System account
System accounts are detail accounts that are used for system generated entries. You must define system accounts for each chart of accounts. This table describes the various system accounts you define.
| System accounts | Description |
|---|---|
| Undistributed retained earnings account |
The undistributed retained earnings account stores the net income or loss by period. It is updated each time you run Journal Posting (GL190) to post general ledger journal entries. When you run year-end closing, the amount in this account is cleared and posted to the retained earnings account. This type of account is required for fiscal year-end closing and journal posting. Note: The undistributed retained earnings account
is included on the Balance Sheet to reflect the net income or loss
for the period. This keeps the Balance Sheet in balance.
|
| Retained earnings account | The retained earnings account is used to hold the company's net income or net loss from its inception. This type of account is required for fiscal year end closing. |
| Error suspense accounts | Error suspense accounts keep a company in balance by balancing out-of-balance journal entries. Error suspense accounts are also used when an invalid account or accounting unit is used on a transaction coming from a Lawson or non-Lawson subsystem. This type of account is required for journal posting. |
| Translation gain/loss accounts | Translation gain and translation loss accounts are used to post gains or losses that result from currency translation. If you don't use currency translation, you do not need to define these accounts. |
| Balancing accounts | Balancing accounts can be used to store report currency transactions that are not in balance and auto-balancing adjustment entries. When you define your company you indicate whether to auto-balance when a journal is released. |
| Commitment accrual account | The commitment accrual account holds the total accrual amount for commitments and encumbrances processed by Period Year End GL Commitment Accrual (GL197). These are auto-reversing entries for any commitments that have not become actuals. |
Uses of system accounts
This table indicates the system accounts used by specific General Ledger procedures.
| Procedure | System account used |
|---|---|
| Fiscal Year End Closing |
Retained Earnings Undistributed Retained Earnings |
| Journal Posting |
Undistributed Retained Earnings Error Suspense Report Currency Adjustment |
| Currency Translation |
Translation Gain Translation Loss |
| Journal Entry Releasing | Balancing Accounts |
| Period, Year End GL Commitment Processing | Commitment Accrual Account |