diff --git a/erpnext/accounts/doctype/account/account.py b/erpnext/accounts/doctype/account/account.py
index f1d822a89c..46f75208fc 100644
--- a/erpnext/accounts/doctype/account/account.py
+++ b/erpnext/accounts/doctype/account/account.py
@@ -23,6 +23,7 @@ class Account(Document):
 	def validate(self):
 		self.validate_parent()
 		self.validate_root_details()
+		self.set_root_and_report_type()
 		self.validate_mandatory()
 		self.validate_warehouse_account()
 		self.validate_frozen_accounts_modifier()
@@ -32,7 +33,7 @@ class Account(Document):
 		"""Fetch Parent Details and validate parent account"""
 		if self.parent_account:
 			par = frappe.db.get_value("Account", self.parent_account,
-				["name", "is_group", "report_type", "root_type", "company"], as_dict=1)
+				["name", "is_group", "company"], as_dict=1)
 			if not par:
 				throw(_("Account {0}: Parent account {1} does not exist").format(self.name, self.parent_account))
 			elif par.name == self.name:
@@ -43,10 +44,24 @@ class Account(Document):
 				throw(_("Account {0}: Parent account {1} does not belong to company: {2}")
 					.format(self.name, self.parent_account, self.company))
 
+	def set_root_and_report_type(self):
+		if self.parent_account:
+			par = frappe.db.get_value("Account", self.parent_account, ["report_type", "root_type"], as_dict=1)
+			
 			if par.report_type:
 				self.report_type = par.report_type
 			if par.root_type:
 				self.root_type = par.root_type
+			
+		if self.is_group:
+			db_value = frappe.db.get_value("Account", self.name, ["report_type", "root_type"], as_dict=1)
+			if db_value:
+				if self.report_type != db_value.report_type:
+					frappe.db.sql("update `tabAccount` set report_type=%s where lft > %s and rgt < %s", 
+						(self.report_type, self.lft, self.rgt))
+				if self.root_type != db_value.root_type:
+					frappe.db.sql("update `tabAccount` set root_type=%s where lft > %s and rgt < %s", 
+						(self.root_type, self.lft, self.rgt))
 
 	def validate_root_details(self):
 		# does not exists parent
diff --git a/erpnext/patches.txt b/erpnext/patches.txt
index 75c1dff576..78e1609990 100644
--- a/erpnext/patches.txt
+++ b/erpnext/patches.txt
@@ -183,4 +183,5 @@ execute:frappe.delete_doc("DocType", "Party Type")
 execute:frappe.delete_doc("Module Def", "Contacts")
 erpnext.patches.v5_4.fix_reserved_qty_and_sle_for_packed_items # 30-07-2015
 execute:frappe.reload_doctype("Leave Type")
-execute:frappe.db.sql("update `tabLeave Type` set include_holiday=0")
\ No newline at end of file
+execute:frappe.db.sql("update `tabLeave Type` set include_holiday=0")
+erpnext.patches.v5_4.set_root_and_report_type
\ No newline at end of file
diff --git a/erpnext/patches/v5_4/set_root_and_report_type.py b/erpnext/patches/v5_4/set_root_and_report_type.py
new file mode 100644
index 0000000000..9147644da2
--- /dev/null
+++ b/erpnext/patches/v5_4/set_root_and_report_type.py
@@ -0,0 +1,12 @@
+# Copyright (c) 2013, Web Notes Technologies Pvt. Ltd. and Contributors
+# License: GNU General Public License v3. See license.txt
+
+from __future__ import unicode_literals
+import frappe
+
+def execute():
+	roots = frappe.db.sql("""select lft, rgt, report_type, root_type 
+		from `tabAccount` where ifnull(parent_account, '')=''""", as_dict=1)
+	for d in roots:
+		frappe.db.sql("update `tabAccount` set report_type=%s, root_type=%s where lft > %s and rgt < %s", 
+			(d.report_type, d.root_type, d.lft, d.rgt))
\ No newline at end of file