Letter Of Credit Processing:-

LoC is used to mitigate the Financial risks involved in Global Trade. Configuration:-1. Define Partner Groups relevant to letter of creditPartner group LoC

In this customizing activity, we define partner groups for LoC processing. These Business partner group are required by the determination procedure that the system used to determine the legal regulation for LOC processing.

2. Assign Determination Procedure for Active Legal Regulations

In this step, we specify which determination procedure we want to use to determine the relevant legal regulations for which we have activated LOC. By specifying the determination procedure we use, we define how the system locates the required legal regulations for checking and assigning letters of credit to business partners in Import and export procedures. System used country of departure , Country of destination and partner determination group

3. Activate Legal RegulationsClick on LoC regulation and choose the Country from the dialog structure

Activate LoC for Country of Departure as this process is relevant for ExportChoose Country/Country group option from dialog structure and select the Country IN and activate Export relevant

4. Define procedure for automatic determination of LoC types

Choose LoC1, and click on Determination procedure for LoC type

5. Control settings for LoC processing

Choose display and in the overview screen

Enter Partner Group for Import and Partner group for exportAnd Determination procedure defined previously

Choose Legal regulation defined previously as LoC and click on Allowed status from dialog structure

Create LoC status as above

And assign time Zone

6. Define Letter Credit Types

We have two types of LoCIrrevocable confirmed and Irrevocable UnconfirmedChoose the letter of credit type for your legal regulation and choose display

Enhanced Authorization check: It is used for allow users to change LoC. Click on the allowed status from the dialog structure and check the statuss allowed