Inter-company billing process

Posted by Karuna Ravuri in SAP ERP SD Billing on Jul 16, 2013 8:22:21 AM
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In normal business, we may decide to source our selling products from group companies to
cover excess demand, or to optimally use excess capacities of group plants. When we source
our selling product from a plant of another company within the group, we can use inter-
company billing and generate required documents for both selling company and supplying
company.
We assign plant of other company code to designated sales area (distribution channel for inter-
company sales) of our company code, and we can use standard SAP inter-company pricing for
the same. Here we can specify any special prices applicable via condition types IV01 & IV02.
There are condition types PI01/02 which serve as reference condition types for IV01/02.

IV01 & IV02 are used with subtotal 9 (gross value) and routine 22 (inter-company billing) as
shown below.



Now, we will look at two company codes 1002 & 3000. Go to IMG-->Sales & Distribution -->
Billing --> Intercompany Billing



First, we define order types for inter-company billing. Specify IV (standard billing document
type) in required sales document type inVOV8.
or IMG-->Sales & Distribution --> Billing --> Intercompany Billing --> Define order types for inter-
company billing


Here, I have assigned 2010 plant (company code 3000) to sales area 3031/71/00(company code
3000) for internal costing.


I have created a customer id (XD01) in 1002 and assigned the same to the sales organization of
1002. This customer id will be payer & represent 1002 for inter-company billing of plant. IMG--
>Sales & Distribution --> Billing --> IntercompanyBilling --> Define internal customer number by
sales org



Customer places an order on company code 1002. 1002 decides to deliver from plant 2010
belonging to company code (3000). I have created normal sales order and saved. Inventory
postings for the delivery are in plant 2010 & company code 3000. Further, two billing
documents are generated with reference to the same delivery document. Document flow is as
under:



First billing document created in company code 1002 and payer is customer.


Create second invoice with reference to the same delivery document number. This second
invoice is the inter-company billing document created in company code 3000 and here payer is
the first company (1002 here) for sales area 3031/71/00. Price (IV01) will be active for inter-co
bill where as PR00 will be active for customer bill.



Related accounting documents & excise documents can be generated as per pricing procedure
with reference to respective billing documents.


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http://scn.sap.com/community/erp/sd/billing/blog/2013/07/16/inter-company-billing-process


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In SAP sales & distribution module, an intercompany sales occurs when the selling
organization belongs to a different company code than the delivering plant. The
transaction path for accessing intercompany sales billing is:
IMG >> Sales and distribution >> Billing >> Intercompany billing
Let us take an example to understand intercompany sales better. Suppose there are
two company codes namely 1000 and 2000. A customer may place an order for goods
in sales organization belonging to company code 3000. However, the goods may be
manufactured by a delivering plant belonging the company code 1000. A sales order
is created indicating delivering plant of company code 1000. The sales organization
then invoices the customer for the materials purchased. SAP R/3 automatically creates
an intercompany billing document at the same time as the customers billing
document is created. This intercompany invoice is sent from the delivering plant to
the selling sales organization.
As a rule of thumb, when dealing with different company codes, one may find a need
to transfer stock between two different company codes. However, if the stock be
transferred within the same company code, there is no need for an intercompany
transaction. But in case the stock is transferred between different company codes, a
transfer of value occurs and is an intercompany sale.
---
In inter- company sales process, no PO will raise.
While creating sales order, if the end user knows there is no stock on their plant, they
request for their sister concern company to deliver these ordered goods to the
customer directly, after delivery they will receive intercompany invoice from the
delivering company code, thats the reason you enter delivering plant while creating
sales order.
Below is the inter-company check list:
Check all your settings once again for creating inter-company billing:
- Material should exist in both plants.
- Stock will be maintained in D-Plant (Delivering).
- Now Plant - R (Receiving) become the customer of Plant-D. So create a dummy
customer in Plant-D's company code and sales area.
- Assign this customer number to Plant -R's details & its selling sales area.
- Maintain the intercomapny billing type (IV) in ur sales doc type (OR).
- Assign the Plant-D to selling sales org+ dbt channel.
- Maintain relevant copy controls between documents.
- Determine pricing procedure for Standard (RVAA01) as well as Intercompany
(ICAA01)
(Note: Dummy customer's CPP, IV doc's DPP along with Delivering plant's sales
area)
- Maintain the condition records for Condition type PI01- VK11
(Note: In ICAA01, you won't find any PI01 Ctype, but you'll find IV01-, if you
observe the details of IV01 C.type in V/06, it has the ref Ctype as "PI01" , through
which the condition record of PI01 is shared to IV01 also..)
- Now create VA01, enter the required fields, in delivering plant -enter Plant-D, @
item level as well as @ header level, and save,
- Create Delivery VL01n, with ref to SO,
- Create Billing VF01 (with ref to DEL)--- observe bill type-F2,
- Create Billing VF01 (with ref to DEL again)--observe the bill type-IV.
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1111




