Streamline Invoice Processes and Improve Customer Relationships by Implementing SAP SD Retroactive Billing

  • by Gaetano Altavilla, Senior SAP Solutions Architect, Instructor, Project Manager, and Team Leader
  • April 6, 2012
Implementing retroactive billing, available to you in SAP ERP Central Component 6.0, addresses the issue of changing pricing after invoices have already been sent. Learn the configuration steps needed to run retro-billing across modules in your SAP ERP system. Maintain your good customer relationships using this accurate, consistent business process.
Key Concept
Companies typically have agreements with customers to invoice them regularly during the fiscal year using different prices. To update prices at the end of that period, you can implement retroactive billing, or retro-billing – a process that automatically adjusts invoices based on new prices defined retroactively, generating the corresponding credit or debit notes.

If you bill customers on a regular basis, but are then faced with having to correct invoices already posted, you can implement the SAP-provided tools for not only adjusting the posted invoices to reflect the new prices (e.g., changes in market values), but also to monitor this process. SAP’s retro-billing process available enables you to automatically adjust the invoices based on the new prices defined retroactively, automatically generating the corresponding credit or debit notes. Additionally, SAP offers many standard tools to monitor this process.

The main benefits of the retro-billing functionalities include:

  • Improving a company’s revenues
  • Streamlining the invoice processes for a specific period (i.e., a fiscal year)
  • Helping to plan and manage a company’s cash flow
  • Improving the customer relationship and satisfaction
  • Helping to plan and manage the customer’s cash flow

The retro-billing process also produces a history of sales orders and the effects that the changes have on your customer accounts. This information can be invaluable to your organization.

Using a fictitious business case, you will walk through the retro-billing process. Your first task will be to display the condition price for the customer with which you already have an agreement and to which an invoice has already been sent. Although you will be using a sales order as reference to the billing document in this article, you can apply retro-billing to all other SD documents.

Note
The audience for this article is logistics consultants and anyone working in SAP logistics modules or in blueprints for future logistics implementations.
Note
The article is based on the latest version of SAP ERP Central Component (SAP ECC) 6.0, and specifically relates to the SAP sales and distribution (SAP SD) and SAP Logistics Execution-Shipping (LE-SHP) modules.

Gaetano Altavilla

Dr. Gaetano Altavilla is a certified associate senior SAP solutions architect, instructor, project manager, and team leader located in Naples, Italy. His focus is on pre-sales, delivery of SAP application solutions for large international corporations and SAP knowledge management across regions.

In his 16 years of SAP application experience working for many multinational companies, such as Procter & Gamble and Hewlett-Packard, he has covered a wide range of ERP logistic areas, focusing on the MM, WM, SD, LES, PP, PP-PI, PLM (QM, PM, PS) modules, as welll as CRM (TFM), SRM (EBP), SCM (APO), SCM (TM) and SCM (EWM) components.

Dr. Altavilla holds a degree with first-class honors in mathematics from the University of Naples and is certified in many SAP modules: SAP Logistics Bootcamp, SAP MM, SD, LE (SHP/WM/LE), PP, PLM (PM, QM, PS), SRM, CRM, SCM (APO), SCM (TM), FI, CO, and Solution Manager. He also has experience in ABAP/4 and application link enabling (ALE) and IDocs. He has participated in numerous industry conferences, such as the SAP Skills Conference in Walldorf at SAP SE.

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