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Former Member

some open item queries

hi,

i read about open item management and now have few queries.

1) account meant for open item manged only for clearing account?

2) i read this 'when you activate open item field in the Gl it means those accounts need to be cleared at the month end'.

my question is for clearing account then i quite agree but what about customer and vendor account in point 3? how to clear at month end?

3) i read the follows. what does it mean 'automatically set for customer and vendor account?

You can only clear open items that are posted to accounts that

are managed on an open item basis. Open item management is

automatically set for customer and vendor accounts. For G/l

accounts, however, you have to set the open item management

option in their master record yourself. Open item management

would usually be set for the following G/l accou

thanks

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  • Best Answer
    Posted on Aug 29, 2007 at 02:05 PM

    > 1) account meant for open item manged only for clearing account?

    <b>Not necessarily, Any account, where you expect the balance to be zero at some point of time or those accounts, where you expect contra entries. i.e for every debit entry, if you expect a credit entry with equal amount, this account can qualify for open item managed. The open item management, is meant for better managing of accounts. GR/IR account is a classic example. First when goods arrive, the GR is credited, later when invoice come for the same goods receipt, this account gets debit.</b>

    > 2) i read this 'when you activate open item field in the GL it means those accounts need to be cleared at the month end'.

    <b>Not mandatory, Nevertheless, it can be a good practise.</b>

    > my question is for clearing account then i quite agree but what about customer and vendor account in point 3? how to clear at month end?

    Vendor and customer account usually gets cleared automatically when payment is recieved or paid. If not done at the time of receipt, this may be done at period end. For vendors and customer who has not been paid or received, you cannot clear those account. The open items will remain and should be so.

    > 3) i read the follows. what does it mean 'automatically set for customer and vendor account?

    >

    > You can only clear open items that are posted to accounts that are managed on an open item basis. Open item management is automatically set for customer and vendor accounts.

    <b>Vendor and customer accounts are sub-ledgers, They are not main GL. An account opened in these sub ledgers, automatically come with the feature or open item managed. Because, it is always expected the their accounts will be brought to zero, as soon a particular transaction is completed.</b>

    > For G/l accounts, however, you have to set the open item management option in their master record yourself. Open item management would usually be set for the following G/l account.

    <b>See comments for the first item</b>

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  • author's profile photo Former Member
    Former Member
    Posted on Aug 29, 2007 at 01:56 PM

    to answer your question

    1). Open item means clearing accounts

    2) the open item accounts need to be cleared at the month end. The vendor and customer account are not open item managed but reconciliation accounts, Its the same with little difference.

    3)That why it say that it is automatically set for customer and vendor accounts. that means when you define your gl accounts as reconcilation accounts for vendor or customer it is automatcally set for open item

    You can clear all the open item gl account, vendor, customer using F.13.

    Assign points if helpful

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  • author's profile photo Former Member
    Former Member
    Posted on Aug 29, 2007 at 01:56 PM

    1. open a/c's r for clearing only. these r accounts which are used to update the main a/c. these gl's r a bridge to the main GL a/c therefore they r treated as open

    2. it depends on the company policy. the open items for customer/vendor always move to the next period if not cleared. at the end of the year the balances r moved to nx fisacl year also.

    3. customer/vendor a/c's r recon accounts and all the postings to the main GL go thro customer/vendor number (subledger) so they r automatically open items... the main GL doesnt have the tick for open mgmt but it gets handles from the sub ledger level..

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  • author's profile photo Former Member
    Former Member
    Posted on Aug 29, 2007 at 01:57 PM

    Hi,

    1. First point to note that Customer and Vendor Accounts are by default created open item managed accounts in SAP. There is no hard and fast rule that they need to be cleared at month end. Following the accounting concept - On going entity, the Business goes on infinitely, so nothing like clearing by month end.

    There will be lot of Customer / Vendor items not due at month and these will remain as open items. Similarly, there may be Customer items which are over due but not paid, such items remain as open items.

    2. A few GL Accounts are created as Open Item managed GL Accounts like GR/IR clearing account / Bank Clearing account / Accruals accounts / Prepaid expenses etc.,

    Yes, the open item managed accounts need to be cleared but mandatory that it has to be cleared by month end. As an example if goods are received but no invoice is received, it cannot be cleared.

    Thanks

    Murali.

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