At goods receipt, a provision is posted to the freight or customs clearing account. These account keys are assigned to the specific condition types in the MM Pricing schema. If the freight vendor is different from the material vendor: then for crediting only the delivery costs, we can choose the option: Planned delivery costs. Unplanned delivery costs: are the costs which are not specified in the Purchase order and are only entered when you enter the invoice.
What is the basis on which the apportionment is done of unplanned delivery costs? For a material subjected to Moving average price, the unplanned delivery costs are posted to the stock account, provided sufficient stock coverage exists.
For a material subjected to Standard price, the unplanned delivery costs are posted to the Price difference account. There are cases where Invoice verification is done first before the Goods receipt is made for the purchase order. In these cases with what values would the Goods receipt be posted? Since the invoice verification has been done first the Goods Receipts will be valued with the Invoice value. Recurring Documents. Posting Accruals or Provisions entries at month end 3.
Maintain Exchange Rates 6. Reclassify Payables and Receivables if necessary 8. Run the Depreciation Calculation 9. Fiscal Year Change of Asset Accounting if it is year end Run the Bank Reconciliation Company codes are assigned to the controlling area. A controlling area is assigned to the operating concern. Controlling Area is the umbrella under which all controlling activities of Cost Center Accounting, Product costing, Profitability Analysis and Profit Center are stored.
Operating Concern is the highest node in Profitability Analysis What is primary Cost element and secondary cost element? Primary Cost Elements are those which are created from FI general Ledger Accounts and impact the financial accounts eg. Travelling expenses, consumption account infact, any Profit and Loss GL account Secondary Cost Elements are those which are created only in controlling and does not affect the financials of the company.
It is used for internal reporting only. The postings to these accounts do not affect the Profit or Loss of the company. The following categories exist for secondary cost elements: 21 Internal Settlement: Cost elements of this category is used to settle order costs to objects in controlling such as cost centers, pa segments etc. Assessment Used to calculate costs during assessment 43 Internal Activity Allocation Used to allocate costs during internal activity allocation such as Machine Labour etc What are cost objects?
A cost object means a cost or a revenue collector wherein all the costs or revenues are collected for a particular cost object. Examples of this could be cost center, production order, internal order, projects, sales order So whenever you look at any controlling function the basic thing you need to ask yourself is What is the cost element expense I want to control and what is the cost object i.
Sounds confusing read it again it is very simple Controlling is all about knowing the cost element and the cost object. Every time pose this question to yourself what is the cost element what is the cost object. At the end of the period all costs or revenues in the cost object are settled to their respective receivers which could be a gl account, a cost center, profitability analysis or asset. It is very important that you understand this otherwise you would struggle to understand Controlling.
Cost Center Accounting: How is cost center accounting related to profit center? In the master data of the Cost Center there is a provision to enter the profit center. This way all costs which flow to the cost center are also captured in the profit center. Cost centers are basically created to capture costs e. What is a cost element group? Cost element group is nothing but a group of cost elements which help one to track and control cost more effectively.
You can make as many number of cost element groups as you feel necessary by combining various logical cost elements. What is a cost center group? In a similar line the cost center group is also a group of cost centers which help one to track and control the cost of a department more effectively. You can make as many number of cost centers as you feel necessary by combining various logical cost centers Infact you can use various combinations of cost center group with the cost element group to track and control your costs per department or across departments What is the difference between Distribution and Assessment?
Distribution uses the original cost element for allocating cost to the sender cost center. Thus on the receiving cost center we can see the original cost element from the sender cost center. Distribution only allocates primary cost. Assessment uses assessment cost element No 43 defined above to allocate cost. In receiver cost center the original cost breakup from sender is not available. Assessment allocates both primary as well as secondary cost.
What are the other activities in Cost center? What is an Activity Type? Activity types classify the activities produced in the cost centers. Examples of Activity Type could be Machine, Labour, Utilities You want to calculate the activity price through system? What are the requirements for that? In the activity type master you need to select price indicator 1 — Plan price, automatically based on activity.
When activity price is calculated through system whether activity price is shown as fixed or variable? Normally when activity price is calculated through system it is shown as fixed activity price since primary cost are planned as activity independent costs.
What is required to be done if activity price is to be shown both fixed and variable? In this case you need to plan both activity independent cost which are shown as fixed costs and activity dependent costs which are shown as variable costs.
Is it possible to calculate the planned activity output through system? It is possible to calculate the planned activity output through system by using Long term Planning process in PP module. Explain the process of calculating the planned activity output through Long term planning? In Long term planning process the planned production quantities are entered for the planning year in a particular scenario.
The Long term planning is executed for the scenario. This generates the planned activity requirements taking the activity quantities from the routing and multiplying with the planned production. The activity requirements are then transferred to the controlling module as scheduled activity quantities. Thereafter you execute a plan activity reconciliation which will reconcile the schedule activity and the activity you have planned manually.
The reconciliation program updates the scheduled activity quantity as the planned activity in the controlling module. You want to revalue the production orders using actual activity prices. Is there any configuration setting? There is a configuration setting to be done. Where is the configuration setting to be done for carrying out revaluation of planned activity prices in various cost objects?
