Understanding Credit Control Parameters.

Understanding Credit Control Parameters.

Credit Status at a Customer Level is Auto Identified based on rules which can be configured on Following Parameters:

        • Credit Limit Utilisation
        • Overdue Limit Utilisation
        • Overdue Amount
        • Outstanding Amount
        • Credit Limit 
        • OverDue Limit

How is Credit Limit Utilisation Calculated : (Credit Limit - Net OS) 

                                                                           = Credit Balance / Credit Limit * 100

                                                                           = Un utilised Credit % - 100

                                                                           = Utilised Credit Limit

Let us understand the above calculation with an example.

For Example - Customer - Vipra International

                         Credit Limit Set - 2,00,000/-

                         Net Outstanding - 1,50,000

 Hence Credit Limit Utilised Against Vipra International = (2,00,000 - 1,50,000)

                                                                           Credit Balance = 50,000

                                                                 Un Utilised Credit %  = 50,000/2,00,000 * 100 = 25%

                                                                         Utilised Credit % = 25 - 100 = 75%

 Therefore 75% of the credit is utilized by Vipra International.                                                             

How is Overdue limit utilization calculated:    Overdue Limit - Net OS

                                                                            = Overdue Balance / Overdue Limit * 100

                                                                             = Un Utilised Over due Limit % -100

                                                                             = Utilised Over Due Limit 

Let us understand the above calculation with an example.

For Example - Customer - Vipra International

                         Over Due Limit Set - 10,00,000/-

                         Net Outstanding - 9,00,000

Hence Over Due Limit Utilised Against Vipra International = (10,00,000 - 9,00,000)

                                                             Over Due Limit Balance = 1,00,000

                                                          Un Utilised Overdue Limit % = 1,00,000 /10,00,000 * 100 = 10%

                                                                 Utilsed Overdue Limit %  = 10 - 100 = 90%       

    Therefore 90% of the Overdue limit has been Utilised against the Vipra International Customer.

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Below Rules Can be Configured against the Customer for Credit Control Activation.

This rule can be customized from Company to Company

  • High Risk - Credit Limit Utilisation % >= 99 or Overdue Outstanding Amount > 0
  • Moderate Risk - Credit Limit Utilisation % >= 75 and Credit Limit Utilisation % < 99
  • Approved (Low Risk) - Credit Limit Utilisation % < 75

By Setting the above rules following actions will be triggered.


Triggers
Shipment Creation and Order Creation  - 

Action: Create Shipment and the order is blocked

After creating the Shipment and Order 

Action: Shipment will go on Hold and further actions will be blocked  
Document release trigger 

Action: Release of Document is Blocked

At the time of handover set printing - MAWB and HAWB

Action: Final Printing of MAWB and HAWB will be Blocked

At the time of the HBL Release

Action: Release of HBL to the customer is blocked.


At the time of MBL given to the customer

Action: Release of MBL to the customer  will be blocked


At the time of DO Printing in import shipment 

Action: Final printing of DO and sharing on email is blocked

 

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