major companies. Documents that are part of a collective bill appear on the individual contract account and the collective bill contract account. You can also assign an incoming payment to a collective bill or individual contract accounting documents.

Third-Party Billing in the Deregulated Market
Contract Accounts Receivable and Payable supports various scenarios in the deregulated utility market and is suitable for use by service providers (companies that are involved in supplying a point of delivery) as well as companies that create bills. The following sections describe special functions for contract accounts receivable and payable that are used to represent deregulation scenarios. A company can use FI-CA to manage both its own receivables to its customers and the receivables of third parties to these customers. Separating transmitted items from your own receivables is a statutory requirement. Usually, transmitted items also have different tax requirements to those for your own receivables. FI-CA can be used to manage several company codes in parallel and record different processing rules. Processes can be performed across all company codes (for example, payment processes).   

Figure 4: Deregulation - Advance Payment

 FI-CA supports advance payment and customer payment during payment management.
Advance payment Advance payment involves all receivables for a service provider to its customers being handed over to a third party (billing party). Payment to the service provider is made by the billing party independently of the incoming payment from the end customer. Any dunning notice for the service provider is addressed to the billing party. The system automatically rejects collection of the bill amount from the end customer. The end customer is dunned by the billing party if advance payment is used. Payments to the service provider are made independently from payments of the end customer to the billing party and can be managed automatically by the system. FI-CA supports both advance payment in which the billing party simply acts as a billing agent as well as procedures in which the billing party is the sole provider.
Customer payment. Customer payment (comparable to advance payment) involves the billing party being responsible for payment management with the end customer. However, the service
provider does not receive payment from the billing party until payment has been received from the respective end customer. The service provider is usually responsible for dunning unpaid items. Both the service provider and the billing party need to be able to track each individual item. FI-CA supports detailed payment advice notes for items in addition to automated payment forwarding.

 Figure 5: Deregulation - Customer Payment

 The company performing the service and the billing agent both store detailed data on the end customer. The billing party also creates a collective list of payables to the service provider and the service provider has a corresponding list of all receivables to the billing party.

It is necessary to write off items if receivables are irrecoverable or payables cannot be paid because it is not possible to determine the payment recipient. FI-CA supports automation of this process. You can record individual write-off rules (such as amount limits) in the system. FI-CA can also be used to write off individual items in dialog processing or to write off partial amounts. (Dialog processing is the opposite of background processing. In dialog processing, the user can control what
happens during write-off. He or she cannot do this in background processing.) The system automatically makes the necessary posting, including tax correction postings required during
write-off. Write-off also includes the following functions:
Items to be written off can also be transferred to a collection agency.
Items that the collection agency reports to be irrecoverable are written off automatically.

Correspondence with your business partners can be controlled by events in FI-CA (for instance during dunning) or can be created periodically (bank statements). The system also allows you to request single correspondence (such as a receipt or account information). Standard forms are available for each corresponding type that you can modify to meet your requirements. The following letters are available:
Bank statement
Balance notification
Business partner move-out
Dunning notice
Letter about installment payment agreements
Letter about deferral agreements
Print returns notice
Interest calculation letter
Notification about credit clarification
Notification about incoming payments and payment usage
Confirmation of changes made to the master data
Receipt for a cash-desk payment
Payment advice note
Request for securities
 You can attach a payment form to correspondence that requests payment automatically. The system also provides flexible options for determining the correspondence recipient or recording additional correspondence recipients. You can define different addresses for various kinds of correspondence.

