Financial Document - Payment terms & Incoterms

[Former Member]

Hi all

Can any one explain me what is the main purpose of Payment terms and Incoterms in VX11N ( Financial Document )?

Where will it be Effected ?

Regards,

Anu

[former_member211616]

Hi Anuradha,

When u do export On the letter of credit ,

Incoterms is the international Commercials terms where the both the party agreed upon the agreement

costs and risks associated with the transportation and delivery of goods. The Incoterms rules are accepted by governments, legal authorities and practitioners worldwide for the interpretation of most commonly used terms in international trade

Without the incoterms You  cant be export the goods to other country

Ex- DDU - delivery duty paid ,means that door to door delivery of goods bear by the seller all charges

Payment terms  Is for composed of cash discount percentages and payment periods

As per my domain knowledge I explained ,

Regards

Ramesh

[jignesh_mehta3]

Hello Ramesh,

Request you to reply only to the question asked.

The question here is Why to input Payment Terms & Incoterms in Financial Documents?

What you have replied is basic defination of Incoterms which anyone can search on wikipedia (from where you have picked the text) & other sources on net.

Thanks,

Jignesh Mehta.

[Former Member]

Thanks for reply Jignesh & JP,

Can any one tell me what is the purpose of these 3

1. Typing Error

2. Amendment

3, Legal Change

Regards,

Anu

[former_member211616]

Hi Jignesh ,

Thanks For ur reply

I dint pick from the any source , i worked In a logistic company for four years thats why i know the terms and condition in export process , just to make her  understand better i have clarify

And i have answered both the valid point too in my answer

Regards

Ramesh

[jignesh_mehta3]

In case some details on the LC is changed by customer then the same will have to be changed in our Financial Document in SAP.

Thus in SAP while changing the LC, you can specify reason for changing the same & these are just the possible reasons that you can select from. 

Thanks,

Jignesh Mehta

[jpfriends079]

RAMESH you wrote:

Hi Anuradha,
When u do export On the letter of credit ,
Incoterms is the international Commercials terms where the both the party agreed upon the agreement 
costs and risks associated with the transportation and delivery of goods. The Incoterms rules are accepted by governments, legal authorities and practitioners worldwide for the interpretation of most commonly used terms in international trade
Without the incoterms You  cant be export the goods to other country 
Ex- DDU - delivery duty paid ,means that door to door delivery of goods bear by the seller all charges 
Payment terms  Is for composed of cash discount percentages and payment periods
As per my domain knowledge I explained , 
Regards
Ramesh 

Content from http://en.wikipedia.org/wiki/Incoterms

The Incoterms rules or International Commercial terms are a series of pre-defined commercial terms published by the International Chamber of Commerce (ICC) widely used in international commercial transactions. A series of three-letter trade terms related to common sales practices, the Incoterms rules are intended primarily to clearly communicate the tasks, costs and risks associated with the transportation and delivery of goods. The Incoterms rules are accepted by governments, legal authorities and practitioners worldwide for the interpretation of most commonly used terms in international trade.

I wish you might have contributed this wikipedia topic.

Further DDU(Delivered Duty Unpaid) is replaced by DAP(Delivered at Place).

And I hope you explained DDP - Delivered Duty paid, not DDU.

@ Anuradha:

Jignesh already provided you the gest of your requirement.

Further I will maintain you can only make modification to revocable LC & irrevocable unconfirmed LC.

[former_member211616]

Hi J Prakash ,

Some things are universally Truth  Like

there are 13 Incoterms and now 3 has added recently i have all updates buddy

U dint call to Apple as (Mango)

It may be there  in so many site i dint know that 

Regards

Ramesh

[former_member184555]

Hi Ramesh,

RAMESH PRUSTY wrote:
U dint call to Apple as (Mango) 
 

What does it mean? Can you please rephrase it?

Your previous message explaining the Incoterms was neatly phrased and excellent. But, all the other messages are differently phrased. Appreciate if you can use the same style of posting messages (as in your previous message of Incoterms explanation).

Regards,

Ravi Sankar

[jpfriends079]

May be its coincident.

But going back to your past, I don't think so.

Anyways, thanks for your valuable inputs & justification.

[former_member211616]

Thanks J Praksh ,

When u do new things there is a chance of mistake , if u learn from mistake you  have not really lost

I always appreciate all your inputs like from jignesh, lakhmipathi   had given in past

I always take is as positive note

Think is that I will not compromise where i am export

I can write more however doe to my project work not able to do so......

and lastly heart fully thanks you  also

Regards

Ramesh

[jpfriends079]

Please check following thread, where nice example is provided by Lakshmipathi Sir for payment terms:

- http://scn.sap.com/thread/1033696

As like LC is intergal part of foregin trade. So, is Incoterms.

As, Incoterms determine the so called critical points for three different fields of responsibility:

1. The risk (insurance)

2. The costs (freight, duties, etc.)

3. The documents

Critical points indicate where the resposibility of the seller transfers to the responsibility of the buyer.

For information in incoterms refer following link:

- http://en.wikipedia.org/wiki/Incoterms

- http://help.sap.com/saphelp_srm40/helpdata/en/35/26c795afab52b9e10000009b38f974/content.htm

[Former Member]

Thanks for Reply all,

In VX11N ,  Status Tab is there

When double click on E system is showing Pop-up with 3 Radio Button

1. Typing Error

2. Amendment

3, Legal Change

What is main use of 3 radio button ?

Any business case please explain?

Regards,

Anu

[jpfriends079]

There can be diff type of LC.

Widely used is irrevocable LC.

But, if you have Revocable LC, then based on following

1. Typing Error
2. Amendment
3, Legal Change 

you can change the LC.

[Former Member]

Hi

I am using "C" - Irrevocable confirmed

Please explian me what is main use of those 3 radio buttion ?

which i need to select ?

As per my knowledage C is used when Bank can give the assurance to seller

but i am not sure for remaining

can you please explain Fin, Doc Category { I checked some of thread i m not clear }

Regards,

Anu

[jignesh_mehta3]

Hello Anu,

Request you to read this link: http://en.wikipedia.org/wiki/Letter_of_credit & also F1 Help in SAP & google search for explanation on difference types of Financial Documents.

Thanks,

Jignesh Mehta

[jpfriends079]

Can you share the screenshot or you can post your query in FI forum.

Further also let us know, whether LC is captured on Exporter or importer.

[jignesh_mehta3]

Hello Anuradha,

There are two uses of putting Payment Terms & Incoterms in Financial Documents in VX11N.

First - After shipping the Goods, when you submit the LC Documents to Bank to get the payment, the Bank will make the Payment only if the Goods are shipped within the date mentioned in LC & as per the payment terms mentioned in LC. Thus it is veryimportant to mentioned Incoterms & Paymetns in Financial Doucment in SAP.

Second - You can put a check that while creating the Sales Order the Payment Terms & Incoterms in Sales Order & LC should be same. So that the LC Document subbmited to Bank are not rejected. Infact at my client site we have put a check that unless the Payment Terms & Incoterms in LC & Sales Order are same, system will not allow to create Delivery.

Thanks,

Jignesh Mehta

[former_member182490]

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