FP04 : Write off and debiting Tax accounts

[Former Member]

Dear All,

I have an issue with debiting tax account on write off.

Scenario: Invoice posted $1000 including tax of $100. i.e $900 consumption (revenue) + $100 tax.

GL Postings:

Customer account 1000 Dr

Revenue Account 900 Cr

Sales tax 100 Cr.

Write off( FP04 any reason codes).

System posts the Following:

Customer account 1000 Cr

Expense Account 1000 Dr

I need it to be like:

Customer account 1000 Cr

Expense Account 900 Dr

Sales tax 100 Dr.

I've tried everything I can, but I think I'm missing something very obvious and silly.

1) Maintained posting areas:

0120 : Expense Account (No tax code specified and tried with tax code too)

0121 : Expense Account for non tax related items (same expense account)

0122 : Tax Adjustment Flag (Tested with both flag on and off)

2) Define Act Assignments ReLU to Main Transactions

Company Division Act Deter Main Acct

1000 10 01-10 0090 Expense account

1000 10 01-10 0095 Expense account

3) ISU u2013 Define Acct Assignment Relv to Transactions

Set Main receivable account (Customer account) for all combination of 0090 and 0095. i.e. 0010 and 0020.

Company Division Act Deter Main/Sub Acct

So what am I doing wrong?

Thank you very much.

Edited by: JayUtility on Jan 31, 2012 2:53 PM

[ivor_martin]

Hi,

Try the conifguration for "Change in Tax Code with Write-offs".

With this you can configure the same Tax GL Account for a different Tax Code, so you are accomplishing the desired finacial result.

Regards,

Ivor M

[Former Member]

Thank you Ivor. Tried that too.

I'm still stuck at:

Customer (AR) Account 1000 Cr

Expense Account 1000 Dr

The entire invoice amount is debiting against the Expense / bad debt account.

I need that only the consumption portion should debit Expense account and the Tax portion should debit the Tax account.

Customer account 1000 Cr

Expense Account 900 Dr

Sales tax 100 Dr.

It seems like an easy enough thing. I must be missing something.

[ivor_martin]

Hi,

Have you checked the flag to "Exchange Tax code during Write-Off" in the following configuration?

Define Tax Calc. Types in Write-Offs and Ind. Val. Adj.

Regards,

Ivor M.

[Former Member]

Hi Ivor,

I did.

But since the tax code is not being changed (the original tax amount should be debited when we write off), in the "Define change in Tax Code for Write - off", I entered the same tax code.

Ivor,

In the menu "Tax Adjustment for Write off" on the flag " No Tax Adjustment", I have tried this with both the flag on and off.

many thanks..

[william_eastman]

Chris/Jay:

Posting area 0120 controls the general ledger account to which the main receivables are written off.

PA 0121 is only relevant for some countries.

PA 0122 controls whether tax item is written off against its general ledger or whether it would be written off against the main receivables gl as defined in 0120.

As such, you should have PA 0120 defined with the main account (the account for the 900) and should have PA 0122 entries with the flag empty.

Beyond that, you should check your events - 5070 is designed for tax changes and maybe there is something entered there.

regards,

bill.

[Former Member]

Thank you Ivor and Bill. The problem is now solved.

It was indeed a silly thing.

Under "Tax Adjustment for Write Off" you have to specify the tax codes individually.

Using an Astrix to denote all tax codes does not work.

Once I made an entry for each company and each tax code, it worked.

[Former Member]

Under "Tax Adjustment for Write Off" you have to specify the tax codes individually.

Using an Astrix to denote all tax codes does not work.

Once an entry was made for each company and each tax code, it worked.