When you need to account for finance operations of the business, and keep track of where the money is coming from and where it’s being spent, it’s critical allocations are made correctly.
The General Ledger account master in the Chart of Accounts (CoA) area contains all information necessary for the valid use of the accounts, for all company codes defined in your system. The CoA area also contains data that controls how accounts are created according to specific codes, as well as whether an account is a balance sheet or Profit & Loss statement. Therefore, your CoA deserves careful consideration when it comes to master data.
Getting your finance master records right is the foundation to proper reporting and accounting. Designated as such, it should be viewed not only from the bottom up for allocation, but also from the top down for reporting. Much like the qualities of architectural arches determine building structure, a properly defined Chart of Accounts establishes a robust framework for business management.
If you wish to define a substantial Chart of Accounts, or have frequent modifications to the CoA, managing this process can be cumbersome, even with the most sophisticated accounting system.
General Ledger account code maintenance is typically conducted through SAP transaction FS00 – General Ledger Account Master Record. There are other records that need to be maintained too, including information that relates to customers, suppliers, materials, banks and employees.
The General Ledger master data not only determines an account’s function, but also controls the posting of accounting transactions to the General Ledger. When you begin defining accounts, you often need to consider things like the length of the account number, the type of name you want to use (alphanumeric or just numeric), and whether you need more than one retained earnings account. The grouping of the accounts is also an important aspect of setting up the CoA.
Even if your system is very accommodating in terms of defining a surplus of data, in the long run, infinite flexibility in the absence of proper governance can hurt your master data quality.
Regard the Chart of Accounts as an enterprise asset
While you may not view your Chart of Accounts as an enterprise asset, your customer, vendor, material and employee data is likely regarded as a key business asset, because the business couldn’t function without it. Since financial accuracy stems from clean master data, your CoA should be viewed as a data asset as well. It is an asset that is critical to the business, and needs to be managed well in order to ensure proper accounting allocation.
If you regard your business data as an enterprise asset, then you need to put formal structure, policies, processes and people in place to protect and properly manage it. One unique aspect of a formal finance master data governance program is that it needs to be understood not only by those directly affected, but also by the entire organization. While this may seem intuitively obvious, a lot of pieces must align, (in addition to the data itself) for the program to be successful.
Winshuttle’s flexible platform for implementing master data governance is the quickest path to improve SAP finance master records. It empowers business teams to make instantaneous improvements to finance master record processes. Because it’s easy to use and deploy, the business can quickly resolve many critical data problems and progressively move the organization toward higher finance master data integrity.
To learn more about how Winshuttle customers are maintaining SAP master data and improving their finance processes, take a look at this Finance Master Records page.
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