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Condition Contract Management in SAP S4 hana: Simplifying

Settlement Management
May 4, 2024 by saptutorials

This blog explains the essential configuration steps for Condition Contract Management, a business
process used to manage conditions with suppliers and customers, particularly those requiring
subsequent settlement. The solution comprises the administration of conditions in condition contracts
together with agreements about the relevant business volume and the settlement of condition contract
in order to create corresponding amounts receivable and payable in Financial accounting.

Table of Contents

0.1. Introduction of Condition Contract Management (CCM)

0.2. Understanding Condition Contract Management:
1. Configuration Steps :Condition Contract Management in SAP S4 hana
1.1. Configure Condition Contract Conditions
1.2. Define Condition Tables
1.3. Define Access Sequences
1.4. Condition Contracts for Suppliers
1.5. Define Purchasing Conditions and Activate Them for Condition Contract Management
1.6. Defining Purchasing Condition Type Groups with Purchasing Conditions
1.7. Conditional Contracts for Customers
1.8. Define Sales Conditions and Activate Them for Condition Contract Management
1.9. Defining Sales Condition Type Groups with Sales Conditions
1.10. Other Conditions
 2. Configure Condition Contract Maintenance
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2.1. Define and Configure Parameters for Condition Contract Types
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2.2. Define and Configure Condition Contract Types Why this ad?
2.3. Standard Configuration for Restrictions and Checks
2.4. Enhancements Using Business Add-Ins
3. Configure Condition Contract Settlement
3.1. Configure Business Volume Determination
3.2. How does Condition Contract Management handle accruals?

Introduction of Condition Contract Management (CCM)

Condition Contract Management in SAP is a crucial business process for managing conditions with
suppliers and customers, particularly those requiring subsequent settlement. This system allows for the
administration of conditions in contracts, agreements on business volume, and settlement processes,
leading to corresponding amounts receivable and payable in Financial Accounting. The main elements
for which the configuration must be specified include settings for the condition contract processing and
settlement, as well as settings for the settlement documents which the system creates in a condition
contract settlement. The central configuration parameter is the condition contract type, which contains
settings both for the condition contract processing and settlement.

Understanding Condition Contract Management:

CCM is a system that manages the settlement amount during the settlement process. It involves three
main steps: Configuring Condition Contract Conditions, Configuring Condition Contract Maintenance,
and Configuring Condition Contract Settlement. The first step involves defining pricing conditions for
the settlement amount, including rebate and accrual conditions. The second step involves defining
parameters for conditional contract types and their respective parameters. The third step involves
enhancing existing condition contract types with these parameters. The configuration process follows
the usual pricing procedure for sales orders.

For both purchase-sided and sales-sided conditions contracts, the configuration settings are similar. To
make the required customizing settings, choose Logistics—General Settlement Management. To define
condition tables, define Basic Settings Pricing Maintain Condition Table. For purchase-sided conditions,
define Basic Settings Pricing Materials Management (MM) Define Access Sequences. For suppliers,
define Customizing activity Condition Contract and Conditions Purchasing. To define purchasing
conditions and activate them for CCM, choose Customizing activity Define Condition Types.

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Configuration Steps :Condition Contract Management in SAP S4

hana
Configure Condition Contract Conditions

Customizing settings necessary for defining and controlling pricing conditions relevant for calculating
the settlement amount during the condition contract settlement in CCM. The configuration of contract
conditions aligns with the typical configuration procedure for pricing, akin to that for sales orders. The
Customizing for Settlement Management encompasses corresponding activities to streamline the
configuration task for this solution.
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Settings for Purchase-Sided and Sales-Sided Condition Contracts

Define Condition Tables

To define condition tables utilized for condition types in CCM, access the Customizing activity Basic
Settings ->Pricing Maintain Condition Table.

The condition table typically features the condition contract number as the key field. This field is
denoted as “Condition Contract” in the configuration screen, with the technical field name being
COCO_NUM.

SAP offers examples of condition tables such as 4AB Number and 163 Number/Material in the
standard delivery. The former has the condition contract number as the sole business data-
related key field, while the latter includes both the condition contract number and material as key
fields.

