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Topics
Overview
Contract Account
Document Types and Number Ranges
Account Determination
FI-CA Document
FI-CA Processes
Additional Document Functions
Account Balance Display
FI
Marketing
& Sales
External
Sales Systems
Financial
Accounting
Contract
Accounting
(FI-CA)
Maintenance
& Service Management
MM
Central
Business
Partner
PM/
SM
AM
ConsumptionExternal
Entry
Consumption
Entry
Systems
IS-U/CCS
MM
Assets &
Material Management
Proprietary and Confidential
Core components
Device
Management
CO
Industry specific
components
Billing /
Invoicing
Services
SD
Customer
Care & Service
SD
GIS,
CAD,
SCADA
as an
integrated component
of the R/3 enterprise
information system
What is FI-CA
Contract Accounts Receivable and Payable (FI-CA) is an accounting
sub-ledger for processing large volumes of data
The Contract Account represents the customer account that is billed for
services provided by the utility
All financial transactions impacting the customer, such as invoicing,
charges and credit adjustments are posted as Documents in FI-CA, and
are reflected on the customer account balance
Topics
Overview
Contract Account
Document Types and Number Ranges
Account Determination
FI-CA Document
FI-CA Processes
Additional Document Functions
Account Balance Display
Contract Business
Partner
- Billable Customer
Contact Business
Busine
Partner
ss
- Contact Person
Partne
Prospective Business
r
Partner
Contract
Account
- Interested
TheCustomer
Contract Account
combines all contracts
that have the same
payment and credit
details.
Contract
An agreement
between the customer
(a Contract Business
Partner) and a utility to
provide a service (e.g.
electric, water, gas).
Proprietary and Confidential
Apart
mt
Apartment 1 =
Premise
Contra
ct
Electri
city
Contra
ct
Accoun
t
Contra
ct
Gas
Install
atn
Electri
city
Meter
Install
atn
Gas
Meter
Device
Locati
on
Hallwa
y
Device
Locati
on
Basem
t
2
Apart
mt
3
Apart
mt
4
Move In/Switch/Transfer
A Move In occurs when a customer
(Business Partner) moves into a premise
or switches retailers and is supplied with
a service. The Move In links the Technical
Master Data with the Business Master
Data by allocating a contract to an
installation.
7
Connection Object
A building or property
linked to the supply
network.
Premise
A single unit (e.g.; an
apartment within a
building) that is supplied
with the relevant service.
E.g. - a residential home
would be set up as one
connection object with
one premise.
Device Location
The place within a
connection object where
devices (e.g. a meter,
curb valve, tap etc) are
installed.
Installation
An installation groups
together all devices of the
same division (electricity or
gas) that are allocated to a
premise. The installation
contains pricing data for
billing.
Contract Account
The Contract Account forms the basis for FI-CA in the SAP IS-U solution
It represents the customer account that is billed for services provided by
the utility
It contains all details required to manage customer-related financial
postings, e.g.
