SAP Clearing Document: How to Find and Analyse Cleared Items

The SAP financial close process is the work finance teams complete before they report on a month, quarter or year.

At first, close can look like one deadline. In practice, it includes several connected tasks. Finance teams post transactions to the right period. They check key accounts. They clear open items where they can. They also explain any differences that remain.

A delay in one area can slow down the whole close. For example, a balance-sheet account may lack evidence. An intercompany balance may not agree. Or a large number of customer payments may still sit unallocated.

Quick answer: what is the SAP financial close process?

The SAP financial close process helps finance teams make sure their records are accurate and ready for reporting before they close a period.

It normally includes:

• Completing period-end postings and cut-off activities
• Checking AP, AR, general ledger and intercompany balances
• Reconciling balance-sheet accounts
• Clearing open items
• Investigating differences
• Preparing evidence for review
• Completing reporting and closing the period

SAP provides the main tools to manage finance data and closing tasks. For example, the SAP S/4HANA Financial Closing cockpit helps teams organise task lists and track their close work. help.sap.com

However, listing the tasks is often the easy part. Teams also need to complete checks and clearing work on time. They need the right people to review it. They also need clear evidence.

1. Set the timetable, ownership and cut-off points

First, each SAP financial close process needs a clear timetable.

Finance teams need dates for routine transactions, journals, accruals, reconciliations and reviews. Without a plan, work can build up until the final days of close.

Next, assign each task to a named person or team. One person may prepare a reconciliation. Another may review it. A third person may need to investigate a large difference.

This matters when shared-services teams, local finance teams and several company codes share the work.

Teams also need clear cut-off points. Supplier invoices, customer payments and intercompany postings can change balances. Therefore, finance teams need a process for late activity. Otherwise, a balance may change after the team has already checked it.

For a wider list of close activities, see our SAP month-end closing activities checklist.

2. Complete routine postings and period-end adjustments

Before the team checks balances, SAP needs to show a full view of the period.

This stage may include:

• Processing supplier invoices and credit notes
• Posting customer invoices and receipts
• Recording accruals, depreciation, prepayments and provisions
• Posting foreign-currency adjustments
• Checking both sides of intercompany transactions

For example, a team may need to post an accrual for a cost it has not yet received an invoice for. It may also need to post a journal for a known adjustment.

The aim is not to post everything as fast as possible. Instead, the team needs SAP to show material activity for the right period. This gives people a sound basis for their checks.

This part of the SAP financial close process can also reveal data issues. An invoice may sit in the wrong account. A payment may lack a useful reference. An intercompany posting may be missing. As a result, each issue can create more work later.

3. Reconcile balance-sheet accounts

During close, finance teams need to check balance-sheet accounts.

They compare each SAP general-ledger balance with supporting information. This may be a subledger balance, an external statement, a schedule or a calculation.

For example, a team may compare a bank balance in SAP with a bank statement. It may compare an AP control account with the AP subledger. These checks help the team confirm that the balance makes sense.

Sometimes, a difference remains. In that case, the team needs to find the cause. It may be an old item. It may be a timing difference. Or it may point to an error that needs fixing.

The BEST Balance Sheet Recons module supports this work in SAP. It helps teams manage account checks, flag items that need review and attach evidence. It also routes work for approval and keeps an audit trail.

For more detail, see our guide to the general ledger reconciliation process in SAP.

4. Clear open items that can be resolved

Open items can cause a lot of extra work at close. This is common when there are many transactions or several company codes.

SAP clears an item when related entries offset each other. The resulting balance is zero. For instance, SAP can clear a customer invoice against the payment received for it.

However, payments do not always match straight away. The amount may differ. A remittance reference may be missing. In those cases, a finance team may need to clear the item manually. help.sap.com

Teams may need to clear:

• Intercompany items
• Customer payments
• Supplier balances
• General-ledger items

They may also need to check partial payments, duplicate entries and small remaining balances. Some items will not meet the rules for automatic clearing.

The BEST Open Item Clearing module automates bulk clearing in SAP. It uses matching rules that teams can set for their own needs. As a result, teams can focus on exceptions that need judgement.

The BEST Customer Clearing module matches remittance information to open receivables in SAP. This can help teams reduce unallocated cash before close.

You can also read our guide to SAP F.13 automatic clearing.

5. Investigate differences and exceptions

Finance teams will not resolve every difference before the close deadline. However, they need to see the items that remain. They also need to understand the reason for each one.

Common examples include:

• A supplier statement that does not agree with the SAP vendor account
• An intercompany balance that differs between two entities
• A customer payment that cannot yet be matched to invoices
• A balance-sheet account with an old reconciling item
• Open items that do not meet the agreed matching rules

At this point, the team should assign each exception to an owner. That person can investigate it and record the next step. They may resolve the issue before close. Alternatively, they may get formal sign-off for it.

This gives finance leaders a clearer view of risk. It also helps them spot repeated issues. Therefore, teams can deal with the cause instead of facing the same problem every month.

6. Review, approve and keep evidence

A reconciliation is not complete just because someone has prepared it.

Next, the right reviewer needs to check the work. This is important for large accounts and accounts with unresolved items. Reviewers need to understand the balance. They also need to see the evidence and any explanation for a difference.

For each key account, finance teams should be able to access:

• The SAP balance under review
• The evidence or schedule
• Reconciling items and explanations
• The preparer and reviewer
• The date of preparation and approval
• Any follow-up action

For this reason, it helps to keep this information in SAP. Teams can manage the work more easily. It also helps when an auditor asks for evidence.

Instead of searching through folders and old emails, the team can access the reconciliation, evidence and approval history in one place.

7. Complete reporting and close the period

Finally, finance teams complete reporting once they have checked key accounts, cleared eligible items and understood the main exceptions.

This does not mean every balance will be zero. It also does not mean every exception will disappear. It means the team has checked material balances, understands open issues and has the right approvals.

After close, teams should review where they lost time. Did late adjustments affect the process? Did customer clearing take longer than expected? Did reviewers lack the evidence they needed?

These questions can improve the next SAP financial close process. Small changes can make each close more predictable.

Where BEST fits in the SAP financial close process

BEST supports reconciliation and clearing work within the SAP financial close process. It does not replace SAP’s wider close tools, consolidation software or a full close-task-management platform.

In short, BEST helps teams with the finance work that can hold up close. This includes checking balances, clearing transactions, investigating exceptions and preparing evidence for review.

FAQs

What is the SAP financial close process?

The SAP financial close process is the work finance teams complete to make sure records are accurate and ready for reporting before they close a period.

What is the difference between financial close and account reconciliation?

Financial close covers the full process of preparing a period for reporting. Account reconciliation is one part of that work. It confirms that account balances are accurate and supported.

Can SAP automate financial close?

SAP can automate many close tasks. In addition, SAP-native tools can help teams improve reconciliation, clearing, reviews, approvals and evidence management.

Which BEST modules support financial close?

The BEST Balance Sheet Recons module, BEST Open Item Clearing module, BEST Customer Clearing module and BEST Vendor Recons module support key reconciliation and clearing tasks within financial close.

Bring more control to financial close in SAP

If reconciliation, clearing and approval work is slowing down your close, book a demo with BEST to see how the modules work directly in SAP.