Fico - Interview updated.docx

8/20/2019 Fico - Interview updated.docx

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General Ledger

Q 1. How many Chart of Accounts can a Company code have?

A single Company code can have only one Chart of Accountassigned to it. The Chart of Accounts is nothing but the list of GeneralLedger Accounts.

Q 2. What are the options in SAP when it comes to Fiscal years?

Fiscal year is nothing but the ay financial data is stored in the

system. !A" provides you ith the combination of 12 normal periodsand also four special periods. These periods are stored in hat iscalled the fiscal year variant.

There are to types of Fiscal #ear $ariantCalendar #ear % e.g. &an'(ec

#ear (ependent Fiscal #ear .

Q ). What is a year dependent fiscal year variant?

*n a year dependent fiscal year variant the number of days in a monthare not as per the calendar month. Let us ta+e an e,ample-' For theyear 2/ the period &anuary ends on 20th Feb ends on 2th 3archends on 20. For the year 24 &anuary ends on )

th Feb ends on

24th 3arch ends on )

th. This is applicable to many countries

especially 5!A. 6ver year this fiscal year variant needs to be

configured in such a case

Q 7. How does posting happen in !aterials anagement"during special periods?

There is no posting hich happens from 33 in special periods.!pecial periods are only applicable for the F* module. They arere8uired for ma+ing any additional posting such as closing entriesprovisions hich happen during 8uarter end or year end.

Q /. How many currencies can #e configured for a company code?

A company code can have ) currencies in total. They are localcurrency i.e. company code currency9 and 2 parallel currencies. Thisgives the company the fle,ibility to report in the different currencies.



Q 4. Are you re$uired to configure an additional ledger for parallelcurrencies?

:here only 2 currencies are configured ;Company code currency

and a parallel currency9 there is no need for an additional ledger. *ncase the third parallel currency is also configured and if it is differentthan the second currency type you ould then need to configureadditional ledger.

Q . Give some e%amples of GL accounts that should #e postedautomatically through the system and how is this defined in thesystem&

!toc+ and Consumption accounts are instances of GL accounts thatshould be automatically posted. *n the GL account master record a

chec+ bo, e,ists herein the automatic posting option is selectedcalled <"ost Automatically =nly>

Q ?. What is an Account group and where is it used?

An Account group controls the data that needs to be entered at thetime of creation of a master record. Account groups e,ist for thedefinition of a GL account $endor and Customer master. *t basicallycontrols the fields hich pop up during master data creation in !A".

Q 0. What is a field status group?

Field status groups control the fields hich come up hen the user does the transactions. There are three options for field selection.They are-(isplay only

!uppressed3andatory

!o basically you can have any field either for display only or you cantotally suppress it or ma+e it mandatory.The field status group is stored in the F* GL 3aster @ecord.

Q 1. What is the purpose of a '(ocument type) in SAP?

A (ocument type is specified at the eader level during transactionentry and serves the folloing purposes-

*t defines the Bumber range for documents

*t controls the type of accounts that can be posted to eg Assets$endor Customer Bormal GL account



(ocument type to be used for reversal of entries:hether it can be used only for atch inputsessions

(ocument Type is created for differentiating business transactions.

6.g. $endor *nvoice Credit 3emo Accrual 6ntries Customer *nvoice. *t is a to digit character.

Q 11. How are input and output ta%es ta*en care of in SAP?

A ta, procedure is defined for each country and ta, codes aredefined ithin this. There is fle,ibility to either e,pense out the Ta,amounts or capitaliDe the same to !toc+s.

Q 12. What are +alidations and Su#stitutions? ,P

$alidationsE!ubstitutions in !A" are defined for each functional areae.g. F*'GL Assets Controlling etc at the folloing levels

1. (ocument level2. Line item level

These need to be specifically activated and setting them up arecomple, and done only hen it is really needed. =ften help of thetechnical team is ta+en to do that.

Q 1). ,s it possi#le to maintain plant wise different GL codes ?

#es. To be able to do so the valuation group code should beactivated. The valuation grouping code is maintained per plant and isconfigured in the 33 module. Account codes should be maintainedper valuation grouping code after doing this configuration.

Q 17. ,s -usiness area at company code Level?

Bo. usiness area is at client level. :hat this means is that other company codes can also post to the same business area.

Q 1/. What are the different scenarios under which a -usiness Area

or a Profit Center may #e defined?This 8uestion is usually very disputable. ut both usiness Areasand "rofit centers are created for internal reporting. 6ach has its onpros and cons but many companies noadays go for "rofit center asthere is a feeling that business area enhancements ould not besupported by !A" in future versions.There are typical month end procedures hich need to be e,ecutedfor both of them and many times reconciliation might become a big



issue. A typical challenge in both of them is in cases here you donot +no the usiness Area or "rofit Center of the transaction at thetime of posting.

Q 14. What are the pro#lems faced when a -usiness area isconfigured?

The problem of splitting of account balance is more pertinent in caseof ta, accounts. The ta, accounts cannot be properly bro+en donbusiness areaise.

Q 1. ,s it possi#le to default certain values for particular fields? For e&g& company code&

#es. *t is possible to default values for certain fields here a

parameter id is present.

!tep 1 Go to the input field to hich you ant to ma+edefaults.

!tep 2 "ress F1 and then clic+ technical info push button. Thisould open a indo that displays the corresponding parameter id ;if one has been allocated to the field9 in the field data section.

!tep ) 6nter this parameter id using the folloing path on !A" 6asyaccess screen !ystem 5ser profile =n data.

!tep 7 Clic+ on parameter tab. 6nter the parameter id code and enter the value you ant as default. !ave the usersettings.

Q 1?. Which is the default e%change rate type which is pic*ed up for

all SAP transactions?

The default e,change rate type pic+ed up for all !A" transactionsis

3 ;average rate9

Q 10. ,s it possi#le to configure the system to pic* up a differente%change rate type for a particular transaction?

#es it is possible. *n the document type definition of GL you need toattach a different e,change rate type.

Q 2. What are the master data pre.re$uisites for document clearing?

The Gl Account must be managed as an open item management.This chec+bo, is there in the General Ledger 3aster @ecordcalled



=pen *tem 3anagement. *t helps you to manage your accounts interms of cleared and un'cleared items. A typical e,ample ould beG@E*@ Account in !A" ;Goods @eceivedE*nvoice @eceived Account9

Q 21. /%plain the importance of the G01,0 clearing account&G@E*@ is an interim account. *n the legacy system of a client if thegoods are received and the invoice is not received the provision ismade for the same.

*n !A" at the Goods receipt stage the system passes an accountingentry debiting the *nventory and crediting the G@E*@ Account.!ubse8uently hen an invoice is recd this G@E*@ account is debitedand the $endor account is credited. That ay till the time that theinvoice is not received the G@E*@ is shon as uncleared items.

