SAP NewGL Config

8/11/2019 SAP NewGL Config

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New G/L Functionality in ERP 6.0

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BY:

Sakthy Murali

SAP FICO CONSULTANT

DEXLER INFORMATION SOLUTIONS PVT LTD




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Index

1. Abstract: ..................................................................................................................................................................... 3

2. Keywords: ................................................................................................................................................................... 3

3. Introduction: ................................................................................................................................................................ 3

4. New G/L Functionality Overview:................................................................................................................................ 3

5. Parallel Valuation: ....................................................................................................................................................... 5

Parallel Accounting: .................................................................................................................................................... 5

Segment Reporting: .................................................................................................................................................... 6

Scenario: .................................................................................................................................................................... 6

Document Splitting: .................................................................................................................................................... 7

Document Splitting Characteristics: ............................................................................................................................ 8

Zero Balance Indicator: .............................................................................................................................................. 8

Mandatory Field: ......................................................................................................................................................... 8

Drilldown Reporting for Segments: ............................................................................................................................. 8

6. Real Time Integration with CO:................................................................................................................................... 9

7. Fast Close: ................................................................................................................................................................. 9

8. Figure 7 : Success story of XYZ Ltd (India), which migrated to the New G/L functionality ....................................... 10

9. Summary: ................................................................................................................................................................. 10

10. References: .............................................................................................................................................................. 10




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1. Abstract:

In this topic, we would discuss about the New G/L Functionality and its advantages.

2. Keywords:

Parallel Accounting

Segment

Scenario

Document Splitting

3. Introduction:

The New G/L Functionality in ERP 6.0 came as a solution to the customers who were finding it difficult to operate different comp

meet the international/industry-specific standards. The increasing importance of IAS/IFRS also heightened the need for improved

4. New G/L Functionality Overview:

New G/L in SAP 6.0 is a unified world compared to the multiple applications supported by the Classic G/L in SAP R/3 enterpris

combination of Classic G/L and the Special Purpose Ledger.

From the classic G/L, the enhancements done to the New G/L are given below:

Parallel Valuation

Segment Reporting

Real Time Integration with CO

Fast Close

Some of the advantages of the New G/L are:

New G/L facilitates a single unified solution. This does not require a separate cost of sales ledger, special-purpose ledger, rec

ledger or a profit-center ledger;

• It enables a parallel valuation which can meet the legal requirements (IAS/GAAP);

• The New G/L has expedited the tedious reconciliation process between various ledgers;




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• It facilitates multi-dimensional reporting with very less manual effort;

• It enables Transparency.

Figure 1

Online Split

Dr. Cr.1000

X 600

Y 400

Dr. Cr.

X 600

Y 400

X 600Y 400

L6 (Leading Ledger

– For IFRS)

0L (Non-leadingledger for US GAAP)




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5. Parallel Valuation:

The New G/L supports Parallel Accounting by using either parallel accounts or parallel ledgers. This choice depends on the

scenario. Both the selections are equally effective and competent.

Parallel Accounting:

Parallel Accounting enables you to perform valuations and closing preparations for a company code according to the accounting p

For example, let us assume a US Subsidiary is headquartered in India. The company has to create financial statements accord

(Indian Accounting Standards) as well as US GAAP. So, Parallel Accounting is a solution for managing two parallel accounting pr

Primary Process (Invoices, Payments, and day-today transactions): Parallel Accounting refers to a single document, which is crea

parallel ledgers for primary process. The fiscal year variant may differ from one ledger to another.

Secondary Process (Currency Valuation, Carry Forward etc): Parallel documents are created ledger-wise. There can be differenfor the valuation, fiscal year variant and for any other selected dimensions.

Parallel Accounting by using Parallel Ledgers:

The New G/L allows any number of ledgers. New G/L enables:

Postings in one ledger

Postings into multiple ledgers

Figure 2




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Segment Reporting:

A segment is a division of a company for which you can create financial statements for external reporting. Typically, compa

Segments if there are too many profit centers or if the profit centers are engaged in other activities.

Segment reporting is aimed to give a detailed insight of the various business activities in a company. Segment reporting

understand the performance of the company, forecast and anticipate the revenues and risks respectively.

