Hi there. Welcome to the SAP S4 financial Accounts receivable and payable course.
This is the second lesson on preliminary knowledge. We will talk about business partner master data and abbreviate it as BP.
In this lesson we discuss BP grouping, BP role, different levels of BP master data, and important fields.
BP is a new concept introduced in SAP S/4HANA that consolidates vendor, customer, and employee master data into one central object.
BP includes every legal entity or natural person having a business relationship with the company.
BP Grouping:
- Categorizes BPs (vendors, customers, financial partners, employees, etc.)
- Controls number range assignment
- Supports internal (automatic) and external (manual) numbering
Transaction Used:
T-Code: BP
Fiori App: Maintain Business Partner
Creation Scenarios:
1. Internal Numbering – System automatically assigns BP number.
2. External Numbering – User manually assigns BP number (example: CN10).
BP Role:
- Defines relationship type (Vendor, Customer, Both)
- Each role has specific required master data.
- One BP can have multiple roles.
Vendor Roles:
- FLVN01 (Supplier – Purchasing Data)
- FLVN00 (FI Vendor – Company Code Data)
Customer Role:
- FLCU00 (FI Customer)
Data Levels:
1. General Data (Client Level – Name, Address, Bank details)
2. Organizational Level:
- Purchasing Organization (Supplier)
- Company Code (FI Vendor/Customer)
- Sales Organization (Customer)
Important Fields (Vendor – FI Level):
- Reconciliation Account
- Payment Terms
- Payment Methods
- House Bank
- Tolerance Group
- Duplicate Invoice Check
Payment Logic:
- Payment terms copied during invoice posting.
- Automatic payment run selects invoices based on due date.
- Cash discount applied if paid within discount period.
Customer-Vendor Integration:
- Same BP can be both vendor and customer.
- Supplier field in customer role and Customer field in vendor role must be maintained.
- Enables combined reporting.
Posting Keys:
- 01–19 → Customer postings
- 21–39 → Vendor postings
Summary:
BP grouping determines number range.
BP roles determine master data requirements.
BP supports multiple organizational levels.
Business Partner is the central master data object in SAP S/4HANA for AR and AP.
SAP S/4HANA – Accounts Payable Process (Standard AP Process)
Welcome to the SAP S/4HANA Financial Accounts Receivable and Payable course.
This lesson introduces the standard Accounts Payable (AP) process.
Topics Covered:
- Purchase to Pay (P2P) workflow
- Three-Way Match concept
- Logistics Invoice vs Financial Invoice
- Invoice and Credit Memo Entry
Purchase to Pay Workflow:
1. Purchase Requisition
2. Purchase Order (PO)
3. Goods Receipt (GR)
4. Vendor Invoice
5. Three-Way Match Validation
Three-Way Match:
- PO vs Goods Receipt vs Vendor Invoice
- Invoice Quantity vs GR Quantity Check
- Invoice Price vs PO Price Check
- Tolerance Limits
- Payment Block if variance exceeds limit
Logistics Invoice:
T-Code: MIRO
Fiori App: Create Supplier Invoice – Advanced
Accounting Entries:
At Goods Receipt:
Dr Inventory / Expense
Cr GR/IR
At Invoice Posting:
Dr GR/IR
Cr Accounts Payable
Transaction Types in MIRO:
- Invoice
- Credit Memo
- Subsequent Debit
- Subsequent Credit
Key Tabs in MIRO:
- Header (Invoice Date, Reference, Tax Code, Gross Amount)
- Payment Tab (Baseline Date, Payment Terms, Discount, Method)
- Details (Unplanned Delivery Costs)
- Simulation before posting
Important Fields:
- Tax Code
- Automatic Tax Calculation
- Unplanned Delivery Costs
- Baseline Date
- Payment Terms
Document Flow:
PO → GR → Invoice → Accounting Document
Financial Invoice:
T-Code: FB60
Fiori App: Create Incoming Invoice
Characteristics:
- No Purchase Order
- Direct GL Account Entry
- Vendor Field Mandatory
- No Three-Way Match
- Relies on offline approval
Accounting Entry:
Dr Expense GL
Cr Accounts Payable
Difference Between Logistics & Financial Invoice:
- Logistics Invoice Document Type: RE
- Financial Invoice Document Type: KR
- Logistics Invoice uses GR/IR account
- Financial Invoice posts directly to GL
Best Practice:
“No PO, No Pay” policy
Use third-party tools (e.g., OpenText VIM) for approval workflow.
