G/L account determination
Structure ....................................................................................................................................................... 3
Account determination description in SAP B1: ..................................................................................... 3
=>Administration => Setup =>Financial =>G/L Account Determination ....................................................... 3
Sales tab ........................................................................................................................................................ 3
Permit Change of Control Accounts checkbox:..................................................................................... 3
Default Customer for A/R Invoice and Payment:.................................................................................. 3
Domestic and Foreign Accounts Receivable: ........................................................................................ 4
Checks Received:................................................................................................................................... 4
Cash on Hand: ....................................................................................................................................... 4
Overpayment and underpayment A/R Account: .................................................................................. 4
Payment Advances: ............................................................................................................................... 4
Realized Exchange Diff. Gain:................................................................................................................ 4
Cash Discount:....................................................................................................................................... 4
Revenue and sales credit Account: ....................................................................................................... 4
Purchasing tab............................................................................................................................................... 5
Domestic and Foreign Accounts Payable: ............................................................................................. 5
Realized Exchange Diff. Gain/Loss: ....................................................................................................... 5
Bank Transfer: ....................................................................................................................................... 5
Cash Discount:....................................................................................................................................... 5
Cash Discount Clearing: ........................................................................................................................ 5
Expense Account: .................................................................................................................................. 5
Purchase Credit Account: ...................................................................................................................... 5
Overpayment and underpayment A/P Account: .................................................................................. 5
Payment Advances: ............................................................................................................................... 6
Expense and Inventory Account: .......................................................................................................... 6
General tab ................................................................................................................................................... 6
Credit Card Deposit Fee: ....................................................................................................................... 6
Rounding Account: ................................................................................................................................ 6
Automatic Reconciliation Diff: .............................................................................................................. 6
Period-End Closing Account: ................................................................................................................. 6
Realized Exchange Diff. Gain/ Loss: ...................................................................................................... 6
Opening Balance Account: .................................................................................................................... 7
Inventory tab................................................................................................................................................. 7
Inventory: .............................................................................................................................................. 7
COGS: .................................................................................................................................................... 7
Allocation account: ............................................................................................................................... 7
Variance account: ................................................................................................................................. 7
Price Difference Account: ..................................................................................................................... 7
Negative Inv. Adjustment Acct: ............................................................................................................ 7
Inventory Offset – Decrease Acct: ........................................................................................................ 7
Inventory Offset – Increase Acct:.......................................................................................................... 8
Sales returned account: ........................................................................................................................ 8
Exchange Rate Differences Account ..................................................................................................... 8
Good clearing account: ......................................................................................................................... 8
G/L Decrease/Increase Account: .......................................................................................................... 8
WIP Inventory Account ......................................................................................................................... 8
WIP Inventory Variance Account: ......................................................................................................... 8
Expense clearing account:..................................................................................................................... 8
Stock in Transit Account: ...................................................................................................................... 9
Warehouse / item group setup..................................................................................................................... 9
Expense account: .................................................................................................................................. 9
Revenue account:.................................................................................................................................. 9
Inventory: .............................................................................................................................................. 9
COGS: .................................................................................................................................................... 9
Allocation account: ............................................................................................................................... 9
Variance account: ................................................................................................................................. 9
Price Difference Account: ................................................................................................................... 10
Negative Inv. Adjustment Acct: .......................................................................................................... 10
Inventory Offset – Decrease Acct: ...................................................................................................... 10
Inventory Offset – Increase Acct ......................................................................................................... 10
Sales returned account: ...................................................................................................................... 10
Exchange Rate Differences Account: .................................................................................................. 10
Good clearing account: ....................................................................................................................... 10
G/L Decrease/Increase Account: ........................................................................................................ 11
WIP Inventory Account: ...................................................................................................................... 11
WIP Inventory Variance Account ........................................................................................................ 11
Expense clearing account:................................................................................................................... 11
Stock in Transit Account: .................................................................................................................... 11
Sales Credit Account: .......................................................................................................................... 11
Purchase Credit Account: .................................................................................................................... 11
Structure
In the following document the description and explanation will follow this structure:
Account determination description in SAP B1: Explanation and where use (=>in which window the
account will appear automatically) (Journal entry explanation) [Account type and usual location in
drawer]
=>Administration => Setup =>Financial =>G/L Account Determination
Note: This determination can be set by fiscal year.
