For sure you have already heard about the SAP S/4HANA Accruals Management?
The Accrual Management now offers a new functionality to handle deferrals as of S4 HANA OP 2021. Prepayment processing has until far been a routine and manual task for Finance users. Finance can increase productivity with the use of this new functionality, and it’s also relatively simple to apply. Additionally, even if you haven’t yet implemented the accruals section, you can still use the deferrals portion.
To make this process as efficient as possible, I’ll demonstrate how to configure the SAP S/4HANA Accruals Management for deferrals in this article.
The customizing for the deferrals is actually not very cumbersome.
You can access the Accruals Management customizing over transaction code “ACEIMG”.
First, we must complete the basic customization in the “Basic Settings” area, where we specify things like which Company Codes are pertinent or which Accrual Item Types need to be set.
The Accrual Item Types delivered in Standard should already be quite helpful.
Same is valid for the Accrual Methods that are defined in the section “Accrual Calculation”:
Figure 1: Customizing of the Accruals Management
In our case we use the Standard Accrual Method “PLN-REC” to calculate the deferrals.
For the recognised costs, we use “DCSTLT” for linear cases based on the Purchase Order life time (for example, rent prepayments where we pay one year in advance, every month the same amount), and “DCSTPC” for cases based on the delivery schedule (for example, prepayment for engineering services for materials that are based on a specific delivery schedule):
Figure 2: Customizing Accrual Methods
Custom Accrual Methods can also be made, although this requires coding knowledge.
The “Review and Approval of Accruals” section might also be changed if it were genuinely necessary. However, since we only publish deferrals in our situation, this might not make as much sense since the amounts should not be adjusted during the review. As we will see later in this blog, it is preferable to guarantee the accuracy of the purchasing documents.
As previously noted, in our scenario, we want to use the Accruals Management just for posting deferrals. If so, all we need to do is make sure that postings are only generated for Accrual Item Types that apply to deferrals.
This can be defined in the section “Accrual Postings”:
Figure 3: Customizing of Accrual Postings
In this case, we can specify a Posting Scheme for the pertinent Accrual Item Types, which entails merely designating accounts to the relevant Transaction Type / Posting Scheme.
Only the invoice postings / opening postings and the periodic postings are significant in our scenario for deferrals without accruals:
Figure 4: Customizing of Posting Schema
The final step is to describe the purchase order transfer in the accruals engine because we want the accruals objects to be generated and computed automatically from the purchase orders.
This customizing you find in the section “Purchase Order Accruals”.
We define a Purchase Order Transfer Variant and assign a Company Code to it:
Figure 5: Assignment of PO Transfer Variant to a Company Code
Following that, we specify the calculation techniques to be applied, that is, the Accrual Item Types and Accrual Methods to be applied for this Transfer Variant:
Figure 6: Customizing of PO Transfer Variant
This is actually a very crucial step in the setup process since we need to determine which use cases are necessary, how to set them up as a purchasing document, and which different accrual methods these use cases call for.
In the aforementioned example use cases, prepayment for rent would be made using the method “DCSTLT” for a linear distribution, and prepayment for engineering services for materials would be made using the accrual method “DCSTPC” for a distribution based on delivery schedule.
We must be able to differentiate the pertinent Purchase Orders in accordance with the various Accrual Methods we require. Three criteria are available for this: the kind of purchasing document, the category of the item, and the classification of accruals.
In our example, this means that the purchase orders for rentals must contain either a different item category or an accruals classification because the purchasing document type is the same as for engineering services. In our scenario, we opted for a different Accruals Classification (“SPERP” rather than “SDELS”) that is triggered by the Product Type Group in the Purchase Order. This Product Type Group is classed as a service and given the Accruals Classification (“SPERP”) since rents have a value of “2”.
As a result, the project must thoroughly evaluate the required use case and purchasing document combinations. The business end users must then make sure that the Purchase Orders are configured correctly in order for the deferrals computation to be accurate. In the beginning of the use of deferrals calculations, this should be tested and then checked on a regular basis.
Once this initial setup is done, you can run following transaction to test and verify your deferral calculations:
Figure 7: Transactions to run the Accruals Management
As a result, and if everything is configured properly, you will discover that the deferrals are posted accurately and automatically.
Let’s keep learning together.