Q 22. How many num#ers of line items in one single GL entry can youhave?

*n one document you can accommodate 000lines.

Q 2). A Finance (ocument usually has an assignment field& 2his fieldautomatically gets populated during data entry& Where does itget its value?

This value comes from the !ort +ey entered in the GL master record.

Q 27. How do you maintain the num#er range in a Productionenvironment? (o you directly create it in the Production systemor do you do it #y means of transport?

Bumber range is to be created in the production client. #ou cantransport it also by ay of a transport re8uest but creating it directlyin the production client is more advisable and common practice.

Q 2/. ,n customi3ing4 'company code productive 'means what? What

does it denote?,P=nce the company code is live ;real time transactions have started9this chec+ bo, helps prevents deletion of many programsaccidentally. This chec+ bo, is activated Hust before go live.

Q 24. What is done #y the G01,0 regrouping program?

The balance in a G@E*@ account is basically because of 2 main typesof transactions-'



Goods delivered but invoice not received % ere the Goods receipt ismade but no invoice has yet been received from the vendor. *n sucha scenario G@E*@ account ill have a credit balance.

*nvoiced received but goods not delivered % ere the *nvoiceis received from the vendor and accounted for but goods havenot been received. *n such a scenario G@E*@ account ill have adebit balance.

The G@E*@ account ould contain the net value of the above totypes of transactions. The G@E*@ regrouping program analyses theabove transactions and regroups them to the correct adHustmentaccount. The balance on account of first transactions ill beregrouped to another liability account and the balance on account of second transactions ill be regrouped to an asset account.

Q 2. What is the functionality availa#le in the financial statementversion?

*n the financial statement version the most important functionalityavailable is the debit credit shift. This is more important in case of an+ overdraft accounts hich can have a debit balance or a creditbalance. Thus in case of a debit balance you ould re8uire theoverdraft account to be shon on the Asset side. *n case of creditbalance you ould re8uire the account to be shon on the Liabilityside.

Q 2?. ,s it possi#le to print the financial statement version on aSAPscript form?

#es. *t is possible to print the financial statement version on a

!A"script form.

Q 20. How do you configure the SAPscript form financial statementversion?

*t is possible to generate a form from the financial statement versionand print the financial statements on a !A"script form. *n the

customiDing for financial statement version select the F!$ youcreated and choose Goto Generate form =ne column or Tocolumn form.

#ou can also copy form from the standard system.



Q ). ,s it possi#le to generate a financial statement formautomatically?

#es. *t is possible to generate a form automatically.

Q )1. ,s it possi#le to *eep the F, posting period open only for certainGL codes?

#es. *t is possible to +eep open the F* posting period only for certainGL codes.

Q )2. How do you *eep the F, posting period open only for certain GL

codes?

*n transaction code =/2 clic+ on ne entries and maintain aninterval or a single GL code for the account type ! ith the postingperiod variant. *f the GL codes are not in se8uence then you need to

maintain further entries for the posting period variant and accounttype !.

Q )). Can posting period variant #e assigned to more than 5 companycode?

#es. "osting period variant can be assigned to more than onecompany code.

Tell about Be GL in !A" and /%plain to me what is new G1L

The Be GL concept covers all the above mentioned functions and

re8uirements in one place hile continue providing all the e,isting functions.

Be GL functionalities are part of 6CC 4. version. oever e have done

only technical upgrade from earlier 7.e version to 6CC 4. and not the

functional upgrade. ence to reap the benefits of 6CC 4. fully e must go

for the under'mentioned Be GL functionalities offered by it.

+arious additional functionalities with the introduction of 6ew GL7

(ocument Splitting

Today in the current !A" @E) $endor line items and Customer line items

;e,cept special GL accounts9 in a financial document do not retain profitcenters. Through month'end closing activities $endor and Customer open

line items are transferred to "rofit Center accounting via F./( and 1I6I

transactions. This means that there is no real'time transfer of profit center to

"CA. Bor F* do retain any profit center for these accounts at all. Ta, Line

items bring profit center from either substitution or default profit center

assignment ;)I69. *n the Be GL scenario for each financial account

document document splitting functionality applies account assignment

information ;profit center9 to the non'assigned GL accounts ;$endor

Customer and Ta, line items in particular and any other accounts not

assigned due to any reasons in general9.



(ocument splitting function is based on the folloing model.

Accounting documents in most of the cases contain GL accounts ith

assignments. That is accounts of e,penses and revenues. !uch accounts;i.e. 6,penses or revenues9 do provide dependent GL accounts ;i.e. Accounts

payables Account receivables and ta, accounts9 ith account assignments

;profit center9 based on the conte,t ;i.e. invoice or payment9. Account

assignments from original processes are supplied to the subse8uent

processes.

For e,ample Account assignment ;profit center9 is passed on from G@E*@ account to $endor

line item in invoice and the profit center from invoice is passed on the vendor line item in

payment.

-alanced #oo*s !3ero #alance" #y dimensions li*e Profit Center4

segment4 -usiness area etc&

Today in the current !A" @E) system does not ensure that every financial

accounting document is balanced by profit center or segment or business

area. That is balance is not zero, profit center'ise or segment'ise or

business area'ise in a financial document. As a result any profit center

report does not provide Dero balance financial information ;trial balance9.

*n the Be GL every financial document can be ensured to have a Dero

balance by profit center segment or business area depending upon thebusiness re8uirements. This functionality ensures draing out balance sheet

at "rofit center level segment level or business area level.

*n a company here different steams of business are being carried on local

accounting standards do re8uire reports on segment'ise or business'ise.

This re8uirement is ensured to be met through balanced boo+s by different

dimensions ;profit center segment business are etc.9.

Concept of Jero alance

This is a document splitting functionality hich ensures that the (@ and C@

for the profit center is e8ual ith the help of Dero balancing account. This

account is used to create additional line item to balance the entries for profit

center in terms of (@ K C@. Ta+e a e,ample of entry ithout Dero balance'

Customer aEc dr. 1 "rofit center /

To !ales aEc Cr. 1 "rofit center 1



ere the balance sheet for the profit center ill not tally as there is difference

in dr and credit.

:hen balancing figl profit center is activated ith Dero balance account the

entry ill be'

Customer aEc dr. 1 "rofit center /

Jero alance ac dr 1 "rofit center 1

To !ales aEc Cr. 1 "rofit center 1

To Jero alance ac cr 1 "rofit center /

Thus the profit center balance sheet ill alays tally and the Dero balance

account ill have Dero balance.

0eal.time integration of Financial Accounting with F,-

Today in the current @E) there is no real time integration of C= ith F*

though the reconciliation of C= and F* is ensured through reconciliation

ledger period'end activities.

*n the Be GL real'time integration of C= ith F* is ensured. This ensures

transfer of cross'entity controlling postings to general ledger in real time.

