Dimensional accounting means tagging each transaction with appropriate dimensions like Branch, Business Unit, etc.
This allows you to maintain each segment separately, thereby limiting the overall maintenance on General Ledger accounts and your Chart of Accounts remains pure. In the system you can create configurable accounting dimensions and use them in transactions and reports.

1. Pre-requisite

No Pre-requisite required

2. How to Create an Accounting Dimensions

To access the Accounting Dimension list, go to:

Finance > Basics > Accounting Dimensions

1. Go to the Accounting Dimension list and click on New.
2. Select the Reference Document which you want to use as a custom dimension. For example, if you select Asset as Reference Document, the dimension will be based on Asset.
3. Enter the name of the dimension (This name will appear in the transactions for which dimensions are created).
4. Inside the Dimension Defaults table you can mention company specific default dimensions.
5. This dimension will be automatically fetched in the transaction against that specific company.
6. Check the "Mandatory" checkbox if you want the dimension to be mandatory in the transactions.

2. Features

As you create the dimension, custom fields will be created using a background job for that specific dimension. You can see them in Accounting Dimensions section inside the transactions which have an impact on Accounting entries (GL Entry).

2.1 Using dimensions in transactions

To tag a transaction with a dimension you can select the specific dimension in Accounting Dimensions section as shown below.

2.2 Filtering Reports based on dimension

To tag a transaction with a dimension you can select the specific dimension in Accounting Dimensions section as shown below.

2.3 Making accounting dimensions mandatory for "Profit and Loss" and "Balance Sheet" Accounts

Profit and Loss is the group of Income and Expense accounts that represent your accounting transactions over a period.
Balance Sheet accounts are Application of Funds (Assets) and Sources of Funds (Liabilities) that signify the net-worth of your company at any given time.
By selecting the check boxes 'Mandatory for Profit and Loss Account' or 'Mandatory for Balance Sheet' you can configure your dimensions to be mandatory for 'Profit and Loss' and 'Balance Sheet Accounts'.

2.4 Disabling accounting dimensions when no longer required

You can also disable the dimensions if you don't require them anymore. The old transactions having accounting dimensions will remain intact.