Offsetting entry and account determination

[Former Member]

Hi friends,

The question I'm putting across might sound silly. I have tried a lot to understand these on my own but I still don't feel confident on my own understanding. Hence I'm seeking your help.

Can you please explain me the meaning of Offsetting Entry in SAP in layman language ? Could you also provide me some examples?

It would be great if you can answer the following questions as well-

1. What is the purpose of the T/E key PRD and why is T/E key PRD required for movement type 101.

2. For movement type 251 and posting string WA01, the account modifier is VBR. The G/L account assigned for GBB-VBR is 50100000 for valuation class 3000. Does it mean that a GI for sales of a material of valuation class 3000 will ONLY hit 50100000 and will not hit any other G/L account?

Thanks a lot for your help.

Rana

[raghavendra_praveen]

Hi

Offsetting entries are other credit/debit entries against inventory accounts. When any entry is hitting stock account some other account should negate it - it will be through GBB transaction key in OBYC.

If any price difference is applied then PRD account will be hit in postings (ex: condition values for standard priced material will be posted to PRD account as delivery charges will not alter the standard price of material). If the material price is standard price and PO price is different to that of MMR price then that difference value will go to PRD account when you post GR.

2. For movement type 251 and posting string WA01, the account modifier is VBR. The G/L account assigned for GBB-VBR is 50100000 for valuation class 3000. Does it mean that a GI for sales of a material of valuation class 3000 will ONLY hit 50100000 and will not hit any other G/L account?

Yes.

Thanks

[Former Member]

Hi Prabu and Praveen,

Thanks a lot for your response. Let me express what I understood and please correct me if I go wrong.

For mv.ty. 101, BSX and WRX are triggered to hit the assigned G/L accounts. Since offsetting is done to WRX for BSX, hence we don't need a GBB T/E key to make another offsetting entries.

But for 251 movement, the inventory account is credited and the COGS account is debited. If I look at the account determination, I see that G/L 50100000 is hit by GBB-VBR. So where is the other entry? Per my understanding, there should be an entry to BSX as well for 251.

Waiting for your response.

Thanks!

Rana

Addition- I checked the account grouping for movement type 251 but I didn't see any T/E key associated with it apart from PRD. So, if GBB-VBR makes the offsetting entry to a G/L account then where is the original posting?

Edited by: Rana Dutta on May 15, 2009 4:57 AM

[Former Member]

Hi

For the 101, you will have BSX / WRX entries

For 251, Consumption for Sales from ware house, you will have the GBB/VBR & also entry for BSX as your stock will get reduced.

PRD as explained above is mostly gets activated if your material is having S as price indicator. This gets activated during GR. Also for material with V indicator during Invoice verification if there is noo sufficient stocke coverage during the processing, This has no relation to Offset posting activities i.e GBB area. 251 will not have any PRD entry as the material will be issued at master price there.

Regards

[raghavendra_praveen]

Hi

251 movement type is for consumption process (infact 2* series mvt types are for consumption).

In case of consumption BSX will not be hit as it is inventory (stock) account. Consumption postings means offsetting to inventory - which will be defined in GBB. Depending on the account assignment consumption posting (say VBR, VBO) will be defined. Check account grouping for mvt type 251 in OMJJ.

Addition- I checked the account grouping for movement type 251 but I didn't see any T/E key associated with it apart from PRD. So, if GBB-VBR makes the offsetting entry to a G/L account then where is the original posting?

If you check value string as said above it is PRD-PRA account for price difference.

Thanks

[former_member433442]

Hi,

Offsetting entry is nothing but to manage the debit/credit entries. If one acount is geting debited, then some other aount should be credited to nullify the same. So for this purpose we are using Offseting entries.

1. The purpose of T/E key PRD is for price difference account.If you maintain standard price for a material and if there is price difference between standard price and PO price, then this key will get triggered.

2. Yes you are right, for that movement type and valuation class, always that particular G/L account will be triggered.

Regards,

Prabu