Rebate Processing

Rebates: Rebate agreement is a special agreement granted to the customer on

a specific volume of sales over a specific period of time.

Configuration Path:
IMG>SD>Billing>Rebate Processing>Rebate Agreements>Define Agreement
Types>

Step 1: Define Agreement Type

Select Define Agreement type from choose activity, double click on it

Select an Agreement click on copy button and rename it

Here I selected standard and renamed 0002-Material Rebate to Z002- Material Rebate-AA11

Step 2: Condition Type Groups

2.1: Click on Define condition Type groups

Click on New Entries
Enter your Copied Condition Type group which you created and Maintain Blank for
Category of the condition type group

Step 2.2: Assign Condition Types /tables to Condition Type groups

Click on New Entries

Assign Condition Type Bo02 and Condition Table 1to your Condition Type GroupZ002

Step 2.3: Assign Condition Type groups to rebate agreement types

Click on it, Assign Condition Type group to Agreement Type

Step 3: Condition Technique for Rebate Processing

Click on it
Same as like Pricing Procedure configuration
Step 3.1: Select Maintain condition table for Rebates
Select Maintain Condition Tables for Rebate and Click on Choose
Based on requirement we can create new condition table
Save and exit (if anything created)
3.2: Maintain Access Sequence
Select Maintain Access Sequence
Click on Choose, Go to New Entries and Maintain Access Sequence
Maintain 1 Relevant for Rebates
Step 3.3: Define Condition Types:

Choose Define condition types

Select it and click on Choose
Rebate condition types (BO01, BO02, BO03, BO04, BO05, BO06)are available in Standard SAP
Assign Access sequence to condition Type (if copied)
Step 3.4: Maintain Pricing Procedure:
Select Maintain Pricing Procedure and click on Choose
Choose Standard or copied Pricing Procedure by use
Click on Position Button left side Dialog Structure
Make sure that Rebate condition types must available in (copied) pricing procedure
With Requirement-24 (only in Billing Document)

Account Key ERB

Accruals ERU

Step 4: Account Determination for Rebates

(If your are good at Account determination Procedure configuration no need to fallow this)
The same process like Account Determination Procedure
Step 4.1: Define A/C keys
(Standard keys available in SAP)
ERB -Rebate Sales deduction
ERU Rebate accruals
Step 4.2: Assign Account Keys to our Pricing Procedure
In standard pricing procedure its available
Steps 901 to 905

Step 4.3: Maintain Access Sequence

(standard already created like Accounting Determination Procedure)
Step 4.4: Define Account Determination Types
Assign access sequence to Condition type
Step 4.5: Assign G/L Account
Choose table 1-customer group/Material Group/Account Key
Click on Assign button and Maintain G/L Account Provision Account

Step 5: Activate Rebate Processing

IMG>SD>Billing>Rebate Processing>Activate Rebate Processing

Click on Activate Rebate Processing

Select Billing Documents for Rebate Processing in Choose Activity.

Step 5.1: Select Billing Document for Rebate Processing

T-Code: OVB0

(Or) T-code: VOFA

Enter billing Document Type and put check mark for Relevant for Rebates
Go back, Select Activate Rebate Processing for Sales Organizations
Step5.2: Activate Rebate processing for sales organization
Click on Choose

(Or) Go to Enterprise structure

T-code: OVX5
Select your sales organization
Put check mark for Rebate process Active

Step 5.3: The payer must be relevant for rebate processing.

Go to XD01 or XD02 Payer customer master record
Go to sales are data tab then choose Billing tab put check mark for Rebates

Step 6: Create Rebate Agreement

T-code: VBo1 or SAP Easy Access Path
SAP Menu>Logistics>Sales and Distribution>Master Data>Agreements>Rebate Agreement
(VBO1-Create/VBO2-Change/VBO3-Display)

Choose created one (Ex: Z002)

Specify the rebate recipient [Customer master payer number]

Specify the validity period of the agreement
Specify the agreement status: Blank [] = Open
Specify the verification level [F] = Display totals by Payer/Material

Then click on Conditions on top

Maintain (Accruals amount) condition record for material rebate how much rebate we want to give it
to the customer

If we click on scales button

Here I maintained for each product 1 rupee

go back

save it.
With this configuration part is completed

Step7: create sales order

T-code: VA01
Specify Organizational details
Press F8(document Complete)
Check item conditions
Save it

Step 8: Create Delivery

T-code: VL01n

Step 9: create Billing document

Check ITEM conditions BO02 will display in conditions tab because we maintained requirement 24
in our pricing procedure

save it
Now Rebate Settlement to customer

Step 10: Go to VBo2 rebated agreement

Enter rebate agreement which we created
Ex: 34

Check agreement status to B

On the menu bar choose Rebate Payment

Here Customer is eligible for 50 Rs rebate accruals amount

If we observe Verification Levels
Will get details of payer customer master total rebate accruals amount

We can settle the rebate amount by manual or automatic

Manually we can select the customer eligible amount

Then we can save it

It will create automatically credit memo request
Here I have chosen 5Rs/- and save it

We will get the message like this bottom of the screen.

Or if we want to give full settlement to the customer click on

It will create automatically Rebate Request for Manual Accruals for entire eligible pending amount.
It will happened in the back ground
If we want to check that go to this path or Click T-code: VOV8
Select any one of the above document type
B1, B2, B3 OR B4 click on details icon

Coming back to Rebate credit memo request

Back ground automatically created we can check these details by using T-code: VA03
Now create Billing Document by using sales order number
Check the conditions
Save it
Billing document will be generated
Rebate accrual amount 5Rs

Check Accounting Document

General ledger view

With this Rebate agreement process is completed.