Sales tab
Permit Change of Control Accounts checkbox: Select if you want to assign different control
accounts to different customers. Assigning control accounts to each customer is done in the Business
Partner Master Data window. If this option is not selected, the control accounts defined in the Control
Accounts – Accounts Receivable window are used for all customers.
Default Customer for A/R Invoice and Payment: If you perform one-time sales (when the
payment is made at the same time that the A/R invoice is generated), enter the code of the one-time
customer, to which you will generate the A/R invoice + payment document whenever a one-time sale is
made. (=>A/R Invoice + Payment)
Domestic and Foreign Accounts Receivable: Control accounts for posting sales to domestic
and/or foreign customers. SAP Business One posts all sales to customers to this control account, making
your current total sales available at any time. The foreign account will be automatically changed as
default if the country in the bill-to address of the customer is different from the country in which the
company is located. (=>DT on A/R invoice and CT on incoming payment) [Should be an asset account in
the current section]
Checks Received: temporary accounts for posting check from customer. Will reflect check in your
“drawer” not deposited to the bank. It will also contain post dated check. (=>Payment mean/Check tab)
[Should be an asset account in the current section]
Cash on Hand: temporary accounts for posting customer payments in cash. Will reflect cash in your
“drawer” not deposited to the bank. It can also be the petty cash account if the deposit is done that
way. (=>Payment mean/Cash tab) [Should be an asset account in the current section]
Overpayment and underpayment A/R Account: Define these accounts if you want SAP Business
One to handle cases in which the incoming payment amount is slightly different from the A/R invoice(s)
amount paid. SAP Business One compares the amount paid to the amount due, and if the difference is
less than the amount defined in: Administration /System Initialization /Document Settings /Per
Document/ Incoming Payment / Under & Overpayment Amt Allowed field, the application automatically
creates the appropriate transaction. (=>DT or CT at incoming payment) [Can be an expense/revenue
account in the revenue, financial or other section drawer]
Payment Advances: Default clearing account to be used when adding A/R down payment invoices. G/L
accounts defined as control accounts cannot be selected. (=>CT at A/R invoice down payment) [Should
be a deferred revenue account in the liability drawer] Note: this amount will be reverse when the final
invoice will be produced link with this down payment
Realized Exchange Diff. Gain: Select accounts to be used as default accounts for journal entries
created to reflect loss and gain caused by exchange rate differences in sales documents. This happened
when there is a rate difference between the invoice and the payment. (=>DT or CT at incoming
payment) [Should be an expense/revenue account in the cost of goods sold, financial or other section
drawer]
Cash Discount: Define an account to be used as the default when a cash discount is used like 2% in 10
days. (=>DT at incoming payment) [Should be a revenue account in the revenue drawer] Note: can also
be treated as an expense account in the financial or other drawer by some client.
Revenue and sales credit Account: Default revenue account used when there is no other account
determination done elsewhere. (=>CT at A/R invoice) [Should be an expense account in the revenue
drawer] Note: can also be treated as an expense account in the financial or other drawer by some
client.
Purchasing tab
Domestic and Foreign Accounts Payable: Control accounts for posting purchasing to domestic and
foreign vendors. SAP Business One posts all purchasing to vendor to this control account, making your
current total purchase available at any time. The foreign account will be automatically changed as
default if the country in the bill-to address of the vendor is different from the country in which the
company is located. (=>A/P invoice Credit account in the JE) [Should be an liability account in the current
section]
Realized Exchange Diff. Gain/Loss: Select accounts to be used as default accounts for journal
entries created to reflect loss and gain caused by exchange rate differences in purchasing documents.