The configuration setting is to be done in the cost center accounting version maintenance for fiscal year. This has to be maintained for version 0. You need to select revalue option either using own business transaction or original business transaction.
At month end you calculate actual activity prices in the system. You want to revalue the production orders with this actual activity prices. What are the options available in the system for revaluation? The options available are as follows:- You can revalue the transactions using periodic price, average price or cumulative price. Further you can revalue the various cost objects as follows:- Own business transaction — Differential entries are posted Original business transaction — The original business transaction is changed.
Internal orders What is the purpose of defining Internal orders.? An example would help us understand this much better. Lets say in an organization there are various events such as trade fairs, training seminars, which occur during the year. Now lets assume for a second that these Trade fairs are organized by the Marketing cost center of the organization. Therefore in this case marketing cost center is responsible for all the trade fairs costs.
All these trade fairs costs are posted to the marketing cost centers. Now if the management wants an analysis of the cost incurred for each of the trade fair organized by the marketing cost center how would the marketing manager get this piece of information across to them? The cost center report would not give this piece of info Now this is where Internal Order steps in. If you go through all cost center reports this information is not readily available since all the costs are posted to the cost center.
SAP, therefore provides the facility of using internal orders which comes in real handy in such situations. In the above scenario the controlling department would then need to create an internal order for each of the trade fair organized. The cost incurred for each of the trade fair will be posted to the internal orders during the month. At the month end, these costs which are collected in the internal order will be settled from these orders to the marketing cost center.
Thus the controlling person is now in a position to analyze the cost for each of the trade fair separately. Thus internal order is used to monitor costs for short term events, activities. It helps in providing more information than that is provided on the cost centers.
It can be widely used for various purposes. How can you default certain items while creation of internal order master data? You can do so by creating a model order and then update the fields which you want to default in this model order. Finally attach this model order in the internal order type in the field reference order. Once the above is done whenever you create an internal order for this order type the field entries will get copied from the model order.
What is the configuration setting for the release of the internal order immediately after creation? To come up with this standard price for the finished good material this material has to be costed. This is done using Costing Variant. Further questions down below will explain this concept better.
What are the configuration settings maintained in the costing variant? Costing variant forms the link between the application and Customizing, since all cost estimates are carried out and saved with reference to a costing variant. The costing variant contains all the control parameters for costing. The configuration parameters are maintained for costing type, valuation variants, date control, and quantity structure control.
In costing type we specify which field in the material master should be updated. In valuation variant we specify the following a the sequence or order the system should go about accessing prices for the material master planned price, standard price, moving average price etc.
SAP first costs the lowest level product, arrives at the cost and then goes and cost the next highest level and finally arrives at the cost of the final product. What does the concept of cost roll up mean in product costing context? The purpose of the cost roll up is to include the cost of goods manufactured of all materials in a multilevel production structure at the topmost level of the BOM Bill of Material The costs are rolled up automatically using the costing levels.
The costs for the materials costed first are rolled up and become part of the material costs of the next highest level. What is a settlement profile and why is it needed? All the costs or revenues which are collected in the Production order or Sales order for example have to be settled to a receiver at the end of the period. This receiver could be a Gl account, a cost center, profitability analysis or asset. In order to settle the costs of the production order or sales order a settlement profile is needed.
In a settlement profile you define a range of control parameters for settlement. You must define the settlement profile before you can enter a settlement rule for a sender. Settlement profile includes:- 1 the retention period for the settlement documents. A1 The settlement profile created is then attached to the order type. What is Transfer or Allocation structure? The transfer structure is what helps in settling the cost from one cost object to the receiver.
It is maintained in the Settlement profile defined above. The Transfer structure has 2 parts: a Source of cost elements you want to settle b Target receiver whether it is a Profitability segment or fixed asset or cost center So basically for settling the costs of a cost object you need to define the Transfer structure where you mention what are the costs you want to settle and the target receiver for that.
This information you fit it in the settlement profile which contains various other parameters and this settlement profile is defaulted in the Order type. Primary cost split is defined when you create a cost component structure. When you switch on this setting, the primary cost from the cost center are picked up and assigned to the various cost components.
How do primary costs get picked up from cost center into the cost component structure? This is possible when you do a plan activity price calculation from SAP. The primary cost component structure is assigned to the plan version 0 in Controlling.
Is it possible to configure 2 cost component structures for the same product in order to have 2 different views? We create another cost component structure and assign it to the main cost component structure. This cost component structure is called Auxiliary cost component structure which provides another view of the cost component structure.
How do you go about configuring for the sales order costing? In the requirement class we attach the costing variant, we attach the condition type EK02 where we want the sales order cost to be updated, and the account assignment category. In the account assignment category we define whether the sales order will carry cost or not.
In case if we do not want to carry cost on the sales order we keep the consumption posting field blank. We also define here the Results Analysis version which helps to calculate the Results Analysis for the Sales order if required. There are 2 plants in a company code.
First plant is the manufacturing plant and another plant is the selling plant. Finished goods are manufactured at the manufacturing plant and transferred to the selling plant. How is standard cost estimate calculated at the selling plant given the fact that the cost at both the plant should be the same? The special procurement type needs to be configured which specifies in which plant the system is to look up for cost.
