Rounding

The rounding method is applied to the decimals that exceed the number of decimals specified for the numeric format.

For example, if the value is 28.34875 and the number of decimals for the numeric format is set to 2, the rounding method applies to the decimals 875. Depending on the rounding method, the result is 28.35 or 28.34.

You can specify the way calculated amounts must be rounded for the following situations:

• Currency rounding

  LN rounds calculated amounts according to the rounding factor defined for the currency in the Currencies (tcmcs0102m000) session. The amounts are rounded to the nearest multiple of the rounding factor. For most currencies, a rounding factor of 0.01 is used.

  LN applies this type of rounding to all calculated amounts.

• Rounding of tax amounts

  After the currency rounding, tax amounts are rounded again, this time according to the rounding method selected for the tax code in the Tax Code by Country (tcmcs0136s000) session. The rounding method for tax amounts can be Down, Normal, or Up. For more information, refer to Rounding Method.

• Rounding of grand total amounts

  In some countries, the total amounts on legal documents that you send to your customers must be rounded in a specific way. For example, In Switzerland, total amounts on sales invoices in Swiss francs must be rounded to 0.05 francs.

  To meet this requirement, you can define a grand total rounding factor. For more information, refer to Grand total rounding

Rounding differences

If rounded amounts are posted, to balance the accounts, LN posts the rounding differences to the ledger accounts and dimensions you defined for rounding differences in the Finance Company Parameters (tfgld0503m000) session.

The following differences exist between currency rounding and grand total rounding:

• Currency rounding

  LN calculates the rounding difference that results from currency rounding as follows:

  Rounding difference = Sum of all rounded amounts for debit lines - sum of all rounded amounts for credit lines per currency in a document.

  Currency rounding differences are posted when you finalize the transactions in the General Ledger.

• Grand total rounding

  LN calculates the rounding difference that results from grand total rounding as follows:

  Rounding difference (grand total rounding) = Invoice amount rounded with normal rounding - invoice amount rounded with grand total rounding.

  Currency rounding differences are posted when you post the invoices in Invoicing.