Create Credit Term – A summary of the activity
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You can identify the credit term with the unique code and the description. The credit terms are defined in the base currency of the organization. You can specify the limit for a single sale order or limit the total outstanding against the customer, including unexecuted sale orders, through the setting of the total sale order limit. You can also specify the action to be taken if the credit limit is exceeded. This activity also allows you to specify the credit limit for the individual credit buckets defined in credit check setup. You can specify the receivable details like whether reminders must be sent to the customer, credit check action, grace days for both discounts and receivables and the residual write off percent or amount.
The credit term code is unique for a business unit (BU) if the BU’s span across companies for the installation. If BU’s are within companies, the credit term code uniqueness is at the company level.
The system updates the status of the credit term to “Active” on creation. The system also stores the login ID of the user and the system date with the creation details.
What you can do in this activity
Define Single Order and Total Order Limits
Define Credit limit for each bucket
Define Receivable details for adjustment
Define Single Order and Total Order Limits
The order limits are defaulted to the Customer master during the mapping of a credit term to the customer, but are modifiable for individual customers.
Go to “Create Credit Term” page.
Specify the single order limit and the total order limit.
Save the credit term.
Define Credit limit for each bucket
The credit limits can be defined for each individual credit bucket, which are in “Active” status.
Go to “Create Credit Term” page.
Specify the credit limit for each credit bucket.
Save the credit term.
Define Receivable details for adjustment
Receivable details can be captured for the credit term, which will be later used by the “Customer Balance Adjustment” business component for adjustment. The receivable details are defaulted to the Customer master during the mapping of a credit term to the customer, but are also modifiable for individual customers.
Go to “Create Credit Term” page.
Capture the receivable details for the credit term and save the credit term.
The system updates the status of the credit term to “Active”. The system updates the login ID of the user to the created by and the system date to the created date.