Tasks to be completed when creating an operating procedure (from creation to publication)
- Enter the Title of the procedure: Description of the operating procedure - Region (APAC, EMEA, LAM, NAM) - Country (Optional) - ERP (PI1, PF1, WP1)
- Add the following Labels :
- Fill all fields as described
- SAP transactions :
- notify them on the right : References , Link the SAP transaction name notified here with the SAP transaction page registered in the file (page adress)
- notify the transaction SAP inside the document in the appropriate place and add a macro : Include Content - Search the name of the page and Save
- Once the procedure is completed, publish it using the SBS-OtC approval workflow
Objective and Scope
The objective of this document is to describe the concepts and guidelines to be applied to manage the Account Receivables ledger in Solvay following the rules and compliance standards on Payment Application, Cash Management and Customer Account clearing.
Receivables - The Concept:
When the invoice is created, the sale is recorded in the accounting system. However, since no money is actually received or paid (sale with credit terms), at that point you cannot record the entry in the bank account. To deal with this, special Asset and Liability accounts are created to record these payments. This is called 'Accounts Receivable' (asset account).
To enter an Invoice (Sale), the entries are the following:
Accounts Receivable (Asset) | $100.00 | Debit (increase balance) |
Product Sales (Income) | $100.00 | Credit (increase balance) |
When a payment is received, the income does not change - consider the sale has already taken place and is recorded. Therefore, this step consists of recording the payment in the bank account and removing it from the AR account.
The payment record looks like the following:
Bank Account (Asset) | $100.00 | Debit (increase balance) |
Accounts Receivable (Asset) | $100.00 | Credit (decrease balance) |
Bank Account payment allocation and Customer Clearing:
Scope
ERP