How to do rebate processing

Purpose
This wiki page will discuss how to do rebate processing in Sales and Distribution.

Introduction
Its a special discount that is accumulated based on sales volume over the period and paid retroactively to the desired
customer.

It can be based on :

Material

Customer

Customer Hierarchy

Group of Materials

Example
Say, you have agreement with your customer. That if they go for a business worth of Rs.10 Million in 1 year. Then you would
provide a discount of 3% on total sales in the year, which will be paid to them retroactively at the end of decided period.
Accordingly you create/updates a rebate agreement. Now, if at the end of the year the customer DOES achieve the target.
Then you offer them whatever is decided. The rebates are passed on to the customer in the form of Credit Notes. Therefore,
rebates are more or less discounts which are offered to customers. The rebates are based on the volume of the business
the customer does with you within a specified time.

Components of Rebate Process

Rebates process in SAP is divided into three components
1.

Configuring Rebates.

2.

Setting Up Rebates.

3.

Managing rebate agreements and payments.

Pre-requisites
Following are the pre-requisites for processing rebate.

1.

Payer Customer Master

The payer partner needs toi have the rebate field checked in
the customer master on the sales area-billing doc tab.

2.

Billing Document Type

The billing type must be marked as relevant for rebates.

3.

Sales Organisation

The sales organisation must be marked as relevant for rebates.

Rebate & Condition Technique

Rebates, use the condition technique, but distinguish themselves from pricing in applying to transactions over time, versus
on a transaction basis.

Condition

Rebates have their own field catalog and their own condition table naming convention. So you could have two

Table

condition table "001" one for pricing and one for rebates, which could have different key fields.
Additional Information
You need to use the technical names A001 for pricing and KOTE001 for rebates when you use the query type using
transaction SE16 or SE16N.

Access

Create access sequence (ASeq.). Enter 1 in field category for rebate specific. ASeq. after going through the right

Sequence

path of maintaining ASeq for rebates.

The big difference between the rebate and the pricing access sequence is that there is no exclusion flag available
for rebate related ASeq. This means multiple tables for an access sequence can be applied at the same time.

Condition

Rebate related condition types are identified by condition class - C.

Type

After defining and creating condition types for rebated include them in the pricing procedure. The requirement
should be 24 here which imply that the accruals are calculated on the basis of invoice/bill.
The other fields Alctyp and Altcbv does not allow you to manipulate how a rebate is calculated. Also, remove the

requirement 24, if you want to see rebates at order time. That means with this requirement rebate accrued value
will reflect once billing document is created.

Payment of Rebates
Payments can be done

manually
in full settlement
on the accrued amount.
When you do manual payments, it defines how much can be paid out during a partial settlement. You use partial settlement
only when rebate agreement is defined for a full year but the payouts are supposed to happen on a specified period, such
as, monthly, quarterly or any other.
These accruals are based on sales volume and when they are posted billing is created in the following manner:

Account Entries

Debit (Dr)

Provision for accruals

100

Credit(Cr)

to Sales Revenue

100

When rebate credit memo is created

Account Entries

Debit (Dr)

Customer account

100

to Accrual provision account

Credit(Cr)

100

The rebate can be given to the customer at one time or in installments also.
This is broadly the outline of the rebate process.
Note : I recomend you to study the theory part of why rebate and why not a discount.
This will help you understand better.
May be I can help you with rebate process.(IN -IMG)
1. define a rebate agreement type
2. define a condition type group
3. define a condition type and place this condition
Type in the pricing procedure.(REQUIREMENT=24)
ALSO IN THE PROCEDURE- ACCRUAL KEY = ERU
YOU ALSO HAVE TO DO THE ACCOUNT DETERMINATION FOR REBATES.
Once you have defined all the 3 and assignment starts.
Assign the agreement type to the condition type group
Assign the cond type group to the condition type.
Condition technique is also used in rebates.
REBATE ACTIVATION- IN CUSTOMER MASTER, SALES ORGANISATION AND FOR THE BILLING DOCUMENT.
After having done this please proceed to maintain the condition record for the rebates (transaction code-vbo1)
Note: if you maintain the requirement coloumn with the requirement as 24 - the rebate will be affected in the billing document
and if you dont give the requirement as 24 your rebate will be affected in the sales order.
The rebate process is completed when you have created a credit memo to the customer.
The document type for the partial settlement is R3.
Please make sure you open two screens SO THAT YOU CAN COMPARE THE NEW ENTRIES WHAT EVER YOU'RE
DEFINING WITH THAT OF THE STANDARDS or first you try with the standard condition type boo1, boo2
boo3 boo4.
AFTER YOU HAVE FINISHED A COMPLETE SALES CYCLE OF CREATION ORDER , DELIVERY AND BILLING.
GO TO THE CONDITION RECORD IN CHANGE MODE (VB02) AND SETTLE THE ACCOUNT PARTIALLY.
In a simple way,
1. First you need to create a Rebate agreement.
2. Create condition record for rebate giving the rebate rate and accrual rate.
3. when the rebate relevent billing doc is generated, the rebate and accruals are determined and posted in a seperate GL
account as a noted item - amount to be settled. Also it gets copied in the rebate agreement.
4. create settlement run using credit memo request and then credit memo to settle this amount with the customer.