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In Co, we create Recon accts to keep Fi gl in balance with CO.

Not all transactions affect FI gls, best example of it is internal order settlements, they use secondary cost elements and does not affect your G/l accts. To update FI side of it we maintain recon accts. These are primarily for cross company, cross functional and cross business area transactions. The number of recon accts to be defined is dependant on various factors, like how your management wants to see the reports.. whether they want to classify the cost based on CO object class or by Co types etc.. However the basic config you got to follow is: 1. Activate Recon accts (if you have created CO area newly, it would be active). use T.code: KALA 2. Assignment of Recon document type to the Controlling area. T.code: OKKP 3. Creating clearing accts (that you want to us! e for reconciliation. During FI-Co recon.. inter company clearing accounts will be automatically credited or debited and now you need to create offset acct which will show up in P&l acct). Acct determination set up thru T.code: OBYA 4. Maintain accts for Automatic Recon posting. T.code OBYB 5. Assign Number ranges to Recon activity. Tcode OK13

Reconciliation Accounts are created to keep FI-GL in balance with CO. Since not all transactions affect GL an example could be Internal Order Settlements which use secondary cost elements and do not affect G/L accounts, in order to make these affect the FI side we maintain reconciliation accounts. These are primarily used for cross company, cross functional and business areas transactions that is why the number of these type of accounts is defined dependant on the factors how you management departments wants to see the reports, how they want the cost based object class to be classified in CO or by Cost Object types and more. The basic configuration that must be followed is: 1. Activate Reconciliation Accounts. (Customizing -> Controlling -> Cost Element Accounting -> Reconciliation Ledger ->Activate/Deactivate Reconciliation Ledger) T.code: KALA 2. Assignment of Recon document type to the Controlling area. T.code: OKKP 3. Creation of the clearing accounts to be used for reconciliation. During the FI-CO reconciliation intercompany clearing accounts will be automatically credited or debited so an offsetting account needs

to be created which is the one that will show up on the P&L accounts. Account determination is made through T.code:OBYA 4. Maintain accts for Automatic Reconciliation posting. T.code OBYB 5. Assign Number ranges to Reconciliation activity. Tcode OK13

CO FI Ledger Reconciliation
When allocations are made within Controlling, they might post to two cost objects or two cost centres that belong to different company codes. In legal terms, one company code has charged cost to another company code. Since this allocation occurs in Controlling, the legal impact of cross company allocation is required to be reflected in Financial Accounting.

Without SAP new GL, business users are required to execute a period end job to reflect this posting in Financial Accounting.

With new GL, SAP posts documents in Financial Accounting simultaneously with the cross company allocation posting in Controlling. The obvious advantage of this is faster period end close because users do not have to execute the period end job to reconcile the ledgers. New GL ensures integrity of data between the two ledgers is maintained throughout.

What am I demonstrating?
I will demonstrate how new GL handles COFI reconciliation. As an example, I will process a cross company code cost centre allocation in Controlling. This posting should generate a real-time cross-company posting in Financial Accounting.

Assumptions for this blog


One of the pre-requisites is that SAP new GL is active. It is not essential to have document splitting active; for the purpose of this blog document splitting is active. All configuration steps documented in blog SAP delivered preconfiguration for document splitting in SAP new GL are configured for the demonstration in this blog. Profit Centre 1300 is assigned only to Company Code V001 and Profit Centre 5001 is assigned only to Company Code V005. I will demonstrate COFI Real-Time Integration for a cross-company code posting. The similar logic and configuration step applies to cross profit centre, cross functional area, or any of the other new GL scenario.

SAP new GL design driving COFI Reconciliation


The below configuration has to be done to enable COFI reconciliation.

Define Variants for Real-Time Integration Assign Variants for Real-Time Integration to Company Codes Define Account Determination for Real-Time Integration Define rules for selecting CO Line items Transfer CO Documents retrospectively

Define Variants for Real-Time Integration


Here we define parameters for Real-Time Integration.

