How To Fix FR671 - Valuation CoCode &1, acct &2: Adjustment acct &3 is a tax account

FR671 - Overview

• Message type: E = Error

• Message class: FR - Messages for FI Reporting

• Message number: 671

• Message text: Valuation CoCode &1, acct &2: Adjustment acct &3 is a tax account

What causes this issue?

During foreign currency valuation for account &V2& in company code &V1&
, the account determination check has found that the assigned balance
sheet adjustment account &V3& is marked as a tax account. Valuation
differences must not be posted to tax accounts because doing so would
mean that the tax accounts can no longer be reconciled with the tax
register.

System Response

The items/balances of account &V2& in company code &V1& are not valuated
in the current valuation run for valuation area &V4&.

How to fix this error?

Use transaction OBA1 to check the account determination of foreign
currency valuation for the account &V2&, company code &V1&, valuation
area &V4&. Assign to the valuated account a balance sheet adjustment
account that is not a tax account.

Procedure for System Administrators

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

Error message extract from SAP system. Copyright SAP SE.

FR671 - Details

• The SAP error message FR671 indicates that there is an issue with the configuration of accounts in the financial module, specifically related to tax accounts. Here’s a breakdown of the cause, potential solutions, and related information for this error:
  
  Cause:
  The error message FR671 occurs when you attempt to use a tax account as an adjustment account in a financial transaction. In SAP, certain accounts are designated for specific purposes, and tax accounts cannot be used as adjustment accounts. This is a safeguard to ensure that tax calculations and postings are handled correctly and do not interfere with other financial transactions.
  
  Solution:
  To resolve this error, you can take the following steps:
  
  
  Check Account Configuration:
  
  Go to the account configuration in the SAP system (Transaction Code: FS00).
  Verify the account settings for the account specified in the error message (account &2).
  Ensure that the account is not set up as a tax account if it is intended to