From which G/L account types are values shown in the profit and loss (P&L) statement?

Comprehensive Detailed Explanation with all SAP S/4HANA Cloud References

In SAP S/4HANA, the Profit and Loss (P&L) statement displays values from specific G/L account types that are classified as income or expense accounts. These accounts represent the financial performance of an organization over a specific period. Let’s analyze each option to determine the correct answers.

Explanation of Each Option:

A. Non-operating Expense or Income

Correct : Non-operating expenses or income (e.g., gains or losses from asset sales, interest income, or extraordinary items) are included in the P&L statement. These accounts represent income or expenses that are not part of the core operating activities of the business but still impact the overall financial performance.

Reference : According to SAP documentation, non-operating income and expenses are categorized under P&L accounts and contribute to the net profit or loss.

C. Primary Costs or Revenue

Correct : Primary costs or revenue accounts represent the core operating activities of the business, such as sales revenue, cost of goods sold, and direct operational expenses. These accounts are a fundamental part of the P&L statement and directly reflect the organization's primary financial performance.

Reference : SAP classifies primary costs and revenues as P&L accounts, as they are essential for calculating gross profit and operating profit.

D. Secondary Costs

Correct : Secondary costs (e.g., internal allocations, overheads, or indirect costs) are also included in the P&L statement. These accounts are typically used in management accounting (CO) and are transferred to the P&L statement through periodic allocations or settlements.

Reference : Secondary costs are part of the cost-of-sales accounting process and are reflected in the P&L statement to provide a complete view of expenses.

B. Balance Sheet Account

Incorrect : Balance sheet accounts (e.g., assets, liabilities, equity) are not included in the P&L statement. Instead, they are reported in the balance sheet, which provides a snapshot of the organization's financial position at a specific point in time.

Reference : Balance sheet accounts do not represent income or expenses and therefore do not appear in the P&L statement.

E. Cash Account

Incorrect : Cash accounts are part of the balance sheet (under assets) and are not directly included in the P&L statement. While cash flows may indirectly impact the P&L (e.g., through interest income or expenses), the cash account itself is not a P&L account type.

Reference : Cash accounts are classified as balance sheet accounts and are excluded from the P&L statement.

Key References to SAP S/4HANA Documentation:

SAP S/4HANA Finance for Financial Statements : Explains how G/L account types are classified and displayed in the P&L statement.

SAP Help Portal - Account Types : Provides detailed guidance on the classification of G/L accounts into P&L and balance sheet categories.

Profit and Loss Statement Configuration : Highlights the role of primary costs, secondary costs, and non-operating income/expenses in the P&L statement.

Integration of FI-AA and CO-PA : Describes how secondary costs are transferred to the P&L statement for reporting purposes.