What is the using of retained earnings account

HI
In the above , please reply the answer as early as possible
with regards
srinivas

this question is poste in wronf foroum it sould be in FI not in MM
from www.investopedia.com
retained earnings account
The percentage of net earnings not paid out as dividends, but retained by the company to be reinvested in its core business or to pay debt. It is recorded under shareholders' equity on the balance sheet.
The formula calculates retained earnings by adding net income to (or subtracting any net losses from) beginning retained earnings and subtracting any dividends paid to shareholders:
Also known as the "retention ratio" or "retained surplus".
In most cases, companies retain their earnings in order to invest them into areas where the company can create growth opportunities, such as buying new machinery or spending the money on more research and development.
Should a net loss be greater than beginning retained earnings, retained earnings can become negative, creating a deficit.
The retained earnings general ledger account is adjusted every time a journal entry is made to an income or expense account.
hope this helps

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What is the use of split valuation Accounting view

Hi
What is the use of split valuation Accounting view.is it compulsary to give for every materisl?
regards
Ashok

Hii Ashok,
The SAP R/3 System allows you to valuate stocks of a material either together or separately, that is, according to different valuation criteria. Split valuation is necessary if, for example:
1. Stock from in-house production has a different valuation price than externally procured stock.
2. Stock obtained from one manufacturer is valuated at a different price than stock obtained from another manufacturer.
3. Different batch stocks of a material have different valuation prices.
4. Value damaged and repair part differently from a new part.
To used split valuation, you have to activate it using 'OMW0'.
To change split material valuation once it has been set, you must
1. first post out all stocks (for example, to a cost center or with movement type 562)
2. then change the control parameters
3. if necessary, change the automatic account determination
4. finally post the stocks back in again
In split valuation, you can distinguish between partial stocks of a material according to certain criteria and valuate them separately.
The material stock is divided according to valuation category and valuation type.
The valuation category determines how the partial stocks are divided, that is, according to which criteria.
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which valuation types exist in your company (global types)
which valuation types belong to which valuation category
which valuation categories exist in a valuation area (local categories)
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B procurement type
with the valuation types:
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H Origin
X automatic valuation (only for batch)
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global valuation types via menu "Goto --> Global Types"
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a) Select "Goto --> Local definitions".
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What is Retained Earnings account and P&L Type

Hi,
What is Retained Earnings Account, how the transactions are updated to this account and what is P&L statement Type.In which case we create multiple REA and P&L Statement type. Please Explain me.
Thanks in Advance
Abhi

Retained earning account is used to profit or loss from P&L satement accounts.
Each P&L account is assigned to a retained earnings account via a key and this how transactions are updated in RE account.
We use different retained earnings accounts in an international corporate group to meet various requirements for preparing financial statements.Chk the link
http://help.sap.com/erp2005_ehp_01/helpdata/en/c7/a88d2243dd11d182b30000e829fbfe/frameset.htm
Assign points if useful

Retained earnings account

Hi,
Can we maintain retained earnings accounts as open item management account?
our client has changed the status to Open item management account recently, due to this reason he is unable to do year ending carryforward through F.16. They are getting error analsys that change the status to without open item management.
treat this issue on priority ...
Thanks & Regards,
Prasad

Hello Prasad,
Retained earnings account is balance sheet account. At the closing of fiscal year, we need to carry forward balances of P&L accounts to retained earnings account. We have to create Retained earnings account at IMG level. Profit or Loss is carried forward to this account at the end of the year. Normally, companies use one retained earnings account. For this reason, X can be used as the key. In the chart of accounts you enter X in the P+L statement account type field.
Have you done any time year end closing functionally?
What we will be doing is drawing the "P & L account" transferring all balances in Rev & Exp to "P & L acc".
This P & L account in SAP is widely called as retained earnings account. At the end of the period, all your Rev & Exp are posted to this account which is a Balance sheet Item. This you are identifying as Retained earnings account type X and assigning a GL account. When you create this as a GL account system understands that this is Retained earnings account.
Profits of the organization are always Liability. Losses are Assets. As profits form part of "share holders funds".
You assign this retained earnings account in your financial statement version in such a way if the balance is credit in the liability side and if the balance id Dr then asset side
Thanks
Para

