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 Service Charge Settlement

Purpose

You use service charge settlement to distribute apportionable costs that arise during a particular settlement period to the tenants.

Process Flow

Below is a description of the processes involved in service charge settlement.

I.Master Data for Settlement Unit, Rental Object, and Contract

  1. Enter measurements in each participating usage object.

  2. Assign the usage objects to a participation group for each business entity.

  3. Create a settlement unit for each service charge key, and assign the rental objects participating in the settlement to this settlement unit using the participation group.

    If costs for more than one settlement unit were jointly invoiced, you must create a master settlement unit.

  4. The settlement participation is automatically generated for each contract. However you can define exceptions in each contract.

II.Incoming Invoice Posting

Account assignment of service charges is made to the respective settlement units or master settlement units in the Financial Accounting (FI) component. The settlement amount is transferred automatically to the correct settlement period by means of the settlement reference date.

For postings with extended withholding tax , only advance payments posted as revenue are considered for the conditions relevant for service charges. The system does not support special general ledger processes with withholding tax. The standard withholding tax term is often used during service charge settlement. You can determine the term from the conditions only in the Transfer Posting Advance Payments Debit Balance settlement mode.

III.Execute Service Charge Settlement

Execute the service charge settlement run at the end of the settlement period:

  • Advance payments are transferred in a batch input session.

  • There are several steps involved in the settlement. You can save each step (except posting) and call it again.

  • The results of settlement can be posted directly to Financial Accounting.

For more information on performing service charge settlement, refer to Simulating and Executing Service Charge Settlement .

Result

Depending on how you set it up, the service charge settlement performs the following activities:

  1. Calculation of total costs for the settlement period for each service charge key

  2. Cost apportionment to the relevant contracts or rental objects

  3. Posting of cost shares to tenant accounts

  4. Determination of the advance payments (actual payments) made by the tenant for which credit transfer postings are made