The traditional accounting method is to create and account for each one of the customers, suppliers, employees and so on. This is accurate since you need to have a statement and balance of how much you have paid or collected from each one of them.

If you are new to SAP, you are going to discover that is not how the system works, because it is coded in order for you to link this accounts master data in their catalog and then use them in your financial structure.

For each one of your receivable or payable accounts, you can create an entity that is going to have a financial account specified in the master data, so each time that you post a document using this entity, you are going to affect the financial account.

The same way is works for debts or invoices, it works for fixed assets and depreciation.

If you need to affect a different financial account that the one that is configured in the master data for customers, suppliers or fixed assets, the system has the functionality for SGL or special ledger indicator, where you can pre configure a “letter” that is linked to the account that you want to post to.

As an example, you may have an employee that has its payroll account in their master data, but you want to post in one transaction to the travel expenses account, so you select in the SGL indicator box the letter that ins linked to the correct account.

For more information, you can check our FI Configuration Course in Udemy.