Retroactive Accounting for Summary Clearing
Use
If an employee changes company code and, for example, after the change receives a backdated pay increase which also affects the time before the change, receivables and payables incur between the two company codes.
Although the relevant expenses wage type changes for the period for which retroactive accounting is run, the amount to be paid to the employee remains the same. The payment amount firstly changes in the current period so that the system transfers the payments that the old company code must make because of the backdated pay increase from the new company code.
In this way, receivables and payables incur between the company codes that appear as balances on the recalculation difference account.
The graphic shows the case where an employee changes from company code 0001 to company code 0003 at the start of period 02. In period 02, his/her monthly salary is increased by 1.000 for period 01.
In period 01, the employee receives a monthly salary of 5,000 (wage type M020). This amount is also paid to the employee (wage type /559) as no other payments and deductions are taken into account in this example.
In period 02, the employee gets a monthly salary of 6,000 for period 02 (wage type M020) as well as a backdated pay increase of 1,000 for period 01.
In this way, expenses of 1,000 incur in company code 0001. The payment amount is not increased retrospectively for period 01, but is transferred to the current period using the wage types
/551 Recalculation difference
and
/552 Subsequent clearing from previous period
instead. The expense of 1,000 in company code is thus offset by a recalculation difference of 1,000 that is posted to the credit side of the recalculation difference account.
A payment amount of 7,000 incurs for the current period in company code 0003; this amount is made up of the increased salary of 6,000 and the subsequent clearing of 1,000 from the previous month. This amount is posted to the
Payment
account in credit. This is offset by an expense of 6,000 that is posted to the debit side of the
Remuneration
account, as well as a recalculation difference of 1,000 that is posted in the debit side of the recalculation difference account for company code 0003.
Consequently, the recalculation difference accounts are not cleared in both company codes.
The balance of the recalculation difference account for company code 0001 shows a payable of 1.000 from company code 0003.
The balance of the document-split account for company code 0003 shows a receivable of 1.000 from company code 0001.
Note
If, in Payroll Customizing under Reporting for Posting Payroll Results to Accounting -> Activities in HR System -> Employee Grouping and Symbolic Accounts ->Define Symbolic Accounts, you code the symbolic account to which the wage types /551 Recalculation difference and /552 Subsequent clearing from previous period are assigned with the account assignment type FL Balance sheet account for checking the balance in the case of retroactive accounting data, the balance incurs on the document split account instead.
Activities
The balances of the recalculation difference accounts correspond to the receivables and payables between the company codes.
You must manually clear the receivables and payables between the company codes. When doing so, you also clear the balances of the recalculation difference accounts.