Prerequisite settings in vendor/customer master

Vendor Master

1 Input Customer Information in Vendor Master

1. The customer number is used by the payment and dunning programs for clearing open
items. For line item display, the link to the customer line items is established using this
number.

     If you require clearing between the customer and vendor, the following requirements must
be met:

     –  The customer number must have been entered in the corresponding vendor master
record.

     –  The vendor number must have been entered in the corresponding customer master
record which we will do in the next step.

     –  The fields “Clrg with vend.” or “Clrg with cust.” must have been selected in both master
records.

     2. For clearing with customer setting, the screen is as shown below. As for clearing with vendor
setting will cover in next step.

When you try to activate the ‘Clrg with cust.’ Indicator, SAP displays the follow message where the
‘clearing account 10201734’ is the customer number.
Customer master

2 Input Vendor Information in Customer Master

    1. Specifies an alphanumeric key that uniquely identifies the vendor or creditor in the SAP
system.

     2. Then turn on the ‘Clearing with vendor’ indicator in order to complete the settings in respective
master in order to allow clearing with customer during

          automatic payment process.

Clearing between vendor and customer via F110

1 Analyse Vendor and Customer Balance

1. Analyse the open item balance for vendor, that the total amount outstanding on vendor
side must be greater than the balance outstanding on customer side. This is required in
order for clearing with customer to work.

         Vendor Open item

Please take note, the item with debit balance where the document number is 620004610 as shown
above, should be excluded from automatic payment in the parameter set up (shown in next step) as
SAP throws out error during payment run.

     2. Check the outstanding balance on the customer side where the amount is 2,200 very
much less than the vendor outstanding amount.
          Customer Open Item

     3. Together with the settings both in vendor and customer master we discussed previously being
fulfilled then we can proceed to next step for payment           settlement between the vendor and
customer.

2 Automatic Payment Settings and Payment Run

      1. In the F110 (Automatic Outgoing Payment) parameter settings as shown below, both vendor
and customer must be input in order to do offsetting payment           between a vendor and
customer. Both vendor and customer numbers must be entered besides other settings.
     2. The result of payment proposal list shows the amount details of all open items from vendor
and corresponding customer highlighted in red colour box.
     3. Display payment proposal job log