Intercompany Matching and Reconciliation (Overview)

Intercompany Matching and Reconciliation (IXMR) is introduced to speed up your intercompany reconciliation process from company close to corporate close. As a built-in solution in SAP S/4HANA, it matches transactions without any ETL (extract, transform, load) processes and reconciles your financial data in real time.

By defining flexible matching and reconciliation rules, you can achieve high degrees of automation and continuous accounting. In addition, its in-app communication and workflow features eliminate the latencies very often seen in dealing with intercompany discrepancies, and, at the same time, improves visibility and transparency of your reconciliation process.

Quick Start: https://help.sap.com/docs/SAP_S4HANA_ON-PREMISE/4ebf1502064b406c964b0911adfb3f01/abf612512980408a9c242c273f0490dc.html

Based on your defined reconciliation case, which aggregates amounts of your selected data sets, you can view the reconciliation status and balance details between companies or between other organizational units.

With the matching engine, intercompany document items can be auto-matched line by line.

Matching rules can be defined flexibly, for both exact-match, suggested, or exceptional-match patterns. You can trigger matching runs either directly from the SAP Fiori apps or by scheduling recurring background jobs. Upon completion of a matching run, you can check the matching results and process the discrepancies by executing workflows and auto-adjustments.

If you want the auto-adjustment to be approved before taking place, you need to attach a workflow scenario to your reason code. The standard workflow scenario WS78500087 is delivered for the variance adjustment approval. Therefore, you can define your workflows for the auto-adjustment process with the Manage Workflows - Intercompany Variance Adjustment app.

For the items, either perfectly matched or nearly matched and still with variances, reasons should be provided to facilitate future analysis and explanations. In addition, the recommended solutions can be attached to increase efficiency and achieve automatic resolution.

1. SF_JOURNAL_ENTRIES_03 (Intercompany Journal Entries for Accounting): For comparing journal entry data from the Universal Journal Entries (table ACDOCA) for entity pairs such as company and trading partner company.

2. SF_JOURNAL_ENTRIES_02 (Intercompany Journal Entries for Consolidation): For comparing journal entry data from the Universal Journal Entries (table ACDOCA) and Consolidation Journal Entries (table ACDOCU) for entity pairs such as consolidation unit and partner unit.

A matching method is a collection of matching rules and is used to match items between two data sets.

Each matching rule narrows down the data source into two data slices using filters. Later in a matching run, the system first reads data based on the filters set for data slices and then applies the matching rule expressions to the filtered data.

If the items from each slice agree with each other, they are grouped under a matching assignment number. The data not yet in agreement is subject to the next matching rule.

Under the Attributes section, select the Behaves like master data checkbox if you want to set the matching method as master data, as opposed to configuration data. Master data is usually defined directly in the production system or transported between systems via the export and import features.

If you leave the checkbox unselected, the matching method is part of configuration, which can be transported between systems, for example, from the quality system to the production system, via transport requests. Any necessary changes can only be made in the source system where the reconciliation case was originally defined.

Under the Data Sources section, select a data source that forms the matching context. SF_JOURNAL_ENTRIES_03 includes data from ACDOCA.

You can define filters for the data source to further narrow down your data set to be matched. For example, you can use the accounting ledger and G/L account number to filter the data.

Data Sources: https://help.sap.com/viewer/4ebf1502064b406c964b0911adfb3f01/1909.000/en-US/92bf516f6b5a41bdb605c37ddded1567.html

Matching Rules: https://help.sap.com/viewer/4ebf1502064b406c964b0911adfb3f01/1909.000/en-US/885a3eb67393430291c54d62c6eb9390.html

The reconciliation case has a one-to-one mapping relationship with matching method. It consists of one or more display groups, which are used to filter and display the data in the reconciliation overview and balance detail reports. It is intended to provide aggregated views of the data set defined by the matching method.

A display group is comprised of two sides, typically the leading unit side and partner unit side, and tolerance settings. Each side sums up the amounts of a data subset. The display group can be used to display different aggregated views. For example, you can define a display group that has two sides: Accounts payable (AP) of the leading unit (company) and accounts receivable (AR) of the partner unit (trading partner company). You can also define the opposite display group with AR of the leading unit and AP of the partner unit.

To sort out the differences more easily, you can define subgroups, for example, to subdivide AR items by product or service account. However, one display group should be defined as the leading display group, which is used to calculate the overall balance status in the Reconciliation Status Overview app.

Specify a tolerance amount or percentage for each amount type. Later in the reconciliation report, the differences between company and trading partner postings are compared with the tolerance and result in different statuses.

