Cookbook Set Con

SAP AG Settlement Control in IS-U and IS-T
Version 0.1
March 11, 1999
Settlement Control
Advance Documentation for Release 4.51
SAP AG
Neurottstr. 16
D-69190 Walldorf
Germany
Date: May 9, 2006

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Settlement Control in IS-U and IS-T SAP AG
Copyright
Copyright  1999 SAP AG. All rights reserved.
No part of this document may be reproduced or transmitted in any form or for any
purpose without the express permission of SAP AG.
The information contained herein may be changed without prior notice.
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ementControl_e.doc Date: May 9, 2006
Settlement Control in IS-U and IS-T
Contents
About This Document ........................................................................................... 2

Features .................................................................................................................. 3
Purpose................................................................................................................... 4
The Settlement Control Concept ......................................................................... 5
Overview ............................................................................................................. 5
Glossary.................................................................................................................. 7
Settlement Variant ................................................................................................................. 7
Settlement Step ...................................................................................................................... 7
Settlement Type..................................................................................................................... 7
Settlement Category .............................................................................................................. 7
Amount Check Group............................................................................................................ 7
Appendix................................................................................................................. 8
IMG: Settlement Control ..................................................................................... 8
Define Settlement Categories............................................................................. 8
Define Settlement Types .................................................................................... 9
Settlement Rule Definition .................................................................................. 9
Define Grouping and Sorting Characteristics ........................................................................ 9
Define Amount Check Group .............................................................................................. 10
Define Settlement Variants.................................................................................................. 11
Settlement Variant Key ..................................................................................................... 11
Settlement Steps ................................................................................................................ 11
Grouping String............................................................................................................... 11
Sorting String .................................................................................................................. 13
Group Rules .................................................................................................................... 13
Amount Rule................................................................................................................. 13
Clearing Rule ................................................................................................................ 15
Specifications for Incoming Payment ............................................................................. 16
Charge Off Tolerance ................................................................................................... 16
Settlement of Remaining Payment Amount.................................................................. 16
End of Allocation .......................................................................................................... 17
Define Groupings and Ranking for Characteristics ........................................................... 17
Define Groupings for Characteristics.............................................................................. 17
Define Ranking for Characteristics ................................................................................. 19
Definition of Settlement Variant Determination ................................................ 20
Define Settlement Rules for Incoming Payments ................................................................ 20
Define General Variant Determination ................................................................................ 21
Define Restrictions for Item Selection at Transaction Level ............................ 21
Definition of Item Selection in Invoicing............................................................ 23
Define Item Selection in Invoicing (Bill Display) ............................................................... 23
Stand: 07.05.1999 11:05:00

About This Document
About This Document

This documentation provides an overview of the settlement control functionality used in
IS-U and IS-T. It describes the purpose and functions of settlement control within IS-
U/CCS and IS-T/RM. It also explains the underlying concept, the elements of settlement
control, and the special features of the individual areas of use in detail. The main
settlement control functions are then introduced using practical examples.
This document is an advance version of the documentation for settlement control in the
following systems:
• IS-U/CCS Release 4.51
• IS-T/RM-CA Release 4.51
As soon as this release is available, no further versions of this document will be produced.
All the information contained herein will then be available in the IMG chapter Settlement
Control Definition.
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Features
Features
Settlement control is used within clearing processing, and controls the automatic
allocation of an amount (a receivable or credit memo) to open items (for example,
allocation of payment amounts). It also controls automatic allocation of posted items to
each other (account maintenance) within contract accounts receivable and payable.
Based on this allocation, the item is cleared either partially or completely.
The settlement concept offers comprehensive, flexible control of the settlement rules.
This allows users to define their own customized rule set using the customizing functions,
taking all their company-specific requirements into account.
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Purpose
Purpose
Settlement control is used in the following areas:
• Contract accounts receivable and payable (IS-U-CA, IS-T-RM-CA)
− Account maintenance
− Automatic payment allocation
− Payment at cash desk
• Invoicing (IS-U-IN, IS-T-IN)
− Settlement of receivables/credit memos from consumption billing against open
items from the contract account
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The Settlement Control Concept

