Invoice Rules

Objectives

After completing this lesson, you will be able to:

  • Describe SAP Business Network country-based invoice rules and how they function

SAP Business Network Country-based Invoice Rules

General Invoice Rules

These rules apply generally to all invoices submitted through the SAP Business Network. The transaction rules are baselined, however there are some rules that you may want to change to align with your business processes. Consider the following questions when making updates to your account.

  • Do you allow invoice attachments? If so, what type of information are you expecting to receive? Who will review and process this?
  • Do you have a strict purchase order (PO) policy, or will you allow non-PO invoicing?
  • Will you allow trading partners to reuse invoice numbers if the SAP Business Network rejects the invoice before it reaches your ERP?
  • Are you okay with trading partners adding any allowances/charges on an invoice as one of a discount, shipping, or special handling charge line item, or do you require certain allowances/charges to be identified separately?Do you allow Invoice attachments? If so, what type of information are you expecting to receive? Who will review and process this?
  • Allow suppliers to send invoices to this account.This image shows the Rule “Allow Suppliers to send Invoices to this account”.

    If you do not want to allow trading partners to submit invoices, this rule should be "unchecked". During an initial SAP Business Network deployment, SAP recommends leaving this rule unchecked in your production account until you are ready to go-live with trading partners.

  • Require Suppliers to send invoice attachments.
  • This image shows the Rule “Require Suppliers to send Invoice attachments. An information box is open with text that says Suppliers must add an attachment when creating an Invoice”.

    You have the option to both allow and require trading partners to send invoice attachments. This rule, when checked, will require that trading partners provide an attachment when invoicing via the SAP Business Network. They will receive a message via the UI that an attachment is required before they are able to successfully submit their invoice via the SAP Business Network. This may pose a challenge to your trading partners, so it is recommended to enable this at the supplier group level (in addition to the rule "Require suppliers to send credit memo attachments"); if not all your trading partners are required to provide an invoice attachment. The rule "Allow suppliers to send invoice attachments" must be "checked" to display the rule "Require suppliers to send invoice attachments".

  • Allow Suppliers to send non-PO invoices.
  • This image shows the Rule “Allow Suppliers to send non-PO Invoices”. The additional information box is open, displaying the text: On SAP Business Network, Suppliers create non-PO Invoices for purchase orders that were not routed through SAP Business Network for which no Purchase Orders exist. If you allow Suppliers to create non-PO Invoices, and they enter a Buyer Order Number when creating the non-PO Invoice, SAP Business Network will validate if the Buyer Order Number matches an existing purchase order on SAP Business Network. If it does, then the Invoice is treated as a PO-based Invoice.

    If you allow trading partners to send invoices that do not reference a purchase order (that was sent via the SAP Business Network), this rule should be "checked". If only a subset of trading partners should submit non-PO invoices, this rule can also be set at the supplier group level as needed. If you require that all trading partners must invoice against a PO, do not check the rule.

    Note that if you do not allow non-PO invoicing, but you allow trading partners to submit a header level credit memo that does not reference an invoice on the SAP Business Network, you must have this rule set to "check" for your trading partner to follow the necessary steps to create that document type.

  • Allow suppliers to send line item credit memos.This image shows the Rule “Allow Suppliers to send line item credit memo, with boxes to check for Quantity Adjustment, Price Adjustment, Quantity Adjustment for Contract Line-level credit memo and Price Adjustment for Contract Line-level Credit Memo”.

    You can allow credit memos at either the header or line item level, or both. If you allow line item credit memos, be sure to configure each setting accordingly for quantity/price adjustment.

    • Quantity adjustment: Allow suppliers to send line item credit memo with quantity adjustment.
    • Price adjustment: Allow suppliers to send line item credit memo with price adjustment.
    • Quantity Adjustment for Contract Line-level credit memo: Allow suppliers to send line item credit memo with quantity adjustment for contract Invoices.
    • Price Adjustment for Contract Line-level credit memo: Allow suppliers to send line item credit memo with price adjustment for contract invoices.

    You can also check the separate rule Require suppliers to provide a reason for each credit memo if needed.

  • Allow suppliers to cancel invoices they create.This image shows the Rule “Allow Suppliers to cancel Invoices they create”.

    If trading partners make a mistake, they might want to cancel the invoice. If you allow trading partners to reuse invoice numbers, they can correct their invoices and resubmit them using the original numbers.

    Keep in mind that you may still need to approve the canceled invoice for the funds invoiced to return to the purchase order (if the invoice was submitted against a purchase order).

