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Example documentationExample: Sales Contract with Installment Payment (Milestone Billing)

 

You want to represent contracts in which the payments to be made by the licensee are managed using a fixed fee. Settlement of this fee is to take place for specific milestones. These are specific points in time that you define.

Representation in the License Sales Contract

You grant the licensee the broadcast rights to a three-part English language television play for a specific market, territory and period.

The license amount of $6000 is to be divided into three installments that correspond to the airing dates.

When creating an item in the license sales contract, you can use item category IVM3 (IPM sales rights and royalties item with installments) from the Customizing settings, or a similar item category that you define to represent the milestones.

  • Restrict the content of the right within this item.

  • Record the license amount of $6000 that was agreed to with the licensor with condition type 17F1 (fixed license fee IR) from the Customizing settings, or a similar condition type that you define.

    Note Note

    The system uses the Customizing settings you have made to generate three billing request items for this item. These are used to perform settlement of the installments

    End of the note.

  • Check the milestone dates and the distribution of the amount proposed by the system in the billing plan and change these if necessary.

Result

When the items are released and the contract is saved, the transaction is transferred to billing.