1881042 - How to clear Accounts Payable against Accounts Receivable

SAP Knowledge Base Article - Public

1881042 - How to clear Accounts Payable against Accounts Receivable

Symptom

You want to clear payables items against the receivables items. In your case, your customer is also a supplier. So you want to offset supplier invoices against customer invoices.

Resolution

Netting is not supported in the current release. But we have a workaround.

There are 2 scenarios :

A. Receivable amount is same as that of payable amount. In this case, no payment will be made. You can do the below steps:

  1. Go to Payables work center.
  2. Select Supplier Accounts view.
  3. Select the appropriate account and click on View.
  4. Click on the button New Charge/Credit.
  5. Create a new charge for the total amount and post it.
  6. Select this new charge posting and the open items you want to clear.
  7. Click on Clear manually.
  8. If there is more than one item for clearing then you can also simply start manual clearing with only one item selected. On the following screen you also see all open items of that account and can filter e.g. by document ID to find the matching one.

  1. Go to Receivables work center.
  2. Select Customer Accounts view.
  3. Select the appropriate account and click on View.
  4. Click on the button New Charge/Credit.
  5. Create a new credit for the total amount and post it.
  6. Select this new credit posting and the open items you want to clear.
  7. Click on Clear manually.
  8. If there is more than one item for clearing then you can also simply start manual clearing with only one item selected. On the following screen you also see all open items of that account and can filter e.g. by document ID to find the matching one.

Please note the below points :

  1. This approach will clear items in the Customer and Supplier sides of the account. Creation of New Charge Credit items (Other Payable/Receivable) items will lead to Accounting Entries.
  2. The Document Description for these items can be maintained in the New Charge Credit screen, so that it is clear as to why these items are being created.
  3. The balances in both Accounts will be consistent.
  4. Use the same GL Account for both the charge credits.
  5. The posting dates of the charge credits should be the same.

Please also be noted that, if your transaction currency is diferent from your company currency, this approah might lead to profit/loss from exchange rate difference.

B. Receivable amount is not same as that of Payable then do the below steps :

If payable amount is larger than receivable then you will initiate the payment. For example : if payable balance is for 100 USD and receivable balance is for 40 USD then an outgoing payment for 60 USD will be made which will clear your supplier and customer account. You need to do the below steps :

  1. Go to Payables work center.
  2. Select Supplier Account view.
  3. Search for the respective account and select the row.
  4. Click on view.
  5. Go to Trade Payables tab and Invoice/Payments Sub-tab.
  6. Select one item.
  7. Click on Pay Manually by and select Other Payment Method.
  8. Go to Open Items tab.
  9. Click on Accounts and select the Add Account. Here add the customer account.
  10. Enter the values in the field.

This will add the account on the screen , now you can select the customer invoices and the supplier invoices. When you click on Execute Payment, 40 USD is cleared, 60 USD is made as an outgoing payment to the supplier.

If Recievable is larger than Payable and the payment is foreign initiated then the clearing will be done for the existing payment. For example : if payable balance is for 40 USD and receivable balance is for 100 USD. You need to do the below steps :

  1. First of all, create an incoming payment via bank statement with amount 60 to the customer account.
  2. When clicking the Reqired link of the bank statement item, make sure this amount partially clear one invoice item, instead of having the payment paid on account.
  3. Then go to Receivables work center.
  4. Select Customer Account view.
  5. Search for the respective account and select the row.
  6. Click on view.
  7. Go to Trade Receivables tab and Invoice/Payments Sub-tab.
  8. Select the Clearing ID. Reset the clearing.
  9. Click on Accounts and select the Add Account. Here add the supplier account and match the supplier invoices.
  10. Select the button Clear.

 This clears you supplier account and customer account with existing payment.

Please note that, in case there is no incoming payment from the customer yet, after the clearing, you can create a customer new charge/credit to set the receivable back to the customer account, in this case, it should 60 USD.

Of cause, if you do not want to choose any solutions above, you may create dummy incoming payments through bank statments of your bank to clear the receivables first, and on the same day, create same amount of dummy outgoing payments via bank statement of the same bank to clear the payables. In this case, both receivables and payables are cleared, and the bank account balance is not changed.

Keywords

KBA , LOD-CRM-SRP , Service Request Processing , How To

Product

SAP Business ByDesign all versions