How To Fix G06007 - Reported push-down data results in extraordinary amort. of goodwill

SAP Error Message - Details

• Message type: E = Error

• Message class: G06 - SAP Cons - Error Message re. Consolidation of Investments

• Message number: 007

• Message text: Reported push-down data results in extraordinary amort. of goodwill

What causes this issue?

The reported push-down data for investee unit &V1& with partner unit
&V2& contains a valuation allowance, which does not correspond to the
ordinary amortization of goodwill. Therefore, an extraordinary
amortization of goodwill will take place.

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 reported push-down data of investee unit &V1& with partner
unit &V2&.

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 G06007 - Reported push-down data results in extraordinary amort. of goodwill ?

  The SAP error message G06007, which states "Reported push-down data results in extraordinary amortization of goodwill," typically arises in the context of financial reporting and consolidation processes, particularly when dealing with business combinations and the associated accounting for goodwill.
  Cause:
  
  
  Push-Down Accounting: This error often occurs when push-down accounting is applied, which means that the financial statements of a subsidiary reflect the fair value adjustments made during a business combination. If the adjustments lead to an extraordinary amortization of goodwill, this error is triggered.
  
  
  Goodwill Calculation Issues: The calculation of goodwill may be incorrect due to improper allocation of purchase price or failure to account for certain assets and liabilities correctly.
  
  
  Inconsistent Data: There may be inconsistencies in the data being reported, such as differences in the treatment of goodwill across different periods or entities.
  
  
  Configuration Issues: Incorrect configuration in the SAP system regarding the handling of goodwill and amortization can also lead to this error.
  
  
  Solution:
  
  
  Review Goodwill Calculations: Ensure that the goodwill calculations are accurate and that all relevant assets and liabilities have been properly accounted for. This includes verifying the purchase price allocation.
  
  
  Check Push-Down Accounting Settings: Review the settings for push-down accounting in your SAP system. Ensure that they are configured correctly and that the necessary adjustments are being made appropriately.
  
  
  Data Consistency: Ensure that the data being reported is consistent across all relevant entities and periods. This may involve reconciling differences in financial reporting.
  
  
  Consult Documentation: Refer to SAP documentation or notes related to this error message for specific guidance on how to resolve it. SAP Notes may provide patches or updates that address known issues.
  
  
  Engage with SAP Support: If the issue persists, consider reaching out to SAP support for assistance. They can provide insights based on the specific configuration and version of your SAP system.
  
  
  Training and Awareness: Ensure that the finance team is trained on the implications of push-down accounting and the proper handling of goodwill to prevent future occurrences of this error.
  
  
  Related Information:
  
  Goodwill Accounting: Understanding the principles of goodwill accounting, including how it is calculated and amortized, is crucial for resolving this error.
  Business Combinations: Familiarity with the accounting standards related to business combinations (e.g., IFRS 3 or ASC 805) can provide context for the treatment of goodwill.
  SAP Financial Modules: Knowledge of the specific SAP financial modules (e.g., FI, CO) and their configurations can help in troubleshooting and resolving issues related to financial reporting.
  
  By addressing the underlying causes and following the suggested solutions, you should be able to resolve the G06007 error in your SAP system.