Hasan,

What is the different between Auto Accounting Vs Create accounting using tool menu?
Which scenarios have to use Auto Accounting instead of Create accounting using tool menu?

Thanks,Raghu.K

An AR transaction creates following journals:
DR: RECEIVABLES
CR: REVENUE
Auto Accounting rules tells the system which accounts to use for Receivables and which accounts to use for Revenues. If you have not setup Auto Accounting rules then you must manually enter the accounts. Till this point accounting has not been generated (journal is not created). You have simply entered revenue and receivables account. As simple as that.
Now lets talk about Create Accounting. The job of Create Accounting is to create actual accounting lines (journal) in SLA module based on the account information, either manually entered by your and suggested by auto accounting.
Then comes the transfer to GL program which could be triggered by Create Accounting program. This program transfer information to GL interface table. Then comes the journal import program which imports this information into GL modules. Then comes the posting.

Wow!, Thanks for the clarification!

You Means, Until distribution level all the entry's are treated as transactions(Journal is not created),It doesn't matter, Is it AP or AR.
Is it correct?

Thanks, Raghu.k

That is true. Accounting is not created in the system until you run Create Accounting program.