This transfer allos continuous reconciliation of Cost Accounting boo+s ith

financial boo+s and removes the need for any subse8uent reconciliation.

This again ensures balanced boo+s by different dimensions as ell.

@eal time integration function or+s on the folloing model. As e +no

there are many activities hich are only internal to C=. The e,amples are

Cost allocation through distribution assessment and overhead surcharge

application settlement of costs from one cost obHect to another cost obHectetc. These business transactions do create postings only in C=.

Through real'time integration system passes a corresponding F* document

for these C= documents if and only if the posting involves any cross

controlling entities li+e different profit centers cross company codes etc.

Parallel Ledgers7

Today in the current @E) meeting the re8uirements of draing out financial

statements based on other accounting principles li+e *F@! 5! GAA" etc.

are met thorough separate !A" application i.e. !pecial "urpose Ledgers.



*n the Be GL scenario this is clubbed in F* general ledger itself.

Conse8uently Ledger concept has come into play.

:e are no able to create different Ledgers for different accounting

principles. That is one ledger for Local GAA" one for 5! GAA" one for

*F@! one ledger ith different fiscal year other than the one being used in

the company code etc. *n !A" terminology these are called Leading Ledger and Bon'leading Ledgers. The ledger for Local GAA" is called Leading

Ledger and all others are non'leading ledgers.

Leading Ledger

The leading ledger is based on the same accounting principle as that of the

consolidated financial statements. *f you use the account approach for

parallel accounting you post all data to the leading ledger. This leading

ledger is integrated ith all subsidiary ledgers and is updated in all companycodes. This means that it is automatically assigned to all company codes. *n

each company code the leading ledger receives e,actly the same settings

that apply to that company code- the currencies the fiscal year variant and

the variant of the posting periods

Bon'leading ledger

The non'leading ledgers are parallel ledgers to the leading ledger. They can

be based on a local accounting principle for e,ample. #ou have to activate anon'leading ledger for the individual company codes.

"osting procedures ith sub'ledger or GEL accounts managed on an open

item basis alays affect all ledgers. This means that you cannot perform

ledger'specific postings to sub'ledger or GEL accounts managed on an open

item basis. *f you manage GEL accounts on an open item basis to monitor

accounting aspects such as reserve allocations and reversals you need to

ta+e additional measures in your internal controls system.

Bon'leading ledgers can have different fiscal year variants and different

posting period variants per company code to the leading ledger of this

company code. The second and third currency of the non'leading ledger must

be a currency that is managed as second or third currency in the respective

company code. oever you do not have to have a second and third

currency in the parallel ledgers these are optional. Alternative currencies are

not possible.



#ou can assign any number of Bon leading ledgers to a Company code.

There is no restriction

6,ample-

!uppose your Company is in *ndia and 5!.

*n *ndia e submit the Financial !tatements to the Govt by the Fiscal #ear of

April ' 3arch. For America you are maintaining the Fiscal #ear &an ' (ec.

#our main @eporting is for *ndia !o *ndian Fiscal #ear comes the Leading

Ledger and Americas comes the Bon'Leading Ledger

For every company there ill only 1 Leading Ledger and can have many

Bon'Leading Ledgers based on your companies @eporting.

Posting logics to various ledgers:

All F* postings ill invariably go to the Leading ledger. All these postings ill

also go to the Bon'leading ledgers unless otherise restricted. :e can also

carry out Ledger specific postings. That is e can post some documentsonly to certain ledgers hile not posting the same to others.

:e have created Bon'Leading ledger L) hich is meant for posting ith

different fiscal year than the one used for the Company code. That is in

raDil company code fiscal year variant for the company code is April to

3arch ;$)9. :hile postings happen to leading ledger ith $) variant the

same ill get posted ith I7 fiscal year ;&an to (ec9 in L).

General Ledger Accounting ;F*'GL9 ;Be9

The central tas+ of GEL accounting is to provide a comprehensive picture of e,ternal accounting and accounts. @ecording all business transactions

;primary postings as ell as settlements from internal accounting9 in a

softare system that is fully integrated ith all the other operational areas of

a company ensures that the accounting data is alays complete and

accurate.

eyond fulfilling the legal re8uirements General Ledger Accounting also

fulfills other re8uirements for modern accounting-

' "arallel Accounting



General Ledger Accounting allos you to perform parallel accounting by

managing several parallel ledgers for different accounting principles.

' *ntegration of Legal and 3anagement @eporting

*n General Ledger Accounting you can perform internal management

reporting in parallel ith legal reporting. For this purpose the "rofit Center

Accounting functions are integrated ith General Ledger Accounting.

Furthermore you can generate financial statements for any dimension ;such

as profit center9.

' !egment @eporting

General Ledger Accounting supports the segment reports re8uired by the

accounting principles *F@! ;*nternational Financial @eporting !tandards9 and

5! GAA" ;Generally Accepted Accounting "rinciples9. For this purpose

General Ledger Accounting contains the !egment dimension.

' Cost of !ales Accounting

#ou can perform cost of sales accounting in General Ledger Accounting. For

this purpose General Ledger Accounting contains the Functional Area

dimension.

Features

General Ledger Accounting comprises the folloing functions for entering and

evaluating posting data-

' Choice beteen group level or company level

' Automatic and simultaneous posting of all subledger items in the

appropriate general ledger accounts ;reconciliation accounts9

' !imultaneous updating of the parallel general ledgers and of the cost

accounting areas

' @eal'time evaluation of and reporting on current posting data in the form of

account displays financial statements ith different balance sheet versionsand additional analyses.

Advantage of ne ledgeLi+e "arller Ledgers means *f you ant to 3aintain (ifferent Fiscal #ear

$ariants and

19(ifferent "osting "eriods you can do through "arller Ledger

29 !egment @eporting A! per !chedule $* ;@eporting9



)9 (ocument !plitting ;"rofit Center ise or !egment ise9 Trial alance

3atching purpose

79 Cost of !ale Accounting ;through Functional Area ise9

/9 you can Activate "rofit Center Accounting from F* !ide in 6CC 4.

*n the ne General Ledger you can display the parallel accounting using

parallel accounts ;as in @E)9 or using parallel ledgers. The F* standard

functions and reports are available for all parallel ledgers.