2 retained earnings account to be maintained

Hi
Our client requirement is we have to maintain 2 retained earning account one is for Previous year retained earnings account and another is for current year.
How to do it
and how the value will flow from the current retained earnings account to previous year retained account

Hello,
Retained earnings account is balance sheet account. At the closing of fiscal year, we need to carry forward balances of P&L accounts to retained earnings account. We have to create Retained earnings account at IMG level. Profit or Loss is carried forward to this account at the end of the year. Normally, companies use one retained earnings account. For this reason, X can be used as the key. In the chart of accounts you enter X in the P+L statement account type field. If you want you can use more than one REA in ur co code.
Have you done any time year end closing functionally?
What we will be doing is drawing the "P & L account" transferring all balances in Rev & Exp to "P & L acc".
This P & L account in SAP is widely called as retained earnings account. At the end of the period, all your Rev & Exp are posted to this account which is a Balance sheet Item. This you are identifying as Retained earnings account type X and assigning a GL account. When you create this as a GL account system understands that this is Retained earnings account.
Profits of the organization are always Liability. Losses are Assets. As profits form part of "share holders funds".
You assign this retained earnings account in your financial statement version in such a way if the balance is credit in the liability side and if the balance is debit then asset side
Thanks
Para

Retained earnings account fi

Hello friends ,
can anybody help me .iam trying to create retained earning account in master data in img but the errors continously coming is (data can only be displayed -data is still being processed) its coming only in display mode not in change mode.How can i make it into change mode.pls help me

Hi,
Have you tried to define retained earning account by using the following T Code.
OB53 - Define Retained Earnings Account
Most companies use one retained earnings account. For this reason, X can be used as the key.
In the chart of accounts you enter X in the P+L statement account type field, and for account determination you enter the retained earnings account under the key X.
FSP0 - Edit G/L account - Chart of accounts
Please assign points if helpful.
Regards,
Nitin Aggarwal

Why do we need retained earnings account in income statement?

hi,
as far as i am concerned we need a retained earnings account only in a balance sheet statement. however i dont understand why do we need a retained earnings account in the income statement. can someone explain?

Hi
The account nothing but contains the accumulated profits which are divisible to the shareholders carry forward from the P&L account.
we define Retained earnings a/c in OB53.
Most companies use one retained earnings account. For this reason, X can be used as the key.
In the chart of accounts you enter X in the P+L statement account type field, and for account determination you enter the retained earnings account under the key X
assign points if useful

Why do we need more than one retained earnings accounts & what is the use?

Hi FI Experts,
Why do we need more than one retained earnings accounts, what is the precise use of two?
I know the retained earnings account is used to carry forward the balances during the year end to the balance sheet and there by making the p&L A/cs balances as zero.
I guess the second one is used for different valueations for example as depreciation accounts for different valuations will have different retained earnings accounts.
Kindly correct me if I am wrong and eloborate on the use having more than one retained earnings accounts.
with regards
Ramesh Y

Hi,
Well, separate retained earnings accounts are used for parallel financial reporting, it means when you need to report in accordance with, for example, local GAAP and IFRS or US GAAP at the same time. Several retained earnings accounts are necessary when the company chooses account based approach for parallel reporting. (GL accounts are broken down into several groups, for example you use different accounts for IFRS valuation, for local GAAP and they are also shared accounts common for both principles.)
m.

When will we use 2 types of Retained Earnings account and purpose???

Dear Friends,
In which situation we will use 2 Types of Retained Earnings Accounts and may i know the purpose of it??
regards,
shashi kanth.

Dear Friends thank u for u r valuble responces.
Points have been assigned to both of u.
If u could ans for following queries i will be clear on this topic.
See Client Requirment:
PROFIT BEFORE TAX (A - B)                 1000
Less : Provision For Taxation
             Current Years Taxation                 200
             Deferred Tax Assets                (50)
             Fringe Benefit Tax                 20
PROFIT AFTER TAX                 830
Soo Upto Profit Before tax its fine no problem.
Profit after Tax ..How to Show this amount in Balance Sheet ....
clarify me..
bye
shashi kanth

What is the use of provision account in vkoa t.code

Hi,
i have a doubt regarding in vkoa t.code there are G/L Accounts column and Provisions column what is the use of provision column and what is the difference between these two.
i am waiting for u r replies.
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Kishore.