The aim of this chapter is to provide an overview of the settlement control concept, and to
explain the functional capabilities of settlement control in detail and illustrate them using
practical examples from the different settlement control areas.
To understand the detailed descriptions– especially the examples – you should familiarize
yourself with the corresponding chapters in the IMG first. They describe all the elements
of settlement control in the appropriate order. The latest version of the corresponding
IMG chapter is available as an appendix to this document.
Overview
The basis for settlement control consists of selection rules and settlement variants.
Selection rules define what is settled, while settlement variants define how settlement is
performed.
Selection rules are used to define which open items from the contract accounts are
available for settlement (for example, only due items, no cash security deposits) before
the settlement process.
A settlement variant defines an allocation and clearing strategy (which may be multi-
level) for the selected open items.
Each settlement step of a settlement variant consists of:
• Grouping the items according to various criteria for the purpose of common
payment
− Examples: items from one document, items with the same due date, items with
the same contract reference
• Sorting the items for the clearing sequence
− Examples: by due date, budget billing payments first, consumption billing first
• An amount rule for allocation according to payment amount
− Examples: no partial settlement, maximum 5 % variance
• A clearing rule for partial clearing
− Example: proportional distribution
• Special rules for incoming payment
− Clear tolerance
− Information for ending the settlement
The selection rules and settlement variants are defined on the basis of the settlement
category and settlement type.
• The settlement category is maintained in the contract account. It allows you to
assign separate settlement rules to different customer groups.
− Examples: residential customers, commercial customers
Date: May 9, 2006

• The settlement type represents the business transaction, and – except for the
settlement types for invoicing – is pre-defined.
− Examples: payment lot, payment at cash desk, account maintenance
The settlement types for invoicing can be freely defined by the user, depending on
the content of the invoicing unit. SAP supplies a standard derivation that determines
the settlement type on the basis of the billing procedure of the billing document to be
invoiced.
− Examples: periodic invoicing, final invoicing (upon termination of a contract),
move-out
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Glossary
Glossary
Settlement Variant
Key under which the rules for automatic allocation of the open items for the clearing
entries are defined.
Settlement Step
Consecutive number within a settlement variant that is used to identify individual steps in
the underlying settlement strategy. The rules for grouping, sorting, and clearing the items
are defined in the individual steps. The number determines the processing sequence of the
individual steps.
Settlement Type
Key that refers to the transaction in the automatic settlement postings. It is used to
determine the payment allocation and settlement rules in contract accounts receivable and
payable.
Settlement Category
Key that indicates the contract account reference in the automatic settlement postings.
Together with the settlement type, it forms the key under which the settlement rules are
defined in contract accounts receivable and payable.
Amount Check Group

Key under which the threshold values for the amount difference checks are stored.
The amount check group is used within a settlement step to define the amount-dependent
settlement conditions. When payment transactions are entered in the group of open items,
the difference between the available payment amount and the total balance of the posted
open items in the group is checked. For other clearing business transactions, the
difference between the sum of the credit items and the sum of the receivables in the group
is checked.
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Appendix
Appendix
IMG: Settlement Control
In Release 4.51, the structure of the IMG chapter Settlement Control Definition will be
changed slightly, based on experience to date and the suggestions SAP has received.
The first change affects the sequence of the activities. The new structure is:
• Define Settlement Categories
• Define Settlement Types
• Settlement Rule Definition
− Define Grouping and Sorting Characteristics
− Define Amount Check Group
− Define Settlement Variants
• Definition of Settlement Variant Determination
− Define Settlement Rules for Incoming Payments
− Define General Variant Determination
• Define Restrictions for Item Selection at Transaction Level
• Item Selection Definition in Invoicing
− Define Item Selection in Invoicing (Bill Display)
The second change affects the existing activities:
• Define Settlement Variant (Keys)
• Define Groupings and Ranking for Characteristics
• Define Settlement Variant (Activities)
These activities have been grouped together to form a single activity, in which all the
required settings for a settlement variant can be defined.
Define Settlement Categories

In this activity, you define the settlement categories. Settlement categories are used
together with settlement types to determine the settlement variant. The settlement
category appears in the contract account. This allows you to use the settlement category
to differentiate between different customer groups – for example, households,
commercial customers, or public facilities.
Example
You define two settlement categories:
• 0001 for your residential customers
• 0002 for your nonresidential customers
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Appendix
Define Settlement Types

In this activity, you maintain the settlement types. A settlement type represents a business
transaction.
The standard settlement types are supplied by SAP and – with the exception of the
settlement types for invoicing – cannot be changed or extended.
Settlement types that are used for settlement during the entry of incoming payments are
marked accordingly. This indicator allows you to use an alternate method for settlement
variant determination for these settlement types.
During invoicing, the pre-defined settlement types can be overridden using the FI-CA
event R400. The specification for this event supplied by SAP controls the settlement type
on the basis of the corresponding billing procedure of the invoiced billing document. The
system only uses settlement type R4 when no unique billing procedure is found.
For more information, refer to the documentation of sample function module
ISU_SAMPLE_R400 for event R400.
Example
Payment lot, account maintenance, periodic invoicing, final invoicing
Default Settings
Do not change the entries supplied by SAP.
You may use the following namespaces: X*, Y*, Z* (customer namespaces)
Activities
If you need additional settlement types (for invoicing, for example), define the required
settlement types in the system.
Settlement Rule Definition