#" The !egment entity and the relevant reporting that are re8uired for

segment reporting according to *A! and 5.!. GAA" are available in the ne

General Ledger.

c" *n addition you can enhance the ne General Ledger fle,ibly that isyou can enter user'defined fields and update the relevant totals. 3any

standard reports can evaluate the information from the user'defined fields.

d" :hen you use the ne (ocument !plitting function ;online split9 you

can create financial statements at company code level and if re8uired for

entities such as the segment. For each document the system then creates a

Dero balance for the relevant entity for e,ample for the segment.

e" As a result you no longer have to carry out time'consumingreconciliation tas+s beteen F* and C= for the end of period since cross'

entity processes are transferred in real'time to the ne General Ledger in

Controlling. Furthermore you can for e,ample navigate from the financial

statements report results or the profit and loss statement report results to the

relevant C= report.

f" The ne General Ledger uses the same interfaces as the General

Ledger in @E). As a result users do not re8uire any additional training.

g" (ue to the ne multi'dimensional aspect in the General Ledger all

data that is relevant for the General Ledger is stored in one environment. As

a result reconciliation tas+s for e,ample beteen the general ledger and

"rofit Center Accounting or the consolidation staging ledger and processing

steps that have to be carried out repeatedly in the individual applications ;for

e,ample balance carry forard9 are no longer re8uired. :hen you use the

ne General Ledger you may not have to use the special ledger anymore.



8& (efault delivery

*n ne installations the ne General Ledger Accounting is activated by

default in my !A" 6@". :e do not recommend that ne customers use the

classic general ledger accounting since using the classic general ledger

accounting re8uires additional migrations at a later stage. As a result ne

customers re8uire e,plicit authoriDation from !A" to use the classic general

ledger accounting. *f you ant to use the classic general ledger accounting.

create and send a C!! message to !A" before you start using the system.

:hen you upgrade an @E) system to my!A" 6@" the classic General

Ledger remains active at first. *f you ant to convert your system to the ne

General Ledger you can do so ithin a proHect after you have completed the

upgrade. For more information about this topic see point ).

9& 3igration support

To ensure ma,imum security !A" supports each migration proHect ith a

migration service. This basic technical service is based on standard migration

scenarios and is provided in the form of migration pac+ages for a fi,ed price.

This service is provided by a BeGL migration bac+ office hich as set up

for this purpose. After you commission the service you are provided ith a

license +ey. This releases the migration functions.

:& enefits of Be General Ledger

Be General Ledger Accounting in my!A" 6@" has the folloing

advantages compared to classic General Ledger Accounting-

Be General Ledger Accounting has an e,tended data structure in the

standard delivery.

Customer fields can also be added to the general ledger.

:ith ;real'time9 document splitting balance sheets can be created for

entities such as <!egment>.

#ou can run a real'time reconciliation of 3anagement Accounting ;C=9 and

Financial Accounting ;F*9 % there is the real'time integration ith Controlling.

This renders time'consuming reconciliation tas+s obsoleteM

Be General Ledger Accounting ma+es it possible to manage multiple

ledgers ithin General Ledger Accounting. This is one of the possible ays of

portraying parallel accounting in the !A" system.



-an* Accounting

Q )7. How is -an* 0econciliation handled in SAP?

an+ reconciliation in !A" re8uires a ouse ban+ to be configured.

Further the an+ accounts are setup into 3ain an+ account andclearing accounts. The clearing accounts are typically classified asfollos-'=utgoing chec+ payments ;for chec+ payments made9*ncoming chec+ payments ;for chec+ paymentreceived9 =utgoing ban+ transfer *ncoming ban+ transfer

(uring the month all transactions are routed through these clearingaccounts . At the month end a statement from the ban+ is received.This statement is either electronically uploaded through electronic

ban+ statement or manual ban+ statement. After the statement is uploaded the 3ain ban+ account in !A" ill

e,actly match ith the balance reported by theban+.



All reconciliation items ill remain outstanding in the ban+ clearingaccounts.

Q )/. How do you configure chec* deposit?

The folloing are the steps for configuring chec+ deposit-'!tep1- Create account symbols for the main ban+ and incoming

chec+ account.

!tep2- Assign accounts to account symbols

!tep)- Create +eys for posting rules

!tep7- (efine posting rules

!tep/- Create business transactions and assign posting rule

!tep4- (efine variant for chec+ deposit

Q )4. What is the clearing #asis for chec* deposit?

*n the variant for chec+ deposit e need to set up the folloing

Fields-'(ocument number ;hich is the invoice number9 amount shortdescription of the customer.

The document number and the invoice amount acts as the clearingbasis.

Q ). How do you configure manual #an* statement?

The folloing are the steps for configuring manual ban+ statement-'

!tep1- Create account symbols for the main ban+ and the subaccounts

!tep2- Assign accounts to account symbols

!tep)- Create +eys for posting rules

!tep7- (efine posting rules

!tep/- Create business transaction and assign posting rule



!tep4- (efine variant for 3anual an+ statement

Q )?. How do you configure an /lectronic #an* statement?

The steps for 6lectronic an+ !tatement are the same e,cept forcouple of more additional steps hich you ill see don belo

!tep1- Create account symbols for the main ban+ and the subaccounts!tep2- Assign accounts to accountsymbols!tep)- Create +eys for posting rules

!tep7- (efine posting rules!tep/- Create transaction type

!tep4- Assign e,ternal transaction type to posting

rules!tep- Assign an+ accounts to Transactiontypes

Accounts 0eceiva#le and Accounts

Paya#le

Q )0. When you create customer and vendor num#er range4 is it

created for a company code?The customer and vendor code are at the client level. That meansany company code can use the customer and vendor code bye,tending the company code vie.

Q 7. How is +endor ,nvoice payments made?

$endor payments can be made in the folloingmanner-3anual payments ithout the use of any output medium li+e chec+setc.

Automatic "ayment program through chec+s :ire transfers (36etc.

Q 71. How do you configure the automatic payment program?

The folloing are the steps for configuring the automatic paymentprogram-'Step 5 !et up the folloing-

Co. code for "ayment transaction(efine sending and paying company code.

Tolerance days for payable

3inimum N for cash discount



3a,imum cash discount!pecial GL transactions to be paid

Step 8 !et up the folloing-

"aying company code for payment transaction

3inimum amount for outgoing paymentBo e,change rate diff

!eparate payment for each ref illEe,ch payment

Form for payment advice

Step 9 !et up the folloing-

"ayment method per country:hether =utgoing paymentChec+ or ban+ transfer or E6:hether alloed for personnel payment

@e8uired master data(oc types"ayment medium programs

Currencies alloed

Step : !et up the folloing-

"ayment method per company code for payment transactions!et up per payment method and co. code

The minimum and ma,imum amount.:hether payment per due day

an+ optimiDation by ban+ group or by postal code or no optimiDation

:hether Foreign currency alloedCustomerE$endor ban+ abroad alloed Attach the payment form chec+:hether payment advice re8uired

Step ; !et up the folloing-

an+ (etermination for "ayment Transactions

@an+ the house ban+s as per the folloing"ayment method currency and give them ran+ing nos!et up house ban+ sub account ;GL code9

Available amounts for each ban+ouse ban+ account id currency available amount

$alue date specification

Q 72. Where do you attach the chec* payment form?

*t is attached to the payment method per company code.



Q 7). Where are Payment terms for customer master maintained?