FYV and Chart of Accounts Alignment: https://help.sap.com/viewer/DRAFT/4ebf1502064b406c964b0911adfb3f01/1909.001/en-US/c9027ed077454271a7dd6d1b7b4b542b.html

Under the Sides subsection, two sides are displayed, the leading unit side and partner unit side. Both sides may have one same data source or two different data sources, depending on the assigned matching method definition.

For each side, you can define additional filters so that it sums up the amounts of a subset. For example, you can define a display group that has two sides: Accounts payable (AP) of the leading unit and accounts receivable (AR) of the partner unit.

The leading amount is used to calculate balances in recon status report. And later, it is used for elimination difference calculation.

In the example below, the filters are set to:

• Only display posting keys 01 and 31 values.

If you have created multiple display groups, you must do the following:

• One display group must be set as the leading group, which will be used as a basis for calculating reconciliation status in the overview report.
• Optionally, you can pair up two display groups so that an intercompany netting view can be established later in the reconciliation balance report. The paired display groups must contain exactly the opposite sides to each other. For example, if display group 1 has filter A for leading unit defined and filter B for partner unit, the paired display group 2 must have filter B for the leading unit and filter A for the partner unit.

With this app, you can display the YTD and period amounts of your specified organizational units and their partner units and their amount differences in a specific fiscal year/period based on the reconciliation case you choose.

You can use Netting if the display groups are paired in the Reconciliation Case.

For the continuous incoming documents from the underlying data sources, you can launch the matching run individually or via background jobs. Matching populates the ICADOCM table.

You can run matching several ways:

• Use the Define Matching Methods app.
• Use the Manage Assignments - By Matching Method app.
• Use the Manage Assignments - By Reconciliation Case app.
• Use the Schedule Matching Runs app.

From each data row of any trading unit pair within the Reconciliation Balances app, you can navigate to the Manage Assignments - By Reconciliation Case app, where you can view the matched items and manually assign the items that are not matched yet.

1. Select the reconciliation case you want to use.

2. In the mandatory filter fields Display Group, Amount Field, and Currency as well as those derived based on the underlying data source, enter the filter values.

3. Choose Go to show all unassigned items for your selected leading unit and all its partner units who have trading records with the leading unit during the relevant period.

4. Choose Auto Match to run matching for unmatched items, so that the items are compared by all matching rules sequentially.

5. Once the matching run is finished successfully, you can check any matched items and their generated assignment numbers in the lower table Assignments. From there, you can proceed with manual assignments, adjustments, or approval as necessary.

Manage Assignments: https://help.sap.com/viewer/4ebf1502064b406c964b0911adfb3f01/1909.000/en-US/7570a4b5e63c4103bf947b7b9454d1e1.html

For any items, matched or unmatched, you can take the following actions:

• Assign: This is a manual match in case the matching rules don't apply. If you think certain unmatched items should be exempted from matching rule validation and matched manually, for example, when amounts agree but with different currencies due to the negligence in posting, you can select the items and choose Assign to match them manually and give them an assignment number. The assigned items are moved to the list in the lower area table Assignments.

• Communicate:
  • Add Note: Add a public comment and optionally, a due date. It results in the communication status Note Added. Based on your set due date, any overdue matching items are highlighted with a red indicator. These are only viewed from the assigned items log.
  • Send Notification: Send a notification to selected recipients, and optionally, a due date. As a result, the communication status changes to Notification Sent and the recipients receive the notification in the header bar of the SAP Fiori launchpad.
  • Set to Done: When a certain comment or notification is addressed, you can set the item to done so that the due date and overdue alarm are cleared.

With this app, you can monitor the line item-level matching status and aggregation-level reconciliation status for your specified reconciliation case, fiscal year/period, and organizational units.

Matching status is calculated based on the leading display group. For example, for the leading display group AR → AP, the number of Not Assigned items of a company is calculated with the following logic: All unassigned AR items of the company plus all unassigned AP items of its trading partners.

That is a sum of items displayed in both Leading Unit: Unassigned and Partner Units: Unassigned tables of the Manage Assignments app. It is not to be confused with the number of all items (AR and AP) of the company.

Items with status 00 New haven’t been processed by the matching engine and are therefore not counted.

For each organizational unit data row, you can choose Details icon (>) to navigate to the Reconciliation Balances report, where YTD and period amounts are displayed for this organizational unit and all its partner units.

Reconciliation Status Overview : https://help.sap.com/viewer/4ebf1502064b406c964b0911adfb3f01/1909.000/en-US/e6966fee22854129a6f34b25f99f777a.html