How To Fix GC304 - Retained earnings/BS does not equal net income/IS (in local currency)

SAP Error Message - Details

• Message type: E = Error

• Message class: GC - Error Messages for Consolidation/Extended General Ledger

• Message number: 304

• Message text: Retained earnings/BS does not equal net income/IS (in local currency)

What causes this issue?

Company &V1&,
Fiscal year &V2&,
Period &V3&,
Version &V4&:
The balance, accumulated up to the desired period, has been checked for
equality across all value items on the balance sheet and the income
statement.

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?

Please check the item definitions and the existing data records, if
applicable.

Error message extract from SAP system. Copyright SAP SE.

Smart SAP Assistant

• What is the cause and solution for SAP error message GC304 - Retained earnings/BS does not equal net income/IS (in local currency) ?

  The SAP error message GC304 indicates that there is a discrepancy between the retained earnings in the balance sheet (BS) and the net income in the income statement (IS) for a specific period in local currency. This error typically arises during the year-end closing process or when running financial reports.
  Causes of GC304 Error
  
  Data Entry Errors: Incorrect postings in the general ledger can lead to mismatches between the income statement and balance sheet.
  Unposted Transactions: Some transactions may not have been posted to the general ledger, leading to incomplete financial data.
  Incorrect Configuration: Issues with the configuration of the financial statements or the chart of accounts can cause discrepancies.
  Currency Translation Issues: If there are foreign currency transactions, translation differences may not have been accounted for correctly.
  Manual Adjustments: Manual journal entries that do not follow the proper accounting principles can lead to inconsistencies.
  Closing Entries: Missing or incorrect closing entries can result in retained earnings not reflecting the correct net income.
  
  Solutions to GC304 Error
  
  Review Journal Entries: Check all journal entries for the period in question to ensure they are correctly posted and balanced.
  Reconcile Accounts: Perform a reconciliation of the income statement and balance sheet accounts to identify discrepancies.
  Check Configuration: Verify the configuration settings in the SAP system for financial reporting and ensure they are set up correctly.
  Post Missing Transactions: Ensure that all transactions for the period have been posted, including any adjustments or accruals.
  Review Closing Process: Ensure that all necessary closing entries have been made and that the closing process has been completed correctly.
  Run Reports: Use SAP reports (like the balance sheet and income statement) to identify where the discrepancies are occurring.
  Consult Documentation: Refer to SAP documentation or help resources for specific guidance on resolving this error.
  
  Related Information
  
  Transaction Codes: You may use transaction codes like FS00 (to check account balances), FBL3N (to view line items), and S_ALR_87012284 (to view balance sheet and income statement) to investigate further.
  SAP Notes: Check SAP Notes for any known issues or patches related to this error message.
  User Roles: Ensure that users have the appropriate roles and permissions to view and modify financial data.
  Testing: After making corrections, run a test closing to ensure that the error does not reoccur.
  
  By following these steps, you should be able to identify and resolve the underlying issues causing the GC304 error in SAP.