SAP NOTES ON CONFIGURATION OF MM-FI ACCOUNT DETERMINATION & AUTOMATIC POSTINGS

MM-FI Integration

IMPORTANT SAP NOTES ON CONFIGURATION OF MM-FI ACCOUNT DETERMINATION & AUTOMATIC POSTINGS

1.      What are automatic postings?

Postings are made to G/L accounts automatically in the case of Invoice Verification and Inventory Management transactions relevant to Financial and Cost Accounting.

Example: 
Posting lines are created in the following accounts in the case of a goods issue for a cost center:

Stock account, Consumption account

How does the system find the relevant accounts?

When entering the goods movement, the user does not have to enter a G/L account, since the R/3 System automatically finds the accounts to which postings are to be made using the following data:

2.      Chart of accounts of the company code

If the user enters a company code or a plant when entering a transaction, the R/3 System determines the chart of accounts which is valid for the company code. 
You must define the automatic account determination individually for each chart of accounts.

3.      Valuation grouping code for the valuation area

If the automatic account determination within a chart of accounts is to run differently for certain company codes or plants (valuation areas), assign different valuation grouping codes to these valuation areas.

You must define the automatic account determination individually for every valuation grouping code within a chart of accounts. It applies to all valuation areas which are assigned to this valuation grouping code.

If the user enters a company code or a plant when entering a transaction, the system determines the valuation area and the valuation grouping code.

4.      Transaction/event key (internal processing key)

Posting transactions are predefined for those inventory management and invoice verification transactions relevant to accounting. Posting records, which are generalized in the value string, are assigned to each relevant movement type in inventory management and each transaction in invoice verification. These contain keys for the relevant posting transaction (for example, inventory posting and consumption posting) instead of actual G/L account numbers. You do not have to define these transaction keys, they are determined automatically from the transaction (invoice verification) or the movement type (inventory management). All you have to do is assign the relevant G/L account to each posting transaction.

Account grouping (only for offsetting entries, consignment liabilities, and price differences)

Since the posting transaction "Offsetting entry for inventory posting" is used for different transactions (for example, goods issue, scrapping, physical inventory), which are assigned to different accounts (for example, consumption account, scrapping, 
expense/income from inventory differences), it is necessary to divide the posting transaction according to a further key: account grouping code.

An account grouping is assigned to each movement type in inventory management which uses the posting transaction "Offsetting entry for inventory posting".

Under the posting transaction "Offsetting entry for inventory posting", you must assign G/L accounts for every account grouping, that is, assign G/L accounts.

If you wish to post price differences to different price difference accounts in the case of goods receipts for purchase orders, goods receipts for orders, or other movements, you can define different account grouping codes for the transaction key.

Using the account grouping, you can also have different accounts for consignment liabilities and pipeline liabilities.

Valuation class of material or (in case of split valuation) the valuation type

The valuation class allows you to define automatic account determination that is dependent on the material. for example: you post a goods receipt of a raw material to a different stock account than if the goods receipt were for trading goods, even though the user enters the same transaction for both materials. You can achieve this by assigning different valuation classes to the materials and by assigning different G/L accounts to the posting transaction for every valuation class.

If you do not want to differentiate according to valuation classes you do not have to maintain a valuation class for a transaction.

5.      Requirements

Before you maintain automatic postings, you must obtain the following information:

1. Valuation level (plant or company code) 
Establish whether the materials are valuated at plant or at company code level 
When valuation is at plant level, the valuation area corresponds to a plant. When 
valuation is at company code level, the valuation area corresponds to a company 
code.

2. Chart of accounts and valuation grouping code per valuation area 
Find out whether the valuation grouping code is active. 
Activate split valuation 
If it is not active, determine the chart of accounts assigned to each valuation area 
(via the company code). If it is active, determine the chart of accounts and the 
valuation grouping code assigned to each valuation area. Group valuation areas

You must define a separate account determination process for chart of accounts 
and each valuation grouping code.