Extending the field catalog for table key fields is required if additional key fields are necessary for
condition tables. This can be achieved through the Customizing activity Basic Settings-> Pricing
Extend Field Catalog for Condition Tables.

Define Access Sequences

To define access sequences for condition types associated with purchase-sided condition contracts in C,
access the Customizing activity Basic Settings ->Pricing-> Materials Management (MM) Define
Access Sequences. Ensure the specification of (blank) Access sequence relevant for pricing as access
category. SAP provides the access sequence COMP CCM: Only Condition Contract in the standard
delivery, containing accesses to condition tables 163 Number/Material and 4AB Number.

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Condition Contracts for Suppliers

To configure contract conditions related to condition contracts with a supplier as the contract partner,
access the Customizing activity Condition Contract Management ->Conditions Purchasing.
Define Purchasing Conditions and Activate Them for Condition Contract
Management

To define condition types related to purchase-sided condition contracts, access the Customizing activity
Define Condition Types. SAP offers exemplary condition types like REBT Rebate and REBA Bonus
Accrual in the standard delivery.

Defining Purchasing Condition Type Groups with Purchasing Conditions

For the utilization of condition types in condition contract maintenance, it’s necessary to group
purchasing condition types in purchasing condition type groups. These conditional then assigned to a
condition contract type.

Conditional Contracts for Customers

To configure contract conditions related to condition contracts with a customer as the contract partner,
access the Customizing activity Condition Contract Management ->Conditions Sales.

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Define Sales Conditions and Activate Them for Condition Contract Management

To define condition types related to sales-sided condition contracts, access the Customizing activity
Define Condition Types.

Defining Sales Condition Type Groups with Sales Conditions

Similar to purchasing conditions, for the usage of sales condition types in condition contract
maintenance, it’s essential to group sales condition types in sales condition type groups. These groups
are then assigned to a condition contract type.
Other Conditions

Configuration for other required condition types follows the same pattern as described above for
contract conditions. Key activities include:

Defining condition tables

Defining access sequences
Defining condition types

Parameters include condition class B Prices, calculation type B Fixed amount, and condition category H
Basic price.

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Settled Rebate: A manual condition type that adopts the calculated business volume amount
from previous settlement runs. Parameters include condition class A Discount or surcharge,
calculation type B Fixed amount, and an initial condition category.

Settled Accruals: A manual condition type that adopts the determined amount for the accruals
reversal within settlement runs. Parameters include condition class A Discount or surcharge,
calculation type B Fixed amount, and an initial condition category.

Configure Condition Contract Maintenance

This document provides guidance on the Customizing settings required for processing condition
contracts in Condition Contract Management. Before proceeding with the configuration, ensure the
following prerequisites are met:

Purchasing condition type groups and/or sales condition type groups have been created, as
described in the “Configuring Condition Contract Conditions” Implementation of ABAP classes
intended for additional checks.

The configuration for condition contract maintenance involves two main steps: defining and configuring
parameters for condition contract types, followed by defining the condition contract types themselves.
Define and Configure Parameters for Condition Contract Types

1. Define Number Ranges: Set up number ranges for condition contract types via Customizing
activity Condition Contract Management Condition Contract Define Number Ranges.
2. Defining Condition Contract Categories: Optionally, group condition contract types using
condition contract categories. conditional activity Condition Contract Management Condition
Contract Define Condition Contract Categories.
3. Define and Configure Field Status Groups: Optionally, utilize field status groups to manage
condition contract header fields. Define these groups via Customizing activity Condition Contract
Management Condition Contract Define Field Status Groups for Header Fields.
4. Define and Configure Status Profiles: Optionally, set up status profiles for custom status
management of condition contracts. Access Customizing activity Condition Contract
Management Condition Contract Define and Configure Status Profiles.
5. Define and Configure Critical Changes: Optionally, define critical changes groups containing
critical changes for condition contracts. Access Customizing activity Condition Contract
Management Condition Contract Define and Configure Critical Changes Groups.
6. Define and Configure Action Profiles: Optionally, utilize action profiles to define actions for the
Post Processing Framework. Access Customizing activity Condition Contract Management
Condition Contract Define and Configure Action Profiles.