The accounting principles US GAAP and IFRS require companies to perform segment reporting.

US GAAP requires a complete balance sheet at the segment level. The segment is defined as a subarea of a company with acti

are regularly used by management for profit assessment and resource allocation purposes.

IFRS also has the same requirements for segment reporting as US GAAP.

The segment is derived from the Master record of the profit center. “Segment” is released only in combination with “Profit Cent

segment is specified manually during posting, it is determined rom the “Profit Center” master record. The business area or

centers can be used as alternatives.

The Segment Reporting is made possible only through:

Scenarios and

Document Splitting

Scenario:

‘A Scenario is a combination of customizing settings from different business views. Each business view specifies the posting data

transferred from different application components to the General Ledger Accounting’ - In simple words, a scenario decides w

would be updated in the General Ledger during a posting.

A ledger can be assigned to one or more scenarios;

You cannot define your own scenarios;

Segment is also one of the scenarios.




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Figure 3

Document Splitting:

Document Splitting is the pre-requisite for creating financial statements at any time for Segments. The system splits the documen

on the document splitting rules. The configuration of these rules would help split the document in the defined ratios.

There are two views of a document when the New G/L is active – Entry View and the General Ledger View. The Entry View is o

to the sub ledgers. Document splitting is relevant in the General Ledger View only.

A quick overview of the required steps in Document Splitting:

Activate Document Splitting – This activation is done at the client level. You can activate/deactivate document splitting for the

code(s) also.

Inheritance is activated – The name itself indicates the activity of “Inheritance”. If this field is activated, the entities projected i

item get inherited to the other line items as well.

Figure 4




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Document Splitting Characteristics:

The Customizing for “Document Splitting Characteristics” are used as per the dimensions for the required balance sheet

characteristics are based on the scenarios assigned to the ledger.

Zero Balance Indicator:

When this indicator is selected, the system creates additional clearing items to ensure that the document is balanced. This is an

field as it ensures a financial statement without inconsistencies.

Mandatory Field:

If this indicator is set, the “Document Splitting” becomes mandatory in all postings. This means that the system allows the post

the required account assignments (defined in a ledger) are defined.

Figure 5

Drilldown Reporting for Segments:

You can use standard drilldown reports for Segment Reporting. The given standard reports are available:

Segment : Actual/Plan/Variance

Segment: Plan/Plan/ActualSegment : Key Figures

Segment : Comparison : Return on Investment




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6. Real Time Integration with CO:

The SAP R/3 Financials was designed to manage both Financials (FI - Financial Accounting) and Controlling (CO - Man

Accounting). There was a clear-cut distinction between the two sub-processes. But over a period of time, they became more integ

it was tougher to distinguish the difference.

The New G/L enables the integration of FI and CO in real time. This has relegated the need of running the reconciliation run

during period-end closing. The faster period-end closings are evident in the Profit Center Accounting cross-cost-center controlling

that involve different profit centers.

Figure 6

7. Fast Close:

The New G/L has improved the closing process in a significant manner. The enhancements in the New G/L has automatically

the closing procedure, which otherwise is a tedious task. Some of the highlights which trigerred the Fast Close are:

Document Splitting and its Zero Balance Indicator that complete the reporting requirements at the time of posting itself;

No additional runs required for the reconciliation between FI and CO;

Ledger-Specific Postings/Postings according to the required accounting principles – These postings are very much relevant for th

process.




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8. Figure 7 : Success story of XYZ Ltd (India), which migrated to the New G/L functio

9. Summary:

We have discussed about the New G/L Functionality and its benefits in a compact overview. The New G/L component is op

existing customers. The SAP system offers the New G/L Accounting which is an interesting alternative in General Ledger Accou

mySAP ERP Central Component.

10. References:

http://service.sap.com

XYZ wanted to take advantage of the document splitting

features and the real-time integration between Financial

accounting and Controlling.

Result : XYZ can now automatically split accounting line

items per document for each company profit center.

Because of this, the period adjustments to the balance sheet

and profit and loss statement are not required. This means

that document splitting is done real time!!!

Take Home : Greater visibility of AR and AP through their

profit centers

Documents

SAP NewGL Config