Credit and Risk Management in SAP SD Module | PDF study material


Outstanding or uncollectible receivables can spoil the success of the company greatly. Credit Management enables you to minimize the credit risk yourself by specifying a specific credit limit for your customers. Thus you can take the financial pulse of a customer or group of customers, identify early warning signs, and enhance your credit-related decision-making. This is particularly useful if your customers are in financially unstable industries or companies, or if you conduct business with countries that are politically unstable or that employ a restrictive exchange rate policy.

If you are using the Accounts Receivable (FI-AR) component to manage your accounting and an external system for sales processing, Credit Management enables you to issue a credit limit for each customer. Every time you post an invoice (created in FI-AR), the system then cheks whether the invoice amount exceeds the credit limit. Information functions such as the sales summary or early warning list help you to monitor the customer’s credit situation. If you are using both the Accounts Receivable (FI-AR) component to manage your accounting and the Sales and Distribution (SD) component for sales processing, you can also use Credit Management to issue credit limits for your customers. You can make settings in Customizing to decide the scope of the check and at what stage in the process (for example, order entry,delivery or goods issue) a credit limit should take place. General information functions are also available for use with credit checks.

Credit and Risk Management (SD-BF-CM).5
Monitoring Credit During Sales and Distribution Processing …………………………………………… 7
Credit Control Area ……..11
Deriving the Credit Control Area …………………………………..15
Specifying Credit Limits by Credit Control Area…………….17
Creating Credit Data…….18
Credit Limits for Groups of Customers ………..……………….21
Defining Credit Limits for New Customers…………………….22
Processing Credit Data..23
Displaying Credit Data …24
Resetting Credit Limits ..25
Sales and Distribution Functions in Credit Management .26
Sources of Information in Credit Management ………………27
Credit Management in Distributed Systems…………………..30
Reports for Credit Management…………………………………….32
Postings Without Credit Limit Checks…………………………..34
Authorizations for Critical Credit Control Fields ……………36
Automatic Credit Controls in SD …………………………………..37
Defining an Automated Credit Check…………………………….38
Different Types of Credit Checks…………………………………..40
Subsequent Functions in Credit Checks ……………………….42
Reviewing and Releasing Credit Holds………………………….43
Work Lists for Credit Management ………………………………44
Creating Work Lists for Credit Management……………..46
Informing Credit Representatives Automatically……………48
Authorizations …………….49
Risk Management for Receivables in SD……………………….50
Forms of Payment Guarantee ……………………………………….52
Determining the Form of Payment Guarantee………………..55
Calculating the Credit Value………………………………………….57
Settings for Credit Management and Risk Management: Overview …………………………………58
Definitions………………….61
Credit Limit…………………62
Risk Category ……………..63
Credit Representative Group ………………………………………..64
Date of Next Review…….65
Text ……………………………66
Blocked………………………67
External Credit Data …….68
Customer Credit Group .69

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