3708630 - Monthly LC charges calculation for partial utilization period - SAP S/4HANA Cloud Public Edition

• LC charges need to be calculated based on monthly intervals, even if the Letter of Credit (LC) is utilized for only a few days within a given month.
• Example: If an LC is created on 28.01.2025 and expires on 10.03.2025, with LC charges set at 1% per month, charges should be calculated as 3% (for January, February, and March).
• Standard interest calculation methods provided in the system are not applicable for this scenario.
• There is no option found to handle this specific requirement directly in the system settings.

SAP S/4HANA Cloud Public Edition

Currently, standard SAP functionality does not support the calculation of LC charges based on monthly intervals for partial utilization periods. However, the following workaround can be implemented to achieve your specific requirement:

1. Create "Once Only" Conditions:

   • For the partial periods (e.g., January 28th to January 31st and March 1st to March 10th), you can use a workaround by creating separate "once only" conditions within the LC Fee setup.

2. Adjust Percentage Rate for Partial Periods:

   • For January 28th to January 31st (4 days), calculate the adjusted LC charges rate based on the full month's percentage rate. Use the formula:
     Adjusted Rate = (Number of days in the month / Actual number of days in the period) * Monthly Percentage Rate
     Example for January:

     • Monthly percentage rate = 1%
     • Adjusted Rate = (31 / 4) * 1% = 7.75%
     • Set this rate for the "once only" condition covering January 28th to January 31st.

   • Similarly, for March 1st to March 10th (10 days):
     Adjusted Rate = (31 / 10) * 1% = 3.1%

     • Set this rate for a separate "once only" condition covering March 1st to March 10th.

3. Normal Condition for Full Months:

   • For February (a complete month), no adjustment is required. Create the condition as per the normal 1% LC charges rate for the month.

4. Apply Conditions:

   • Ensure that all conditions (once only conditions and normal monthly conditions) are applied appropriately within the LC Fee structure when creating financial transactions for the LC.

LC charges calculation, Monthly LC fees, Partial period LC charges, Fee condition for LC, Adjusted percentage rate calculation     , KBA , FIN-FSCM-TRM-2CL , Treasury and Risk Management (Public Cloud) , Problem