•    The final payment of the remaining USD 7,000 is made to the employee via a bank (using the automatic payment program [F110] feature).

I describe various options to set up this flow and explain the most desirable scenario and the related settings needed. Table 1 shows the various scenarios based on the sample data. It shows what postings happen at various stages in a scenario. (In Table 1, Dr. means debit and Cr. means credit.)

Table 1

Various scenarios and accounting treatments

Generally, there are three scenarios for the travel advance process in a business:  

Scenario A: SAP Travel Management Used for Just Documentary Purposes for Advances

Customization Settings

Figure 1

Select a trip provision variant

In the next screen (Figure 2), enter 0 (never post advance) in column 2 of the Other Settlement row relevant for wire transfer advances and enter 0 (never post cash advances) in column 7 of the Other Settlement row relevant for cash advances. Click the save icon to save your data.

Figure 2

Settings for cash advance – manual entry

Processing Flow

To create the travel request, execute transaction code TRIP or follow SAP Easy Access Menu path Accounting > Financial Accounting > Travel Management > TRIP - Travel Manager. In the screen that appears (Figure 3), the employee enters the advance details and marks the advance as a cash advance. Note that the Cash check box needs to be selected to mark the entry as a cash advance.

Figure 3

Enter a cash advance in the travel request

After the travel request is approved by the relevant approver, the cash office makes the advance manually and posts a document in FI to record the advance for USD 5,000 paid manually with the effect of the entry as:

•    Credit cash: 5,000

The finance department then settles the travel request and transfers it to FI. Nothing is posted yet, however, because you still have to set up the indicator as never post cash advances as shown in Figure 2. Settlement is done by the finance department as a process step in SAP Travel Management, but nothing is posted in FI.

After the finance department settles the travel expense report using transactions PREC, PRFI, and PRRW, a posting is made for the full amount of the travel expense shown in Figure 4.

Figure 4

Post on transferring the travel expense report to accounting

The finance team adjusts the manual posting of the advance against the trip expense posted and makes the payment of the balancing amount of USD 7,000. The finance team then clears the vendor account, which is now zero balance for the flow above.

Scenario B: Travel Advances Paid by Cash

Customization Settings

To customize general settings related to the travel advance, the first thing you do is activate the advance fields in SAP Travel Management to enable the entry of advances in the trip by employee. To complete this step, execute transaction code FITVFELD or follow menu path SPRO > Financial Accounting (New) > Travel Management > Travel Expenses > Dialog and Travel Expenses Control > Dialog Control > Define Schema and Individual Field Control. The screen shown in Figure 5 prompts you for a trip provision variant. Enter a value in the Trip Prov. Variant field and click the enter icon (the green check mark).

Figure 5

Enter a trip provision variant

Activate the Advances option in various trip schemas applicable for your trip provision variant. For example, as shown in Figure 6, you activate the advances for domestic trips, and as shown in Figure 7, you activate the advances for travel planning.

Figure 6

Activate advances for domestic trip schema

Figure 7

Activate advances for travel planning trip schema

To do this, select a schema (e.g., Trip Schema: 01 Domestic Trip in Figure 6 and Trip Schema PL: Travel Planning in Figure 7). Select the Advances check box in the Activate Entry Screens section and click the save icon to save the changes. Figure 8 shows that the Advance option is pre-activated by the SAP system in the schema for travel advances.

Figure 8

Pre-activated advances for trip advances trip schema

Accounting Treatment Settings

To configure accounting treatment settings for scenario B, execute transaction code S_AHR_61009734 or follow menu path SPRO > Financial Accounting (New) > Travel Management > Travel Expenses > Dialog and Travel Expenses Control > Travel Expenses Control > Travel Expenses Control (Expert View). In the initial screen shown in Figure 1, select the relevant trip provision of your organization and double-click it.

In the next screen (Figure 9), enter 0 (never post advance) in column 2 of the Other Settlement row relevant for wire transfer advances and enter 2 (posting only in trip approved status status) in column 7 of Other Settlement row relevant for cash advances. Then click the save icon to save the changes.

Figure 9

Settings for cash advance

Processing Flow

In this description of processing flow, I show only the impact of a travel advance on financial postings created out of settlement. To learn about the configuration steps for settlement in SAP Travel Management, refer to the Financials Expert article “Automate Travel Expense Settlement and Transfer to Finance.”

While creating the travel request, an employee enters the advance details and marks the advance as a cash advance as shown in Figure 10. The Cash check box needs to be selected to mark it as a cash advance. 

Figure 10

Enter the cash advance in the travel request

After the travel request is approved by the relevant approver, the finance team makes the advance creation for 5,000 (USD) manually with the effect of entry as:

Figure 11

Post on transferring the travel expense report to accounting

Scenario C: Travel Advances Paid by Wire Transfer

Customization Settings

Accounting Treatment Settings

In the next screen as shown in Figure 12, enter 1 (posting only in request approved status) in column 2 of the Other Settlement row relevant for wire transfer advances and enter 0 (never post cash advances) in column 7 of Other Settlement row relevant for cash advances. Then click the save icon to save the changes.

Figure 12

Settings for wire transfer of an advance

Processing Flow

While creating the travel request, an employee enters the advance details and marks the advance as a wire transfer by not selecting the Cash indicator as shown in Figure 13.

Figure 13

Enter a wire transfer advance in the travel request

The travel request is approved by the relevant approver. The finance department settles the travel request and transfers it to FI. The system then posts the advance automatically as shown in Figure 14.

Figure 14

Post on transferring the travel request to accounting

The traveler creates the travel expense report by including the expense line of USD 12,000 for airfare. The travel expense report is approved by the relevant approver. The finance department settles the travel request and transfers it to FI. Posting is made net of advance to the employee vendor account as shown in Figure 15.

Figure 15

Post on transferring the travel expense report to accounting

The finance team makes the payment of the amount USD 7,000 created for trip settlement. The finance team clears the vendor account, which is now zero for the flow above.

You now have gone through the steps for handling advances in SAP Travel Management in the cases of cash advance or wire transfer advance. If an organization is using both ways for the advances, then the best setting is to have 1 (posting only in request approved status) in column 2 of the Other Settlement row relevant for wire transfer advances and enter 2 (posting only in trip approved status) in column 7 of the Other Settlement row relevant for cash advances so that travel expense settlement always posts to employee vendor net of advance (refer back to Figures 2, 9, and 12). This configuration ensures that advances are handled correctly and that no employees are overpaid.