Blake's SAP FICO 57-66 Document

(FI - 01 Thru 66) and (CO - 67 Thru 83)

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• FI stands for Financial Accounting
  • to store the financial data of an organization
  • FI has a collection of submodules
    • General Ledger contains all the transaction details of a company
    • Accounts Receivable and Payable (AR / AP), AP includes all the vendor transactions and AR includes all the customer transactions
    • Asset Accounting deals with all the fixed asset of the company
    • Bank Accounting - create and process any type of bank transactions
    • Travel Management is used to manage all the travel expenses of a company
    • Fund Management is used to manage funds in a company
    • Legal Consolidation helps an organization to treat its multiple units as a single company,
      • hence it enables to view all the details as a single financial statement for all the companies under that group.
      • An organization can get a clear idea of its financial conditions as a single entity.
      • Note: − FI-Legal Consolidation module was supported in older versions of SAP ERP implementation.
        • This work is performed by SAP Business Process Consolidation BPC and SEM-BCS now.

• CO stands for Controlling
  • It supports coordination, monitoring, and optimization of all the processes in an organization.
  • involves recording both the consumption of production factors and the services provided by an organization
  • SAP CO includes managing and configuring master data that covers cost and profit centers, internal orders, and other cost elements and functional areas.
  • The main purpose of SAP controlling module is planning.
    • It enables you to determine variances by comparing actual data with plan data and thus enables you to control business flows in your organization.
  • Data flows relevant to cost flows to Controlling from Financial Accounting.
  • At the same time, the system assigns the costs and revenues to different CO account assignment objects, such as cost centers, business processes, projects or orders.
  • The key submodules of SAP controlling system are:
    • Cost Element Accounting − Cost and Revenue Element Accounting provides you with an overview of the costs and revenues that occur in an organization.
      • Most of the values are moved automatically from Financial Accounting to Controlling.
      • Cost and Revenue Element Accounting only calculates costs which either do not have another expense or only one expense in Financial Accounting.
    • Cost Center Accounting − Cost Center Accounting is used for controlling purposes within your organization.
    • Activity-Based-Accounting − It is used to analyze cross-departmental business processes.
    • Internal Orders − Internal orders in SAP CO are used to collect and control according to the job that incurred them.
      • You can assign budgets for these jobs that is system monitored to ensure that they are not exceeded from the set budgets.
    • Product Cost Controlling − It calculates the cost for manufacture a product, or to provide a service.
      • It allows you to calculate the price at which you can profitably marketed it.
    • Profitability Analysis − It is used to analyze the profit or loss of an organization by individual market segments.
      • Profitability Analysis provides a basis for decisionmaking.
      • For example, it is used to determine price, conditioning, customer, distribution channel, and market segment.
    • Profit Center Accounting − It is used to evaluate profit or loss of individual, independent areas within an organization.
      • These areas are responsible for their costs and revenues.

(57) SAP FI - Month End Closing

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In SAP FI, month-end closing involves activities in posting a closing period. You can carry out the following activities as a part of month-end closing −

• Open and close posting periods.

• You close one or more posting periods in the past for posting, and permit posting to be made to one or more current or future posting periods.

Use the T-code F.05 or FAGL_FC_VAL for new G/L accounts.

It will open a new window wherein you need to enter the following details −

• Company Code for which Foreign Currency Valuation is to be carried out.
• Evaluation Key Date.
• Valuation Method for Exchange Rate Consideration.
• Valuation in Currency Type.

You can filter out Valuation activity by entering the appropriate parameters in the Tab Screens.

Click the Execute button . It will open a list of all G/L accounts selected for foreign currency valuation.

(58) SAP FI - Dunning

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In SAP FI, if a customer misses the payment for the outstanding invoice by payment due date, you can generate a dunning letter using SAP FI and send it to the customer address to remind him of the outstanding payment.

Requirement

The dunning system enables to trace liable customers who have not paid their open invoices within a given time span. It enables you to handle the process from, for example, sending a reminder to customers of their outstanding payments through referring such customers to collections agencies.

The dunning system covers the following documents.

