Introduction to SAP Closing Procedures
In the world of financial accounting, period-end closing is a mission-critical task. Ensuring that all assets and liabilities are accurately reported not only meets compliance requirements but also offers valuable insights for decision-making. SAP ERP provides a comprehensive suite of transactions—referred to as Tcodes—that help streamline these complex processes.Fixed Asset Management Tcodes
AFAB – Process Depreciation Run
The depreciation run is one of the key closing tasks for assets. Using Tcode AFAB, companies can post depreciation to reflect the wear and tear or usage of fixed assets.Steps:
- Navigate to: Accounting → Financial Accounting → Fixed Assets → Periodic Processing → Depreciation Run
- Select the company code and fiscal year
- Choose whether to simulate or post the depreciation
AR11 – Process Investment Grant
When managing grants related to investments, Tcode AR11 allows financial teams to track and post these grants effectively.- Found under: Fixed Assets → Periodic Processing → Investment Grant
- It aligns asset values with external funding sources, ensuring accurate financial statements.
AR29 – Revaluation Posting for Assets
Revaluation adjusts the book value of assets to reflect fair market value. Using Tcode AR29, companies can ensure their balance sheet reflects realistic asset valuations.- Path: Accounting → Financial Accounting → Fixed Assets → Periodic Processing → Revaluation for the Balance Sheet
- This step is crucial when inflation or economic changes impact asset values.
Fiscal Year Change for Asset Accounting
Before entering transactions for the new fiscal year, asset records must be rolled forward.- Navigate to: Periodic Processing → Fiscal Year Change
- This process locks prior fiscal year asset data and initializes the new one.
Year-End Reconciliation
Account reconciliation ensures consistency between asset sub-ledgers and general ledgers. Reconcile balances as part of your year-end activities.- A vital step to validate closing balances before proceeding with final year-end steps.
AJAB – Asset Year-End Closing Execution
Tcode AJAB finalizes the closing process by locking asset transactions for the fiscal year, ensuring no further changes.- - Navigate to: Year-End Closing → Execute
- - It’s mandatory before running reports or starting the next fiscal year.
Asset History Sheet Reporting
SAP allows for in-depth reporting via the Asset History Sheet, which provides a comprehensive view of asset transactions over the year.- Navigate to:
- Accounting → Fixed Assets → Info System → Reports on Asset Accounting → Notes to Financial Statement
- Choose between international or country-specific variants based on statutory reporting needs.
Inventory and Material Management Tcodes
MB5S – GR/IR Balance Report
Goods Receipt/Invoice Receipt (GR/IR) accounts track mismatches between received goods and invoices. Use Tcode MB5S to identify discrepancies.- Path: Logistics → Inventory Management → Balances Display → GR/IR Balances
- Ensures accurate vendor liabilities.
MR11 – Maintain GR/IR Clearing Account
Adjust the GR/IR clearing accounts to balance posted goods and related invoices using Tcode MR11.- Navigate via Invoice Verification → Further Processing
- Helps maintain clean and reconciled GR/IR accounts at period-end.
MR21 – Manual Material Price Changes
In case of manual intervention in material prices, Tcode MR21 allows direct price changes.- Found under: Valuation → Price Determination → Change Price
- Must be used cautiously to ensure audit trail integrity.
MR22 – Debit/Credit Material Valuation
When you need to adjust material value upwards or downwards, Tcode MR22 is used.- Essential for revaluation due to damage, obsolescence, or price changes.
CK24 – Product Costing Price Update
For cost control, Tcode CK24 updates standard costs post-costing run.- Found under: Product Cost Controlling → Product Cost Planning → Price Update
- Ensures alignment between material ledger and cost accounting.
Material Ledger Closing
The Material Ledger supports actual costing.- Navigate to: Valuation → Actual Costing/Material Ledger
- Closes the current period and starts a new one for material costing.
MMPV – Close Period
Tcode MMPV is used to close the current posting period in material management and open the next.- Located at: Material Master → Other → Close Period
- A critical monthly activity for inventory control.
MMRV – Allow Posting to Previous Period
In cases of late transactions, Tcode MMRV allows posting into a prior period.- Use cautiously and under strict governance.
Lowest Value Determination Tcodes
SAP allows various methods to assess inventory for the lowest possible valuation based on legal or business needs:| Tcode | Purpose |
|---|---|
| MRN0 | Market Prices |
| MRN1 | Range of Coverage |
| MRN2 | Movement Rate |
| MRN3 | Loss-Free Valuation |
These are used in: Valuation → Balance Sheet Valuation → Determ. Lowest Values
LIFO and FIFO Valuation
SAP supports:- LIFO (Last In, First Out): Preferred for tax optimization in inflationary periods.
- FIFO (First In, First Out): Aligns closely with actual consumption flows.