This happened when there is a rate difference between the invoice and the payment. (=>DT or CT at
incoming payment) [Can be an expense/revenue account in the cost of goods sold, financial or other
section drawer]
Bank Transfer: Default account used when paying by bank transfer. (=>CT at outgoing payment; will
automatically populate the account in the bank transfer tab in the payment means window) [Should be
a cash account in the asset drawer in the short term section]
Cash Discount: Define an account to be used as the default when a cash discount is used like 2% in 10
days. (=>CT at outgoing payment) [Should be an expense account in the cost of sale drawer] Note: can
also be treated as an expense account in the financial or other drawer by some client.
Cash Discount Clearing: Only use when the net procedure is selected in an A/P reserve invoice. The
net procedure allow the recognized the discount available before the payment. The net procedure
enables recording in advance of any future discount available from purchases. In this approach, the
debiting account for the purchase is automatically reduced by the amount of the future discount. (=>CT
at A/P reserve invoice) [Should be an expense account in the cost of sale drawer]
Expense Account: Default account used when non-inventory item are purchased in a periodic system
or when an item type A/P invoice is done in a non-periodic inventory system. In a periodic inventory this
account will be used only if the set G/L account by is set at the item level. (=>CT at A/P invoice) [Should
be an expense account in the cost of sale drawer] Note: can also be treated as an expense account in
the expense or other drawer.
Purchase Credit Account: account to be used for non-inventory item in A/P credit memo document.
(DT at A/P invoice and CT at receipt from production) [Should be a profit and loss account in the cost of
sale drawer]
Overpayment and underpayment A/P Account: Define these accounts if you want SAP
Business One to handle cases in which the outgoing payment amount is slightly different from the A/P
invoice(s) amount paid. SAP Business One compares the amount paid to the amount due, and if the
difference is less than the amount defined in: Administration/System Initialization/Document
Settings/Per Document/Outgoing Payment/ Under & Overpayment Amt Allowed field, the application
automatically creates the appropriate transaction. (=>DT or CT at outgoing payment) [Can be an
expense/revenue account in the cost of sales, financial or other section drawer]
Payment Advances: Account use as a clearing account when adding an A/P down payment invoice.
G/L accounts that are defined as control accounts cannot be selected. (=>DT at A/R invoice down
payment CT when down payment fully paid will be applied against final invoice) [Should be an “other
receivable” account in the asset drawer in the current section] Note: will be reverse when down
payment fully paid will be applied against final invoice.
Expense and Inventory Account: Only use in moving average. This account is used only for the
Moving Average Valuation method when Inventory items are drawn from A/P Invoice into A/P Credit
Memo and there is a difference between the item price in the base document and the item price in the
target document. In such case the Inventory account is being credited for the original item price as
appears in the A/P Invoice and the Expense and Inventory account is debited for the price difference
between the Inventory posting and the item price in the A/P Credit Memo. In addition, this account is
used for the following scenarios: A/P Credit Memo based on goods returns and A/P Credit Memo based
on A/P Reserve invoice.. (=>DT at A/P Credit memo)[Should be an expense account in the Cost of sales
drawer]
General tab
Credit Card Deposit Fee: Account to be used for the credit card fees/commission paid to VISA or
Master card entered in the deposit voucher for a credit card commission fee field. (=>DT at deposit)
[Should be a revenue account in the revenue drawer] Note: can also be treated as an expense account
in the financial or other drawer by some client.
Rounding Account: Default account used in journal entries created for rounding differences. This may
occur when you define rounding for certain currencies. [Can be a revenue/expense account in the cost
of sales, expense, financial or other drawer]
Automatic Reconciliation Diff: Determines the account to use for the Automatic Balancing
Transaction in Automatic Reconciliation. [Can be a revenue/expense account in the cost of sales,
expense, financial or other drawer]
Period-End Closing Account: Default account used when performing the period end closing process.
