Create an Additional Accounting Schema

The purpose of this page is to offer (1) an explanation as to when you need an additional Accounting Schema and (2) a step by step process to create an additional Accounting Schema.

Before You Start

Creating an additional Accounting Schema is an advanced topic. You should perform these steps in a test environment before you perform touching your production system. I also recommend you review the multi-currency section before executing the below steps.

Frequently Asked Questions:

Why create another Accounting Schema Why??

When you have multiple entities (organizations) who need to manage their books in their respective native currencies. Said another way, you have multiple organizations with different functional currencies.
When you want to manage cash and accrual accounting simultaneously.

Can you transact in multiple currencies with a single Accounting Schema? Yes. You do not need multiple Accounting Schemas to perform basic multi-currency transactions. Here is an example scenario that only needs one Accounting Schema:

You have company with three organizations.
One is located in the US. One is located in Europe. One is located in Asia.
The US is the global headquarters.
The European and Asian entities are located in countries that are friendly to the US dollar. This means that these countries allow the European and Asian entities to maintain their general ledger in USD. Said another way, USD is their functional currency.
There is only one Accounting Schema. It has a currency of USD.
Every transactional document created by any of the organizations will get posted to the USD Accounting Schema. If you have an invoice raised in EUR for example, it will always get posted in USD to the USD Accounting Schema.

When would the above scenario require investigating the addition of a Accounting Schema? When the above company creates a new organization that exists in a country that is not as USD friendly. Japan is an example. If the new JP organization performs an appreciable amount of their transaction in the JPY, then the local authorities will probably ask them to manage their books in the local currency. This means that organization's local currency will become their functional currency. Just because you go into Japan, does not mean that you need to create a new Accounting Schema. The Japanese organization's complexity will drive this decision.

The new organization could just be a promotion organization. Promotional organizations have limited staff and a small office. They typically do not stock product, and they might operate on a cost-plus profit structure. If they are a promotional organization, you are probably better served to outsource the local currency accounting to a local firm and simply import the results via a GL Journal. This outsourced structure is less complex and easier to maintain than managing multiple Accounting Schemas.

If the Japanese organization is a full distribution center for example, then you will probably need to create an additional Account Schema.

What is a cost plus profit structure? A cost plus profit structure says that a given organization will generate revenue as a function of their expenses. For example, cost plus 10% says that an organization incurring a monthly cost of $10,000 will generate a revenue of $11,000.

Steps to Create an Additional Accounting Schema

This section assumes you are using the same Account Element (COA) across all Accounting Schemas.

Create your new schema record in the Accounting Schema window.
Click on Account Schema Dimensions subtab
Create your Dimension records (similar to current schema). Point the Account record/field to your current Account Element record. (COA). This is the link between your Accounting Schema and your Chart of Accounts (Account Element).
Go back to your Accounting Schema tab and run the process to create defaults from current schema. Note: this process is expecting an existing or old schema and not your newly created schema. Said another way, this process is looking for a schema that already has values to copy to your newly created schema.
Click on Defaults subtab. Run process to push down process for your new schema. The creates records in the Bank, Warehouse, etc... accounting sub-tabs. NOTE:
1. MAKE SURE YOU CHOOSE THE NEW SCHEMA!! You do not want to modify the old/current schema.
2. This process pushes default to the Product Category and Business Partner Group accounting records.
3. It does not push the defaults all the way to the Business Partners and Products.
4. You must go to each Business Partner Group and Product Category record, navigate to the Accounting sub-tab, and execute the Copy Accounts process. If you miss this step, your document will error when trying to post in an "Invalid Account" or "Not Balanced" error.
Note: some records require custom GL Account. Banks and Charges are two examples. When you execute the Copy Accounts process, it will give every Bank and every Charge the same account. If you have already customized your Banks and Charges with individual GL Accounts, in your previous Accounting Schema record, you can write SQL to update the newly created _Acct records to point to the same values/accounts as your current schema.
Restart the application server.

Here is a PostgreSQL statement to show you every table that has a record that references C_AcctSchema_ID.

select t.tablename
from ad_column c 
join ad_table t on c.ad_table_id = t.ad_table_id
where c.columnname = 'C_AcctSchema_ID'
and t.isview = 'N'
order by t.tablename