How to Carry Forward Balances in SAP Financial module

This process involves carrying forward account balances into the new fiscal year. The balance to be carried forward is shown in the account balance display. To carry forward balances, you can use separate programs for G/L accounts, and for customer and vendor accounts.

You therefore do not even have to carry out the balance carry forward manually if you have already posted to the new fiscal year.

The balance carry forward is executed as follows:

Carry Forward of Balance Sheet , Customer and Vendor Accounts

  • The balances on the balance sheet accounts are simply carried forward into the new fiscal year.
  • Additional account assignments are transferred.

There are no prerequisites for carrying forward balance sheet and customer and vendor accounts.

Carry Forward of Profit and Loss Accounts

  • Profit and loss accounts are carried forward to retained earnings accounts. And there after the balances of the profit and loss accounts are set to Zero.
  • Additional account assignments are not transferred.
  • Transaction currencies are no longer applicable and the profit and loss accounts are summarized in local currency.

Prerequisites to carry forward Profit and Loss Accounts

The following prerequisites must be fulfilled for profit and loss accounts:

  • Specify a profit and loss account type in the master record of every profit and loss account. This is a key, under which you define a retained earnings account for each chart of accounts.
  • You must define your retained earnings account.

You can make the setting in Customizing under Financial Accounting > General Ledger Accounting > Business Transactions > Closing > Carrying Forward > Define Retained Earnings Account

You can make the settings for the Special Purpose Ledger in Customizing for Financial Accounting under Special Purpose Ledger > Periodic Processing > Balance Carry Forward > Retained Earnings Accounts > Maintain Local/Global Retained Earnings Accounts.

you can define more than one retain earning account to carry forward the balances to different financial statements. To carry forward this you need to do special configuration for retained earning account.

Most companies use only one retained earnings account. If you use the profit and loss account type, you can use more than one retained earnings account. This might be useful for example, for international corporations that have to meet various requirements when producing the profit and loss statement. For more information, see Special Features of Profit and Loss Statements