Clear Up the Confusion on the Two Kinds of PO "Accruals" Automatic Accounting Options
- by Kurt Goldsmith, Senior Business Consultant, Enowa Consulting
- September 15, 2004
The "Accruals" check box combined with an unobvious setting in the condition type instructs your R/3 system as to what kind of invoice you expect from vendors for indirect procurement costs—one for multiple purchase orders (POs) or one for just a single PO. The author explains why this choice can be confusing.
Most businesses have two kinds of vendors in each PO. The vendors for some kinds of indirect costs (such as duty) send a single invoice for each PO, while the vendors for other kinds of indirect costs (such as marine insurance) send a periodic invoice that covers a great many POs. If you would like SAP R/3 to accrue for these costs automatically each time a goods receipt for a PO is recorded, both scenarios require that you activate the Accruals check box in the condition type customization screen. However, the required setting to distinguish between the one-to-one invoicing situation (which you typically would want to post against the PO via the Logistics Invoice Verification [LIV] transaction) and the one-to-many invoicing situation (which you typically would want to post as a general invoice in the Accounts Payable module) is confusing. This is because the setting involved — a condition category of B — interacts with a choice the end user makes on the LIV screen between goods/services costs and planned delivery costs.
I recently spent a few months implementing SAP R/3 at a site that incurred five separate kinds of external costs with each purchase order (PO) that it sent out to a vendor. In addition to the obvious costs for the raw materials and the inbound freight came costs paid to vendors for marine insurance (cargo came by boat), for duty (US Customs), and for an initial stocking fee (rented warehouse). Five costs. Five vendors. One PO.
Although your company might not have quite this situation, you probably have instances in which a single PO leads to more than one vendor sending you an invoice. But what type of an invoice? Will that additional vendor look for single payment on a lot of activity that covers a large number of POs? Or will the vendor send a separate invoice for each relevant PO?
Your standard SAP R/3 system's automatic accounting can handle either of those two scenarios. However, the customization settings you'll need to work with could fool even an expert into thinking that your options are limited to just one. I will clear up this confusion with a couple of pointers and plenty of screenprints.
Sales Accrual vs. Purchasing Accrual
In the January 2004 issue of FI/CO Expert, I wrote an article about a customization setting in R/3 called the Accruals check box. You find this setting in the master definition screen for any condition type (i.e., price variable), such as the example shown in Figure 1.
An example condition type with its Accruals check box activated
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