Here a special procurement key specifying plant 1 manufacturing plant should be configured. This special procurement type must be entered in the costing view or the MRP view of the Finished good material master record in plant 2. When you cost the finished good at plant 2, the system will transfer the standard cost estimate from plant 1 to plant 2 What is mixed costing in SAP? Give an example to explain.
Mixed costing is required when different processes are used to manufacture the same material. Mixed costing is required when you have different sources of supply for purchasing the material. Let us take an example:- There is a finished good Xylene which can be manufactured by 3 different processes.
The first process uses an old machine and labour. The processing time is 9 hrs to manufacture. The second process uses a semi-automatic machine and labour. The processing time is 7 hrs to manufacture. The third process uses a fully automatic machine and the processing time is 5 hrs.
Thus cost of manufacture for the 3 processes is different. By using Mixed costing you can create a mixed price for the valuation of this finished good. What configuration needs to done for using Mixed costing? Quantity Structure type for mixed costing must be configured. Here we specify the time dependency of the structure type.
The following options exist a You have no time dependency. Lets say for a product there exists three production versions. Explain the process how you would go about creating a mixed cost estimate? The process of creating a Mixed cost estimate would be as follows:- 1 Create procurement alternatives for each of the production version. What is Mixing ratios and why are they required to be maintained before creation of cost estimate? Mixing ratios are weighting factors assigned to the procurement alternatives.
This weighting factor is obtained from the planning department based on the usage of the procurement alternatives during the planning year. Thus when system calculates the mixed cost estimate, system will first cost each of the production version and then multiply each of the costs with the weighting factors.
Thus cost of prod. What do you mean by the result analysis category Reserves for unrealized costs? If you are calculating the work in process at actual costs, the system will create reserves for unrealized costs if the credit for the production order based on goods receipts is greater than the debit of the order with actual costs incurred.
Normally this is not maintained in most of the companies. By-product reduces the cost of the main product. There is no Bill of Material for a By-product. How do you calculate the cost for a By-product in SAP? The cost for the By-product is the net realizable value. This is manually maintained in the system for the by-product through transaction code MR21 Price change.
A Co-product primary product or by-product is indicated by a tick in the costing view of the material master. In the BOM all the primary products are represented as an item with negative quantity. A primary product is also indicated as a co-product in the BOM of the leading co- product. For primary products the costs are calculated using the apportionment method, while for by-products the net realizable value method applies.
It is not possible to use the Standard Co-product functionality in repetitive manufacturing How do you got about defining CO-Product functionality in Repetitive manufacturing? Through arithmetical calculation you need to maintain the quantities in the costing BOM. This co-product will be shown as a negative item in the leading co-product. What could be the possible cause of error in this scenario? The consumption GL code for the material master is not assigned to the cost component structure.
To find out how you can know which GL code to assign read the next question. In the above scenario how do you know which cost element is being called for? In this case you need to the use simulation mode OMWB in MM and enter the material code plant and the movement type issue against production order. In this case everything is perfectly configured, what could be the possible error in this scenario? In the material master of the raw material the valuation class updated in the accounting view will be incorrect.
Is it possible to calculate standard cost estimate for a past date? It is not possible to calculate standard cost estimate for a past date. What is the difference between a product cost collector and production order? Both of these are cost objects which collect production costs for manufactured product.
Product cost collector is a single order created for a material. All the costs during the month for that material is debited to single product cost collector. No costing by lot size is required in case of product cost collector.
The latter is where there are many production orders for a single material during the month. Costs are collected on each of this production order. Costing by lot size is the main requirement in case of production orders. What is the meaning of preliminary cost estimate for product cost collector? Preliminary costing in the product cost by period component calculates the costs for the product cost collector.
In repetitive manufacturing you can create cost estimate for specific production version. Why is preliminary cost estimate required? The preliminary cost estimate is required for the following:- Confirm the actual activity quantities. Valuate work in process Calculate production variances in variance calculation Valuate the unplanned scrap in variance calculation Is it possible to update the results of the standard cost estimate to other fields such as commercial price, tax price fields in the accounting view?
It is possible to update the standard cost estimate to other fields such as commercial price etc. How do you configure that the results of the standard cost estimate are updated in other fields other than the standard price? The price update in the material master is defined in Costing type. This costing type is attached to the costing variant.
What do you mean by Assembly scrap and how is it maintained in SAP? Assembly scrap is scrap that is expected to occur during the production of a material which is used as an assembly. If a certain amount of scrap always occurs during the production of an assembly, the quantities and activities used must be increased by the system so that the required lot size can be produced.
To increase the lot size of an assembly you can enter a percentage, flat- rate assembly scrap in the MRP 1 view of the material master record. This assembly scrap is reflected in all the subordinate components. The system increases the quantity to be produced by the calculated scrap quantity.
This increases both the materials consumed and the activities consumed and consequently the cost. How are scrap costs shows in the standard cost estimate? Scrap costs are assigned to the relevant cost component and can be shown separately for a material in the costed multilevel BOM.
