Account code segment –
A section of an account code that represents a specific type of entity for which you are accounting.In many accounting systems, especially those used in ERP (Enterprise Resource Planning) software like Oracle or SAP, account codes are broken down into multiple segments, with each segment carrying distinct information. Segment (n) typically indicates the nth portion in a predefined chart of accounts structure.
Example Breakdown of an Account Code:
Suppose you have an account code: 01-200-4500-3301
| Segment | Meaning | Type of Entity Represented |
|---|---|---|
| 01 | Company Code | Legal entity |
| 200 | Department | Business unit or cost center |
| 4500 | Account | Expense or revenue type |
| 3301 | Project Code | Specific project or internal job |
So in this case, segment (3) (i.e. 4500) would be the “account” segment, representing the type of financial transaction (e.g., travel expense, salary, revenue).
Key Points:
- Each segment has a defined purpose and structure.
- They allow for granular tracking and reporting.
- Segment (n) is contextual—its definition depends on the chart of accounts setup in your system.