Topics
Overview
Contract Account
Document Types and Number Ranges
Account Determination
FI-CA Document
FI-CA Processes
Additional Document Functions
Account Balance Display
10
Document Types
Each possible document
type needs to be identified
Document types are based
on various transactions of
the utilitys business
functions, e.g. Invoice,
Payment
SAP provides a range of
standard document types
Additional ones can be
defined according to
business requirements
11
12
13
Topics
Overview
Contract Account
Document Types and Number Ranges
Account Determination
FI-CA Document
FI-CA Processes
Additional Document Functions
Account Balance Display
14
Account Determination
All FI-CA document postings go through automatic account
determination, hence there is no need for the user to enter GL accounts
and cost objects at the time of posting
The account determination is driven by the combination of Company
Code, Division, Account Determination ID, Main Transaction and Sub
Transaction
15
Represents the legal entity for which a full set of financial statements are
produced
Defined in the Financial Accounting section of the Enterprise Structure
Division
16
Account Determination ID
Account Determination ID (ADID)
A key that enables automatic account determination for postings at the
contract account or contract level
Typically aligned by the type of customer account, e.g. Residential,
Commercial, Government etc
17
Main Transaction
Main Transaction
A 4-digit key that identifies the
type of transaction being posted,
e.g. Consumption Billing,
Miscellaneous Posting, Payments
Drives the Balance Sheet
account
18
Sub Transaction
Sub Transaction
A 4-digit key that represents a further
segmentation of the Main Transaction,
e.g. Miscellaneous Posting is further
classified into Reconnection Fee,
Meter Installation Fee, Interest Waiver
The combination of Main and Sub
Transaction drives:
The P&L account
Taxability of the item
Business Area and CO account
assignments
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20
21
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Tax Code
Tax Codes drive the
automatic calculation of the
sales tax amount
Tax codes may be defined
as taxable or non-taxable
The Tax Rate is maintained
in the Financial Accounting
Global Settings
If Jurisdiction Code is used,
the tax rate needs to be
assigned for each defined
Proprietary and Confidential
23
Jurisdiction Code
24
CO Account Assignment
The CO Account Assignment
Key drives the automatic
determination of cost
accounting objects, e.g. Cost
Center, Order etc
25
Main
Account
Determinat Transaction
ion ID
Sub
Transact
ion
4-character
2-character
2-character
4-digit
4-digit
identifier
identifier
identifier which
identifier
identifier
representing
representing
allows the
representing
representing
the legal entity
the service
same
type of
further
that has to
transaction in
transaction
segmentation
produce the
the same Co.
of transaction
balance sheet
Code & division
When
a
transaction
is
posted,
the above combination in FI-CA
and income
to post to
will
drive the derivation of different
the below
combination in FI-CO for
statements
GL
accounts posting
revenue/expense
Company Code
GL Account
26
Business Area
Cost Center
Topics
Overview
Contract Account
Document Types and Number Ranges
Account Determination
FI-CA Document
FI-CA Processes
Additional Document Functions
Account Balance Display
27
FI-CA Document
Transaction postings in FI-CA result in documents being posted on the
contract account
FI-CA documents may be posted manually or via mass processes
A FI-CA document consists of Document Header, Business Partner Item
and GL Item
28
Header
BP Item
GL Item
29
30
31
32
Topics
Overview
Contract Account
Document Types and Number Ranges
Account Determination
FI-CA Document
FI-CA Processes
Additional Document Functions
Account Balance Display
33
FI-CA Processes
Accounts
Receivable
Consumptio
n charges from
Billing/Invoi
cing
Miscellaneo
us Postings
Closing
Other
Processes
Security
Transfer
Deposits
to
Interest
General
Dunning
Ledger
Creditworthi
ness
Deferrals
Installment
Plans
Collection
Agency
Write-Offs
ACCOUNT
BALANCE DISPLAY
Transfer
Postings
Loans
Escheatm
ent
Payments
Credit &
Collections
Incoming
Payments
Clarificati
ons
Returns
Refunds
34
FI-CA Processes
Accounts
Receivable
Consumptio
n charges from
Billing/Invoi
cing
Miscellaneo
us Postings
Closing
Other
Processes
Security
Transfer
Deposits
to
Interest
General
Dunning
Ledger
Creditworthi
ness
Deferrals
Installment
Plans
Collection
Agency
Write-Offs
ACCOUNT
BALANCE DISPLAY
Transfer
Postings
Loans
Escheatm
ent
Payments
Credit &
Collections
Incoming
Payments
Clarificati
ons
Returns
Refunds
35
Consumption Charges
Consumption Charges are posted to the contract account via Invoicing
Consumption during the bill period is measured via meter reads, and the
billed amount is calculated via the Billing engine
For active contract accounts, Consumption Bills are posted according to
the customers bill cycle
However in certain situations a Manual Bill may be generated as well
A Final Bill is generated if a move-out has been processed for the
customer
Accounting Entries
Dr Customer AR
Cr Sales Revenue
Proprietary and Confidential
36
