Leading And Non – Leading Ledger

The following SAP Training Tutorials guide what is leading Ledger and Non-
Leading Ledger in SAP New GL, its difference, and their importance in ERP
SAP R/3 Systems. General Ledgers are used to record the financial transaction
of an organization where the transactions are posted through Journal entries.
SAP Systems provides two types of Ledgers i.e.

 Leading Ledger
 Non Leading Ledger

Leading Ledger – In the Leading Ledger, all the postings are taken as
primarily and default. It is based on accounting principles that is used for the
consolidation of financial statements. Leader Ledger in SAP system is defined
as 0L and company codes are assigned to this ledger by default.

Non Leading Ledger – This Nonleading ledger is used for the purpose of
reporting like International Financial Reporting Standards (IFRS) and
taxation. It is parallel to the leading ledger and based on the local accounting
principles. You can activate non-leading ledger for the individual company
codes that you plan to use.

Example of Leading Ledger and Nonleading Ledger

 The Company is in India and US, where the parent company is
located in India.
 In India, organizations are required to submit final statements from
1st April to 31st March.
 In US, Companies should submit financial statements from 1st
January to 31st December.
 The main financial reporting is done for the parent company in
India is Leading Ledger and for reporting for the US is Non-Leading
Ledger.

Leading and Non-Leading Ledger enables you to maintain financial accounts

for more than one accounting principle as per company requirements. The
parent company from India is required to prepare financial statements as per
India GAAP and Company from US is required to Prepare reports as per
USGAAP. In some cases transactions may differ as per accounting standards,
so you post transactions in a particular ledger instead of both ledgers.