How To Fix FARR_FOUNDATION803 - Account &1 is not valid; deferred revenue account must be a B/S account

SAP Error Message - Details

• Message type: E = Error

• Message class: FARR_FOUNDATION - Revenue Accounting - Foundation

• Message number: 803

• Message text: Account &1 is not valid; deferred revenue account must be a B/S account

What causes this issue?

The validation for the deferred revenue account failed because the
determined account is not a balance sheet account.

System Response

The system issues an error message and will not allow you to continue with this transaction until the error is resolved.

How to fix this error?

Check the account configuration under
<DS:SIMG.FI_GL_MD_FS00_DC>Edit G/L Account Centrally</>.
Maintain the correct account in the
<DS:TRAN.FARR_ACCT_DETER_CUST>BRF+ Account Determination Rules</> on
the tab <ZK>Deferred Revenue</>.

Procedure for System Administrators

Error message extract from SAP system. Copyright SAP SE.

Smart SAP Assistant

• What is the cause and solution for SAP error message FARR_FOUNDATION803 - Account &1 is not valid; deferred revenue account must be a B/S account ?

  The SAP error message FARR_FOUNDATION803 indicates that the account specified in the system is not valid for the context in which it is being used. Specifically, it states that the deferred revenue account must be a balance sheet (B/S) account. This error typically arises in the context of the SAP Revenue Accounting and Reporting (RAR) module or when dealing with deferred revenue in financial accounting.
  Cause:
  
  Account Type Mismatch: The account you are trying to use for deferred revenue is not set up as a balance sheet account in the chart of accounts. Deferred revenue accounts must be classified as balance sheet accounts because they represent liabilities until the revenue is recognized.
  Configuration Issues: The account may not be properly configured in the system, or it may have been incorrectly assigned in the relevant configuration settings.
  Incorrect Account Assignment: The account number specified in the transaction may be incorrect or may not exist in the system.
  
  Solution:
  
  
  Check Account Configuration:
  
  Go to the transaction code FS00 (G/L Account Master Record) and check the account type of the specified account.
  Ensure that the account is set up as a balance sheet account (typically, this means the account should have a type of "B" for balance sheet).
  
  
  
  Modify Account Settings:
  
  If the account is not a balance sheet account, you may need to create a new account or modify the existing one to ensure it is classified correctly.
  If you need to create a new account, ensure that it is set up with the correct account type and other relevant settings.
  
  
  
  Review Configuration Settings:
  
  Check the configuration settings in the SAP system related to revenue recognition and deferred revenue. This can typically be found in the customizing settings under Financial Accounting (FI) > General Ledger Accounting > Master Data > G/L Accounts > Preparation.
  
  
  
  Consult Documentation:
  
  Review SAP documentation or help resources for specific guidelines on setting up deferred revenue accounts and ensuring compliance with accounting standards.
  
  
  
  Testing:
  
  After making the necessary changes, test the transaction again to ensure that the error is resolved.
  
  
  
  Related Information:
  
  Transaction Codes: 
  
  FS00: G/L Account Master Record
  OBY6: Define Company Code
  OBD2: Define Account Types
  
  
  SAP Notes: Check for any relevant SAP Notes that may provide additional insights or solutions related to this error message.
  Consult with Finance Team: If you are unsure about the correct account to use, consult with your finance or accounting team to ensure compliance with your organization's accounting policies.
  
  By following these steps, you should be able to resolve the error message FARR_FOUNDATION803 and ensure that the deferred revenue account is correctly configured in your SAP system.