Document Splitting (Part I)

Document Splitting (Part I)

Background

Document splitting is a feature introduced by SAP in New G/L Accounting. This feature was introduced to do away with the users’ requirement to transfer the balances of Balance Sheet items at period ends.

Document Splitting automatically splits the line items based on the dimensions configured or to effect zero balance setting. It creates additional lines for the same.

Given below is the list of dimensions that can be set for splitting:

Segments

Profit Centres

Business Areas

Use

The document splitting helps in drawing financial statements at above dimensions on real time basis. For e.g. the Balance Sheet can be drawn at Business Area level, which may be one of the requirement of Management.

Implementation Consideration

The functionality of Document Splitting needs following assignments/configurations

Step I

Specifying the characteristics for which splitting is to be performed:

IMG Path: Financial Accounting (New)>General Ledger Accounting (New)>Business Transactions>Document Splitting > Define Document Splitting Characteristics for General Ledger Accounting

This is the first and foremost important step in document splitting. In this step we define the characteristics for which document splitting needs to be done. Here we have to define the following

Fields: Business Area/Profit Centre/Segment

Zero Balance

Activating this indicator will check the transactions values to total to zero. If the total of is not zero, then the system generates additional line items in “General Ledger View” of the document.

Partner Field

If you specify a partner field, a sender/receiver relationship is thendocumented in the additionally created clearing lines.

Mandatory Field

This indicator verifies every line item for the values for characteristics. If any of the values is missing then system throws error “Balancing field ______ in line item ____ not filled”

Step II

G/L Accounts

IMG Path: Financial Accounting (New)>General Ledger Accounting (New)>Business Transactions> Document Splitting > Classify G/L Accounts for Document Splitting

In this step, we assign Item Categories to G/L Accounts. The item category assigned to a G/L account determines the nature of G/L Account.

Note: The numbering of G/L Accounts in Chart of Accounts becomes very critical, as one can assign item category to a particular number range of G/L Accounts. For e.g. all the G/L Accounts starting from 21400000 to 21499999 shall be assigned to Category “04000” i.e. Bank account.

Refer Chart of Accounts

Following Item Categories are available in standard system:

Cat.      Desccription

01000    Balance Sheet Account

01001    Zero Balance Posting (Free Balancing Units)

01100    Company Code Clearing

01300    Cash Discount Clearing

02000    Customer

02100    Customer: Special G/L Transaction

03000    Vendor

03100    Vendor: Special G/L Transaction

04000    Cash Account

05100    Taxes on Sales/Purchases

05200    Withholding Tax

06000    Material

07000    Fixed Assets

20000    Expense

30000    Revenue

40100    Cash Discount (Expense/Revenue/Loss)

40200    Exchange Rate Difference

80000    Customer-Specific Item Category

Step III

Document Types

Financial Accounting (New)>General Ledger Accounting (New)>Business Transactions> Document Splitting > Classify Document Types for Document Splitting

In this step, we assign every document type to Transaction and Variant.

List of Transactions that can be assigned to the document types

0000       Unspecified posting

0100       Transfer posting from P&L to B/S account

0200       Customer invoice

0300       Vendor invoice

0400       Bank account statement

0500       Advance tax return (regular tax burden)

0600       Goods Receipt for Purchase Order

1000       Payments

1010       Clearing transactions (account maint.)

1020       Resetting cleared items

The combination of transaction and variant determine the splitting method to be used during document splitting process. The transaction and variant also identifies the type of accounts allowed in the document during document splitting. Refer Document splitting Rule section in the post.

For e.g. the accounting transaction 0200 (customer invoice), variant 0001 (standard), is delivered. In this accounting transaction, the following item categories are allowed: customer, value added tax, withholding tax, expense, revenue, exchange rate differences, and company code clearing.

Tip

SAP system comes with this assignment for standard document types. In case of customized document types, the assignment should be done by referring relevant standard document type. For e.g. if we create a customized document type for Bank Receipt, then the assignment done for standard document type KZ should be used for the new document type.

Step IV

Zero Balancing

Financial Accounting (New)>General Ledger Accounting (New)>Business Transactions> Document Splitting > Define Zero-Balance Clearing Account

Here we can define the account assignment objects for which we want system to have zero balance setting, by doing this we ask the system to verify if the balance of account assignment object (balance at the level of Business Area/Profit Centre/Segment) is zero. If system does not find the balance to be zero, then it generates additional line items to make the balance zero.

Note: A G/L Account should be created to assign for zero balance functionality.

Step V

Activating Document Splitting

IMG Path: Financial Accounting (New)>General Ledger Accounting (New)>Business Transactions> Document Splitting > Activate Document Splitting

In this step we activate Document Splitting functionality by assigning the Document Splitting Method.

Further, following options are available at this screen:

Inheritance: With this option, system forwards the characteristics from the lines which contain them to the lines which do not.

For e.g. in case of Vendor invoice booking, the Profit Centre is passed from expense line items to vendor line items.

Standard A/c. Assignment

This option if activated along with Constant, the characteristics under the Constant are forwarded to the line items without characteristics. If this option is activated alongwith Inheritance, system forwards the characteristics as per Inheritance as explained above.

Tags#

Account Assignment Category, Balancing field profit centre, Business Transaction Variant, document splitting, SAP document splitting,