GL Accounts in SAP: What do all these fields do??

The gentleman in charge of setting up all of the GL accounts at work and I were chatting about a
conversion and he commented to me “I don’t know what all of these settings do. I just follow the
instructions that you guys gave me.” It dawned on me that many people do not know what all of the
settings on an account do, but making mistakes here can cause serious trouble down the line.

Structure of a GL Account

SAP divides the GL master into two parts. First, each GL account is created inside of a single chart of
accounts. That chart of accounts is assigned to one or more company codes. Second, the account is
extended to each company code. If the account is not extended to the individual company code, it
cannot be posted to in the company code. Thus, some characteristics are constant across all company
codes (since they are set in the chart of accounts data), while others are different in each company
code.

Settings in the Chart of Accounts

Inside the chart of accounts we have the following settings:

# Field Description

The numbering scheme for the accounts should be rational and carefully structured.
G/L Account Many places will have a hierarchy of accounts that will correspond to the numbering
1
Number scheme. For instance, assets may start with 1, liabilities with 2, short term liabilities
with 22, and so on.

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# Field Description

If the account is marked as P&L, then the account will be pushed to retained earnings
P&L
2 during the year end rollforward. If the account is marked as a balance sheet account,
Indicator
then it will rollforward into the same account.

The account group controls which fields are available for use on the GL master as well
Account
3 as what number interval the account number is in. Often, the account group is used to
Group
help with reporting.

4 Text Fields The short text and long text provide a description of the account.

Trading The trading partner on an account will auto populate any posting against the account
5
Partner with the trading partner populated here.

Group The group chart of accounts is used to roll up different operational charts of accounts
6
account into a common standard across the enterprise.

Settings in the Company Code

The settings in the chart of accounts are straightforward. The company code settings though are not so
simple.

# Field Description

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# Field Description

The currency of the account. If the currency is the same as the company code's
Account local currency, then any document currency can be used when posting to the
1
Currency account. If not, then document currency must match that of the GL account. This
is used primarily with cash accounts.

This setting does not mean what you think it means. If this field is flagged, any
Only balances in document currency can be used with this account, but the document currency is
2
local currency immediately converted to the local currency and is not recorded in the tables.
This setting helps performance and complexity, but that detail is often necessary.

This key will specify where exchange rate variances should be posted to. This key
Exchange Rate
3 may not be necessary for exchange rate differences depending on the
Difference Key
configuration.

The tax category will enable the entry of a tax code on postings to this account.
4 Tax category
The type of tax or even individual tax can be specified.

This setting will enable postings to the account without a tax code if the tax
5 Posting w/o tax
category is set.

A reconciliation account is used to denote the balance that is supported by a

Alt Account The alternate account number is open for use. For simple migrations, it can be
7
Number used for legacy account numbers.

Tolerance Group Tolerance groups assign the maximum percentage or absolute amount that can
8
for GL Accounts be written off during open item clearing.

If an account goes through a clearing process where debits and credits should be
Open Item matched against one another, then it should be flagged as open item managed.
9
Managed This flag should be set for cash reconciliation accounts and any other clearing
accounts. It should not be set for reconciliation accounts.

This indicator enables display of the account's line items. That enables reporting
of the individual line items in entry view via transactions such as FAGLL03 or
10 Line Item Display
FBL3N. GL view is always line item enabled. Recon accounts, tax accounts, and so
on should not be flagged as line item displayed.

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# Field Description

The sort key controls how the assignment/allocation field is populated in SAP.
BSEG has an index by default on this field, so by properly populating the
11 Sort key
allocation field, then line item level reports will execute faster. SAP provides a set
of different rules for populating the allocation field. This is called the sort key.

Authorization The authorization group controls whether special security permissions are
12
Group necessary for posting to this account.

The accounting clerk on the account assigns responsibility for the account to a
13 Accounting Clerk
particular person.

On the Create/bank/interest tab, we have the following fields:

# Field Description

The field status group controls what fields are required, optional, and hidden
14 Field Status Group per account. In general, field statuses should be setup to only display the
necessary fields per account and not every field.

Post Automatically
15 If this field is set, the account cannot be posted to via manual transaction.
Only

Supplement Auto If this field is set, a post automatically only account can have additional
16
Postings characteristics such as profit center or cost center set manually during posting.

This field is used to classify the account's activity into current day cash
17 Planning level
forecasting

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 Relevant to cash
18 This field must be set to enable processing in current day cash forecasting
flow

This field is used to classify the account's activity into current day cash
19 Commitment Item
forecasting

The house bank will assign the GL account to a house bank. This field should be
20 House Bank
set for the confirmed cash account related to a house bank account.

The house bank account will assign the GL account to a house bank account.
House Bank
21 This field should be set for the confirmed cash account related to a house bank
Account
account.

The interest indicator controls whether the account should be considered for
22 Interest Indicator
automatic interest calculation.

Interest Calculation
23 This indicator determines how often interest should be applied on the account.
Frequency

In addition, there are several text fields on both the chart of accounts level information and the
company code level information that can be used to store what the account is being used for and any
other notes. In addition, the account can be translated into multiple languages as necessary.

I hope that this overview of the GL account provided more in-depth information on how the GL account
is used.

1. FSP0 or FS00 [↩]

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