Creation Special GL Account ‘Advance to Vendors’ and clearing it with the normal invoice related to the advance

Generally, goods provided to the organization are paid for after receipt. It may be necessary to provide a known and reputable vendor with an advance payment (prepayment). To deal this kind of situation SAP has provided certain option to customize to get the process accounted to Financial Module.

Follow the following steps in SAP:

Create Special GL Account ‘Advance to Vendors (Reconciliation Account)’ under current assets

T Code: FS00

Things to be remembered while creating the GL account for advance to vendors;

Field status should be set to: G067

Reconciliation Account should be set to: Vendor

Short Key should be set to: 012

Link the Sundry Creditors and Special GL Indicator ‘Advance to Vendors’

T code: OBYR

Double click on Special GL Indicator: A for down payment on current assets

Put the special GL account against the reconciliation account. If you have more than one reconciliation account then against each reconciliation account you need to mention the special gl account.

Down Payment Postings

Now you can do the down payment posting by using T Code: F-48

Purchase Invoice Postings

After down payment you can use T Code: F-43 for invoice posting

Transfer the down payment from Special GL to normal item by clearing special GL account

To transfer the down payment to clear it with the normal invoice posting use T Code: F-54

Clearing of Normal Item

Finally use T Code: F-44 to clear the normal item

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Editorial Staff at Yourfinancebook is a team of finance professionals. The team has more than a decade experience in taxation and personal finance.