Transportation Settlement in SAP S/4HANA

2.1 Freight settlement process

In this section, we will look at the step-by-step process for creating and posting a freight settlement document.

2.1.1 Creating a freight settlement document

You can create freight settlement documents (FSDs) in multiple ways. Let’s now take a look at these.

Individual FSD from freight order/freight booking

You can create FSDs from a freight order or freight booking document by clicking on the Charges/Settlement button and selecting option Create Freight Settlement Document from the dropdown list. A new window then opens, where you can validate the FSD information. Click on the Post button, at the top of the screen, to perform the posting (see Figure 2.2).

Figure 2.2: New FSD created from freight order

A service purchase order and service entry sheet are created in the background, and then the document flow is updated with the document details. The FSD Business Document Life Cycle Status is updated to Posted (see Figure 2.3)

Figure 2.3: FSD document flow

The service purchase order (PO) and service entry sheet (SES) are only the accrual/liability to the carrier. You can view the service purchase order using transaction ME23N. On the Purchase Order History tab (see Figure 2.4), at item level, the row labelled WE is for Goods Receipt, and the row labelled Lerf refers to Service Entry.

Figure 2.4: Service purchase order

A service entry sheet is equivalent to a goods receipt in the case of a regular purchase order. Note that the service purchase order and service entry sheet are created in one go, as soon as you post the freight settlement document in the background. On the service entry sheet, the system determines the G/L Account and Cost Center, if applicable (see Figure 2.5).

Figure 2.5: Service entry sheet

On the Services tab on the service purchase order, you can see the services which are used for each charge. These services can be one-to-one mapping, or they can be grouped together at service level, according to how you calculated the charges on freight order/freight settlement documents (see Section 2.2.5).

Creating/posting FSD en masse

In a productive environment where a high volume of freight orders/freight bookings are created, it is not a good idea to use manual processing to create FSDs individually for each freight order/freight booking. SAP provides the ability to create FSDs en masse via the options outlined below.

Option 1—Worklists

SAP provides multiple worklists, or personal objects worklists (POWLs), at different levels, in order to carry out mass creation of FSDs, and then to perform different actions. You can use Freight Orders for Settlement – Worklist to create FSDs (see Figure 2.6).

Figure 2.6: Create FSDs from worklist

You can perform various actions such as Post, Cancel Document, Reverse Document, Cleanup Posting, Reprocess etc., using the Freight Settlements worklist. Figure 2.7 shows the different worklists available for freight settlement.

Figure 2.7: Worklists available for freight settlement

Option 2—Batch program

The program /SCMTMS/SFIR_CREATE_BATCH can also be used for creating/posting freight settlement documents en masse. You can schedule this program as a batch job to run at periodic time intervals (e.g., every 3 hours), so the system creates the FSDs in the background and no manual intervention is required. This is the recommended approach.

To do this, you need to set up a variant and pick the correct options within the program, especially the Selection Profile, which defines the freight orders/freight bookings that are relevant for the FSD batch job (see Figure 2.8).

Figure 2.8: FSD batch job creation

If you intend to run a bigger volume of freight orders/freight bookings for FSD creation/posting, you can also set up the Parallel Processing Profile, which helps reduce load on the server.

2.1.2 Error handling and statuses

If an FSD does not post, you will see that the Life Cycle Status reverts to Ready for Accruals on the Statuses tab and the Confirmation Status changes to Purchase Order Creation Failed, or some other error status. This means that the posting failed due to an error, which needs to be fixed. You can view the error details on the Application Log tab in the freight settlement document (see Figure 2.9).

Figure 2.9: Application log tab on FSD

Once you have fixed the errors, you can use the Post or Reprocess buttons to try posting the FSD again. SAP has provided these different options (post and reprocess) because a posting failure can happen at different stages of processing for example, a purchase order was created, but the service entry sheet could not be created/posted, etc.

If an FSD has failed after creating a service purchase order, then you can use the Reprocess option. This option is on a dropdown list that is accessed by clicking on the “…” button, at the top of the screen shown in Figure 2.9.

Table 2.1 outlines the freight settlement document life cycle statuses.

Table 2.1: Freight settlement document—life cycle statuses

In addition to the document life cycle status, there is also a Confirmation Status field at the freight settlement header level, on the Statuses tab, which represents the posting status in ERP. Table 2.2 outlines the confirmation statuses in detail.

Table 2.2: Freight settlement document—confirmation statuses

When you view the status of a freight settlement document, you should look at both the Life Cycle Status and the Confirmation Status in order to understand the overall status of the document (see Figure 2.10).