• Open A/R invoices, including invoices that are partially credited or partially paid.
• Invoices that include installments.
• A/R credit memos.
• Incoming payments that are not based on invoices.

How to Create Dunning Keys?

Go to SPRO → SAP Reference IMG → Financial Accounting (New) → AR and AP → Business Transactions → Dunning → Basic Setting for Dunning → Define Dunning Keys → Execute.

Define Block Reason for Dunning

Here you define the reason for dunning block reason under a key.
It can be defined for an item or for a customer master.
Blocked item or customer account are not considered for dunning reason.

(59) SAP FI - Exchange Rates

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• Exchange Rates are used to define a relationship between two currencies and also to maintain exchange rates that are used to translate an amount into another currency.

You define exchange rates in the system for the following purposes −

• Posting and Clearing − To translate amounts posted or cleared in foreign currency, or to check a manually entered exchange rate during posting or clearing.

• Exchange Rate Differences − To determine gains or losses from exchange rate differences.

• Foreign Currency Valuation − To valuate open items in foreign currency and foreign currency balance sheet accounts as part of the closing operations.

Go to SPRO → SAP Reference IMG → SAP Netweaver → General Settings → Currencies → Enter Exchange Rates → Execute.

Exchange rates can be entered as direct or indirect quotations. In direct quotation, we give multiple of base currency to foreign currency.

Example − 1 USD = 65 × 1 INR

For indirect quotation, it will be 1/65 USD = 1 INR.

How to create direct/indirect quotation in SAP FI?

In the next window, enter the following details −

• Exchange Rate Type.
• Valid From date that is the start date from which the rates are applicable.
• First Currency.
• Quotation Rate.
• Second Currency.

After entering the details, click the Save button.
Enter the request number and click the tick mark.

(60) SAP FI - Tables in Module

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(61) SAP FI - AR Invoice Processes

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• In addition to invoicing processes delivered by SAP, you can define your own invoicing processes.
• For each process, you can adjust the behavior of the SAP invoicing program to your own requirements
  • such that only the required invoicing functions are run and under the consideration of your individual settings for these functions.
• This flexibility is in addition to non-modification enhancement which includes BAdIs, and events.

Invoicing processes are used as selection parameters for mass activities for "Invoicing in Contract Accounts Receivable and Payable".

Number ranges for invoicing documents are defined dependent on the invoicing processes.

Invoicing processes are a differentiation characteristic for the activation of optional invoicing functions.

The individual process steps of "Invoicing in Contract Accounts Receivable and Payable" are explained below.

Process Steps − Invoice Processes

Invoice processes involve the following steps −

• Data Selection − In data selection, the invoicing orders are selected for the invoicing process. You define the selection criteria for the data selection for the invoicing process.

• Creation of Invoicing Units − The invoicing orders selected are grouped into invoicing units for each contract account. You can create several invoicing units for each contract account. For each invoicing unit, "Invoicing in Contract Accounts Receivable and Payable" creates one invoicing document. You define the criteria for creating the invoicing units for the invoicing process.

• Processing of Billing Documents − The billing documents selected for an invoicing unit are included in the invoicing document. The billing document items are linked with the items of the invoicing document, and the derivations required for the posting in "Contract Accounts Receivable and Payable" (FI-CA) are performed.

• Performance of Additional Functions − In addition to processing billing documents, in "Invoicing in Contract Accounts Receivable and Payable" , you can integrate further functions of FI-CA. For example, interest calculation, creation of dunning proposals, or the calculation of charges and discounts. You define which additional functions are performed for each invoicing process.

• Account Maintenance − Using the account maintenance integrated in "Invoicing in Contract Accounts Receivable and Payable", you can perform clearing between the posting documents entered in Invoicing and the open items of the contract account posted before invoicing. You define the criteria for clearing in the clearing control.

• Update − The invoicing document created for the invoicing unit and the posting documents are written to the database. The invoicing orders processed are deleted. As well as the invoicing unit, a correspondence container for invoice printing and an extraction order for the update to BW are created.

