The General Ledger system has been generalized to incorporate multi-level management reporting. This is done by defining the corporate structure in a series of codes prefixed to the specific cost account code. In effect each unit of the organization has its own chart of accounts for detail reporting. By establishing a consistent set of account numbers from which each unit selects only the accounts relevant to itself, it becomes very easy to assemble consolidated reports. When higher levels of corporate management want a consolidated report, it is a relatively simple matter to redo the basic report at the appropriate level ignoring all lower levels of breakdown.
The fully unique Account Number is composed of eight elements. The Account Code was designed for a multi-level reporting structure. Up to five corporate reporting levels can be used with the basic Control Account code. Provision is also made for two levels of sub-account code. Only the desired reporting levels need to be used. Operationally, the units of the Account Code are identified as follows:
| Level | Field | Length | Notes |
|---|---|---|---|
| 1 | Company | 2 | |
| 2 | Group | 2 | |
| 3 | Division | 2 | |
| 4 | Location, Department | 3 | |
| 5 | Branch, Territory | 3 | The lowest level of management responsibility. |
| 6 | Control Account | 4 | The conventional breakdown for accounting allocations. |
| 7 | Detail | 3 | A finer division of allocations than is normally reported on the balance sheet or income statement. |
| 8 | Sub-Detail | 3 |
The input of the account number conventionally provides a default consisting of the last account number entered. An initial default is provided as a Company parameter. The cursor is usually positioned at the first element after the designated paging element, however the two are defined independently.
An organization need only use as many sub-units as are useful to it. For example, a small company may only use Territory and Account. In this case, the Page Break in the company parameters is set to 5, the Territory, and the Position Cursor is set to 6, the Account. As a result, a page break occurs on Territory. The full Account Number appears on inputs, however most of it can be ignored because the cursor is positioned at Account which is usually the only element to be changed.
Each element of the Account Number is associated with a Code Table identified by the element numbers, e.g. Department is associated with Code Table 4. By completing the tables, meaningful names will appear with each report total line. This adds considerably to the clarity of reports - particularly consolidated reports.
In the General Ledger (Application code G) the Table Ids 1 through 8 are reserved for the elements of the Account Number. The Table Header, Table Id = * and Code = element number, must be in place for subheadings and totals to appear on reports and the element to be edited when an account is added. If the Cross Reference is "NO" the subheadings and totals will not print but the element will still be edited. The subheading and totals for one element value is suppressed by setting the Cross Reference for that value to "NO".
When the code table for an element is in place, the value for that element must be one of the defined values when the Account Number is added. If a value of an element is retired after an Account Number is created it does not affect the validity of the Account Number.
Accounts are classified as assets, liabilities, incomes, or expenses. The account type does not affect the debit/credit relationship for amounts. Incomes and liabilities require a clearing account which is used only in the year-end processing.
A monthly budget is maintained independent of the Account Master. The budget is updated through a separate update. The maximum budget per month for an account is $10 million.