"ayment terms for customer master can be maintained at to placesi.e. in the accounting vie and the sales vie of the vendor master record.

Q 77. Which is the payment term that actually gets defaulted when thetransaction is posted for the customer !accounting view or thesales view"?

The payment term in the accounting vie of the customer mastercomes into picture if the transaction originates from the F* module. *f an F* invoice is posted ;F9 to the customer then the paymentterms is defaulted from the accounting vie of the customer master.The payment term in the sales vie of the customer master comesinto picture if the transaction originates from the !( module. A salesorder is created in the !( module. The payment terms are defaultedin the sales order from the sales vie of the customer master.

Q 7/. Where are Payment terms for vendor master maintained?

"ayment terms for $endor master can be maintained at to placesi.e. in the accounting vie and the purchasing vie.

Q 74. Which is the payment term which actually gets defaulted intransaction !accounting view or purchasing view"?

The payment term in the accounting vie of the vendor master comes into picture if the transaction originates from the F* module. *f an F* invoice is posted ;F49 to the $endor then the payment termsis defaulted from the accounting vie of the vendor master.The payment term in the purchasing vie of the vendor master comes into picture if the transaction originates from the 33module.

A purchase order is created in the 33 module. The payment termsare defaulted in the purchase order from the purchasing vie of thevendor master.

Q 7. /%plain the entire process of ,nvoice verification from G0 to

,nvoice verification in SAP with accounting entries?These are the folloing steps-

A goods receipt in !A" for a purchased material is prepared referringa purchase order.

:hen the goods receipt is posted in !A" the accounting entrypassed is-'



*nventory account (ebitG@E*@ account credit

A G@E*@ ;hich is Goods receiptE*nvoice receipt9 is a provisionaccount hich provides for the liability for the purchase. The rates for

the valuation of the material are pic+ed up from the purchase order.

:hen the invoice is boo+ed in the system through Logistics invoiceverification the entry passed is as follos-'

G@E*@ account debit$endor credit

Process Flow in

1. Generating purchase requisition ;""'33 involved9

2. Making inquiries ;339

). Raising purchase order ;339

7. Release of purchase order ;339

/. Goods received from vendor ;33 and F*9

@a 3aterial *nventory aEc (r.G@E*@ clearing aEc Cr.

4. Invoice verification and quality assurance ;F* and 339

G@E*@ clearing aEc (r$endor aEc Cr

. Goods issued for consumption ;33 F* and ""9

@a material consumption aEc (r@a material inventory account Cr

?. Production receipt ; F* 33 K ""9

Finished goods inventory aEc (rChange in stoc+ Cr

0. Finished goods delivered to customer ;33 !( K F*9

Change in stoc+ (rFinished goods inventory aEc Cr

1. Raising invoice on customers !( K F*9Customers aEc (r!ales aEc Cr



11. Receipt of payment from customers ;!ame as !('F* integration9

Q 7?. How are 2olerances for ,nvoice verification defined?The folloing are instances of tolerances that can be defined for Logistic *nvoice $erification.

!mall (ifferences3oving Average "rice variances

Quantity variances"rice variancesased on the client re8uirement the transaction can be <loc+ed> or

"osted ith a <:arning> in the event of the Tolerances beinge,ceeded.

Tolerances are nothing but the differences beteen invoice amount

and payment amount or differences beteen goods receipt amountand invoice amount hich is acceptable to the client.

Q 70. Can we change the reconciliation account in the vendor master?

#es. @econciliation account can be changed in the vendor master provided that the authority to change has been configured. Bormallye should not change the reconciliation account.

Q /. What is the impact on the old #alance when the reconciliationaccount in the vendor master is changed?

Any change you ma+e to the reconciliation account is prospectiveand not retrospective. The old items and balances do not reflect thene account only the ne transactions reflect the account.

Q /1. 2here is an advance given #y the customer which lies in aspecial GL account indicator A& Will this advance amount #econsidered for credit chec*?



*t depends on the configuration setting in the special GL indicator A. *f the<@elevant to credit limit> indicator is sitched on in the !pecial GLindicator A the advances ill be relevant for credit chec+otherise it ill not be relevant.

Q /2. ,n payment term configuration what are the options availa#le for

setting a default #aseline date?

There are 7 options available-'Bo default"osting date(ocument date

6ntry date

Q /). What is generally configured in the payment term as a defaultfor #aseline date?

Generally document date is configured in the payment term as adefault for base line date.

Q /7. How do you configure a special GL indicator for a Customer?

#ou can use an e,isting special GL indicator *( or create a ne one. After creating a special GL indicator id update the chart of accountsand the @econciliation account. Also as a last step you need toupdate the special GL code.The special GL code should also be mar+ed as a @econciliation

account. !itch on the relevant for credit limit and commitmentarning indicators in the master record.

Asset Accounting

Q //. What are the organi3ational assignments in asset accounting?

Chart of depreciation is the highest node in Asset Accounting andthis is assigned to the company code.5nder the Chart of depreciation all the depreciation calculations are

stored.

Q /4. How do you go a#out configuring Asset accounting?

The configuration steps in brief are as follos-'a9 Copy a reference chart of depreciation areasb9 Assign *nput Ta, indicator for non ta,able ac8uisitionsc9 Assign chart of depreciation area to company code



d9 !pecify account determinatione9 (efine number range interval

f9 (efine asset classesg9 (efine depreciation areas posting to generalledger

h9 (efine depreciation +ey

Q /. /%plain the importance of asset classes& Give e%amples?

The asset class is the main criterion for classifying assets. 6veryasset must be assigned to only one asset class. 6,amples of assetclass are "lantK 3achinery Furniture K Fi,tures and Computers etc.

:henever you create an asset master you need to mention the assetclass for hich you are creating the re8uired asset. *n this manner henever any asset transaction happens the GL accounts attachedto the asset class is automatically pic+ed up and the entry passed.

#ou can also specify certain control parameters and default valuesfor depreciation calculation and other master data in each assetclass.

Q /?. A company has its #oo*s prepared #ased on <an = (eccalendar year for reporting to its parent company& ,t is alsore$uired to report accounts to ta% authorities #ased on April.arch& Can assets #e managed in another depreciation area#ased on a different fiscal year variant?

Bo. Assets accounting module cannot manage differing fiscal year variant hich has a different start date ;&anuary for boo+ depreciationand April for ta, depreciation9 and different end date ;(ecember for boo+ depreciation and 3arch for ta, depreciation9. *n this case youneed to implement the special purpose ledger.

Q /0. What are the special steps and care to #e ta*en in Fi%ed assetdata migration into SAP system especially when Profit center accounting is active?

(ata migration is slightly different from a normal transaction hich

happens in Asset accounting module.

Bormally in asset accounting the day to day transactions is postedith values through F* boo+ings and at the same time the assetreconciliation is updated online in real time. :hereas *n data3igration the asset master is updated ith values through atransaction code called as A!01. The values updated on the master are =pening Gross value and the accumulated depreciation. The



reconciliation GL account is not automatically updated at this pointof time.