Conclusion:
- Three-Way Match is core control in AP.
- Logistics invoices provide stronger internal control.
- Financial invoices provide flexibility.
- Practice in test system recommended.
SAP S/4HANA – Accounts Receivable Process (Standard AR Process)
This lesson covers the standard Accounts Receivable (AR) process.
Topics Covered:
- Sales to Cash (S2C) Process
- Accounting Postings during Shipping and Billing
- Logistics vs Financial Customer Invoices
- Credit Memos
- SAP Credit Management
Sales to Cash Workflow:
1. Customer Purchase Order
2. Sales Order Creation
3. Credit Check
4. Picking & Shipping
5. Goods Issue Posting
6. Billing (Sales Invoice)
7. Accounting Document Generation
Financial Postings During Shipping:
Dr Cost of Goods Sold (COGS)
Cr Finished Goods Inventory
Financial Postings During Billing:
Dr Accounts Receivable
Cr Revenue
Cr Output Tax
Key Tool:
Fiori App: Display Document Flow
- Shows complete document chain (Sales Order → Delivery → Billing → Accounting Document)
- Top section: Logistics documents
- Bottom section: Financial documents
Logistics Customer Invoice:
- Triggered from Sales Process
- Document Type: RV
- Revenue account determined automatically
- Profit Center derived from Material Master
- Posting Key for Customer: 01
Financial Customer Invoice:
T-Code: FB70
Fiori App: Create Outgoing Invoices
- No Sales Order reference
- Revenue GL entered manually
- Document Type: DR
- Direct AR posting
Accounting Entry (Financial Invoice):
Dr Accounts Receivable
Cr Revenue
Cr Output Tax
Credit Memos:
- Logistics Credit Memo: Triggered from Sales Module
- Financial Credit Memo: Posted via FB70 (select Credit Memo)
- Reduces Accounts Receivable
- Posting direction reversed
Month-End Control:
- Finance checks missing billing documents
- AR & GL team post Sales Accruals if required
SAP Credit Management:
Purpose:
- Limit credit risk and bad debts
- Control shipments based on customer credit limit
Configuration Location:
Transaction Code: BP
Role: SAP Credit Management
Credit Structure:
1. Main Credit Segment (Overall Credit Pool)
2. Sub Credit Segments (Usually Company Code specific)
Example:
Main Limit: €50,000
Company Code 1010 Limit: €60,000
Credit Check Logic:
- Both Main and Segment limits checked
- System blocks further shipments if limit exceeded
- Does NOT block invoice posting
Important Concept:
Credit Management blocks Logistics (Shipping), not Accounting posting.
Advanced Features:
- External credit rating integration
- Formula-based limit calculation
- Custom credit limit update programs
Conclusion:
- AR mainly reviews accounting documents.
- Logistics postings are automatic.
- Financial invoices mirror AP logic.
- Credit Management protects against bad debt risk.
SAP S/4HANA – Accounts Receivable Payment Process
This lesson covers customer payment processes in Accounts Receivable.
