Dunning

Every time goods or services are sold, the liabilities of the respective customer(s) to the business are
increased. From that moment, incoming payments are monitored to ensure that customer debts are paid
on time. When they are not, the company needs to activate a multilevel collection process, such as
telephone or written reminders, for the remiss customer.
SAP Business One provides a dunning wizard for producing reminder letters. It runs through all the
customers, checks all outstanding A/R invoices and transactions that represent debt, and enables you to
print and send reminder letters of different levels of severity. In addition, the dunning wizard lets you
automatically post service invoices for interest and fees charged with a dunning letter.
The dunning system covers the following documents:
Open A/R invoices, including invoices that are partially credited or partially paid
Invoices that include installments
A/R credit memos
Incoming payments that are not based on invoices
Manual journal entries with at least one row posted to a customer
Opening and closing balances transactions
To use the dunning wizard, you must first set preliminary definitions.
The following describes the setup of the dunning process and explains the results of running the wizard.
Prerequisites
To run the Dunning Wizard, you have defined:
Dunning interest and dunning fee accounts, on the Sales tab in Administration Setup
Financials G/L Account Determination to be able to automatically post interest or fees using
service invoices
Dunning terms, in Administration Setup Business Partners Dunning Terms
Dunning terms are based on dunning levels and contain parameters and values required for the
dunning process run.
Default Dunning Term for Customer , on the BP tab in Administration System Initialization
General Settings
Dunning terms for customers, in the Dunning Term field on the Payment Terms tab in Business
Partners Business Partner Master Data
You have used the following options to exclude irrelevant A/R invoices from the dunning process:
To exclude a specific invoice:
Display the invoice before running the wizard. 1.
On the Logistics tab, select Block Dunning Letters .
You can deselect the option later to include the invoice in any future dunning process.
2.
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To exclude all invoices created for a specific customer:
Display the Business Partner Master Data record for that customer. 1.
On the Accounting tab, select Block Dunning Letters . 2.
Process
You choose Sales A/R Dunning Wizard and follow the procedure below. In each step, you
choose:
Next , to proceed to the next step of the wizard
Back , to return to the previous step
Cancel , to cancel the dunning wizard creation
Step 1: Wizard Options. Select whether to run a new dunning wizard or to load a saved one. 1.
Step 2: General Parameters. Modify a name of the default dunning wizard and choose a dunning
level.
2.
Step 3: Business Partners Selection Criteria. Choose a range of customer codes for the wizard. 3.
Step 4: Document Parameters. Enter the range of the posting or due dates to include in the wizard.
In addition, select the relevant document types and other letter parameters, for example Allow
Negative Dunning Letter and Display All Open Items .
4.
Step 5: Recommendation Report. Enter a new date until which payments are expected and select
invoices that are included in the wizard for each customer. Specify whether to automatically post
interest or fees and create service invoices for this purpose.
5.
Step 6: Recommended Service Invoices. If you selected automatic posting of interest or fees for the
dunning letters, you can view the recommended service invoices and decide whether to add them.
6.
Step 7: Processing. Select one of the following options to process the dunning wizard:
Save Selection Parameters and Exit
Save Recommendation Report as Draft and Exit
Execute Only, Print Later and Exit
Print Dunning Letters and Exit
7.
Result
When you execute the dunning run, the dunning level and the last date of the dunning letter are updated for
overdue invoices included in the dunning run. When you create a dunning letter for a customer, the
business partner master data record is updated. On the Accounting tab, the Dunning Date field displays
the date on which the dunning letters were created for the last time.
If you chose to automatically create service invoices for interest or fees, the respective service invoices
are created. The summary report in step 8 of the wizard shows which dunning letters have been created
and which errors may have occurred.
To view the history of dunning letters and the list of all invoices, choose Business Partners Business
Partners Reports Dunning History Report .
More Information
Dunning Levels - Setup Window
Dunning Terms - Setup Window
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