| # Commission Agreement - Grades (tdcms0635m000) Use this session to view, enter, and maintain commission agreements, which are used to calculate commissions. You can start this session from the Commission Agreements (tdcms0135m000) overview session, by double-clicking a record, or by entering a new comission agreement. You can also start this session stand-alone. To view the details of the commission agreement, click Commission Agreement Details on the File menu of the current session. As a result, the Commission Agreements (tdcms0135m000) details session starts. Agreement Grades The lines on the Agreement Grades tab refer to the Commission Agreements (tdcms0130m000) session, in which you can specify the grades for the agreement. Note LN uses the search priorities of the Commissions/Rebates Parameters (tdcms0100s000) session. The Linking of Relations On field in the Commissions/Rebates Parameters (tdcms0100s000) session determines whether relations must be linked to the complete order, or to individual order lines. An agreement group, which is linked to the relation, is used for linking relations on order level. A commission/rebate group, which is linked to the item, is used for linking relations on order line level. If you change the Linking of Relations On parameter after you defined commission agreements, LN might not find valid agreements. As a result, you must correct the agreements. To avoid this, do not change the parameter after agreements are defined. If you change agreements, the changes take effect immediately on all subsequent calculations of commissions and rebates. Therefore, it is advisable to calculate the commissions and rebates for all outstanding orders before you change an agreement. Use the Print Commission/Rebate Agreements (tdcms0430m000) session to print agreement information. Related topics Overview of commissions and rebates Sold-to Business Partner Usually a customer's purchase department, the business partner who orders goods or services from your organization, that owns the configurations you maintain, or for whom you perform a project. The agreement with the sold-to business partner can include the following: Default price and discount agreements Sales order defaults Delivery terms The related ship-to and invoice-to business partner Relation A shortened term for trade relation. Relation is a collective term for an employee or buy-from business partner that is entitled to a commission, and a sold-to business partner entitled to a rebate. Relations can be grouped in a relation team for the purpose of assigning the same agreement structure. Relation Type A classification that determines whether a commission or a rebate is involved, as well as how commissions are to be paid. The relation is a sold-to business partner to whom a rebate is granted, or a buy-from business partner (agent) or an employee (representative) to whom commission is paid. Child Agreement If this check box is selected, the agreement is a child agreement. You can only access this field if the Relation field is filled and if the Parent Commission for Child check box in the Commissions/Rebates Parameters (tdcms0100s000) session is selected. Agreement Group A group of relations to which the same commission/rebate agreements are linked. Project An endeavour with a special objective to be met within the prescribed time and money limitations and that has been assigned for definition or execution. Item In LN, the raw materials, subassemblies, finished products, and tools that can be purchased, stored, manufactured, sold, and so on. An item can also represent a set of items handled as one kit, or exist in multiple product variants. You can also define nonphysical items, which are not held in inventory but can be used to post costs or to invoice services to customers. The following are examples of nonphysical items: Cost items (for example, electricity) Service items Subcontracting services List items (menus/options) Related topics customized item Commission Group A set of items that is grouped and then linked to an agreement. Effective Date The date from which the agreement is valid and effective. Expiry Date The date from which the agreement is no longer valid and effective. Cumulative Agreement If this check box is selected, this is an agreement to calculate commissions based on cumulative sales. LN records all sales for which this agreement is applicable in a separate file. At the end of the current period, you can calculate the commission based on the total sales in this period with the Calculate Commissions/Rebates on Cumulative Sales (tdcms1200m000) session. Grade by Quantity/Amount This field determines the basis for the grades. Currency A generally accepted medium of exchange such as coins, treasury notes, and banknotes. The following currency types are available in LN: Home currency, which is used internally by companies to calculate costs, record budgets, and register tax amounts Transaction currency, which is used in transactions with business partners, such as orders and invoices Note If the Currency for Invoicing is set to Agreement in the Relations (tdcms0110s000) session, you can use this field to specify the invoice currency for a relation. However, if the agreement applies to an agreement group, you cannot define an invoice currency. In this case, the reference currency is used. Grade Unit The unit that is used to determine the grade. A grade unit only applies to agreements defined for items. Note You must first fill in the Item field and then choose Quantity in the Grade by Quantity/Amount field, so you can fill in the grade unit. Grade Calculation This field determines the basis for the grade calculation. Example If an item is ordered:
Quantity | Unit Price | Commission
100 | 20 | 1 %
    Result:

    Gross
    The commission is 100 * 20 * 1% = 20
    Net
    The commission is 100 * 20 * 1% = 20
    The remainder amount is 2000 - 20 = 1980
    The final commission amount is 1% *	1980 = 19.80
Related topics Commissions and rebates calculation examples Fixed Amount On This field determines how the commissions are calculated, if a fixed amount is entered. Allowed values Fixed Amount on grade or Unit Commission Over The basis on which commissions are calculated. Grade The commission is based on the amount or quantity in this grade. Total The commission is based on the total amount of an order, or order line. Example An order is placed for $25,000, using the following scale:
Up to | %
--- | ---
$10,000 | 0
$20,000 | 1
$30,000 | 2
$999,999 | 3
If the percentage is based on Grade, the following applies: $10,000 * 0% = $0 $10,000 * 1% = $100 $5,000 * 2% = $100 Total = $200 If the percentage is based on Total, the commission is calculated as follows: $25,000 * 2% = $500 Grow Commission Over The basis on which the growing commissions are calculated. Example A sales order is placed for $50,000. The normal commission is based on Total. The growing commission is based on Grade. The following scale is used:
Up to | Normal % | Growing %
--- | --- | ---
$10,000 | 0 | 0
$20,000 | 1 | 0
$30,000 | 2 | 1
$999,999 | 3 | 3
Commission | Calculation
--- | ---
Normal | $50,000 * 3% = $1,500
Growing | $10,000 * 0% = $0 $10,000 * 0% = $0 $10,000 * 1% = $100 $20,000 * 3% = $600 Total = $700
Total | = $1,500 + $700 = $2,200
Invoice Direct/Reserve This field controls how LN settles the calculated commission. The following restrictions apply to this function: If an Employee relation type is specified in the agreement, this field is always Reserve. If the Link with Finance check box is selected in the Commissions/Rebates Parameters (tdcms0100s000) session and no Employee relation type is specified in the agreement, this field is Invoice. Note Payments to employees are not invoiced directly, because of legal requirements concerning taxation. When no relation is entered in the agreement, LN checks the relation type when commissions are posted to Financials. If the relation is Employee, the calculated commission is always accumulated, even if this field is Invoice. Allowed values Invoice directly/reserve Discount Code The discount code's type must correspond with the agreement's type ( Commission or Rebate), and must be suitable for use in an agreement. |