03 - Rebates in SAP - C

SAP Rebate Processing Overview
March ,30th,
2010
Index
Definition
Processing Overview
Prerequisite For Rebate Processing
Rebate Agreement Details
Rebate Agreement Type
Rebate Agreement Examples
Material For Settlement
Accruals
Rebate Relevant Billing Document Processing
Settling Rebate Documents
Making changes after final settlement
Additional Features
Definition
A rebate is a discount, which is granted subsequently to a rebate

recipient on the basis of a defined sales volume within a certain
period
Rebates are different from other discounts in that they are based
on the sales volume generated by the customer within a specified
period and are paid retrospectively
Rebate agreements are created to determine the values required
for a rebate settlement within the validity period of the rebate
agreement
Processing Overview
A settlement run creates the required credit memo request

automatically when the rebate-relevant billing documents are
processed
Accruals can be determined and posted automatically and rebate
credit memo then reverses these accruals, if desired
Prerequisite for Rebate Processing
The sales organization in which sales orders are processed must

be relevant for rebate processing
The payer must be relevant for rebate processing. Whether a
customer can receive rebates can be indicated by marking the
Rebates field in the Billing view of the customer master record.
The billing type (invoice, credit memo, and so on) must be relevant
for rebate processing
Rebate Agreement
Details of rebate are defined in a rebate agreement. For e.g.

following things are specified in rebate agreement
Who receives the rebate payment

Validity period
On what criteria the rebate is based (customer, customer and material, and so on)
Currency (default from the sales organization)
Method of payment (check, bank transfer, and so on)
Rebate Agreement
Condition records are linked to the rebate agreement specifying

the rebate rate and the accrual rate. With the rebate agreement,
following things can be specified
The condition types used with this rebate agreement type
A validity period proposal
The rebate agreement is created with reference to a rebate

agreement type
The features of each rebate agreement type are set in Customizing
and Rebate agreement type can be set to specify the default
parameters so that system automatically proposes it in
corresponding rebate agreement
For example, the system can propose
Which condition types you can use in an agreement

Which validity period the system automatically proposes for an agreement
Which status is required before an agreement can be processed for payment.
Which rebate agreement types are defined in Customizing for Sales and
Distribution.

Agreement type
Basis of rebate
Condition type
0001
Customer/Material
(% rebate)
BO01
Customer/Rebate
Group (% rebate)
BO01
0002
Customer/Material
(quantity dependent)
BO02
003
Customer
(% rebate)
BO03
004
Customer Hierarchy
(% rebate)
BO04
Cust.
Hierarchy/Material
(% rebate)
BO04
Sales volume
independent
BO05
005
Rebate Agreement - Example
Rebate based on customer Certain customer gets 1% rebate on all

material ordered
Rebate based on material For material X ordered, 1% on item
value OR 10$ per piece
Rebate based on customer hierarchy - Certain customers get a 1%
rebate on all materials they or their subsidiaries buy. The subsidiaries
must be linked to the rebate recipient within a customer hierarchy
Rebate based on group of materials - A rebate group consists of
materials which are applicable for same rebate. Material is assigned
to rebate group in material master
10
Material for Settlement
System needs to refer to a material for settlement in case of rebates

which are material independent for e.g. based on customer, customer
hierarchy or group of materials.
System uses this material when rebate is paid using a credit memo
as it provides important material master data such as account
assignment and tax determination etc
In this case special materials master need to be created for this
material for settlement
It does not matter which material type and material application type is
used to create settlement materials however in order to avoid
settlement materials appearing in reports and selections for standard
material a new material type can be created.
System automatically asks to enter material for settlement when
condition record is created for relevant rebate agreements
11
Accruals
Rebate accruals allow accounting department to keep track of how

much your company owes customers with whom you have rebate
agreements
Accrual rate can be entered in condition records based on sales
volume for e.g. accrual rate USD 2.00 for every 10 pieces the
customer orders OR accrual rate can be entered not based on sales
volume for e.g. lump sum payment of USD 5000
Every time a rebate-relevant billing document (an invoice, a credit or
debit memo) is processed, the system automatically posts an accrual
to financial accounting (FI)
Within FI, the rebate accrual is posted to two accounts: a sales
deduction account and an accrual account
Accruals can also be posted manually and time and amount can be
controlled
12
Rebate Relevant Billing Document Processing
Rebate processing beings by creating a rebate-relevant billing

document
System posts an accrual to financial accounting as soon as the rebaterelevant billing document is released to accounting
At the same time, the system updates the rebate basis and the accrual
amount in the rebate agreement sales volume screen
13
Settling Rebate Documents
Rebate agreement can be settled partially or fully

