Cash Management Project 

Purpose

When a project is being processed, expenditures and costs that affect revenues are incurred on the project. It is of particular importance for the project manager to plan and monitor the payment flow from a project point of view for long term projects, which require intensive capital. You use Project Cash Management for this project-related view of the payment flow.

For more information, see the SAP Library standard documentation, under Logistics ® Project System ® Payments.

The individual steps are normally processed by different employees in their current activities. To explain the process, the steps in this example are listed one after another, and then are all evaluated in reporting.

The following particularly concentrates on monitoring customer payments. The payment update on the credit-side is made when you post the corresponding business transactions during order processing.

Prerequisites

You need to activate Project Cash Management for controlling area 4000.

Process Flow

Customer Payments

  1. You use the billing plan stored in the sales order to plan customer payments. When you update the values to Project Cash Management, the system automatically takes the payment terms into account. The system uses milestone billing to create the billing dates, which are then invoiced to the project earned value accordingly.

You already created the billing plan during order processing. The system created dates for the sales order using milestone billing:

See Creating Billing Plan
  1. The down payment date is unlocked using the corresponding milestone, and a down payment request.

    2. You confirmed the Acceptance Basic Engineering activity during order processing. A billing milestone is assigned to the activity for a down payment. When you make the confirmation, the system automatically unlocks the billing date, so you can create a down payment request.

  2. You post the down payment after the payment has been received.

    3. Posting Incoming Down Payments

  3. During order processing, you confirm more activities. When you confirm the Fundaments activity, you automatically unlock the first partial invoice date.

    4. Confirming an Activity

  4. You create the billing document, in which the down payment already made is automatically cleared.

    5. Creating Milestone Billing

  5. The customer pays the open receivable and you post the incoming payment.

    6. Posting Incoming Payments

  6. To ensure that the payments made are also correctly displayed in Project Cash Management, you transfer the payments when you execute your periodic tasks.

    7. Transferring Payment

  7. You create the second partial invoice in the same way as the first, and then you create the final invoice when the power plant is accepted.

These steps are not relevant for the example process. You can process it in the same way as the partial invoice. To unlock the billing date for the second partial invoice, confirm the Follow-up Assembly activity. To do so for the final invoice, confirm the Final Acceptance business transaction.