© SAP AG

Phase I: Financial Accounting

SAP University Alliances

Version 2.2

Authors Simha MagalStefan WeidnerTom Wilder

ProductSAP ERP 6.0 EhP4Global Bike Inc.

LevelBeginner

FocusConfiguration: Financial Accounting

Configuration

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Agenda

Enterprise Structure

Business rules and parameters

Master data

Process execution (testing)

Exercises

Configuration

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Enterprise Structure

Enterprise structure elements- Client- Financial accounting

• Company code• Business area

- Management accounting• Operating concern• Controlling area

- Fulfillment• Credit control area

Define / Maintain- Including some parameters

Assign

Configuration

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Enterprise Structure

SD, MM, PP, etc.

FI

CO-PCA, CO-OM, CO-PC

CO-PA Operating Concern

Controlling Area

Company Code

S-Org P-Org Plant,

etc.

S-Org P-Org Plant,

etc.

Company Code

Controlling Area

Configuration

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Company Code

Used to represent a legal entity

Key organizational level for financial accounting- Books are maintained at the company code level- Financial statements are generated for company codes

Configuration

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Company Code

Buick

Cadillac

Chevrolet

GMC

Shanghai GM

One for each legal entity One for each country

GBI USA

GBI Germany

GBI Australia

Configuration

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Business Area

Internal divisions of the enterprise- Define areas of responsibility

Financial statements are generated for business areas

Configuration

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Operating Concern & Controlling Area

Company Code

Controlling Area

Operating Concern GL00

NA00

US00

NA##

US##

Operating Concern:- Relevant to profitability analysis - Represents external market

segments- Several controlling areas can be

assigned to operating concerns

Controlling Area- Organizational level in controlling- Costs are allocated within a

controlling area- Several company codes can be

assigned to a controlling area

Configuration

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Credit Control Area

Responsible for customer credit

Centralized- Once CCA for the

enterprise

Decentralized- Multiple CCA for the

enterprise- Example: North

America, Europe, Asia

Company Code

Credit Control Area

Enterprise GBI

GL00

US00 DE00

GL##

US## DE##

Configuration

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Agenda

Enterprise Structure

Business rules and parameters

Master data

Process execution (testing)

Exercises

Configuration

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Business Rules and Parameters

Global parameters (for CC)

Account groups

Field status variants

Posting periods

Number ranges

Tolerance groups

Configuration

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Business Rules and Parameters

Define field status

Field status variants- ZEXP: Expense accounts- ZGBS: General Balance

Sheet Accounts- ZMMA: Material Management

GR/IR Accounts- ZRAA: Reconciliation

Accounts- ZREV: Revenue Accounts

Demo- Field status variants- Note: FI global settings-

>Ledgers->Fields

Global parameters (for CC)- Chart of accounts- Credit control area- Fiscal year variant

• Define accounting fiscal year

• Create normal posting periods

• Create special periods for adjustments

Account Groups- Groups accounts with similar

characteristics

Configuration

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Business Rules and Parameters

Posting Periods- Define periods- Assign periods to CC- Close past periods

Document number ranges- For various documents

Tolerance groups for employees- Posting limits

Configuration

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Agenda

Enterprise Structure

Business rules and parameters

Master data

Process execution (testing)

Exercises

Configuration

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Master Data

Chart of accounts

General ledger accounts

Subsidiary (sub)ledgers

Cost elements

Cost centers

Statistical key figures

Configuration

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Chart of Accounts

An orderly definition of accounts in the general ledger

Three types of chart of accounts:- Operative COA- Country-specific COA- Group COA

Multiple charts of accounts exist- US (CAUS) , Germany (GKR), Canada (CANA)

• Country specific to meet reporting requirements- International Chart (INT)

• IFRS

Configuration

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Chart of Accounts

One COA can be used by multiple company codes- Different GM companies

(Buick, Cadillac, GMC) can use the same (US) chart of accounts

- Shanghai GM will use the Chinese chart of accounts

A company must use at least one chart of account- Can use more than one

chart of account to create alternate ledgers

Configuration

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General Ledger Accounts

Used to record all accounting impact of business transactions

Groups- Retained earnings account- Balance sheet accounts- Income statement accounts- Reconciliation accounts

Data in the general ledger accounts are segmented by organizational level- Chart of account segment- Company code segment- General ledger = COA data + Company code data

Configuration

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Master Data: General Ledger Accounts

Demo• Show available chart of accounts • Show examples of GL accounts• Show segments of data

Configuration

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Master Data: Sub-ledger and Reconciliation Accounts

Subsidiary Ledgers

Are not part of the general ledger.

