SAP FI

What is SAP?

Its a type of ERP

People Soft, Oracle, JD Edwards, SAP and Etc..,

ERP Enterprise resource planning

- Money
- Man power
- Materials
- Machine

Why SAP?

73% - ERP Market

Vista, Winows XP, 7, 8, 10, Linux, Unix, Mac

R/2

R/3

SAP ECC

SAP ECC1, 2, 3, 4, 4.7, 5, 6

SAP ECC6 EHP1, EHP2, EHP3, EHP4, EHP5, EHP6, EHP7

SAP ECC6.0 EHP7

SAP System Application Products in data processing

SAP

Functional modules: FI, CO, MM, SD, HFM, etc..

Technical modules: ABAP, BASIS, Security, etc..,

TFIN50_1, TFIN50_2, TFIN52_1, TFIN52_2

80 Questions 60%-
Organizational units:

Client: Highest level in hierarchy. Each client is an independent unit that contains separate records, a
set of tables and data.

Ex: Document type, posting keys, Exchange rates etc..,

Company code: It represents an independent legal accounting entity. Company code is the minimum
structure required in SAP FI

Business Area: A business area represents separate areas of operation within organization an can be
used across all company codes.

Ex: Hyderabad, Mumbai, Pune, etc..,

Profit Center: A profit center evaluates the success of independent area that are responsible for
costs and revenue.

Segment: IFRS and US GAAP

Company: Consolidation report

Oil & GAS 2000(UK), 2001(India), 2002(NZ), 2003(MY)

Tele communications: 3000(India), 3001(MY), 3002(SG)

OIL & GAS 20000(Company)

20000 2000

20000 2001

20000 2002

20000 2003

Functional Area: In cost of sales accounting, overhead costs are reported according to the functional
areas in which they are incurred.

Ex: Advertisement, Finance dept, Sales, etc..,

Define company code:

Country:

Currency: INR

End User

Consultant-
Landscape:

Controlling or Management accounting: Important organization unit Controlling Area

Controlling Area: It identifies a self-contained structure for which costs and revenue can be managed
and allocated.

Cross company code controlling: Assigning more than one company code to same controlling area

Pre-requisites:

All the assigning company codes must use same operational chart of accounts
All the assigning company codes must use same Fiscal year variants

GAAP posting

ECC5.0 ECC 6.0

Depreciation US GL account

Depreciation India GL Account

Depreciation Canada GL account

New GL accounting: FAGLFLEXT

0L Leading ledger (IFRS)

1L Indian GAAP ledger (non- leading ledger)

Scenarios:

- Business area
- Profit center
- Segment
- Preparation for consolidation
- Cost of sale accounting
- Cost center

We can assign one or more scenarios to leading and non-leading ledgers

In new GL accounting only leading ledger values are posted to CO

Variant Principle:

1. Define Variant
2. Determine values for the variant
3. Assign the variant to object
Ex: Fiscal year variant, Posting period variant, Field status variant and etc..,

Fiscal Year Variant:

Calendar year:

Non-Calendar Year:

Fiscal year can be defined as :

Year Specific or Year Dependent: The number and start end dates for the periods may vary year to
year.

Short end fiscal year

The start and end dates of the posting periods for some fiscal year differ from the dates of
the other fiscal years

Year independent: The number and start and end dates for the periods are the same for every year

Fiscal year variant used to define name and number of posting periods

You can define up to 16 periods in fiscal year variants.

12 Normal periods and 4 special periods

Year shift indicator: +1 or -1

Apr Mar 2017

Apr 2017 - 0

May 2017 -0

June 2017 - 0

Dec 2017 0

Jan 2018 - -1

Feb 2018 1

March 2018 1

Oct Sep 2017

Oct -2016 - +1

Nov 2016 - +1

Dec 2016 - +1

Jan -2017 0

Dec -2017 0

Currency keys and exchange rate types:

In SAP for each currency a currency key is assigned

Ex: Euro EUR

Indian Rupee INR

US dollar - USD

Exchange rate types:

B Bank Selling rate 1USD = 70 INR

M Average rate 1 USD = 68 INR

G- Bank Buying rate 1 USD = 66 INR

Translation ratios: The relationship between currencies must be maintained per exchange rate type
and currency pair using translation ratios.