How are scrap variances calculated? Scrap variance are calculated by valuating the scrap quantities with the amount of the actual costs less the planned scrap costs. What do you mean by Component scrap and how is it maintained in SAP? Component scrap is the scrap of a material that is expected to occur during production. When an assembly is produced with this component, the system has to increase the component quantity to enable to reach the required lot size.
Operation scrap is a scrap that is expected to occur during production. Operation scrap is used to reduce the planned input quantities in follow up operations and to calculate the precise amount of assembly scrap. What are the implications if the operation scrap is maintained in the routing and if it maintained in the BOM?
If the operation scrap is maintained only in the routing, the costing lot size is reduced by this percentage. If the operation scrap is maintained in the BOM, the planned input not the output quantity is increased and any assembly scrap is reduced. What is the meaning of additive costs in SAP and why is it required? Additive costs are used to add costs manually to a material cost estimate when it cannot be calculated by the system.
Examples of such costs are freight charges, insurance costs and stock transfer costs. What is the configuration required for additive costs? Further you also need to set in the costing variant to include additive costs. How do you configure split valuation? The configuration steps involved in split valuation:- 1 Activate split valuation — Configure whether split valuation is allowed for the company code.
What is valuation category and valuation type in split valuation? In split valuation the material stock is divided according to valuation category and valuation type. Valuation category determines how the partial stocks are divided according to which criteria. What are the steps involved before you run a cost estimate for a split valuated material? The following are the steps:- 1 Create procurement alternatives based on the valuation types for the material.
To create a split valuated material master proceed as follows:- 1. First create a valuation header record for the material. Update the Valuation category field on the accounting screen; leave the Valuation type field blank. In the Price control field, enter V moving average price. When you save, the system creates the valuation header record. Then create the material for a valuation type. Call up the same material in creation mode again. Due to the fact that a valuation header record exists, the system requires you to enter a valuation type for the valuation category.
Repeat Step two for every valuation type planned. When a standard cost estimate is run for a finished good does SAP calculate cost estimate for its components such as raw and packing material? How is it possible to apply 2 different overhead rates for 2 different finished goods? It is possible through overhead groups. You configure 2 overhead keys. Define rates for each of this overhead key. These two overhead keys is then assigned to the two overhead groups. These overhead groups are attached in the costing view of the finished goods material master.
How will system calculate WIP for period 2? What is the basic difference in WIP calculation in product cost by order and product cost by period repetitive manufacturing? You define secondary cost elements of type 31 first.
In the end you define the Finance GL accounts which are debited and credited when a Work in Progress is calculated. The system first runs through all the production order for the month and checks for the status of each production order. There is a production order with order quantity kgs. During the month kgs of goods were produced. What will be the system treatment at the month end? The system will first check the status of the production order.
Why does the system not calculate variance for the kgs which has been delivered? In the product cost by order component the system does not calculate a variance for partially delivered stock on the production order. Whatever is the balance on the production order is considered as WIP. In the product cost by period component, system will calculate WIP as well as variance provided Is the WIP calculated in the product cost by order component at actual costs or standard costs?
In the product cost by order component the WIP is calculated at actual costs. Is the WIP calculated in the product cost by period component at actual costs or target costs? In the product cost by period component the WIP is calculated at target costs. Material Ledger What precautions have to be taken while switching on the material ledger for a plant?
A material ledger once activated for a plant cannot be switched off. Therefore it is important that the material ledger be activated carefully for a plant. How do you go about configuring material ledger? When a material ledger is activated it is imperative that actual costing run has to be done every month. Actual costing run needs to be done immediately after the new month roll over. After the actual costing run you cannot post any MM Materials Management entry to the previous period.
What are the options available while performing revaluation in an actual costing run? There are 2 options available:- Revaluation — You can revalue the finished goods stock Accrual — You can accrue the revaluation gain or loss without actually changing the price in the material master. What is the configuration setting to be done for posting the accrual in the actual costing run? What are the steps to be taken before you execute an actual costing run?
The following are the steps to be taken: 1. Execute all the allocation cycles in the cost center accounting module. Execute actual activity price calculation. Revalue all the production orders with the actual activity prices. The under or over absorbed cost on cost centers are passed on to the production order through this step of revaluation of production orders.
Calculate overheads, do a variance calculation and finally settle the production order. Finally execute the actual costing run. What happens in an actual costing run? In actual costing run there is a process of single level price determination and multi level price determination. The production price difference variances are collected on the material ledger for each of the finished goods and semi finished goods. During single level price determination the price difference collected on a single finished product is allocated to consumption.
This allocation to the consumption is not individually allocated to the good issues. In multi level price determination the price difference is allocated to individual goods issue. The price differences are passed on to the next level of consumption. The system calculates a weighted average price for the finished goods and semi finished goods. This weighted average price is called as the periodic unit price What happens when the revaluation is done in actual costing run for the previous period?
When revaluation is performed in actual costing for the previous period the price control in the material master is changed from S to V and the periodic price is updated as the valuation price for the previous period. What is the importance of the price determination indicator in the material master for the purpose of actual costing run? There are 2 price determination indicators in the material master when material ledger is activated. In case of material masters having price determination indicator 3 actual costing will take place.
