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Course Agenda
Credit Management Overview Credit Master Credit Reporting Credit Blocked/Released
Credit Management
Ability to track offline activities on an account Ability to track amount of credit used and flag system when customer is breaching the limit Ability to carry out credit checks across multiple company codes per credit control Area Ability to create risk categories for customers that perform different risk analysis, per category Ability to exclude disputed items from credit check
Credit Management
Evaluate customers credit worthiness to assign a credit limit and risk category
Identify early warning signs of customers ability to pay Enhance the credit-related decision-making process Determine if credit-blocked Sales Orders should be released or cancelled
The off-line process of analyzing a credit risk remains unchanged The difference is the new system and tools available to the Credit Analyst
Activities involved in performing credit and risk assessments on McCain customers include the following:
Collect customer credit information Review customer financial statements Evaluate customer credit information Determine the risk Extend or Refuse Credit Determine credit limit and risk category Release or cancel credit-blocked orders
In SAP, the Credit Management process integrates the Order Management Accounts Receivable (A/R) process in the SD and FI Modules respectively.
Availability Checking
Order Entry
Pricing Execution
Order Fulfillment
Credit Checking
During order entry, the system performs an automatic credit check. The credit monitoring process is displayed below.
Yes
Credit Exposure
Open Orders
Open Deliveries
Open Items
Credit Exposure
Course Agenda
Credit Management Overview Credit Master Credit Reporting Credit Blocked/Released
Credit Limit Maximum limit of receivables (and foreseeable receivables) that McCain will allow for this customer Credit Account Customer # the system uses to monitor the credit limit (this # can be different than the Customer # above) Credit Limit Used Portion of the Credit Exposure for the credit limit given Credit Horizon Date Future Date that defines the credit horizon. All sales orders between the current date and the future horizon date will be subject to automatic credit check
Name
Customer Credit Management Change Customer Credit Management Display
Description
Enter credit and risk management master data for existing customer Display customer credit master data
FDK43
FD24
Instructor Demonstration
Change Customer Credit Master Data (FD32)
Scenario: Change the credit master of a new customer so that the appropriate credit limit and other attributes are assigned to the customer.
Course Agenda
Credit Management Overview Credit Master Credit Reporting Credit Blocked/Released
FBL5N
S_ALR_87012168
Aging Report
Instructor Demonstration
Display Customer Credit Overview (F.31)
Scenario: Review the credit exposure of a customer.
Instructor Demonstration
Early Warning List (FCV3)
Scenario: Review the customer credit accounts that are close to triggering a credit block.
Instructor Demonstration
Display Customer Credit Master Sheet (S_ALR_87012218)
Scenario: Review the credit exposure of a customer.
Instructor Demonstration
Customer Open Item Analysis by Balance of Overdue Items (S_ALR_87012178)
Instructor Demonstration
Customer Line Item Display (FBL5N)
Instructor Demonstration
Due Date Analysis for Open Items (S_ALR_87012168)
Course Agenda
Credit Management Overview Credit Master Credit Reporting Credit Blocked/Released
Name
Blocked SD Documents Released SD Documents Process Blocked Sales Documents
Description
Release or Not Release credit blocked Order Retrieve a list of Credit-Released Orders Credit Analyst views all blocked sales documents due to credit check failure and makes decisions whether the blocked Order can be released despite unavailability of credit limit. Credit Analyst can select orders that need to be released and then release them collectively or individually.
VKM4
Instructor Demonstration
VKM1 - Release Credit Block on an Order
Scenario: Release the credit block for a customer who has exceeded the credit limit.
Instructor Demonstration
VKM2 Re-block a Credit Released Order
Scenario: An order has been Credit Released but events take place that require the credit analyst to put that order back on Credit Hold
Questions?
Appendix
Appendix
NOTE:
The following slides are optional they may be reviewed on an ad-hoc basis, or printed and posted on the classroom wall for reference during the training session.
Term
Blocked Order Credit Limit Customer Risk Category Sales Order
Description
An order that has been stopped from further processing until the block is removed The maximum amount granted to a customer as credit A business partner with whom a business relationship exists; customers are also involved in the issue of goods or services A code used to classify customers according to commercial risk A customer request that is sent to the company for delivery of goods or services at a certain time; the request is received by the sales area responsible for fulfilling the Order
Term
Credit Control Area Credit Master File Credit Account Credit Risk Category
Description
Highest organizational entity in Credit Management and provides guidelines; specifies, checks, and monitors credit limits for customers The customer credit account that holds credit related data for each credit account customer Organizational entity representing the highest level at which credit exposure is monitored and where Orders are subject to credit checking The credit risk category (automatic credit control) holds the business decision process and data on whether to release new orders for shipment or to block them
Role
Accounts Receivable (A/R) Credit Specialist
Responsibility
An A/R Credit Specialist analyzes a new customers credit worthiness and proposes credit limits, performs credit reviews of existing customers, and recommends changes in maintaining credit accounts. The A/R Credit Specialist also monitors news about customers and makes recommendations about changes to their credit accounts A Credit Manager approves changes to Customer Credit Accounts and approves Customer Credit Limits
Credit Manager