ASU 2024-03 Chart of Accounts Mapping: Which Tools Actually Work

Every public business entity (PBE) needs to map its existing chart of accounts to the five natural expense categories in ASU 2024-03 (DISE) before fiscal year 2027. The accounting policy questions are largely settled. The systems question is not.

This guide is for controllers, accounting operations leads, and finance technology owners who need to decide right now whether their ERP can handle the mapping natively, what a separate reporting layer looks like in practice, and which evaluation criteria separate a workable solution from one that will create audit problems.

Key takeaway: ASU 2024-03 chart of accounts mapping is not just an accounting policy exercise. It is a data architecture decision. The tool you choose determines whether you can produce auditable, retroactively recastable DISE tables at scale, or whether you are manually reconciling spreadsheets the night before the 10-K is due.

What the Mapping Actually Requires (the Systems Lens)

The core challenge is that most general ledgers are built around functional expense categories, not natural ones. COGS, SG&A, and R&D are functional. Purchases of inventory, employee compensation, depreciation, intangible asset amortization, and DD&A/depletion are natural. These two dimensions are orthogonal, and most ERP chart of accounts structures do not capture both simultaneously.

FASB's ASU 2024-03, codified in ASC Subtopic 220-40, requires PBEs to disaggregate, in tabular footnote disclosures, the amounts of five natural expense categories included within each "relevant expense caption" on the income statement. A relevant expense caption is any income statement line item that contains at least one of the five categories enumerated in ASC 220-40-50-6:

1. Purchases of inventory
2. Employee compensation
3. Depreciation
4. Intangible asset amortization
5. DD&A/depletion (oil and gas and other depletion)

The standard is effective for annual periods beginning after December 15, 2026, meaning calendar-year PBEs must adopt for fiscal year 2027, with first required 10-K disclosures in early 2028. Interim period requirements follow one year later, for fiscal years beginning after December 15, 2027.

For the full disclosure requirements and scope exclusions, see Finrep's DISE disclosure requirements guide and implementation guide. This article focuses entirely on the tooling decision.

The Three Architectural Approaches to COA Mapping

Before evaluating specific platforms, finance teams need to choose an architecture. There are three realistic options:

Option 1: Restructure the Chart of Accounts in the ERP

This means adding new GL accounts or sub-accounts that natively tag transactions by natural expense category. A company might split its existing "Compensation and Benefits" account (which blends employee comp, contractor costs, and benefits) into separate accounts for employee compensation, contractor services, and benefits, so the natural category is captured at the point of entry.

Pros: Clean data at source. No mapping layer to maintain. Easier audit trail.

Cons: Expensive and disruptive. Requires change management across every business unit that codes transactions. Historical data does not reclassify automatically, creating a retroactive recast problem (see below). Most large enterprises have hundreds or thousands of GL accounts and cannot restructure them on an 18-month timeline.

Option 2: Build a Mapping Layer on Top of the Existing COA

This is the approach most enterprises will take. The existing GL structure stays intact. A mapping table is created that assigns each GL account (or account-department-cost-center combination) to one or more of the five natural expense categories. The mapping layer sits between the GL and the disclosure output.

Pros: Non-disruptive to existing processes. Retroactive application to historical periods is feasible if the mapping is well-documented. Auditable if the mapping table is version-controlled.

Cons: Requires ongoing governance. When new GL accounts are added, someone must update the mapping table. Mixed-content accounts (a single account that contains both employee comp and contractor costs, for example) require either a split or an estimation methodology, both of which need auditor sign-off.

Option 3: Transaction-Level Tagging

Some ERP platforms and financial close tools support tagging individual journal entries or transaction lines with a natural expense category attribute, separate from the GL account code. This is the most granular approach and produces the cleanest data, but it requires either ERP customization or a subledger tool that supports the attribute.

Pros: Handles mixed-content accounts precisely. Supports segment-level disaggregation without additional mapping complexity.

Cons: Requires the most ERP configuration work upfront. User adoption is a significant risk: if coders do not apply the tag consistently, the data is unreliable.

ERP Native Capabilities: What SAP, Oracle, and Workday Actually Support

The honest answer is that no major ERP natively produces an ASU 2024-03 DISE table out of the box as of mid-2026. What they do support is the underlying data architecture that makes mapping feasible.

SAP S/4HANA

SAP's account-based CO-PA (Controlling-Profitability Analysis) model captures costs by both cost element (natural) and cost center/profit center (functional) simultaneously. This is the closest thing to native DISE support in a major ERP. Companies already running account-based CO-PA can extract natural expense category totals by functional area with a custom report or a BW/SAC query.

The catch: many SAP customers run costing-based CO-PA, not account-based, and the two models do not produce the same data. Migrating between them is a significant project. SAP also does not natively map its cost elements to the five ASC 220-40-50-6 categories; that mapping table must be built and maintained in the system.