The reconciliation accounts ;GL codes9 are updated manuallythrough another transaction code called as =A!$.

*f profit center is active then after uploading assets through A!01you should transfer the asset balances to profit center accountingthrough a program.

Thereafter you remove the Asset GL code ;reconciliation accounts9from the )I6 table for "CA and update the Asset reconciliationaccount ;GL code9 through =A!$.

After this step you again update the Asset reconciliation account inthe )I6 table.

The reason you remove the Asset reconciliation code from )I6table is that double posting ill happen to "CA hen you update the

Asset reconciliation manually.

Q 4. ,s it possi#le to calculate multiple shift depreciation? ,s anyspecial configuration re$uired?

#es it is possible to calculate multiple shift depreciation in !A" for alltypes of depreciation e,cept unit of production. Bo specialconfiguration is re8uired.

Q 41. How do you maintain multiple shift depreciation in assetmaster?

The folloing steps are needed to maintain multiple shiftdepreciation-

The variable depreciation portion as a percentage rate is to bemaintained in the detail screen of the depreciation area.The multiple shift factor is to be maintained in the time dependent

data in the asset master record. This shift factor is multiplied by thevariable portion of ordinary depreciation.

=nce you have done the above the !A" system calculates the totaldepreciation amount as follos-'

(epreciation amount O Fi,ed depreciation P ;variable depreciation

shift factor9



Q 42. Let>s say you have changed the depreciation rates in one of thedepreciation *eys due to changes in legal re$uirements& (oessystem automatically calculate the planned depreciation as per the new rate?

Bo. !ystem does not automatically calculate the planneddepreciation after the change is made. #ou need to run a program for recalculation of planned depreciation.

Q 4). What are evaluation groups?

The evaluation groups are an option for classifying assets for reportsor user defined match code ;search code9. #ou can configure /different evaluation groups. #ou can update these evaluation groupson to the asset master record.

Q 47. What are group assets?

The ta, re8uirements in some countries re8uire calculation of depreciation at a higher group or level of assets. For this purpose youcan group assets together into so'called group assets.

Q 4/. What are the steps to #e ta*en into account during adepreciation run to ensure that the integration with the generalledger wor*s smoothly?

For each depreciation area and company code specify the folloing-

1 The fre8uency of posting depreciation ;monthly 8uarterlyetc92 C= account assignment ;cost center9

) For each company code you must define a document type for automatic depreciation posting- This document type re8uires itson e,ternal number range.

7 #ou also need to specif y the accoun ts for post ing . ;Accountdetermination9

Finally to ensure consistency beteen Asset Accounting andFinancial Accounting you must process the batch input sessioncreated by the posting report. *f you fail to process the batch input

session an error message ill appear at the ne,t posting run.

The depreciation calculation is a month end process hich is run inbatches and then once the batch input is run the system poststhe accounting entries into Finance.



Q 44. ,s it possi#le to have depreciation calculated to the day?

#es it is possible. #ou need to sitch on the indicator <(ep to theday> in the depreciation +ey configuration.

Q 4. ,s it possi#le to ensure that no capitali3ation #e posted in thesu#se$uent years?

#es it is possib le . #ou need to set it in the depreciation +eyconfiguration.

Q 4?. How are Capital Wor* in Progress and Assets accounted for in

SAP?

Capital :*" is referred to as Assets under Construction in !A" andare represented by a specific Asset class. 5sually depreciation is not

charged on Capital :*".

All costs incurred on building a capital asset can be boo+ed to an*nternal =rder and through the settlement procedure can be postedonto an Asset 5nder Construction. !ubse8uently on the actualreadiness of the asset for commercial production the Asset 5nder Construction gets capitaliDed to an actual asset.

Q 40. 2he company has procured 5 cars& @ou want to create assetmasters for each of this car& How do you create 5 asset

masters at the same time?

:hile creating asset master there is a field on the initial createscreen called as number of similar assets . 5pdate this field ith 1.:hen you finally save this asset master you ill get a pop up as+inghether you ant to maintain different te,ts for these assets. #oucan update different details for all the 1 cars.

.



F,..S( ,ntegration

Q . How do you go a#out setting the F, account determination?

F* 33 settings are maintained in transaction code =#C. :ithinthese there are various transaction +eys to be maintained li+e !R:@R G "@( etc. *n each of these transaction +eys you specifythe GL accounts hich get automatically passed at the time of entry.

Fe e,amples could be- !R' !tands for *nventory "osting(ebit

G'!tands for Goods *ssueE!crappingEdelivery of goodsetc

"@(' !tands for "rice (ifferences.

Q 1. At what level is the F,.4 F,.S( account determinationsettings?

They are at the chart of accounts level.

Q 2. What are the additional settings re$uired while maintaining or

creating the GL codes for ,nventory accounts?

*n the *nventory GL accounts ;alance sheet9 you should sitch onthe "ost automatically only tic+. *t is also advisable to maintain theaforesaid setting for all F*'33 accounts and F*'!( accounts. This

helps in preserving the sanctity of those accounts and prevents fromhaving any difference beteen F* and 33 F* and !(.

Q ). What is +aluation and Account assignment in SAP?

This is actually the lin+ beteen 3aterials 3anagement and Finance.

The valuation in !A" can be at the plant level or the company codelevel. *f you define valuation at the plant level then you can havedifferent prices for the same material in the various plants. *f you+eep it at the company code level you can have only price across all

plants.

$aluation also involves the "rice Control .6ach material is assignedto a material type in 3aterials 3anagement and every material isvaluated either in 3oving Average "rice or !tandard "rice in !A".These are the to types of price control available.



Q 7. What is +aluation Class?

The $aluation Class in the Accounting 1 $ie in 3aterial 3aster isthe main lin+ beteen 3aterial 3aster and Finance. This $aluationClass along ith the combination of the transaction +eys ;!R :@RG and "@(9 defined above determines the GL account during

posting.

:e can group together different materials ith similar properties byvaluation class. 6.g. @a material Finished Goods !emi Finished

:e can define the folloing assignments incustomiDing-

All materials ith same material type are assigned to Hust onevaluation class.

(ifferent materials ith the same material type can be assigned todifferent valuation classes.

3aterials ith different material types are assigned to a singlevaluation class.

Q /. Can we change the valuation class in the material master onceit is assigned?

=nce a material is assigned to a valuation class in the materialmaster record e can change it only if the stoc+s for that materialare nil. *f the stoc+ e,ists for that material then e cannot change thevaluation class. *n such a case if the stoc+ e,ists e have totransfer the stoc+s or issue the stoc+s and ma+e the stoc+ nil for thespecific valuation class. Then only e ill be able to change thevaluation class.

