To process factored sales invoices

Factor invoices without recourse

If you have an agreement to factor all your sales invoices and without recourse, use the following sequence of sessions:

  1. Compose/Print/Post Invoices (cisli2200m000). Print the factor's address on the remit-to address of the sales invoice.
  2. Send Documents to Factor (tfacr2212m000). Select a range of invoices or credit notes and send them to the factor.
  3. Assign the receipts from the factor to the invoices in the regular way. For factoring without recourse, when the full payment is received from the factor the status of the factored document is automatically changed to Settled.

When you send invoices to the factor in the Send Documents to Factor (tfacr2212m000) session, for each selected document, LN checks the total amount for the selected invoices against the business partner's credit limit. Only invoices/ credit notes within the credit limit that you defined in the Pay-by Business Partners By Factor (tfacr0116m000) session are automatically selected. To increase the number of documents that can be factored within the credit limit, LN first selects the credit notes and negative invoices from the specified range.

For details about the financial postings, refer to Factoring without recourse

Factor individual invoices without recourse

If you have an factor individual sales invoices after they have been invoiced and without recourse, use the following sequence of sessions:

  1. Assign Factor to Documents (tfacr2210m000). Assign ranges of invoices or credit notes to a factor.
  2. Assign Factor to Specific Documents (tfacr2211m000). You can optionally use this session to view the documents selected in the Assign Factor to Documents (tfacr2210m000) session, and to refine the selection.
  3. Manually notify the customer that he must make the payment to the factor.
  4. Send Documents to Factor (tfacr2212m000). Send a range of invoices to the factor.
  5. Send Specific Documents (tfacr2215m000). You can optionally use this session to refine the selection of invoices that must be sent to the factor.
  6. Assign the receipt from the factor to the invoices in the regular way. For factoring without recourse, when the full payment is received from the factor the status of the factored document is automatically changed to Settled.

For details about the financial postings, refer to Factoring without recourse

Factor sales invoices with recourse

If factoring is with recourse, use the following sequence of sessions:

  1. Compose/Print/Post Invoices (cisli2200m000). Print the factor's address on the remit-to address of the sales invoice.
  2. Send Documents to Factor (tfacr2212m000). Select a range of invoices or credit notes and send them to the factor.
  3. Send Specific Documents (tfacr2215m000). You can optionally use this session to refine the selection of invoices that must be sent to the factor.
  4. Wait for notification from the factor.

Depending on the situation, continue with one of the following actions:

  • If the customer has paid, you can settle the invoice.
  • If the customer fails to paid, you must repay the factor.

To settle the invoice:

  1. Assign Unallocated/Advance Receipts to Invoices (tfcmg2105s000). Assign the advance payments to the invoices if this was not already done.
  2. Settle, Repay/Unfactor Factored Invoices (tfcmg6200m000). Settle the factored invoice and reverse the entries that create a provision to repay the factor.
  3. Settle,Repay/Unfactor Specific Invoices (tfcmg6100m000). You can optionally use this session to refine the selection of documents to be settled.

For details about the financial postings, refer to Factoring with recourse

To repay the factor:

  1. Settle, Repay/Unfactor Factored Invoices (tfcmg6200m000). Create a credit note for the amount due to the factor. This amount is the amount paid by the factor on the unpaid invoices.
  2. Settle,Repay/Unfactor Specific Invoices (tfcmg6100m000). You can optionally use this session to refine the selection of documents before they are processed. If you selected the Create debit notes while repaying check box in the CMG Parameters (tfcmg0100s000) session, LN creates a debit note for the original pay-by business partner. If this check box is cleared, LN reopens the original invoice.
  3. Repay Advances (tfcmg6201m000). Repay the advance payments that you received from the factor and that are related to the unpaid invoices.
  4. Specified Advances (tfcmg6211m000). You can optionally use this session to refine the selection of advances to be repaid that you generated in the Repay Advances (tfcmg6201m000) session

For details about the financial postings, refer to Factoring with recourse

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