What should be the price control for a material master which has a price determination indicator 3 where material ledger is activated? In such a case only price control S is possible where the price determination 3 is activated in material master. Profitability Analysis Explain the organizational assignment in the PA module? The operating Concern is the highest node in Profitability Analysis.
The operating concern is assigned to the Controlling Area. Within the operating concern all the transactions of Profitability Analysis are stored. The operating concern is nothing but a nomenclature for defining the highest node in PA. What is the functionality of the PA module? PA module is the most important module when it comes to analyzing the results of the organization.
In this module you basically collect the revenues from the sale order , the costs from the production order, cost center or internal order and analyze their results. The interesting part about this module is that when it collects the costs and revenues it also collects the characteristics associated with the costs and revenues and this is what makes it stand out So for e. To do so while defining Operating concern one has to define Characteristics and Value fields. What are characteristics and Value Fields?
In the operating concern two things are basically defined a Characteristics b Value Fields Characteristics are nothing but those aspects on which we want to break down the profit logically such as customer, region product, product hierarchy, sales person etc Value Fields are nothing but the values associated with these characteristics Eg Sales, Raw Material Cost, Labour Cost, Overheads etc Once you define the characteristics and value fields these values are updated in the table.
From where does the characteristics come from? The characteristics which are defined above basically comes from either the Customer Master or the Material Master. How does various values revenues and costs flow into PA? We need to map the Condition Type in SD to the respective value fields in customizing to have the revenue flow into PA. The Cost comes from Cost estimates which are transferred using the PA transfer structure which we have covered in the Product costing section.
The various cost components of the cost component structure is assigned to the value field of PA module and this is how the costs come into PA. Once the actual revenue and the std cost defined above are captured in PA the variances are also transferred into PA. This way the std cost variances equal the actual cost. So actual revenue- actual cost helps us determine the profit.
How do you configure the assignment of variances from product costing to COPA module? The variance categories from product costing along with cost element is to be assigned to the value fields in COPA Once you have captured all the costs and revenues how do you analyze them? The costs and revenues which we have captured in the above manner are then analysed by writing reports using the Report Painter Functionality in SAP.
What is characteristic Derivation in Profitability Analysis Module? Characteristic Derivation is usually used when you want to derive the characteristics. An example of this could be say you want to derive the first two characteristics of product hierarchy. In such cases you define characteristic derivation where you maintain the rules, which contain the table names of the product hierarchy fields and the number of characters to be extracted, and it also specifies the target characteristic field in PA.
What is the basic difference in customizing in Profitability analysis as compared to other modules? In PA when we configure the system i. The configuration needs to be transported through a different transaction called as KE3I. Account based Profitability analysis is a form of Profitability analysis PA that uses accounts as its base and has an account based approach.
It uses costs and revenue elements. Costing based Profitability Analysis is a form of profitability analysis that groups costs and revenues according to value fields and costing based valuation approaches. The cost and revenues are shown in value fields. The advantage of Account based PA is that it is permanently reconciled with Financial accounting.
The disadvantages are that it is not powerful as the costing based PA, since it uses accounts to get values. No Contribution margin planning can be done since it cannot access the standard cost estimate. Further no variance analysis is readily available. The advantages of the Costing based PA are manifold. Disadvantages:- Since it uses a costing based approach, it does not sometime reconcile with financial accounting. Can both Account based and Costing based Profitability analysis be configured at the same time?
It is possible to configure both types of costing based profitability analysis at the same time. What is the advantage of configuring both the type of Profitability analysis together? The advantage of activating account based profitability analysis along with costing based PA is that you can easily reconcile costing based profitability analysis to account based profitability analysis, which means indirectly reconciling with Financial accounting.
Is there any additional configuration required for Account based profitability analysis as compared to costing based profitability analysis? There are no special configurations required except for activating the account based profitability analysis while maintaining the operating concern. Process Reference. One-Time Entry. Reversing Entry. Accrual Entry. FBS1 and F. Recurring Entry. FBD1 or F.
This section gives detail to the first step of the workflow process which is creating a journal voucher document up to submitting the document to be reviewed and approved through the workflow. For illustration purpose, below are step by step instructions to reclassify an expense from one GL account i.
Enter FV50 in the Command field. Enter data in the following fields in the Header section:. Header Text : entry description. Enter data for each GL entry in the corresponding column fields. There are a total of 13 fields that can be populated in the line field of GL Document screen, depending on the type of line item being entered. The following fields are mandatory:. Click the Enter icon to validate the data added. The status of the GL document will change based on the outcome of the simulation.
Review the entry for accuracy; update any data that has been identified as incorrect. Click the Simulate button; the document view shows the entry as it was entered. Click on Document in the navigation bar and select Simulate in General Ledger option. The entry appears as it will post in the General Ledger.
In Umoja, this type of document is created to cater all adjustment entries. Click the Save as completed button. A document number will be created and the document will be routed to Approving Officer through Workflow. The following is a proforma accounting entry:. GL Acct. GL Acct Name. Document Currency.