Define and Configure Condition Contract Types

1. Defining Condition Contract Types: Define condition contract types with specified parameters.
Access Customizing activity Condition Contract Management Condition Contract Define
Condition Contract Types. Note:
Specify the Type of Contract Partner (supplier or customer).
Specify the Type of Eligible Partners if applicable.
Enter values for configured parameters.
Make further settings to determine layout and processing behavior.
 2. Activate Additional Functions for Condition Contract Maintenance: Optionally, activate
additional functions for condition contract maintenance. Access Customizing activity Condition
Contract Management Condition Contract Activate Additional Functions for Condition
Contract Maintenance.
3. Special Condition Contract Types: Customer, Supplier, and Plant Lists: Configure special
condition contract types to function as customer, supplier, or plant lists. Utilize the “No Contract
Partner” option for the Type of Contract Partner attribute, and specify the Type of Eligible Partners
accordingly.

Standard Configuration for Restrictions and Checks

The condition contract maintenance employs a standard configuration for restrictions and checks,
utilizing ABAP classes. It involves:

Defining restrictions and checks using ABAP classes.

Assigning ABAP classes to table structures and corresponding fields.
Assigning ABAP classes to field chains.
Configuring check categories to control the usage of ABAP classes based on condition contract
scenarios.

Enhancements Using Business Add-Ins

SAP provides Business Add-Ins (BAdIs) to enhance the user interface and processing behavior of
condition contracts. Access Customizing for Condition Contract Management via the activity
Enhancements Using Business Add-Ins Condition Contract Maintenance.

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Configure Condition Contract Settlement

Condition contract the Customizing settings required for processing condition contract settlement. In
the settlement process, the settlement amount is determined for relevant business partners over a
certain period based on business volume .Before configuring the condition contract settlement, ensure
the following prerequisites are met:

Create a database view in the data dictionary required for selecting business volume data.
Configure settlement documents in the Customizing for Settlement Management.
Create factory calendars to be used as settlement calendars.

The configuration for condition contract settlement involves five main areas:
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1. Business volume determination

2. Settlement calendar
3. Calculation of the settlement amount
4. Creation of settlement documents
5. Reversal of accruals

Configure Business Volume Determination

The business volume serves as the basis for condition contract settlement. Typically, it represents a
certain amount derived from business transactions with a partner. Optionally, it can be differentiated
based on parameters influencing the settlement amount, such as merchandise categories or quantities.

1. Define and Configure Profiles for Business Volume Determination: Specify the data source and
information to be selected. Use Customizing activity Define and Configure Profiles for Business
Volume Determination.
2. Define and Configure Field Combinations and Sets of Field Combinations: Define selection
criteria for business volume selection. Use activities Define Field Combinations for Business
Volume Selection and Define Sets of Field Combinations.
3. Assign Profiles and Sets of Field Combinations to Condition Contract Types: Specify the
condition contract settlement type and assign the profile and set of field combinations. Use activity
Specify Settlement Settings for Condition Contract Types.

Extended Configuration with Several Data Sources

Config condition usiness vomanagementmination to involve multiple data sources for flexibility.

1. Define Business Volume Table Groups: Specify sets of business volume tables. Use activity
Define Business Volume Table Groups.
2. Specify Business Volume Table Groups in Profiles: Assign additional business volume tables and
relevant groups. Use activity Define and Configure Profiles for Business Volume
Determination.
3. Define Selection Groups: Specify groups for selection criteria. Use activity Define Selection
Groups.
4. Configure Selection Groups in Profiles: Assign relevant selection groups to profiles. Use activity
Define and Configure Profiles for Business Volume Determination.

In summary, Condition Contract Management is a system that manages the settlement amount during
the settlement process. It includes configuration settings for both purchase-sided and sales-sided
conditions contracts. SAP provides exemplary condition types for settlement amount calculation and
posting accruals, with the Accruals checkbox in the Control data 2 group box selected. Customizing
settings for other conditions are also available, and the system ensures efficient and accurate settlement
processes.

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How does Condition Contract Management handle accruals?

Accruals can be included in invoice creation or separately, enabling businesses to manage financial
impacts without affecting billing, and can be calculated daily or monthly.

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