In the following activities, you first define the grouping and sorting characteristics and
amount check groups. You will need these later to define the actual settlement variants. A
settlement variant consists of one or more settlement steps.
The settlement steps form the core of settlement control. They allow you to model a
multi-level automatic allocation and clearing strategy. The individual settlement steps
control the grouping, sorting, and amount-dependent allocation of open items for
clearing. The settlement steps are performed consecutively, unless a specific successor
has been configured within a settlement step.
For detailed information on the settings required in a settlement step, refer to the next
sections. In particular, the settlement control terms grouping string, sorting string,
characteristic, and amount check group are explained in detail.
Define Grouping and Sorting Characteristics

In this activity, you define the grouping and sorting characteristics for open items. They
are used to characterize the open items. They usually describe a certain property of an
open item (for example, Item is cash security deposit or Item is due). The characteristics
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Appendix
defined here are used in a settlement step for two different purposes: First of all, the
characteristics are used to group the open items. Open items that have identical values for
the grouping characteristics in a settlement step (for example, all items that have the same
due date) are treated as a unit in that step. Depending on the settlement rule used, all the
items that fall into such a group are either paid together or all excluded from payment.
Secondly, the characteristics are used to define the sort sequence of the open items.
Sorting determines both the processing sequence of the groups defined by the grouping
and the clearing sequence within the group itself.
Should the grouping and sorting characteristics supplied by SAP not be sufficient for your
purposes, you can define new grouping and sorting characteristics for settlement control.
There are two options for doing this:
1. The characteristic is an attribute of the open item
If the new characteristic in the open item (database table FKKOP) exists as a
database field, add the characteristic and enter the name of the corresponding
database field in the characteristic definition. In this case, leave the Active module
field blank.
Example: SAP standard characteristic 001 (company code)
2. The characteristic is derived
If the new characteristic does not exist as a database field in the open item, but can be
derived from the existing information during settlement, add the characteristic.
Choose a name in the customer namespace (X*, Y*, Z*) as the field name. The
characteristic is then derived using the function module that you entered in the Active
module field. The interface of this module must correspond to the interface of sample
module ISU_SAMPLE_TE516. For more detailed information, refer to the
documentation on the sample module.
Example: SAP standard characteristic 003 (transaction). It consists of a main
transaction and a sub-transaction. The combination is programmed in sample
function module ISU_SAMPLE_TE516.
Standard grouping and sorting characteristics are supplied by SAP.
Default Settings
Do not change the standard entries.
You may use the following namespaces: X*, Y*, Z* (customer namespace).
Activities
• Define any additional grouping and sorting characteristics that you may need.
• If necessary, write a function module to derive the characteristics, and assign it to the
new characteristic.
Define Amount Check Group

In this activity, you maintain the amount check groups. They are used in a settlement step
to define amount-dependent settlement conditions. The validation groups are used within
a set of open items as follows:
• In the case of incoming payments, the difference between the available payment
amount and the total balance of the posted open items from a group is used for
amount validation.
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Appendix
• For all other business transactions, the difference between the sum of the credit items
and the sum of the receivables is used for the validation.
Amount check groups enable you to define different amount variances within which
clearing is still allowed.
Note that the amount check group does not have the same functionality as the tolerance
group that is defined in the contract account. The amount differences determined from the
payment/item allocation –on the basis of the amount check group – are not charged off
implicitly; instead, they can be charged off, settled, or posted on account, depending on
the settlement rule you select.
Activities
Create the amount check groups you need. Note that the definition of the validation
groups is currency-specific. The amount validation itself is performed in the relevant
transaction currency.
Define Settlement Variants

In this activity, you define the settlement variants. A settlement variant consists of two
components:
• The settlement variant key
• The settlement steps
In addition, different groupings and the ranking can be defined for the individual
characteristics used for each settlement step.
Settlement Variant Key

