SAP Retro Billing

1. Applies to
SAP ECC; Sales and Distribution;Billing.
Summary
Retro-billing is a process ofissuing creditor debitmemos after retroactive price adjustments
Created on
07 May 2013
Author(s)
Jyoti Prakash
Author Bio
Jyoti Prakash is SAP Certified Associate and works as Senior Resource for Order Management & After Market.
Currently, focused in providing consulting services to their customers for support project on SAP Order
Management, After Market, Project System, and Logistics Execution.
Table of Content
1. Introduction
2. Overview
3. Prerequisite for using on Retro-Billing
A. Billing Document for Retroactive pricing adjustment
B. Condition record
C. Order Reasons
4. How Retro-Billing works on SAP
A. Invoice & condition record - Existing
B. Condition Record - Change
C. Executing of Retro-Billing
5. Related Content
1. Introduction
Out of those various business processes in billing is accommodates & reconciliation ofthe retroactive prices
adjustmentfor number affecting existing invoices.The retroactive prices adjustmentcan be due:
 Strong bargaining power of customer over
 New pricing agreement between supplier
 Volatile/change is price of essential commodities for manufacturing
to name a few.
This kind of prices adjustmentcan be handled by Retro-Billing.For instance,a new pricing agreementthatyou
agreed with your customers mayaffect billing documents thathave already been processed and settled.Ifthat pricing
agreementis effective before the pricing date of the billing documents,you can perform retroactive billing to call up a
listof these documents and revaluate them with the new price. You can then create additional billing documents to
settle any differences.

2. So, by definition & example of retro-billing,it can have a life cycle of months or sometimes beyond a year. Therefore
this makes ita unique process.
2. Overview
Figure 1. Retro-Billing Process
On 01.03.2011,Supplier ships & sells 10 units ofMaterial ABCD to Customer XYZ for INR 58 per unit (valid from
01.03.2011 to 31.12.9999),total amountINR 6653.30.
On 02.03.2011,invoice is sentto Customer for INR 6653.30.
Now on 01.07.2011,due to negotiations price maychange to INR 68 w.e.f. 01.07.2011 (valid till 31.12.9999).Thus
you will update your condition type in TCode VK11 / VK12 for this Material ABCD & Customer XYZ to INR 68 with
validity from 01.03.2011 to 31.12.9999.But as you have already invoiced the customer in pastso,to take care of this
retroactive price adjustmentyou have an extra billing.
So, standard SAP platform provides the retro-billing transaction VFRB. This transaction provides basic retro-billing
functionality enabling identification ofinvoice documents affected by retroactive price changes and execute creation
of multiple documents.
In Retro-billing,enter the selection criteria like Payer, Sales Organization,Billing date from & to, Pricing type,
Currency, Sold-to Party & Material.

3. By this systemwill provide you the list of invoices to which this retroactive price changes is applicable and hence
you can simulate or even execute retro-billing & system will accordingly generate Credit/Debit memo type based on
differential amount.
For positive retroactive price changes,i.e., INR 10 per unit price from former as INR 58 & revised as INR 68. In this
case system will generate DebitMemo for the differential amountto be collect receivable from Customer.Whereas,
for negative retroactive price changes,i.e., INR 15 per unit price from former as INR 58 & revised as INR 43. For this
case system will generate CreditMemo for the differential amountto be pay back the differential amountto
Customer.
These documents will getbe in documentflow of the original invoices.
3. Prerequisite for using on Retro-Billing
A. Billing Document for Retroactive Pricing Adjustment
1. Retro Debit Memo
2. Retro Credit Memo
3. Corresponding relevant CopyingControl
4. Pricing procedure for capturing price change
B. Condition Record
1. The value for base price should determined automatically in theinvoice through condition record
2. It should be maintain on thebases of Material & Customer combination
3. It should be a have valid validity from & to date
C. Order Reasons
You need to maintain proper order reasons specific to retro billing document typefor Credit/Debit memo.
4. How Retro-Billing Works on SAP
A. Invoice & Condition Record - Existing
You can use TCode VF05N for listof billing documents or invoices based on
 Billing Document Date (to & from)
 Billing Type,
 Customer & Payer,
To view desired invoices with currentbase prices use TCode VF03.
In invoice, check item data – condition tab to view pricing.

4. In the invoice, to view corresponding maintained condition record for condition type, say, ZPR0. Selecting the
condition type and click on button to view the maintained condition record.
B. Condition Record - Change

5. For changing in the existing condition record for base price condition type use TCode VK12. Choose keycombination
as Customer/Material.
Provide the desired parameter for execution the condition records.
Maintain the change in price difference. Say, positive difference of INR 10 from former price INR 58 and revised
price INR 68.
C. Executing of Retro-Billing
Use TCode: VFRB for exercising retro-billing option.Provide following parameter based on your requirement, but
keeping mandatoryfields in mind:
o Payer (Mandatory)
o Sales organization(Mandatory)
o Billing date from(Mandatory)
o Billing date to (Mandatory)

6. o Pricing type(Mandatory)
o Currency(Optional)
o Sold-to party(Optional)
o Material (Optional)
You have a option of include Invoices with the Same Net Values. This indicator defines whether invoices whose current
net value is the same as the post-calculated netvalue should be included in the retro-billing list.
o If the indicator is set, invoices with the same prices are included.
o If the indicator is not set, invoices with the same prices are not included
For instance,Invoice was created with a price of 100 Units.After the unitprice is reduced to 50 Units, the retro-billing
listis used to create a coupon for 50 Units.If you discover later that this price reduction was incorrectand you set the
price back to 100 Units,a retro-billing listonlyappears ifthis indicator is set.
Below you can find details of entries without error

7. Select the desire invoice/invoices for the listof entries withouterror and click on button for simulation
run.
Then following screen will appear for simulation run.
For generating Retro Debit/Credit memo click on button.
You can click on button for viewing the generated retro billing. Green indicator confirms that the document
generated without any
errors.
Subsequently you can view the generated Debit memo from retro billing by using TCode VF03.
5. Related Content
 SAP Library: Retro-Billing
 SCN Message ID 9537098: Retro Billing - Normal Sales Process
 SCN Thread ID 874041: Retro Billing
 SCN Thread ID1793527: Retro-Active Billing - Config. Guide
 SCN Discussion Retro-billing Pricing
 SAP Note1263240 - VFRB: Performance during mass processing

8.  SAP Note81382 - Notes on the retro-billing list with examples
Disclaimer and Liability Notice
This documentmaydiscuss sample coding or other information thatdoes notinclude SAP official interfaces and
therefore is not supported by SAP. Changes made based on this information are notsupported and can be
overwritten during an upgrade.
SAP will not be held liable for any damages caused byusing or misusing the information,code or methods suggested
in this document,and anyone using these methods does so athis/her own risk.
SAP offers no guarantees and assumes no responsibility or liability of any type with respect to the content of this
technical article or code sample, including any liability resulting from incompatibility between the content within
this document and the materials and services offered by SAP. You agree that you will not hold, or seek to hold, SAP
responsible or liable with respect to the content of this document