(=>DT or CT at period end) [Have to be an earning account in the equity drawer] Note: Will be reverse to
0$ at the beginning of the next period
Realized Exchange Diff. Gain/ Loss: When reconciling transactions of foreign currency G/L
accounts, an exchange rate differences transaction is performed automatically. Define here the account
to which the gained exchange rate difference is posted. (=>DT or CT at internal reconciliation) [Can be an
expense/revenue account in the cost of goods sold, financial or other section drawer]
Opening Balance Account: Will populate automatically the account in the windows =>
Administration/Opening balance/ G/L Accounts Opening Balance and Business Partners Opening Balance
[Should be a revenue/expense account in the other revenue and expense drawer]
Inventory tab
Inventory: Inventory account used in good receipt PO, delivery, inventory transfer and production
order. (=>DT on receipt CT on delivery) [Have to be an asset account in the current section of the asset
drawer]
COGS: Offsetting account to the Stock account used in Deliveries and A/R Invoices, and to the Returning
account used in A/R Returns and A/R Credit Memos. (=>DT on delivery) [Have to be an expense account
in the cost of sales drawer]
Allocation account: This clearing account is used as an offsetting account to the inventory account in
Goods Receipt POs and Good return. The balance of this G/L account reflects the total amount of opens
Goods Receipt POs and Goods Returns. It is an accrued account just for inventory. (=>CT on good
receipt and DT on A/P invoice) [Have to be a liability account in the current section in the liabilities
drawer]
Variance account: This G/L account is using only in a Standard Price inventory system. When there
are differences between the standard price and the purchase price in a purchasing document, these
differences will be recorded in the Variance account. (=>DT or CT on good receipt or A/P invoice)
[Should be an expense account in the cost of sales drawer]
Price Difference Account: This G/L account will be called when this scenario happened: there is a
price difference per unit between the good receipt PO and the A/P invoice and some items from this
purchase were sold before entering the A/P invoice. Which could also happened if landed cost is used.
So the difference in price per unit time the number of unit sold before entering the invoice will go in this
account. Items not sold yet will be adjusted in the inventory value. (=>DT or CT at A/P invoice) [Should
be an expense account in the cost of sales drawer]
Negative Inv. Adjustment Acct: This account is used only if negative inventory is possible
(Administration/System initialization/Document setting/general tab/Block Negative Inventory checkbox
is uncheck) and if we are in FIFO and moving average. The account will be called when the inventory is
negative and we buy this item at a different price then the last price purchased. (=>DT or CT at A/P
invoice) [Should be an expense account in the cost of sales drawer]
Inventory Offset – Decrease Acct: This is an offsetting account to the Stock account used in Goods
Issues and negative difference in inventory postings adjustments. Happen when there is difference
between the inventory listing and the real inventory. (Inventory/Inventory transaction/ Initial
Quantities, Inventory Tracking, and Inventory Posting/Inventory posting tab). (=>DT at Good issue and
inventory posting) [Should be an expense account in the cost of sales drawer]
Inventory Offset – Increase Acct: This is an offsetting account to the Stock account used in Goods
Receipt and positive difference in inventory postings adjustments. Happen when there is difference
between the inventory listing and the real inventory. (Inventory/Inventory transaction/ Initial
Quantities, Inventory Tracking, and Inventory Posting/Inventory posting tab). (=>CT at Good receipt and
inventory posting) [Should be an expense account in the cost of sales drawer]
Sales returned account: This is an inventory account used in A/R Returns and A/R Credit Memos. The
same account as the usual Inventory Account can be used or create another inventory account. The
Inventory account balance + the inventory Sales Returns account balance reflect the total stock value.
(=> CT on good return and A/R credit memo) [It has to be a balance sheet account in the asset drawer].
Exchange Rate Differences Account: This G/L account will be called only when this scenario
happened: there is an exchange rate difference between the good receipt PO and the A/P invoice and
some items from this purchase were sold before entering the A/P invoice. So the difference in price
caused by the exchange rate difference time the number of unit sold before entering the invoice will go
in this account. Items not sold yet will be adjusted in the inventory value. (=>DT or CT at A/P invoice)
[Should be an expense account in the cost of sales drawer]
Good clearing account: an offsetting account used when closing Goods Receipt POs or Goods Returns.
