Managing Balance Confirmations for Suppliers

Objectives
After completing this lesson, you will be able to:

After completing this lesson, you will be able to:

  • Schedule and monitor the creation of balance confirmations using the apps Schedule Accounts Payables Jobs and Manage Balance Confirmations for Suppliers

Supplier Balance Confirmations

Introduction

Supplier payables are checked for correctness during year-end closing in cooperation with internal or external auditors.

Jake received the following mail from Jennifer, internal auditing department:

Supplier Balance Confirmation

Jake has some questions for Jennifer because he's doing this task for the first time, so he calls her.

Jake: Hi Jennifer! Thank you for offering to help me. I just wanted to ask you a couple of questions.

Jennifer: No worries! How can I help?

Jake: What's the difference between a balance confirmation and a balance request?

Jennifer: With a balance confirmation, we tell the supplier how much we owe them and ask for a response. With a balance request, we ask the supplier to tell us how much we owe.

Jake: And why did we change the procedure this year?

Jennifer: We changed things because not enough suppliers responded to balance requests. Hopefully, the ratio will increase again this year.

Jake: Good to know.

Jennifer: Oh! Also, balance notification is another option where the supplier only replies if they disagree with the balance.

Jake: Thanks for letting me know!

Jennifer: No worries - we were all new once. By the way, could you check if our current reply address is correct? We moved to the company campus last year, so we should double-check our details.

Jake: Yes, of course. Everything looks good on my side. So, how do we create a new business partner for another reply address?

Jennifer: Good question. Create a new business partner with the business partner categories Organization or Group.

Jake: Thanks, Jennifer. I will let you know when I schedule the Balance Confirmation in the SAP system.

Jennifer: Perfect. If you have any further questions, feel free to reach out!

Jake's Summary

There are three ways to send letters:

  • Balance Confirmation: Ask for confirmation of specific amounts and a reply, irrespective of whether the amounts correspond.
  • Balance Notification: Tell the supplier the amounts to be confirmed. Keep in mind that they only reply if they disagree with the balance.
  • Balance Request: Ask the supplier for the amount in our account.

To reconcile our accounts, we contact vendors to fix any mistakes.

In SAP S/4HANA Public Cloud, the reply address must be a business partner of the category Organization or Group. To create the letters, use the Supplier Balance Confirmation job template in the Schedule Accounts Payable Jobs Fiori app.

Additional Information

In SAP S/4HANA, set the reply address in customizing when using the Create Balance Confirmation – For Suppliers app.

Create a Supplier Balance Confirmation

In this exercise you will create a supplier balance confirmation and check the results using the Manage Balance Confirmations For Suppliers Fiori app.

Glossary

Were there some terms in this lesson you’d like further information on? See below a glossary of mentioned terms:

Balance Confirmation: You let the supplier know which amounts you need confirmation for and ask for a reply, even if the amounts are correct.

Balance Notification: You let the supplier know which amounts you need confirmation for, but they only need to reply if they disagree with the balance.

Balance Request: You ask the supplier to tell you about the amount on your account according to their records.

Reply To: This is where you specify the reply address in the Supplier Balance Confirmation job template. It's mandatory to create the business partner master record with the business partner category Organization or Group.

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