COA mapping and funds

[atif_farooq]

Hi:

Client is having 5 types of funds which can be used for differing purposes in finance. These funds are current funds, endowment funds, chair funds,fixed asset funds & chair funds . There existing COA is based on this classification. Eg. a GL account for travel expenses is created five times representing each funds i-e if current funds are represented by 1 then GL account for travel expenses will be created as 831000 . Here 1 is representing that this GL is from current funds, likewise this GL will be created 4 times more for other fund categories with differing coding structure.

Client is not using budget structure and will use bottom up budgeting , so budget structure will not be used.

In new COA i am thinking to make use of additional FM account assignment in FM-BCS. Funds will be enabled. Accordingly funds will be created for all these five types.Further more these funds are divided into restricted, unrestricted and temporary restricted. To cater these i can make use of fund types. Is this approach fine enough to map their requirement in system.

Regards

[iklovski · Accepted solution]

Hi Atif,

These 'funds' are they budgetary or accounting business objects? If they are budgetary objects, then creation of 5 G/L is completely useless. Even without PSM-FM, creation of 5 G/Ls for a single accounting line does not make sense as there are other ways (CO objects) to distinguish between the postings.

For budgetary purposes, using 'fund' object is perfectly fine. You just have to think how the information for the fund will be entered in the document. Will the users enter it manually or will it be derived based on some accounting parameters?

Regards,

Eli

[atif_farooq]

Hi Eli:

I just discussed with relevant stakeholder, he pointed that this classification is basically accounting reporting requirement. Hence these funds types are accounting objects . If you could look at the screen shot attached of the their legacy P&L , they report expenses and revenues on these funds types basis and hence they have opened a GL 5 times .I could have made use of these fund types as CO object but problem is that there are around 70 further department for which they have further created GL for one category. 

I will cater their department wise reporting through controlling by defining cost center hierarchy and posting to them through FI but how to cater this fund type wise reporting. I am thinking of using some field like SGTXT to give them drop down of these funds types. I do not want to create a single GL 5 times for their reporting. Please share your comments.

Regards

[iklovski]

Hi,

Couldn't say that it's successful design to create 5 G/Ls. It could have perfectly treated by WBS, for example. Then, you can have perfect reporting in FI, CO and FM (if you choose to derive FM object, say fund, based on WBS). I don't like working with text fields, e.g. SGTXT without special need.

In any case, if they have 5 G/L, no special need for you to use funds in BCS, as you may have 5 different CI and therefore budget and report on them separately.

Regards,

Eli

[atif_farooq]

Yes you are right Eli but unfortunately PS is out scope and we can not use WBS. How about using business area for meeting this requirement?

Regards

[iklovski]

Business area is a possibility, but how it will be derived? It should be from some cost object or entered manually each time. You know, that using PS only for FI purposes does not impose serious implementation, only basics. Internal order could be another possibility.

[atif_farooq]

Hi Eli:

Thanks for the continued feedback. Well we have decided to use business area since PS is out of scope . So i think i will have to resort to Business area option. I have enables business area and have posted an invoice in FB60 but in vendor line item Business area is no getting updated automatically. What can be reason?

Screen shoot is attached

Regards

[iklovski]

Why would it? Do you have new G/L and automatic splitting on business area? For classic G/L, it will come only with adjustments (like for profit centre). Anyway, it's FI issue and not connected to PSM.

[Former Member]

Hi

I have few doubts on your issue, Have you entered business area in vendor line item or not? , also check recon a/c field status group business area make it mandatory. Other wise generally Business area will show in vendor line item.

Correct me if I am wrong.

Regards

Rao

[atif_farooq]

Hi Rao:

Yes it will automatically get updated in Vendor or customer line item. Once you assign BA to expense line item in FB60 or any other posting. It is automatically updated in subsidiary ledger line items. Eg. if you assign business area in asset master , it will automatically be updated in all of its relevant transactions like depreciation posting, retirement , capitalization (here GRIR clearing account will be updated auto upon MIGO if you are procuring asset through MM ).

Regards