The following documentation explains the procedure and discusses various ways of eliminating intercompany profit of current assets.
By applying the 'ZU'-Parameter (KTKPAR-ZU), you control whether the function can only be performed inside this group or subgroup. In this case, the compulsory fields (Group, Period/Type of Data/Company for posting ZU) must be listed at the very least.
When you use this function for the first time, you must select the processing abbreviation -ZU+ in the -KTKPAR+ application in the field -ConsFunct+ from the selection list and have it displayed.The overview should be empty initially. The KTKPARZU individual overview will open up and the necessary data can be stored after you have pressed -Action+ and -Process data+.
Explanation of individual attributes:
[Company]: This attribute serves to define which company the elimination of intercompany profit should be posted under:
[Elimination]: optional entry of an elimination account (Posting tag =3) that the elimination amount is to be posted to. As long as no elimination account has been entered in the other applications of -ZU+ (-ICVOR+ / -PRO+), this account will be used during processing. This then applies for all companies and all IC stocks of the inventories of the group/subgroup. NOTE: If no account has been entered in either the application -ICVOR+ or -PRO+ or -KTKPARZU+, calculation of the elimination amount will come to a stop and an error message will appear: no elim. account, elim. not possible with (GES/GES/Product group) (KON0247E) .
[Carry forward]: an optional entry. If a different account than the general carry forward account is to be used for the ZU carry forward, a separate carry forward account can be entered here.
[Neutralization account1]: an optional entry. If -neutralization accounts+ are used, one such account can be entered here.
[Account for offsetting exchange effects]: an optional entry. If the exchange effect on the elimination amount is to be calculated and posted, a currency exchange effect account must be entered. If this field remains empty, no exchange effect on the elimination amount will be calculated.
The required product groups are to be set up in the application -PRO+ (Products/Product groups).
Explanation of individual attributes:
[Product group/No.] Name of the product group
[Product description]: Designation of the product group
[ChaAcc]: Allocation of the chart of accounts and an asset account on this product group.
[Account elimination]: an optional entry. As long as no elimination account has been entered into ICVOR, amounts will be booked to the elimination account entered here. This then applies for each product group. NOTE: If an exchange effect account is used, then an elimination account can be entered here for each product group. Different elimination accounts cannot be used per ICVOR to process exchange effects.
By using the function -Action- in the -PRO- application, you will be able to branch off into certain external applications, such as the application -ICVOR+ (IC stock inventories) or I-ICVOR (Form entry IC stock inventories) to attend to the necessary IC transactions.
If additional product-specific data is to be stored, other data can be stored in -PRODAT+ (Product data) for each product group application:
Explanation of individual attributes:
[Min.Pcosts]: Entry of a lower limit to manufacturing costs. This attribute is currently only of an informational nature, in other words it will not be evaluated at any point in processing. If, however, a lower limit has been entered, then it is absolutely necessary to enter an upper limit as well.
[Max.Pcosts]: Entry of an upper limit to manufacturing costs. This attribute is also currently only of an informational nature, in other words it will not be evaluated at any point in processing. If, however, an upper limit has been entered, then it is absolutely necessary to enter a lower limit as well.
[DirectPerc]: If a percentual additional charge or reduction rate has been entered, then this will be of a binding nature for this product group. If, however, a different additional charge or reduction rate than the one entered here has been entered in ICVOR for each transaction, then this will be used to calculate the elimination amount. With entry of an additional charge / reduction rate of 15%, for example, the calculation would be as follows: Value LW / 115%*15%. An additional charge or reduction rate may never be negative.
This table displays the declaration of intercompany profit + loss in inventories from the point of view of the supplying company. Previously, this declaration was only presented in conjunction with the IC stock levels in the intercompany profit + loss of the receiving company or, independent of the company with the subordinate +product data+ (PRODAT) contained in the master data. Now, both companies are able to make their declarations (current value or percent premium) for the elimination of intercompany profit + losses in current assets independent of each other.
This overview application 'Product Margin' can be found in the menu tree under the branch 'company development transaction' and can also be called up under the abbreviation 'PROMAR'.
