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