Miscellaneous Postings
Miscellaneous Postings are manually-posted charges and credits on the
contract account e.g. bill reprint fee, late fee waiver
Manual postings can be made in IS-U as well as the IC-Web
Automated postings are also possible through the use of enhancements,
e.g. service establishment fee, reconnect fee
As these postings are non-consumption charges, they may occur at any
time, hence they need to be due-date synchronized with the
consumption invoice due date
Accounting Entries
Dr Customer AR
Cr Other Revenue (i.e. by the respective types of charges)
Proprietary and Confidential
37
FI-CA Processes
Accounts
Receivable
Consumptio
n charges from
Billing/Invoi
cing
Miscellaneo
us Postings
Closing
Other
Processes
Security
Transfer
Deposits
to
Interest
General
Dunning
Ledger
Creditworthi
ness
Deferrals
Installment
Plans
Collection
Agency
Write-Offs
ACCOUNT
BALANCE DISPLAY
Transfer
Postings
Loans
Escheatm
ent
Payments
Credit &
Collections
Incoming
Payments
Clarificati
ons
Returns
Refunds
38
Incoming Payments
Incoming payments clear open receivables on the contract account
A clearing document is created for the paid open item with Clearing
Reason Incoming Payment
Payment Methods
Cheque
Cash
Debit/Credit Card
Direct Debit
Payment Channels
39
Clearing
Allocation of payments to open items
Automatic clearing based on Clearing Rules
Manual clearing possible via Account Maintenance
Accounting Entries
Dr Cash/Check Clearing
Cr Customer AR
Proprietary and Confidential
40
Clarifications
Payments are routed to the Clarification list when they cannot be posted
to a contract account, possibly due to
Missing / incorrect account number
Payment flagged to be clarified
Posting lock on the contract account
The monies are held in a clarification account until the contract account
can be determined
Dr Cash/Check Clearing
Cr Clarification
41
Returns
Returns are payments that have been processed in the system but
subsequently need to be reversed
Typically returns may arise due to insufficient funds, closed accounts etc
Returns result in a clearing reset between the payment and open item
that was cleared
A clearing document is created for the returned payment document with
Clearing Reason Returns
The paid item reverts back to open status and proceeds along the
dunning path from where it left off
42
Returns (cont.)
A return fee may be assessed on the contract account and a return letter
is sent to the customer
Returns are posted via
Returns Lot manual creation
Returns Lot Transfer interfaces from banks
Accounting Entries
Dr Customer AR
Cr Return Fee
43
Refunds
Credits on the contract account may be refunded to the customer
Credits may arise due to over-payment by the customer, a released
security deposit or a credit adjustment
In most utilities, credits are refunded if the contract account has been
final-billed (i.e. inactive account), while credits on active accounts are
used to clear subsequent receivables
Refund requests are typically approved via an approval workflow
Once approved, the Payment Run processes the outgoing payment, and
a refund cheque is created in Check Management
44
Refunds (cont.)
A clearing document is created for the open credit with Clearing Reason
Outgoing Payment
Accounting Entries
Dr Customer AR
Cr Refund Clearing
45
FI-CA Processes
Accounts
Receivable
Consumptio
n charges from
Billing/Invoi
cing
Miscellaneo
us Postings
Closing
Other
Processes
Security
Transfer
Deposits
to
Interest
General
Dunning
Ledger
Creditworthi
ness
Deferrals
Installment
Plans
Collection
Agency
Write-Offs
ACCOUNT
BALANCE DISPLAY
Transfer
Postings
Loans
Escheatm
ent
Payments
Credit &
Collections
Incoming
Payments
Clarificati
ons
Returns
Refunds
46
Security Deposits
Security Deposits are business-determined amounts of money held by
the utility to cover any possible losses due to unpaid receivables
Security Deposits may be in the form of cash or non-cash, e.g. personal
guarantee, bank guarantee, letter of credit
Interest can be calculated on security deposits and paid to the customer,
depending on regulatory or business requirements
Security deposits are released if the customer maintains good payment
behavior or when the customer moves out
Released security deposits result in an open credit on the contract
account, which may either be refunded or used to clear open receivables
47
48
Interest
Interest on receivables can be assessed when the customer does not
pay by the stipulated due date
Interest key, interest rates and calculation rules need to be defined
To prevent interest assessment, an Interest Lock may be assigned on
the open item or the contract account
Accounting Entries
Dr Customer AR
Cr Interest Receivable
49
Dunning
The collection of past due receivables is managed via the Dunning
process
It encompasses a series of steps, typically from a Reminder Notice
progressing to Disconnection
Dunning comprises two parts i.e. Dunning Proposal and Dunning Activity
Dunning Proposal identifies which items are eligible to be dunned, groups
them into dunning groups and determines the associated collection step to
be executed for the groups
Dunning Activity performs the execution of the collection step determined by
Dunning Proposal
50
Dunning (cont.)