(62) SAP FI - AR Account Analysis

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There are many types of reports that can be used for account analysis (A/R) −

• Customer Line Item Analysis
• Balance Analysis
• Customer Evaluation Report

Customer Line item Analysis

T-code − FBL5N

Customer line item report will be generated based on the open items, cleared items, and all items. It has options available to see transactions based on type: i.e., special G/L, Noted items, Parked items and vendor items.

Customer Balance

T-code − FD10N

This report will be generated as customer-wise / period-wise balances, including debit and credit amount separately. It will also display the balances related to special G/L under different form and gives the total.

Balances of open Sales Invoice, Debit note and Credit note is available under separate columns in the same report. Users have the facility to incorporate required fields by changing the report layout.

Customer Evaluations

T-code − F.30

This report helps in analyzing customer open transactions company-wise, group-wise, Credit control, etc. Users can define open transactions criteria based on due date, payment history, currency analysis, overdue items etc.

SAP T-codes to be used for Account Analysis in SAP FI −

• Customer line item display : FBL5N
• Customer Balance Display : FD10N
• Accounts Receivable info system : F.30

(63) SAP FI - AR Reporting

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There are various reports that you can generate in Account Receivable.
Following are the common reports in SAP FI AR along with their T-codes used to generate the report −

• Bill Holdings (Bill of Exchange Receivable List with ALV facility): S-ALR_87009987

• Customer Balances in Local Currency: S_ALR_87012172

• Customer Line Items: S_ALR_87012197

• Due Dates Analysis for Open Items: S_ALR_87012168

• List of Customer Open Items: S_ALR_87012173

• Customer Evaluation with Open Item Sorted List: S_ALR_87012176

• Customer Payment History: S_ALR_87012177

• Customer Open Item Analysis (Overdue Items Balance): S_ALR_87012178

• List of Customer Cleared Line Items: S_ALR_87012198

• List of Down Payments open at key date: S_ALR_87012199

• Debit & Credit Notes Register u2013 Monthly: S_ALR_87012287

• Customer-wise Sales: S_ALR_87012186

(64) SAP FI - AA Overview

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• The FI-Asset Accounting (FI-AA) component is used for managing the fixed assets in FI system.

In Financial Accounting, it serves as a subsidiary ledger to the General Ledger, providing detailed information on transactions involving fixed assets.

Integration with other components − As a result of the integration in the SAP system, Asset Accounting (FI-AA) transfers data directly to and from other SAP components.

Example

It is possible to post from the Materials Management (MM) component directly to FI-AA. When an asset is purchased or produced in-house, you can directly post the invoice receipt or goods receipt, or the withdrawal from the warehouse, to assets in the "Asset Accounting" component.

At the same time, you can pass on depreciation and interest directly to the "Financial Accounting" (FI) and "Controlling" (CO) components. From the "Plant Maintenance" (PM) component, you can settle maintenance activities that require capitalization to assets.

Components of Asset Accounting

The "Asset Accounting" component consists of the following parts −

• Traditional asset accounting
• Processing leased assets
• Preparation for consolidation
• Information System

Traditional asset accounting encompasses the entire lifetime of the asset from purchase order or the initial acquisition through its retirement. The system calculates, to a large extent automatically, the values for depreciation, interest, insurance and other purposes between these two points in time, and places this information at your disposal in varied from using the Information System. There is a report for depreciation forecasting and simulation of the development of asset values.

The system also offers special functions for leased assets, and assets under construction. The system enables you to manage values in parallel currencies using different types of valuation. These features simplify the process of preparing for the consolidation of multinational group concerns.

The "Plant Maintenance" (PM) component offers functions for the technical management of assets in the form of functional locations and as equipment. The "Treasury" (TR) component offers special functions for managing financial assets.

Create New Asset Classes

Use the T-code OAOA or go to SPRO → SAP Reference IMG → Financial Accounting → Asset Accounting → Organizational Structure → Asset Classes → Define Asset Classes → Execute.

Click New Entries as shown in the following screenshot.

In the next screen, enter the following details −

• Asset class and Short Text
• Asset Type details
• Number Range from number assignment
• Select include asset under inventory

You can also select Asset under construction (AuC).

