1816316 - Supplier Invoice Accounted to Cost Object: Cash Discount Posted to Original Expense Account

• You create a supplier invoice accounted to a G/L Account or Cost Object, such as Cost Center, Lease Contract or Free Cost Object. 
• For this supplier invoice you create a payment, which, according to the payment terms, contains a cash discount. Alternatively, you maintain a cash discount manually in the payment / respective clearing. 
• You expect that the cash discount is posted to a separate cash discount account which you have maintained in Fine Tuning.
• Instead, the cash discount is posted to the original expense account of the accounted object. 

SAP Business ByDesign

Pre-condition:

In the Fine Tune activity Charts of Accounts, Financial Reporting Structures, Account Determination under Account Determination - Accounts Payable in the Payment Differences tab you have maintained a G/L account in column Cash Discounts Earned.

Steps to reproduce:

1. In the Supplier Invoicing work center create a new supplier invoice without purchase order.
2. Maintain a payment term that applies a cash discount. Alternatively, maintain a cash discount in the clearing manually.
3. In the Items tab of the invoice maintain the product, product description and the tax code.
4. In the Cost Distribution sub-tab, under Account Assignment choose an Account determination group in the G/L Account field. Or choose Account Assignment Type CC -Cost Center and enter the relevant cost center ID.
5. Now create an outgoing payment for supplier, either manually or automatically via a payment run. The cash discount either gets calculated automatically or you maintain it in the payment.
6. Finally, invoice and payment are being cleared, either automatically or manually from the Payables work center.
7. In the Journal Entry of the clearing you notice that the cash discount has been posted to the original G/L Account which corresponds to the account determination group maintained in the Cost Distribution, or derived from the account determination group assigned to the product category of the invoice item (if the invoice item was assigned to a cost center).
8. You expect the cash discount to be posted to the account that you have maintained for cash discounts earned in Fine Tuning under Account Determination - Accounts Payable.

In general, the cash discount postings depend on whether they are combined with a goods receipt.

1. Invoice receipt with goods receipt: The cash discount is posted through the GR/IR clearing activity.
2. Invoice receipt without goods receipt: The cash discount is posted to the original account in the journal entry for the supplier invoice, that is, to the expense account.

This posting logic is controlled by the settings maintained in the fine tune activity Posting Control Profiles for Procurement Processes.

However, it is possible to set up the posting control in a way that cash discounts are posted to a specific payment difference account maintained in the mentioned Account Determination activity.

Create a new posting control profile for procurement processes and assign it to the respective accounting principles:

1. In the Business Configuration work center open the Fine Tune activity Generally Accepted Accounting Principles (either with a change project or from the Implementation Projects view and here in the Fine Tune phase).
2. You might have to add this activity to the project - Choose Add to Project and then choose Open.
3. In the new window first go to the Posting Control Profiles for Procurement Processes task.
4. To create a new posting control  profile, copy the General Posting Profile: Choose Copy, change the Posting profile ID and the profile description.
5. In the sub-tabs underneath you can maintain the payment difference posting settings for three procurement options: Procure for Consumption, Procure to Stock, Procure to Fixed Assets.
6. If you do not want cash discounts to be posted to the original expense account, navigate, for instance,  to the Procure for Consumption tab (in regards to expenses accounted to cost objects) and  select 1-Cash Discount.
7. Untick the box in the Post to Original Expense Account column.
8. Press Save and Close.
9. Now open the task Generally Accepted Accounting Principles
10. In the new window, you can assign the new Posting Control Profile to the respective accounting principles.
11. Press Save and Close.

If you now create a supplier invoice, even without goods and service receipt then the cash discount maintained in the payment clearing will be posted to the cash discount account that you have maintained in the Account Determination activity in Fine Tuning.

2651325-Supplier Cash Discount Posted to Original Expense Account- Supplier Invoice with Purchase Order/ Goods Receipt

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