How To Fix FARR_FOUNDATION804 - Account &1 not valid; recognized revenue account must be a P/L account

SAP Error Message - Details

• Message type: E = Error

• Message class: FARR_FOUNDATION - Revenue Accounting - Foundation

• Message number: 804

• Message text: Account &1 not valid; recognized revenue account must be a P/L account

What causes this issue?

The validation for the recognized revenue account failed because the
determined account is not a profit/loss 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>Recognized 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_FOUNDATION804 - Account &1 not valid; recognized revenue account must be a P/L account ?

  The SAP error message FARR_FOUNDATION804 indicates that the account specified in the system is not valid for the recognized revenue account, which must be a Profit and Loss (P/L) account. This error typically arises in the context of the SAP Revenue Accounting and Reporting (RAR) module when trying to post or recognize revenue.
  Cause:
  
  Account Type: The account specified (denoted as &1 in the error message) is not configured as a Profit and Loss account in the chart of accounts. It may be set up as a balance sheet account or another type that is not suitable for revenue recognition.
  Configuration Issues: There may be issues in the configuration of the revenue accounts in the system, such as incorrect account assignments or missing settings in the financial accounting module.
  Master Data Issues: The account master data may not be set up correctly, leading to the system not recognizing it as a valid P/L account.
  
  Solution:
  
  
  Check Account Configuration:
  
  Go to the account master data in SAP (transaction code FS00) and check the account type for the account in question. Ensure that it is set as a Profit and Loss account.
  If it is not, you may need to create a new account or modify the existing one to ensure it is classified correctly.
  
  
  
  Review Revenue Recognition Settings:
  
  Check the configuration settings in the RAR module to ensure that the recognized revenue accounts are correctly assigned and that they point to valid P/L accounts.
  You can access the configuration settings through transaction code SPRO and navigate to the relevant sections for revenue recognition.
  
  
  
  Consult with Financial Team:
  
  If you are unsure about making changes to account configurations, consult with your finance or accounting team to ensure compliance with accounting standards and practices.
  
  
  
  Testing:
  
  After making the necessary changes, perform a test transaction to ensure that the error no longer occurs and that revenue can be recognized correctly.
  
  
  
  Related Information:
  
  SAP Notes: Check for any relevant SAP Notes that may provide additional guidance or fixes related to this error message.
  Documentation: Review SAP documentation on Revenue Accounting and Reporting for best practices and configuration guidelines.
  User Forums: Consider searching or posting in SAP community forums for insights from other users who may have encountered similar issues.
  
  By following these steps, you should be able to resolve the FARR_FOUNDATION804 error and ensure that the recognized revenue account is valid for your transactions.