# Set Tolerance
Limits

In this step, you specify the tolerance limits
for each tolerance key for each company code.

When processing an invoice, the R/3 System
checks each item for variances between the invoice and the purchase order or
goods receipt. The different types of variances are defined in tolerance
keys.

The system uses the following tolerance keys to
check for variances:

**AN: Amount for item without order
reference**

If you activate the
item amount check, the system checks every line item in an invoice with no
order reference against the absolute upper limit defined.

**AP: Amount for item with order
reference**

If you activate the
item amount check, the system checks specific line items in an invoice with
order reference against the absolute upper limit defined. Which invoice items
are checked depends on how you configure the item amount check.

**BD: Form small differences
automatically**

The system checks
the balance of the invoice against the absolute upper limit defined. If the
upper limit is not exceeded, the system automatically creates a posting line
called Expense/Income from Small Differences, making the balance zero and
allowing the system to post the document.

**BR: Percentage OPUn variance (IR
before GR)**

The system
calculates the percentage variance between the following ratios: quantity
invoiced in order price quantity units : quantity invoiced in order units and
quantity ordered in order price quantity units : quantity ordered in order
units. The system compares the variance with the upper and lower percentage
tolerance limits.

**BW: Percentage OPUn variance (GR
before IR)**

The system
calculates the percentage variance between the following ratios: quantity
invoiced in order price quantity units: quantity invoiced in order units and
goods receipt quantity in order price quantity units : goods receipt quantity
in order units. The system compares the variance with the upper and lower
percentage limits defined.

**DQ: Exceed amount: quantity
variance**

If a goods receipt
has been defined for an order item and a goods receipt has already been
posted, the system multiplies the net order price by (quantity invoiced -
(total quantity delivered - total quantity invoiced)).

If no goods receipt
has been defined, the system multiplies the net order price by (quantity
invoiced - (quantity ordered - total quantity invoiced)).

The system compares
the outcome with the absolute upper and lower limits defined.

This allows
relatively high quantity variances for invoice items for small amounts, but
only small quantity variances for invoice items for larger
amounts.

You can also
configure percentage limits for the quantity variance check. In this case, the
system calculates the percentage variance from the expected quantity,
irrespective of the order price, and compares the outcome with the percentage
limits configured.

The system also
carries out a quantity variance check for planned delivery costs.

**DW: Quantity variance when GR quantity
= zero**

If a goods receipt
is defined for an order item but none has as yet been posted, the system
multiplies the net order price by (quantity invoiced + total quantity invoiced
so far).

The system then
compares the outcome with the absolute upper tolerance limit
defined.

If you have not
maintained tolerance key **DW** for your company code, the system
blocks an invoice for which no goods receipt has been posted yet. If you want
to prevent this block, then set the tolerance limits for your company code for
tolerance key **BW ** to *Do not
check*.

**KW: Variance from condition
value**

The system
calculates the amount by which each delivery costs item varies from the
product of quantity invoiced * planned delivery costs/ planned quantity. It
compares the variance with the upper and lower limits defined (absolute limits
and percentage limits).

**LA: Amount of blanket purchase
order**

The system
calculates the sum of the value invoiced so far for the order item and the
value of the current invoice and compares it with the value limit of the
purchase order. It then compares the difference with the upper percentage and
absolute tolerances defined.

**LD: Blanket purchase order time limit
exceeded**

The system
determines the number of days by which the invoice is outside the planned time
interval. If the posting date of the invoice is before the validity period,
the system calculates the number of days between the posting date and the
start of the validity period. If the posting date of the invoice is after the
validity period, the system calculates the number of days between the posting
date and the end of the validity period. The system compares the number of
days with the with the absolute upper limit defined.

The system
determines by how much each invoice item varies from the product of quantity
invoiced * order price. It then compares the variance with the upper and lower
limits defined (absolute limits and percentage limits).

When posting a
subsequent debit/credit, the system first checks if a price check has been
defined for subsequent debits/credits. If so, the system calculates the
difference between (value of subsequent debit/credit + value invoiced so far)
/ quantity invoiced so far * quantity to be debited/credited and the product
of the quantity to be debited/credited * order price and compares this with
the upper and lower tolerance limits (absolute limits and percentage
limits).

**PS: Price variance: estimated
price**

If the price in an
order item is marked as an estimated price, for this item, the system
calculates the difference between the invoice value and the product of
quantity invoiced * order price and compares the variance with the upper and
lower tolerance limits defined (absolute limits and percentage
limits).

When posting a
subsequent debit/credit, the system first checks whether a price check has
been defined for subsequent debits/credits, If so, the system calculates the
difference between (value of subsequent debit/credit + value invoiced so far)
/ quantity invoiced so far * quantity to be debited/credited and the product
quantity to be debited/credited * order price. It then compares the variance
with the upper and lower tolerance limits defined (absolute limits and
percentage limits).

**ST: Date variance (value x
days)**

The system
calculates for each item the product of amount * (scheduled delivery date -
date invoice entered) and compares this product with the absolute upper limit
defined. This allows relatively high schedule variances for invoice items for
small amounts, but only small schedule variances for invoice items for large
amounts.

**VP: Moving average price
variance**

When a stock posting
line is created as a result of an invoice item, the system calculates the new
moving average price that results from the posting. It compares the percentage
variance of the new moving average price to the old price using the percentage
tolerance limits defined.

Variances are allowed within predefined
tolerance limits. If a variance exceeds a tolerance limit, however, the system
issues a message informing the user. If an upper limit (except with BD and VP)
is exceeded, the invoice is blocked for payment when you post it. You must
then release the invoice in a separate step. If the tolerance limit for BD is
breached, the system cannot post the invoice.

**Note that** if you set all
limits for a tolerance key to *Do not check* , the
system does not check that tolerance limit. Therefore any variance would be
accepted. This does not make sense particularly in the case of the tolerance
key **Form small differences automatically**.

###
Activities

Configure the tolerance limits for the
individual tolerance keys.

Lower limit Upper limit

Absolute Percentage Absolute
Percentage

AN - - X -

AP - - X -

BD X - X -

BR - X - X

BW - X - X

DQ - - X -

DW - - X -

KW X X X X

LA - - X X

LD X - X -

PP X X X X

PS X X X X

ST - - X -

VP - X - X