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Chapter 4
Defining Tolerance Groups for
G/L Accounts and Employees
In this chapter, you will learn the purpose of tolerance groups and how to define them in SAP R/3.
At the end of this chapter, you will be able to:
• Define tolerance groups for G/L accounts
• Define tolerance groups for employees
• Define tolerance groups for employees with a group key
• Assign users to tolerance groups
Tolerance Groups
Tolerance groups determine limits upon which acceptable payment differences are based. During document
posting, the system will check for any difference and match it against the defined limits to determine if the
difference is within the specified limits and automatically post the differences to a predefined account. If the
difference is outside the set limit, the system will automatically reject the posting.
It is a normal business practice for payment differences to occur in a business transaction. The bottom
line here is, what is the business willing to accept as an acceptable payment difference for a given business
transaction? This occurs when an invoice amount entered in the system is different from the actual amount
received to clear the outstanding invoice. For example, an outstanding invoice amount is $1,000 and the
amount paid to clear the outstanding invoice is $950, leaving you with a difference of $50. If the acceptable
limit for your tolerance groups is $45, the system will reject your posting because the difference is above
the acceptable limit. On the other hand, if the payment difference is $45 or less, the system will accept
your posting and post the difference to a specified predefined account, because the difference is within the
defined acceptable limit.
There are several reasons why differences occur. A typical example is as a result of goods damaged on
transit that reduce the value of the goods delivered. This brings up the concept of materiality, which is what
a business considers to be material or significant differences that cannot be overlooked or ignored. To enable
the system to perform limit checks, your company must define an acceptable payment difference.
Tolerances are necessary mainly for control purposes. In SAP ERP, maximum amounts deemed
acceptable by a business are defined in tolerances in a company code and assigned to a tolerance group.
Tolerances dictate payment difference authorizations (that is, tolerances are company code specific and
determine the amount accounting clerks are permitted to post to the system per transaction for invoice
clearing). Tolerances also allow you to specify settings that control the discounts that accounting clerks can
grant per invoice as well as any tolerances over payment.
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