How Rounding Precedence Hierarchy Is Determined

During the rounding process, the tax precision and minimum accountable unit details are derived from the tax setup. The rounding process derives the rounding rule and rounding level details through the predefined processing hierarchy involving:

Configuration owner tax options defined for the configuration owner and event class
Event class options for the event class
Party tax profiles of the parties or party sites as given in the rounding precedence of the configuration owner tax options or in the derived registration party
Tax

Settings That Affect Tax Rounding

Key parameters that influence the rounding of calculated tax amount are:

Tax precision: The number of decimal places to which to calculate the tax amount.
Minimum accountable unit: The smallest currency unit that a tax amount can have.
Rounding level: The transaction level at which the rounding is to be performed.
Rounding rule: The method that's used to round off the calculated taxes to the minimum accountable unit.

Options available for the rounding level are:

Header: Applies rounding to calculated tax amounts once for each tax rate per invoice.
Line: Applies rounding to the calculated tax amount on each invoice line.

Options available for the rounding rule are:

Up: the amount is rounded to the next highest minimum accountable unit.
Down: The amount is rounded to the next lowest minimum accountable unit.
Nearest: The amount is rounded to the nearest minimum accountable unit.

How Tax Rounding Is Determined

If you don't define configuration owner tax option settings for the combination of configuration owner and event class, the rounding process uses:

The default rounding level of the event class as per the ZX_EVNT_CLS_MAPPINGS table.
The default rounding rule of the tax.

If you defined a rounding precedence hierarchy in the configuration owner tax option settings for the combination of configuration owner and event class, the rounding process looks for a rounding level and rounding rule in this way:

Looks for rounding details in the party tax profiles of the parties and party sites involved in the transaction, according to the rounding precedence hierarchy.
If an applicable tax profile is found then uses the rounding level and rounding rule of the tax profile.
If the rounding level is at the header level then uses these values to perform the rounding. The process ends.

If the rounding level is at the line level then goes to step 6.
If an applicable tax profile isn't found then uses the rounding level setting of the configuration owner tax option.
If the configuration owner tax option rounding level is at the header level then uses the rounding rule that's set at the tax level for each tax of the transaction to perform the rounding. The process ends.

If the rounding level is at the line level then goes to step 6.
If the rounding level is at the line level then:
1. For each tax line, uses the rounding rule belonging to the tax registration of the party type derived from the Determine Tax Registration rule.
2. If a registration record doesn't exist for the registration party type, and if you didn't define configuration owner tax option settings for the combination of configuration owner and event class, then the rounding process uses the rounding rule that's set at the tax level to perform the rounding. The process ends.
3. If a registration record doesn't exist for the registration party type, and if you defined a rounding precedence hierarchy in the configuration owner tax option settings for the combination of configuration owner and event class, then the rounding process looks for a rounding rule in this way:
  1. Refers to the party or party site of the first-party type defined in the rounding precedence hierarchy.
  2. Uses the rounding rule of the party or party site tax registration, if defined.
  3. If a tax registration isn't defined, uses the rounding rule of the party or party site account site details, if defined.
  4. If a rounding rule isn't defined, uses the rounding rule of the party or party site tax profile, if defined.
  5. If a tax profile isn't defined, repeats the previous sub-steps for each rounding party in the rounding precedence hierarchy.
  6. If a rounding rule is found, uses this rounding rule to perform the rounding. The process ends.
  7. If a rounding rule isn't found, then uses the rounding rule that's set at the tax level to perform the rounding. The process ends.