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author's profile photo Former Member
Former Member

GL account structure for Banks

Hello folks,

<b>Points available.</b> I have read in a few places (SAP and "Configuring FI/CO" by Hurst & Nowak) that the best way to configure Manual or Electronic Bank stmts is by having a GL acct structure where there must be only 1 confirmed cash G/L acct with several bank clearing accts. For example,

GL Act. Descrip

100500 Main Bank Acct 1234567890

100501 INCOMING WIRES

100502 INCOMING CHECKS

100503 INCOMING ACH

100504 INCOMING LOCKBOX

100505 OUTGOING WIRES

100506 OUTGOING CHECKS

100507 OUTGOING ACH

I have several questions:

<b>Is the structure above the best way? If yes, why? Is it because it is easier to audit?</b>

My clients Bank GL structure is so confusing that I am finding it difficult to configure MBS, particularly where we have to Assign Accounts to Acct Symbols. <b>Can I suggest to them that we change the structure?</b>

How could I justify to them that it needs to change? Is this what SAP recommends?

Thanks!

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3 Answers

  • Best Answer
    author's profile photo Former Member
    Former Member
    Posted on Sep 27, 2007 at 11:24 PM

    I have not seen ur clients bank accounts struture. If i had an oppurtunity I would have certainily given my comments. U have taken every aspect of payment like wire, lockbox, Check & ACH both for Incoming and Outgoing. They will be flowing to individual accounts and there will not be any confusion what so ever with regard to flow of values to these accounts.

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    • Hi,

      The main account should always reflect the bank statement.

      The sub-accounts have 2 main categories.

      a) In transit items - items that from accounting viewpoint have to be reported eg checks issued, but not yet cashed.

      b) Clearing accounts for EBS - These are set up so that the main account balance is always correct, even when the item can not be fully processed.

      eg there is an incoming payment, but with insufficient details for the system to determine the customer. In this case with sub-accounts the system would post:-

      Dr Bank

      Cr Clearing incoming payments

      Without sub-accounts no posting would be created and the main account balance would be incorrect.

      The sub-accounts have to be structured so that the symbolic accounts can be properly defined. How many you use depends on the business requirements.

      Theorectically you only need 2 ( in transit & EBS clearing), but this is inadvisable

      as it makes error checking and reconcilliations difficult.

      Kind regards

  • author's profile photo Former Member
    Former Member
    Posted on Sep 27, 2007 at 11:19 PM

    > Hello folks,

    >

    > <b>Points available.</b> I have read in a few places

    > (SAP and "Configuring FI/CO" by Hurst & Nowak) that

    > the best way to configure Manual or Electronic Bank

    > stmts is by having a GL acct structure where there

    > must be only 1 confirmed cash G/L acct with several

    > bank clearing accts. For example,

    >

    > GL Act. Descrip

    > 100500 Main Bank Acct 1234567890

    > 100501 INCOMING WIRES

    > 100502 INCOMING CHECKS

    > 100503 INCOMING ACH

    > 100504 INCOMING LOCKBOX

    > 100505 OUTGOING WIRES

    > 100506 OUTGOING CHECKS

    > 100507 OUTGOING ACH

    >

    > I have several questions:

    > <b>Is the structure above the best way? If yes, why?

    > Is it because it is easier to audit?</b>

    >

    > My clients Bank GL structure is so confusing that I

    > am finding it difficult to configure MBS,

    > particularly where we have to Assign Accounts to Acct

    > Symbols. <b>Can I suggest to them that we change the

    > structure?</b>

    >

    > How could I justify to them that it needs to change?

    > Is this what SAP recommends?

    >

    > Thanks!

    <b>This struture looks pretty good. U can go ahead with this struture.</b>

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  • author's profile photo Former Member
    Former Member
    Posted on Sep 28, 2007 at 03:44 PM

    Kamal & Dominic,

    Thanks for your responses. I think I am now beginning to understand the usefulness of the sub accts.

    I really appreciate your thoughts.

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