For companies with SAP Group Reporting, the consolidation layer can carry a custom characteristic for natural expense category, which is a cleaner place to build the mapping than in the operational CO-PA.

Oracle Cloud ERP / Oracle Fusion

Oracle's chart of accounts uses a segment-based structure. Finance teams can add a custom segment to the accounting flexfield to capture natural expense category at the journal entry level. This is Option 3 (transaction-level tagging) implemented natively in Oracle.

The practical challenge is that adding a segment to an existing flexfield in a live Oracle instance is a significant configuration change that affects every integration, every import template, and every existing report. Most Oracle customers will find it easier to build the mapping at the account-segment combination level in OTBI or Oracle Financial Reporting Studio, rather than restructuring the flexfield.

Oracle's Financial Consolidation and Close (FCCS) module supports custom metadata dimensions, which is a reasonable place to build and maintain the DISE mapping table for consolidation-level reporting.

Workday Financial Management

Workday uses a worktag-based architecture rather than a traditional chart of accounts. Natural expense categories can be implemented as a custom worktag applied at the transaction level. This is architecturally well-suited to DISE requirements, but it requires deliberate configuration and a governance process to ensure the worktag is applied consistently.

Workday's reporting layer (Prism Analytics or custom reports) can then aggregate by the natural expense worktag across functional cost centers. The limitation is that Workday's financial reporting output is not formatted for footnote disclosure; a separate tool is still needed to produce the DISE table in a format suitable for the 10-K.

NetSuite

NetSuite's classification system (departments, classes, locations) can be used to tag transactions by natural expense category, as noted in practitioner guidance on DISE implementation in NetSuite. The Financial Report Builder and SuiteAnalytics saved searches can produce the underlying data. Like Workday, NetSuite does not produce a formatted DISE footnote table natively; the output needs to be consumed by a disclosure management tool.

The Disclosure Management Layer: Where the DISE Table Gets Built

Regardless of ERP, most enterprises will need a financial close or disclosure management platform to produce the actual DISE table. This is where the COA mapping table lives in practice, and where the output is formatted for the 10-K footnote.

As Workiva notes, "Customers who use our platform for financial statement automation typically start by mapping a chart of accounts to a rollup of financial [statement line items]." That framing is accurate: the mapping table is the starting point, and the disclosure management platform is where it is maintained and applied.

Key Evaluation Criteria for DISE Tooling

When evaluating whether your existing financial close platform or a new tool can support ASU 2024-03 COA mapping, assess these five capabilities:

1. Mapping table management. Can the tool store and version-control a GL account-to-natural-category mapping table? Can it flag unmapped accounts automatically? Version control matters because the standard requires recasting prior periods, and auditors will want to see that the mapping was applied consistently across all periods presented.

2. Retroactive recast support. ASC 220-40 requires recasting prior comparative periods unless impracticable. Your tool must be able to apply the current-period mapping to historical GL data. This means the mapping must be backward-compatible with prior-period account structures, including accounts that have been renamed, merged, or retired.

3. Mixed-account handling. When a single GL account contains multiple natural expense types (the most common problem), the tool must support either a split rule (e.g., 70% employee comp / 30% benefits based on payroll data) or an estimation methodology with documented assumptions. The estimation must be auditable.

4. HR and payroll data integration. Employee compensation data often lives in HR/payroll systems, not the GL. The tool needs a data feed from Workday HCM, SAP SuccessFactors, ADP, or equivalent to populate the employee compensation category accurately. A tool that relies solely on GL data will undercount or misclassify compensation.

5. Audit trail and SOX documentation. The mapping methodology is an internal control. Auditors will test whether the mapping is complete (every GL account is mapped), accurate (the mapping reflects economic reality), and consistently applied. The tool must produce evidence of preparer-reviewer approval for the mapping table and log any changes with timestamps.

Comparison of Disclosure Management Platforms

This table reflects general platform capabilities as of mid-2026. Specific configurations vary by implementation.

The Retroactive Recast Problem in Practice

This is the systems issue that most teams underestimate. The standard requires recasting prior comparative periods. For a calendar-year company adopting in fiscal 2027, that means the fiscal 2026 and fiscal 2025 columns in the DISE table must also reflect the five natural expense categories, mapped consistently with the fiscal 2027 methodology.

If your company restructured its chart of accounts between 2025 and 2027, or if GL accounts were merged or split, the mapping must still produce comparable numbers for the prior periods. This requires either:

• A mapping table that covers historical account structures (not just the current COA), or
• An impracticability determination, disclosed with an explanation of why recasting is not feasible.

The impracticability carve-out is real but narrow. Deloitte's DART FAQ quotes ASC 220-40 directly: entities must "recast the prior periods presented for comparative purposes... unless it is impracticable to do so. If it is impracticable to do so, the entity shall disclose that fact and explain why it is impracticable to recast prior periods."

The practical implication: your mapping tool needs to store historical mapping versions, not just the current one. A tool that only maintains a single current-state mapping table will force you into an impracticability disclosure that the SEC may scrutinize.