3 Valuation class per material type

If you wish to differentiate the account determination process for specific 
transactions according to valuation classes, find out which valuation classes are 
possible for each material type Define valuation class

4. Account grouping for offsetting entries to stock accounts 
Under Define account grouping for movement types, determine for which 
movement types an account grouping is defined for the transaction/event keys 
GGB (offsetting entry to stock posting), KON (consignment liabilities) and PRD 
(price differences).

6.      Activities

1. Create account keys for each chart of accounts and each valuation grouping code 
for the individual posting transactions. To do so, proceed as follows:

a) Call up the activity Configure Automatic Postings.

The R/3 system first checks whether the valuation areas are correctly 
maintained. If, for example, a plant is not assigned to a company code, a dialog 
box and an error message appear. From this box, choose Continue (next entry) 
to continue the check.

Choose Cancel to end the check.

The configuration menu Automatic postings appears.

b) Choose Goto -> Account assignment.

A list of posting transactions in Materials Management appears. 
For further details of the individual transactions, see Further information. 
The Account determination indicator shows whether automatic account 
determination is defined for a transaction.

c) Choose a posting transaction.

A box appears for the first posting transaction. Here you can enter a chart of 
accounts

You can enter the following data for each transaction:

- Rules for account number assignments 
With Goto -> Rules you can enter the factors on which the 
account number assignments depend: 
- debit/credit indicator 
- general grouping (= account grouping) 
- valuation grouping 
- valuation class

- Posting keys for the posting lines 
Normally you do not have to change the posting keys. If you 
wish to use new posting keys, you have to define them in the 
Customizing system of Financial Accounting.

- Account number assignments 
You must assign G/L accounts for each transaction/event key 
(except KBS). You can assign these accounts manually or copy 
them from another chart of accounts via Edit -> Copy. 
If you want to differentiate posting transactions (e.g. 
inventory postings) according to valuation classes, you must 
make an account assignment for each valuation class. 
Using the posting transaction "Offsetting entry for inventory 
posting", you have to make an account assignment for each 
account grouping

If the transaction PRD (price differences) is also dependent on 
the account grouping, you must create three account assignments: 
- an account assignment without account grouping 
- an account assignment with account grouping PRF 
- an account assignment with account grouping PRA 
If the transaction KON (consignment and pipeline liabilities) is 
also dependent on the account grouping, you must create two 
account assignments: 
- an account assignment without account grouping (consignment) 
- an account assignment with account grouping (pipeline)

d) Save your settings.

Then check your settings with the simulation function. 
With the simulation function, you can simulate the following:

- Inventory Management transactions

- Invoice Verification transactions 
When you enter a material or valuation class, the R/3 system 
determines the G/L accounts which are assigned to the corresponding 
posting transactions. Depending on the configuration, the SAP system 
checks whether the G/L account exists 
In the simulation you can compare the field selection of the 
movement type with that of the individual accounts and make any corrections. 
If you want to print the simulation, choose Simulation -> Report. 
To carry out the simulation, proceed as follows:

a) Choose Settings to check the simulation defaults for 
- the application area (Invoice Verification or Inventory 
Management) 
- the input mode (material or valuation class) 
- account assignment 
Instructions

b) Choose Goto -> Simulation. 
The screen for entering simulation data appears.

c) Depending on the valuation level, enter a plant or a company 
code on the screen.

d) When you simulate Inventory Management transactions, goods 
movements are simulated. The R/3 system suggests the first 
movement type for simulation. If several movements are possible 
with this movement type, you can select a line. 
When you simulate Invoice Verification transactions, a list 
appears on the screen of the possible transaction types. Select 
a line.

e) Then choose Goto -> Account assignments. 
A list appears of the posting lines which can be created by the 
selected transaction. For each posting line, the G/L account for 
the debit posting as well as the G/L account for the credit 
posting are displayed.

f) From this screen, choose Goto -> Movement+ to get a list of the 
posting lines for the next movement type or transaction type. 
If you work with valuation classes, choose Goto -> Valuation 
class+ to receive the simulation for the next valuation class. 
This function is not possible when simulating with material 
numbers. 
Choose Goto -> Check screen layout to compare the movement type 
with the G/L accounts determined by the system and make any 
necessary corrections.