Select the indicator to activate Real-Time Integration Key Date: is the date from when the Integration is active. If you decide to put a date in the past, you can execute Transfer CO documents retrospectively if no transfer was made previously. It is recommended that you put the key date as the first date of the next fiscal period. Account determination: This will use the account determination rules, which you will configure in the next step, to post the accounting entry in Financial Accounting. It is recommended that you always select this indicator. If you do not select this indicator, and

Post an allocation using a primary cost element, SAP will use that GL account to post back into FI. Post an allocation using a secondary cost element, SAP will not post an entry back into FI. Assign Document Type for COFI Reconciliation postings. Leave Ledger field blank. FI document will post to all ledgers. You could either select scenarios for which you want FI reconciliation documents to be posted; or use BAdI to select scenarios; or define Rules to select scenarios. You can, for example, select all cross-profit centre

documents (within the same company code) to be posted back to FI as well.

Avoid selecting transfer of all CO allocation Line Items or Trace this will impact performance of the processes. Variant for Real-Time Integration can be defined in IMG menu path

Financial Accounting (New) > Financial Accounting Global Settings (New) >Real-Time Integration of Controlling with Financial Accounting > Define Variants for Real-Time Integration

Assign Variants for Real-Time Integration to Company Codes


Variants for Real-Time Integration can be assigned by Company Code. Assign your variant to all Company codes within the Controlling Area. Assignment of Variant for Real-Time Integration can be defined in IMG menu path

Financial Accounting (New) > Financial Accounting Global Settings (New) >Real-Time Integration of Controlling with Financial Accounting > Assign Variants for Real-Time Integration to Company Codes

Account Determination for Real-Time Integration


There are two tables to be configured:

Define Intercompany Clearing Define Account Determination for Real-Time Integration

Define Intercompany Clearing


This is generally configured as a part of general Finance configuration. There is no additional configuration required here. When COFI Reconciliation posting is made in Financial Accounting, this table is used to populate the Inter Company customer and Inter Company Vendor account. You can check this configuration in IMG menu Path

Financial Accounting (New) > Financial Accounting Global Settings (New) >Real-Time Integration of Controlling with Financial Accounting > Account Determination for Real-Time Integration > Define Intercompany Clearing

Define Account Determination for Real-Time Integration


When COFI Reconciliation posting is made in Financial Accounting, this table is used to populate the COFI Reconciliation clearing account. You can define the COFI reconciliation GL account in IMG menu Path

Financial Accounting (New) > Financial Accounting Global Settings (New) >Real-Time Integration of Controlling with Financial Accounting > Account Determination for Real-Time Integration > Define Intercompany Clearing

Define rules for selecting CO Line items


You can define your own rules to determine which CO line items should be selected for transfer to Financial Accounting. You assign this rule in the variant for COFI Reconciliation. Selection of checkboxes in the variant is the standard way to activate the transfer; define rules only if you business process has special requirements (eg. certain cross company code postings should not transfer back to Financial Accounting).

Transfer CO Documents retrospectively


You would only need to perform this if you activate COFI Reconciliation retrospectively in the variant definition for Real-Time Integration.

Cross Company code Allocation in Controlling


I created a simple cross company allocation cycle to allocate IT costs from Cost Centre 1322 in Company Code V001 to Cost Centre 5001 in Company Code V005.

Once the allocation is performed, the system posts an entry into Controlling as shown below.

Costs are allocated from Company Code V001 to Company Code V005. This is a charge of costs across legal entities. Hence, the posting should reflect in the legal books as well. With COFI Reconciliation active and the tables configuration as shown above, the system has posted a cross company document in Financial Accounting as shown below.

The General Ledger view of the two documents in Company code V001 and V005 is shown below.

Conclusion
With new GL COFI Real-Time Integration functionality, users can now expect FI documents posted in real time for all cross company code (or any of the new GL scenarios) allocations in CO. This eliminates the need to perform period end job to transfer CO postings to FI and has greatly help reduce the period end processing time.