Direct Settlements are when invoiced installments are directly subtracted from the goods amount on the sales invoice when the goods are delivered. If the amount of the installment line is less than the value of the delivered goods, the difference is invoiced when the goods are delivered. The revenue from the sale of goods is immediately visible in Central Invoicing.
Indirect Settlements are when invoices for installments do not directly correlate to the delivery of goods. The sold-to business partner can be invoiced for one or more installments in advance. When the order is closed, the invoiced amounts on the installment lines are subtracted from the goods amount on the invoice. The revenue from the sale of goods is only visible in Central Invoicing after the installment order is closed.
Strategic Systems Group, Inc.