Bus Area. Cost Center. OE Infra AlteratPrem. OE Infra ElectriServ. A reversing entry can be performed in Umoja if a journal voucher JV was posted erroneously. The following steps are to be followed to reverse a posted GL entry in Umoja. A separate reversal document is created. Enter data in the following fields:.
This will only work only if the original posting period is open. Click the Display before reversal button to see and confirm original document that is about to be reversed. Click the Save button to post the reversal document. Note the document number generated by the system. It does not go through a workflow. IPSAS requires that all expenses are to be accounted for in the year they are incurred.
Accruals serve as a solution as they allow expenses to be posted in the year they are incurred and then reversed once the charges are received in the following period. The UN records accrual of expenses at year end in order to match costs against revenue in the same financial period.
The accruals are recorded when the expenses have been incurred but invoices have yet to be received from the vendors at year end. Note: This process does not apply to expenses processed through a Purchase Order PO which includes processing Service Entry Sheet for services already rendered. When there is a PO, an expense is recognised when goods or a service has been delivered. In recognizing the delivery of goods or services, the system will generate a credit to Account Payable - Goods Receipt GL account.
In Umoja, this type of document is created to cater all accrual entries. Header section:. Note : The SZ document type allows Users to charge expenses in the accrual document without consuming budget. Header Text : brief description of the accrued expenses. Inverse Posting section:. Line Item section:. Press Enter key. Click on button. In the pop up window, input:. Click Enter to get back to the previous screen.
In Next Line Item section, enter the credit line. Click the Enter icon. Click the Overview button to display the debit and credit line items. Once all entries have been entered, click the Save button to post the document. Note the FI document number generated by the system. Following is a proforma accounting entry that will be created:.
AP Accrued Expense Man. Reversal of accrual documents is run centrally through a batch program on the posting date indicated on the Inverse Posting section entered in FBS1 of the individual accrual document.
Only authorized User can run the program and unauthorized users are not supposed to process reversals manually. Enter F. Ensure that the Test Run box in on before clicking on the Execute button. Review the log generated. Click the Back icon to exit. Review the log and noted the document numbers generated for the renewals.
In the opening screen, enter the accrual document number that posted in error in the Document Number field and press Enter. In the open scree, locate the Reversal date field and delete the date. Save the changes. Use T-code FB08 to reverse the amended accrual document. Recurring entry can be used where identical entries are required to be posted on a periodic basis or on specific future dates e.
In addition, users will be able to create and save journal entry templates that can used repeatedly to accelerate the processing time and reduce the number of input errors. Create: First, the entry itself must be created and saved. The saved template will be used to post the information on a recurrent basis without the need to manually re-enter the data into Umoja. Post: Once the template has been created and saved, the posting will be executed as a normal part of period end closing for all recurring entries created in the system.
For illustration purpose, below are step by step instructions to set up a recurring entry debiting GL and crediting GL In the Recurring entry run section, enter data into the following fields:. In the Document header information and First line item sections, enter data into the following fields:. Document header information section:.
First line item section:. In the Item 1 section, enter data in the following fields:. Hit Enter to go back to previous screen. In the Next Line Item section, enter:. Input the relevant data for Item 2 credit side and Post the document. Note: The recurring entry will be posted as part of period end process.
In the Create Posting Documents from Recurring Documents screen, enter data in the following fields:. Enter SM35 in the Command field and press Enter. Select the Batch input session name. Choose the Process button. Note: To display the recurring documents posted use T-code: FB OIM GL accounts require daily monitoring to ensure items are cleared on an ongoing basis and no back log accumulate, as this would create unnecessary distraction at month end and would slow down the closing process.
When the balance of this GL account is not zero, it must represent payments rejected by the bank that have not yet been reissued by the UN. Below are the process steps to follow in clearing the account. Cash Payment Rejected by Bank. Step 1. When the bank reconciler sees a rejected payment on the bank statement, records the following through FEBAN :. Bank Clearing Account. Your fund. Your Bus Area. Step 2. When payment is reissued through FV60 , we record:.
Cash Payment Rejected by Bank - match assignment. Accounts Payable. Step 3. When the balance of this GL account is not zero, it must represent cash in transit no yet received by the cash custodian petty cash, imprest or cashier's imprest. Below are the steps in cash replenishment process. Cash Journal Clearing.
When you replenish:. KH 31xx. Cash Journal. Cash Journal Clearing - match assignment. The balance in this GL account should be zero at all time since the debit and credit lines are system generated and automatically cleared. No manual entries should be posted to this GL account. Invoice Reduction Clearing. When the invoice has an amount higher than the Goods Receipt, invoice is recorded as part of MIR7 document:.
RE 51xx. Vendor - full invoice amount overstated amount. GR-IR actual amount received. KG 32xx. Vendor - amount of the reduction. Invoice Reduction Clearing - Automatic Clearing. Accruals originating from conversion doc type X3. These types of accruals are cleared with invoices and journal entries JVs. Accrued Expense Man. Converted Documents:. X3 78xx. SAP Conversion Account. Accrued Expense Man - Matched Assignment.
