Handling Intercompany Goods Return in SAP 

Introduction

Managing intercompany goods returns in SAP can be complex, especially when dealing with billing documents and financial reconciliations. In this guide, we will outline the exact steps required to process a Goods Return from a Customer using SAP Support Tickets, specifically for intercompany transfers. 

This article will also address different billing and payment scenarios, ensuring smooth financial adjustments and compliance with SAP best practices.

Scenario Overview

Your company has posted a Goods Issue (GI) to ship materials from your plant to a customer’s plant in Japan (which is also part of your company as an intercompany transfer). However, the receiving plant now wants to return the material due to certain reasons. 

Key Questions Addressed:

1. What are the exact steps to process the intercompany goods return in SAP? 

2. How to handle scenarios where: 

  • The billing document is created, and payment has been received. 
  • The billing document is created, but payment has not yet been made. 
  • The NLCC document type is used for intercompany transfers, and the billing document is already settled. 

Step-by-Step Guide for Handling Intercompany Goods Return in SAP

1. Initiating the Goods Return

To process the goods return, the plant in Japan must initiate a new intercompany transaction in SAP: 
  • Create a return delivery document in SAP to ship the stock back to your plant. 
  • Process the goods receipt (GR) at the originating plant to update inventory. 
  • Adjust financial postings to ensure reconciliation between the two plants. 

2. Key Transactions Required

SAP Transaction Description
VL01N Create an outbound delivery for returning stock.
VL02N Edit or modify the outbound delivery.
MIGO Post goods receipt (GR) against the return delivery.
VF01 Generate a billing document for the return transaction.
VF02 Modify or cancel the billing document if necessary.

Handling Different Payment Scenarios

Scenario 1: Billing Document Created, and Payment Received

If the billing document has already been created and payment has been received, the amount will reflect as a credit balance in the customer's account. To manage this: 
1. Adjust the balance against another invoice for future transactions. 
2. Process a refund if no further transactions are expected. 
3. Create a credit memo (Transaction Code: VF01) to reflect the goods return in the financials. 

Scenario 2: Billing Document Created, but Payment Not Yet Received

If the invoice has been sent but payment has not yet been made: 
1. Cancel or reverse the billing document (using VF02) to correct financial records. 
2. Adjust the outstanding balance in the customer’s account accordingly. 

Scenario 3: NLCC Document Type Used for Intercompany Transfers (Billing Document Settled)

For intercompany transactions using NLCC document type, if the billing document has already been settled: 
  • Reverse the intercompany invoice if permitted under company policy. 
  • Post a debit memo to adjust the account and reflect the return transaction. 
  • Ensure correct inventory adjustments to avoid discrepancies in stock valuation. 

Best Practices for SAP Goods Return Handling

1. Test in Development System First: Before implementing any changes in the production system, test the process in SAP's development environment. 
2. Verify Financial Postings: Ensure the credit memo correctly credits the customer and debits the sales account. 
3. Maintain Documentation: Properly document each step for audit and reconciliation purposes. 
4. Use Correct SAP Transaction Codes: Avoid manual adjustments and rely on standard SAP processes to maintain data integrity. 

Final Thoughts

Managing intercompany goods returns in SAP requires a structured approach. By following the correct SAP transactions and best practices, you can ensure smooth inventory and financial adjustments while maintaining compliance. 

Frequently Asked Questions (FAQs)

1. What SAP transaction is used for intercompany return deliveries?

Use VL01N to create an outbound return delivery and MIGO to process the goods receipt (GR).

2. How do I handle a goods return if the invoice has already been settled?

You can reverse the invoice (if allowed) or post a debit memo to adjust the financial records.

3. Can a credit memo be issued if payment has been received?

Yes, a credit memo (VF01) can be issued, or the balance can be adjusted against a future invoice.

4. What happens if payment is pending for a returned item?

You can cancel the billing document (VF02) or adjust the outstanding balance in SAP.

5. Is it necessary to test the goods return process in SAP before execution?

Yes, always test in a development environment before making changes in production.

6. What document type is used for intercompany transactions?

The NLCC document type is commonly used for intercompany transfers.

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