Overview on New G/L Accounting
New G/l is a very competitive in increasingly global economy and increased the demands for varied reports due to various regulatory changes and related businesses. New G/L overcomes shortcoming of traditional accounting by providing single robust application with unified interface which caters both the needs of financial and management accounting.
The New G/L approach is developed to accommodate the numerous requirements for legal, managerial, country, and local accounting needs. Basically, it brings together much of the reporting and analysis which earlier used to done separately by different components in classical G/L system like FI-CO reconciliation, special purpose ledger, COGS.
SAP incorporates additional functionality in New G/L that will offer information on the go which otherwise were obtained by other components in classic SAP like Cost of Sales Ledger, reconciliation ledger to reconcile between FI and CO data, Special Purpose Ledger.
In this way, the New G/L Accounting serves as a complete record of all business transactions. Central and up-to-date component for reporting where all posted transactions can be checked in real time.
Benefits with New General Ledger Accounting
New G/L provides new and improved functionality, flexibility with document splitting, parallel accounting, segment reporting, and real time improved integration with other applications and SAP modules.
New G/L and Classic G/L
In the classical approach, users had to retrieve information through various areas or applications, such as the special purpose ledger, COGS ledger.
Below picture gives you a view how SAP has moved/transformed from Classical G/L to New G/L with taking all the multiple application to one unified world i.e. New G/L Accounting. Sap has integrated all the application to save time, money, efforts and more important to provide reports and information as required for various internal and external purposes.
(1) Flexibility
SAP consolidated multiple totals table (GLT0, GLPCT) in classic G/L into a single Totals table named FAGLFLEXT in New G/L. With one Table, it provides flexibility and faster response time for reporting.
(2) Reconciliation Automated
Reconciliation in classical G/L used to take several weeks or months but with New G/L many reconciliation process has been automated like reconciliation of FI-CO.
(3) Segment reporting
New G/L has document splitting functionality that enables segment reporting. Segment Reporting functionality is not available in Classic G/L.
(4) Real Time Integration between FI and CO in New G/L
(5) Parallel Accounting
New G/L provides Leading and Non-leading ledgers for parallel accounting like IFRS and GAAP so as to have financial statements as per different legal and accounting regulations.
(6) Faster Period Closing
Faster Period Close with New G/L such as,
a. Reconciliation Ledger is not required
b. Financial Statement adjustment are no more required
d. Activities related to Special Purpose Ledger are not required
e. Depreciation posting can be done online
(7) Flexible Drill-down Reporting in New G/L
Totals Table
Totals table is a database table in which totals records are stored. In New G/L SAP delivers the totals table FAGLFLEXT in the standard system.
Once New General Ledger Accounting is activated, totals records in G/L are updated in the totals table FAGLFLEXT.
FAGLFLEXT updates more entities than that of the classic totals table (GLT0). FAGLFLEXT has total of 142 fields which include all majorly used fields like Company Code, G/L Number, Cost Center, Profit Center, Business Areaand many more in one table.
Configuration Steps:
- Creating Company Code
- Activation of New G/L
- Ledger
- Parallel Accounting
- Document Splitting
- Document Type
- Segment
Configuration Steps:
1. Create Company Code
IMG Menu: Enterprise Structure --- Definition --- Financial Accounting (New)--- Edit, Copy, Delete, Check Company Code
Click on New Entries button:
Click on Save.
New tab will come up, fill the details as below:
Click on Save.
2. Activation of New G/L
For new implementation projects, new General Ledger Accounting is activated by default in SAP system. Whereas, if existing customers want to use New General Ledger Accounting, they first need to migrate from classical to New G/L which is a separate project in itself.
Just to show you how to activate New G/L if it is not yet activated, but do not try this in a production system.
This is the first activity which you need to do for new G/L accounting. In the case of existing customer this must be last step after completion of new G/L migration project. As you activate new G/L, it results in wide changes to the SPRO customization path and table structures.
Continuing to New G/L Accounting Part-2, the next level of configuration is Ledger. Follow the next link New General Ledger Accounting Part-2
Appreciate to have your views, comments and suggestions.
Thanks and Regards,
Mukesh Sharma