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How To Manage Condition Contract On Your SAP S/4 HANA Cloud ?

Every SAP S/4 HANA Cloud user knows that the conventional concizeable solution made accessible through the SAP enterprise resource planning solution lacks flexibility. Besides that, there were also issues with significant blockages with tables that harbored the rebate entries. This meant one had to rebuilt the table VBOX every time there were any changes in scenarios of customers. 

Fortunately, these issues were addressed with the launch management of condition contract, which is a new standardized and new central solution for such hurdles. The solution was devised to settle the complications with conditions for customers and suppliers. The condition contract management feature covers several upsides advantages compared to the conventional agreements of rebates in the advanced SAP ERP 6.0. 

Types Of Conditions

You can use two different condition contracts in your SAP S/4 HANA Cloud. These conditions include:

Conditions That Accompany Invoices

Conditions that accompany invoices cover every type of situation that becomes valid immediately. Such conditions generally can change the sales order value item. For instance, situations such as discounts, prices, and surcharges come with an invoice. Users can edit and store such formatting in the contract condition. Such conditions generally act as the primary objects to help one can define the validity periods, view available elements of text and add notes on them, and even make explicit conditions active. 

Conditions That Require Subsequent Settlement 

Every condition that is meant to be settled later falls under the subsequent factor. These conditions require subsequent settlements when you create a contract. Therefore, one needs to provide the dates of settlements, information for calculating the volume of business that determines the validity dates, and the amount of settlement. You can even post the accruals after creating invoices.

Besides, you get an alternative in case you do not wish to disturb the process of billing. This means users have the liberty to facilitate configuration for creating accruals necessary for the rebates availed of by customers and conduct them separately. For instance, you can calculate the accruals based on months and even dates. Further, you can also settle the condition contracts through manual or automated procedures. For example, one can incorporate starting days when creating contracts with a start date from the past. 

All in all, this feature comes as an excellent addition to SAP S/4 HANA solution as one can now create the condition contracts after using the transactional documents to calculate the business volume that has been posted.

Primary Steps Of Configuration

There are three different ways one can configure the condition contract management. These types include:

Configure Pricing That Includes Condition Contract Conditions

This is the step for configuration that is primarily focused on two different areas. The first is the generic settings used for all prices related to sales. The second is the explicit settings for different contract conditions associated with contracts with any customer as the partner.    

For all prices for orders of sales orders, one needs to define all access condition types, condition tables, sequences, and even the pricing procedures. Following this next step will be to define the types of sales conditions and activate the same for effective management of condition contracts. The standard system will provide you with two different types of conditions. The types include:

  • RES1: Rebate
  • REA1: Rebate Accruals 

Following this, one will need to define the types of sales condition groups and assign the types of sale conditions to every specific type group of sales conditions. 

Configuring Condition Contract Management

The second step of configuration that requires users to configure and define all different parameters for the types of condition contracts. This includes the categories of condition contract, number ranges, status profiles, groups of field status, procedures for determining texts, and action profiles. 

After this, you will need to define the types of condition contracts with the parameters that have to configured. This will help you determine the way a condition is to be processed. Furthermore, the field that depicts Contract Partner Type will remain mandatory when defining the types of contracts. This is because this field helps to determine if the partner of contract here is a supplier or customer. 

The field bearing the title Eligible Partners Type will also remain mandatory because it helps specify if the partners are eligible to play the specific role for condition contract type. 

Configuring Settlement Condition Contract  

It is imperative to ensure the maintenance of a couple of settings in the final step. This is important because it allows the processing of the settlement of condition contract by the system and eventually calculate the amount for any given period. 

  • Specifying Settlement Calendar: This requires one to define all factory calendars that are to can be used as calendars settlements and assign the same to all relevant types of condition contracts. The calendar you allot for the type of condition contract will remain the default calendar. However, you will still have the option to overwrite the value of the tire’s actual contract condition. 
  • Configuring Business Volume Determination: In most cases, this value is primarily based on the total amount of invoices associated with the customers. 
  • Specifying Reversal and Posting of Accruals: This specific configuration setting will help you reverse all the accrual postings. Once reversed, you can replace the same with the real amounts that have been determined when the settlement of the condition contract.  

In Conclusion 

As you can see, this is more or less all you need to know about managing condition contracts in your shift to SAP S/4 HANA Migration. So, leverage this information and make the most of the condition contract functionality in the SAP S/4 HANA Cloud solution.