In this case the system will clear the amount in the allocation account (Inventory received not invoice)
link to this good receipt PO and will offset the amount to this good clearing account. (=>CT at good
receipt PO closing and DT at good return closing) [Should be an expense account in the cost of sales
drawer]
G/L Decrease/Increase Account: An offsetting account to the inventory account used in material
revaluation transactions where the price decreases or increase. (=> Inventory/ Inventory Transactions/
Inventory Revaluation) (DT or CT at inventory revaluation) [Should be an expense account in the cost of
sales drawer]
WIP Inventory Account: An offsetting account to the inventory account used in the production
process and reflects the value of the Production Order during its various stages. (DT on material issue
and CT on production receipt) [Has to be a balance sheet account in the current section of the asset
drawer]
WIP Inventory Variance Account: This account is called when we close a production order and there
is a variance (adding an item) after receiving the production. This variance will appear in the summary
tab of a production order. (DT when closing the production order) [Has to be an expense account in the
cost of sale drawer]
Expense clearing account: If you choose to affect the stock with additional expenses you need to
specify an offsetting G/L account to the Inventory account for clearing journal entries created by A/P
Invoices and Goods Receipt PO. Will reflect all additional expenses in good receipt PO’s opened. (CT at
good receipt PO and DT at A/P invoice) [Should be a balance sheet account in the current section of the
liability drawer]
Stock in Transit Account: account to be used specially for A/P Reserve Invoice in order to distinguish
item paid not received yet from stock received not paid yet (good receipt PO). This new account enables
you to distinguish between transactions of A/P Credit Memo that are based on regular A/P Invoices and
A/P Credit Memos that are based on A/P Reserve Invoices. (DT at A/P reserve invoice and CT at good
receipt PO or A/P credit memo) [Has to be a balance sheet account in the current section near the
prepaid account in the asset drawer] Note: the description of the account should be something like:
“Inventory paid not received”
In the Item master data we can define the Set G/L Accounts By in the inventory tab. Depending on this
setup you will have to define the warehouse or the item group setup.
Warehouse / item group setup
Expense account: account to be used for non-inventory item in purchasing document. It is also used in
the production process when we add non-inventory item like labor in a bill of material. (DT at A/P
invoice and CT at receipt from production) [Should be a profit and loss account in the cost of sale
drawer]
Revenue account: account used for all income incurred by sales documents. (CT at A/R invoice)
[Should be a profit and loss account in the sales drawer]
Inventory: Inventory account used in good receipt PO, delivery, inventory transfer and production
order. (=>DT on receipt CT on delivery) [Have to be an asset account in the current section of the asset
drawer]
COGS: Offsetting account to the Stock account used in Deliveries and A/R Invoices, and to the Returning
account used in A/R Returns and A/R Credit Memos. (=>DT on delivery) [Have to be an expense account
in the cost of sales drawer]
Allocation account: This clearing account is used as an offsetting account to the inventory account in
Goods Receipt POs and Good return. The balance of this G/L account reflects the total amount of opens
Goods Receipt POs and Goods Returns. It is an accrued account just for inventory. (=>CT on good
receipt and DT on A/P invoice) [Have to be a liability account in the current section in the liabilities
drawer]
Variance account: This G/L account is used only in a Standard Price inventory system. When there
are differences between the standard price and the purchase price in a purchasing document, these
differences will be recorded in the Variance account. (=>DT or CT on good receipt or A/P invoice)
[Should be an expense account in the cost of sales drawer]
Price Difference Account: This G/L account will be called only when this scenario happened: there is
a price difference per unit between the good receipt PO and the A/P invoice and some items from this
purchase were sold before entering the A/P invoice. So the difference in price per unit time the
number of unit sold before entering the invoice will go in this account. Items not sold yet will be
adjusted in the inventory value. (=>DT or CT at A/P invoice) [Should be an expense account in the cost of
sales drawer]
Negative Inv. Adjustment Acct: This account is used only if negative inventory is possible
(Administration/System initialization/Document setting/general tab/Block Negative Inventory checkbox
is uncheck) and if we are in FIFO and moving average. The account will be called when the inventory is
negative and we buy this item at a different price then the last price purchased. (=>DT or CT at A/P
invoice) [Should be an expense account in the cost of sales drawer]
Inventory Offset – Decrease Acct: This is an offsetting account to the Stock account used in Goods
Issues and negative difference in inventory postings adjustments. Happen when there is difference
between the inventory listing and the real inventory. (Inventory/Inventory transaction/ Initial
Quantities, Inventory Tracking, and Inventory Posting/Inventory posting tab). (=>DT at Good issue and
inventory posting) [Should be an expense account in the cost of sales drawer]
Inventory Offset – Increase Acct: This is an offsetting account to the Stock account used in Goods
Receipt and positive difference in inventory postings adjustments. Happen when there is difference
between the inventory listing and the real inventory. (Inventory/Inventory transaction/ Initial
Quantities, Inventory Tracking, and Inventory Posting/Inventory posting tab). (=>CT at Good receipt and
inventory posting) [Should be an expense account in the cost of sales drawer]
Sales returned account: This is an inventory account used in A/R Returns and A/R Credit Memos. The
same account as the usual Inventory Account can be used or create another inventory account. The
Inventory account balance + the inventory Sales Returns account balance reflect the total stock value.