The settlement variant key defines the name of the settlement variant. You can also define
a short text for the settlement variant.
Settlement Steps
Each settlement variant must consist of at least one settlement step. The individual
settlement steps are performed consecutively, unless an explicit successor rule is defined.
The individual steps are largely independent of one another. They merely inherit the
remaining amount for settlement from each preceding settlement step. Moreover, items
that were completely cleared in one settlement step are not used in the subsequent steps.
With the exception of these rules, all the settlement steps run independently for the
supplied set of open items.
The definition of a settlement step consists of information in:
• The grouping string
• The sorting string
• Group rules
• Incoming payment specifications
Grouping String
The characteristics specified in the grouping string are used to separate the open items
used in settlement into individual groups.
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Appendix
Usually, individual items do not represent intrinsic units – for payment, for example.
Instead, their existence is due to the technical implementation of open item accounting. In
contrast, the commercially sensible units (documents, bills, total set of items due) is
usually formed from a group of line items. These units also represent the payer’s
perspective of the account situation. To reflect this fact in the clearing algorithm – for
example, to determine the precise use for each payment amount whenever possible – the
open items are grouped together into logical groups (views) in each settlement step for
the purpose of joint clearing processing.
Only items for which the characteristic values of all grouping characteristics agree can be
settled against each other or paid together in one settlement step.
Examples include open items with:
• The same division
• The same contract reference
• The same document number
• The same due date
The grouping string can consist of up to five grouping characteristics. The characteristics
required for grouping are defined in activity Define Grouping and Sorting Characteristics.
During group formation, the grouping characteristics are linked with a logical AND.
Open items that are to be grouped together in one item group must have the same
characteristic values for all characteristics in the grouping string.
Example
If the grouping string consists of the characteristics company code and due
date, then all the open items that belong to the same company code and have
the same due date belong to one item group.
If no grouping string has been defined, all the open items in the corresponding
settlement step are processed together in a single item group.
In some cases, however, the grouping of open items on the basis of the characteristic
values in the grouping string is not sufficient to form the required item groups for
settlement. For example, grouping by division – without any other information – does not
give you any way to group two divisions together and a third division separately. Using
the division specification in the grouping string will always result in three groups being
formed from the three divisions.
These more complex grouping requirements can be modeled by defining appropriate
derived characteristics (see Define Grouping and Sorting Characteristics). For example, a
new characteristic could be assigned the same characteristic value for two divisions that
are to be combined in one group.
Alternatively, in addition to defining the characteristic as described above, settlement
control also allows a grouping definition for characteristics in addition to grouping
according to the original characteristic values. Additional grouping rules are defined for
each characteristic and settlement step (for each grouping and settlement variant until
IS-U Release 1.2). This functionality gives you the option of grouping together items with
different characteristic values. For example, two divisions that you want to group together
can be given the same characteristic value for the division characteristic through the
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Appendix
alternate grouping definition. To activate this, enter a grouping rule in the Grouping field
in each settlement step.
For detailed information on the options presented by the grouping and ranking definition,
refer to Define Groupings for Characteristics in this chapter.
Sorting String
The sorting string controls both the processing sequence of the individual item groups
defined through the grouping string and the sequence in which the open items within
these groups are cleared.
A simple example is sorting by due date:
The sorting string can consist of up to five sorting characteristics. The characteristics
required for sorting are defined in activity Define Grouping and Sorting Characteristics.
By making the appropriate entry in the Sort field, you can change the sort sequence for
each sorting characteristic from ascending to descending.
To allow you to model complex sorting requirements, settlement control also allows an
alternate ranking in addition to sorting by the current or derived characteristic values.
This is defined in activity Define Ranking for Characteristics.
The additional ranking rules are defined for each sorting characteristic and settlement step
(for each sorting and settlement variant until IS-U Release 1.2). You activate them for
each settlement step by entering a ranking rule in the Rank. order field.
For detailed information on the options presented by the extended grouping and ranking
definition, refer to Define Ranking for Characteristics in this chapter.
Group Rules
The group rules determine the conditions under which an amount is allocated to open
items in an item group defined through the grouping string, and how clearing is
performed.
Examples:
• No partial settlement allowed
• Settlement only when amounts are equal
• Settlement only when variance exceeds 5%
The group rules consist of the amount rule and the clearing rule. Alternatively, you can
also define your own allocations in the clearing rule settings through the function module
defined in the group rule.
Amount Rule
The amount rule determines whether an amount may be allocated to an item group. If the
condition of the amount rule is not fulfilled for an item group, this group is not allocated
any (payment) amount for settlement. An amount is allocated within a step until the entire
amount for settlement has been allocated. If only part of the amount can be allocated as a
result of the amount rules, the remaining amount is usually transferred to the next
settlement step.
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Appendix
In the case of settlement rules that are used in the incoming payment, you can also
prevent the transfer of the remaining amount for settlement to the next settlement step and
charge off the unallocated amounts. For more information, refer to the section
Specifications for Incoming Payment in this chapter.
Possible amount rules are:
• “ ”: No amount restriction
The amount is always allocated to the item group. Any amount check group that has
been entered is ignored.
• 0: Clearing only when amounts are equal
An amount is only allocated to an item group when the amount to be used for
clearing and the balance of the item group are identical. Any amount check group
that has been entered is ignored.
• 1: No partial clearing allowed
clearing is greater than or equal to the total of the item group. Any amount check
group that has been entered is ignored.
• 2: No overpayment allowed
clearing is less than or equal to the total of the item group. Any amount check group
that has been entered is ignored.
• 3: Maximum amount difference according to tolerance group, charge off tolerance
An amount is only allocated to an item group when the difference between the
amount to be used for clearing and the balance of the item group lies within the
tolerance defined in the contract account. Any amount check group that has been
entered is ignored.
• 4: Maximum amount difference according to amount check group
clearing varies from the sum of the item group in accordance with the rules defined
in the amount check group. If no amount check group has been specified, the amount
is processed as described in rule 0 above.
• 5: Incoming payment: Like 4, but for sequences of open items
When this amount rule is used, not only the entire item group is validated against the
amount used for clearing; the system also validates the allocation of the amount for
combinations of the items in that group. If the sum of the items in a combination
agrees with the amount used (taking the amount validation rule into account), then
further processing (clearing) is performed for this combination.
The aim of this procedure is to achieve amount allocation even when the payment
amount only involves a subset of the item group concerned (for example, customer
pays everything except the dunning charge).
• 6: Incoming payment: Like 4, but for sequences of documents
This amount rule is similar to the previous rule (5), the difference being that the
sequences are not formed with regard only to individual items in the item group.
Instead, all the open items of a document that belong to a common group are
included. Note that not all the items of such a document have to be contained in the
item group.
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Appendix
Because the line items usually do not represent payable units – as described at the
start of the Grouping string section – SAP generally recommends using this rule
instead of rule 5.
• 7: Incoming payment: Like 4, but for sequences of open item groups
This amount rule is also similar to rule 5, the difference being that the sequences are
not formed at open item level, but instead at item group level. Entire item groups are
taken into account when the amount is processed. In contrast to rules 5 and 6, the
settlement amount is allocated for all item groups.
This procedure represents a simplified version of procedure 6.
• 8: Proportional allocation of payment/credit to open item groups
During partial clearing, the amount to be processed is distributed proportionally
among the individual item groups. In this way, allocation is performed for all groups.
Note that the amount proportion determined within an item group is not necessarily
distributed among the open items; the clearing rule still applies. If an amount check
group was entered, then the total balance of all the open items available in the
settlement step is checked against the payment amount first.
• 9: Like 7, but without settlement for all groups
This amount rule is similar to rule 7, the difference being that only item groups with
the same balance indicator (debit or credit) are included when the sequences are
determined.
The aim of this procedure is to ensure that no settlement is performed between
receivables and credits in different item groups during cross-group allocation.
Clearing Rule
The clearing rule determines how a (payment) amount is allocated to an item group.
Prerequisite: the item group has been allocated an amount for settlement on the basis of
the amount rule. The allocation itself is performed consecutively for all the item groups
created in the settlement step on the basis of the grouping string. If the amount to be
cleared was not used completely by an item group, allocation continues with the next item
group. If all the item groups have been processed, the remaining amount is transferred to
the next settlement step.
Possible clearing rules are:
• “ ”: Allocation by sort sequence
The amount to be cleared is allocated to the open items in an item group in
accordance with the configured sort sequence. If the remaining amount is less than
the amount of the current item, then this item is only partially cleared.
• 1: Proportional distribution within a group in the case of partial clearing
If the amount to be cleared is less than the sum of the item group, the amount is
distributed proportionally among the individual items. If the amount is greater than
the sum of the item group, then all items are cleared and the remaining amount is
passed on to the next item group or the next settlement step.
• 2: Call alternate settlement variant in the case of partial clearing
If the amount to be cleared is less than the sum of the item group, the program
branches to a different settlement step in the same or a different settlement variant. If
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Appendix
the amount is greater than the sum of the item group, all the items are cleared and the
remaining amount is passed on to the next item group or the next settlement step.
When the program branches to a different settlement step, both the items from the
current group and the amount to be cleared are passed on for further settlement. You
have the option of forming item groups (only the items of one contract account, for
example) and – by switching to a different settlement variant – performing all further
settlement exclusively within this group.
• 3: Call a different settlement variant (new in IS-U Release 4.51)
This is a simplified version of rule 2.
• 7: Allocation through an external function module in the case of partial clearing
If the amount to be cleared is less than the sum of the item group, then allocation is
performed by the function module specified in the External function module field.
The interface of this module must correspond to the interface of sample module
ISU_SAMPLE_TE515. For more detailed information, refer to the documentation on
the sample module.
Allocation through a separate customer function module should remain the
exception. However, this does enable you to model your company’s specific
requirements using settlement control.
• 8: General allocation through the external function module
With this setting, allocation is generally performed by the function module specified
in the External function module field.
For more information, refer to the description for rule 7.
Specifications for Incoming Payment

