Starting point (example)
You have a lease-out contract 111 in company code 0001 with the following conditions and payment forms:
Payment form: In arrears
Payment frequency: 3 months
Payment start:01.01.2004
Condition: Basic Rent
Condition amount: 3000 EUR
The cash flow of contract 111 has the following records for the year 2004:
Calculated From - To |
Condition Amount |
1 st due date |
01.01.-31.03.2004 |
3000 |
31.03.2004 |
01.04.-30.06.2004 |
3000 |
30.06.20044 |
01.07.-30.09.2004 |
3000 |
30.09.2004 |
01.10.-31.12.2004 |
3000 |
31.12.2004 |
Transfer of Data to the Accrual Engine and Financial Accounting
You perform a deferral for the amount of 3000 in the cash flow on March 31, 2004. To do so, follow the procedure described in Accruals and Deferrals for Conditions Paid in Advance or Arrears .
The following objects are automatically created in the Accrual Engine:
Accrual object: Contract 111
Accrual subobject:0001/111/1 for the first quarter
(and later for the rest of the year:
0001/111/2 for the second quarter
0001/111/3 for the third quarter
0001/111/4 for the fourth quarter
You can display the accrual subobject 0001/2111/1 for the first quarter (
Display Accrual/Deferral Results
). The following accruals were calculated for this object (periodic revenue recognition):
Condition |
Calculated From - To |
Accrual/Deferral Amount |
Cumulative Amount |
Key Date |
Basic Rent |
01.01.-31.01.2004 |
1000 |
0 |
31.03.2004 |
Basic Rent |
01.01.-31.02.2004 |
1000 |
1000 |
31.03.2004 |
Basic Rent |
01.01.-31.03.2004 |
1000 |
2000 |
31.03.2004 |
On the
Postings
tab page, you can display the postings for the key date March 31, 2004:
Record type |
Calculated From - To |
Condition Amount |
Key Date |
Periodic revenue recognition |
01.01.-31.01.2004 |
1000 |
31.03.2004 |
Periodic revenue recognition |
01.02.-28.02.2004 |
1000 |
31.03.2004 |
Periodic revenue recognition |
01.03.-31.03.2004 |
1000 |
31.03.2004 |
Closing posting in the Accrual Engine |
01.01.-31.03.2004 |
3000 |
31.03.2004 |
For the April 1, 2004 key date, the system would also create an additional item for the first periodic revenue recognition for the first period of the second quarter.
Determination of Accrual/Deferral Amount
The accrual/deferral posting (based on the key date) determines if:
There are flow records for which a debit positionhas already been posted
The date of the
calculation to
is after the key date
The accrual/deferral run enters accrual/deferral flows for these flow records for the period from the
calculation from
(of the posting) to the
key date
(of the accrual/deferral run) in the
cash flowand then the system posts them.
Posting specifications
You enter the accounts for each accrual type in Customizing. When the accrual/deferral is run, then the records are posted based on this outline:
credit x, debit y Credit ( posting key) account, debit (posting key) account (amount) |
||
Accrual amount January |
(40)
|
(50)
|
Accrual/Deferral February |
(40)
|
(50)
|
March: Accrual/Deferral Amount Closing entry |
(40)
(40)
|
(50)
(50)
|
Periodic posting March |
(01)
|
(50)
|
Result: Each posting period has a balance of 1000 revenue. |
Note
For more information on deferrals , refer to Example: Deferral of Rent Paid in Advance .