Topics Covered:
- Customer Down Payment Requests
- Manual Incoming Payments
- Post on Account
- Partial Receipts
- Residual Items
- Minor Payment Differences
Customer Down Payment:
Transaction:
Fiori App: Manage Customer Down Payment Request
GUI T-Code: F-37
Key Points:
- Similar to Vendor Down Payment
- Document Type: DS (Incoming Payment Request)
- Noted Item (No FI Posting)
- Posting Key: 09
- Special G/L Indicator: F
Manual Incoming Payments:
Fiori App: Post Incoming Payments
GUI T-Code: F-28
Process:
1. Enter Company Code & Header Data
2. Enter Customer Number
3. Click "Propose Items"
4. Select Open Items
5. Enter Payment Amount
6. Simulate and Post
Special Option:
- Select "Special Transactions" to display Down Payment Requests.
Post on Account:
Used when:
- Payment received but invoice unknown.
- Creates open credit on customer account.
- Cleared later manually.
Partial Receipts:
Scenario:
Customer pays less than invoice amount.
Example:
Invoice: €1,501.50
Payment received: €1,000
Steps:
- Select invoice
- Adjust allocated amount to actual payment
- Post
- Remaining balance stays open
Important:
- SAP keeps original invoice open with full due date.
- Payment posted as separate linked item.
Residual Item Handling:
If additional payment received (e.g., €401.50):
Steps:
- Select open items
- Enable Residual Amount & Reason Code
- Enter remaining difference (e.g., €100)
- Choose Reason Code (e.g., 057 – Customer Miscalculation)
- Post
System Posting:
- Clears original invoice
- Creates new open residual item
- Posting Key: 06 (Payment Difference)
Minor Payment Differences:
Example:
Invoice: €100
Payment: €99.50
Difference: €0.50
System Action:
- Automatically posts difference to configured P&L account
- Used for small rounding differences
Key Concepts:
1. Down Payment Request = Noted Item (No FI posting)
2. Manual Receipt = F-28
3. Post on Account = Temporary open credit
4. Partial Payment = Invoice remains open
5. Residual Item = New smaller open balance
6. Minor Difference = Auto write-off to variance account
Conclusion:
- Customer payments can be handled flexibly.
- SAP preserves invoice due dates.
- Residual and partial handling ensures proper audit trail.
- Minor differences are automatically posted to configured accounts.
SAP S/4HANA – AR & AP Reporting (Lesson 9)
This lesson focuses on reports and month-end tasks related to Accounts Receivable (AR) and Accounts Payable (AP).
Topics Covered:
- AR & AP Overview Reports
- Line Item Reports
- Balance Reports
- Aging Analysis
1. AR Overview Report
Fiori App: Accounts Receivable Overview
- Dashboard style layout
- Filters on top, data cards below
- Save filter variants (Save As)
- Set as default / Public / Auto-Apply options
- Manage Cards (add/remove/rearrange)
- Save as Tile for quick access
2. AP Overview Report
Fiori App: Accounts Payable Overview
- Similar to AR Overview
- More data cards available
- Same filter and tile functionality
3. Supplier Line Item Report
Fiori App: Manage Supplier Line Items
- Filter by Open / Cleared / All Items
- Normal Items (Invoices, Credit Memos, Payments)
- Special G/L Transactions (Down Payments)
- Noted Items (Down Payment Requests)
- Parked Items (Draft postings)
- Adapt Filters to add more fields
- Save Layout (column structure)
- Export to Excel
- Bulk Edit (Baseline Date, Payment Block, Payment Method)
4. Customer Line Item Report
Fiori App: Manage Customer Line Items
- Similar to Supplier Line Items
- Additional button: Block Dunning
5. Supplier Balance Report
Fiori App: Display Supplier Balances
GUI T-Code: FBL1N (line items), F.10N equivalent for balances
- Monthly debit/credit totals
- Accumulated balances
- Drill-down to line items by clicking amounts
6. Customer Balance Report
Fiori App: Display Customer Balances
- Similar structure to Supplier Balance Report
- Drill-down functionality
7. Accounts Payable Aging Analysis
Fiori App: Aging Analysis
- 30-day bucket structure (0–30, 31–60, 61–90, 90+)
- Drill-down by supplier
- Change chart type
- Toggle legend and measures
- Tabular view required before Excel download
- Filters include Company Code selection
8. Accounts Receivable Aging
Fiori App: Doubtful Accounts Valuation
- Shows overdue items
- Displays impairment calculation
- Mixed chart and table view
- Shows allowance % and overdue duration
Key Concepts:
- Save report layouts and filter variants
- Use drill-down for detail analysis
- Aging analysis supports credit risk monitoring
- Doubtful accounts valuation supports impairment calculation
- Line item and balance reports support reconciliation
Conclusion:
These reports cover most operational and month-end reporting needs in AR and AP, including dashboards, detailed analysis, reconciliation, and aging control.
