What is expense deferral in SAP SRD-FIN-COR - FIN-Cost and Revenue?

SAP Term: expense deferral

• Component: SRD-FIN-COR

• Component Name: FIN-Cost and Revenue

• Description: A process that posts expenses to deferral accounts if the associated revenues have not yet been recognized.

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• Key Concepts: 
  Expense deferral is a feature of SAP's SRD-FIN-COR FIN-Cost and Revenue Accounting component that allows companies to delay the recognition of certain expenses. This can be done by either postponing the payment of the expense or by recognizing the expense in a later period. This allows companies to better manage their cash flow and budgeting. 
  
  How to use it: 
  To use expense deferral, companies must first identify which expenses they would like to defer. Once identified, they must then decide whether to postpone the payment of the expense or recognize it in a later period. Companies can then set up a deferral account in SAP and enter the details of the expense. The deferral account will then be used to track the deferred expenses until they are recognized. 
  
  Tips & Tricks: 
  When using expense deferral, it is important to ensure that all deferred expenses are properly tracked and accounted for. Companies should also ensure that any deferred expenses are recognized in a timely manner so that their financial statements remain accurate. 
  
  Related Information: 
  Expense deferral is closely related to other accounting concepts such as accruals and prepaid expenses. Accruals involve recognizing expenses before they are paid, while prepaid expenses involve recognizing expenses before they are incurred. Understanding how these concepts work together can help companies better manage their finances.