gr/ir clearing account maintanance

[Former Member]

what is gr/ir clearinfg account maintanance? plz tell me in your words only.

[Former Member]

Dear Nithin,

As i am given below about Gr/Ir account and also steps how to do hope this infirmation helps you

As you know the Gr/Ir account is a provisional account which is used when T code MIGO(Goods Receipt) and MIRO(Invoice Verification) happens.

In case of Goods Receipt scenario the vendor invoice is not received and the system takes the value from the PO.

Similarly in case of MIRO when the vendor invoice is received GR/IR account is Debited and the Vendor Account is credited. So ultimately the GR/IR account should be nullified.

In case the purchase value is accounted in Company code currency(Local Currency) there will not be any difference in both Dr and Cr balance of Gr/Ir account and if u will go to claer it there will not be any difference.

However in acse the PO is in Foreign currency ther may be difference in GR/IR account due to different Foreign Exchange rate.To avoid this situation when the G/L account is created in T code FS00 the box (Only balance in local currency) should be ticked so that while going for clearing there will not be any difference

The normal sequence of business activities for procurement is as under:

1. Purchase Order is created - No accounting entries are posted.

2. Goods are received from Vendor. The accounting entry will be as under:

Dr. Inventory A/c.

Cr. GR/IR A/c.

3. Invoice is received from Vendor. The following accounting entry is posted:

Dr. GR/IR A/c.

Cr. Vendor A/c.

4. When payment is made to Vendor - the accounting entry will be:

Dr. Vendor A/c.

Cr. Cash / Bank A/c.

When GR/IR clearing is done the entries posted to GR/IR Account in step 2 and 3 will get knocked off. A debit and a credit are cleared, and a clearing document is posted. This clearing document will not have any line items.

GR/IR Account is managed onm open item basis and this is a good control mechanism to monitor pending invoices.

Hope this helps you

Prem.

[Former Member]

GR/IR account is used for automatic posting. This helps in satisfying the double entry principle and helps in flow of financial transactions. For example take this scenario. Goods are received invoice not yet raised. At this point you need to record inventory but cannot credit to vendor account. Then the following entry is passed using clearing account

Dr Inventory Cr GR/IR account

when invoice is raised the following entry is passed.

Dr. GR/IR account Cr. Vendor

If any balance in GR/IR account indicates goods received but invoice not raised and shown as liability in the liabilities side of the balance sheet.

[former_member459660]

The GR/IR clearing account is used for clearing goods receipts and invoices.In case of differences between goods receipts and invoice receipts,some items remain open on GR/IR clearing account.If further deliveries,return deliveries,invoices or credit memos do not clear a quantity difference for a purchase order item,you have to maintain the GR/IR clearing account for this item.

The GR/IR clearing account is cleared for a purchase order item when the delivered quantity and invoice quantity are the same.

Before maintaining GR/IR clearing account you should establish that no further goods receipts or invoices are expected for the purchase order item

Clearing GR/IR clearing account is usually performed periodically,or at the end of the fiscal year,for those PO items for which no further goods receipt or invoice receipts are posted.

if quantity differences between the goods receipts and invoice receipts for a purchase order item are cleared using account maintanance,the system generates an account maintenance document

hope this will help you

REGARDS

SHYAM.R