1 USD = 68 INR (USD: INR 1:1)

Exchange rates:

Tools:

- Base currency
- Exchange rate spread
- Inversion

Base currency:

Quotations:

Direct quotation: One unit of foreign currency converted into local currency

Ex: 1USD = 67 INR

Indirect quotation: One unit of local currency converted into foreign currency

Ex: 1INR= 0.015

1 USD = 67 INR

1 EUR 83 INR

1 USD 0.807 EUR

1 EUR 1.238 USD

Exchange rate Spread:

Bank Buying rate: -2 65INR

Average rate: 1 USD = 67 INR

Bank Selling rate: +2 69INR

Inversion:

1 USD = 67 INR

INR = 0.0149
Master data: Long term & permanent data. Ex: General ledger accounts, Customer accounts, Vendor
accounts

Transaction data: day to day entries posted using master data. Ex: Invoice, Journal, Sale etc..,

General ledger accounts:

Chart of accounts: List of all the GL accounts

- Language
- Length of GL account number (1- 10 digits)
- Controlling integration (Manually/Automatically creation of cost elements)
- Group chart of accounts consolidation

Same chart of accounts can be assigned to multiple company codes

Types of chart of accounts:

- Operational chart of accounts : day to day to entries
- Country chart of accounts: Legal requirement
- Group chart of accounts: Consolidation report

1000004 Cash a/c (alternative account number 1010)

Legal requirement Cash & Bank GL account : 4 digits 1000 -1999 Cash - 1010

1000 ABC 1001 Cash A/c (Group account number 1005)

2000 XYZ 1010 Cash A/c ( Group account number 1005)

DEF 1005 Cash A/c

How many chart of accounts are assigned to company code?

2 (operational & country chart of accounts)

Group chart of accounts are assigned in the chart of accounts

General ledger accounts:

GL Account group controls:

- The number ranges of the accounts

- The field status of the company code segment in the GL master record

GL account divided into two segments:

- Chart of account segment

- Company code segment
Chart of account segment tabs:
 - Type/description
- Key words
- Information

Chart of account important fields or information:

- Account number
- Account group
- Account type(P&L or Balance sheet)
- Description
- Consolidation fields(Group account number/trading partner)

Account type:

P&L accounts: Balances are carry forwarded to P&L carry forward account/Retained earnings account

Balance sheet accounts: Balances are carry forwarded to same balance sheet accounts

Company code segment:

- Control data
- Create/Bank/interest
- Information

Account currency:

Local Currency: While posting document all currency entries allowed

Foreign currency: While posting document system will only specified foreign currency transactions

Only Balance in local currency:

S GL accounts

K Vendor

D Customer

A Assets

M - Material

Reconciliation A/Cs: Its main link between GL accounts and sub ledger accounts

Open item management: Open or cleared

Line item display:

OIM & LID Should be maintained:

- Bank clearing accounts

- Salary clearing accounts
 - Clearing of GR/IR accounts(Goods receipt/Invoice receipt)

OIM & LID should not be maintained:

- Reconciliation accounts
- Revenue accounts
- Material accounts
- Tax accounts

Sort Key: It will updates the assignment number/field in the document

Field status groups: Controls the field status of the document

Field status variant-> Field status groups-> GL accounts

Same field status variant can be assigned to multiple company codes

Profit Center and Segments:

You can derive the segment values from profit center

You can assign same segment to multiple profit centers

There is no hierarchy for segments and no time reference

Customer accounts and Vendor accounts:

Customer Master record have following segments centrally:

