Determining Dunning Levels (SAP Library - FI Accounts Receivable and Accounts Payable)

Determining Dunning Levels

Open items reach a certain dunning level if the number of days in arrears is equal to or greater than the days in arrears specified for that particular dunning level, but less than the days in arrears specified for the next level. When you print the dunning notices, the dunning level is stored in the item.

Example

You have defined dunning levels for your dunning procedure (see below). An open item that is 14 days in arrears would then be assigned to the first dunning level; an item that is 31 days in arrears to the third level, and an item that is 50 days in arrears to the fourth level.

This graphic is explained in the accompanying text

The highest dunning level determined is stored in the master record of the account when you print the letters. This dunning level determines the dunning text and (if one is required) a special dunning form. You can also specify that dunning should be carried out per dunning level. In this case, the highest dunning level of the account does not determine the dunning text or the dunning form; instead, a separate dunning notice is created for every dunning level.

Dunning levels are raised or reduced either by the dunning program or manually:

If you change the dunning level using the line item change or account change functions, you can raise or lower the level as you wish.

If you change the dunning level in the dunning proposal, you can reduce it by as many levels as you wish, but can only raise it by one level. In addition, whether or not you can increase the dunning level depends on the last dunning level: if the dunning program has already raised the dunning level during the dunning run, you cannot enter a higher dunning level. You normally increase the dunning level manually if you unblock a blocked item in the dunning proposal.

The dunning program can only raise the dunning level for line items by one level at a time (from the previous dunning level). This applies even to blocked line items once the block has been removed.

Note

For those customers for whom you have defined bank collection, line items are taken into account according to the following rules:

For items that have a payment method for incoming payments specified in the items, the system checks whether the item is blocked for payment. If it has been blocked, the item is dunned.

If no payment method is specified, the system checks whether a payment method for incoming payments is specified in the master record. If one exists, the system carries out a further check to determine whether the master record is blocked for payments. If it has been blocked, the item is dunned.

If no payment method is defined in the master record, the item is dunned.