Hi,
'The provision account is only required if there are conditions that are relevant for accrual, for example, rebate conditions. If this is the case, account determination takes place in the billing document with the field'
In other words it will be used to store the valuue of a( for eg.,Rebate) condition type in a different GL a/c for the periodic calculation of the total value of the same cond.type...
chk this thread for more clarity on Accrual
Re: Rebate Accrual Rate
Reg
JJ
Edited by: Jagsap on Jul 10, 2009 1:03 PM

What is the use of SWIFT CODE IN BANK ACCOUNTS

What is the use of SWIFT CODE IN BANK ACCOUNTS

HI kishore,
The SWIFT code is used for identifying banks in international payment transactions.
see these links for your refernece
http://sapexperts.blogspot.com/2007/01/bank-accounts.html
http://www.answers.com/topic/international-bank-account-number
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karthik

What is the use of OASV transaction in Asset accounting

Dear Experts,
Could you please advise me clearly what is the use of OASV transaction in Asset accounting and which GL account we need to use for debit and credit while using this t code. Can you please provide me along with examples for better understand and that would be great for me.
Thanks in Advance,
Murali

Transfer Balances
In this step you can post balances to G/L accounts which have already been defined as reconciliation accounts. You can only post these corrections in company codes which have implementation status.
The transfer of legacy asset data using the legacy asset transaction does not affect the balances of the corresponding reconciliation accounts in Financial Accounting. Therefore no automatic balance formation or reconciliation takes place and you will need to manually reconcile the balances. You can ascertain the Asset Accounting values using of the asset list. When you start this report, specify January 1st of the current fiscal year as the report date. The system will then provide data as of December 31st of the previous fiscal year (in other words, no depreciation from the current fiscal year is included).
Activities
Copy the balances from any suspense accounts to the Asset Accounting reconciliation accounts.

Retained Earnings account type

Hi guys,
While creating a retained earnings account, we have a field called P&L statement account type which is given as X or Y. What is the meaning of this?
Do we assign this X or Y somewhere to the Pand L account.
Thanks
srik.

HI,
With the P&L statement account type, you determine the retained earnings account for each P&L account. The retained earnings account is used during year-end closing to calculate the company's result.
If you are creating a P&L account, you must make an entry here.
Dependencies
If you determine during a fiscal year that you mistakenly designated a G/L account as a P&L account instead of a balance sheet account, you will need to change its master record. You will then have to rerun program SAPF011 to correct the balances of the G/L accounts carried forward
Means will transfer the P& L account balance to balance sheet.
Reg
Madhu M

Retained Earnings Account balance not carry forwarded to next year

Hi,
We have problem in Retained Earnings Account Balance C/F to next year
example:
G/L Account closing balance in 2008 - 1000.00 (as per FS10N) after c/f balances to 2009
G/L Account Opening balance in 2009 - 850 (as per FS10N) (there is a difference 150.00)
If we double click on Cumulative balace of 850 it will give us - 1000.00 and if we see in report : FBL3N it will show correct balance. Only FS10N is not showing correct balance.
Can you please let us know what will be the reason ?
Thanks
Ravi

Hi Ravi,
We are using 4.6C version and last few years there was no problem and we have other company codes which are showing correct balance. But only one company code this difference is coming.
If we double click the FS10N report opening balace it will give us the correct balance. But in display there is showing less amount.
Thanks

FS10N Opening balance difference (Retained Earnings Account)

Hi,
We are getting opeing balance difference in FS10N balances from 2007 to 2008 (retained earnings accounts)
1. We have carry forward the 2007 balances to 2008 through T.Code : F.16
2. We are getting difference in 4 company codes.
3. But there is no difference in T.Code: FBL3N
Company      2008                            2007
1000     20,457,623.98     20,635,622.78
Difference     =     177,998.80
1001     49,091,242.21     48,913,243.41
Difference     =     177,998.80
1002     394,867,485.91-     396,028,401.55-
Difference     =1160915.64
1003     2,556,851.66-     1,395,936.02-
Difference     =1160915.64
Can you please let us know why this difference is comming ?
Thanks
Madhusudan

If you are using ECC use T. code FAGLGVTR - Balance Carryforward (New)
F.07 - Balance Carryforward for Vendor/customers
then only it shows the correct picture.
when FBL5N is line item report it is no way relavent to balance carry.
this may solve your problem
assign points if it help

What is the using of retained earnings account

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