INTERCOMPANY BILLING

Business case: - Customer orders goods to company code/Sales organization A
(Eg.4211/4211). Sales org 4211 will accept and punch the order in the system with
sold to party as end customer code in the system. Company code/sales org B
(Eg.4436) will deliver the goods to end customer and raise an inter-company billing
on 4211 with reference to delivery. This can happen only after 4211 raises invoice to
his end customer to whom the material has been delivered by 4436.
SPRO Customization required:-
1. Assign plant of delivering company code (Eg.SI81) to sales org/distribution
channel combination of ordering company code (Eg.4211/RT)
2. Maintain intercom any billing type as IV for sales document type OR
3. Assign Organizational Units By Plant (Eg.SI81/4211/RT/11)
4.Define Internal Customer Number By Sales Organization (Eg.4436 will create
customer master for 4211 company code and that number will be maintained in this
relationship:-4211/231)
5. Automatic posting to vendor account (Optional)
6. Maintain pricing procedure determination for 4211/RT/A/1/RVAA01-For customer
sales and billing
Maintain pricing procedure determination for 4436/RT/A/1/ICAA01-For inter-
company billing
Master data to be maintained:-
1. Create end customer master in company code/sales org 4211/RT/11
2. Create customer master for 4211 company code/sales org in 4436/RT/11
3. Maintain PR00 as price for end customer-Active in RVAA01
4. Maintain PI01 as price which has to be paid to 4436-Statistical in RVAA01
5. Maintain IV01 as inter-company Price-Active in ICAA01
Process:-
1. Create OR with sold to party as end customer.
2. Plant to be selected is delivering plant belonging to different company code. With
this selection system will treat this order as inter-company sales.
3. Pricing procedure is RVAA01
4. With reference to this order delivery will be created from the delivering plant and
post the goods issue for this delivery.
5. Ordering sales org will create billing document F2 with reference to delivery for
end customer.
6. Delivering sales org will create inter-company billing IV with reference to delivery
document.

A company arranges direct delivery of the goods to the customer from the stocks of
another company belonging to the same corporate group. To put in simple terms,
Company code A orders goods through its sales organization A from Plant B
belonging to Company code B. It is imperative that both Plants A & B should have
the material. In other words, the material is created for both the Plants A & B + their
respective storage locations.
Sales Organizations and Plants are uniquely assigned to Company codes. It is not
possible to assign either a plant or a sales organization to more than one company
code.
Sales organizations and plants assigned to each other need not belong to the same
company code.
In other terms, a plant belonging to Company code A & assigned to Sales
Organization A can also be assigned to Sales Organization B of Company Code B.
This enables cross company sales.
PARTIES INVOLVED
1) End Customer 2) Ordering Company code 3) Supplying Company Code.
End customer:
Customer who orders goods from the ordering company code.
Ordering Company Code:
Which orders goods from Plant belonging to Supplying Company code through its
sales organization and bills the end customer.
Supplying Company Code: Supplies goods from its plant to the end customer
specified by the ordering company code and bill the ordering company code.
CONFIGURATION SETTINGS
Assign Delivery Plant of the supplying company code to Sales Org + Distribution
channel of the Ordering company code in the Enterprise Structure.
DEFINE ORDER TYPES FOR INTERCOMPNY BILLING:
Menu path: IMG/ SD/Billing/Intercompany Billing/Define Order Types for
Intercompany billing
Assign Organizational units by Plant:
Menu Path: IMG/ SD/Billing/Intercompany Billing/Assign Organizational units by
Plant.
Define Internal Customer Number By Sales Organization:
Menu Path: IMG/ SD / Billing/ Intercompany Billing/ Define Internal Customer
Number By Sales Organization:
Creating / Showing Ordering Sales Organization as Internal Customer for Supplying
Company code:
Transaction Code: XD01
The ordering sales organization is represented as Internal customer of Supplying
company code.
We need to create customer master in Account Group Sold to Party and maintain
minimum required financial & Sales Area data.
This internal customer number has to be assigned to the ordering sales organization.
Hence, the system automatically picks up this Internal customer number whenever
there is Intercompany billing.
PRICING:
We need to maintain two pricing procedures RVAA01 & ICAA01. Pricing procedure
RVAA01 represents condition type PR00 & any other discounts or surcharges that are
meant for end customer.
We assign Pricing procedure RVAA01 to combination of Sales area (Of Ordering
company code) + Customer Pricing Procedure + Document Pricing Procedure of Sales
document type.
This pricing Procedure (RVAA01) is determined both at Sales Order level & Billing
processing for the end customer.
We maintain PR00 condition type to represent the ordering company codes price to
the end customer.
Condition records for PR00 are maintained using organizational elements of Ordering
company code, end customer & the Material.
Eg: Sales Org. of Ordering company code + End customer + Material.
We also need to maintain PI01 condition type to represent costs to Ordering company
code (in other words revenue to supplying company code). It is statistical condition
type & meant for information purpose only.
Condition records for PI01 are created with the following key combination:
Ordering sales Org + Supplying Plant + Material
Pricing Procedure ICAA01is determined at Intercompany billing processing level.
Pricing Procedure ICAA01 Pricing Procedure for Inter company billing is assigned
to the combination of:
1) Sales Area (of supplying company code) + Document pricing Procedure of Billing
document type IV + Customer Pricing Procedure of the Internal customer.
Pricing Procedure ICAA01 has condition type IV01 that represents revenues for
Supplying company code in the intercompany billing.
PR00 condition type also appears in Intercompany billing document. It is for
information purposes only and does not have bearing on the value of the document.
PI01 represented under pricing procedure RVAA01 is reference condition type for
IV01 and the same is defined in the condition type IV01. Due to this these two
condition types represent same value.
The condition type IV01 in intercompany billing document represents revenue to the
Supplying Company. But its corresponding condition type PI01 in the billing
document to the end customer is shown as a statistical item meant for information
purposes.
Condition Type VPRS in the intercompany-billing document indicates cost to the
supplying company code.
The use of two different condition types in Intercompany billing is necessary to
ensure that data is transmitted correctly to the financial statement (Component CO-
PA).