Below scenarios will help you understand the role of GL tolerance group
Scenario 1
An open item managed GL account is to be cleared e.g. account XYZ
XYZ account line item is posted with debit 100
XYZ account line item is posted with credit 98
We can see there is a difference of 2 (100-98).
Since the difference is small (immaterial), should these two line items be allowed to get cleared with each other. If yes then to which account this difference should be booked?
Different GL tolerance groups are defined using T code OBA0. GL tolerance group is assigned to individual GL account master data.
If tolerance group is left blank then by default these limit are applied to the entire open item managed GL account in the company code.
Scenario 2
For an employee, how much big value transaction he/she can post and how much discount he/she can offer depends on how senior the employee is. An employee at senior level may be authorized to post bigger transaction and give bigger discounts as compared to an employee at junior level.
When payment amount differs from invoice amount, then how much difference is acceptable?
How is the payment difference amount handled depends on whether the difference is immaterial (small) or material (big).
If difference is small then difference amount is treated as cash discount and posted to discount account.
If difference is bigger than discount limit then difference is posted to a different predefined account.
These amount limits are set in employee tolerance group using T code OBA4. Employee is assigned to employee tolerance group.
Scenario 3
Employee is authorized to accept certain payment difference. But allowed payment difference depends not only upon employee’s authority but also on customer/ vendor. Each customer/ vendor is entitled for a certain maximum payment difference. That depends upon customer/ vendor reputation with the organization.
While deciding maximum allowed payment difference, lower of employee authority (employee tolerance) and customer/ vendor tolerance is considered.
Customer / vendor tolerance group is created by using T code OBA3. Tolerance group is maintained in customer/ vendor master data.
So overall there are three types of tolerance groups defined in sap:
These tolerance group play important role at various steps like open item clearing, customer / vendor invoice posting, invoice paymnet.
Example to help you understand role of tolerance group better.
Customer invoiced for 100 but paid only 96.
Whether payment difference of 4 is acceptable or not is decided by checking employee tolerance (assigned to employee) as well as customer tolerance (maintained in customer master).
GL ACCOUNTING
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- What is enterprise structure in sap fico?
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ACCOUNTS PAYABLE
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- Understanding procure to pay (PTP) cycle and accounting document at each step.
- Understanding MM FI integration in very simple terms.
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ACCOUNTS RECEIVABLE
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TAX ACCOUNTING
- How sap helps in tax accounting?
- Tax configuration in sap: Tax procedure, Tax code & Tax jurisdiction code
- Concept of tax jurisdiction code & tax jurisdiction structure
- Significance of “Tax category & Posting without tax allowed” in GL master.
- Tax base amount and Discount base amount
- Assigning tax code V0 & A0 for non taxable transaction?
- Deductible input tax vs non deductible input tax
WITHHOLDING TAX
- Withholding tax in sap explained with example.
- How sap overcomes challenges in managing withholding tax?
- Withholding at the time of invoice or payment
- Withholding tax configuration in sap
- Business place & Section code in sap
- Withholding tax certificate numbering in sap
- Withholding tax report for filling tax returns
ASSET ACCOUNTING
- How sap helps in asset accounting?
- What is meant by asset accounting?
- What is the use of asset class?
- What is the use of depreciation key in asset accounting?
- Depreciation area and Chart of depreciation in sap.
- Derived depreciation area VS real depreciation area?
- Understanding asset accounting configuration needed in sap
- GL account determination for posting asset transaction
- Asset transaction and corresponding accounting document?
- How depreciation is posted in sap?
SAP CONTROLLING