Explanation of General Ledger Fields

Fields  that appear on the GL account company code segment are explained below:
Account currency: account currency is the currency in which account is managed.
This field should be filled with company code currency. By doing so, the account allows to post entries in any other currency in that account. If at any case, any other currency is used apart from company code currency,  the posting is restricted to that currency only.

Asset accounting : Briefing

Asset Accounting

 

Like AP and AR, Asset Accounting  is the subsidiary ledger of Financial Accounting. The appropriate general ledger are updated each time we post. There are various accounts maintained on Fixed Asset like Appreciation and Depreciation, Asset purchasing, Asset Selling , Scrapping, Transfer of Asset etc 

Procurement of services without Purchase order(related to GST)

This process is related to passing of invoices in the Finance module where the Material Management department is not involved. Invoices that will be routed through FI include insurance and other miscellaneous services.

·         These invoices will be passed through the T-code F-43 or FB60.

·         The Finance department will verify the document and update the Payables a/c that is, creating a liability. Finance will process the payment through the automatic payment program.

·         In GST regime, while booking such expenses where PO is not created, depending on the type of expenses, SAC / HSN code should be given in the input screen. For every transaction business place has to be captured, apart from business place below objects should also be captured in input screen.

Ø  GST Partner: Vendor code with whom purchase transaction is made. This is required to capture the vendor GSTIN.

Ø  Place of Supply: This is the place where actual supply of service is taken place.

Ø  Tax Code: This is required to calculate tax automatically and post into relevant GL accounts.

Ø  All the above fields will be made mandatory in FB 60 transaction code.

 

Flow of Entries:

 

Accounting entry in case of Intrastate:

 

CGST Input A/c   Dr

Expense A/c           Dr

SGST Input A/c                  Cr

 Vendor A/C                                      Cr 

  

Accounting entry in case of Interstate:

 

IGST Input Credit                              Dr

Expense A/c                                       Dr

Vendor A/c                                        Cr

Exchange Rate and Translation Ratio

This article describes the posting of invoices  in multiple currencies for the same entity. The system need customization and configuration of the conversion rate and translation ratio of currency in SAP .

Before that we need to understand about Exchange rate type. We can define exchange rate for each currency pair. The exchange rate can be differentiated through different exchange rate type.

The exchange rate type is defined in Customization under General Settings ->Currencies->Check Exchange rate types

The following exchange rate types exist

·         Buying Rate

·         Bank Selling Rate

·         Average Rate

·         Historical Exchange Rate

·         Key Date Exchange Rate

The system normally uses exchange rate type (M) average rate.

Further to this, we need to understand more about Translation Ratio. The translation ration between two currencies means how a currency can be related with each other.

SAP normally recommends 1:1 ration for each currency pair. However, in some cases, SAP has inherent round off difficulties. This generally happen when one of the currency is strong and stable and other is too weak owing to the inflationary trends and other factors prevailing in the country. 

Exchange Rates are used to maintain the relationship between two currencies and to translate an amount into other currency. It is defined at client level and therefore applies for all company codes.

Exchange rates are defined for following purposes

·         Posting and Clearing

·         Exchange Rate Differences

·         Foreign Currency Valuation

Define Translation ratios

IMG: SAP NetWeaver ->General Settings -> Currencies -> Define Translation Ratios for Currency Translation Transaction: OBBS Table: TCURF

To enable an entity, post invoices in multiple currency, after translation ratio, exchange rates need to be maintained It is very important to lock the table entries during exchange rate maintenance as per basic database design principles to avoid any data record access during update.

Exchange rates are used to find the value of a given currency with respect to other currency.      

Define Exchange rate

IMG: General Settings -> Currencies -> General Settings -> Currencies -> Enter Exchange Rate Transaction: OB08 Table: TCURR

After all these necessary configuration, we are able to receive or post invoices with Multiple currency