 Statutory Reporting
FI-CA contains comprehensive functions for managing statutory requirements with regard to sales tax, withholding tax, and foreign trade declarations including the respective county-specific
Tax returns for tax on sales/purchases
When transactions that are relevant to sales tax are posted, such as receivables and payables, or down payments that are managed as gross amounts, the system determines the tax indicator and corresponding tax account to be used based on the business transaction involved. Corresponding postings to the tax accounts are made automatically. Depending on the statutory requirements and the level of detail required, you can create your returns from the general ledger in the Financial Accounting component (FI) or you can update a separate reporting file in FI-CA. This is used as the basis for creating returns. This means that reports can be created for the posting date due dates or dates on which payment is made. The level of detail for the returns and statements is defined by making the corresponding system settings. You can assign county- or region-dependent taxes or produce a statement for the individual documents.
Withholding tax returns
FI-CA supports credit and debit withholding tax. The withholding tax indicator to be used is determined from the master data for the business partner involved when the receivables or payables are posted. The system makes the corresponding tax postings automatically for incoming and outgoing payments. A separate reporting file is created that forms the basis for the return.
Foreign trade declarations
Transactions with tax-based non-resident companies include stock reports and transaction reports. Transaction reports that relate to payment transactions are based on a separate reporting file that is updated if incoming payments are received or outgoing payments are made. Stock reports are made using open item lists that meet the corresponding selection requirements. The legal recipient code, for example the state central bank indicator for Germany, can be recorded in the system settings and set automatically.

 Reconcile Contract Accounts Receivable and Payable with the General Ledger
In view of the large document volumes, sales figures are not updated consecutively in the general ledger during posting in FI-CA. Instead, FI-CA documents are summarized as summary records. These are periodically transferred to the general ledger in the Financial Accounting component FI or an external system. This improves performance and reduces document volumes in the general ledger. The reconciliation key connects the general ledger within the sub-ledger. It is used to itemize amounts posted to the general ledger and perform reconciliation between FI-CA and the general ledger.
Figure 6: Transferring FI-CA Documents to the General Ledger 
 Closing Activities
Contract Accounts Receivable and Payable supports all standard closing activities. The following functions are available:
Foreign currency valuation
This valuation is used to revalue open items so that associated payable and receivable accounts can be corrected when the balance sheet is prepared. This valuation can use standard valuation procedures (such as the lowest value principle).
Individual items that are open on the balance sheet key date are used for the valuation. Valuation can take place in the house currency and currencies that are managed in parallel (such as in the group currency or hard currency). G/L accounts, to which exchange rate differences from the valuation are to be posted, are determined and posted to by the system automatically.
Receivables adjustment
This is used to mark receivables as being doubtful and to correct individual receivables values. It brings receivables in accounting into line with the estimated receivables value.
Receivables can be marked as doubtful if the business partner may no longer be able to settle them. The receivable that has been marked as doubtful is separated from other receivables by making a posting to a separate receivables account. By adjusting individual values, the value of each receivable can be adjusted to any percentage rate. Adjusting individual values triggers a posting to an expense account. The system automatically posts any tax corrections. Adjusting a single value is always based on a receivable that has been marked as doubtful. However, a receivable can be marked as doubtful without adjusting a single value. Marking receivables as doubtful and adjusting single values can be automated (based on the age of the receivable). If adjusting a receivable triggers a payment, the system performs all correction postings that this requires.
Reclassification displays vendors with a debit balance, receivables, and payables according to their remaining term.
Revenue deferral
Revenue deferral represents time-related revenue recognition in FI-CA. Revenues are initially posted with the receivable. If revenue deferral postings are required, the system performs these automatically.

 Account Balance Display
Account balance display gives you an overview of financial transactions at the business partner or contract account level.
You can define the display of the business partner or the contract account on an individual basis. In addition to selecting the items required (such as cleared items only including statistical items), setting variants give you flexible control options for line construction.
 The following settings are available:
Variants for items define which document information are displayed.
Totals variants define the criteria used to cumulate a single item.
Sort variants define the sequence in which items are displayed.
You can toggle between display variants, show additional information, or use search and filter functions within the account balance display. The system makes all associated information
available starting from a specific document and allows you to branch to other areas such as:
  Business partner, contract account, and contract master data
Dunning, returns, and clearing history
Payment usage
Installment and budget billing plans
 You can generate correspondence such as payment forms or account balance information from the account display.

