A rebate arrangement groups together conditions requiring subsequent (end-of-period rebate) settlement which are valid over a certain time period (for example, a fiscal year) and are due for settlement at the same point in time within this validity period.

Each arrangement is assigned to a certain arrangement type (for example, incentive rebate). Arrangement types are defined in Customizing and contain general information, such as the following:

• Default values (such as the date that is pre-set as the start of the validity period when an arrangement is created)
• Arrangement calendar
• Settlement calendar
• Settlement type (debit-side or credit-side)
• Permissible condition types and their areas of application (such as purchasing organization or site)
• Settlement partner (vendor or customer)

Frequently, arrangements providing for the payment of end-of-period rebates run for a long time or indefinitely. As a result, you can have the system automatically adopt a rebate arrangement that you created for one calendar year (for example) as a rebate arrangement for the next calendar year.

The period of extension is flexibly controlled via the arrangement calendar. Among other things, this facilitates statistical comparisons of a number of years.

The partner concept enables you to record the relevant contact person for each rebate arrangement in the system. In particular, you can record who is responsible for the individual rebate arrangement and who negotiated the conditions of the arrangement.

There are three types of partner:

• Vendors
• Own employees (with HR master record)
• Contact persons (typically condition granters, only in Retail systems)

For each rebate arrangement and each condition you can enter texts that provide additional information, such as the meeting in which the agreement was reached.

Rebate arrangements are subdivided into arrangements that require once-only settlement and those that require periodic settlement.

• Settlement accounting for the former is carried out as per the validity end date of the arrangement.

• Settlement accounting for the latter is carried out at certain points in time, as partial settlement or final settlement, according to the periods specified in the settlement calendar.

In both cases, once settlement accounting has taken place, an indicator is set confirming that settlement has been effected for the conditions of the arrangement. Condition records that have been settled cannot be changed.

Interim settlement can be carried out for both rebate arrangements requiring once-only settlement and those requiring periodic settlement. In this case, settlement accounting extends to those conditions of an arrangement that would not otherwise be due for settlement at this time (because either the end date of the arrangement or the end date of the next period has not yet been reached). In this case, the settlement indicator is not set: the conditions remain active and are taken into account in the next partial or final settlement.