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Former Member

intercompany

Dear friends

What is difference between intercompnay billing and intercomany purchasing

explain with suitable scenario

With regards

Sankalp singhai

singhai.sankalp78@gmail.com

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  • author's profile photo Former Member
    Former Member
    Posted on Sep 19, 2007 at 12:24 PM

    Hi

    Refer below

    intercompany-billing

    A company arranges direct delivery of the goods to the customer from the stocks of another company belonging to the same corporate group.

    To put in simple terms, Company code A orders goods through its sales organization A from Plant B belonging to Company code B.

    It is imperative that both Plants A & B should have the material. In other words, the material is created for both the Plants A & B + their respective storage locations.

    Sales Organizations and Plants are uniquely assigned to Company codes. It is not possible to assign either a plant or a sales organization to more than one company code.

    Sales organizations and plants assigned to each other need not belong to the same company code.

    In other terms, a plant belonging to Company code A & assigned to Sales Organization A can also be assigned to Sales Organization B of Company Code B. This enables cross company sales.

    PARTIES INVOLVED

    1) End Customer 2) Ordering Company code 3) Supplying Company Code.

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  • author's profile photo Former Member
    Former Member
    Posted on Sep 19, 2007 at 12:26 PM

    <b>Intercompany Business Processing</b>

    Intercompany business processing describes business transactions which take place between two companies (company codes) belonging to one organization. The ordering company orders goods from a plant which is assigned to another company code.

    The following intercompany business transactions are possible:

    <u>Intercompany sales processing</u>

    A sales organization which is assigned to the ordering company code creates a sales order ordering goods from a plant assigned to another company code.

    The plant in the delivering company code delivers the goods to the customer for whom the sales organization placed the order.

    <u>Intercompany stock transfer</u>

    A purchasing organization which is assigned to the ordering company code creates a purchase order ordering goods from a plant assigned to another company code.The plant in the delivering company code delivers the goods to the plant for which the purchasing organization ordered the goods.

    Because the two companies balance their accounts independently, the delivering company must bill the ordering company for the goods. This internal billing transaction is carried out by means of an intercompany billing document. The delivering company bills the ordering company at a price that allows the delivering company to cover its costs

    <b>Intercompany Billing</b>

    After goods issue has taken place, you can process the delivery for billing. You can create the billing documents just like any other billing document on the Billing screen:

    for a single billing document with the menu path Billing document --->Create.

    for several billing documents with the menu path Billing document --->Billing due list.The delivery may have to be processed for billing twice.

    The delivering plant processes the delivery to create an intercompany billing document (billing document type IV) for the selling company. This company code posts invoice entry for this billing document.

    The billing document is automatically billed to the internal payer that is assigned to the sales organization. The intercompany charges that appear in the intercompany billing document represent the actual amount that the delivering plant is charging the sales organization.

    If the selling company is selling the goods to a customer, it processes the delivery to create an invoice for this customer. The system can take the prices from the order or determine new prices. It takes the quantity to be invoiced from the delivery.

    The billing due list for the intercompany invoice is generated after the customer invoice has been created.

    <b>Intercompany Stock Transfer ( Purchasing)</b>

    You can transfer stock from one plant to another where the plants belong to different companies (i.e. have different company codes).

    Since the plants belong to different company codes, the following points have to be considered from the sales point of view:

    delivery: the procedure for delivering on the basis of a purchase order from another plant should be similar to delivering on the basis of a sales order from a customer

    billing: the delivering plant will be charging the receiving plant for the material.

    To deal with these points, the stock transfer can be carried out with a normal purchase order type NB.

    The delivering plant can then create a delivery and an intercompany billing document on the basis of this purchase order.

    An incoming invoice with reference to the purchase order can be posted in the following ways:

    1. Manually, after the invoice has been checked

    2. Automatically, with an internal billing document via SAP EDI

    The following example outlines the procedure for intercompany stock transfer.

    <b>Company Structure</b>

    Company code

    Plant

    City

    Name

    0001

    A

    Atlanta

    0002

    B

    Boston

    Smith & Co.

    Business Transaction

    Plant A orders 100 tons of "Steel-1" from plant B at a price of USD 10.00 per ton.

    Plant A, company code 0001:

    The clerk responsible creates a normal purchase order (type NB) for the vendor Smith & Co. who is assigned to Plant B. The clerk can enter prices and delivery costs as usual.

    Plant B, company code 0002:

    On receipt of the purchase order, the vendor Smith & Co. enters a delivery for 100 tons of "Steel-1".

    When the material leaves the premises, the vendor Smith & Co. posts goods issue. The values and the quantity are not yet posted in the receiving plant (Plant A).

    Plant A, company code 0001:

    When the material arrives at Plant A, the clerk responsible posts goods receipt against the purchase order. The system now posts values and quantities in the receiving plant.

    Plant B, company code 0002:

    On the basis of the delivery, the system creates a billing document (intercompany billing) amounting to USD 1000.

    Plant A, company code 0001:

    In company code 0001, the incoming invoice can be posted in the following ways:

    The receiving plant checks the invoice with reference to the purchase order and posts invoice receipt. Invoice entry is posted with an internal billing document via SAP EDI

    Reward points if helpful

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