Accrual/Defferal

[Former Member]

Hello Sap Guru...

I have confusion regarding accrual/Deferal posting. Accrual/ Deferal is like expense due but not paid or paid in advance M I right? if so when we post Accruals In FBS1 we give full amount right. like insurance paid for whole year is 12000 so will ente 12000 in FBS1 and at the time of reversal it will reverse with 12000 amount. so how do I post month expense for that period

I have treid with Accrual Engine but its also giving some error.

Please any guidance on this

thanks a lot

Regards

Pooja

[Former Member · Accepted solution]

The principle of posting an accrual is to recongnize the expenses for services that have been delivered by the vendor for which no payment has been made yet. Accruals need to be posted every month based on the amount of services (or materials) received which are outstanding to be paid.

So in the first month if you have an 1200, then you post an accrual for 1200 as of the last day of the month. The accrual is reversed automatically as of the first day of the next month because 1200 is no longer relevant for the second month. Depending on the exact amount outstanding at the end of the month you post another accrual (may or may not be the same as 1200) depending on how much more services have been received or how much money has been already paid.

Accrual is not posted for money paid in advance, which is done using down payment functionality.

Hope this helps.

Sharabh

[Former Member]

Hi Pooja,

To show the P&L a/c properly at the month end all expenditures during the month identified and posted as accrual docs. on 1st of next month we reverse these postings and when we pay these expenses we will reverse these accruals and post expenses as usual.

You can do the Accrual Posting for the Year End as well in the same way as you do for month end. But You have to reverse the Year end postings in special Period as the Year will be closed.

Regards,

Satish Muvva.

[Former Member]

Hi Sharabh & Satish

Thansk a lot for reply. I think I have misunderstood the Accrual concept only. I was thinking that If i had paid in advance for ex for insurance 12000 for year and now i want to divide it in every period i can do that by accrual..

Thanks a lot

will try to cee the other side of this as you people have explained..

Thansk

Have a nice day

Regards

Pooja