Q 4. (oes the moving average price change in the material master during issue of the stoc* assuming that the price control for thematerial is oving Average?

The moving average price in the case of goods issue remainsunchanged. Goods issues are alays valuated at the current moving

average price. *t is only in goods receipt that the moving averageprice might change. A goods issue only reduces the total 8uantityand the total value in relation to the price and the moving priceremains unchanged. Also read the ne,t 8uestion to learn more aboutthis topic.



Q . ,f the answer to the previous $uestion is @es>4 then list thescenario in which the moving average price of the material inthe material master changes when the goods are issued&

The moving average price in the material master changes in the

scenario of !plit $aluation hich is sometimes used by manyorganiDations. *f the material is subHect to split valuation the materialis managed as !everal partial stoc+s and each partial stoc+is valuated separately.

*n split valuation the material ith valuation header record ill havev moving average price. This is here the individual stoc+s of a

material are managed cumulatively. ere to valuation types arecreated one valuation type can have v ;3A"9 and the other valuation type can have s;standard price9.

*n this case henever the goods are issued from the respectivevaluation types alays the 3A" for the valuation header changes.

6,ample- *n case if you ant to maintain 2 prices for a single materialthen e ma+e use of split valuation.

A typical e,ample i can give is that.*f there is motor. the motor can bene used or bro+en status.

!o these three valuation types can be created under one valuationcategory and have different prices for these. !ay ne @s./ used@s)/ and bro+en @s1/

Q ?. What is the accounting entry in the Financial #oo*s of accountswhen the goods are received in unrestricted use stoc*? Also

mention the settings to #e done in the Automatic postings> inSAP for the specific G1L accounts&

=n receipt of the goods in unrestricted'use stoc+ the *nventoryaccount is debited and the G@E*@ account gets credited. *ncustomiDation in the automatic postings the *nventory GEL accountis assigned to the Transaction event +ey !R and the G@E*@ accountis assigned to the Transaction event +ey :@R.

Q 0. ,f a material has no material code in SAP4 can you default the

G1L account in Purchase order or it has to #e manually



entered?&

*f a material has no material code in !A" e can still default the GELaccount ith the help of material groups. :e can assign thevaluation class to a material group and then in F*'automaticposting e can assign the relevant GEL account in the Transactionevent +ey. The assignment of a valuation class to a materialgroup enables the system to determine different GEL accounts for the individual material groups.

Q ?. What is the procedure in SAP for initial stoc* uploading?ention the accounting entriesalso&

*nitial stoc+ uploading in !A" from the legacy system is done ithinventory movement type /41; a 33 transaction hich is performed9.

3aterial valuated at standard price- For a material valuated atstandard price the initial entry of inventory data is valuated on thebasis of standard price in the material master. *f you enter analternative value at the time of the movement type /41 then thesystem posts the difference to the price difference account.

3aterial valuated at moving average price- The initial entry of inventory data is valuated as follos- *f you enter a value henuploading the initial data the 8uantity entered is valuated at thisprice. *f you do not enter a value hen entering initial data then the

8uantity entered is valuated at the 3A" present in the materialmaster.

The accounting entries are- *nventory account is debited and

*nventory istorical upload account iscredited.

Q ?1. How do you configure F,.S( account determination?

The F*'!( account determination happens through an accessse8uence. The system goes about finding accounts from morespecific criteria to less specific criteria.

This is the se8uence it ould follo-

*t ill first access and loo+ for the combination of Customer accountsassignment grpE 3aterial account assignment grpE Account +ey.*f it does not find the accounts for the first combination it ill loo+ for

Customer account assignment grp and account +ey combination.Furthermore if it does not find accounts for the first 2 criterias then it

ill loo+ for 3aterial account assignment grpEAccount +ey.



*f it does not find accounts for the all earlier criterias then finally itill loo+ for Account +ey and assign the GL code.

Thus posting of !ales *nvoices into F* are affected on the basis of acombination of !ales organiDation Account type or Customer and3aterial Account assignment groups and folloing are the optionsavailable.

a. Customer AAGE3aterial AAGEAccount typeb. 3aterial AAGEAccount typec. Customer AAGEAccount type



For each of this option you can define a Gl account. Thus the systemuses this gl account to automatically pass the entries.

Logistics ,nvoice +erification

Q ?2. Can you assign multiple G1L accounts in the Purchase order for the same line item?

#es e can assign multiple GEL accounts in the "urchase order for the same line item. The costs can be allocated on a percentage or 8uantity basis. *f the partial goods receipt and partial invoice receipthas already ta+en place then the partial invoice amount can bedistributed proportionally i.e. evenly among the account assigneditems of a "urchase order. Alternatively the partial in voice amountcan be distributed on a progressive fill'up basis i.e. the invoiced

amount is allocated to the individual account assignment items oneafter the other.

Q ?). What is Credit memo and su#se$uent de#it in Logistics ,nvoice

verification?

The term credit memo refers to the credit memo from the vendor.Therefore posting a credit memo alays leads to a debit posting onthe vendor account. Credit memos are used if the 8uantity invoiced ishigher than the 8uantity received or if part of the 8uantity asreturned.

Accounting entries are - $endor account is debited and G@E*@

account is credited.

!ubse8uent debit - *f a transaction has already been invoiced andadditional costs are invoiced later then subse8uent debit isnecessary. *n this case you can debit the material ith additionalcosts i.e. G@E*@ account debit and $endor account credit. :henentering the !ubse8uent debit if there is no sufficient stoc+coverage only the portion for the available stoc+ gets posted to thestoc+ account and rest is posted to the price difference account.

Q ?7. What are Planned delivery costs and Bnplanned delivery costs?

"lanned delivery costs- are entered at the time of "urchase order. Atgoods receipt a provision is posted to the freight or customs clearingaccount.



e.g. F@6 is the account +ey for freight condition hence the systemcan post the freight charges to the relevant freight revenue accountand F@) is the account +ey for Customs duty hence the system canpost the customs duty to the relevant GEL account.

These account +eys are assigned to the specific condition types inthe 33 "ricing schema.

*n terms of *nvoice verification - *f the freight vendor and the materialvendor is the same - then e can choose the option - Goods serviceitems P "lanned delivery costs.

*f the freight vendor is different from the material vendor- then for crediting only the delivery costs e can choose the option- "lanneddelivery costs.

5nplanned delivery costs- are the costs hich are not specified in the"urchase order and are only entered hen you enter the invoice.

Q ?/. What is the #asis on which the apportionment is done of unplanned delivery costs?

5nplanned delivery costs are either uniformly distributed among theitems or posted to a separate GEL account.

For a material subHected to 3oving average price the unplanneddelivery costs are posted to the stoc+ account provided sufficientstoc+ coverage e,ists.

For a material subHected to !tandard price the unplanned deliverycosts are posted to the "rice difference account.

