Global Inc. has implemented several clearing processes to keep track of certain business operations that are interrelated. For example, every payment issued to a vendor will be cleared against the correspondent disbursement reflected on the bank statement. To support this business case, Jill needs to review the process of clearing documents in SAP, focusing on the manual process.
SAP S/4HANA always manages customer and vendor accounts on an open item basis. This means that customer and vendor postings (invoices) are considered as open (incomplete) until they are cleared against a matching document, typically a payment.
For G/L accounts, however, the administrator has to set the open item management option in their master record. This will enable an easier reporting of open items (incomplete versus completed items).
For example, payments to vendors made by check will be considered as open items in a bank checks clearing account until the check is cashed and the bank statement journal entry transforms the open item into a cleared item.
During clearing, the system also enters a clearing document number and the clearing date in these items. In this way, invoices in a vendor account are indicated as paid, and items in a bank clearing account are indicated as cleared.
Open item management is recommended for the following G/L accounts:
- Bank clearing accounts
- Goods receipt /invoice receipt
- Payroll clearing accounts
Most of the clearing operations can be automated in a clearing program that can be adapted by the administrator to the individual requirements of each company.
However, if clearing has to be processed manually by the user, some basic principles need to be taken into account:
There are two different ways to perform manual account clearing:
- Account clearing: The debit and credit postings are already present in the account. They are matched subsequently by a new clearing document.
- Posting with clearing: During document entry, the user enters the document amount and selects existing open items that require clearing. If the total amount of the selected open items equals the amount of the clearing document, SAP S/4HANA clears the open items by creating one or more clearing items. If the total amount of selected open items does not equal the amount of the clearing document, the system allows you to post the difference. Now let’s explain the principles of clearing.