7.      Further Notes

• Expense/revenue from consumption of consignment material (AKO)

This transaction is used in Inventory Management in the case of 
withdrawals from consignment stock or when consignment stock is 
transferred to own stock if the material is subject to standard 
price control and the consignment price differs from the standard 
price.

• Expenditure/income from transfer posting (AUM)

This transaction is used for transfer postings from one material to 
another if the complete value of the issuing material cannot be 
posted to the value of the receiving material. This applies both to 
materials with standard price control and to materials with moving 
average price control. Price differences can arise for materials 
with moving average price if stock levels are negative and the stock 
value becomes unrealistic as a result of the posting. Transaction 
AUM can be used irrespective of whether the transfer posting 
involves a transfer between plants. The expenditure/income is added 
to the receiving material.

• Provisions for subsequent (end-of-period rebate) settlement (BO1)

If you use the "subsequent settlement" function with regard to 
conditions (e.g. for period-end volume-based rebates), provisions 
for accrued income are set up when goods receipts are recorded 
against purchase orders if this is defined for the condition type.

• Income from subsequent settlement (BO2)

The rebate income generated in the course of "subsequent settlement" 
(end-of-period rebate settlement) is posted via this transaction.

• Income from subsequent settlement after actual settlement (BO3)

If a goods receipt occurs after settlement accounting has been 
effected for a rebate arrangement, no further provisions for accrued 
rebate income can be managed by the "subsequent settlement" 
facility. No postings should be made to the account normally used 
for such provisions. As an alternative, you can use this transaction 
to post provisions for accrued rebate income to a separate account 
in cases such as the one described.

• Change in stock (BSV)

Changes in stocks are posted in Inventory Management at the time 
goods receipts are recorded or subsequent adjustments made with 
regard to subcontract orders.

If the account assigned here is defined as a cost element, you must 
specify a preliminary account assignment for the account in the 
table of automatic account assignment specification (Customizing for 
Controlling) in order to be able to post goods receipts against 
subcontract orders. In the standard system, cost center SC-1 is 
defined for this purpose.

Stock posting (BSX)

This transaction is used for all postings to stock accounts. Such 
postings are effected, for example:

- In inventory management in the case of goods receipts to own 
stock and goods issues from own stock

- In invoice verification, if price differences occur in 
connection with incoming invoices for materials valuated at 
moving average price and there is adequate stock coverage

- In order settlement, if the order is assigned to a material with 
moving average price and the actual costs at the time of 
settlement vary from the actual costs at the time of goods 
receipt

Because this transaction is dependent on the valuation class, it is 
possible to manage materials with different valuation classes in 
separate stock accounts.

Caution :

Take care to ensure that:

- A stock account is not used for any transaction other than BSX

- Postings are not made to the account manually

- The account is not changed in the productive system before all 
stock has been booked out of it

Otherwise differences would arise between the total stock value of 
the material master records and the balance on the stock account.

Revaluation of "other" consumptions (COC)

This transaction/event key is only relevant to Brazil. It is used if 
a revaluation report is used for company codes in Brazil. 
The revaluation report uses the actual prices determined by the 
material ledger/actual costing to:

- Revaluate costs on the basis of actual prices

- Post the price differences arising from "other" consumptions 
(e.g. consumption to cost center) to a collective account

This transaction/event key is needed to post the price differences. 
The account specified here is posted with the price differences for 
"other" consumptions.

o documentation currently available.

Small differences, Materials Management (DIF)

This transaction is used in Invoice Verification if you define a 
tolerance for minor differences and the balance of an invoice does 
not exceed the tolerance.

Purchase account(EIN), purchase offsetting account (EKG), freight 
purchase account (FRE)

These transactions are used only if Purchase Account Management is 
active in the company code.

Freight clearing (FR1), provision for freight charges (FR2), customs 
duty clearing (FR3), provision for customs duty (FR4) 
These transactions are used to post delivery costs (incidental 
procurement costs) in the case of goods receipts against purchase 
orders and incoming invoices. Which transaction is used for which 
delivery costs depends on the condition types defined in the 
purchase order. 
You can also enter your own transactions for delivery costs in 
condition types.