SAP S/4HANA – AR & AP Period-End Activities (Final Lesson)
This lesson covers key month-end closing activities for Accounts Receivable (AR) and Accounts Payable (AP).
Categories Covered:
1. Clearing
2. Dunning
3. Balance Adjustments
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1. Clearing Open Items
Automatic Clearing:
Fiori App: Clear Open Items Automatically
GUI T-Code: F.13
- Select Company Code, Fiscal Year
- Enter Clearing Date (usually month-end)
- Test Run option available
- Removes matched debit/credit open items
- Generates clearing document
Manual Clearing (Customer):
Fiori App: Clear Incoming Payments
GUI T-Code: F-32
- Select customer
- Choose open items
- Process Selected Items
- Post clearing document
Manual Clearing (Vendor):
Fiori App: Clear Outgoing Payments
GUI T-Code: F-44
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2. Dunning Process
Purpose:
Send payment reminders for overdue customer invoices.
Configuration Requirement:
Dunning Procedure must be assigned in BP (FI Customer Role – Company Code Level).
Fiori App: Create Dunning Notices
GUI T-Code: F-150
Three Steps:
1. Maintain Parameters
- Dunning Date
- Company Code
- Customers
2. Dunning Proposal
3. Printout / Dispatch
Additional App:
Display Dunning History
- View dunning levels
- View letters (PDF)
- Level 1 (Mild) to Level 4 (Legal Warning)
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3. Balance Adjustments
A. Allowance for Doubtful Accounts
Fiori App: Perform Further Valuations
GUI T-Code: F.107
Requirements:
- Value Adjustment Key in BP (FI Customer Role)
- Valuation Method (e.g., Flat Rate)
- Key Date (Month-End)
- Ledger (e.g., 0L – IFRS)
Process:
1. Maintain Parameters
2. Execute Proposal
3. Change Valuation (if needed)
4. Finalize Transfer Posting
5. Documents auto-reversed next month
Related Report:
Doubtful Accounts Valuation (Aging & Impairment View)
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B. GR/IR Adjustment
Fiori App: Repost GR/IR Clearing
GUI T-Code: F.19
Purpose:
Separate:
- Goods Received, Invoice Not Received (Liability)
- Invoice Received, Goods Not Received (Asset)
Process:
- Enter GR/IR Account
- Select Open Items
- Create Batch Input Session
- Process via SM35
- Adjustment documents posted & reversed next month
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C. Regrouping Receivables/Payables
Fiori App: Regroup Receivables/Payables
GUI T-Code: F.101
Purpose:
- Reclassify credit balance customers as liabilities
- Reclassify debit balance vendors as assets
- Temporary reconciliation account change
Process:
- Enter Company Code, Key Date
- Select Account Type (D – Customers, K – Vendors)
- Execute Simulation
- Generate Postings
- Auto reversal next month
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Key Concepts:
- Month-end clearing reduces open items.
- Dunning ensures receivable follow-up.
- Valuation adjusts impairment (Allowance).
- GR/IR adjustment ensures balance sheet accuracy.
- Regrouping corrects classification issues.
- Most postings auto-reverse in next period.
- Some tasks may be performed by GL team.
Conclusion:
These activities complete the AR/AP month-end closing cycle and ensure accurate financial reporting in SAP S/4HANA.
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