General data(client level)

Company code segment(FI)
Sales area segment(SD)

Customer master record segment decentrally in FI:

General data(Client level)

Company code segment(FI)
Vendor master record have the following segments centrally:

General data (Client level)

Company code segment(FI)
Purchase organization segment(MM)

Vendor master record segments decentrally in FI:

General data(client level)

Company code segment (FI)

To Avoid Duplicate accounts:

Use the match code before creating a new account

Activate automatic duplication check

Customer and vendor account group controls:

Number range of the accounts

Field status of the master records
One time customer/Vendor

Number range:

- Internal: Automatically system assign the number from assigned number ranges
- External: User need to enter account number manually. It can be alphanumeric

Field status/Screen layout:

- Account Group
- Company code
- Transaction or activity

Field status priorities: SDRO or HDRO

Highest to lowest

Suppress Or Hide
Display
Required
Optional

S-O -> S

O-R->R
D-O ->D

R-O-> R

Dual Control principle: If you made any changes to sensitive fields in the customer/vendor master
records then SAP system blocks the vendor/customer master records and send for authorized person
confirmation. Authorized person can confirm or rejects the changes.

Customer is a vendor or vendor is a customer:

Enter vendor account number in customer master record and Customer account number in
vendor master record
Select clearing with customer in vendor master and clearing with vendor in customer mater

Alternative payer/Payee: We can enter the alternative/payer at general data and company code data
level. Company code date will takes highest priority than general data.

Head office/Branch office:

All postings for which the account number of the branch is specified, are automatically
posted to the head office account. The account number of the branch affected is noted in the
line items.
No line items or balances are managed in the branch account.

Document Control:

Every document is uniquely identified by:

Document number
Company code
Fiscal Year

Document principle: A document saved for every transaction posting and it will remains in the
system until its archived.

Document type: (OBA7)

The document type controls document header and helps to differentiate the business transaction
that need to be posted. A document can have only one document header.
Document types are defined at Client level

Document type controls:

- Number range for the document type

- Reversal document type
- Allowed account types
- Control data: Customer/vendor checks, net document type, Negative postings permitted,
Intercompany postings, enter trading partner.
- Field status of the document header text and reference number(required or optional)

Document number ranges: (FBN1)

Document number ranges are defined at company code level

Internal number:

External number: It can be alphanumeric

Line item are controlled by posting keys. In a document we can have 2 999 line items.

Posting key (OB41): Controls

Debit/Credit
Account type
Fields status of the document
Reversal posting key

Posting keys are defined at client level

Document field status controlled by:

- Field status groups (Field status variant)

- Posting keys

GL debit 40

GL Credit - 50

Field status priorities: S D R O or HDRO

Highest to lowest

Suppress or hide (Highest)

Display

Required

Optional (Lowest)
S O -> S

O-R -> R

O- S -> S

S- R -> Error message (field inconsistency)

Suppress and required combination causes an error.

Posting period Variant: Opening & closing of posting periods are controlled by posting period variant

Same posting period variant can be assigned to multiple company codes

+ - All account types allowed

S GL accounts

D- Customers

K Vendors

A Assets

When entering document, you enter the posting date. The SAP automatically determines the posting
period and fiscal year based on the posting date.

Posting authorizations:

Employee tolerances (OBA4)

Customer/Vendor tolerance(OBA3)
GL tolerance(OBA0)

Minimum null or blank tolerance is required

Simple documents or enjoy transactions:

- General ledger document (FB50)

- Customer Invoice (FB70)
 - Customer credit memo(FB75)
- Vendor Invoice (FB60)
- Vendor credit memo (FB65)

A document can be:

- Post
- Park
- Hold

Document Splitting:

ECC6.0 Features:

New GL
Document splitting
Segmentation(Ecc5.0)
CO-FI real time integration

Document splitting: SAP provides document splitting functionality to ensure zero balance for the
additional account assignments (like Profit center)

Data entry view: How the document appears to the document creator

General ledger view: How the document appears in the general ledger

Additional accounting objects:

Profit center
Business area
Segment

Document splitting process:

1. Active splitting (rule based)

2. Passive splitting
3. Clearing lines/Zero balance

One client can have only one document splitting method.