External service (FRL)

The transaction is used for goods and invoice receipts in connection 
with subcontract orders. 
If the account assigned here is defined as a cost element, you must 
specify a preliminary account assignment for the account in the 
table of automatic account assignment specification (Customizing for 
Controlling) in order to be able to post goods receipts against 
subcontract orders. In the standard system, cost center SC-1 is 
defined for this purpose.

External service, delivery costs (FRN)

This transaction is used for delivery costs (incidental costs of 
procurement) in connection with subcontract orders. 
If the account assigned here is defined as a cost element, you must

Offsetting entry for stock posting (GBB)

Offsetting entries for stock postings are used in Inventory 
Management. They are dependent on the account grouping to which each 
movement type is assigned. The following account groupings are 
defined in the standard system:

- AUA: for order settlement

- AUF: for goods receipts for orders (without account 
assignment) 
and for order settlement if AUA is not maintained

- AUI: Subsequent adjustment of actual price from cost center 
directly 
to material (with account assignment)

- BSA: for initial entry of stock balances

- INV: for expenditure/income from inventory differences

- VAX: for goods issues for sales orders without 
account assignment object (the account is not a cost 
element)

- VAY: for goods issues for sales orders with 
account assignment object (account is a cost element)

- VBO: for consumption from stock of material provided to 
vendor

- VBR: for internal goods issues (for example, for cost 
center)

- VKA: for sales order account assignment 
(for example, for individual purchase order)

- VKP: for project account assignment (for example, for 
individual PO)

- VNG: for scrapping/destruction

- VQP: for sample withdrawals without account assignment

- VQY: for sample withdrawals with account assignment

- ZOB: for goods receipts without purchase orders (mvt type 
501) 
- ZOF: for goods receipts without production orders 
(mvt types 521 and 531)

You can also define your own account groupings. If you intend to 
post goods issues for cost centers (mvt type 201) and goods issues 
for orders (mvt type 261) to separate consumption accounts, you can 
assign the account grouping ZZZ to movement type 201 and account 
grouping YYY to movement type 261.

Caution

If you use goods receipts without a purchase order in your system 
(movement type 501), you have to check to which accounts the account 
groupings are assigned ZOB 
If you expect invoices for the goods receipts, and these invoices 
can only be posted in Accounting, you can enter a clearing account 
(similar to a GR/IR clearing account though without open item 
management), which is cleared in Accounting when you post the vendor 
invoice. 
Note that the goods movement is valuated with the valuation price of 
the material if no external amount has been entered. 
As no account assignment has been entered in the standard system, 
the assigned account is not defined as a cost element. If you assign 
a cost element, you have to enter an account assignment via the 
field selection or maintain an automatic account assignment for the 
cost element.

Purchase order with account assignment (KBS)

You cannot assign this transaction/event key to an account. It means 
that the account assignment is adopted from the purchase order and 
is used for the purpose of determining the posting keys for the 
goods receipt.

Exchange rate differences in the case of open items (KDM)

Exchange rate differences in the case of open items arise when an 
invoice relating to a purchase order is posted with a different 
exchange rate to that of the goods receipt and the material cannot 
be debited or credited due to standard price control or stock 
undercoverage/shortage.

Differences due to exchange rate rounding, Materials Management 
(KDR)

An exchange rate rounding difference can arise in the case of an 
invoice made out in a foreign currency. If a difference arises when 
the posting lines are translated into local currency (as a result of 
rounding), the system automatically generates a posting line for 
this rounding difference.

Consignment liabilities (KON)

Consignment liabilities arise in the case of withdrawals from 
consignment stock or from a pipeline or when consignment stock is 
transferred to own stock. 
Depending on the settings for the posting rules for the

transaction/event key KON, it is possible to work with or without 
account modification. If you work with account modification, the 
following modifications are available in the standard system:

- None for consignment liabilities

- PIP for pipeline liabilities

Offsetting entry for price differences in cost object hierarchies 
(KTR)

The contra entry for price difference postings (transaction PRK) 
arising through settlement via material account determination is 
carried out with transaction KTR.