The settings configured here are only used in settlement control when the settlement
variants are assigned to a settlement type for which the InPay indicator (incoming
payment) has been set. These settlement types are supplied by SAP and are only relevant
for settlement control of incoming payments.
Charge Off Tolerance
When this indicator is set, the system determines at the end of each settlement step
whether the unallocated payment amount lies within the tolerance values specified in the
corresponding contract account. If so, the amount is charged off. If not, and an
overpayment has been made, the remaining payment is available for use in further
settlement steps, and any unallocated amount at the end of all the steps is posted on
account.
Settlement of Remaining Payment Amount
When you enter a settlement step of the same or a different settlement variant, the system
determines whether the payment amount is still available in full. If not, settlement is
continued with the specified step.
This function serves to improve the runtime of the payment allocation programs. For
example, in the case of a minor overpayment, it prevents the system from running further
settlement steps that would try to allocate the remaining amount exactly, even though this
attempt is likely to fail. Instead, the program branches to the specified settlement step, in
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which the remaining amount can be allocated with the minimum possible runtime (for
example, use of the amount for the items selected according to the sort sequence with
partial clearing allowed).
End of Allocation
This indicator allows you to control whether the settlement steps are processed in the
specified sequence for an incoming payment, or whether the amount allocation should be
canceled under certain circumstances, even though other settlement steps have been
defined.
• “ ”: Run next settlement step
Settlement is continued with the next settlement step.
• 1: If complete payment amount is still available
Settlement is ended if no settlement took place in the preceding steps.
• 2: If payment amount has already been partially cleared
Settlement is ended if at least one settlement was successful in the preceding steps
and the payment amount already resulted in clearing.
• 9: Do not run any further settlement steps
Settlement is ended regardless of the circumstances
Define Groupings and Ranking for Characteristics

