How To Fix WS740 - Settlemenmt type &1 is not relevant for contract accounting

SAP Error Message - Details

• Message type: E = Error

• Message class: WS - Supplier Billing Document

• Message number: 740

• Message text: Settlemenmt type &1 is not relevant for contract accounting

Self-Explanatory Message

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• What is the cause and solution for SAP error message WS740 - Settlemenmt type &1 is not relevant for contract accounting ?

  The SAP error message:
  WS740: Settlement type &1 is not relevant for contract accounting
  
  Cause:
  This error occurs when you try to use a settlement type in a process related to Contract Accounts Receivable and Payable (FI-CA), but the settlement type is not configured or assigned as relevant for contract accounting. In other words, the settlement type you are using is not recognized or allowed in the context of contract accounting.
  
  Explanation:
  
  Settlement types in SAP define how amounts are settled or cleared.
  In FI-CA (Contract Accounts Receivable and Payable), only certain settlement types are valid.
  If a settlement type is not marked as relevant for contract accounting, the system will throw this error when you try to use it in FI-CA transactions.
  
  
  Solution:
  
  
  Check Settlement Type Configuration:
  
  Go to transaction code SPRO ? SAP Reference IMG ? Contract Accounts Receivable and Payable ? Basic Functions ? Settlement ? Define Settlement Types.
  Verify if the settlement type you are using is defined here.
  
  
  
  Assign Settlement Type to Contract Accounting:
  
  In the settlement type configuration, ensure that the settlement type is flagged as relevant for contract accounting.
  If it is not, you need to either:
  
  Use a different settlement type that is relevant for contract accounting.
  Or configure the existing settlement type to be relevant for contract accounting (if business process allows).
  
  
  
  
  
  Check Customizing for Settlement Types:
  
  Use transaction SPRO ? Financial Accounting (New) ? Contract Accounts Receivable and Payable ? Basic Functions ? Settlement ? Define Settlement Types.
  Make sure the settlement type is assigned to the correct account type and is active.
  
  
  
  Check the Transaction or Process:
  
  Verify that the settlement type used in the transaction is correct and intended for contract accounting.
  Sometimes, a settlement type from FI-GL (General Ledger) is mistakenly used in FI-CA.
  
  
  
  
  Additional Information:
  
  Settlement types are key in determining how payments, credit memos, and other clearing transactions are processed in FI-CA.
  The error prevents incorrect settlement types from being used, which could cause inconsistencies in contract accounting.
  Always coordinate with your FI-CA functional consultant or SAP FI-CA configuration team when making changes to settlement types.
  
  
  Summary:
  
  
  
  Aspect
  Details
  
  
  
  
  Error
  WS740: Settlement type &1 is not relevant for contract accounting
  
  
  Cause
  Settlement type used is not configured or flagged as relevant for contract accounting.
  
  
  Solution
  Configure or assign the settlement type as relevant for contract accounting in SPRO.
  
  
  Transaction
  SPRO ? Contract Accounts Receivable and Payable ? Basic Functions ? Settlement ? Define Settlement Types
  
  
  
  
  If you need further help, please provide the settlement type code (&1) and the transaction or process where the error occurs.