Working with Settlement Management

Objectives

After completing this lesson, you will be able to:

  • Use Condition Contract Management (CCM)

Rebate Processing using Condition Contract Management (CCM)

Introduction

The traditional SAP ERP rebate solution is explained.

The (traditional) SAP ERP rebate solution uses a rebate index table (VBOX). Use of this table presents the following challenges:

  • Size: The rebate index table can sometimes contain thousands or even millions of entries in the SAP ERP system. An example is a customer system where the table contained 1TB of data with a total database size of 5TB.
  • Locks: If changes to a customer’s conditions need to be maintained in the system, the rebate index table needs to be rebuilt. While this rebuild is taking place, all rebate data is locked for everyone in the entire organization.

The Settlement Management functionality which is part of SAP S/4HANA aims to tackle these challenges.

The table VBOX itself is no longer used in SAP S/4HANA because in SAP S/4HANA, rebate conditions are applied instantly. This means that there is no need for a rebate index table that needs rebuilding when new customers become eligible for rebates or conditions change. Eliminating this table significantly reduces the data footprint of the system.

Settlement Management contains functionality known as Condition Contract Management (CCM). This functionality replaces traditional rebate processing in SAP S/4HANA.

Note
SAP TPM (Trade Promotion Management) is also integrated with CCM. There are special settings in the SAP S/4HANA system for this integration of Condition Contract Management with Trade Promotion Management (TPM). The four condition contract types 0ST1 to 0ST4 correspond to the condition contract types 0S01 and 0S02 for the taxation as a service. The standard delivery does not contain settings for the TPM integration in connection with goods-related taxation, as they can easily be derived from the settings for 0SG1 and 0SG2 and 0ST1 to 0ST4.
Condition Contract Management in Settlement Management in SAP S/4HANA is shown.

Condition Contract Management (CCM) allows for the storage of agreements between the various business partners involved in a certain process. A condition contract contains important information such as prices, conditions, and the validity of the agreement. It forms the basis for settling claims or rebates with suppliers or payables to customers. Furthermore, the condition contract can be used to handle pricing conditions only for the order to cash or the procure to pay process.

General Process for Condition Contract Management (CCM)

The general process in CCM differs from traditional SAP ERP rebate processing in that the process does not start with the creation of a rebate agreement. Instead, there are (types of) condition contracts that are created and released. A condition contract combines all information relevant to a certain agreement such as the condition granter or owner of the condition contract, the list of eligible partners, and special conditions such as discounts or prices. It can be used to grant discounts for meeting quantity or value targets for sales or purchasing volumes. An enhancement in the system for pricing ensures that the system only finds the relevant conditions for the eligible partners listed in the condition contract.

The conditions to be processed in the condition contract are stored in Customizing in condition tables. Any condition table that is required can be assigned in Customizing. If the eligible partner is used, or if there is a need to have multiple condition records in parallel, for example, in case of a rebate, the condition contract number needs to be in the access sequence and in the condition table. This number is used to ensure that the conditions are granted only to the eligible partners of the condition contract.

Condition Contract Management Configuration

Note
See the following video to learn more about the configuration of Condition Contract Management (CCM):

The following figure summarizes the configuration of Condition Contact Management (CCM):

Characteristics of using a settlement program are discussed.
Note
See SAP note 2535889 - CCM - Description of delivered configuration for details about the standard configuration of CCM that SAP delivers.

Condition Types RES1 and REA1/RED1

The condition types for which records are maintained in condition contract maintenance are called RES1 (for Rebate) and REA1 (for Rebate Accruals).

Condition types RES1 and REA1 and some of their characteristics are shown.
  • Condition type RES1 Rebate:

    Condition type RES1 is used in a condition contract to maintain rebate conditions for a sales rebate scenario. This condition type uses SAP standard access sequence RE01 Sales Rebate. It is set up as a discount. However you are going to create a credit memo with it, so you have to set the field Plus/Minus as positive (/plus). The calculation type for this condition type is A (Percentage).

    Within standard pricing procedure A10005, base formula 214 is present (in column Alt.Cond.Base Value). This formula controls that, in case of a fix amount rebate condition, the condition base value is positive (see formula documentation). The account number for the posting in SAP S/4HANA Finance is determined using account key 0S1. The calculated value is stored as a subtotal.

  • Condition type REA1 Rebate Accruals:

    Condition type REA1 is used in a condition contract to maintain accruals conditions for a sales rebate scenario. Therefore, the Accruals indicator is selected in the Control Data 2 group of fields in the configuration of the condition type. This condition type uses the SAP standard access sequence REA1. The field Plus/Minus is set as negative (/minus) for condition type REA1 as it represents the opposite amount of the amount posted as a rebate. The calculation type for this condition type is again set as A (Percentage). During settlement, posted accruals are dissolved again.

  • Condition type RED1 Rebate Accruals:

    RED1 is used in a settlement run to determine the accruals amount for delta accruals (pricing procedure A10006). It is not an accruals condition type itself (this means that the Accruals indicator in the Control Data 2 group of fields in the configuration of the condition type is not selected), but it uses the accruals condition type REA1 as a reference. Such a condition type is required in the pricing procedure since accruals conditions are not considered in the net amount determination. The net amount is used for the accruals update. RES1 Rebate and REA1 Rebate Accruals are the condition types for which condition records are maintained in condition contract maintenance.

For more information on the configuration of Condition Contract Management (CCM) please also refer to SAP's help portal which can be found using http://help.sap.com. In the Search all field enter Condition Contract Management and select the entry called Condition Contract Management - Sales Rebate Processing.

Note
RES3 Rebate TPM and REA3 Rebate TPM Accruals are the corresponding condition types for the integration of CCM and TPM. For more details about condition contract settlement, see SAP course S4620: Pricing in SAP S/4HANA Sales.

Create and Use a Condition Contract

Part 1 of the exercise/simulation:

Part 2 of the exercise/simulation:

Check Configuration Settings for Condition Contract Management (CCM)

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