Make SAP Automatic Credit Management Work for You: Credit Limit Calculation

  • by Dr. Stef G.M. Cornelissen, MBA, SAP Business Consultant, Sperry Partners BV
  • April 15, 2006
Learn how to set up your credit management organization so that your system can check credit controls automatically.
Key Concept

A credit control area is an organizational unit you use to establish your credit management protocol in Accounts Receivable (FI-AR) and Sales and Distribution (SD). Within it, you set and control credit limits for your customers. A credit control area may contain multiple customer company codes, but you can assign each company code to only one credit control area.

Credit management is a vital part of any sales organization. 

My previous article, “Make SAP Automatic Credit Management Work for You,” explained how you can block sales orders and deliveries if a customer is exceeding a credit limit or showing undesired payment behavior. In this article, I’ll look at credit limit calculation and show how you can organize your credit management using your SAP R/3 or mySAP ERP Central Component (ECC) system.

This functionality has been around since R/3 Release 3.0. The process includes definition, setting up the process for new customers, and assignment. The prerequisite is the customizing of automatic credit checks in the sales module, which I covered in my earlier article. The previous article also covered troubleshooting and workarounds for exceptional situations.

Dr. Stef G.M. Cornelissen

Dr. Stef G.M. Cornelissen, MBA, is an experienced international SAP business consultant from the Netherlands with certifications in FI, CO, and SD. He took part in important international projects involving the large Dutch multinationals. Before specializing in SAP, he worked as a management consultant and was a senior advisor to the Board of Directors of the University of Nijmegen. Stef's academic background is in business administration, economics, and organizational science. He is the owner of Bowstring BV and principal partner at Sperry Associates.

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