CO FI Reconciliation in SAP new GL Overview

CO to FI reconciliation is one of the significant process improvements in SAP new GL. Cross company code postings in Controlling ledger is the main ca se of difference !etween FI ledger and CO ledger. If sers post cross company code in CO ledger" the corresponding #legal$ effect %i.e. cross company !illing and acco nting& of this transaction does not reflect in FI. Previo sly" sers had to process a 'o! at month end to allow the system to reconcile the differences and post corresponding entries in FI ledger. (ith new GL" this reconciliation and posting of entry in FI ledger occ rs real time. (e will se a cross company allocation e)ample to e)amine how new GL reconciles CO Ledger with FI Ledger.

CO FI Ledger Reconciliation
When allocations are made within Controlling, they might post to two cost objects or two cost centres that belong to different company codes. In legal terms, one company code has charged cost to another company code. Since this allocation occurs in Controlling, the legal impact of cross company allocation is required to be reflected in Financial Accounting.

Cross company code allocation in Controlling

With pre ious ersions of SA!, business users are required to e"ecute a period end job to reflect this posting in Financial Accounting. With new #$, SA! posts documents in Financial Accounting simultaneously with the cross company allocation posting in Controlling. %he ob ious ad antage of this is faster period end close because users do not ha e to e"ecute the period end job to reconcile the ledgers. &ew #$ ensures integrity of data between the two ledgers is maintained throughout.

C' FI (econciliation postings in FI $edgers

(hat am I demonstrating*
I will demonstrate how new #$ handles C'FI reconciliation. As an e"ample, I will process a cross company code cost centre allocation in Controlling. %his posting should generate a real) time cross)company posting in Financial Accounting.

Ass mptions for this !log

'ne of the pre)requisites is that SA! new #$ is acti e. It is not essential to ha e document splitting acti e* for the purpose of this blog document splitting is acti e. All configuration steps documented in blog +SA! deli ered pre)configuration for document splitting in SA! new #$, are configured for the demonstration in this blog. !rofit Centre -.// is assigned only to Company Code 0//- and !rofit Centre 1//- is assigned only to Company Code 0//1. I will demonstrate C'FI (eal)%ime Integration for a cross)company code posting. %he similar logic and configuration step applies to cross profit centre, cross functional area, or any of the other new #$ scenario.

For the purposes of demonstration, I will perform a cross)profit centre assessment. 2owe er, the logic and the process described in this blog will wor3 for all processes that post cross)company code eg. distribution, acti ity allocation, manual repostings etc

SAP new GL design driving COFI Reconciliation

%he below configuration has to be done to enable C'FI reconciliation.

Define Variants for Real-Time Integration Assign Variants for Real-Time Integration to Company Codes Define Account Determination for Real-Time Integration Define rules for selecting CO Line items Transfer CO Documents retrospectively

Define Variants for Real-Time Integration

2ere we define parameters for (eal)%ime Integration.

Select the indicator to activate Real-Time Integration ey Date! is the date from "hen the Integration is active# If you decide to put a date in the past$ you can e%ecute &Transfer CO documents retrospectively' if no transfer "as made previously# It is recommended that you put the (ey date as the first date of the ne%t fiscal period# Account determination! This "ill use the account determination rules$ "hich you "ill configure in the ne%t step$ to post the accounting entry in )inancial Accounting# It is recommended that you al"ays select this indicator# If you do not select this indicator$ and
o o

*ost an allocation using a primary cost element$ SA* "ill use that +L account to post ,ac( into )I# *ost an allocation using a secondary cost element$ SA* "ill not post an entry ,ac( into )I#

Assign Document Type for CO)I Reconciliation postings# Leave Ledger field ,lan(# )I document "ill post to all ledgers# -ou could either select scenarios for "hich you "ant )I reconciliation documents to ,e posted. or use /AdI to select scenarios. or define Rules to select scenarios. You can,

for example, select all cross-profit centre documents (within the same company code) to be posted back to FI as well.

Avoid selecting transfer of all CO allocation Line Items or Trace 0 this "ill impact performance of the processes#

0ariant for (eal)%ime Integration can be defined in I4# menu path Financial Accounting (New) > Financial Accounting Global Settings (New) >Real-Time Integration of Controlling with Financial Accounting > efine !ariants for Real-Time Integration

0ariants for real time integration C' FI

Assign Variants for Real-Time Integration to Company Codes

0ariants for (eal)%ime Integration can be assigned by Company Code. Assign your ariant to all Company codes within the Controlling Area. Assignment of 0ariant for (eal)%ime Integration can be defined in I4# menu path Financial Accounting (New) > Financial Accounting Global Settings (New) >Real-Time Integration of Controlling with Financial Accounting > Assign !ariants for Real-Time Integration to Com"an# Co$es

Assign ariants to company code

Account Determination for Real-Time Integration

%here are two tables to be configured5

Define Intercompany Clearing Define Account Determination for Real-Time Integration

Define Intercompany Clearing

%his is generally configured as a part of general Finance configuration. %here is no additional configuration required here. When C'FI (econciliation posting is made in Financial Accounting, this table is used to populate the Inter Company customer and Inter Company 0endor account. 6ou can chec3 this configuration in I4# menu !ath Financial Accounting (New) > Financial Accounting Global Settings (New) >Real-Time Integration of Controlling with Financial Accounting > Account etermination for Real-Time Integration > efine Intercom"an# Clearing

7efine cross company code posting parameters

Define Account Determination for Real-Time Integration

When C'FI (econciliation posting is made in Financial Accounting, this table is used to populate the C'FI (econciliation clearing account. 6ou can define the C'FI reconciliation #$ account in I4# menu !ath Financial Accounting (New) > Financial Accounting Global Settings (New) >Real-Time Integration of Controlling with Financial Accounting > Account etermination for Real-Time Integration > efine Intercom"an# Clearing

7efine account for automatic posting of C' FI reconciliation

Define rules for selecting CO Line items

6ou can define your own rules to determine which C' line items should be selected for transfer to Financial Accounting. 6ou assign this rule in the ariant for C'FI (econciliation. Selection of chec3bo"es in the ariant is the standard way to acti ate the transfer* define rules only if you business process has special requirements 8eg. certain cross company code postings should not transfer bac3 to Financial Accounting9.

Transfer CO Documents retrospectively

6ou would only need to perform this if you acti ate C'FI (econciliation retrospecti ely in the ariant definition for (eal)%ime Integration.

Cross Company code Allocation in Controlling

I created a simple cross company allocation cycle to allocate I% costs from Cost Centre -.:: in Company Code 0//- to Cost Centre 1//- in Company Code 0//1.

4aintain C' assessment allocation cycle

'nce the allocation is performed, the system posts an entry into Controlling as shown below.

C' document from assessment

Costs are allocated from Company Code 0//- to Company Code 0//1. %his is a charge of costs across legal entities. 2ence, the posting should reflect in the legal boo3s as well. With C'FI (econciliation acti e and the tables configuration as shown abo e, the system has posted a cross company document in Financial Accounting as shown below.

FI document from C' assessment

%he #eneral $edger iew of the two documents in Company code 0//- and 0//1 is shown below.

Concl sion
With new #$ C'FI (eal)%ime Integration functionality, users can now e"pect FI documents posted in real time for all cross company code 8or any of the new #$ scenarios9 allocations in C'. %his eliminates the need to perform period end job to transfer C' postings to FI and has greatly help reduce the period end processing time.