 Figure 7: Account Balance Display

 Business Partner Evaluation
FI-CA records the business behaviour of your business partners, which enables you to evaluate them. You can make this available to various processes as a credit standing. This means that activities associated with dunning and returns can be performed differently according to the current credit standing of the business partner. The current credit standing of a business partner is updated by the following processes:
Transfer credit standing data from external data sources
Set a manual value
Dunning notices that take account of the respective dunning level with the option of weighting this by time. This can be defined so that current events have a greater influence on the credit standing than those that are less recent.
Returns taking into account the return reason and the option of weighting this by time

In addition to numerous evaluations at business partner and contract account level, additional summary evaluations are available for day-to-day activities and settlement purposes.
These include the following:      
Open item lists for a key date In addition to evaluating open items for each business partner
or account, a number of additional functions are available for selection and output control.
Due date list for open items
Document journal
Statement of individual documents in the clarification accounts Integration with the SAP Business Information Warehouse also enables you to implement your strategic reporting requirements.

Integration with the general ledger and other ledgers documents that are generated in G/L accounting when summary records are posted offer you the same integration functions as standard FI documents and lead to additional ledgers and Controlling (such as overhead cost controlling or profitability analysis) being updated automatically. Additional information was discussed in this document under Reconcile Contract Accounts Receivable and Payable with the General Ledger.

Integration with Cash Management
A posting in FI-CA triggers an immediate (synchronous) posting in the cash management component (TR-CM). The liquidity forecast and the cash position in cash management are therefore always up to date.

Figure 8: Integration with the General Ledger, Controlling, and Cash Management

 Integration of Consumption and Service Billing
Invoices and credit memos from contract billing and invoicing are posted in FI-CA automatically. You can also indicate whether invoices and credit memos that were generated in the Sales and Distribution (SD) component for services are also to be managed in the Contract Accounts Receivable and Payable component. As an alternative to generating billing documents in the SD component, you can bill the corresponding amounts with the consumption bill.

 Integration with mySAP Customer Relationship Management
FI-CA works with mySAP CRM in a number of different ways. As a result, many functions in FI-CA can be accessed from the mySAP CRM interaction center (IC). The IC offers call center capabilities for sales or customer service organizations. The IC allows agents to process inbound and outbound contacts as well as business transactions related to a customer. You can generate a call list from a dunning run that is automatically available in mySAP CRM for processing.

 Integration with Credit Management
Credit management functions are used to define and monitor credit limits. Items that are currently open, as well as data on a business partner's credit worthiness are included here.

 Integration with Dispute Management
Dispute management functions are used to create, edit, and follow disputes. A dispute can be triggered directly by a customer complaint or indirectly by a corresponding customer action (such as underpayment of the bill). Integration with FI-CA involves the following functions:
Creation of a dispute case from FI-CA processes
Association of a dispute case with a FI-CA document to facilitate straightforward resolution of the case
Option of accessing FI-CA functions from case processing (to block an item for dunning)

 Integration with FSCM Biller Direct
Financial Supply Chain Management (FSCM) Biller Direct gives business partners online access to their accounts and bills through the Internet. In addition to displaying data, the following functions are available:
Payment authority (automatic debit, credit card debit)
Clearing of credit memos
Master data changes
Functions in the FSCM Biller Direct trigger an immediate update in FI-CA.

 Integration with SAP Business Information Warehouse
SAP BW permits strategic reporting based on FI-CA data that is tailored towards your specific requirements. To do so, FI-CA provides extractors for open and cleared items and a sequence
of standard reports that build on this information. Consequently, the system can be used to perform many different types of evaluation and analysis. These include:
Display items in a sorted list
Overdue analyses
Analysis of payment behaviour for specific customer segments
Seasonal variations in payment behaviour
Average delay in payment

Contract Accounts Receivable and Payable offers you the following advantages:
High levels of automation that significantly reduce the effort required to complete routine tasks
Reduction in the average value of accounts receivable as a result of increased efficiency in receivables management
Improved customer service due to transparency and simple tracking of activities
High levels of customer satisfaction thanks to the option of responding to the individual customer requirements and representing these in the system
Reduced operating costs due to seamless integration with other solutions
Employees are who motivated by functions that are easy to use in a user-friendly system

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