How To Fix GK669 - The treatment of negative goodwill must be chosen.

SAP Error Message - Details

• Message type: E = Error

• Message class: GK - Messages for SAP Consolidation

• Message number: 669

• Message text: The treatment of negative goodwill must be chosen.

What causes this issue?

Various elimination options are available for the treatment of
<DS:GLOS.negative_goodwill>negative goodwill</> as part of the
<DS:GLOS.consolidation_of_investments>consolidation of investments.</>
These settings have not been made in the current
<DS:GLOS.dimension>dimension.</>

System Response

Warning

How to fix this error?

Choose at least one elimination option for negative goodwill.

Error message extract from SAP system. Copyright SAP SE.

Smart SAP Assistant

• What is the cause and solution for SAP error message GK669 - The treatment of negative goodwill must be chosen. ?

  The SAP error message GK669, which states "The treatment of negative goodwill must be chosen," typically arises in the context of financial accounting and consolidation processes within SAP. This error is related to the handling of negative goodwill (also known as "bargain purchase") in financial statements.
  Cause:
  Negative goodwill occurs when the purchase price of an acquired company is less than the fair value of its net identifiable assets. In SAP, when you are processing a business combination or consolidation, the system requires you to specify how you want to treat this negative goodwill. The absence of a defined treatment leads to the error message GK669.
  Solution:
  To resolve this error, you need to specify the treatment of negative goodwill in the relevant configuration settings. Here are the steps to do this:
  
  
  Access the Configuration Settings:
  
  Go to the SAP Easy Access screen.
  Navigate to the following path: SPRO -> Financial Accounting -> Financial Accounting Global Settings -> Ledgers -> Define Treatment of Negative Goodwill.
  
  
  
  Define Treatment:
  
  In the configuration settings, you will find options for how to treat negative goodwill. You can choose to either:
  
  Recognize it as income in the profit and loss statement.
  Offset it against the goodwill of the acquired entity.
  
  
  Select the appropriate option based on your accounting policies and the requirements of your financial reporting.
  
  
  
  Save Changes:
  
  After making your selection, save the changes to ensure that the system recognizes the treatment of negative goodwill.
  
  
  
  Reprocess the Transaction:
  
  Once the treatment has been defined, reprocess the transaction that triggered the error message.
  
  
  
  Related Information:
  
  Accounting Standards: The treatment of negative goodwill may be influenced by accounting standards such as IFRS or GAAP, so it is essential to ensure compliance with the relevant regulations.
  Documentation: Refer to SAP documentation or your organization's accounting policies for guidance on the appropriate treatment of negative goodwill.
  Consultation: If you are unsure about the correct treatment, consider consulting with your finance team or an SAP expert to ensure that the decision aligns with your organization's financial reporting strategy.
  
  By following these steps, you should be able to resolve the GK669 error and proceed with your financial processes in SAP.