  • Allow suppliers to reuse invoice numbers.This image shows the Rule “Allow Suppliers to reuse Invoice numbers. The box is checked, so the sub-rules are displayed for Canceled, Rejected, and Failed”.

    This rule allows trading partners to modify and resend "canceled", "rejected", or "failed" invoices using the same invoice number, depending on selection. This setting may require configuration in your procurement application in addition to adjusting the settings on the SAP Business Network.

  • Allow suppliers to reuse Invoice numbers from past calendar years.This image shows the Rule “Allow Suppliers to reuse Invoices from past calendar years”.

    If this rule is "checked", invoice numbers must be unique only within the current calendar year. For example, a trading partner can send only one invoice with invoice number 001 in 2023, but can send another invoice with invoice number 001 in 2024.

  • Allow suppliers to add allowances and charges to invoices.This image shows the Rule “Allow Suppliers to add allowances and charges to Invoices”. It also shows the Rule “Require Suppliers to provide negative tax on allowances and charges, with a link to configure list of allowances and charges”.

    If this rule is "checked", trading partners can add allowances and charges to PO-based invoices, non-PO invoices, and credit memos. Allowances and charges are separate from tax, discounts, shipping, and special handling charges. Unchecking this rule does not prevent trading partners from adding tax, discounts, shipping, and special handling to invoices.

    Pay attention to the second part of this rule: "Require suppliers to provide negative tax on allowances and invoices". If this rule is "checked", taxes added on allowances in invoices or debit memos must be negative. For credit memos, taxes added on allowances must be positive.

    If you allow trading partners to add allowances and/or charges to invoices, you can also configure a list of these by clicking on the text in blue to display the next page and configure your allowance/charge(s).

This image shows the screen to Configure Allowances and Charges.
This image shows the pop up window to Create Allowance.

PO Invoice Field Rules

These rules apply to invoices submitted against a purchase order. There are a few questions you’ll want to consider before configuring these rules.

  • Will you allow trading partners to change information on a PO-based invoice from what was originally sent on the Purchase Order?
    • If yes, how flexible do you want to be with trading partners? Certain rules will allow you to set up tolerances to control how much the invoice exceeds the purchase order. SAP recommends to allow a greater tolerance pass through the SAP Business Network and have stricter rules on your back end system.
    • If no, make sure this is clearly communicated to your trading partners and a clear process is established between the business and trading partners to request change purchase orders with updated information.
  • What if a trading partner needs to bill for something not on the original purchase order? Will this require a change purchase order, can trading partners add line items to PO- based invoices, or should they submit a non-PO invoice?

Consider the following rules when determining what you will or will not allow for trading partners to edit on a PO-based invoice:

  • Allow suppliers to change the unit price.This image shows the Rule “Allow Suppliers to change the unit price”. The rule is “Unchecked”, and the sub-rule “Check Price Tolerances” is displayed and “Checked”. The box for “Exception Tolerance” has a text field showing 10%.

    Due to variations in pricing or availability, trading partners might need to increase the unit price for an item.

    "Checking" this rule will allow trading partners to increase the unit price without restriction. However, if you "check" the box for "Check Price Tolerance", you can enter a percent that cannot be exceeded.

  • Allow suppliers to change the unit of measure.This image shows the Rule “Allow Suppliers to change the unit of measure”.

    Trading partners might need to change how an item is packaged or delivered, particularly for non-catalog items.

  • Allow suppliers to increase item quantities.This image shows the Rule “Allow Suppliers to increase item quantities”. The box is “Unchecked”, showing the sub-rule “Exception Tolerance”, which has 10% entered into the text field.

    Trading partners might need to increase item quantity for best pricing or shipment, particularly for non-catalog items.

    "Checking" this rule will allow trading partners to increase the quantity without restriction. However, if you "check" the box for "Exception tolerance", you can enter a percent that cannot be exceeded.

  • Allow suppliers to increase line item subtotals.This image shows the Rule “Allow Suppliers to increase line item subtotals”.

    Trading partners might need to increase line item subtotals due to variations in pricing or availability.

  • Allow suppliers to change part number. / Allow suppliers to change auxiliary part ID.This image shows the Rule “Allow Suppliers to change part number and Allow Suppliers to change auxiliary part ID”.

    Trading partners might need to use newer or replacement part numbers, particularly for non-catalog items.

  • Allow suppliers to add line items to PO Invoices.This image shows the Rule “Allow Suppliers to add line items to PO Invoices”.