You can activate/deactivate document splitting at company code level

- Inheritance
- Standard account assignment
Example:

Active splitting:

Data entry view:

40 Goods A A/c Dr 9000 Mumbai

40 Goods B A/c Dr 1000 Hyderabad

40 Input tax@10% Dr 1000

31 TO Vendor A/c Cr 11000

General ledger view:

40 Goods A A/c Dr 9000 Mumbai

40 Input tax@10% Dr 900 Mumbai

31 To vendor A/c Cr 9900 Mumbai

40 Goods B A/c Dr 1000 Hyderabad

40 Input tax@10% 100 Hyderabad

31 To Vendor A/c Cr 1100 Hyderabd

Passive splitting:

Entry view:

25 Vendor a/c Dr 11000

50 Bank a/c Cr 11000

General ledger view:

25 Vendor a/c Dr 9900 Mumbai

25 Vendor a/c Dr 1100 Hyderbad

50 Bank a/c Cr 11000

Default Values:

- User master data

- System data
- Accounting functions
- Accounting master records
 - Parameter memory

Document change control: (FB02)

The following can be changes in a document:

Document header: Document header text and reference number

Line Item: Assignment field, text field, base line date and payment terms

The amount, account, posting keys or any other fields that affects the reconciliation of
cannot be changed

Document change rules:

Account type
Company code
Transaction/Special GL transaction

Pre-requisites:

Posting period must be open

Line item should not be cleared

Document Reversal (FB08):

- Normal reversal
- Negative reversal

Normal Reversal Negative Reversal

1. Dr becomes Cr and Cr becomes Dr
2. Transaction figures are increased
3. Reversal reason code
1. Dr becomes Cr and Cr becomes Dr
2. Transaction figures are not increased
3. Negative reversal reason code
4. Company code must allow negative postings
5. Document type should allow negative postings

Reversal reason controls:

- Negative postings
- Alternative posting date

Payment terms (OBB8):

Terms of payments are condition agreed upon by business partners for the payment of invoices.

Payment terms are used to define:

 Base line date for due date calculation
Cash discount periods
Cash discount percentage rates

Payment terms are:

- Assigned to customer or vendor master records

- Entered by the user
- Used at transaction of line item

Payment terms control:

- Account type: Customer, vendor

- Default for base line date:
No Default
Posting date
Document date
Entry date
- Fixed days/additional months for base line date calculations
- Payment method
- Payment block
- Cash discount % and cash discount periods(Maximum three cash discount periods)
- Day limit : Day limit enables date specific terms of payment payments in single terms of
payments key
- Installment payments:

Invoice related credit memo: Payment terms of invoice is applied

Non-invoice related credit memo: Payment terms are not valid, to make them valid enter
V in the invoice reference field.

Taxes:
SAP Allowed taxes on invoice are:

- Tax on sales/purchase
- US sales tax
- Additional taxes
- Withholding taxes

Taxation levels:
 - Federal/Country level
- State/Jurisdictional level

SAP Supports:

- Tax amount calculation

- Tax accounts postings
- Tax adjustments
- Tax reporting

Tax calculation procedure:

From
Level Condition Tax type level Account key
10 BASB Base amount
20 MWAS Output tax 10 MWS
30 MWVS Input tax 10 VST

Tax calculation procedures are assigned at country level

Account key:

- Rules
- Posting keys
- Tax accounts

Tax codes:

Cross Company Code Transactions:

Possible cross company code transactions:

- One company code makes purchases for other company codes (Central procurement)
- One company code pays the invoices for other company code (Central payment)
- One company code sell goods to other company codes

Cross company code document number:

Cross company code document number is combination of first company code document number,
first company code and fiscal year
Taxes are not distributed between company codes based on their expenses. First company code is
responsible to pay the taxes.

