Prerequisite for reports about business areas is, that all FS items of financial statements and income statements, for which the business area has responsibility, are to be supplied with the business area account assignment. This is in particular the FS items of the transferred assets, the receivables and payables, the material stocks, as well as all FS items of the income statement.

In addition to that for business area consolidations, it is necessary that the postings, which originate from group-internal business relationships, are supplied with the trading partner business area.

Therefore the operational postings to the accounts which are relevant for business areas, have to contain business area account assignments and trading partner account assignments.

It depends on the business transaction, how the business area is assigned in the operational postings. Fundamentally there are two possibilities: The system can either derive the business area automatically from master records of the concerned account assignment objects, or the administrator has to enter the business area manually.

As with assigning the business area, it depends on the business transaction, as to how the trading partner business area is assigned. Fundamentally there are two possibilities: The system can either set the trading partner business area "diagonally", or the administrator has to enter the trading partner business area manually.

With the business transactions of materials procurement and sales, the system can automatically derive the trading partner business area. Prerequisite for this is that the delivering and receiving partner set the SAP components Materials Management and Sales in the same SAP System and in the same client.

Process Flow:

• You enter a purchase order in Materials Management. In the MM document you assign the business area, for which you are ordering the material. From the purchase order, the system generates a sales order. In the SD document the business area is assigned, from which the material is delivered.
• General ledger relevant documents are created for goods issue (SD) and goods receipt (MM). The system sets the trading partner business area "diagonally" in the documents.

• In the goods issue document the system assigns the trading partner business area, which it derives from the purchase order.
• In the goods receipt document the system assigns the trading partner business area, which it derives from the supplier data.

• Subsequently issue receipt (SD) and invoice receipt (MM) are posted. The payment transaction is processed in the vendor / customer invoice.

In the IMG the companies have to identify the same clients to enable the automatic derivation of the trading partner business area.

When you enter in accounts receivable/payable accounting, then you enter the trading partner business area in the document header or in the G/L account. The trading partner business area is not passed on to the current line (also not when it is clear in the document). Therefore it must be readjusted to the reconciliation account Receivables or Payables (see below).

To enter the trading partner business area, the administrator must have the information which business area is concerned with the group-internal business partner. You have to organize this flow of information.

The adjustment of business areas is always necessary when you want to create a business area balance sheet / income statement in financial accounting. In addition to that it is also necessary for business area consolidations.

You execute the adjustment in the G/L accounting (menu Periodic Work) in fact for the following reasons:

• When posting a document, not all document line items are supplied with the business area. The document line items are not supplied for the following accounts:

• Reconciliation accounts for receivables and payables (when the business area is not clearly in the document)
• Tax accounts
• Cash discount accounts
• Accounts for exchange rate differences

• The adjustment program makes sure that the entire balance is null, per business area. The program creates the corresponding elimination postings.

The following example explains the adjustment of business areas to the reconciliation accounts Receivables, with the help of a simple posting example. Tax postings are disregarded.

A customer invoice is created in which the sales revenue is assigned to a business area.

As the business area is clear in the document, the system can pass on the business area account assignment from the G/L account line to the current line and with it to the reconciliation account Receivables. Therefore no adjustment is necessary for this posting.

A customer invoice is created in which the sales revenue is assigned to several business areas.

The system does not pass on the business area to the current line. Otherwise the customer posting would be excessively large. It is important that the receivable is divided into the business areas. You achieve this with the adjustment program.

The adjustment program writes off the amount of 1,000.00 to the adjustment account for the receivable without the business area account assignment and with stock allocation to the business areas again.

When you have activated the data transfer for business area consolidation in Customizing, then the adjustment program also assigns the trading partner business area to the accounts to be adjusted.

As the business area is clear in the document, the system passes it on from the G/L account line to the current line and with it to the reconciliation account Receivables. However the system does not generally pass on the business area to the current line. Therefore the trading partner business area must also be adjusted.

The adjustment program writes off the amount of 1,000.00 to the adjustment account for the receivable without the business area account assignment and with the business areas again.

The execution of the adjustment is not the Consolidation administrator’s responsibility, instead it is the responsibility of the G/L accounting.

However as the person responsible for the data transfer to Consolidation, you should check whether the adjustment program was executed, so that the data, which you transfer to Consolidation, had the necessary business area account assignments.