Price differences (PRD)

Price differences arise for materials valuated at standard price in 
the case of all movements and invoices with a value that differs 
from the standard price. Examples: goods receipts against purchase 
orders (if the PO price differs from the standard pricedardpreis), 
goods issues in respect of which an external amount is entered, 
invoices (if the invoice price differs from the PO price and the 
standard price). 
Price differences can also arise in the case of materials with 
moving average price if there is not enough stock to cover the 
invoiced quantity. In the case of goods movements in the negative 
range, the moving average price is not changed. Instead, any price 
differences arising are posted to a price difference account. 
Depending on the settings for the posting rules for 
transaction/event key PRD, it is possible to work with or without 
account modification. If you use account modification, the following 
modifications are available in the standard system:

- None for goods and invoice receipts against purchase orders

- PRF for goods receipts against production orders and 
order settlement

- PRA for goods issues and other movements

- PRU for transfer postings (price differences in the case 
of external amounts)

Provision for delivery costs (RUE)

Provisions are created for accrued delivery costs if a condition 
type for provisions is entered in the purchase order. They must be 
cleared manually at the time of invoice verification.

Taxes in case of transfer posting GI/GR (TXO)

This transaction/event key is only relevant to Brazil (nota fiscal).

Revenue/expense from revaluation (UMB)

This transaction/event key is used both in Inventory Management and 
in Invoice Verification if the standard price of a material has been 
changed and a movement or an invoice is posted to the previous 
period (at the previous price).

Unplanned delivery costs (UPF)

Unplanned delivery costs are delivery costs (incidental procurement 
costs) that were not planned in a purchase order (e.g. freight, 
customs duty). In the SAP posting transaction in Logistics Invoice 
Verification, instead of distributing these unplanned delivery costs 
among all invoice items as hitherto, you have the option of posting 
them to a special account. A separate tax code can be used for this 
account.

Input tax, Purchasing (VST)

Transaction/event key for tax account determination within the 
"subsequent settlement" facility for debit-side settlement types. 
The key is needed in the settlement schema for tax conditions.

Goods issue, revaluation (inflation) (WGI)

This transaction/event key is used if already-posted goods issues 
have to be revaluated following the determination of a new market 
price within the framework of inflation handling.

Goods receipt, revaluation (inflation) (WGR)

This transaction/event key is used if already-effected transfer 
postings have to be revaluated following the determination of a new 
market price within the framework of inflation handling. This 
transaction is used for the receiving plant, whereas transaction WGI 
(goods receipt, revaluation (inflation)) is used for the plant at 
which the goods are issued.

GR/IR clearing (WRX)

Postings to the GR/IR clearing account occur in the case of goods 
and invoice receipts against purchase orders. For more on the GR/IR 
clearing account, refer to the SAP Library (documentation MM 
Material Valuation). 
Caution 
You must set the Balances in local currency only indicator for the 
GR/IR clearing account to enable the open items to be cleared. For 
more on this topic, see the field documentation.

Path 
Valuation Andà Materials Management àIMG (Implementation Guide)   Account Determination withoutà Account Determination àAccount Assignment   Configure Automatic Postingsàwizard 

Note: Configuration related to the above for growel attached as Annexure

Define Accounts for Materials Management

In this step, you store accounts for Materials Management transactions that lead to automatic postings in Financial Accounting.

Store the required accounts for every transaction that is posted in your company.

Path 
 General Ledgerà Financial Accounting àIMG (Implementation Guide)   DefineàMaterials Management à Integration à Business Transaction àAccounting Accounts for Materials Management

Transaction Code OBYC

What MM does

Path 
Valuation Andà Materials Management àIMG (Implementation Guide)   Account Determination withoutà Account Determination àAccount Assignment   Define Valuation Controlàwizard 

Transaction Code OMVVM

For account determination, you can group together valuation areas by activating the valuation grouping code. This makes the configuration of automatic postings much easier.

In the standard SAP R/3 System, the valuation grouping code is set to active.

Activities

Set the valuation grouping code.