    Trading partners might need to bill for items that do not appear on the original purchase order.

  • Require invoice Sold To Name and Country to match PO Bill To Name and Country (or Sold To information if available).This image shows the Rule “Require Invoice Sold To Name and Country to match PO Bill To Name and Country (or Sold To information if available)”.

    The Sold To and the Bill To addresses are usually the same, although Sold To is more important for VAT purposes. You can require that SAP Business Network validate whether Sold To information on invoices matches Bill To information on purchase orders (or Sold To information, if available).

    If this rule is "checked", then the following rule is also enabled: "Copy Bill To address on purchase orders to Sold To address on invoices".

PO and Non-PO Invoice Field Rules

This section contains rules that pertain to purchase order and non-PO invoice field rules. This includes defining which items and requirements are allowed and required on purchase order and non-PO invoices.

There are a few questions to think about before configuring these rules.

  • Can trading partners send taxes at the header level, line level, or both?
  • Do you allow invoice future-dating or back-dating?
  • Do you require trading partners to provide tax ID or other identifiers?
  • Do you require an order number for non-PO invoices?

Consider the following rules when determining what you will or will not allow trading partners to edit on a purchase order or non-PO based invoice:

  • Allow invoices to be back-dated the specified number of days.This image shows the Rule “Allow Invoices to be back-dated the specified number of days”.

    This is the number of calendar days trading partners can back-date invoices.

    Note that backdating an invoice is based on Invoice creation date, not purchase order creation date.

    Some trading partners process their Invoices in bulk, so you may want to allow flexibility for them to apply a date earlier than the day they log into the SAP Business Network.

    To reject back-dated invoices, enter 0.

  • Require suppliers to choose from your list of valid tax values.This image shows the Rule “Require Suppliers to choose from your list of valid tax values”.

    SAP recommends setting to "no", especially for US-based trading partners. There are far too many tax values to configure, and the maximum number which can be configured in the list is 20. If needed, this can be set up at the country level.

  • Allow net amounts to exceed subtotals.This image shows the Rule “Allow net amounts to exceed subtotals”.

    Trading partners might need to increase the subtotal of an invoice to include special handling, shipping, and tax amounts. When this rule is "checked", SAP Business Network does not check invoice net amounts.

    When this rule is "unchecked"the SAP Business Network displays an exception tolerance % field.

  • Require suppliers to provide order information.This image shows the Rule “Require Suppliers to provide order information”.

    This rule is applicable for non-PO invoices or credit memos. If the rule is checked, a trading partner must enter a value in at least one of the order information fields (Customer order #, Sales order #, Contract #). If the rule is "unchecked", the values in the order information fields are optional.

  • Require suppliers to provide tax information in Invoice.This image shows the Rule “Require Suppliers to provide tax information in Invoice”.

    SAP recommends setting to "check", as typically some type of tax is entered on invoices, even if it is 0%.

    If "checked", the rule Require VAT will display. SAP recommends setting this in the country-based invoice rules, since some countries do not have VAT taxes.

Invoice Address Rules

Invoice address rules allow you to control the address information that trading partners can or must supply on their invoice.

Consider the following questions:

  • Do you require a Bill To address on invoices?
  • Do you require a Sold To address on invoices?
  • Do you require a From address on invoices?
  • Do you require a Remit To address on invoices?
  • Do you require Ship From and Ship To addresses on invoices?
  • Will the required information change based upon the trading partner’s location?
This image shows a list of Invoice address rules. These includes: “Require a Bill To address on Invoices”, “Require a Sold To address on Invoices”, “Require a From address on Invoices”, “Require a Remit To address on Invoices”, “Require Ship From and Ship To addresses on Invoices”, “Enforce strict address validation for required address fields”.

Invoice Payment Rules

Payment terms are sent on purchase orders and automatically flipped to invoices (PO-flip). Consider if you will allow trading partners to modify the net terms and discounts that you send.

Invoice due date is not displayed on invoices. Due date is the baseline date plus the payment term. Normally, baseline date should be the same as invoice date.

If you will require bank details to be sent on invoices, decide whether your ERP vendor data or the information that the trading partner provides on the invoice will be the source of truth. If the invoice is the source of truth, consider the workflow for an exception process if the bank details do not match your ERP vendor data. The rule "Require suppliers to include bank account details on invoices" enforces the inclusion of bank account number and SWIFTBIC on invoices. When enabled, the sub-rule "Require IBAN" appears.

