This document provides instructions for configuring SAP for inter-company sales and billing. Key steps include: 1. Assigning the delivering plant to the sales organization to determine the billing type as IV for inter-company transactions. 2. Defining the internal customer number by sales organization to identify the ordering company. 3. Configuring the organizational units, sales area, and pricing procedure to ensure the supplying company can bill the ordering company. 4. Enabling automatic posting of inter-company invoices to the vendor account in Materials Management using EDI output.

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2. INDEX
1. INTER-COMPANY SALE 3
2. INTER-COMPANY BILLING DOCUMENTS 5
2.1 Define Order type for intercompany billing 5
2.2 Define internal customer number by sales organization 7
2.3 Assign Organizational units by Plant 9
2.4 Automatic Posting to vendor Account 12

3. 1. Inter-company Sale
BACKGROUND
If one legal company delivers product to the customer, sourced
from the plant, which belongs to another company code, then
the scenario is termed as Inter-company sale
Delivering company bills the ordering company. This is called
as Inter-company billing.
Standard inter-company billing type is IV
Let us take scenario as below:
Customer – 300711
Sales area for creating sales order – 3000/10/00
Delivering plant – 1200
Material is R-1006
Company
code 1000
Company
code 3000
Supply
Customer 300711
Plant 1200Sales org. 3000
Let us understand configuration behind
• Determination of Billing type IV

4. • Payer to which, supplying plant should bill.
• Sales area in which payer should be defined
• Pricing procedure for inter-company billing
• Posting of inter-company invoice in MM
Instructions
Menu path: IMG → Enterprise structure → Assignment →
Assign sales organization – distribution channel – plant
Click
Plant 1200 has to be assigned to sales organization 3000, as it
is a delivering plant.

5. 2. Inter-company Billing documents
2.1 Define Order type for intercompany billing
Instructions
Menu Path: IMG → Sales and Distribution → Billing →
Intercompany Billing
Determination of Inter-company Billing Type
Click
Billing type is based on the order type.
For order type OR, inter-company billing type is IV.

6. Payer to which, supplying plant should bill
Payer 30000 is determined as per the configuration of inter-
company customer for ordering sales organization, 3000.

7. 2.2 Define internal customer number by sales
organization
Instructions
Menu Path: IMG → Sales and Distribution → Billing →
Intercompany Billing
Click
Click

8. Sales area in which payer should be defined
This is the inter-company sales area using which supplying
company, 1000 of supplying plant, 1200 bills ordering
company 3000.

9. 2.3 Assign Organizational units by Plant
Background
This is the inter-company sales area using which supplying
company, 1000 of supplying plant, 1200 bills ordering
company 3000.
This configuration setting enables to determination of Sales
Area as per configuration below.
Instructions
Menu Path: IMG → Sales and Distribution → Billing →
Intercompany Billing
Click

10. Keep cursor on the 1st line and click
Click
Payer 3000 should be defined in sales area, 1000/12/00
Pricing Procedure for Inter-company Billing :
ZIV001.
ZIV1 is the condition type for price that supplying company
1000 will charge to ordering company 3000.
ZIV1 is mandatory in configuration of pricing procdureZIV001.

11. ZIV1 gets price from PI01
This is as per configuration below.

12. 2.4 Automatic Posting to vendor Account
Background
Posting of inter-company invoice in MM:
This is done with the help of MM and EDI expert
Posting in MM is to be done for this inter-company invoice in
company 3000.
This is done using EDI.
Output is RD04 (Invoice receipt MM)
Instruction
Menu Path: IMG → Sales and Distribution → Billing →
Intercompany Billing
The configuration is as below
Click on

13. Keep cursor on the 1st line.
Click
Click

14. Double click on assign vendor

15. Select 3rd entry.
EDI and MM related settings are done with the help of the
respective experts.