What is eliminating entry in SAP FIN-CS - S4HANA Financial Consolidation?

SAP Term: eliminating entry

• Component: FIN-CS

• Component Name: S4HANA Financial Consolidation

• Description: The entries that, together with consolidation group-based consolidation entries, turn financial data reported by the consolidation units into consolidated financial data. For example, eliminating entries are posted as follows: Receivables and payables Revenue and expense Profit or loss in transferred assets These entries are performed on posting level 20, meaning a level of paired consolidation units.

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• Key Concepts: 
  Eliminating entry is a process used in SAP S4HANA Financial Consolidation to remove the effect of intercompany transactions from the consolidated financial statements. This process is used to ensure that the consolidated financial statements accurately reflect the financial position of the group as a whole, rather than the individual companies. 
  
  How to use it: 
  In SAP S4HANA Financial Consolidation, eliminating entries are created by entering a journal entry with a debit and credit for the same amount. The debit and credit accounts should be selected from the intercompany accounts that are used to record intercompany transactions. The journal entry should be marked as an eliminating entry, which will ensure that it is not included in the consolidated financial statements. 
  
  Tips & Tricks: 
  When creating eliminating entries, it is important to ensure that the amounts being debited and credited are equal. If they are not, then this could lead to incorrect results in the consolidated financial statements. Additionally, it is important to ensure that all intercompany transactions have been recorded in the correct accounts before creating eliminating entries. 
  
  Related Information: 
  For more information on eliminating entries in SAP S4HANA Financial Consolidation, please refer to the official SAP documentation at https://help.sap.com/viewer/product/S4HANA_FIN_CONS/2020/en-US.