The Collection Strategy defines the utilitys specific business rules for
collections and determines the collection paths for customers, e.g.
For low risk customers
Reminder Notice at 3 days past due if debt is greater than RM300
Disconnect Notice at 15 days past due if debt is greater than RM500
For high risk customers
Disconnect Notice at 7 days past due if debt is greater than RM300
51
Creditworthiness
Creditworthiness is a numeric score assigned to customers based on
their payment history
Creditworthiness points may be assessed manually as well as
automatically, via various credit-related transactions e.g. Returns,
Dunning, Write-offs
Each credit-related transaction is assigned a value, e.g.
Return
2 points
Reminder Notice 3 points
Disconnect Notice
5 points
52
Creditworthiness (cont.)
The system re-calculates the overall Creditworthiness score dynamically,
by totaling all creditworthiness events multiplied by the weighting factor
in the configured timeline, e.g.
Reminder Notice in Feb 2012:
3 points x 0 = 0
5 points x 2 = 10
= 18
53
Deferrals
A Deferral is an extension of payment due date granted to customers
who are unable to meet the original due date
Eligibility for deferral and the number of days allowed are driven by
business rules
The deferral date is entered on the open item
Dunning can be configured to ignore the open item until the deferral date
is passed
Deferrals can be entered in IS-U as well as the IC-Web
There are no accounting entries arising from a Deferral
54
Installment Plans
An Installment Plan is a payment arrangement that distributes open
items over several due dates in future
It enables the customer to make their payments in smaller amounts over
a longer period of time, e.g. for a consumption bill of RM300 that falls
due on 5 July 2014, the following installment plan is granted
Installment 1 RM100 due on 5 July 2014
Installment 2 RM100 due on 5 Aug 2014
Installment 3 RM100 due on 5 Sep 2014
Similar to deferral, eligibility for and length of the installment plan are
driven by business rules
Installment Plans can be created in IS-U as well as the IC-Web
55
56
Collection Agency
Past due receivables can be handed over to an external collection
agency if they remain unpaid despite all measures taken to collect them
Collection agencies used by the utility need to be set up as business
partners
Typically receivables submitted to the collection agency are that of finalbilled accounts
There are 2 parts to the process, i.e. release of the receivables and the
actual submission to the collection agency
Release this step sets a flag on the open item, and may be executed
manually or automatically via Dunning and Write-off transactions
Submission this step creates a file containing the released items, which is
sent to the collection agency through an interface
Proprietary and Confidential
57
58
Write-Offs
Write-Offs involve the removal of uncollectible receivables from the
contract account onto a write-off expense account
A clearing document is created for the written-off open item with Clearing
Reason Write-off or Mass Write-off
Typically written-off receivables are that of final-billed accounts
If a written-off item is subsequently paid, the write-off can be reversed
and then the debt is cleared against the payment
Criteria for write-off e.g. minimum amount, collection step etc are
determined by business rules
Accounting entries
Dr Write-off Expense
Cr Customer AR
59
FI-CA Processes
Accounts
Receivable
Consumptio
n charges from
Billing/Invoi
cing
Miscellaneo
us Postings
Closing
Other
Processes
Security
Transfer
Deposits
to
Interest
General
Dunning
Ledger
Creditworthi
ness
Deferrals
Installment
Plans
Collection
Agency
Write-Offs
ACCOUNT
BALANCE DISPLAY
Transfer
Postings
Loans
Escheatm
ent
Payments
Credit &
Collections
Incoming
Payments
Clarificati
ons
Returns
Refunds
60
61
62
FI-CA Processes
Accounts
Receivable
Consumptio
n charges from
Billing/Invoi
cing
Miscellaneo
us Postings
Closing
Other
Processes
Security
Transfer
Deposits
to
Interest
General
Dunning
Ledger
Creditworthi
ness
Deferrals
Installment
Plans
Collection
Agency
Write-Offs
ACCOUNT
BALANCE DISPLAY
Transfer
Postings
Loans
Escheatm
ent
Payments
Credit &
Collections
Incoming
Payments
Clarificati
ons
Returns
Refunds
