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CENVAT Adjustment Postings (J1IH – Excise JV)

Use: - You use these functions if you need to make an adjustment posting to any of your
CENVAT accounts. You can make adjustment postings to account for:

• Scrap
• Materials that you have not used in production
• Additional excise paid by vendors
• Money that you have transferred to your personal ledger account
• Other transactions

You can also use this function to cancel excise invoices.

Features: - Each of the different types of adjustment postings are documented separately.
However, they all work on the same principle, as follows.

Reference Document: - On the initial screen of the transaction, you specify the reference
document, that is, the document which the adjustment posting is to refer to – either
an internal document, such as a material document or a subcontracting challan – or an
external document, such as an incoming excise invoice

You also specify which registers are affected by the posting. In many cases, the
adjustment will have to be remitted to the authorities on a fortnightly basis. The
adjustment will then be included when you run the Remittance of Excise Duty
Fortnightly report. If the adjustment has to be remitted immediately, you specify which
register is affected.

Excise Details: - When you proceed to the detail screen, the system automatically shows
the line items from the reference document, if it is an internal document. You
specify how much excise duty is to be adjusted and which CENVAT accounts the
adjustment posting is to be made to.
When you edit the excise details, there are a number of functions that are available,
depending on the type of adjustment posting:
• Assigning excise invoice to line items
• Specifying which G/L accounts are to be adjusted
• Displaying balances of CENVAT accounts
When you save your changes, the system creates an accounting document to make the
appropriate postings.

1. Making Adjustment Postings for Scrap


Use: - You follow this procedure if you have scrapped a material and want to reverse the
excise duty debited to your CENVAT account.
Procedure: -
Matl write-off.◊ Create ◊1. J1IH - Excise JV
2. Enter data as required, including:
• Document number (This Document is of Movement Type – 551 i.e. GI for Scrap)
Enter the number of the document that you used to scrap the material.
• CENVAT account selection group box
Specify which account is affected by the adjustment posting is for. If the posting does not
have to be remitted immediately, select Fortnightly payment.
3. Click on “Enter” button.
The system displays the information from the material document.
4. Adjust the posting date as necessary.
5. Adjust the excise duty for each line item either:
• Manually
• By assigning the line item to an excise invoice
6. Specify which G/L accounts are to be posted to.
Here you can change Debit A/c as per your requirement.
7. Save the adjustment posting.
System will post Excise JV Document, Accounting Document Part2 Serial No.

2. Making Adjustment Postings for Materials Not Used in Production


Use: - You follow this procedure if you have not used a material in the production
process and want to reverse the excise duty debited to your CENVAT account.
Procedure: -
1. J1IH ? Excise JV ? Create ? Matl non-prod.
2. Enter data as required, including:
• Document number
Enter the number of the material document that the adjustment posting is to refer to.
• CENVAT account selection group box
Specify which account is affected by the adjustment posting is for. If the posting does not
have to be remitted immediately, select Fortnightly payment.
3. Click on “Enter” button.
The system displays the information from the material document.
4. Adjust the posting date as necessary.
5. Adjust the excise duty for each line item either:
• Manually
• By assigning the line item to an excise invoice
6. Specify which G/L accounts are to be posted to.
Here you can change Debit A/c as per your requirement.
7. Save the adjustment posting.
Excise JV Document, Accounting Document with Part2 Serial No has been successfully
created

3. Making Adjustment Postings for Additional Excise Paid by Vendors


Use: - You follow this procedure if a vendor has increased the amount of excise duty that
it originally charged you and you want to debit the difference to your CENVAT account.
Procedure: -
1. J1IH ? Excise JV ? Additional excise
2. Enter data as required.
In the Document number field, enter then number of the document sent to you by the
vendor.
3. Click on “Enter” button.
4. Adjust the posting date as necessary and Enter Vendor Name.
5. Enter the amount of excise duty in either of the following ways:
• To enter line items for different materials and the excise duty accordingly, choose
“Details” button and enter the line items in the table.
Here Enter Material code, quantity as per excise invoice, reference document (i.e. GRN
Document), batch no., BED and Ed Cess Amount to be posted.
• To enter the excise duty only, choose “Header” button and enter the excise duty in the
totals fields at the foot of the screen.
6. If the duty qualifies as countervailing duty (CVD):
a. Select CVD applicable.
b. Enter the CVD amount in the BED amount field.
7. Specify which G/L accounts are to be posted to.
8. Save the adjustment posting.
System will post Excise JV Document; Accounting Document with Part2 Serial No has
been successfully created.