System uses the services rendered date (billing date) to determine
whether a billing document qualifies for rebate processing i.e. to
qualify; the date must fall within the validity period of one or more
rebate agreements.
When Final settlement is carried system automatically
Calculates the rebate based on the sales volume statistics
Deducts any previously paid rebates
Then it creates credit memo request, and proposes the end date of
the agreement validity period as the billing date
Credit memo request is automatically blocked for billing and final
credit memo can be created after it is approved and billing block is
removed
Final settlement can be carries out automatically, manually or as a
background task
14
Making Changes after Final Settlement
If the credit memo has not yet been created

You can change the amount in the credit memo request
You can delete the credit memo request, rebate agreement is re-opened and you
can change it as required and perform final settlement again
If the credit memo has been created but not yet forwarded to
Financial Accounting
You can change the amount in the credit memo
Cancel credit memo, make a copy of existing rebate agreement, change the copy
and perform final settlement of new agreement
If the credit memo has been created and forwarded to Financial

Accounting
You must cancel the credit memo
For minor changes, change credit memo request and create new credit memo
For major changes, Cancel credit memo, make a copy of existing rebate
agreement, change the copy and perform final settlement of new agreement
15
Additional Features
Listing Rebate Agreements

Rebate wok-list report is available based on selection criteria of Agreement
number, Rebate recipient, Organizational data and Status
Rebate work-list can be used to perform tasks of Releasing specific agreements
for settlement, Displaying the verification level of an agreement, Selecting a
specific agreement and if the status allows it making changes
Displaying Payment History in Rebates

Payment history can be displayed for Final settlement, Partial settlement,
Statistics corrections and Manual accrual postings
When you choose an option, the system will list all credit memos for the rebate
agreement, open credit memo requests, all cancellation documents for credit
memos
Retroactive Rebate Agreements - Retroactive rebate agreements

allow you to take into account billing documents created before the
rebate agreement is created
16
Additional Features
Partial Settlement Rebate Agreement scan also be partially settled

during the validity period and payment amount can be
Limited to the cumulative accruals of the condition record
Limited to the amount that would be paid if final settlement were presently carried
out
Unlimited
17

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How is a rebate defined and what are the differences between rebates and other discounts?

How is a rebate defined and what are the differences between rebates and other discounts?

What are the prerequisites for rebate processing?

What are the prerequisites for rebate processing?

SAP Rebate Processing Overview

A rebate is a discount, which is granted subsequently to a rebate

A settlement run creates the required credit memo request

Prerequisite for Rebate Processing

The sales organization in which sales orders are processed must

Details of rebate are defined in a rebate agreement. For e.g.

Who receives the rebate payment

Condition records are linked to the rebate agreement specifying

Rebate Agreement Type

The rebate agreement is created with reference to a rebate

Which condition types you can use in an agreement

Rebate Agreement Type

Rebate Agreement - Example

Rebate based on customer Certain customer gets 1% rebate on all

Material for Settlement

System needs to refer to a material for settlement in case of rebates

Rebate accruals allow accounting department to keep track of how

Rebate Relevant Billing Document Processing

Rebate processing beings by creating a rebate-relevant billing

Settling Rebate Documents

Rebate agreement can be settled partially or fully

Making Changes after Final Settlement

If the credit memo has not yet been created

If the credit memo has been created and forwarded to Financial

Listing Rebate Agreements

Displaying Payment History in Rebates

Retroactive Rebate Agreements - Retroactive rebate agreements

Partial Settlement Rebate Agreement scan also be partially settled

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