Document Splitting for Subsequent Processes

Document Splitting is the one of the key functionalities of SAP FI and CO. The prime objective of Document Splitting is to generate reports for objects below company code level, such as Profit Centers and Segments.

Document Splitting works in background in real time when financial transactions are posted by end users regularly, and the split line items are displayed only in GENERAL LEDGER VIEW of the document.

Subsequent processes in SAP FI are those activities performed subsequently on the posted documents are posted such as posting cash discount at the time of payment, posting unrealized foreign currency gain or loss at month-end during forex valuation run, realized foreign currency gains or losses when the payment is made to vendors or received from customers.

Document Splitting program creates additional line items when performing the below activities.

• Clearing of Vendor/Customer Items

• Cash Discount Paid

• Cash discount received

• Lost cash discount

• Clearing of open items

• Realized exchange rate differences

• Foreign currency valuation for open items

• Expenses/profit from foreign currency valuation

• Flat-rate individual value adjustment for vendor/customer items

• Expenses/profit from individual value adjustment

The above processes are classified as Document Splitting for Subsequent Processes and configured under the Document Splitting settings of Controlling module.

It is usual practice to activate the Document Splitting for Profit Center and Segment in SAP FI under the node IMG > Financial Accounting > General Ledger Accounting > Business Transactions > Document Splitting > Define Document Splitting Characteristics for General Ledger Accounting

SAP also provides an additional feature where you can further split the line items for subsequent processes noted above. To do so, visit the node IMG > Financial Accounting > General Ledger Accounting > Business Transactions > Document Splitting > Define Document Splitting Characteristics for Controlling. Enter the cost objects on this screen for which the further splitting is required on subsequent processes.

Further, activate the splitting for subsequent processes by each cost object by entering Transaction SM30 and enter Table V_FAGL_SPLIT_FL2. Click Edit button to enter the screen.

Tick the check box for each subsequent processes against the cost object to enable further splitting.

Document Splitting for Cash Discount Clearing

At the time of posting invoice the document was split on vendor line items (also applies for customers) based on Profit Center and Balance Sheet accounts such as Tax and Vendor Recon accounts were substituted with Profit Center derived from cost object on expense line items. When posting payments to vendor, line item for realized cash discount is further split based on the inherited cost objects from the invoice. Once the realized cash discount is posted, the document splitting process ends here. No additional lines are created in CO module in Table ACDOCA.

Document Splitting for Realized Exchange Rate Differences

When the vendor invoice posted in foreign currency is paid before due date and the cash discount is earned under the terms of payment, the cost objects on cash discount received is derived from FAGL3KEH, (if the cash discount is granted to customers the cost object is derived from OBK9). If the cost objects are activated for further splitting, the amount on realized exchange rate differences is further split where two or more expense lines with unique profit centers (derived from cost centers) were posted on the original invoice. The split ratio is as derived as per the amount posted on each cost object/PC on original invoice. If the invoice has only one expense line item with one cost object, further splitting is posted with zero value in CO module and is visible only in GL view of the document.

Most often, businesses do not want to split the realized exchange rate differences into multiple lines. Hence, activate this check box only if your business needs it.

Document Splitting for Valuated Exchange Rate Differences

The valuated exchange rate differences resulting from forex valuation run on Subledgers and General Ledger at month-end can also be split further based on original invoice/payments.

I hope this article helps you understand the document splitting config for CO. Thank you for reading.