Process Letter of Credit in M3

This document explains how you administer and keep track of the various steps when involved in international trade controlled by a letter of credit.


The different steps in the transaction are reflected in a change of status. Documents involved are listed and registered for the letter of credit.

The letter of credit is connected to one purchase order or one customer order. If the letter of credit is used for import purposes, a request to open a letter of credit is also printed.

Depending on the options used, any changes are recorded in a history file.

Use the information to re-evaluate the company's letter of credit policy for its foreign customers or suppliers.

To track changes in a letter of credit, create a query in the history files (CLOMFH), (CLOOHF) and (CLODHF). (This assumes that options with automatic logging were used when processing the letter of credit.)

See Managing Trading Risk.

Before you start

Follow These Steps

  1. Start 'Letter of Credit. Open' (RMS100/B).

  2. Update the status of a letter of credit:

    1. On the B panel, select Change for the letter of credit.

    2. On the E panel, manually update the status. Press Enter.

      Note: Note that there is a logical flow in the the status setting. Depending on where in the process the letter of credit is, you can only enter certain statuses. Some statuses are only set automatically.
    3. Press F3 to return.

  3. To print a request to the bank for opening a letter of credit for import:

    1. In (RMS100/B), select option 6 = 'Print bank request' for the letter of credit.

      Note that this is only permitted for letters of credit with status 20 or 28.

    2. On the J panel, enter the date to be printed on the request. Press Enter.

      Order numbers and names of standard documents to be included in the letter of credit are printed on the request as well.

  4. Connect a letter of credit to a purchase order or customer order:

    1. In (RMS100/B), select option 11 = 'Connect orders' for the letter of credit.

      Note: The letter of credit must have status 10 = Preliminary.

    2. In 'Letter of Credit. Connect Orders' (RMS101/B), enter an order number.

      Depending on the letter of credit type, a list of purchase orders or customer orders is displayed by pressing F4 in the field.

    3. If you need more information, select option 12 = 'Display PO'/'Display CO' for the order and review the order in 'Purchase Order. Open' (PPS200) or

  5. Connect documents to a letter of credit:

    1. In (RMS100/B), select option 12 = 'Connect documents' for the letter of credit.

      You can do this for letters of credit with statuses 10 to 85.

    2. In (RMS102/B), select a previously registered document in the 'Document number' field. Click New.

    3. In (RMS102/E), adjust the proposed name, when necessary, and enter the number of copies (required). Press Enter.

  6. To log any changes made, launch (RMS100/B) and select one of these alternatives:

    • Select option 22 = 'Change with log' for a letter of credit when updating it.
    • Select option 24 = 'Delete with log' when permanently removing a letter of credit.

      These options are identical to options Open and Delete except that all changes are logged in the history file. The information in the log file can be retrieved by creating a query.

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