This function gives you additional freedom in controlling the grouping and sorting of
open items. The functions described in sections Grouping String and Sorting String only
allow you to sort and form groups on the basis of the respective characteristic values. If
you have to group different characteristic values together or have to sort independently of
the characteristic values, these functions are no longer sufficient.
Define Groupings for Characteristics

Groupings of characteristics within a settlement variant perform several tasks:
• Grouping characteristic values together
The alternate groupings allow you to re-code different characteristic values – which
usually result in different item groups – as a common characteristic value, thus
grouping together different item groups to form a single group.
Example
During settlement, you want to process the divisions electricity 01 and gas 02
together, but the division water 03 separately.
If you group divisions 01 and 02 together in characteristic group 0102, and
activate this grouping in the corresponding settlement step, electricity and gas
are processed together while the water division is processed separately. The
characteristic division is replaced by the division group when the item groups
are formed.
• Exclusion/special handling of specific characteristic values
The allocation rule represents an additional control option within the grouping of
characteristics. It determines whether and how a specific value of a selected grouping
characteristic (and thus the corresponding open items as well) is used for settlement.
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Appendix
If no specific allocation rule has been defined, then settlement is performed on the
basis of the item groups formed.
Allocation rules for exclusion and special handling of characteristic values are :
− 1: Allocation when the higher-level characteristics of the group are identical
Open items for which this allocation rule is defined for their characteristic value
in the group definition are not assigned to one single item group for further
settlement. Instead, such items are used in all the groups in which the upper-
level characteristics defined in the grouping string are identical.
If the characteristic to which this special allocation rule applies is the first one in
the grouping string, then cross-group settlement applies to all the item groups
formed.
Example
In account maintenance, you want payments on account to be allocated –
similarly to incoming payment – as precisely as possible to one of the bills
(documents) from the contract account. If you used the settlement variant for
incoming payments for this, a grouping by document number would usually
result in the payment on account falling in a different item group than the bill to
be paid.
This allocation algorithm can be modeled in a settlement step as described in
the following:
In the structure of the grouping string, use the characteristics 1 transaction and Formatiert: Nummerierung und
2 document number, and the appropriate amount rule (for example, 0). Aufzählungszeichen
Select grouping 2 for characteristic transaction.

Define the alternate grouping (described above) with allocation rule 1 for the
characteristic value payment on account of characteristic transaction.
With these settings, the documents are defined in clearing processing as
payable units, and the payment on account is defined as a variable amount.
If you want to use the payment on account as an additional condition only
within the corresponding company code, then place the characteristic company
code in the structure of the grouping string for the two characteristics
transaction and document number. In this case, the characteristic company
code will be given priority over the characteristic transaction. Cross-group
settlement then does not apply to this characteristic, in accordance with the
definition of allocation rule 1.
− 2: No allocation for items with this characteristic value
Open items for which this allocation rule has been defined in the group
definition of their characteristic value are excluded from processing in the
respective settlement group. Allocation to an item group does not occur.
− 3: New rule in IS-U Release 4.51
− 4: New rule in IS-U Release 4.51
To simplify the definition of the alternate groupings, activating the grouping in a
settlement step offers several control options.
For all the settings described below, all the characteristic values defined in the respective
characteristic groups are re-coded for all the values defined in the grouping. The
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Appendix
difference is in the treatment of the characteristic values that have not been defined in the
grouping.
The following settings are possible:
• 1: Grouping in accordance with group definition, otherwise characteristic value
All unlisted characteristic values are treated as if a 1:1 relationship has been defined
between the characteristic value and the characteristic group. All characteristic
values that are not explicitly defined continue to generate different groups of open
items.
• 2: Grouping in accordance with group definition, otherwise group SPACE
Characteristic group SPACE is assumed for all unlisted characteristic values. All
characteristic values that are not explicitly defined are grouped together in one
characteristic group.
• 3: Grouping in accordance with group definition, otherwise no allocation
Open items whose characteristic value does not appear in the group definition are
excluded from processing in the relevant settlement step. Allocation to an item group
does not occur.
Define Ranking for Characteristics

