Example 3: Reclassification of Sales Revenue
Initial Situation
If sales revenue results from sales to partner units, from the group's perspective, these need to be reclassified into other capitalized goods on own account when using period accounting.
Note
Note that interunit profit/loss is not eliminated in the process. In this respect, the reclassification is a simplified form of the elimination of interunit profit/loss in noncurrent assets.
The system posts the reclassification entry with posting level 20.
In our example, consolidation unit A supplied consolidation unit B with equipment for 100 currency units.
Sample Data
Consolidation Unit
| Item | Transaction Type | Partner Unit
| Value |
|---|---|---|---|---|
B | 10320200 (Machinery & Equipment) | 125 (additions) | A | 100 |
A | 30110200 (Sales Revenue, Gross Revenue of Affiliates) | B | 100- |
Prerequisites
In this example, we use the chart of accounts, which provides for the appropriation of retained earnings in the balance sheet and period accounting.
In the consolidation monitor, you have completed the data entry, the standardization of the reported data, and the currency translation.
Process Flow
A. Customizing
Define Document Type and Task
Define a document type with posting level 20 (two-sided elimination entries).
Define a task for the reclassification.
Define Method Layout
Create a method layout for the reclassification, or use an existing layout with the following properties:
Without percentage
Without condition
With source
Since trigger (Machinery & Equipment) and source (Other Capitalized Goods on Own Account) differ
Without substeps
Define in ... | Trigger | Source | Target |
|---|---|---|---|
... the Method | |||
Visibility | ¯ | ¯ | ¯ |
Detail screen | Consol. Unit Item | Item |
You also need the characteristics
Consolidation Unit
andItem
for Source and Target. However, you do not necessarily need to specify these again since they are inherited from Trigger to Source and Target.Since you do not need the characteristics
Transaction Type
andPartner Unit
for all components of the reclassification, only select these when defining the methods as required (see below).
Define Method
Create a method with the following characteristics:
Trigger:
Type of Trigger Data:
Transaction Data:
Periodic (since the reclassification is to be performed in each consolidation period and only the difference to each previous period interval is to be posted)
Key figure : Total in group currency
Trigger data:
Characteristics | Trigger | |
|---|---|---|
Consolidation Unit | = | B |
Item | = | 10320200 (Machinery & Equipment) |
Transaction Type | = | 125 (additions) |
Partner Unit | = | A |
Source:
Note
From an accounting perspective, Sales Revenue should be the source, and Other Capitalized Goods on Own Account should be the target. However, the source and target must be switched around because of the debit/credit signs of the two accounting items.
Characteristics | Source | |
|---|---|---|
Consolidation Unit | = | A |
Item | = | 30300000 (Other Capitalized Goods on Own Account) |
Target:
Characteristics | Target | |
|---|---|---|
Consolidation Unit | = | A |
Item | = | 30110200 (Sales Revenue, Gross Revenue of Affiliates) |
For the reclassification rule, you specify that the posting is to be performed for the partner unit.
Assign Document Type and Task
Assign the document type and the method to the reclassification task.
B. Execute Task
Execute the reclassification task in the consolidation monitor.
The system posts the following:
Consolidation Unit
| Item | Trans. Type
| Partner Unit
| Value |
|---|---|---|---|---|
A | 30300000 (Other Capitalized Goods on Own Account) | -- | B | 100- |
A | 30110200 (Sales Revenue, Gross Revenue of Affiliates) | -- | B | 100 |
Result
After the reclassification has been performed, the sales revenue is reclassified into other capitalized goods on own account.