Other Special G/L Transactions- Guarantees, payment requests, and creation of own Special G/L Transactions

 

Apart from the down payment and the down payment request discussed in the last blog post, other special G/L Transactions exist. In this week’s post, as promised, we will discuss the part 2 of our series on SAP Special G/L Transactions. We will discuss:
 
a) Guarantees and payment requests
b) Creation of own Special G/L Transactions.
 
1) Guarantees
 
A guarantee is an assurance or promise of the lending institution to cover the loss arising from the default of a borrower. To put it simply, if the debtor fails to pay the debt the bank/lending institution covers it. An organization can ask for a bank guarantee in a business relationship or be asked to provide the same as a requirement to conclude a particular sales/purchase transaction.
Note that no physical exchange of cash, goods or services happen at this time, this is just a guarantee that when such occurred the agreement will be honored by the parties or that the guarantee will be invoked.
Guarantees made or received are typical cases of a Special G/L Transaction in SAP. Guarantees made or given in a sales transaction are normally shown in the notes to the balance sheet. Likewise, Guarantees received in a purchase transaction are treated as off balance sheet items (meaning it is not normally displayed on the balance sheet). It is however a good practice to have an overview of the guarantees that you have received for internal use only and therefore to record it.
 
a) Guarantees Received
 
As noted above, guarantees received are off balance sheet items and are posted as special G/L transactions. . They are posted in the standard system as special G/L transactions in a form of a statistical posting. You post a guarantee received to your vendor’s account which is link to an alternative reconciliation account in configuration, the system then makes the offsetting entry automatically to a clearing account (you can call this Guarantees Clearing Account).
 
Follow the menu path below for the configuration of the Guarantees Received.
 
IMG — Financial Accounting (New) — Accounts Receivable and Accounts Payable — Business Transactions — Postings with Alternative Reconciliation Account — Define Alternative Reconciliation Account for Vendors
Or use transaction OBXT or FBKP

 

 
Select Special G/L indicator “G” and double click on it.
 

 
Click on properties
 

 
Maintain your settings.
 
Others: By selecting this indicator, you are simply saying that this special G/L Transaction is neither a bill of exchange, a bill of exchange payment request, a down payment, nor a down payment request.
 
Characteristic of the Guarantee Clearing account G/L
 
a) This G/L account should be defined as “post automatically only”.
b) Better to be defined as an open item management account.
c) This account will serve the purpose of an automatic offsetting account. The automatic offsetting account is assigned in configuration, as in the below steps:

 
Define Accounts for Automatic Offsetting Entry
 
In this configuration activity you assign the G/L accounts created for the purpose of automatic posting of the offsetting entry for specific special G/L transactions, (guarantees, bills of exchange etc.).

 
We follow the menu path below to define accounts for automatic offsetting entry:

IMG — Financial Accounting (New) – Accounts Receivable and Accounts Payable — Business Transactions — Postings with Alternative Reconciliation Account — Other Special G/L Transactions — Define Accounts for Automatic Offsetting Entry
 

 
Click on create or copy and enter your account for the purpose of automatic offsetting posting (in our case the (Guarantee Clearing account). We use the same account for account type DG (Guarantee Given) and KG (Guarantee Received). You may use a different G/L.

Save your entry.
 
Posting a Guarantee received Special G/L Transaction (statistical posting)
 
We will now go through an end user transaction of making a statistical posting by following the menu path below:
Accounting — Financial Accounting — Accounts Payable — Document Entry – Other — Statistical Posting
Or use transaction F-55

 

 

 
b) Guarantees Made
 
As noted above Guarantees made or given in a sales transaction are normally shown in the notes to the balance sheet. They are posted in the standard system as special G/L transactions in a form of a statistical posting. You post a guarantee made to your customer’s account which is link to an alternative reconciliation account in configuration, the system then makes the offsetting entry automatically to a clearing account (you can call this Guarantees Clearing Account).
 
Follow the menu path below for the configuration of the Guarantees made:

IMG — Financial Accounting (New) — Accounts Receivable and Accounts Payable — Business Transactions — Postings with Alternative Reconciliation Account — Define Alternative Reconciliation Account for Customers

Or use transaction OBXY or FBKP
 

 
Double click on the special GL Indictor “G”.
 

 
Maintain your account assignment, and double click on Properties.
 

 
Maintain your entries and save.
 
Posting a Guarantee Given Special G/L Transaction (statistical posting)
 
We again go through an end user transaction of making a statistical posting by following the menu path below:

Accounting — Financial Accounting — Accounts Receivable — Document Entry – Other — Statistical Posting

Or use F-38
 

 

 

2) Payment Requests
 
Payment requests are another Special G/L Transaction which create noted items, and are used to initiate partial or full payments of posted and parked invoices.
Among others things, it may be used to avoid loss of cash discount especially in the case of parked invoices (if you fear that discount will be lost before the final posting of the invoice).
 
Use the menu path below to do the necessary settings for the Payment Request Special G/L.

IMG — Financial Accounting (New) — Accounts Receivable and Accounts Payable — Business Transactions — Postings with Alternative Reconciliation Account — Define Alternative Reconciliation Account for Vendors

Or use transaction FBKP.
 

 
Select the Special G/L Indicator “P” and double click on it.
 

 
Maintain your account assignment.

Double click on Properties.
 

 
Maintain your entries and save.
 