Physical Inventory Processing
Conducting a physical inventory ensures stock accuracy. SAP provides several Tcodes under:- Logistics → Physical Inventory
- Supports counting, recounting, and adjustment postings.
GR/IR and Tax Reconciliation
F.19 – Analyze GR/IR Clearing & Acquisition Tax
Use this report to:- Reconcile GR/IR accounts
- Analyze acquisition-related taxes
Define Adjustment Accounts
Setup regrouping accounts in:- IMG → General Ledger Accounting → Reclassify → Transfer and Sort Receivables and Payables
Accounts Payable and Accounts Receivable Closing Activities
F.17 – Print Balance Confirmation Letters
Balance confirmations are essential during audits and financial closures. Use Tcode F.17 to print letters for vendors and customers.- Path: A/P or A/R → Periodic Processing → Closing → Balance Confirmation → Print Letters
- Confirms account balances with external parties.
F.1B, F.1A – Configure Balance Confirmation
Before printing, configure layouts and formats using:- Tcode F.1B (Individual Confirmation)
- Tcode F.1A (Global Settings)
- Found in: A/P or A/R → Print Correspondence → Balance Confirmation
F-21 – Post Individual Value Adjustment
This Tcode allows you to post doubtful receivables individually without clearing them.- Used for special financial provisions.
- Found under: Document Entry → Other → Intern. Trans. Posting → Without Clearing
Account Determination for Valuation Adjustments
Define accounts used for flat-rate value adjustments in AR/AP.- IMG path: Financial Accouting → Accounts Receivable and Payable → Business Transactions → Closing → Valuate
F107 – Calculate Flat-Rate Value Adjustment
This Tcode runs valuation calculations based on pre-defined rates and risk profiles.- Path: A/R → Periodic Processing → Closing → Valuate
F-30 – Write-Off Doubtful Receivables
When a receivable is confirmed uncollectible, use Tcode F-30 to write it off with clearing.- Ensures your books reflect realistic receivable figures.
Foreign Currency Valuation and Exchange Rate Management
OB08 – Maintain Exchange Rates
Maintain daily or periodic currency conversion rates in Tcode OB08.- Path: Accounting → General Ledger → Environment → Current Settings
OB59 – Custom Valuation Methods
Set up valuation methods for foreign currency transactions here.- IMG path: General Ledger Accounting → Foreign Currency Valuation
F.05 – Valuate Open Items in Foreign Currency
This Tcode helps revalue foreign currency open items during period-end.- Adjusts based on current exchange rates.
OBA1 – Exchange Rate Differences Account Determination
Assign appropriate accounts to post FX gains/losses during revaluation.- Critical for compliant and traceable FX reporting.
F.06 – Revalue G/L Account Balances
Use this for G/L balances in foreign currency needing revaluation.- Ensures your balance sheet reflects up-to-date FX-adjusted balances.
Accruals and Deferrals
FBS1 – Posting Accrual/Deferral Entries
Create accrual and deferral documents for revenue/expenses not yet posted.- Found in: G/L → Periodic Processing → Valuate
F.81 – Reverse Accrual/Deferral Documents
Use this to reverse postings made in prior periods.- Helps in error correction and adjusting closing entries.
Recurring Entries Management
F.14 – Execute Recurring Entries
Automate repeating entries using Tcode F.14, improving accuracy and consistency.- Ideal for rent, insurance, and amortization postings.
FAQs about Assets and Liabilities Closing Tcodes in SAP
Q1: What is the purpose of closing Tcodes in SAP?
A: These Tcodes streamline the period-end closing process, ensuring accurate and timely financial statements. They help reconcile, post adjustments, and generate necessary reports.Q2: Can depreciation be reversed after posting via AFAB?
A: Yes, if posted in test mode, it can be rerun. However, posted depreciation must be reversed using special transactions like AB08.Q3: What happens if Fiscal Year Change is not run?
A: Without executing Fiscal Year Change, you won't be able to post asset transactions in the new fiscal year.Q4: Is it necessary to run MR11 at every period-end?
A: While not mandatory, running MR11 helps keep GR/IR balances clean and ensures accurate vendor liabilities.Q5: Can F.05 and F.06 be used interchangeably?
A: No. F.05 is used for open item revaluation, whereas F.06 targets G/L account balances.Q6: How often should F107 (Flat-Rate Adjustment Calculation) be run?
A: Ideally once per closing period (monthly, quarterly, or annually), depending on your organization’s financial policy.Conclusion: Ensuring Smooth Period-End with the Right Tcodes
Closing periods in SAP requires meticulous planning, accurate execution, and detailed reporting. From managing depreciation and revaluation of assets to handling complex GR/IR balances and foreign currency valuations, this comprehensive list of Assets and Liabilities Closing Tcodes ensures your financial books are audit-ready.