Tolerance Key
DEFINTION
To efficiently monitor and control financial transactions, SAP allows users to set limitations for a variety of transactions, including payments, cash discounts, and invoice variances.
By enforcing adherence to predetermined financial limitations, these tolerance groups minimize errors and reduce the possibility of unlawful transactions.
CONFIGURATION
SAP Tolerance Group Categories
Employee Tolerance Groups (OB57):
These are limits on the amount that employees are permitted to approve or post in financial transactions.
Examples: Processing invoices is the responsibility of a single employee.
The following configurations may be present in her tolerance group:
- Rs. 10,000 is the maximum amount per document.
- 2% is the maximum cash discount.
- Rs. 5,000 is the maximum line item.The system will either prohibit the posting or request higher-level clearance if an invoice line item exceeds Rs. 5,000 or the cash discount is greater than 2% in this instance. The employee is only able to handle a single document up to Rs. 10,000.
Customer / Vendor Tolerance Groups (OBA3):
When processing payments and invoices, these set the maximums for cash discounts and payment discrepancies.
Examples: A Rs. 1,000 open invoice belongs to a customer, ABC Corp.
ABC Corp.'s tolerance group settings could be:
- Allowable Payment Difference: Rs. ₹10 or 1% of the total invoice amount
- Allowed Cash Discount Difference: Rs. ₹5 or 0.5 percent of the total invoice amount
GL Account Tolerance Groups (OBA4):
The posting amounts to General Ledger accounts are limited by these.
The ranges of tolerance consist of:
As an illustration: A tolerance group for "Miscellaneous Expenses" in a General Ledger (GL) account could include the following:
The maximum amount posted is Rs. 2,000.
SAP will block an employee from posting a transaction for Rs. 2,500 to this GL account unless it has been authorized by a person in a position of authority.
Tolerance Limits for Invoice Verification (OMR6):
SAP MM's (Material Management) invoice verification procedure makes advantage of this.
It establishes the permissible limits for differences between the invoice, goods receipt, and purchase order.
Price Variance: The allowed difference in price between the invoice and the purchase order.
Quantity Variance: Allowed variation in quantity.
Small Differences: Modest modifications that can be automatically posted requiring without approval.
Tolerance Groups for Automatic Payment (FBZP):
Establish tolerance levels for payments made automatically. These configurations regulate the variations that can be automatically corrected when processing payments, like minor variations in amount.
Invoice Tolerances: The system can automatically process an invoice within the specified tolerance if it is marginally higher than the purchase order as a result of small price increases.
Payment Tolerances: A payment difference may be automatically cleared without the need for human interaction if it falls within the permitted tolerance.