Clearing accounts:

1000(Bharath) 2000 , 3000

2000(Joslin) 1000 , 3000

3000(Manasi) 1000, 2000

To reduce the clearing accounts one company code treated as clearing company code:

2000 Clearing company code

1000 2000

2000 1000, 3000

3000 - 2000

Types clearing accounts:

General ledger
Customer accounts
Vendor accounts

Clearing:

- Clearing an account
- Post with clearing

A clearing transaction always creates a clearing document

Cleared item contains the following information:

Clearing date
Clearing document number
Post with clearing can be carried manually or automatically (Automatic payment program)

Clearing an account can be carried manually or automatically (Automatic clearing program)

Clearing program does not clear following items:

Sort key updates assignment field

The assignment field can combination four fields with a maximum of 18 characters

Automatic posting for clearing open items:

Cleared item not possible to reverse. We need to reset the clearing and then reverse the
entry.

Reset clearing FBRA

Payment differences:
Partial Payment: Both items are remains in open items

Residual Payment: Payment clear the invoice and for residual amount new document with reference
to original document

Exchange rate difference:

You can assign one gain or loss account to following:

- All currencies and currency types

- Per currency and currency type
- Per currency
- Per currency type

SAP HANA Application:

SAP HANA is to create a common database approach for online transaction processing(OLTP) and
Online Analytical processing(OLAP) using an in-memory column database.

Presentation layer Application layer Data base layer

SAP HANA makes financials simpler and faster

Benefits of SAP HANA platform

Single source of truth
Line item level granularity
Reports all relevant dimensions
Adaptability
Simplified reporting
Closing on the fly
Consolidation availability

Simple finance:
To use the simple finance HANA database is required

Benefits of Simple finance:

Navigating to IMG Screen

Easy Access->Tools->Customizing->IMG-> Execute project (Tcode: SPRO)

Click on SAP reference IMG Button

/n transaction code Open the transaction in same screen

/o transaction code Open the transaction in new screen

Copying and Edit the company code data:

SPRO->Enterprise structure->Definition->Financial accounting-> Edit,copy,delete, check company

code

Define company : TCode:OX15

Assign company to company code OX16

Assign company code to controlling area: OX19

Define fiscal year variant OB29

Define GL account group OBD4

Create GL account centrally FS00

Create GL accounts Centrally FS00

AE01## Entertainment expenses 00(copy from 400000)

AE02## Sports car rental expenses 00(copy from 400000)

CD03## Disbursement GR00 (copy from 113100)

Create Profit Center KE51

Create cost center KS01

Change cost center KS02

Display cost center KS03

Define Customer account group OBD2

Assign number range to customer account group OBAR

Create customer master FD01 (100304)

Define vendor account group OBD3

Assign number range to vendor account group OBAS

Create Vendor master FK01 (Vendor00)

Define field status variant OBC4

Document number ranges FBN1

GL document posting FB50

100000(petty cash a/c) Dr 500 EUR

113100(Bank A/c) CR 500 EUR

Vendor Invoice FB60

Document display FB03

Customer invoice FB70

Vendor line item display FBL1N

Customer line item display FBL5N

GL line item display FBL3N or FAGLL03

Vendor payment F-53

Customer Invoice FB70

Document change FB02

GL balance display FS10N

Document reversal FB08

Define payment terms- OBB8

Change Vendor master record FK02

Vendor Invoice FB60

Vendor payment F-53

Create Tax code FTXP

Customer Invoice FB70

Maintain cross company code clearing accounts OBYA

Vendor Invoice FB60

Display cross company code number FBU3

Customer line item display FBL5N

Customer incoming payment F-28 ( Bank account 113100)