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Accounting in ERP Systems
Frequently, companies do not configure the system to provide warnings to sales order
clerks because they are not equipped to correct the problem and because the credit
problem is an issue between the selling firm’s Accounts Receivable Department and the
customer’s Accounts Payable Department. Rather, a person in the credit management
function regularly reviews all blocked sales orders and resolves the credit problem directly
with the customer.
Figure 5-5 also shows that the credit check is dynamic and has a two-month horizon.
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This means that only the next two months of sales orders will be used in calculating the
credit check. Customers may place orders for a long-range schedule, but only those that
will be shipped in the near term are usually considered in the credit check.

Dynamic credit
check with
Reaction C
selected

Two-month
credit check
horizon

Source Line: SAP AG.
FIGURE 5-5 Credit management configuration

Figure 5-6 shows the credit-checking process in Figure 5-5 applied to a specific
customer, Health Express. Health Express has a credit limit of $1,000 and currently has
used $590 of this limit. If Health Express places an order for snack bars that totals more
than $410, the order will be blocked.

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