Notes on transport

In this step, you maintain the table TCURM. This table activates/deactivates key functions in the client. It:

Defines the valuation level (plant / company code), Activates the Late material block, 
Activates split valuation

Since the automatic transport of an indicator could activate/deactivate other functions, you cannot use the automatic transport function here.

Maintain the Customizing function manually in the target system.

For the first Customizing transport to a target system that is not yet productive, you can transport the table manually. To do this, you must include the entry R3TR TABU TCURM in the transport request.

Group Together Valuation Areas

In this step, you assign valuation areas to a valuation grouping code.

The valuation grouping code makes it easier to set automatic account determination. Within the chart of accounts, you assign the same valuation grouping code to the valuation areas you want to assign to the same account.

Valuation grouping codes either reflect a fine distinction within a chart of accounts or they correspond to a chart of accounts.

Within a chart of accounts, you can use the valuation grouping code

to define individual account determination for certain valuation areas (company codes or plants), to define common account determination for several valuation areas (company codes or plants)

Requirements

You must have activated the valuation grouping code in the step Define valuation control. 
Define valuation control

You must have defined the valuation level in corporate structure Customizing. 
Define valuation level

You must have assigned each plant to a company code in "Corporate structure" Customizing. When assigning your plants, the valuation areas are defined automatically. 
Assign plant to company code

Recommendation

We recommend that you only use a valuation grouping code within a chart of accounts in order to prevent account determination from becoming confusing.

Path 
Valuation Andà Materials Management àIMG (Implementation Guide)   Account Determination withoutà Account Determination àAccount Assignment   Group Together Valuation Areasàwizard 

Transaction Code OMVVD

Following are the settings done

Define Valuation Classes

In this step, you define which valuation classes are allowed for a material type.

If a user creates a material, he must enter the material's valuation class in the accounting data. The R/3 System uses your default settings to check whether the valuation class is allowed for the material type.

The valuation class is a group of materials with the same account determination. If a transaction is to be posted to different accounts depending on the valuation class, create an account determination for each valuation class in the step Create automatic postings.

The valuation classes allowed depend on the material type. Several valuation classes are generally allowed for one material type. A valuation class can also be allowed for several material types.

The link between the valuation classes and the material types is set up via the account category reference.

The account category reference is a combination of valuation classes. Precisely one account category reference is assigned to a material type.

Requirements

You must have defined your material types. You must have defined the chart of accounts, You must have agreed with Financial Accounting which materials are 
assigned to which accounts.

Default settings

In the standard SAP R/3 System, an account category reference is created for each material type. The account category reference is, in turn, assigned to precisely one valuation class. This means that each material type has its own valuation class.

Recommendation

We recommend that you create the account groups of your chart of accounts as an account category reference.

Activities

1. Create account category references under account category reference

2. Under valuation class, define the valuation classes for each account category 
reference

3. Under Material type/account category reference, assign an account category 
sreference to each material type.

Path 
Valuation Andà Materials Management àIMG (Implementation Guide)   Account Determination withoutà Account Determination àAccount Assignment   Define Valuation Classesàwizard 

Transaction Code OMSK

Following are the settings made

Account Category Reference

Valuation Classes

Material Type/ Account Category Reference

Define Account Groupings for Movement Types

Using this function, you can assign an account grouping to movement types. The account grouping is a finer subdivision of the transaction/event keys for the account determination.

Example with ChOA-INT

During a goods movement, the offsetting entry for the inventory posting (transaction GBB) can be made to different accounts, depending on the movement type:

Movement Type Account Grouping Account 
561 Init. entry of stock bal BSA 399999 
201 GI for cost center VBR 400000

Standard Settings

The account grouping is provided for the following transactions:

o GBB (offsetting entry for inventory posting) 
Overview of account groupings GBB

o PRD (price differences) 
Overview of account groupings PRD

o KON (consignment liabilities) 
Overview of account groupings KON

The account grouping in the standard system is only active for transaction key GBB (offsetting entry for inventory posting).

Recommendation

We recommend that you use the default setting.

Activities

You do not have to carry out any activities here if you are using the default setting.

You can also define your own account groupings for transaction GBB.