Enable Encumbrance Accounting
You can enable encumbrance accounting for ledgers, business units assigned to a ledger, and transaction types.
Encumbrance journals are created based on the subledger accounting method assigned to the ledger.
You can assign one of the following predefined subledger accounting methods:
-
Standard accrual
-
Accrual with encumbrance accounting
The differences between the subledger accounting methods are shown in the following table:
|
Enable Encumbrance Accounting |
Subledger Accounting Method |
Requisition/PO Journal Entries Automatically Created |
GL/SLA Manual Encumbrance Journal Entries Allowed |
|---|---|---|---|
|
No |
Standard accrual |
No |
No |
|
Yes |
Accrual with encumbrance accounting |
Yes |
Yes |
|
Yes |
Standard accrual |
No |
Yes |