Supply chain | Supply Chain Management, Commerce

How can we know the right time to invoice based on incoterms?

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Posted on by Community Member

Hi Experts

We have situations where the customer may have an agreement for 30 day payment terms however, the start of that period is often dictated by the incoterms and that makes it difficult to predict our incoming cashflow. Obviously, once the delivery docket is printed, D365 shows the status of "delivered". In the case of terms like FOB or later incoterms, we can't invoice until these processes occur.

Can someone suggest a method whereby we can define the payment date based on an estimate (or something like that)?

Thanks in advance!

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AshokKumarGuptaEga on at

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Hi DonnaS

We don't have any out of box functionality to determine the payment terms based on estimate. Alternatively you may consider to set the default payment terms and adjust them later on invoice in line with business scenario/process.

Hope this helps to answer your question. If so feel free to mark the thread as answered.

Best Regards

Ashok Kumar Gupta Ega

Sr. T.A, Microsoft

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Community Member on at

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Thanks for your suggestion Ashok but it doesn't really help.

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AshokKumarGuptaEga on at

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Hi Donna,

Regret to know that the suggestion doesn't help. Next you may have to explore the options to customize the solution to meet customer/business specific scenario.

I am also checking internally with our development team for any better solution. I will keep you update once i hear back from the team.

Best Regards

Ashok Kumar Gupta Ega

Sr. T.A, Microsoft.

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Community Member on at

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Much appreciated Ashok.

I did hear about some new feature around revenue recognition... could this possible help?

Thanks

Donna

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AshokKumarGuptaEga on at

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Hi Donna,

I don't expect we can achieve with new revenue recognition feature. Nevertheless you can refer to Revenue recognition overview @ docs.microsoft.com/.../revenue-recognition-overview for more information.

Best Regards

Ashok Kumar Gupta Ega

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AshokKumarGuptaEga on at

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Hi Donna,

Is the above information helpful? If so kindly mark the thread as answered.

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Community Member on at

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Thanks Ashok

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Junaid Idrees on at

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Hi DonnaS,

You cannot use incoterm to manage recognising revenue. What you can do is create shipmenr and in goods shipped not invoiced until confirmation of receipt is received from the carrier and then you can invoice it.

By doing this means the revenue and COGS will be only realised once confirmation is received.

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Community Member on at

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Hi Junaid

You are describing our current process but it lacks the visibility for Finance on an estimated time for receiving the revenue. We have to manually go through the list of Delivered and Not Invoiced every month to estimate when we can expect to invoice the customer and this is what I'm trying to solve in a systematic way.

Thanks

Donna

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Unknown geen idee 132 on at

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Hello Donna,

Did you find out a final solution to the above problem? We are facing the same issue.

Due to Brexit we will change our delivery streams to UK from NL and using a DDP incoterm, hence transfer of ownership lies several days after packing list date ... we would like to default the invoice date at X-days after packing list date.

Thanks,

Koen

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