Utilization Postings in General: Online or Offline

The Accrual Engine facilitates a process known as Accrual Utilization, where the posting of actual costs, such as a supplier invoice or goods receipt, reduces previously posted accruals. This is represented as line items in journal entries, identifiable through the field “Subledger-specific Line Item Type Code” (ACDOCA-SLALITTYPE).

Accrual Utilization can be configured to happen in two ways:

1. Online: The Accrual Engine adds utilization postings as additional line items during the actual cost posting process, such as within a supplier invoice.
2. Periodic (Offline): The utilization posting occurs at the end of the period, performed by the periodic accrual posting run. The customizing indicator for this is called “Periodically”.

To directly reduce accruals when posting actual costs (e.g., supplier invoice), configure the following settings:

1. In the IMG activity “Assign Accrual Item Types to Journal Entry Types and Posting Schemas”:

• Assign transaction types UP (and optionally UL) to a posting schema.
• Set the “Post Online” indicator to automatically add utilization line items to the invoice or goods receipt. This will credit the cost account and debit the accrual account.

Note:

• You can set both “Post Online” and “Post Periodically” indicators. The system will not double-post the UP posting during the periodic accrual run.
• If the accrual amount is smaller than the costs that are posted for example by the invoice then only the corresponding partial amount of the costs will be posted as utilization posting.
• The rest is posted as costs.
• Technically speaking: The minimum of existing accruals and costs posted by the invoice or goods receipt is posted as utilization posting.

Posting Frequency and Posting Period

In the General Ledger, posting periods are determined by the fiscal year variant associated with the combination of company code and ledger. The Accrual Engine offers more flexibility by supporting various posting frequencies beyond those defined by the fiscal year variant.

In the IMG activity “Define Accrual Item Types,” you can specify a Posting Frequency. By default, this frequency is set to “By Posting Period,” which aligns with the fiscal periods used in the General Ledger. This is generally recommended.

However, you can also set different frequencies such as Daily or Quarterly. Therefore, the term “Period” in the context of the Accrual Engine refers to the period defined by the posting frequency of the accrual item type. To differentiate it from the General Ledger period (which is always the fiscal period), this period in the Accrual Engine is called an “Accrual Posting Period.”

This means that the Accrual Posting Period can vary (e.g., daily, fiscal period, quarterly), unlike the fixed fiscal periods used in the General Ledger.

When using the “plan minus actual” approach to calculate accruals, actual cost postings (e.g., invoices) can only utilize accruals from previous accrual posting periods. They cannot utilize accruals from the same or future periods. Instead, the periodic accrual posting run at the end of the current or future periods will reduce the accruals as a regular periodic accrual posting (transaction type PP), following the formula:

Accruals = Cumulated planned costs – Cumulated actual costs

As actual costs increase due to postings like invoices or goods receipts, the accrual amount decreases accordingly.

Relevant dates in journal entries determine which accruals can be utilized:

• For posted accruals, the Accrual Value Date is used, which by default is the posting date. However, if a different posting period is manually entered in the periodic accrual posting run, the posting date is derived from this manually entered period.
• For actual cost postings, the Posting Date is used, which determines the period.

This ensures that the correct accruals are utilized based on the relevant periods.

Additional Currencies: Online AND Offline:

Accrual Utilization postings can be configured to occur either:

• Online, during the posting of actual costs (e.g., invoices or goods receipts), or
• Periodically (“offline”), typically at the end of the period, through the periodic accrual posting run.

By the end of the period, exchange rates may differ from those used during online utilization postings (e.g., when invoices or goods receipts were posted). However, the amounts posted through online utilization should remain unchanged during the periodic accrual run.

To achieve this, configure the Accrual Engine to calculate accruals only in the transaction currency by:

1. In the IMG activity “Assign Currency Types to Accrual Item Types,” set the Currency Handling to “By Accrual Engine” for the transaction currency only.
2. In the IMG activity “Assign Accrual Item Types to Journal Entry Types and Posting Schemas,” set the “Post Deltas” flag for the accrual item type ACCRL.

Reason: The online utilization posting calculates the utilization amount in the transaction currency, so a re-calculation at period end will yield the same result in this currency, with a delta of zero. Consequently, the periodic accrual run will not post any delta.

Note: A full posting would reverse the online utilization posting and repost the full amount, leading the General Ledger to calculate additional currencies, which would be incorrect. Due to these constraints, utilization postings must be configured as delta postings.

Accrual Utilizations: First Come First Served (FCFS)

When accruals are utilized by posting actual costs (e.g., through a supplier invoice), the Accrual Engine uses a First Come, First Served (FCFS) logic. If multiple actual cost postings occur within the same posting period, the Accrual Engine sorts these postings based on their timestamp.

The earliest actual cost posting, based on its CPU date and time, will utilize accruals first. Subsequent actual cost postings will utilize accruals only if there are remaining accruals available.

Recommendation: Use Delta Postings

in the IMG activity “Assign Accrual Item Types to Journal Entry Types and Posting Schemas,” set the “Post Deltas” indicator for all transaction types.

Reasons:

1. Clarity: Delta postings make the amounts in utilization (UP, UL), manual release (RP, RL), and automatic release postings (FP, FL) easier to understand.
2. Efficiency: For periodic accrual postings (PP), delta postings are logical because utilization postings already reduce existing accruals, eliminating the need to reverse them in the next period.
3. Currency Valuation: A foreign currency valuation should be performed for the accrual account, which will update the accrual balance in other currencies to the latest exchange rate regardless.