Example: Document Splitting in Realized Exchange Rate Differences 

Use

During document splitting, specific account assignments are transferred from the original process to the subsequent process. Examples of subsequent processes are realization of exchange rate differences and posting cash discounts. For these processes, the system transfers the cause-related account assignments of Controlling relevance to Controlling on the basis of the original document.

Prerequisites

You have specified the cost center as the document splitting characteristic for Controlling (CO). You do this in the Implementation Guide under Financial Accounting (New) ®General Ledger Accounting (New) ® Document Splitting ® Define Document Splitting Characteristics for Controlling.

For more information, see Making Settings for Document Splitting.

Process Flow

This section provides an example of document splitting for realized exchange rate differences. The system also makes the same postings for cash discounts.

1. Initial Situation:

You have entered an invoice of 1000 USD with an exchange rate of 1:1 for USD:EUR. For this, you have assigned two different cost centers appropriate to where costs/revenues were made.

2. Enter payment

At a later date, you pay for this invoice the amount 900 USD with an exchange rate of USD:EUR 1:1.1. You create a residual item for the remaining amount of 100 USD. In this case, realized exchange rate differences occur. When the lines for the realized exchange rate differences are posted, the cost center is taken from the expense lines of the original invoice.

3. Pay residual item

You pay off the residual item completely at a later date, using an exchange rate of EUR:USD 1:1.2. During payment, realized exchange rate differences also occur, which are assigned to the cost center taken from the expense lines of the original invoice.

Example

1: Initial Situation:

Invoice (entry view): USD:EUR = 1:1

Account	Cost center	Segment	Amount in TC (USD)	Amount in LC (EUR)
Vendor1			1000	1000
Expense	CC01	SG01	400	400
Expense	CC02	SG02	600	600

 

Invoice (general ledger view): USD:EUR = 1:1

Account	Cost center	Segment	Amount in TC (USD)	Amount in LC (EUR)
Vendor1		SG01	400-	400-
Vendor1		SG02	600-	600-
Expense	CC01	SG01	400	400
Expense	CC02	SG02	600	600

 

2. Enter payment

Payment (only general ledger view): USD:EUR = 1:1.1

Account	Cost center	Segment	Amount in TC (USD)	Amount in LC (EUR)
Bank		SG01	360-	396-
Bank		SG02	540-	594-
Vendor1		SG01	400	400
Vendor1		SG02	600	600
Residual Items: Vendor1		SG01	40-	44-
Residual Items: Vendor1		SG02	60-	66-
Realized Exchange Rate Difference	CC01	SG01	0	40
Realized Exchange Rate Difference	CC02	SG01	0	60

 

3. Pay residual item

Payment of residual item (only general ledger view): USD:EUR = 1:1.2

Account	Cost center	Segment	Amount in TC (USD)	Amount in LC (EUR)
Bank		SG01	40-	48-
Bank		SG02	60-	72-
Residual Items: Vendor1		SG01	40	44
Residual Items: Vendor1		SG02	60	66
Realized Exchange Rate Difference	CC01	SG01	0	4
Realized Exchange Rate Difference	CC02	SG01	0	6

 

TC = transaction currency

LC = local currency