Click the Save icon to configure the asset class.

(65) SAP FI - AA Asset Explorer

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This function shows all the values of a fixed asset, including APC values and depreciation, in various forms and summarization levels. Planned values are displayed as well as the values already posted. You use this function to display and analyze asset values.

Components of Asset Explorer

Asset Explorer consists of the following components −

• Header − This is the field where you enter the company code and asset number.

• Overview tree − Using overview tree, you can navigate between different depreciation areas. Overview tree displays objects related to the asset.

• Tab − This is where you analyze plan values and posted values using different parameters, and compare fiscal years and depreciation areas.

Note − The Asset Explorer uses ALV Grid Control for its table display. You can use it to specify the contents of the columns.

Header

With the company code and main asset number, you can also enter the asset sub-number. If you enter an asterisk (*) in the sub number field, the Asset Explorer shows all transactions and depreciation of all sub numbers of the asset main number. Use “This graphic” is explained in the accompanying text and “This graphic” is explained in the accompanying text icons to navigate to different fiscal years.

Overview Tree for Depreciation Areas

Choose the pushbutton above the overview tree, or “this graphic” is explained in the accompanying text Display master data function, to reach the display transaction for asset master data.

To navigate between depreciation areas in the overview tree, select the depreciation area you want. Icons indicate the type of depreciation area. This graphic is explained in the accompanying text icon indicates a real depreciation area, and the “This graphic” is explained in the accompanying text icon indicates a derived depreciation area.

Overview Tree for Related Objects

The system automatically searches for objects related to the asset, such as cost center, equipment, G/L account, WBS element, and displays them in an overview tree. From this overview tree, you can jump directly to the display transaction of the given master data.

There are additional options if the asset was created or posted from a purchase order. In that case, you can double click on the Purchase Orders folder to go to a report that displays all Materials Management documents that are linked to the asset.

When you enter an asterisk (*) for the sub-number in the Asset Explorer, the search for related objects is deactivated. On the Planned Values, Posted Values, and Comparisons tab pages, the system shows the total of all sub-numbers for all fields. On the Parameters tab page, the individual parameters are displayed only if they are the same for the main number and all sub-numbers. If they are not all the same (for example, the main asset and sub-numbers have different useful lives), then the field is shown with an asterisk (*).

The Transactions subscreen shows all transactions for all the sub-numbers. The display of planned/posted depreciation per period shows the total of all sub-numbers for each period. When you jump to other Asset Accounting reports, these are started without being limited to a sub-number. The report then displays all sub-numbers.

Limitations of using an asterisk (*) for the sub-number

Display of the depreciation trace (RATRACE0N) − The trace always relates to a specific asset and it is not possible to add assets together. The report is started for the asset that has the lowest sub-number.

Display of asset master record (AS03) − It is started for the first existing asset.

(66) SAP FI - Cash Management

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The Cash Management field in SAP FI is used to manage cash flows and to ensure that you have sufficient liquidity to cover your payment obligations.

Integration with other SAP components

SAP FI Cash Management is a sub-component of Financial Supply Chain Management. It can be integrated with a range of other SAP components.

Example − The liquidity forecast – in a medium- to long-term liquidity trend – integrates expected incoming and outgoing payments in financial accounting, purchase, and sales.

Features of Cash Management

SAP FI Cash Management Incomings area covers the following topics −

• Electronic and manual bank statements
• Electronic and manual check deposits
• Bill of exchange presentation
• Memo record
• Polling
• Payments
• Lockbox

Compare payment advices, "Interest calculation "and "Returned vendor checks" are dealt with the Checks topic.

Cash concentration can be found in the Planning topic. Planning also deals with the "payment program", "payment requests", "bill of exchange presentation", "memo record "and "telephone list".

The tools topic covers the "distribution" to cash management systems.

The Information System topic deals among other things with the "Liquidity forecast."

Further topics include: Payment advice journal, Compare and check "and "Reconciliation with cash management.

In the Environment area, you will find functions for transferring market data to the SAP system. Market data can be transferred using the file interface, real-time data feed, or via a spreadsheet.

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