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Hi,

Before understanding the account category reference, once should know what material type and valuation class are and how they are important in the valuation process of a material. If we are not aware these, then it will be difficult to understand what account category reference is and how it is related to valuation structure. Since our materials are grouped together on the basis of material typesand valuation classes for the purpose of valuation at different levels, we haveto establish some link between these two components of valuation structure.

Account category reference is the link between the valuation classes and the material types. The account category reference is a combination of valuation classes. Precisely one account category reference is assigned to a material type. In the standard SAP R/3 System, an account category reference is created for each material. The account category reference is, in turn, type assigned to precisely one valuation class. This means that each material type has its own valuation class. In the Standard SAP we have the following account category references for material type finished goods and valuation classes 7920.

FERT - 0009 - Ref. for finished products

7920 - Finished Goods - 0009

In the standard we have some predefined material type, valuation class and account category reference and a link between them has already established by the system itself. If we are using these standard setting no additional efforts are required. But to meet any specific requirement, if we have to create a new materialtype or a new valuation classes or a new Account Category Reference or all thethree, then we have to establish this link. In configuration we have to make thefollowing settings:

Create new material type

Create new account category reference

Define new valuation class

Link material types & valuation class via account category reference

Create an account determination for each valuation class in the step configure automatic posting

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Once this link has been established for the entire new requirement and automaticposting has been configured to meet this requirement, then nothing more is required. The system will take care of the rest of the activities automatically.Hi,

Better u understand this, the link for Automatic posting as

Material!Material Type!Acct Ref. category Valuation Class G/L Account

So, Acct Ref Cat. is a link between Material Type and Valuation class.

Now,

1. First Create Acct Ref Cateogry.

2. Create Valuation Class and Assign to Acct Ref category.

3. Now Go to OBYC to assign GL for those Transaction + Valuation Class.

2. For Tax Related Issue....Use T code OB40 assign GL to Tax's Conditions.

3. For OBYC, there are certain more assigemnt e.g. GL clearing Acct, Frieght Clearing Acct etc

Hope Clear U !