The following order of priority applies to ascertaining the addition and discount values:
This means that if no additional value / discount value or additional percentage / discount percentage is declared in ICVOR, you will need to look up whether a PROMAR file exists before the PRODAT sentence is read. Please bear in mind that the rolls of company and IC company have been switched with respect to the tables ICVOR and PROMAR. If no additional or discount value can be determined because the supplying company did not attend to PROMAR, a respective error will be reported (the message text might change).
The PROMAR records are not automatically transferred into the next period, because it is assumed that the specified %-rate may change from year to year. By 'quantity copy', however, the previous data will be copied quickly to the next period.
IC Stock Inventories (ICVOR) can be entered in the application -ICVOR+ or -I-ICVOR+.
Generally speaking, all of the IC transactions on inventories will have already been entered at the company level. By branching off from out of the application -PRO+, using the abbreviation -ICVOR+ or the resource tree, you will enter into the application -Inventories IC Stocks- (ICVOR. The overview application -ICVOR- will provide you with an overview of all of the IC Inventory levels from the perspective of the receiving company.
The IC stocks of the inventories of the receiving company will be recorded in terms of its value. By entering additional/discount rates in % or an additional/discount value, the amount of the intercompany profit will be determined and defined by way of an optional entry in the elimination account for the posting -ZU+.
Explanation of individual attributes:
[IC-Comp]: Entry of the supplying company
[DirectPerc.]: by entering an additional/discount rate in %, the following calculation will be initiated with respect to the amount to be entered further below: Example: additional/discount rate = 15% , then the internal calculation takes place as: LW value / 115%*15%. A value needs to be entered if no other value has been stored in the -PRO+ application.
[OverhAmtGC]: Additional / Discount value for the group. If a specific amount is to be eliminated as a discount value, this value must be entered here in group currency.
[AmountLocC]: When entering an additional/discount rate in %, the underlying asset, in other words the value of the current assets that the receiving company purchased the current assets at, must be entered here. Conversion of LW into KW takes place automatically by way of currency conversion. ATTENTION: if the IC transactions are only managed at the group level , you will need to repeat currency conversion.
[Account elimination] : By entering an elimination account, the amount to be eliminated will be credited to the account that has been entered and the elimination accounts in -PRO+ and -KTKPAR+ will not be taken into account. If this field remains empty, the elimination account from -PRO+ will be used. If no account is entered there, the account from -KTKPARZU+ will be used. An elimination account can only be entered in ICVOR if you work without using a currency conversion effect account.
Calculation and posting of the amount to be eliminated can take place in three different ways
When executing the action from out of the group companies + monitor, please make sure that the companies for which a -ZU+ is to be completed have been marked in advance. -Elimination of current assets results+ means the -ZU+ is performed for all of this company+s ICVOR inventories. Individual processing of ICVOR for inventories is only possible via -ZWERGUV+ and then only if elimination is to take place without currency effects.
After the -ZU+ has been completed, you can branch off into ZWERGUV by way of the -Elimination of current assets results overview+ inside which the elimination of amounts are shown for each ICVOR and a consolidation voucher has been generated.
One special feature of -ZU- consolidation is that it can be initiated separately for any IC transaction with the help of the -ZWERGUV+ overview. In other words, ZVERGUV allows you to control whether consolidation only takes place for certain IC transactions and not for others. Nevertheless, this type of block processing is only possible as long as you are not working with a currency conversion effect account.
Analogous to other types of processing, consolidation is initiated via -Action+ + -Elimination of current assets results ZU+ or -Delete elimination of current assets results ZU+.
If you attempt to complete single block processing despite an entry in a currency conversion effect account, the error message 'Acc. for Curr.Diff. existing, no eliminat. for (GESxxx/#GESxxxx/#PROxxx),KON2228E' will appear and processing will come to a stop.During processing of -elimination of intercompany profit on current assets ZU+ all of a company's transactions will be processed simultaneously. Individual IC transactions can be deleted by performing -Delete elimination of current assets+.
Via the action -consolidation posting+, you will branch off into the overview -KONBUCH+ and be able to have consolidation postings displayed.
ZU-consolidation can now be controlled in an automated manner. If data exists for use in processing, it will be displayed for each company and can be processed either individually or completely by machine. Companies that have already been processed, in other words companies for which consolidation processing 'ZU' has already been initiated, will no longer be displayed by the machine.