Refund of PY Expenditures. Step 4. Post conversion accruals. Accruals created with FBS1 are reversed automatically and are automatically cleared upon reversal. Accruals Post Conversion:. SZ 13xx. Accrued Expense Man - Automatic Clearing. In the following period. Entries to this GL account are system generated and are cleared automatically. There should be no manual postings to this GL account. If the balance of this GL account is not zero, it must represent discounts available on invoices not yet paid.
AP Accrued Discount Clearing. Vendor full invoice amount. MIR7 or FV GR-IR or Expense full amount received. Accrued Discount Clearing. Amount of discount. Bank clearing amount net of discount taken. Accrued Discount Clearing - Automatic Clearing.
If the balance of this GL account is not zero, it must represents invoices or down payments that are due to be paid in cash by the Cashier. All open items in this GL account should be short term. AP Cash Payment Clrg. KY 35xx. Vendor with SP GL. When Goods Receipt is done with Movement Type WE 82xx.
Expense is determined by Product Category. When MIR7 Invoice is recorded. MIR7 - invoice. Variant A:. When Goods Return is done with Movement Type MIR7 - credit memo. When an invoice is received after conversion, the invoice should be processed with FV60 and should debit this GL account with the same assignment as the converted document. When the invoice has a different amount than the converted document doc type X3 , the difference should be recorded with a journal entry JV with the same assignment as the X3 document and with an offset to either Refund of PY Expenditures for credit or expense debit.
GR-IR Conversion. FV50 -Adj for difference. The balance of this GL account should be zero at month end. Progen Payroll Net Pay Clearing. Progen Interface. Summarized at coding block level. SB Expenses. The balance of these GL accounts should be zero at month end.
Progen Payroll Clearing Accounts Others. Progen Payroll Clearing Acct-detailed. Expenses for UN portion. Progen Payroll Clearing Acct-bulk entry. IOV-bulk entry. Progen Payroll Clearing Acct. If the balance is not zero, the balance must reflect cash received at the bank that is not identified and applied to a customer or vendor. Below are the process steps to clear the GL account.
AP Unapplied Cash. Incoming Payment. S or your BA. DC 25xx. Doc 1. If the balance is not zero, the balance must reflect cash received by Cashier in cash or cheque that is not identified and applied to a customer or vendor.
AP Unapplied Cash Journal. Business Transaction: Revenue. F or. KC 34xx. Entries to this GL account are automatically generated by the system as the balancing postings when there is a non-budget relevant statistical movement of fixed assets or inventory between two funds or grants. Non-budget relevant transfers are also referred to as an internal donation of assets. Users define budget relevant or non-budget relevant transactions through the use of Movement Types in the Inventory or Fixed Assets Management module which will affect the GL use in the balancing posting.
Clearance of this account needs to be done by the Senior Asset Accountant role. AR Due to Due From. When fixed asset or inventory is being transferred between two funds or grants. Fixed Asset Module or. Fund 1. Inventory Module. Fund 2. Bus Area 2. Bus Area 1. To clear the GL account, document type SF must be selected. Clear the documents posted to the GL account.
Workflows are used to forward financial documents for review to the appropriate approvers. Documents created by the Financial Accounting User are subject to workflow approval before they can be posted. Whereas Financial Accounting Senior User is able to create GL documents, such as accruals, reversals and recurring entries that are not subject to workflow approval. Once the document is in workflow, it cannot be amended until the time Approving Officer has either approved or rejected it.
However, workflow for parked documents can be viewed using T-code FB Enter the document number and press Enter. On the selected document screen, select Workflow overview to see which approving office can approve the document.
The pop up window will show the names of the Approving Officer who can approve the document. The document will appear in their Workflow Inbox. Note: The 'X' indicates that the person highlighted was the creator of the parked document. This process is only applicable to the Approving Officer. The Approving Officer can approve the document through Workflow Inbox. To approve the document, double click on the document number.
To first see the document before approving, click on Display Parked Doc. Once the approver is ready to post, another screen pops up with three options: Approve, Refuse and Cancel. To replace the document, select Cancel and click on Replace icon in the Workflow Inbox.
This action will put the document back in workflow and other Approving Officer can see and take action on it. The reports used across General Ledger processes are:. This report brings up GL account entries based on selections that are normally used. In the open screen, click Choose Ledger button.
Select the ledger to which the report will be based on and click the button to confirm the selection. Click Execute to run the selection and display the Account Line Item report. This report brings up all journal documents posted to a General Ledger account. The report also gives option to run report with only parked items for control purposes. Enter data into the respective fields:.
General selections section:. Execute the selections to generate the report. The trial balance report displays financial data for all UN accounts contained in the General Ledger. Enter data into the following fields:. Selection Criteria section:. Additional Selection Criteria section:. Click the Execute icon. Financial Accounting User assigned with a Closing role is responsible to see through the closing process.
The User is responsible for:. The end of each period is characterised by a series of activities, including:. These activities do not occur sequentially but overlap to provide time for the GL to be stated accurately for the prior accounting period. The closing lag time is used to correct entries, distribute costs and add entries as necessary.