Used to separate accounting for customers, vendors, and assets

Reconciliation Accounts

Are general ledger accounts

Cannot be posted to directly

Maintain the sum of the postings in sub-ledgers

Are specified in the definition of the sub-ledger

Sub ledger account

Reconciliation account

Customer Accounts Receivable

Vendor Accounts Payable

Asset (specific) Assets

Demo• Show sub ledger accounts• Show connection between sub ledger

and GL (Customer <--> AR)• Show non-reconciliation AR and AP

accounts

Configuration

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Master Data: Sub-ledger and Reconciliation Accounts

Configuration

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Master Data: Cost Center

Location where costs are incurred- Department, individuals,

special projects- Examples

• Copy center• Security department• IT Help desk

Cost bucket used to accumulate costs- Typically Overhead costs

• Payroll• Rent• utilities

Responsible for cost containment

Accumulated costs are then “charged” to other cost centers

Many processes have “orders”- Purchase orders, Production

orders, Sales orders- Expenses can be charged to

these orders

Collectively objects that can absorb costs are called controlling objects

Configuration

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Master Data: Cost Center Hierarchy

Demo• Cost center

hierarchy

Configuration

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Cost Elements

Primary Cost Element

Associated with expense accounts in G/L

All postings in the G/L expense account are also (automatically) posted in the corresponding cost element

Payroll, rent, utilities, etc

Typically uses the same number as G/L account

Secondary Cost Element

Secondary cost elements are defined only within CO and do not have a corresponding G/L account

Used for internal cost allocation among cost centers

Example:- Primary: Electricity, Gas,

Water- Secondary: Utilities

Configuration

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Posting in FI and CO

FICO

500

Supplies Expense

Debit Credit

500

NAAD1000:Administrative

Costs

Debit Credit

500

Bank Account

PCE

Configuration

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Master Data: Statistical Key Figures

An allocation base for cost allocation between cost centers

Measurable quantity- Number of employees- Square feet- Miles driven- Minutes of time (phone call)

Used in periodic allocations and distributions (CO processes)

Configuration

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Agenda

Enterprise Structure

Business rules and parameters

Master data

Process execution (testing)

Exercises

Configuration

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Process execution (Testing)

Recording of value flows ($$) as a result of other processes and transactions- General Ledger Accounting

• G/L postings for rent, utilities, wages, etc.- Accounts Payable Accounting

• Part of the procurement process- Accounts Receivable Accounting

• Part of the fulfillment process- Asset Accounting

• Acquisition, depreciation, retirement

Processes are executed to test the configuration- General Ledger Accounting in this Phase- Other testing will occur in later phases

Configuration

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Agenda

Enterprise Structure

Business rules and parameters

Master data

Process execution (testing)

Exercises

Configuration

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Exercises

1.1 - Enterprise Structure- Configure the enterprise structure

1.2 - Business Rules and Parameters- Define Business Rules and Parameters

1.3 - Master Data- Create needed master data (copy from 00 where possible)

1.4 – Process Execution (Testing)- Post several G/L transactions

Appendices- Exercises provide detailed instructions for one or few objects (e.g.,

once cost center, once vendor, etc.)- Appendices provide data from additional objects (cost centers, etc.)- Don’t forget them!!!!

Configuration

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Exercises

Enterprise Structure

Rules and Parameters Master Data Process

Execution

I.1.1: Define Company Code3

I.1.2: Define Business Area5

I.1.3: Define Empty Chart of Accounts6

I.1.4: Maintain Controlling Area7

I.1.5: Define Credit Control Area8

I.1.6: Define Variants for Open Posting Period9

I.1.7: Define Field Status Variants10

I.1.8: Enter Global Parameters11

I.1.9: Assign Company Code to Controlling Area12

I.1.10: Assign Controlling Area to Operating Concern13

I.1.11: Define Standard Hierarchy14

I.1.12: Assign Permitted Credit Control Areas15

I.1.13: Maintain Company Code for Materials16

Configuration

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Exercises

I.1.1: Define Company Code

Description: In this task, you define your own company code in the United States. The company code is the organizational unit that allows you to structure your enterprise from a financial accounting perspective. A company code possesses information that is important for financial accounting purposes. For example, each company code is assigned to exactly one country.

Warning: See “General Notes and Cautions” about table locks.

Navigation: SAP Customizing Implementation Guide ► Enterprise Structure ► Definition ► Financial Accounting ► Edit, Copy, Delete, Check Company Code

In the “Choose Activity” pop-up, double-click on Edit Company Code Data.

Configuration Step

Explanation

Navigation

Configuration

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Exercises

Tasks and Data Entry:

In the “Change View “Company Code”: Overview” screen, click on the icon.

In the “New Entries: Details of Added Entries” screen, enter the following information:

Attribute Description Data Value Company Code An organizational unit within financial accounting. US## Company Name Name of Company Code or Company ## Global Bike Inc. City City name in an address. Dallas Country The country key contains information which the

system uses to check entries such as length of the postal code or bank account number.

United States

Currency Currency key for amounts in the system. United States Dollar Language The language key designates the language in which

you display texts, enter texts, or print documents. English

Tasks and Data Entry

Enter value asspecified

(except for ##)

e.g.: US05, Dallas

Find and enterappropriateCode/Value

e.g.: US, USD, EN

Configuration

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Exercises

A note about ## vs. ###- User IDs have three digits at the end: GBI-### - Configuration can only have 99 users : 01, 02…..99- Exercises reference ##. - Substitute the last two digits from their UserID- User GBI-034 will use 34

Examples- Controlling area (North America: NA## -> NA34)- Company code (US company: US## -> US34)- Business area (Bicycles: BI## -> BI34)- Credit control area (Global: GL## -> GL34)- Exception: Operating concern (GL00 for everyone)

• Technical reason for not using GL##• Operating concern is a cross client change

Configuration

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Exercises

Two versions- Student version- Instructor version

• Includes screenshots• Notes (need to add more; you can help!)• Cautions and warnings (need to add more; you can help!)• Don’t give these to students

Configuration

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Agenda

Enterprise Structure

Business rules and parameters

Master data

Process execution (testing)

Exercises