Posting Levels for Classifying Journal Entries 

Definition

Posting levels classify journal entries in the consolidation system.

Posting levels distinguish between the following types of entries:

·         Adjustments to reported financial data

·         Standardizing entries

·         Entries for interunit elimination and the elimination of interunit profit/loss in transferred inventory

·         Consolidation of investments entries

Reported financial data also has a separate posting level.

Use

A document type is typically assigned to journal entries. The document type determines the posting level of the entry. (When collecting reported financial data, the system uses its own posting level; however, it does not post any documents.)

The system records the posting level in the totals record and the journal entries.

Classifying entries with posting levels helps you in selecting data, and is also utilized by the system:

·         By specifying posting levels when selecting data, you can evaluate individual portions of the consolidation process in your consolidation reports.

You can evaluate the standardized financial data of a consolidation unit by selecting the data with posting levels 00, 01, and 10 for this unit.

·         The system uses the posting level:

-         For internal consistency checks of the data

-         For the selection of data to be processed

For interunit elimination, the system selects all data (of the consolidation units to be eliminated) with posting levels less than or equal to 20.

Structure

The available posting levels are predefined in the system. The following posting levels are available:

Posting Level	Use
00	Reported financial data
01	Adjustments to reported financial data
10	Standardizing entries
20	Two-sided elimination entries
30	Consolidation of investments entries

Explanations

Reported financial data (00)

Posting level 00 is assigned to reported financial data; but no document is posted.

·         Adjustments to reported financial data (01)

If, after collecting the reported data of the consolidation units, you want to make changes to the data at corporate headquarters, we recommend doing this by posting adjustment entries with posting level 01. This has the benefit that your changes are documented.

·         Standardizing entries (10)

You may need to standardize the reported data of consolidation units to comply with corporate policies or corporate valuation rules.

In the data records with posting levels less than or equal to 10, the system posts only to the consolidation unit – not to the consolidation group. Reporting takes into account the data records for all consolidation groups.

·         Two-sided elimination entries (20)

Interunit elimination, the elimination of interunit profit/loss in inventory, and reclassification are examples of two-sided elimination entries. Here, the consolidation unit as well as the partner unit are assigned in the data records.

Reporting takes into account the data records for all consolidation groups in which both the consolidation unit and the partner unit are posted.

·         Consolidation of investments entries (30)

In consolidation of investment postings, the consolidation unit, partner unit, and consolidation group are assigned to data records. Reporting only considers the data records with the assigned consolidation group and the higher-level consolidation groups.