Differences Between Subledger and Subsidiary Accounting

Subledgers and subsidiary accounting both provide detailed accounting activity. Subsidiary accounts are a subdivision of your object account. Subledgers are linked to your business unit.object account or business unit.object.subsidiary account.

Subledgers give accounting detail without adding accounts to your chart of accounts. For this reason, subledgers are often used for transaction classifications that are not a permanent part of your chart of accounts, such as detailed travel expenses for account representatives.

Subsidiary accounts are permanent. If you want to track revenues and expenses by account representative using subsidiary accounting, you must create a subsidiary account for each account representative and attach it to each appropriate object account for revenues and expenses. This could mean adding several hundred accounts to your chart of accounts.

You can use a subsidiary account and a subledger in the same transaction, if necessary.

These are examples of ways in which subledgers differ from subsidiary accounts:

• Subledger transactions post to the same major account, rather than to different accounts.

• Subledgers do not create additional records in the Account Master table (F0901).

• Subledgers can create additional records in the Account Balances table (F0902), depending on the posting edit code that you assign to the account.