The "Other Items" Bucket: A Systems Decision, Not Just an Accounting One

ASC 220-40-50-30 requires that amounts remaining in relevant expense captions that are not separately disaggregated be presented in tabular format with a qualitative description. As Deloitte's DART FAQ notes, "there is no requirement to separately quantify these other items."

But the "other" bucket is not a free pass. Your tool must calculate it as the arithmetic difference between the total relevant expense caption and the sum of the five disaggregated categories. If that difference is large, auditors and investors will ask questions. The qualitative description of what is in "other" must be accurate and consistent period over period.

The systems implication: the DISE table must tie to the income statement caption totals. A tool that cannot enforce this tie-out automatically creates a reconciliation risk every close cycle.

Leased Employees and Expense Reimbursements: Data Sourcing Complexity

Two specific scenarios create data sourcing challenges that your tooling must handle.

Leased employees: If a leased individual meets all five conditions under ASC 220-40 (exclusive compensation rights, hire/fire/control rights, exclusive economic value determination, benefit plan participation, and lessee remittance of full compensation including payroll taxes), the compensation paid through the lessor must be captured as "employee compensation" in the DISE table. This data does not flow through the standard payroll system. It typically sits in accounts payable as a vendor payment. Your mapping tool must be configured to reclassify these AP transactions into the employee compensation category based on vendor or cost-center flags.

Expense reimbursements: ASC 220-40-50-26 through 50-29 gives entities two alternatives: disclose the reimbursement separately, or disclose natural expense categories net of reimbursement effects. Either way, the elected alternative must be disclosed, and a qualitative description of the affected categories is required. Your tool must enforce the elected alternative consistently and flag any period where the reimbursement treatment changes.

Implementation Timeline for Fiscal-2027 Adopters

For a calendar-year PBE adopting on the mandatory effective date, the clock is running. Here is a realistic milestone schedule from Q3 2026 forward:

The SAB 74 disclosure obligation is already live. SEC registrants must currently disclose a brief description of ASU 2024-03, the planned adoption date, the expected adoption method, and the anticipated impact on financial statements. If your COA mapping assessment is not complete, you cannot accurately populate the "expected impact" element. For a detailed walkthrough of SAB 74 obligations, see Finrep's SAB 74 disclosure execution guide.

IFRS 18 Dual-Reporter Consideration

Companies that report under both U.S. GAAP and IFRS face an additional question: can a single COA mapping serve both ASU 2024-03 and IFRS 18? The short answer is no, not without adjustment. The two standards are parallel but not identical in their natural expense category definitions and disclosure mechanics. For a detailed comparison, see Finrep's IFRS 18 vs ASU 2024-03 comparison.

From a tooling perspective, dual reporters should evaluate whether their disclosure management platform can maintain two separate mapping tables (one for GAAP, one for IFRS) that draw from the same underlying GL data. Building two entirely separate data pipelines is inefficient and increases the risk of inconsistency between the two sets of disclosures.

FAQ

Does ASU 2024-03 apply to private companies? No. ASU 2024-03 applies only to public business entities (PBEs). Private companies, not-for-profit entities, and employee benefit plans are excluded from the mandatory scope. However, private companies that anticipate becoming PBEs should assess the requirements in advance, because historical financial statements included in a registration statement will need to comply with ASC Subtopic 220-40.

Can we use estimates for the five natural expense categories? Yes. FASB explicitly acknowledged that some entities' systems may not track expenses using the required categories, and the standard permits estimates or other methods that reasonably approximate the required amounts. The estimation methodology must be documented, consistently applied, and auditable.

What do auditors expect to see for the COA mapping? Auditors will treat the mapping table as an internal control. They will test completeness (every GL account within a relevant expense caption is mapped), accuracy (the mapping reflects economic substance), and consistency (the same mapping is applied across all periods presented). A version-controlled mapping table with preparer-reviewer sign-off, stored in your disclosure management tool, is the minimum documentation standard. For a deeper look at controls implications, see Finrep's DISE controls guide.

What if a single GL account contains multiple natural expense types? You have two options: split the account into separate GL accounts (Option 1 above), or apply a split rule or estimation methodology at the mapping layer. The estimation must be based on supportable data (payroll records, fixed asset registers, etc.) and must be applied consistently. The methodology must be disclosed qualitatively as part of the "other items" description if it affects the composition of that bucket.

When is ASU 2024-03 effective for private companies? ASU 2024-03 is not currently effective for private companies. The mandatory scope is limited to PBEs. There is no announced effective date for private companies as of mid-2026.

Is early adoption advisable? Early adoption is permitted. The case for early adoption is strongest for companies that are already investing in financial close automation or ERP upgrades, where the incremental cost of configuring DISE mapping at the same time is low. Companies with complex COA structures or multiple segments may benefit from an extra year of parallel running before the mandatory date.