This image shows a list of Invoice Payment Rules, including: “Allow Suppliers to change payment net term as shown on purchase orders”, “Allow Suppliers to change payment discount terms as shown on purchase orders”, ’Allow Suppliers to omit payment terms in PO Invoices”, “Require Suppliers to provide penalty information or terms on Invoices”, “Require Suppliers to provide discount information or terms on Invoices”, “Require Suppliers to provide net term information on the Invoice”, “Require Suppliers to include bank account details on Invoices”, ”Allow Suppliers to send payment receipts for partially or fully paid Invoices”.

VAT Rules

Value added tax (VAT) rules are available for configuration at the default transaction rules level, however it is generally recommended to handle these rules at the country-based invoice rules level. As a reminder, "Allow" rules must be "checked" at both the default transaction rules and the country-based invoice rules level to enforce the rule.

Blanket Purchase Order Rules

A blanket purchase order is a type of purchase order issued to a trading partner for multiple purchases of specific goods or services for a specific time period and a not-to-exceed a predetermined amount. The blanket purchase order allows purchases, within the terms of the order, to be charged to that specific blanket order.

When deciding on how to configure blanket purchase order settings, consider the following questions:

  • Will a blanket purchase order follow the same invoicing rules as standard purchase orders? Or will specific blanket purchase order transaction rules be required?
  • What if the final service provision occurs around the end date of the blanket purchase order? How will this be handled?

Learn more about rules you may want to consider for Blanket Purchase Orders (BPO). You may move ahead to the next section if blanket purchase orders are not in scope.

  • Enable BPO-specific invoice rules.This image shows the Rule “Enable BPO-specific Invoice rules”.

    SAP recommends to check this rule when blanket purchase orders are in scope to allow more flexibility for trading partners. Blanket purchase orders may display the maximum total amount versus the exact quantity or pricing.

    Check this rule if invoices created against a BPO should follow different rules than those set in the PO/non-PO invoice field rules.

    Leave this rule unchecked if the same rules will apply as PO/non-PO invoice field rules.

  • Allow suppliers to create order confirmations, ship notices, and invoices for expired blanket purchase orders.This image shows the Rule “Allow Suppliers to create Order Confirmations, Ship Notices, and Invoices for expired blanket Purchase Orders”.

    SAP recommends to "check" this rule because the final service provision may occur around the end date of the blanket purchase order.

    "uncheck" this rule to prevent trading partners from creating transaction documents for expired blanket purchase orders.

  • Allow adding a child item to an invoice for Blanket Purchase orders.This image shows the Rule “Allow adding a child item to an Invoice for Blanket Purchase Orders”.

    When this rule is checked, trading partners can add child items while creating an invoice for blanket purchase orders or from a purchase order with limit order line items.

    SAP recommends this rule to be checked, because the blanket purchase order line could be very generic, and adding specific detail to that invoice is appreciated.

    To view this rule, ensure that the rule "Enable BPO-specific invoice" is "checked".

  • Allow suppliers to change the unit price.This image shows the Rule “Allow Suppliers to change the unit price”.

    Many blanket purchase order scenarios essentially represent a bucket of money focused only on the maximum total amount. If you do not allow trading partners to change the unit price, they will receive an error if the Invoiced amount is different than the blanket purchase order.

  • Allow suppliers to increase item quantities.This image shows the Rule “Allow Suppliers to increase item quantities”.

    SAP recommends to "check" the rule, because quantity is often irrelevant for blanket purchase orderinvoice lines (emphasis on max amount), and this restriction prevents submission of multiple invoices with quantity of 1 for those scenarios.

  • Allow suppliers to change line item descriptions when creating invoices for BPOs.This image shows the Rule “Allow Suppliers to change line item descriptions when creating Invoices for BPOs”.

    SAP recommends to "check" because the blanket purchase order line could be very generic and providing specific detail for that Invoice is appreciated.

  • Allow Ship To information in BPOs to be changed in invoices.This image shows the Rule “Allow Ship To information in BPOs to be changed in Invoices”.

    SAP recommends to "check" the rule, because it is possible a blanket purchase order could apply across many locations.

Service Entry Sheet Rules

When deciding on how to configure Service Entry Sheet rules, consider the following questions:

  • How does a Service Entry Sheet fit in your current procurement process? Is it mandatory, "nice to have", or not allowed/needed at all?
  • Are there existing workflows to be taken into consideration?
  • If Service Entry Sheets are in scope and required, SAP’s recommendation is to have the Network automatically generate the document from the Service Invoice submitted by the Trading Partner. This will allow the supplier to focus on the service Invoice and eliminate the need for them to manually submit the Service Entry Sheet.