63
Transfer Postings
Transfer Postings are used to move open items from one contract
account / contract to another
Items associated with contracts can only be transferred to a contract of
the same division
A clearing document is created for the transferred open item on the
sender account with Clearing Reason Transfer Items, and a new open
item is posted on the receiver account
Some examples of transfer posting scenarios
Transfer of final bill debt from an inactive to an active contract of the same
customer
Transfer of misapplied payments
64
Loans
Some utilities may offer loans to customers if they need to buy devices
related to the service being provided, e.g. energy saving equipment
A lump sum amount is disbursed to the customer, who will then repay
the loan amount in several installments over a period of time
The system supports loans with zero or fixed interest rates
When a loan is created, the system creates
The loan document this represents the monies being disbursed
The repayment plan this specifies the installment amounts and due dates
for the loan repayment
The interest document this specifies the interest amounts due for each
installment
65
Loans (cont.)
Accounting Entries (example loan amount RM600 payable in 3
installments with interest of RM3 with every installment)
Loan Created
Loan Document:
Dr Loan AR
RM 600
Cr Loan AR
RM 600
Repayment Plan:
Dr Loan AR
Dr Loan AR
Dr Loan AR
Interest Document:
66
Loans (cont.)
Accounting Entries (cont.)
Loan Disbursed
Dr Loan AR
RM 600
Cr Cash/Check Clearing
RM 600
RM203
Dr Loan AR
RM3
RM203
Cr Interest Receivable
RM3
67
Escheatment
Escheatment is the process of moving un-cashed refund cheques or
monies in the clarification list to state authorities after a specified period
of time
State authorities to whom monies are escheated need to be set up as
contract accounts
At the start of the escheatment process, letters are sent to customers
last known address informing them of the un-cashed cheques or monies
that will be escheated by a certain date
Once the escheatment date arrives, the escheatment execution takes
place
The refund cheque is voided
A payable is created for the contract account of the state authority
There is no change on the customer contract account
Proprietary and Confidential
68
Escheatment (cont.)
The credit on the State contract account will be processed as an
outgoing payment
Accounting Entries
Escheatment Execution
Dr Refund Clearing
Cr Customer AR [State Contract Account]
Payment Run
Dr Customer AR [State Contract Account]
Cr Refund Clearing
69
Topics
Overview
Contract Account
Document Types and Number Ranges
Account Determination
FI-CA Document
FI-CA Processes
Additional Document Functions
Account Balance Display
70
71
Document Reversal
Document Reversal clears the original document
A clearing document is created for the reversed open item with Clearing
Reason Reversal
Reversals using the FI-CA reversal transaction are not possible for some
document types, as these need to be reversed at the source transaction
Invoice
Security Deposit
Installment Plan
Budget Bill
72
Account Maintenance
Account Maintenance performs manual clearing for individual contract
accounts
Items to be cleared may be manually selected, hence overriding the
defined clearing rules
A clearing document is created for the open item with Clearing Reason
Account Maintenance
73
Reset Clearing
Reset Clearing serves to break the clearing between an open item and
its clearing document
Once a reset clearing has been executed, the status of the cleared item
reverts back to open, e.g. a paid item goes back to being unpaid
Reset clearing is used in cases of misapplied payments or posting errors
74
Topics
Overview
Contract Account
Document Types and Number Ranges
Account Determination
FI-CA Document
FI-CA Processes
Additional Document Functions
Account Balance Display
75
Contract Account
Contract
Division
Main Transaction
Sub Transaction
Due Date
Amount
Clearing Document
Clearing Date
76
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78
79
Summary
What we have learnt
Contract Account
Document Type and Number Ranges
Account Determination
FI-CA Document
FI-CA Processes
Accounts Receivable, Payments, Credit & Collections, Closing, Other
Processes
80
Questions
81