4. Making Adjustment Postings for Money Transferred to PLA


Use: - You follow this procedure to make an adjustment posting when you transfer
money to your personal ledger account (PLA).
Prerequisites: - You have already transferred the money to your PLA at the bank, using a
TR6 challan, and have posted the corresponding accounting document.
Procedure: -
1. J1IH ? Excise JV ? TR6 challan.
2. Enter data as required, including the document number.
You can enter either the challan number OR the number of the accounting document
(This document is to be first created through T. Code – FB50. In this Document Debit

PLA on Hold A/c and Credit Bank A/c with the Amount to be transferred in PLA
CENVAT Accounts)
3. Click on “Enter” button.
If you entered the accounting document number, the system displays the information
from it.
4. Enter the amounts against the accounts that you require.
5. Save the adjustment posting.
6. System will post Excise JV Document; Accounting Document with Part2 Serial No has
been successfully created.

5. Canceling Excise Invoices


Use: - You follow this procedure in order to cancel an outgoing excise invoice. It reverses
any excise duty accounted for.
Procedure: -
1. J1IH ? Excise JV ? Cancel exc. inv.
2. Enter the number, year, and series group of the excise invoice that you want to cancel.
A dialog box appears.
3. Choose Yes.
4. Before posting the document check the Accounting document going to be generated.
Here click on “Determine G/L Accounts” button.
5. Save the adjustment posting.
System will post Excise JV Document; Accounting Document with Part2 Serial No has
been successfully created.

6. Making Adjustment Postings for Other Transactions


Use: - You follow this procedure if you want to make an adjustment posting that does not
fall into any of the other categories of adjustment offered by this function. You can only
use an external document as your reference document.
Procedure: -
1. J1IH ? Excise JV ? Other adj.
2. Enter data as required, including:
• Document number
Enter the number of the external document that you want to refer to.
• CENVAT account selection group box
Specify which account is affected by the adjustment posting is for. If the posting does not
have to be remitted immediately, select Fortnightly payment.
3. Click on “Enter” button.
The system displays the information from the material document.
4. Adjust the posting date as necessary and enter Vendor code as per requirement.
5. Enter the amount of excise duty in either of the following ways:
• To enter line items for different materials and the excise duty accordingly, choose
“Details” button and enter the line items in the table.
Here fill details like Material Code, Quantity as per Excise Invoice, Batch No, Reference
(i.e. GRN Document), BED and Ed Cess Amount manually.
If you want system to propose the BED and Ed Cess Amount, Click on “Get Excise
Invoice” button and select the proper Excise Invoice from which the proportionate
amount is to be copied.
Select the “Excise Invoice” and click on “Continue” button.
It will copy BED and Ed Cess and SECess amount as per the quantity mentioned here. It
will be proposed in proportion of selected Excise Invoice quantity and value.
• To enter the excise duty only, choose “Header” button and enter the excise duty in the
totals fields at the foot of the screen.
6. Specify which G/L accounts are to be posted to.
7. Save the adjustment posting.
System will post Excise JV Document; Accounting Document with Part2 Serial No has
been successfully created.
TIPS to simplify Excise JV transactions: - (J1IH)

1. Assigning Excise Invoices to Line Items


Use: - When you make an adjustment posting, you follow this procedure if you want to
specify the original excise invoice associated with a line item.
Procedure: -
1. Select the line item that you want and choose Get excise invoice.
The system displays a list of all the excise invoices that you have posted from this vendor
for this particular material.
2. Select the excise invoice that you want and click on “Enter” button.
The system:
• Enters the excise invoice document number in the Ref. doc. field (Reference document).

• Calculates how much of the excise duty from the excise invoice should be apportioned
to the line item and enters it in the excise duty fields.
If you then overwrite these amounts, you should also overwrite the reference document
number with an explanatory text, since there is no point in maintaining the link to the
reference document anymore.
For e.g. you have a line item with ten plates of glass that you have broken and are to be
scrapped. You have three excise invoices from the same vendor to choose from.

You pick one for 20 plates of glass with BED at INR 200. The system automatically
apportions INR 100 to the line item that is to be reversed.

2. Specifying Which CENVAT Accounts to Adjust


Use: - When you make an adjustment posting, you have to specify which CENVAT
accounts are to be adjusted.
Procedure: -
1. Choose Determine G/L accounts.
A dialog box appears that shows how much will be posted to which G/L accounts. The
accounts that are displayed depend on the excise group and the CENVAT account that
you entered on the selection screen.
2. Add another account, if you need to, and adjust the other postings so that the credits
and debits match.
3. Enter a business area and cost center, if necessary.
4. To close the dialog box, click on “Enter” button.

3. Displaying CENVAT Account Balances


To display the balances of your CENVAT accounts, choose Balances.
The system displays the balances only of the CENVAT accounts that are affected by your
G/L postings.
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