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Author's profile photo Henrike Groetecke

Accounting Principles, Ledgers, and Parallel Accounting

Here’s some general information about accounting principles, ledgers, and parallel accounting:

Accounting Principles

Accounting principles are rules for legal accounting and financial statements and govern how companies record and report their financial data. Accounting standards are collections of accounting principles, for example, the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB). In addition, there are local accounting standards, for example, the United States Generally Accepted Accounting Principles (US GAAP) or German Commercial Code (Handelsgesetzbuch, HGB).


SAP delivers the following ledgers with the following underlying accounting principles:
  • 0L: This mandatory leading ledger is a local ledger based on the generally accepted accounting principles (GAAP) of your country or region.
  • 2L: This optional corporate or group ledger is based on IFRS.
  • 3L: This optional corporate or group ledger is based on US GAAP.

You can use the following ledger or ledger combinations (parallel ledgers):

Ledger Description
0L leading ledger (local GAAP)
0L + 2L local GAAP + IFRS
0L + 3L local GAAP + US GAAP

To set up financial reporting in your system based on the accounting principles mentioned above, in the scope setting phase of your implementation, choose one of the following scope items:

Parallel Accounting

Parallel accounting enables you to perform valuations and closing operations for a company code based on the accounting principles of the group as well as additional accounting principles, such as local accounting principles.

Here’s a typical use case:

The German subsidiary of a US-American group has to create financial statements according to German commercial law (Handelsgesetzbuch, HGB) as well as according to the accounting principles of the group (US GAAP).

To read more, please go to the SAP Help Portal:

Accounting Principles:


Parallel Accounting:

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      Author's profile photo Venkateswarlu Manduva
      Venkateswarlu Manduva

      Hi Henrike Groetecke

      Thanks for your post and this is very good information. I have one requirement for a Shell co code where we need to have posting periods like 4+4+5 weeks and so on and we are following Jan to Dec as fiscal year variant. We have 0L for IFRS and 1L for USGAP with same fiscal and posting period variants and Shell co also follow the same fiscal varinat but with different posting period varinat. The purpose of Shell co code is to post some adjustment entries only and not all business transactions. How to achieve this and i can thought of creating another ledger and use extension ledger concept but how to restrict normal postings to this standard ledger.


      Author's profile photo Marcin Nowacki
      Marcin Nowacki

      Thanks for sharing!

      Author's profile photo Owen Liu
      Owen Liu

      Thanks for sharing.

      Author's profile photo Ana Moreira
      Ana Moreira

      Thanks for creating this

      Author's profile photo Rachel Suo
      Rachel Suo

      Thanks so much for this useful sharing~

      Author's profile photo Vijayendra Tiwari
      Vijayendra Tiwari

      Thanks for sharing!

      Author's profile photo Anjan Sinha
      Anjan Sinha

      Hello Henrike Groetecke,


      In our 1909 system I cannot find the "

      • 2L: This optional corporate or group ledger is based on IFRS.

      How can I make it available.

      Please let me know ASP.

      Thank you in advance.




      Anjan Sinha