How To Fix MN172 - Settlement type &1 not allowed (function module &2)

MN172 - Overview

• Message type: E = Error

• Message class: MN - Message class for subsequent settlement (Purchasing)

• Message number: 172

• Message text: Settlement type &1 not allowed (function module &2)

What causes this issue?

Valid settlement types are:

The system issues an error message and will not allow you to continue with this transaction until the error is resolved.

0 - credit-side settlement at plant level (supplier billing document)
1 - credit-side settlement at purchasing organization level (supplier
billing document - up to Release 4.0D, also credit memos from
Invoice Verification)
2 - debit-side settlement at plant level (customer billing document)
3 - debit-side settlement at purchasing organization level (customer
billing document)
The affected rebate arrangement is &V3&.

System Response

Contact your system administrator. It will probably be necessary to
alter the program (internal program error).
The error occurred in function module &V2&.

Error message extract from SAP system. Copyright SAP SE.

Smart SAP Assistant

• What is the cause and solution for SAP error message MN172 - Settlement type &1 not allowed (function module &2) ?

  The SAP error message MN172, which states "Settlement type &1 not allowed (function module &2)," typically occurs in the context of settlement processes in SAP, particularly when dealing with internal orders, projects, or cost centers. This error indicates that the specified settlement type is not permitted for the operation being performed.
  
  Cause:
  
  Invalid Settlement Type: The settlement type specified in the transaction is not valid for the particular function module being executed. This could be due to configuration settings or the nature of the transaction.
  
  Configuration Issues: The settlement type may not be configured correctly in the system. This could involve settings in the controlling area or the specific order type.
  Business Rules: Certain business rules or restrictions may prevent the use of specific settlement types for certain transactions or objects.
  
  
  Solution:
  
  Check Settlement Type: Verify the settlement type being used in the transaction. Ensure that it is appropriate for the context of the operation.
  Review Configuration: