Martin Ullmann

Maximizing SAP® ERP Financials Accounts Payable

Bonn � Boston

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Contents at a Glance

1 Vendor Master Data ................................................................ 23

2 Accounting Document Principles ............................................ 83

3 Business Transactions in Accounts Payable ............................ 93

4 Logistic Invoice Verification .................................................... 145

5 Outgoing Payment Processing ............................................... 221

6 Manual Payment Processing .................................................. 243

7 Automatic Payment Processing ............................................. 257

8 Check Processing ................................................................... 295

9 Bank Transfer .......................................................................... 319

10 Withholding Tax Reporting .................................................... 347

11 Use Taxes and VAT Taxes ........................................................ 371

12 Special GL Transactions in Accounts Payable ........................ 381

13 Document Reversals ................................................................ 393

14 Open Item Management ......................................................... 405

15 Periodic Processing ................................................................. 423

16 Authorization Concept ........................................................... 433

17 Accounts Payable Reporting ................................................... 445

18 Tables, Function Modules, and BAPIs .................................... 455

A Implementing a User-Exit ...................................................... 461

B Implementing a BTE ................................................................ 467

C Implementing a BAdI .............................................................. 471

D Implementing a Validation/Substitution in the Financial Accounting Component (FI) with User-Exits ........... 475

E The Author ............................................................................... 483

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Contents

Acknowledgements .................................................................................... 21

1 Vendor Master Data ................................................................. 23

1.1 Organization of Vendor Master Data ........................................... 231.1.1 Vendor Master Data and Organization Structure ............... 231.1.2 Vendor Master Account Groups ........................................ 25

1.2 General Data View ...................................................................... 271.2.1 Address ........................................................................... 271.2.2 Control Screen ................................................................. 301.2.3 Payment Transactions ....................................................... 351.2.4 Contact Persons ............................................................... 38

1.3 Company Code Data View .......................................................... 381.3.1 Accounting Information .................................................... 391.3.2 Payment Transaction ........................................................ 421.3.3 Correspondence .............................................................. 471.3.4 Withholding Tax .............................................................. 48

1.4 Purchasing Data View ................................................................. 481.4.1 Purchasing Data ............................................................... 481.4.2 Partner Functions ............................................................. 53

1.5 Vendor Master Configuration Steps ............................................. 551.5.1 Define Account Groups with Screen Layouts ..................... 561.5.2 Define Account Layout per Company Code ....................... 591.5.3 Define Screen Layout per Activity ..................................... 591.5.4 Define Message Control for Vendor Master Data .............. 601.5.5 Create Number Ranges for Vendor Accounts .................... 601.5.6 Assign Number Ranges to Vendor Account Groups ........... 611.5.7 Define Text IDs for Central Text (Vendors) ........................ 611.5.8 Define Text IDs for Accounting Text (Vendors) .................. 621.5.9 Define Text IDs for Purchasing Organization Texts ............. 62

1.6 Vendor Master Data Transactions ................................................ 631.6.1 Creating, Changing, and Displaying Vendor Master Data .. 631.6.2 Display Vendor Account Changes ................................... 641.6.3 Vendor Block/Unblock ..................................................... 651.6.4 Confirmation of Changes ................................................ 66

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1.6.5 Transfer Vendor Master Data ........................................ 661.6.6 Change Vendor Account Group ........................................ 67

1.7 Vendor Master Data Enhancements ............................................ 671.7.1 Vendor Master Data Validation ......................................... 681.7.2 Vendor Master Data — Authorization Check Using

BTE 00001460 ................................................................. 701.7.3 Vendor Master Data — User Defined Screen .................... 711.7.4 Vendor Master Substitution Using

BAdI VENDOR_ADD_DATA ............................................. 781.7.5 Personnel Number Validation Using User-Exit HRPBAS01 791.7.6 Other Enhancements ....................................................... 79

1.8 Vendor Master Data Search Helps ............................................... 801.9 Vendor Master Data Table Structure ........................................... 801.10 Deleting Vendor Master Data ..................................................... 811.11 Vendor Master Data Reporting ................................................... 811.12 Summary .................................................................................... 82

2 Accounting Document Principles ............................................. 83

2.1 Document Header ..................................................................... 832.1.1 Document Type ................................................................ 842.1.2 Document Number ........................................................... 872.1.3 Posting Date ..................................................................... 882.1.4 Document Date (Invoice Date) ......................................... 892.1.5 Invoice Receipt Date ........................................................ 892.1.6 Reference ......................................................................... 89

2.2 Document Line Item .................................................................. 892.2.1 Posting Key ...................................................................... 89

2.3 Summary .................................................................................... 92

3 Business Transactions in Accounts Payable ............................. 93

3.1 Invoice/Credit Memo Processing ................................................. 933.2 Invoice/Credit Memo – Enjoy Transaction ................................... 94

3.2.1 Templates ......................................................................... 953.2.2 Header and Vendor Data .................................................. 973.2.3 Information Area .............................................................. 1013.2.4 GL Accounts Item Area ..................................................... 101

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3.2.5 Invoice Simulation .......................................................... 1023.2.6 Simulate General Ledger ................................................ 1033.2.7 Invoice Posting ............................................................... 103

3.3 Invoice/Credit Memo – General ................................................. 1043.3.1 Vendor Invoice: Header Data ......................................... 1053.3.2 Vendor Invoice: Vendor Item ......................................... 1063.3.3 Vendor Invoice: Correct GL Account Item ...................... 1063.3.4 Enjoy Transaction/General Transaction Comparison ....... 108

3.4 Invoice/Credit Memo – Fast Entry .............................................. 1093.4.1 Fast Entry: Header Data .................................................. 1093.4.2 Fast Entry: Enter Items ................................................... 110

3.5 Invoice Entry Configuration Steps .............................................. 1113.5.1 Define Default Values for Enjoy Transactions ................. 1113.5.2 Define Default Values for General Transactions .............. 1123.5.3 Define Default Values for Fast Entry Transaction ............ 113

3.6 Document Parking ...................................................................... 1133.7 Discount Methods ..................................................................... 114

3.7.1 Gross Discount Method ................................................. 1143.7.2 Net Discount Method .................................................... 1153.7.3 Discount Method Differences ......................................... 117

3.8 Alternative Payees ...................................................................... 1173.8.1 Alternative Payee ........................................................... 1173.8.2 Alternative Payee in Document ...................................... 1183.8.3 Permitted Payee ............................................................. 1213.8.4 Recommendation ........................................................... 123

3.9 Recurring Entries ........................................................................ 1233.9.1 Recurring Entry Creation ................................................ 1243.9.2 Recurring Entry Execution .............................................. 1273.9.3 Additional Recurring Transactions .................................. 128

3.10 Account Assignment Models ....................................................... 1283.10.1 Account Assignment Models Maintenance .................... 1293.10.2 Account Assignment Models with Amounts ................... 1303.10.3 Account Assignment Models with Equivalence Numbers 130

3.11 One-time Vendor Invoices .......................................................... 1323.12 New GL and Document Splitting ................................................. 133

3.12.1 The New GL ................................................................... 1333.12.2 Document Splitting ........................................................ 133

3.13 Enhancements ............................................................................ 135

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3.13.1 One-Time Vendor Address Validation Using User-Exit SAPLFCPD ...................................................................... 135

3.13.2 Duplicate Invoice Check via Process BTE 00001110 ....... 1363.13.3 Exclude OK-codes in Enjoy Transactions via Public &

Subscribe BTE 00001140 ............................................... 1373.14 FI Substitutions and Validations .................................................. 137

3.14.1 Document Header Validation – Call-Up Point 1 .............. 1383.14.2 Document Line Item Validation – Call-Up Point 2 ........... 1383.14.3 Document Line Item Validation with User-Exit– Call-Up

Point 2 ........................................................................... 1393.14.4 Complete Document Validation – Call-Up Point 3 .......... 1403.14.5 Substitutions .................................................................. 141

3.15 Summary .................................................................................... 144

4 Logistic Invoice Verification ..................................................... 145

4.1 Three-Way Match Invoice Verification ......................................... 1454.1.1 Accounting Entries During Three-Way Match ................. 1474.1.2 Price Differences (Goods Receipt Document

Posted First) ................................................................... 1484.1.3 Price Differences (Invoice Document Posted First) .......... 149

4.2 Two-Way Match Invoice Verification ........................................... 1504.2.1 Blanket Purchase Orders ................................................ 151

4.3 Non-Valuated Goods Receipt ..................................................... 1514.4 GR-Based Invoice Verification ..................................................... 152

4.4.1 Invoice Verification Examples ......................................... 1534.4.2 GR-Based Invoice Verification Flag Set On ...................... 1554.4.3 GR-Based Invoice Verification Flag Set Off ...................... 1554.4.4 GR-Based Invoice Verification Conclusion ....................... 156

4.5 Invoice Entry Process with Transaction MIRO .............................. 1564.5.1 Worklist/PO Structure .................................................... 1574.5.2 Header and Vendor Data ................................................ 1584.5.3 Information Area ............................................................ 1594.5.4 Purchase Order Items Area ............................................. 1594.5.5 Invoice Posting ............................................................... 160

4.6 Invoice Parking ........................................................................... 1604.7 Incoming Invoice Configuration .................................................. 161

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4.7.1 Define Attributes of System Messages ............................ 1614.7.2 Define Tax Jurisdiction ................................................... 1624.7.3 Automatic Account Assignment ..................................... 1624.7.4 Number Assignment ....................................................... 1674.7.5 Tax Treatment in Invoice Reduction ............................... 1714.7.6 Maintain Default Values for Tax Code ............................ 1714.7.7 Configure the Treatment of Exchange-Rate Differences ..... 1724.7.8 Determine Mail to Purchasing When Price Difference

Occur ............................................................................. 1724.7.9 Define Vendor-Specific Tolerances .................................. 1724.7.10 Maintain Bar Code Entry ................................................ 1744.7.11 Activate Direct Entry to GL Accounts and Material

Accounts ........................................................................ 1744.7.12 Maintain List Variants ..................................................... 1744.7.13 Aggregation ................................................................... 1754.7.14 Define Start Logo ........................................................... 1754.7.15 Set Check for Duplicate Invoices .................................... 175

4.8 Special Functions During Invoice Entry ...................................... 1764.8.1 Subsequent Debit/Credit ............................................... 1764.8.2 Purchase Order Text ...................................................... 1784.8.3 Invoice Reduction ......................................................... 1784.8.4 Prepayment .................................................................... 1804.8.5 PO History Categories .................................................... 1824.8.6 Variance Types ............................................................... 183

4.9 Delivery Costs ............................................................................. 1834.9.1 Unplanned Delivery Costs .............................................. 1834.9.2 Planned Delivery Costs .................................................. 185

4.10 Stochastically Block ..................................................................... 1864.11 Tolerances ................................................................................... 188

4.11.1 Tolerance Keys ............................................................... 1884.11.2 Invoice Block Configuration ........................................... 1914.11.3 Activate Workflow Template .......................................... 1924.11.4 Item Amount Check ....................................................... 192

4.12 Release Blocked Invoices (MRBR) ............................................... 1934.13 Enhancements During Invoice Entry ............................................ 195

4.13.1 Default Transaction Values with BAdI MRM_TRANSACT_DEFAULT .......................................... 195

4.13.2 Default Header Fields: MRM_HEADER_DEFAULT .......... 1964.13.3 Default Payment Terms: MRM_PAYMENT_TERMS ........ 197

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4.13.4 Validate Document Header: MRM_HEADER_CHECK .............. 1974.13.5 Complete Document Validation: INVOICE_UPDATE .......... 1974.13.6 Additional BAdIs During Invoice Verification .................. 198

4.14 Evaluated Goods Receipt Settlement (ERS) ................................. 1994.14.1 How to Avoid Pitfalls ..................................................... 1994.14.2 Configuration Steps ........................................................ 2004.14.3 Master Data Settings ...................................................... 2004.14.4 ERS Execution ................................................................ 2024.14.5 Planned Delivery Cost Settlement .................................. 2044.14.6 ERS Enhancements ......................................................... 204

4.15 Invoicing Plans ............................................................................ 2064.15.1 Configuration Steps ........................................................ 2064.15.2 Master Data Settings ...................................................... 2074.15.3 Invoicing Plan Settlement Execution ............................... 2094.15.4 Invoicing Plan Enhancements ......................................... 210

4.16 Consignment/Pipeline Stock Settlement ...................................... 2114.16.1 Consignment Stock ........................................................ 2114.16.2 Pipeline Stock ................................................................ 2124.16.3 Enhancements for Consignment and Pipeline Settlement 212

4.17 Invoicing Verification in the Background ..................................... 2124.18 GR/IR Account Maintenance ...................................................... 213

4.18.1 GR/IR Clearing Configuration Steps ................................ 2154.18.2 Execution of Transaction MR11 ...................................... 2164.18.3 Transaction MR11SHOW ................................................ 219

4.19 Invoice Overview ........................................................................ 2194.20 Invoice Display .......................................................................... 2204.21 Summary .................................................................................... 220

5 Outgoing Payment Processing ................................................ 221

5.1 Payment Method ........................................................................ 2215.1.1 Country-Specific Definitions for the Payment Method ... 2225.1.2 Company Code Specific Definitions for the Payment

Method ......................................................................... 2275.2 Payment Method Supplements ................................................... 2345.3 Payment Terms ........................................................................... 235

5.3.1 Baseline Date and Net Due Date ................................. 2365.3.2 Defaulting of Payment Term Values .............................. 236

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5.3.3 Payment Term Configuration ........................................... 2375.4 Payment Grouping ..................................................................... 2395.5 Payment Block Reasons ............................................................... 2405.6 Summary .................................................................................... 242

6 Manual Payment Processing ................................................... 243

6.1 Post Outgoing Payments ............................................................. 2436.1.1 Header Data .................................................................... 2446.1.2 Select Open Items .......................................................... 248

6.2 Post Outgoing Payments + Print forms ........................................ 2506.2.1 Header Data .................................................................... 2516.2.2 Header Document Data ................................................... 253

6.3 Post Incoming Payments ............................................................. 2546.4 Configuration Steps ..................................................................... 254

6.4.1 Define Default Document Type ....................................... 2546.5 Summary .................................................................................... 255

7 Automatic Payment Processing ............................................... 257

7.1 Payment Program Process Flow ................................................... 2587.2 Executing the Payment Program (F110) ....................................... 259

7.2.1 Creation of a Payment Run .............................................. 2607.2.2 Planning and Parameter Specifications .............................. 2627.2.3 Payment Proposal Run ..................................................... 267

7.3 Executing the Payment Program Periodically (F110S) .................. 2757.4 Payment Program Configuration .................................................. 275

7.4.1 Set Up All Company Codes for Payment Transactions ........ 2767.4.2 Set Up Paying Company Codes for Payment Transactions .. 2787.4.3 Set Up Payment Methods per Country for Payment

Transactions .................................................................... 2817.4.4 Set Up Payment Methods per Company Code for

Payment Transactions ...................................................... 2817.5 Set Up Bank Determination for Payment Transactions ................ 281

7.5.1 House Banks .................................................................... 2827.5.2 Bank Accounts ................................................................. 2847.5.3 Bank Account Selection Logic ........................................... 2857.5.4 Configuration Steps for Bank Determination for

Payment Transactions ....................................................... 286

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7.6 Enhancements ........................................................................... 2907.6.1 Payment Program: Item Selection with Process BTE

00001820 ....................................................................... 2907.6.2 Payment Program: Individual Bank Determination with

Process BTE 00001810 .................................................... 2927.6.3 Payment Program: Edit Groups with Process BTE

00001830 ....................................................................... 2937.6.4 Payment Proposal: Maintenance Authorization Check with

Process BTE 00001860 .................................................... 2947.7 Summary .................................................................................... 294

8 Check Processing ..................................................................... 295

8.1 Check Management Configuration .............................................. 2968.1.1 Check Lot ......................................................................... 2968.1.2 Void Reasons .................................................................... 298

8.2 Check Printing Program .............................................................. 3008.2.1 RFFOUS_C Print Program Sections .................................... 3008.2.2 Variants ............................................................................ 3068.2.3 MICR Printer .................................................................... 306

8.3 Check Form ................................................................................ 3078.3.1 Check Layout .................................................................... 3078.3.2 Check Form Enhancements ............................................... 308

8.4 Check Management Transactions ................................................ 3108.5 Display Check Information .......................................................... 311

8.5.1 Display Checks ................................................................. 3118.5.2 Check Register .................................................................. 312

8.6 Change Check Information .......................................................... 3128.6.1 Reprint Checks ................................................................. 3128.6.2 Change Additional Information/Check Encashment .......... 3138.6.3 Online Cashed Checks ...................................................... 313

8.7 Manual Checks ........................................................................... 3148.8 Void Checks ................................................................................ 314

8.8.1 Void Issued Checks ......................................................... 3148.8.2 Cancel Payments ............................................................ 315

8.9 Reset Check Data ...................................................................... 3158.10 External Data Transfer/Positive Pay .............................................. 3158.11 Create Reference for Check ......................................................... 3178.12 Summary .................................................................................... 318

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9 Bank Transfer ........................................................................... 319

9.1 ACH Payments ............................................................................ 3209.1.1 ACH Payment Types ......................................................... 320

9.2 Bank Transfer Using the Classic Payment Medium Program ......... 3219.2.1 RFFOUS_T Program Sections ............................................ 3219.2.2 Variants ............................................................................ 3279.2.3 Configuration Steps .......................................................... 3279.2.4 Enhancements .................................................................. 329

9.3 Payment Medium Workbench (PMW) ......................................... 3309.3.1 Create Payment Medium Format ...................................... 3309.3.2 Create/Assign Payment Selection Variants ......................... 3339.3.3 Adjust Note to Payee ........................................................ 3369.3.4 Assign Payment Medium Format ...................................... 3379.3.5 Enhancements .................................................................. 338

9.4 Execution of the Payment Program for Payment Medium Formats ...................................................................................... 3419.4.1 Payment Advice ................................................................ 3419.4.2 Schedule Payment Run .................................................... 3419.4.3 Data Medium Exchange Administration ............................ 342

9.5 Prenotifications ........................................................................... 3429.5.1 Select Bank Details ........................................................... 3439.5.2 Create Prenotification File ................................................ 3439.5.3 Import Feedback .............................................................. 3449.5.4 Display File ....................................................................... 3449.5.5 Change Memo Records ..................................................... 344

9.6 Summary .................................................................................... 345

10 Withholding Tax Reporting ..................................................... 347

10.1 Classic Withholding Versus Extended Withholding Tax Reporting ................................................................................... 348

10.2 Migrating to Extended Withholding Tax Reporting ...................... 34910.2.1 Migration Steps .............................................................. 350

10.3 1099-MISC Configuration Using Classic Withholding Tax ............ 35210.3.1 Maintain Tax Codes ........................................................ 35210.3.2 Maintain Document Change Rules ................................. 354

10.4 1099-MISC Configuration Using Extended Withholding Tax ........ 355

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10.4.1 Define the Withholding Tax Type for Payment Posting .... 35510.4.2 Define Withholding Tax Codes ....................................... 35610.4.3 Assign Withholding Tax Types to the Company Code ...... 35710.4.4 Assign Accounts for Withholding Tax to Be Paid Over .... 35810.4.5 Document Change Rules ................................................ 358

10.5 1099 Interest Configuration ........................................................ 35910.6 1099-G Configuration ................................................................. 35910.7 1042-S Configuration .................................................................. 36010.8 Vendor Master Data .................................................................. 361

10.8.1 Vendor Master Data for Classic Withholding Tax Reporting ....................................................................... 361

10.8.2 Vendor Master Data for Extended Withholding Tax Reporting ....................................................................... 362

10.9 Correction Programs ................................................................... 36310.9.1 RFWT0010: Adjustment of Withholding Tax Code for

Open Items .................................................................... 36310.9.2 RFWT0020: Adjust Withholding Tax Information in

Cleared Documents ....................................................... 36510.10 Generic Withholding Tax Reporting Tool .................................... 36610.11 Summary .................................................................................... 369

11 Use Taxes and VAT Taxes ......................................................... 371

11.1 Use Tax within the United States ................................................. 37111.1.1 Tax Procedures ............................................................... 37211.1.2 Use Tax Configuration .................................................... 37311.1.3 Jurisdiction Code Maintenance in Master Data ............... 37611.1.4 Tax Code Maintenance in Master Data ........................... 37711.1.5 Tax Reporting for Use and Sales Tax ................................ 377

11.2 VAT Taxes in Europe ................................................................... 37711.2.1 Tax Procedures ............................................................... 37811.2.2 VAT Configuration .......................................................... 37811.2.3 Tax Code Maintenance in Master Data ........................... 380

11.3 Summary .................................................................................... 380

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12 Special GL Transactions in Accounts Payable .......................... 381

12.1 Down Payments ......................................................................... 38112.1.1 Entering a Down Payment Request ................................ 38212.1.2 Paying a Down Payment Request .................................. 38412.1.3 Invoice Entry .................................................................. 38512.1.4 Down Payment Clearing ................................................. 386

12.2 Down Payment Configuration Steps ........................................... 38612.2.1 Define the Alternative Reconciliation Account for Down

Payment ......................................................................... 38612.2.2 Allow Automatic Payments for Special GL Indicators ...... 389

12.3 Other Special GL Transactions ..................................................... 38912.3.1 Entering Special GL Transactions .................................... 38912.3.2 Entering Noted Items ..................................................... 390

12.4 Summary ................................................................................... 391

13 Document Reversals ................................................................. 393

13.1 Negative Postings ....................................................................... 39313.1.1 Configuration Steps for Negative Postings ...................... 395

13.2 Reversal Reasons ....................................................................... 39613.2.1 Best Practice Reversal Reasons ....................................... 397

13.3 FB08: Individual Document Reversal ........................................... 39813.4 F.80: Mass Document Reversal ................................................... 39913.5 FBRA: Reset Cleared Items .......................................................... 40013.6 MR8M: Cancel Invoice Document in LIV .................................... 40213.7 Summary .................................................................................... 403

14 Open Item Management .......................................................... 405

14.1 Manual Vendor Clearing ............................................................. 40614.1.1 Manual Clearing Transition F-44 .................................... 40614.1.2 Select Open Items ......................................................... 40814.1.3 Clearing Line Layout Configuration ................................ 41014.1.4 Editing Options ............................................................. 410

14.2 Transfer with Clearing ................................................................. 41114.2.1 Post with Clearing Transaction F-51 ............................... 41114.2.2 Post with Clearing: Vendor Item ..................................... 413

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14.2.3 Post with Clearing: Select Open Items ............................ 41414.2.4 Post with Clearing: Process Open Items .......................... 416

14.3 Automatic Clearing .................................................................... 41614.3.1 LIV Document Clearing with Reversal Documents .......... 41714.3.2 GR/IR Account Clearing ................................................. 41814.3.3 Automatic Account Clearing Execution ........................... 419

14.4 Summary .................................................................................... 422

15 Periodic Processing ................................................................... 423

15.1 Interest Calculation ..................................................................... 42315.1.1 Calculation of Interest on Arrears .................................. 42415.1.2 Interest Calculation Process ........................................... 42415.1.3 Interest Calculation Configuration ................................. 42515.1.4 Vendor Master Data Fields for Interest Calculation ........ 42615.1.5 Exclude Line Items from the Interest Calculation ............ 427

15.2 Foreign Currency Revaluation ..................................................... 42815.2.1 Configuration steps from the Classic GL ......................... 42915.2.2 Configuration Steps from the New GL ........................... 431

15.3 Balance Carry Forward ................................................................ 43115.4 Summary .................................................................................... 432

16 Authorization Concept ............................................................. 433

16.1 SAP Authorization Concept ........................................................ 43316.1.1 User Roles ...................................................................... 43416.1.2 Authorization Objects .................................................... 435

16.2 SAP Predefined User Roles .......................................................... 43616.3 Authorization Objects in Accounts Payable ................................. 438

16.3.1 Vendor Master Maintenance .......................................... 43816.3.2 Accounting Documents .................................................. 44016.3.3 Logistic Invoice Verification ............................................ 44116.3.4 Payments ....................................................................... 44116.3.5 Check Management ....................................................... 442

16.4 Line Layout Protection ................................................................ 44216.5 Summary .................................................................................... 444

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17 Accounts Payable Reporting ..................................................... 445

17.1 Information System .................................................................... 44517.2 Vendor Line Items (FBL1N) ......................................................... 446

17.2.1 Special Fields ................................................................. 44817.2.2 User-Defined Fields via Process & Subscribe

BTE 00001650 ............................................................... 45017.2.3 Line Item Subtotals/Sorting ............................................ 45217.2.4 Vendor Line Item Layout Summary ................................ 453

17.3 Summary .................................................................................... 453

18 Tables, Function Modules, and BAPIs ..................................... 455

18.1 Tables ......................................................................................... 45518.1.1 Vendor Master Data Table Structure ............................... 45518.1.2 Transactional Data Tables ............................................... 45618.1.3 Logistic Invoice Verification Tables ................................. 456

18.2 Function Modules ....................................................................... 45718.3 BAPIs .......................................................................................... 45718.4 Summary .................................................................................... 457

Appendices ....................................................................................... 459

A Implementing a User-Exit .................................................................... 461B Implementing a BTE ............................................................................. 467C Implementing a BAdI ........................................................................... 471D Implementing a Validation/Substitution in the Financial Accounting

Component (FI) with User-Exits ............................................................ 475E The Author ........................................................................................... 483

Index ........................................................................................................... 485

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Tax requirements vary greatly by country. Even within the same coun-try, different tax rates may apply by region or jurisdiction. This chapter describes the main configuration steps for use tax in the United States and VAT tax in Europe.

Use Taxe11 s and VAT Taxes

Every organization is required to collect taxes or pay taxes on purchases and sales regardless of the country, size, or type of organizations. However, great differ-ences exist in the way the taxes are calculated, reported, and paid. Multinational companies have to comply with these tax rules, if they are doing business in dif-ferent countries.

The intention of this chapter isn’t to give a detailed view of the tax configuration details by country but rather to give a comprehensive overview of two common tax concepts:

Use tax in the United StatesEE

VAT tax in EuropeEE

Use Tax within the United States11.1

The use tax calculation for jurisdictions is usually based on three components:

The jurisdiction in which the buyer takes possessionEE

The use of the service or materialEE

The tax status of the legal entity that purchased the service or materialEE

Within SAP software, use tax is calculated using a special tax calculation proce-dure. Within this procedure, different rates are defined by jurisdiction code and tax code.

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UseTaxesandVATTaxes11

The tax jurisdiction code defines the location of the sender and receiver of the goods purchased. This is important because the sender and receiver information is needed to properly calculate use tax. The tax jurisdiction codes are usually assigned to master data such as vendor or cost center.

The tax code defines whether goods are taxable or not. Within the tax calculation procedure, the tax code is assigned to a rate by jurisdiction using the condition technique.

Tax Procedures11.1.1

The SAP software delivers three tax procedures for the United States:

TAXUS:EE Sales/use tax in United States.

TAXUSJ:EE Sales/use tax with jurisdiction.

TAXUSX:EE Sales/use tax with jurisdiction in an external system.

In this chapter, we’ll cover the TAXUSJ procedure, which is the most commonly used procedure if no external tax calculation software is used. This procedure relies on all information stored within the SAP software to calculate the correct tax rate. This is practical for organizations that operate regionally and have simple tax cal-culation rules. For this procedure, the rate and conditions have to be maintained on a regular basis within the SAP software.

For large organizations that operate in multiple states with multiple product lines and procurement channels, the TAXUSX procedure is a better fit. This procedure is also jurisdiction based but communicates with an external tax calculation system. The rates and calculations are handled externally.

The third TAXUS procedure doesn’t allow the calculation by jurisdiction, which isn’t common. This procedure is only feasible for organizations that operate within one jurisdiction.

Figure 11.1 shows the tax calculation procedure TAXUSJ.

Each single calculation area, such as AP use tax, can have up to four different con-dition types that can represent different rates for state, county, or city.

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UseTaxwithintheUnitedStates 11.1

Tax Calculation Procedure TAXUSJFigure 11.1

Use Tax11.1.2 Configuration

The tax procedure is assigned to the country as shown in Figure 11.2 via Trans-action OBBG or in the IMG via navigation path IMG • Financial Accounting •

Financial Accounting Global Settings • Tax on Sales/Purchases • Basic Settings • Assign Country to Calculation Procedure.

Tax Procedure Assignment to CountryFigure 11.2

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UseTaxesandVATTaxes11

In the next step, the structure of the tax jurisdiction code needs to be defi ned. The tax jurisdiction code is usually nine characters long. The structure can be defi ned via Transaction OBCO or in the IMG via navigation path IMG • Financial Account-ing • Financial Accounting Global Settings • Tax on Sales/Purchases • Basic Set-tings • Specify Structure for Tax Jurisdiction Code. Figure 11.3 shows the IMG confi guration screen of the tax jurisdiction code structure.

Tax Jurisdiction Code StructureFigure 11.3

If you’re using the TAXUSJ procedure, all relevant tax jurisdiction codes need to be defi ned for the sender as well as for the receiver jurisdictions. This task is done as shown in Figure 11.4 in the IMG via navigation path IMG • Financial Accounting • Financial Accounting Global Settings • Tax on Sales/Purchases • Basic Settings • Defi ne Tax Jurisdictions.

Tax Jurisdiction Code CreationFigure 11.4

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UseTaxwithintheUnitedStates 11.1

In the next step, the tax rates by tax code and jurisdiction need to be defi ned. The SAP software delivers a set of predefi ned tax codes for the tax calculation procedure TAXUSJ as shown in Figure 11.5. The tax rates can be maintain in the IMG under navigation path IMG • Financial Accounting • Financial Accounting Global Settings • Tax on Sales/Purchases • Calculation • Defi ne Tax Codes for Sales and Purchases.

Predefi ned Tax Codes Provided in the SAP SoftwareFigure 11.5

You can adjust the description by clicking on the Properties button as shown in Figure 11.6.

Depending on the jurisdiction code entered, such as state, county, or city jurisdic-tion code, different fi elds are available to maintain the tax rate. This is controlled within the confi guration of the condition type within the tax procedure.

Within this confi guration step, the GL accounts need to be defi ned by transaction key. This transaction key or account key is assigned in the defi nition of the tax cal-culation procedure as shown earlier in Figure 11.1. To assign a GL account, click on the Tax accounts button.

The maintenance of the tax rate and GL account concludes the confi guration for U.S. use tax.

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Tax Rate Maintenance in Procedure TAXUSJ Figure 11.6

Jurisdiction Code11.1.3 Maintenance in Master Data

To avoid manual input of the jurisdiction code in procurement or during invoice entry, it’s recommended to enter the jurisdiction code in master data. That also means that master data need to be set up based on jurisdiction rather then area of responsibility.

For example, if the jurisdiction code is maintained in the cost center master data, it’s defaulted automatically during invoice entry with Transaction FB60. In detail, the jurisdiction code can be maintained in the following master data:

Company codeEE

PlantEE

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VATTaxesinEurope 11.2

Storage locationEE

Cost centerEE

Internal orderEE

WBS-elementEE

All of these master data items represent the receiver or ship-to jurisdiction codes. In addition, the jurisdiction also has to be maintained in the vendor master data as well to calculate the appropriate use tax rate based on the shipping address of the vendor.

Tax Code Maintenance in Master Data11.1.4

To determine which purchases are relevant for tax, the tax codes need to be main-tained in the following master data:

GL accountEE

Material master EE

Tax Reporting for Use and Sales Tax11.1.5

SAP software provides a standard report RFATAX00 for use and sales tax reporting. This report can be executed via Transaction S_ALR_87012394. All documents are displayed per customer or vendor account and are totaled by tax code and jurisdic-tion with reference to the tax base and amount.

VAT Tax11.2 es in Europe

Value added tax (VAT) is an indirect tax levied on the added value that results from each exchange of goods and materials. It differs from a sales tax because a sales tax is levied on the total value of the exchange.

For this reason, VAT is neutral with respect to the number of passages between the producer and the final consumer. Personal end-consumers of products and services can’t recover VAT on purchases, but businesses are able to recover VAT on the materials and services that they buy to make further supplies or services directly or indirectly sold to end users. In this way, the total tax levied at each stage in the economic supply chain is a constant fraction of the value added by a business to

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its products, and businesses bear most of the cost of collecting the tax. VAT is the common form of taxation in most European countries.

Tax Procedures11.2.1

SAP software delivers VAT procedures for every European country. For example, the following tax procedures are predefi ned:

TAXD:EE Germany

TAXF:EE France

TAXES:EE Spain

TAXIT:EE Italy

We’ll only cover the tax procedure for France TAXF here because all other Euro-pean tax procedures work in a similar way. Usually, the tax rates are the same within a country and don’t vary by region. However, some countries such as Italy and Spain require regional codes for reporting purposes. Figure 11.7 shows the tax calculation procedure TAXF for France.

The tax calculation procedure is simpler than the U.S. tax calculation procedure TAXUSJ because no tax rates need to be defi ned by region.

Tax Calculation Procedure TAXFFigure 11.7

VAT Configuration11.2.2

In the fi rst step, the tax procedure is assigned to the country as shown earlier in the TAXUSJ confi guration in Figure 11.1 via Transaction OBBG or in the IMG via navigation path IMG • Financial Accounting • Financial Accounting Global Set-

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VATTaxesinEurope 11.2

tings • Tax on Sales/Purchases • Basic Settings • Assign Country to Calculation Procedure.

Tax RatesIn the next step, the tax rates by tax code need to be defi ned. SAP software deliv-ers a set of predefi ned tax codes for the tax calculation procedure TAXF as shown in Figure 11.8. The tax rates can be maintained in the IMG under navigation path IMG • Financial Accounting • Financial Accounting Global Settings • Tax on Sales/Purchases • Calculation • Defi ne Tax Codes for Sales and Purchases.

Predefi ned Tax Codes by SAP SoftwareFigure 11.8

The description can be changed by clicking on the Properties button as shown in Figure 11.9. Within this confi guration step, the GL accounts also need to be defi ned by transaction key. This transaction key or account key is assigned in the defi nition of the tax calculation procedure as shown previously in Figure 11.7. To assign a GL account, click on the Tax accounts button.

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Tax Rate Maintenance Figure 11.9

The maintenance of the tax rate and GL account concludes the confi guration for VAT reporting.