Each phase is characterised by specific activities that must be completed to close the monthly accounting period and state the GL correctly. These activities must be completed by the last day of reporting for the period being closed.
Open next posting period for appropriate modules. In the first month of the year, the budget period must be opened. The Determine Work Area: Entry screen is displayed. Enter in the FM Area field and click on the button to confirm.
Transaction Code. Section Reference. Financial Accounting FI. Funds Management FM. Material Management MM. Controlling CO. For these modules, while prior accounting periods remain open they cannot accept entries that are transacted in the new period. Therefore, it is important to open a new posting period as part of the pre-closing activities. The screen accessed in Umoja to do this activity differs based on the type of posting period being opened.
Each area has its own ledger and therefore has to be opened separately. There is no rule in the system limiting the number of periods that can remain open simultaneously. The only exception is MM wherein two periods are kept opened at any one time.
Enter OB52 in the Command field. This is the main screen where all ledgers are opened and closed. Go to Edit , select New Entries and enter the required values in the following fields:. Fiscal Year Variant : Each ledger is represented by a different symbol account type :. S for General Ledger accounts. M for Material Management accounts inventory. A for Assets accounts. K for Vendor accounts. Typically the financial periods are open one at a time to ensure that the financial postings are not made in wrong period by mistake.
Click the Save icon. Enter in the FM Area field then click icon. To open a new period in the same fiscal year :. Note: This action opens period 8 and allows Funds Management transactions in this period. To open a new fiscal year :. Go to Edit and select New Entries. Enter values in the respective fields:. Note: By specifying that periods 1 to 6 are open, the system allows Funds Management transactions in those periods and blocks them being posted to any other periods. Before opening a new MM period, it is important to confirm that the prior period is still open.
This is to ensure that postings can still be made to prior period. Enter in the Company Code field. Ensure that Allow posting to previous per. Enter details in the following fields:. Select the Check and close period radio button. Enter OKP1 in the Command field. Click the Actual button to view the Actual Period Lock. Note: Checked boxes indicate that the corresponding periods are locked. Un-checked the relevant boxes to open the respective period. The purpose of this activity is to:.
To achieve the purpose, the following tasks need to be performed:. Use the following decision tree to analyse and determine next step to take in following up on parked FI documents. This activity is conducted to check and ensure that there are no parked documents outstanding prior to the closing of the period. It is recommended to conduct this check daily. Generate list of parked documents. The followings are ways to generate list of parked documents that FI Users can choose from to assist in reviewing and analyzing the FI parked documents.
This information is reviewed by the user to determine why the listed line items are open, whether they should be taken through workflow or whether they should be removed from workflow altogether. Enter MIR5 in the Command field. Enter details into the following fields:. Click the Invoice document number for each of the documents in the list.
Review the selected document s. View the Entered By column and reach out to the respective Users provided and notify Users to review and post relevant document s. This process is to view the entire financial accounting parked document and to provide users with a list off all warnings, information messages or errors for the selected documents generated in one log.
Enter FBV0 in the Command field. Click on the Document list button and List of Parked Documents screen is displayed. Fill in the following fields:. This Check function enables the system to list all warnings, information messages or errors for the selected documents in one log.
To review the entry, select a document from the list and from the navigation menu click Document and select Simulate General Ledger. Reach out to the users for them to review and post the document. A Workflow Status Report will need to be generated separately to follow up on Users responsible to further action the documents.
Status section:. Type section:. List Output section:. Click on Execute button to generate the list. Use the Workflow Status Report refer to next step to identify the Users where the documents at and notify the Users to action on the documents.
In the opening screen, enter information in the following fields:. Click Execute button to generate the report and follow the analysis decision tree to action the documents. The Data Collection Closing comprises of activities that ensure that all necessary accounting data generating during the former accounting period has been collected, processed and cleared in the GL.
This phase is characterised by the following six key activities. Umoja interfaces with a number of secondary systems, which run throughout the open period, but stop once the period is closed. Interfaces represent data entry points. It is therefore extremely important to ensure that the data being imported is current, correct and complete. Automated clearing will be run at month end, not in regular reconciliation activities.
Below are the steps:. Enter the following values:. Note: The Assignment field is typically used to clear debits and credits balances with the same value in assignment field. Posting parameters section:. Output Control section:. Run the program in test mode. Select the Execute button and review the output list. Choose Execute in Background mode by repeating the steps without the Test run mode. Note: The Execute in Background mode can be accessed from the Program option on the navigation menu.
The steps to check the status of the background job are as follows:. Enter SM37 in the Command field. Check the spool request. Period end closing in Treasury. The completion of this activity will comprise of the following tasks:. Treasury will be conducting its closing on a daily basis. The closing user will only be responsible for confirming with Treasury that closing as in fact occurred. For detailed process steps and related transaction codes, please refer to section 3. Complete controlling postings.
The completion of this activity is confirmed by the completion of the following tasks:. For purpose of month end period closing procedures, the Collective Settlement of internal orders is expected to be used. The following are the process steps:.
Enter the following sample values in the respective fields:. Run it in Test mode and select Execute button. Review the settlement of internal orders. Run in Background by repeating earlier steps without the Test Run mode and check the status:.
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