Posting a Payment Request
 
We will now go through an end user transaction of posting a payment request as a noted item.
Follow the menu path below:

Accounting — Financial Accounting — Accounts Payable — Document Entry — Outgoing Payment — Payment Request

Or use transaction F-59

 

 
Document Number: specify the document number of the invoice to which the payment should refer.

Click on Line Item
 

 
Values from the invoice selected for the payment request transaction are defaulted. You change the default values. For example if we want to make a partial payment request we change the defaulted value in the amount field to say SAR 150,000.

Save you entries
 

 

Displaying the Noted Item on the Vendor
 

We now display our noted item on our vendor through the vendor line item display (transaction FBL1N).
 

 
Execute
 

 
Click on display.
 

 
Because a payment request creates a noted item, and not a posting that updates the accounting books, we only have a one line item record, with a posting key 39.
 
Clearing a Payment Request
 
We will clear the payment request through F110. We will execute the automatic payment program to pay the payment request created above. We will not go through all the steps because i assume that readers are familiar with this process.
 
This is the edit proposal screen:
 

 
You select here the payment request (that you created above with F-59), and you will see the invoice (1900000019), referenced in the payment request, beside the item.

Complete your automatic payment process.
 

 
If you execute FBL1N again you will see the payment request cleared by the F110 document.
 

 
The AB document “100000002” (the payment request) is cleared by the KZ document “2000000015”. In addition, we have a new open item (the KZ 2000000015). This will be cleared with the payment of the invoice (1900000019) reference in the payment request “F-59”.
 
Paying the Referenced Invoice
 
We now pay the main invoice referenced in our payment request (F-59). Note how this invoice is netted off against the payment of the payment request and how both the open items (1900000019 and 2000000015) are cleared in the process.
 
Now we execute F110.

This is the edit proposal screen.
 

 
Select both the invoice (1900000019) and the payment document of the payment request (2000000015), starting with the invoice.
 

 
Now display the payment.
 

 
We can see from the above that the system netted off the invoice amount USD 210,000 and the already paid portion from the payment request (USD 150,000) and paid the net USD 60,000.
 
Creating Own Special G/L Transactions
 
Even though SAP provided standard Special G/L Transactions with the relevant Special G/L indicators that you can readily use, a need might arise to create your own. This may be due to the fact that you have exhausted the standard provided ones or the Special G/L Indicator you need to use is already used.
If you have a business requirement for a new special G/L transactions and there is no available special G/L Indicator, you must create a new one. Probably the best way is to copy an existing one that satisfy your current need. For example:
 
a) If you require a Special G/L Transaction that should make a statistical posting, you may copy the indictor “G” for Guarantees and give it another identification. This identification can be any one character key (for example- alpha “N”, numeric “2” or special “#”). It must be noted that it is not recommended to use Special Characters as it may cause some reporting issues for you.
 
b) If you require a Special G/L Transaction that should be treated as a noted item, you may copy the indictor “F” for Down Payment request and give it another identification (see above).

 
An example of a situation requiring a creation of a Special G/L Transaction
 
Now, assuming we do not have a Share Capital system in place and we are using, say the SAP FI-AR to treat our shareholders as customers and recording called up capital against them and related payments from them. In addition to this the organization might want to record the Subscribed Capital, for example, as a noted item. This is an example of a special G/L Transaction.

We will go through the menu path:
 
IMG — Financial Accounting (New) — Accounts Receivable and Accounts Payable — Business Transactions — Postings with Alternative Reconciliation Account — Define Alternative Reconciliation Account for Customers

Or use transaction OBXY or FBKP

To create a new special G/L Transaction.
 

 
Click on the create button to create a new special G/L.
 

 
Account Type: Enter the account type, in our example it is Customer, so we select “D”.
Special G/L Indicator: you can use any 0ne key character that is not used before, we use “2”.
Name: Give it a short name, maximum seven character.

Press enter.
 

 
Maintain your selections.
Click on Accounts
 
Note: the meaning of most of the selection options above were explained in my last post. http://sapgurus.com/configuration-sap-special-gl-transactions/
 

 
Enter the required G/L accounts. The normal customer reconciliation account for the relevant customer account group, and the Special G/L account (to be used as an alternative reconciliation account).

Save your entries.
 
Note: You can create any “n” number of Special G/L Transactions (where legitimate requirements exist), by following the process just discussed above. However, the fact that special G/L indicators are represented by a one character key means you cannot define unlimited number of it.
 
In my last Blog a reader (Narendra Bodhisattva) made a very good comment, and i quote (with a little modification):

“Now a days, there is a need to increase the special GL character from 1 to 2 digit. There are varied business requirement, where special GL’s transactions further need to be categorized. Employee Advances cannot be considered only under one special GL, rather adv. against salary, marriage, travel, Furniture & fixtures, sundry, Telephone, Fuel etc. Business needs to further analyze the nature of transactions into lower level details. Since there is limitations of 34 special GL’s, so we have started special characters (!, @, #, $,%, ^, &, *, (,),_,+) also for identifying special GL transactions, but this is not correct. Such transactions when extracted to SAP BI, gives PSA level Dump & creates so much trouble in data loading. SAP need to look into this problem”.

 
We stop the discussion on the Special G/L Transactions here, for now, although we could not do enough justice to the topic in only 2 blog posts. We would love to hear your comments and suggestions.
 
 
 
 
 

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