Rebates with accruals
Hello all,
on my current project we are using rebates via subsequent settlement (credit side only). The finance team insists on having monthly accruals -i.e. an accrual for each goods receipt, which was accomodated by checking off the accrual indicator on the A200 condition. Everyone on the MM team is uneasy about this, since it basically emulates a discount rather than an end of period rebate.
Has anyone seen this done before and if so, can you shed some light or words of wisdom on why not to do this? Or provide some examples of the problems you encountered?
I sense that any renegotiated rates, over or under attained amounts, or other deviations from the agreed quantities will create problems reconciling the balance sheet entries.
Thanks in advance for any insight.
Why not just do a partial (or even interim) settlement at the end of each period? Provided your arrangement calander is set up for monthly periods, you simply partially settle the rebate each month. This generates a billing document that can be sent to the (customer entity of the) vendor for payment. When you perform final settlement at the end of the financial year/rebate period, the system will automatically verify the amounts already claimed against the period specific conditions. It then evaluates the entire arrangement against the main condition and compares this to the amounts already claimed. Any difference is then created as a billing document (or credit memo) and the arrangement is closed.
Hope that helps...
OzSapMan