To perform consolidation processing -ZU+, the desired company must be marked and the action is to be performed:
After returning to the group companies + monitor, the status screen will be displayed for those companies for which a ZU has been initiated.
The following data has already been entered:
Image: Data in KTKPARZU
Here, you must pay particular attention to the entry of the account for calculating the effects of currency conversion, due to the fact that no calculation of currency conversion effects will take place if this entry has not been made. No account exists in as entry in the field entitled -elimination+ to indicate that the elimination amount should in this case be controlled by the application -PRO+.
Image : defined product group in the application -PRO+
An additional or discount rate of 15% has been stored in the product data and thus applies for all transactions for this product group.
Image : stored product data (PRODATE)
IC stock inventories were created afterwards. Due to the fact that an additional/discount rate has already been stored in the application PRODATE, there is no need to enter a value once again (unless the additional - discount rate for this ICVOR differs from the normal product group discount rate).
Image : maintained IC stock inventories (ICVOR)
The situation with respect to processing is as follows:
The status -red- will appear in the group companies + monitor (KTKGES) for -ZU+ consolidation, which means that non-processed ICVOR exist and that ZU consolidation still needs to be performed.
Image : red status in KTKGES in the column ZU
Once -elimination of current assets results complete ZU+ has been completed, the status will change from -red+ to -green+, which means consolidation processing has been completed.
Image : Execution of the action -ZU+
Image : green status following execution of ZU
By double-clicking onto the -ZU+ field or using the right mouse button and branching off, you will come to the ZWERGUV overview inside which all of the data processed for this company will be displayed:
Image : processed ICVOR for the company
Via -Action+ and -consolidation voucher+ you'll be able to have the consolidation voucher displayed
Image : ZU voucher
The elimination amount can be calculated as follows:
10000 GBP / 115% * 15% = 1304.34 * 1.156542 = 1,508.52 ? Elimination amount to PDK
10000 GBP / 115% * 15% = 1304.34 * 1.131745 = 1,476.18 ? Elimination amount to SK
Difference = 32.34 ? currency conversion effect
The additional - discount % value for this product group will be calculated in -PRODAT+. The posting of the elimination amount to the P+L elimination account takes place using the PDK exchange rate stored in -IC-BEW+. The exchange rate effect that takes place will be charged to the account stored in -KTKPAR-ZU+ and the elimination amount to SK will be charged against the asset account entered in the master data in the application -PRO+.
The ZU amount will be carried forward by the group carry forward to become a VZ voucher.
Image : Carried forward ZU voucher from the previous period
If no further ICVOR exists for the new period, the ZU status in KTKGES will be displayed as -red+ and ZU will still need to be initiated. The VZ voucher in the resulting ZU voucher will be turned back so that the change in stock that has been carried forward will be neutralized once again.
Image : ZU voucher in the following period without new ICVOR transactions
However, as long as the elimination amount has not changed, but rather only the exchange rate, only the difference needs to be posted. This takes place in IDL Konsis automatically when you perform ZU. The voucher will then look like this:
Image : ZU voucher in the following period
The calculation is as follows:
The entire intercompany profit from the current period will not be eliminated, instead the intercompany profit from the previous period will be subtracted from the current value. For this reason, the intercompany profit for the previous period will be carried forward in the carry forward voucher. The vouchers generated by calculating the currency conversion effects will thus be issued the posting type -WU+ when they are generated.
If no conversion effects are to be calculated on the elimination amount, then no currency conversion effect account may be entered in KTKPAR-ZU.
Image : KTKPAR-ZU without entering a currency conversion effect account
Processing takes place in the same way as calculating the elimination amount including currency conversion effects.
Deviations result on how to deal with currency conversion effects with respect to the carry forward and the calculation in the following period that are to be explained more clearly here.
ZU vouchers without calculation of currency conversion effects are to be issued the posting type -WX+, which means that balance postings are not carried forward whatsoever. P+L postings will be entered into the following period in a reverse manner and then posted against the retained earnings account due to the fact that the ZU for the following period eliminates the entire (accumulated) intercompany profit once again.
Image: ZU voucher without calculation of currency conversion effect
The VZ voucher that results from the carry forward neutralizes the intercompany profit from the previous period. In other words, the elimination of intercompany profit for the following period will be recalculated.
Image : VZ voucher in the following period without calculation of currency conversion effect