How to Configure Credit Orders in iDempiere

The Credit Order is a document type on the iDempiere Sales Order window built for customers who buy on approved credit. It ships and invoices the order in one step instead of two separate transactions.

It shortens the order-to-cash cycle, keeps stock and invoicing in sync, and drives collections through the customer’s payment schedule.

Process Flow

Business Rules

• Credit Order requires the Business Partner to have an approved credit limit and payment terms.
• Payment Rule and Payment Terms default from the Business Partner record automatically.
• Order cannot complete if the customer exceeds their assigned credit limit.
• Completing the order auto-generates and completes a matching Shipment document.
• Completing the order auto-generates and completes a matching AR Invoice.
• Stock is not reserved in advance; it is shipped immediately on completion.
• The invoice inherits the payment schedule generated from the order’s payment terms.
• Tax is calculated on the invoice line using the tax category linked to the product.

Prerequisites

• Business Partner configured with Credit Limit and Payment Terms.
• Business Partner Location (ship-to / bill-to address) configured.
• Sales Price List configured with product prices (e.g. Promotional Sales Price List).
• Warehouse and Locator configured for the shipping organization.
• Document Type “Credit Order” active for the Sales Order window.
• Tax Category and Tax Rate configured for the products sold.
• Sales Representative (User) set up for order attribution.

Configuration Steps

Step 1: Configure the Business Partner Credit Profile

Open Business Partner, set the Credit Limit and Payment Terms, and confirm an active Business Partner Location exists for shipping and billing.

Field	Sample Value	Description
Business Partner	FIVE TECHNOLOGIES PRIVATE LIMITED	Customer buying on credit
Partner Location	Chennai Office	Ship-to / bill-to address
User/Contact	Harish Kumar	Customer contact for the order

Step 2: Create the Sales Order with Credit Order Document Type

• Create a new Sales Order, select the Business Partner, and set Target Document Type to Credit Order.
• Payment Rule and Payment Terms populate automatically from the customer.

Field	Sample Value	Description
Target Document Type	Credit Order	Drives auto ship and invoice on completion
Warehouse	CDC Godown	Source warehouse for the shipment
Delivery Via	Pickup	How goods reach the customer
Price List	Promotional Sales Price List	Price source for order lines
Currency	INR	Transaction currency
Sales Representative	Aravind Kumar	Order owner for reporting

Step 3: Enter Order Lines

• Add the product, quantity, and confirm Unit Price and Tax.
• List Price shows the price list reference; Unit Price is what the customer is actually charged.

Field	Sample Value	Description
Product	1000000_Men’s shoe	Item being sold
Quantity	1	Units ordered
UOM	Each	Unit of measure
List Price	100.00	Reference price from price list
Unit Price	200.00	Actual selling price per unit
Tax	CGST 1.5%	Tax rate applied to the line
Line Amount	200.00	Quantity × Unit Price

Step 4: Complete the Order

Click Complete on the order. The system checks the credit limit, builds the payment schedule, then auto-creates and completes the Shipment and the AR Invoice.

Field	Sample Value	Description
Document Status	Completed	Confirms the order processed successfully
Document No	60001	System-generated order number
Grand Total	200.00	Total order value including tax

Step 5: Review the Auto-Generated Shipment

Open the linked Shipment from the order. Confirm the Locator, Movement Quantity, and Document Type match the sale before closing the transaction.

Field	Sample Value	Description
Document Type	MM Shipment Indirect	Delivery document type
Warehouse	CDC Godown	Warehouse stock is shipped from
Locator	Godown Locator	Storage bin the stock is picked from
Movement Quantity	1	Quantity physically shipped
Sales Order Line	60001_07/01/2026_10_200	Link back to the originating order line

Step 6: Review the Auto-Generated Invoice

Open the linked Invoice, confirm Payment Rule, Grand Total, and Document Status show Completed, then verify the Paid flag once payment terms are settled.

Field	Sample Value	Description
Document Type	AR Invoice	Customer-facing billing document
Order	60001_07/01/2026	Source order reference
Payment Rule	Cash	How the customer settles this invoice
Document Status	Completed	Confirms invoice posted successfully
Grand Total	200.00	Amount billed to the customer
Paid	Checked	Indicates payment has been received

Common Issues and Resolutions

Issue	Cause	Resolution
Payment Rule blank on order	Business Partner has no default Payment Rule set	Set Payment Rule and Payment Terms on the Business Partner record
Shipment not created automatically	Target Document Type left as Standard Order	Set Target Document Type to Credit Order before completing
Wrong selling price on line	Incorrect Price List selected on order header	Select the correct Price List before adding order lines
Invoice not linked to shipment	Order completed before shipment confirmation processed	Re-check the Shipment/Receipt Line reference on the invoice line
Discount % shows unexpected negative value	Unit Price entered above the Price List value	Confirm Unit Price against the intended Price List entry

Next Steps

• Configure Payment Terms window for staged due dates.
• Set up Dunning rules for overdue Credit Order invoices.
• Review Price List Version for seasonal or promotional pricing.
• Configure Warehouse and Locator for additional retail outlets.