Figure 2.10: Statuses tab in the freight settlement document

2.1.3 Changes to charges

For various reasons, there could sometimes be changes to charges after you have posted the freight settlement document. For example, the calculation was incorrect and a higher amount was posted, or there was an unplanned charge and you need to post the freight settlement document with an additional charge. This section covers these types of scenarios.

In the settlement profile settings, the Change Process FSD field (see Figure 1.6) defines how to handle charge changes such as those mentioned above. Choose the option Create New FSD for Delta Amount in this field if you want to create a new FSD only for the difference amount for example, an unplanned charge of $100 which was received a week later. If you select Reverse and Repost with New FSD in this field, the system will reverse the original FSD and create a new one for the total amount, including the unplanned charge of $100 from the example above.

If the FSD was posted for an amount higher than expected, you can create a credit memo for the difference amount. For example, an extra $100 was inaccurately calculated on the freight order and the FSD was already posted, and you now want to correct the accrual. You can create a credit memo by using the Follow Up and Create Credit Memo buttons on the freight settlement document. Enter which charge needs a credit so that the right charge is reversed (Figure 2.11).

Figure 2.11: Create credit memo

Once the credit memo is posted, a service purchase order and service entry sheet are created to reverse the amount. Note that the system uses movement 161 to make the reversal (see Figure 2.12).

Figure 2.12: Reversal in MM for credit memo

Self-billing

In a self-billing scenario, the shipper creates an invoice on behalf of the carrier and pays them automatically, and there is no need for the carrier to submit a manual invoice. When differences in amounts occur, as we saw in the example above, a credit memo is usually created.

If you need to cancel the entire FSD, you can use the Reverse Document option at the FSD level (see Figure 2.13). On triggering this action, a credit memo is created for the entire FSD amount, and a reversal is carried out in ERP. Note that Reverse Document is only available when the Life Cycle Status is Invoice Verified.

Figure 2.13: Reverse document option—self-billing scenario

2.1.4 Procuring company code

In the S/4 HANA TM 2020 release, SAP introduced a new feature which enables you to assign a Procuring Company Code to the freight order/freight booking/service order (see Figure 2.14). This enables you to book the freight accruals to Financial Accounting (FI) under the company code.

Figure 2.14: Procuring company code on freight order document

In earlier releases, the TM purchasing organization was mapped to a plant in configuration, and based on that, the system would determine the company code (see Figure 2.15).

Figure 2.15: Assigning purchasing information for posting

With this new feature, you can handle this in the opposite way. You assign a company code to the execution document, which enables you to post accruals to that specific company code.

SAP has also introduced a new configuration node which enables you to assign a default plant to the company code (see Figure 2.16).

Figure 2.16: Assign default plant for company code

To do this configuration, follow IMG path: Integration with Other SAP Components • Transportation Management • Invoice Integration • Invoicing • Mapping of Organizational Units • Assign Default Plant for Company Code.

The plant on the service purchase order is determined as follows:

• based on the configuration in IMG path: Integration with Other SAP Components • Transportation Management • Invoice Integration • Invoicing • Mapping of Organizational Units • Assign Purchasing Information for Posting.
• determined from underlying orders and deliveries, if they are all unique. If multiple deliveries are assigned to a freight order and all of them are related to the same plant, then the unique plant is picked up.
• using the plant defined as the default plant against the company code, in customizing IMG path: Integration with Other SAP Components • Transportation Management • Invoice Integration • Invoicing • Mapping of Organizational Units • Assign Default Plant for Company Code.

When using this option, note that the Procuring Company Code field is mandatory on the freight order. This field flows into the freight settlement document when it is created and is subsequently used further when the service purchase order (SPO)/service entry sheet (SES) is created. If the Procuring Company Code field is blank on the freight order document, then the FSD posting will fail.

2.1.5 Individual and collective FSDs

You can create an FSD for an individual freight order/freight booking/service order or you can collectively create one FSD for multiple freight orders/freight bookings/service orders. For various reasons, you might want to create collective FSDs for example, to get a better discount based on your contract, carrier invoices, collectives, etc., In each of the FSD creation options we discussed earlier, the system prompts you to select the document creation method—individual or collective (see Figure 2.6 and Figure 2.7).

When you create a collective FSD, the system calculates the value of the multiple orders and determines a rate for the collective value. Note that when doing this calculation, the system also groups the rates based on a grouping rule and resolution base that you specify in the calculation sheet (see Figure 2.17).

Figure 2.17: Collective FSD

Now that we have looked at the freight settlement process, we will move on to look at configuration and master data.