Determination of Basis for Comparison (SAP Library - Balance Sheet Valuation (MM-IM-VP))

Determination of Basis for Comparison

Use

When you use the LIFO valuation method, you compare the stocks at a particular point in time with the total of the layer quantities. In the R/3 System, you can define the following periods under review.

Features

The stock at the end of the previous fiscal year is compared with the total quantities in the existing layers (GJE). This is the usual option chosen for LIFO valuation based on annual layers.

The stock at the end of the previous period is compared with the total quantities in the existing layers (VOM). This is the usual option chosen for LIFO valuation based on monthly layers, but you can use in combination with annual layers, for example for internal stocktaking purposes (see Layer Versions).

The stock at the end of the period before last is compared with the total quantities in the existing layers (VVM). This option can be used for LIFO valuation based on monthly layers, if you can only run valuation with some delay after the end of a posting period for certain reasons. For annual layers, the same applies as for the VOM option.

The current stock is compared with the total quantities in the existing layers (CUR). You can use this option if LIFO valuation is not linked to specific posting periods or if you run it shortly before the end of a posting period.

Once you have selected a suitable basis for comparison for your application, you can assign this to one of the LIFO methods (see LIFO Methods) in Customizing or from the selection screen before running one of the LIFO valuation programs. All you need to do in the following steps involving LIFO is enter the LIFO method.