Describing Automatic Account Determination

Different transactions in inventory management and invoice verification are relevant to accounting. The system records these transactions into an accounting document that contains the postings to the Finance General Ledger (G/L) accounts. The program should automatically determine the G/L accounts to which you make the postings in such a document.

For example, when you issue raw material for a production order, the system makes postings to stock accounts (under credits) and consumption accounts (under debits).

Automatic account determination is a procedure applied to accounting-relevant transactions and is used to identify the G/L accounts to which it makes postings without any user intervention. You must enter these accounts in a special table in Customizing for the transactions in inventory management and invoice verification.

Sample Automatic Postings

The figure describes the steps of the procurement process.

The procurement process above is based on the following business processes:

1. A purchase order was created with a quantity of 10 pieces at a price of EUR 12 per piece. The material is valued at a standard price of EUR 10 per piece.
2. In step 1, the goods receipt is posted.

   As a result of valuation using the standard price, the received quantity is posted to stock account 13100000 with a value of EUR 100 (10 pieces x EUR 10 standard price).

   An offsetting entry with a value of EUR 120 is made to the goods receipt/invoice receipt clearing account 21120000 because an invoice amount of EUR 120 (10 pieces x EUR 12 purchase order price) is expected.

   The EUR 20 difference between the order price and the valuation price is posted to price difference account 52041000. The price difference is booked as an expenditure because the order price is higher than the valuation price.

3. In step 2, the invoice receipt is posted.

   The invoice is for 10 pieces at EUR 11 = EUR 110, plus 10% Value Added Tax (VAT), which is EUR 11 – a total of EUR 121.

   This amount is posted to the supplier account, which corresponds to the reconciliation account from the business partner.

   The GR/IR clearing account 21120000 has to be credited with the value from the goods receipt (= EUR 120) because the full quantity that was delivered is invoiced.

   The invoice value (EUR 110) is lower than the goods receipt value (EUR 120). This time, the price difference is posted to price difference account 52541000 as revenue.

   The system posts the tax amount to account 12600000 as input tax.

Posting Keys (PK) define whether a posting is a credit or a debit and to which type of accounts it is posted (supplier/asset...).

In Customizing for Financial Accounting (FI), you can specify the chart of accounts for each company code. For example, the chart of accounts specifies the G/L accounts that are to be used for stock and expense postings. You must set up account determination for each chart of accounts separately because the meaning of individual G/L accounts depends on the chart of accounts.

Automatic Postings Based on Business Processes

In SAP S/4HANA, you post different goods movements using movement types. For example, you post a material issue for production order with movement type 261, a scrapping with 551. For stock differences, the system also determines specific movement types in the background.

To be able to show expenses for production, scrapping or inventory differences separately in financial accounting and cost accounting, you can assign different accounts to the corresponding types of goods issues.

When posting a goods movement, you do not need to enter a G/L account because SAP S/4HANA finds it automatically.

• Organizational level
• Material
• Business transaction

You directly or indirectly specify the plant(s) for the goods movement.

• The company code to which the plant belongs and the chart of accounts for this company code
• The valuation area of the plant and a key (the valuation grouping code) that can be used for differentiated account assignment per valuation area

You specify directly or indirectly the material for which the goods movement is carried out.

• The material type of the material and the indicators showing whether quantity-based and/or value-based updates have been defined for it
• The valuation class of the material, which is responsible for differentiated account assignment, depending on the material and material type

In inventory management, you select a movement type (directly or indirectly) for the goods movement to be posted. The movement type allows you to differentiate between different types of goods movements (for example, goods receipt, goods issue, and transfer posting).

• The specifications for posting to G/L accounts
• The specifications for updating stock and value fields in the material master record

Selecting a process in invoice verification (invoice, credit memo, subsequent debit, or subsequent credit) controls which postings are required for that process. The system also checks whether the quantity that was invoiced or credited is still in stock (stock coverage).

During invoice receipt, for a material that is valuated using the moving average price, the system may post to a price difference account if the invoice price differs from the order price and the invoiced or credited quantity is no longer or only partly in stock.