As an alternative to normal sorting by the characteristic value of the sort characteristics,
you can also sort by a defined ranking of the sorting characteristic values.
To simplify the definition of the ranking, an indicator for the ranking in a settlement step
offers several control options.
For all the settings described below, the rank is fixed for all the characteristic values
defined in the ranking. The differences to sorting lie in the handling of characteristic
values that are not defined in the ranking.
The following settings are possible:
• 1: Priority corresponds to ranking, otherwise characteristic value
For all unlisted characteristic values, the value itself is treated as the priority.
• 2: Priority corresponds to ranking, otherwise to priority 000
Priority 000 is used for all unlisted characteristic values. The corresponding open
items are assigned at the beginning or the end, depending on the sort sequence
defined in group processing.
• 3: Priority corresponds to ranking, otherwise to priority 999
Priority 999 is used for all unlisted characteristic values. The corresponding open
items are assigned at the beginning or the end, depending on the sort sequence
defined in group processing.
Example
Within an item group, you want to allocate budget billing payments first.
Otherwise, allocation should take place in accordance with the due date,
regardless of the transaction.
To achieve this, define 1 transaction and 2 due date as sort characteristics. For
the transaction characteristic, you must assign priority 1 to the transaction for
budget billing payments.
Date: May 9, 2006

Appendix
In the sorting string of the settlement step, activate the ranking for the
transaction characteristic with setting 2. Sorting must be in ascending order.
With these settings, only the budget billing transaction is given special handling
during sorting. All other transactions are sorted identically, that is, by the
second sorting attribute due date.
Definition of Settlement Variant Determination

Two different procedures are used to determine the settlement variant, depending on the
settlement type.
Two-step variant determination is used for settlement types in which the InPay indicator
(incoming payments) is active:
• In the first step, the settlement variant is sought according to the settings in
settlement rules for incoming payments. If no settlement variant is found for those
settings, and additional variant determination is allowed, determination continues
with step 2.
• In the second step, the settlement variant is determined in general variant
determination, depending on the settlement type and settlement category.
One-step variant determination is used for settlement types in which the InPay indicator is
not active:
• The settlement variant is determined in general variant determination, depending on
the settlement type and settlement category.
Note that settlement is only possible when a settlement variant is found. If variant
determination is not successful, no error message is issued in the settlement control.
Define Settlement Rules for Incoming Payments

In this activity, you can configure how the payment amounts are to be settled during the
entry of incoming payments regardless of the general variant determination. The rules can
only be defined for settlement types for which the InPay indicator (incoming payments) is
active.
The general allocation rule determines whether a settlement variant is to be used,
regardless of the respective settlement category. You can also configure the rules such
that the configured settlement variant is only used when the payment cannot be allocated
to a contract account.
If no settlement variant can be determined through the general allocation rule, the
algorithm of the settlement category-specific allocation decides whether a settlement
variant is to be determined using general variant determination.
If no payment allocation is possible using the configured settings, the payment amount is
posted on account or posted to a clarification account, depending on the specifications for
using non-allocated amounts.
Activities
Enter the required information.
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Appendix
Define General Variant Determination

In this activity, you define which settlement variant is to be used for a specific
combination of settlement type and settlement category. If no allocation is achieved here,
the settlement is not active.
If no settlement variant has been specified, the entire settlement control can be performed
using logic implemented in the project. To do this, you must specify a function module in
the Active module field. If a settlement variant has also been specified, the system runs
the specified function module after the settlement variant has generated a clearing
proposal.
The interface of this module must correspond to the interface of sample module
ISU_SAMPLE_TE513. For more information, refer to the documentation on the sample
module.
Activities
Define Restrictions for Item Selection at Transaction Level

In this activity, you can restrict the open items that are used in settlement control – for
example, to a specific due date.
The open items are usually selected taking into account the clearing restriction that is
defined in the item in the context of the corresponding business transaction.
In addition, you can define selection restrictions for each transaction before the actual
item allocation. In these restrictions, you define basic rules for item selection depending
on the settlement type and settlement category – for example, which due dates to include
or which transactions should be completely excluded from the clearing process.
You can maintain multi-level restrictions. When a valid entry for an open item is found,
the system uses the selection rule and the interval days to decide whether the item is
included in clearing or not.
Example
Business transaction: account maintenance in periodic invoicing (settlement

type R41)
You want to
− Only include items that are due in the next 14 days (from document date) at
the latest.
− Allow settlement with the next budget billing request (main transaction 0050),
which is due in 21 days at the latest.
− Not include the cash deposit payment (transaction 0020 0010) in the
settlement.
Date: May 9, 2006

Appendix
You can model the above requirements by using the following three
restrictions:
STp SCat Main SubT OISel Intvl

