Initial Inventory Balance upload question

[Former Member]

Hello Experts,

I am aware of how inventory balances are uploaded via MB1C from MM side. I understand this process until the Inventory Ac is debited and the initial inv balance upload account is credited. My question is:

1. What happens to the balance in the initial inv balance upload account?

2. While uploading trial balances, will we load inventory GL balance? If yes, what will be the accounting entry? We cannot debit the initial inv balance upload account here to zero this out since it can be only posted by the system.

3. In international loacations, where the local currency is say, YEN, and we have a USD balance bank account which can only be posed in USD currency, how do we deal with such conversion? I know that it should be a separate header with USD currency and exchange rate.

The entry will be Bank USD A/C Debit

                              to Data Migration A/C Credit???

I hope to get answers soon. I have read all the related posts but couldn't find any answers.

Thanks

AL

[sanilbhandari · Accepted solution]

Hi

Please find the replies below:

1. Since you are loading the trial balance, the sum total of debits & credits on all the initial upload account(s) should ideally be zero. You can choose to have one or more than one initial upload accounts. There is no reason that the balance will not be zero, unless there is a difference in your legacy balances or you have not tallied the balances before upload or there is some initial error during your upload process.

2. When you upload using 561 movement type, the accounting entry should be

Stock/Inventory A/c Dr

      To Initial Upload A/c

The system would read the material master price for the plant and multiply the same with quantity of the material. This will be the value which will be updated as the stock value in the inventory account GL as well as stock balance in Materials Management.

3.You would have decided on some exchange rate to use for conversion of balances. So for the conversion date, please maintain the required exchange rate in your system or your upload template and SAP would post the balances correctly with your trial balance tallied out. The accounting entry mentioned by you is correct.

Thanks & regards

Sanil Bhandari

[Former Member · Accepted solution]

Thanks for answering my questions Sanil.

I agree to your answer to my 2nd question. Here, Will we exclude the inventory balances in trial balance then, since both GL and MM is posted?

For example: There are 100 units of inventory loaded with the std price of 2.00. The finished goods inventory GL will have a value of 200. and 399999(initial stock ac) is credited with 200. Now, we will have a value of 200 in the trial balance too. How to deal with this? Will we follow the same technique for inventory what we use for loading AR or AP open items? If possible, give an example to explain. Appreciate your timely response. Thanks!

[sanilbhandari · Accepted solution]

Hi

When you post an inventory upload through MB1C, it will post both GL and MM balances, so you need to exclude the same from other GL Balances during actual upload of GL Balances itself. But on the assets sides, when you are tallying the balances, you will include this GL(s) so that the trail balance ties out overall.

For eg, you have the following balances

Asset                                              Liability

AR 10000                                        AP 10000

Inventory 5000                                 Other Liability 5000

Accruals  2000                                 Tax Payable 2000

You will upload AP & AR as open items for customer and vendor. Now you will upload, other liability, Accruals and tax payable as normal GL Upload. For inventory, you will have to use MB1C with movement type 561. You will need to make sure that material master is created and extended to respective plant and unit price is maintained in material master. Now when you speciffy the qty in MB1C, the system will multiply the qty with the price and update both MM and FI Balances.

For tallying out the trial balance you will look at the over all trial balance as shown above as an example and it should tally out to zero.

Let me know if you have any further questions.

Thanks & regards

Sanil Bhandari

[Former Member · Accepted solution]

yyou mean when we load all the gl balances we exclude inventory in the load itself but consider it towards the calculation and balance will go in the data migration account. It will be more of a balancing figure. Right?

[sanilbhandari · Accepted solution]

Hi

I meant that the inventory GL Balances will be updated, when you execute MB1C using 561 movement type.

You should exclude it from normal GL Balance upload.

However, when you will reconcile the Trial Balance after all the updates have been made, you should include all the GL Accounts.

regards

Sanil Bhandari

[Former Member · Accepted solution]

Thanks Sanil for taking time and explaining.