(=> CT on good return and A/R credit memo) [It has to be a balance sheet account in the asset drawer].
Exchange Rate Differences Account: This G/L account will be called only when this scenario
happened: there is an exchange rate difference between the good receipt PO and the A/P invoice and
some items from this purchase were sold before entering the A/P invoice. So the difference in price
caused by the exchange rate difference time the number of unit sold before entering the invoice will go
in this account. Items not sold yet will be adjusted in the inventory value. (=>DT or CT at A/P invoice)
[Should be an expense account in the cost of sales drawer]
Good clearing account: an offsetting account used when closing Goods Receipt POs or Goods Returns.
In this case the system will clear the amount in the allocation account (Inventory received not invoice)
link to this good receipt PO and will offset the amount to this good clearing account. (=>CT at good
receipt PO closing and DT at good return closing) [Should be an expense account in the cost of sales
drawer]
G/L Decrease/Increase Account: An offsetting account to the inventory account used in material
revaluation transactions where the price decreases or increase. (=> Inventory/ Inventory Transactions/
Inventory Revaluation) (DT or CT at inventory revaluation) [Should be an expense account in the cost of
sales drawer]
WIP Inventory Account: An offsetting account to the inventory account used in the production
process and reflects the value of the Production Order during its various stages. (DT on material issue
and CT on production receipt) [Has to be a balance sheet account in the current section of the asset
drawer]
WIP Inventory Variance Account: This account is called when we close a production order and there
is a variance (adding an item) after receiving the production. This variance will appear in the summary
tab of a production order. (DT when closing the production order) [Has to be an expense account in the
cost of sale drawer]
Expense clearing account: If you choose to affect the stock with additional expenses you need to
specify an offsetting G/L account to the Inventory account for clearing journal entries created by A/P
Invoices and Goods Receipt PO. Will reflect all additional expenses in good receipt PO’s opened. (CT at
good receipt PO and DT at A/P invoice) [Should be a balance sheet account in the current section of the
liability drawer]
Stock in Transit Account: account to be used specially for A/P Reserve Invoice in order to distinguish
item paid not received yet from stock received not paid yet (good receipt PO). This new account enables
you to distinguish between transactions of A/P Credit Memo that are based on regular A/P Invoices and
A/P Credit Memos that are based on A/P Reserve Invoices. (DT at A/P reserve invoice and CT at good
receipt PO or A/P credit memo) [Has to be a balance sheet account in the current section near the
prepaid account in the asset drawer] Note: the description of the account should be something like:
“Inventory paid not received”
Sales Credit Account: account used for A/R credit memo documents. (DT at A/R credit memo)
[Should be a profit and loss account in the sales drawer]
Purchase Credit Account: account to be used for non-inventory item in A/P credit memo document.
(DT at A/P invoice and CT at receipt from production) [Should be a profit and loss account in the cost of
sale drawer]