R41 100 14
R41 100 0050 21
R41 100 0020 0010 9
When a table entry has been determined for an item, the corresponding selection rule in
the OISel field (open item selection) and then the interval information for the item due
date are interpreted.
The following settings for the selection rule are possible:
• “ ” All the items that qualify for the current table entry are included.
• 1: Only items with a contract reference (items that are assigned to a contract account)
are included.
• 2: Only items that refer to contracts that are processed in the current business
transaction are included. This rule applies to invoicing. It returns the set of items for
the contracts that are currently being invoiced.
• 3: In addition to the conditions in rule 2 above, items that do not have a contract
reference are also included (such as payments on account that do not have a contract
account assignment).
• 4: Item selection is performed as described in rule 2 above, but only for contracts that
have been terminated. This rule can be used, for example, to include a cash deposit in
the final clearing during invoicing of a terminated contract.
• 5. Only items that were posted in the current business transaction are included – for
example, all new open items from consumption evaluation.
• 9: No items that qualify for the current table entry are included.
Note
Up to three attempts to find an entry in the table are made for each open item.
The search is performed under the following criteria:
− Access with a fully qualified key
− Access with a non-specified sub-transaction
− Access with a non-specified main transaction and sub-transaction
The first item found is used for the restriction. Open items for which none of the
three entries have been maintained in the transaction are included unfiltered
during settlement.
Activities
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Appendix
Item Selection Definition in Invoicing

A fixed component of a print document consists of the posting documents generated in
invoicing on the basis of contract billing minus any budget billing payments made. In
addition, open items that were (partially) cleared during account maintenance for
invoicing also appear in the printed document.
In invoicing – as a supplement to the rule set for settlement control in clearing processing
– you can select items to appear on the bill. This does not trigger any subsequent
postings, and only affects the appearance of the printed document. The item selection
controls which posted open items are to be printed on the bill for information purposes,
and which are to be used to determine the bill total. Moreover, the item selection controls
which credits (possibly with clearing restrictions), such as a cash security deposits, are to
be re-posted to the credit memo in billing so that they can be repaid.
Item selection does not involve the open items generated during the current invoicing run,
instead it concerns only items that were entered beforehand.
Define Item Selection in Invoicing (Bill Display)

The selection of open items depends on the settlement type of the current invoicing run
and the settlement category defined in the contract account. It can be defined at
transaction level. The key and the multi-level access logic for the table correspond to the
procedure for defining the selection restrictions described in activity Define Restrictions
to Item Selection at Transaction Level. In contrast to the definition of the selection
restrictions, however, items for which no entry can be determined for the transaction are
excluded from processing.
Yon can use the table to control the following:
• Which open items from the contract account are to be included in the print document.
The items can also be displayed on the bill for information purposes only.
• Which items are to be included in the bill total and, accordingly, are to be paid
together in the payment transactions. This rule is particularly useful for credits that
qualify for clearing processing based on settlement control, but were not used
because the account only has credit items. The items included in the bill total are
included as a component of the bill. Note that the items grouped together in a bill
total retain their original due date. If you group together older receivables, the bill
suggests that the customer is given a payment extension.
• Which credit items you want to re-post to the credit memos in billing. This rule can
be used together with a cash security deposit payment that has been assigned a
clearing restriction, for example, in order to clear it in final invoicing.
• Which statistical receivables you want to clear without subsequent postings (from
Release 4.51). This rule applies, for example, to clearing any open cash security
deposit requests in final invoicing.
Date: May 9, 2006


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SAP AG Settlement Control in IS-U and IS-T

Date: May 9, 2006

The information contained herein may be changed without prior notice.

Settlement Control in IS-U and IS-T

About This Document ........................................................................................... 2

Stand: 07.05.1999 11:05:00

About This Document

Date: May 9, 2006

The Settlement Control Concept

Date: May 9, 2006

Amount Check Group

Date: May 9, 2006

Define Settlement Categories

Define Settlement Types

Settlement Rule Definition

Define Grouping and Sorting Characteristics

Date: May 9, 2006

Define Amount Check Group

Define Settlement Variants

Settlement Variant Key

Date: May 9, 2006

Date: May 9, 2006

Date: May 9, 2006

Specifications for Incoming Payment

Charge Off Tolerance

Settlement of Remaining Payment Amount

Define Groupings and Ranking for Characteristics

Define Groupings for Characteristics

Date: May 9, 2006

Select grouping 2 for characteristic transaction.

Define Ranking for Characteristics

Date: May 9, 2006

Definition of Settlement Variant Determination

Define Settlement Rules for Incoming Payments

Define General Variant Determination

Define Restrictions for Item Selection at Transaction Level

Business transaction: account maintenance in periodic invoicing (settlement

Date: May 9, 2006

STp SCat Main SubT OISel Intvl

Item Selection Definition in Invoicing

Define Item Selection in Invoicing (Bill Display)

Date: May 9, 2006

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