What is allowance in SAP FI-FIO-AR - Fiori UI for Accounts Receivable?

SAP Term: allowance

• Component: FI-FIO-AR

• Component Name: Fiori UI for Accounts Receivable

• Description: A sum of money that is credited to an allowance account. In the context of allowances for doubtful accounts, the purpose of the allowance is to reduce the reported value of the company's financial assets, thereby reflecting the possibility that some overdue receivables may not be collected.

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• Key Concepts: 
  Allowance is a type of discount that is applied to an invoice in SAP. It is used to reduce the amount of money owed by a customer for goods or services. The allowance can be applied to the entire invoice or to individual line items. It can also be used to reduce the amount of taxes due on an invoice. 
  
  How to use it: 
  In SAP, allowances are created in the FI-FIO-AR Fiori UI for Accounts Receivable. To create an allowance, you must first select the customer and invoice that you want to apply the allowance to. Then, you can enter the amount of the allowance and select whether it should be applied to the entire invoice or just certain line items. Once you have entered all of the necessary information, you can save the allowance and it will be applied to the invoice. 
  
  Tips & Tricks: 
  When creating an allowance in SAP, it is important to make sure that all of the information is correct before saving it. This will ensure that the allowance is applied correctly and that no mistakes are made. Additionally, it is important to keep track of all allowances that have been created so that they can be easily referenced in the future if needed. 
  
  Related Information: 
  Allowances are just one type of discount that can be applied in SAP. Other types of discounts include cash discounts, quantity discounts, and promotional discounts. Additionally, there are other types of transactions that can be performed in SAP such as invoicing, payments, and collections.