Unit 5: Accounts Receivable

Figure 99: Adjustment of Receivables

The following options are available for creating value adjustments for receivables:

1. You enter Individual Value Adjustments (IVA) as a special G/L transaction E.

2. You use the program SAPF107 ( “Additional valuations” ) to carry out a flat-rate individual
value adjustment. This program is executed by using the Fiori App Further Valuation or the
transaction code F107.

3. Once you have determined the amount of the value adjustment, you adjust the flat-rate
value by making a manual G/L account posting. The posting record is: Expense from flat-
rate value adjustment to value adjustment.

Figure 100: Individual Value Adjustment for Doubtful Receivables

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 Lesson: Performing Accounts Receivable Closing Operations

Doubtful receivables are written off as an Individual Value Adjustment (IVA) during year-end
closing. The special general ledger method is suitable for this procedure because the
transaction is entered in the customer account and is also “posted” to a special G/L account,
Individual Value Adjustments for Receivables.
After you have ascertained that the debt is irrecoverable or that the receivable has been paid,
the individual value adjustment is reversed. If the debt is irrecoverable, the receivable is
cleared from the customer account and the amount is posted to the account for Depreciation
of Receivables. The sales tax is adjusted in the posting.

Flat-rate Individual Value Adjustment

You can use a valuation program to perform value adjustments. The program functions like
the dunning and payment program. Each valuation run is clearly identified by the Run date
and Identification fields.

Value Adjustment Parameters

You can specify how to execute the valuation by entering parameters for the valuation run.
You can use the parameters of an existing valuation run as a template. These parameters
include the valuation method, valuation area, and posting specifications.

Figure 101: Value Adjustment Parameters

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