Inflation Adjustment of Open Items in Local Currency (SAP Library - FI Accounts Receivable and Accounts Payable)

Inflation Adjustment of Open Items in Local Currency

Use

Using the SAP System, you can adjust open items, that is, payables and receivables, for inflation. The system does this by creating a new open item on the customer or vendor account for the net inflation rate.

Example

You adjust an open customer invoice worth UNI 4,000 for inflation, which is running at 10%. The system creates a new customer invoice for UNI 400 in addition to the existing invoice.

There are two separate programs, one for open receivables and one for open payables.

Features

Business Practice

This program is based on the following business practice: During periods of high inflation, customers and vendors sometimes come to individual agreements about how to adjust outstanding invoices for inflation. Inflation accounting laws do not usually provide for the blanket adjustment of open items. For this reason, once an agreement has been made, we recommend that you enter an inflation index in the appropriate line item; by default, the program only adjusts open items that you have assigned an inflation index to individually, although you can override this.

Accessing the Programs

To access the receivables program, from the SAP Easy Access screen, choose Accounting → Financial Accounting → Accounts Receivable → Periodic Processing → Closing → Valuate → Inflation Adjustment of Open Receivables in Local Currency.

To access the payables program, from the SAP Easy Access screen, choose Accounting → Financial Accounting → Accounts Payable → Periodic Processing → Closing → Valuate → Inflation Adjustment of Open Payables in Local Currency.

Selection

On the selection screen, you specify:

Which customers or vendors you want to adjust the open items for
The parameters for the inflation adjustment documents (required in update mode only)

Output

The system:

Calculates the inflation on each open item

It calculates the inflation as from the item's last adjustment date (or its posting date, if it has not been adjusted before). If you use the Extended Withholding Tax solution, it also calculates withholding taxes.

Calculates the appropriate taxes on sales and purchases, if you have specified so on the selection screen

Creates and posts a separate inflation adjustment document for each document adjusted (update mode only)

These documents are similar to those created by the Inflation Adjustment of G/L Accounts program, except for the following:

Parallel currencies

These documents contain amounts in any parallel currencies.

Document number of original open item

The original open item's document number is stored in the vendor or customer line item text field.

Inflation index

The system assigns the same inflation index to the inflation accounting document that it used to adjust the original open item.