Tax Code Maintenance in Master Data11.2.3

To determine which purchases are relevant for tax, the tax codes need to be main-tained in the following master data:

GL accountEE

Material master EE

Summary11.3

In this Chapter the most common forms of taxation in AP were described, Use tax in the Unites States and VAT tax in Europe. The SAP software delivers tax proce-dures by tax types and country.

In the next Chapter, AP transactions with the Special GL Indicator are described.

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485

1042 NRA 3601099 Government 3481099 Interest 348, 3591099 Miscellaneous 347

A

Account assignment model 128Account assignment templates 95Account document authorization 440Account Groups 25, 56, 61Account ID 284ACH payments 320Aggregation 175Alternative Payee 35, 36, 117Alternative reconciliation account 381, 386ALV 442Amount split 100Authorization 433Authorization check 70, 294Authorization object 435Automatic account assignment 162Automatic clearing 416

B

Balance carry forward 431Bank account 284Bank details 35, 225Bank determination 281Bank transfer 319BAPIs 457Blank check 295Blanket purchase order 151Business Add-In 67, 135, 471Business Address Services 27Business transaction event 67, 135, 290, 467

C

Cancel invoice 402Check

Cancel 315 Change 312 Display 311 Reprint 312 Void 314

Check lot 296Check management 296, 310Check management authorization 442Classic payment medium program 227, 277Classic Withholding tax 348, 352, 361Company Code 23Consignment stock 211Contact person 38Correspondence 47Credit memo 93

D

Discount 114, 117Document parking 113Document reversal 393Document type 84, 112Down payment 381Down payment clearing 386Duplicate invoice check 136, 175

E

Enhancements 67, 135, 195, 204, 290, 308, 329, 338, 461Enjoy transaction 94, 108Equivalence number 130Evaluated receipt settlement 52, 202Extended Withholding tax 349, 355

Index

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Index

F

Fiscal address 32Foreign currency evaluation 428Function modules 457

G

General transaction 104, 108, 112Generic withholding tax tool 366Global layout 443GR based invoice verification 152GR/IR 213GR/IR account maintenance 213GR/IR clearing 215, 418Gross discount 114

H

Hold document 96, 157House bank 42, 282

I

Incoming payment 254Incoterms 49Industry key 33Information system 445Interest calculation 41, 423, 425Interest calculation 423Interest indicator 426Interest on arrears 424Invoice block 191Invoice date 89Invoice entry 111, 156, 176, 195, 385Invoice fast entry 109Invoice overview 219Invoice parking 160Invoice receipt date 89Invoice reduction 178Invoice release 195Invoice simulation 102Invoicing plan 206

L

LIV authorization 441Logistic invoice verification 145, 441, 456

M

Manual checks 314Mass reversal 399Message control 60, 161MICR code 295MICR printer 306Minority indicator 41MIRO 156

N

Negative posting 86, 393Net discount 115New GL 133, 431Non-valuated goods receipt 151Note to payee 336Noted items 388, 390Number assignment 167Number range 60, 86, 168

O

One-time vendor 132Open item management 405Outgoing payment 243

P

Partial payments 249Partner functions 53Payee in document 118Payment advice 232, 341

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Index

Payment authorization 441Payment block 45, 240Payment grouping 239Payment medium 226Payment medium form 231Payment medium workbench 227, 266, 330Payment method 221Payment method 221Payment method supplement 234Payment program 257Payment proposal 259, 267Payment run 260, 272Payment term 235Payment terms 42, 49, 235Permitted Payee 35, 37, 121Personnel number 42, 79Pipeline stock 212Planned delivery 185Positive pay 315Posting date 88Posting key 89, 104, 112Prenotification 342Prenumbered check 295Prepayment 180Price differences 148Printout 266Purchase order text 178Purchasing data 48Purchasing Organization 24

Q

Quantity differences 189, 213

R

Reconciliation account 39Recurring entries 123Release approval group 41Reset cleared items 400Reversal reason 396RFFOUS_C 300RFFOUS_T 321

S

Screen layout 56Screen variants 95Search help 80Search terms 29Sensitive fields 66Sort key 40Special fields 448Special GL transaction 381Standard Carrier Alpha Code 33Stochastically block 186Subsequent debit/credit 176Substitution 78, 137, 475

T

Tables 455Tax code 352, 356Tax jurisdiction 162, 372, 374Tax number 31Tax procedure 372, 378Tax type 355Text ID 61Three-way match 145Tolerance group 43Tolerances 172, 188Transfer with clearing 411Two-way match 150

U

Unplanned delivery 183Use tax 371User defined layout 11User roles 434, 436User-defined fields 450User-exit 68, 79, 135, 139, 329, 471, 475

V

Validation 68, 79, 137, 475VAT tax 377

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Index

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Vendor address 37, 46Vendor authorization 440Vendor clearing 406Vendor line items 446Vendor master data 23

Block 65 Change 63 Configure 55 Create 63

Display 63 Delete 81

Void reason 298

W

Withholding tax 41, 48, 347

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