Learn more about the rules you’ll want to consider for service entry sheets. You may move ahead to the next section if service entry sheets are not in scope.

  • Auto-generate service sheets from service invoices.This image shows the Rule “Auto-generate service sheets from service Invoices”.

    This rule will drive the network to automatically generate a service entry sheetwhen a trading partner creates a service invoice.

    If you "check" this rule, service entry sheet rules should be configured to match invoice rules as much as possible to allow for the seamless creation of the auto-generated service entry sheet. For example, if you allow and/or require invoice attachments, make sure the same rule is applied to service entry sheets.

    Note that this rule is located in the general invoice rules section of the SAP Business Network Buyer Account.

  • Do not allow suppliers to manually create service entry sheets for service orders.This image shows the rule Do not allow Suppliers to manually create service entry sheets for service orders.

    Ensure that this rule is "checked" when auto generated service entry sheets are in scope.

    If this rule is "checked", trading partners cannot create service sheets for service orders; the create service sheets button is disabled in the trading partner’s user interface.

    If this rule is "unchecked", trading partners can create service sheets for service orders; the create service sheets button is enabled in the supplier user interface.

Online Invoice Form Rules

These rules control the address fields on the invoice, which the trading partner may be able to modify. For example, you can allow trading partners to change the Ship To and Bill To information as shown on purchases orders, as well as enter default addresses which would appear in the invoice Bill To and Sold To fields for non-PO invoices.

If you will be transacting in EMEA region, SAP recommends to configure a list of customer Sold To addresses based upon VAT IDs, so that your trading partners can choose the correct VAT ID when creating invoices.

First you will click the link shown in the image.

This image shows the link Configure list of Customer (Sold To) Addresses with VAT IDs.

If you select an address and then "View/Edit" or "Create", a pop-up window will open to edit the buyer (sold to) address.

This image shows the pop up window where you can view or edit the Buyer (sold to) address.

Invoice Data Retention and Archival

SAP Business Network offers 3 separate options to store your invoices. Note that under regulations detailed at the country/region level, all invoices issued and received by enterprises or service providers acting in their name and on their behalf must be archived for a defined number of years at the end of the calendar year in which the invoice was issued. This archive period also applies to all electronic signatures, certificates, and verification protocols. Please read over each option carefully, especially if you are archiving for legal purposes.

  • Data Retention
    • Data retention services (directly on the SAP Business Network Buyer account) store all documents generated on the SAP Business Network in the US-based SAP Business Network database. All documents generated and received on the network will be stored on the network until the buyer’s contract expires.
  • Invoice Archival
    • SAP Business Network can archive your invoices in zip format. The zip files are not part of the data retention service and are deleted after three months. If you enable this feature, the SAP Business Network collects invoices generated in the network and stages them in a zip file for download, or sends them to a buyer defined URL. You can specify how often you want the network to archive your invoices. Based on the option you have selected. The network automatically waits for a 30-day period to collect all the corresponding invoice details before it can start archiving your invoices. If you do not want the network to wait for a 30-day period, then additionally select the "Archive Immediately" check box. It is recommended that you choose the "Archive Immediately" option if you are archiving for legal purposes, else you can choose any of the other archiving period option. You can download archived invoices from buyer account following the upper tab "Invoices" ﹥ "Archived Invoices" page.
  • Long Term Document Archiving
    • SAP Business Network offers a Long-term Archiving solution for tax invoices (no other documents). Buyers and trading partners in countries that do not have their own archiving process can leverage SAP Business Network’s electronic archiving process to archive their tax invoices. SAP Business Network partners with third party archive providers to facilitate electronic archiving of tax invoices and allow tax authorities to access, monitor, and retrieve the archived documents during a tax audit. In addition, users can download the archived tax invoices from the "Document Archive" page on the network.
    • To leverage the Invoice archiving process during tax auditing, SAP Business Network provides the Tax Auditor role. An auditor or a user with Tax Auditor role can view, access, and search invoices during a tax audit. The Download Archive Document link on the Invoice Details page allows the user to download archived invoices directly from the archive provider's portal. Trading partners and buyers can configure their account for long term invoice archiving. After the configuration, SAP Business Network automatically archives the latest Invoices and users can manually archive the older invoices.
    • Each country has a defined retention time for archived invoices. To learn more about e-archiving coverage, including retention period, physical archive storage location, and archive provider, click here.

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