When and How Not to Split if Document Splitting Is Active

  • by Manish Dharnidharka, Director, SAP, PwC
  • July 19, 2011
Document splitting allows you to create balance sheets by organizational units other than company code. Line items such as vendor, customer, tax, discount, or bank are split based on characteristics such as profit center or segment. However, you might not always want to split some of these items. SAP ERP Central Component (SAP ECC) 6.0 enables you to prevent document splitting on specific line items.
Key Concept
Introduced with SAP ERP Central Component (SAP ECC) 6.0, transaction FAGL3KEH allows you to assign a default profit center for a company code and general ledger account combination. With it, you can prevent document splitting on items where it is not required.

Recently, I was asked on two occasions not to split specific line items where standard document splitting was configured. The items that the business did not want to split were tax at the time of vendor invoice and bank at the time of payment. For the tax line item, the client explained that tax is a corporate responsibility, and for this reason the tax line should not split, but be assigned to a corporate profit center. Similarly, banking was also considered a corporate responsibility, and for this reason, the cash or bank line items needed to be assigned to the corporate profit center.

The ability to prevent certain line items from splitting has been available since SAP ERP Central Component (SAP ECC) 6.0. I will show you how to set up this functionality in detail using the vendor invoice demo in the example of the tax line item scenario that I just described. I then make a payment for the invoice to demonstrate the corporate profit center assignment on the bank accounting line. I start with an overview of the standard document splitting configuration, which is already well documented, and then show what to change to prevent some items from splitting. After I show you the required changes, I execute the same transaction again so that you can see the differences.

Standard Document Splitting

Figure 1 shows a vendor invoice entry view, and Figure 2 shows the result of standard document splitting configuration. The trade payable and tax line items are split. The business wanted to split the payables, but prevent the split for the tax line item. For a tax line item, the business needed to post to the corporate profit center rather than derive the profit center from the offsetting line.

Manish Dharnidharka

Manish Dharnidharka has an MBA in finance and information systems and more than 16 years of experience in financial and management accounting. For the last 12 years, he has been working on SAP systems and has led several implementations in FI and CO, including New General Ledger Migrations and implementation. He is currently a Director at PwC.

 

 

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