Q ?4. 2here are cases where ,nvoice verification is done first #eforethe Goods receipt is made for the purchase order& ,n thesecases with what values would the Goods receipt #e posted?!ince the invoice verification has been done first the Goods @eceipts

ill be valued ith the *nvoice value.



Cost Center accounting

Q ?. /%plain the organi3ational assignment in the controllingmodule?

Company codes are assigned to the controlling area. A controllingarea is assigned to the operating concern.

5nder the Controlling Area are all controlling activities of Cost Center Accounting "roduct costing "rofitability Analysis and "rofit Center are stored.

=perating Concern is the highest node in "rofitability Analysis

Q ??. What is primary Cost element and secondary cost element?

6very "rofit and Loss GL account that needs to be controlled has tobe defined as a cost element in !A". &ust as in F* General Ledger

Accounts e,ist in Controlling e have Cost element.

6ach F* General Ledger Account that is a "rofit and Loss Account isalso created as a Cost element in !A".

"rimary Cost 6lements are those hich are created from F* generalLedger Accounts and impact the financial accounts eg. Travelling

e,penses consumption account infact any "rofit and Loss GLaccount

!econdary Cost 6lements are those hich are created only incontrolling and does not affect the financials of the company. *t isused for internal reporting only. The postings to these accounts donot affect the "rofit or Loss of the company.

The folloing categories e,ist for secondary costelements-

21 *nternal !ettlement-

Cost elements of this category is used to settle order costs to obHectsin controlling such as cost centers pa segments etc.

)1 =rderE@esults Analysis-

5sed to calculate :*" on the orderEproHect



71 =verhead

5sed to calculate indirect costs from cost centers toorders

72. Assessment

5sed to calculate costs duringassessment

7) *nternal Activity Allocation

5sed to allocate costs during internal activity allocation such as3achine Labour etc

Q ?0. What are cost o#ects?

A cost obHect means a cost or a revenue collector herein all thecosts or revenues are collected for a particular cost obHect. 6,amplesof this could be cost center production order internal order proHectssales order.

Q 0. What is the difference #etween (istri#ution and Assessment?

(istribution uses the original cost element for allocating cost to thesender cost center. Thus on the receiving cost center e can see theoriginal cost element from the sender cost center. (istribution onlyallocates primary cost.

Assessment uses assessment cost element Bo 7) defined above toallocate cost. Thus various costs are summariDed under a singleassessment cost element. *n receiver cost center the original costbrea+up from sender is not available. Assessment allocates bothprimary as ell as secondary cost.

Q 01. @ou want to calculate the activity price through system? What

are the re$uirements for that?*n the activity type master you need to select price indicator 1 % "lanprice automatically based on activity.

Q 02. When activity price is calculated through system whetheractivity price is shown as fi%ed or varia#le?



Bormally hen activity price is calculated through system it is shon asfi,ed activity price since primary cost are planned as activityindependent costs.

Q 0). What is re$uired to #e done if activity price is to #e shown #othfi%ed and varia#le?

*n this case you need to plan both activity independent cost hichare shon as fi,ed costs and activity dependent costs hich areshon as variable costs.

Q 07. ,s it possi#le to calculate the planned activity output throughsystem?

#es. *t is possible to calculate the planned activity output throughsystem by using Long term "lanning process in "" module.

Q 0/. /%plain the process of calculating the planned activity outputthrough Long term planning?

*n Long term planning process the planned production 8uantities areentered for the planning year in a particular scenario. The Long termplanning is e,ecuted for the scenario. This generates the plannedactivity re8uirements ta+ing the activity 8uantities from the routingand multiplying ith the planned production.

The activity re8uirements are then transferred to the controllingmodule as scheduled activity 8uantities. Thereafter you e,ecute aplan activity reconciliation hich ill reconcile the schedule activityand the activity you have planned manually. The reconciliationprogram updates the scheduled activity 8uantity as the plannedactivity in the controlling module.

Q 04. @ou want to revalue the production orders using actual activityprices& ,s there any configuration setting to achieve this?

#es. There is a configuration setting to be done.

Q 0. Where is the configuration setting to #e done for carrying outrevaluation of planned activity prices in various cost o#ects?The configuration setting is to be done in the cost center accountingversion maintenance for fiscal year. This has to be maintained forversion . #ou need to select revalue option either using onbusiness transaction or original business transaction.



Q 0?. At month end you calculate actual activity prices in the system&

@ou want to revalue the production orders with this actualactivity prices& What are the options availa#le in the system for revaluation?

The options available are asfollos-'

#ou can revalue the transactions using periodic price average priceor cumulative price.

Further you can revalue the various cost obHects asfollos-' =n business transaction % (ifferential entries areposted=riginal business transaction % The original business transaction is

changed.

,nternal ordersQ 00. What is the purpose of defining ,nternal orders?

An e,ample ould help us understand this muchbetter.

Lets say in an organiDation there are various events such as tradefairs training seminars hich occur during the year. Bo letsassume for a second that these Trade fairs are organiDed by the3ar+eting cost center of the organiDation. Therefore in this casemar+eting cost center is responsible for all the trade fairs costs. Allthese trade fairs costs are posted to the mar+eting cost centers. Bo

if the management ants an analysis of the cost incurred for each of the trade fair organiDed by the mar+eting cost center ho ould themar+eting manager get this piece of information across to themS Thecost center report ould not give this piece of info

Bo this is here *nternal =rder steps in .*f you go through all costcenter reports this information is not readily available since all thecosts are posted to the cost center.

!A" therefore provides the facility of using internal orders hichcomes in real handy in such situations. *n the above scenario the

controlling department ould then need to create an internal order for each of the trade fair organiDed. The cost incurred for each of thetrade fair ill be posted to the internal orders during the month. At themonth end these costs hich are collected in the internal order illbe settled from these orders to the mar+eting cost center. Thus thecontrolling person is no in a position to analyDe the cost for each of the trade fair separately.

Thus internal order is used to monitor costs for short term eventsactivities. *t helps in providing more information than that is providedon the cost centers. *t can be idely used for various purposes.



Q 1. How can you default certain items while creation ofinternal order master data?

#ou can do so by creating a model order and then update the fields

hich you ant to default in this model order. Finally attach thismodel order in the internal order type in the field reference order.

=nce the above is done henever you create an internal order for this order type the field entries ill get copied from the model order.

Q 11. What is the configuration setting for the release of theinternal order immediately after creation?

#ou have to chec+ the <release immediately> chec+ bo, in theinternal order type.

Profit Center Accounting

Q 12. What is the #asic purpose of creating a Profit Center?

The basic purpose of creating a "rofit Center is to analyDe therevenues and costs for a particular product line or a plant or abusiness unit. Though you can generate balance sheets and profitand loss accounts per "rofit Center still a profit center shouldbasically be used as a tool only for internal reporting purposes.

*f legally one has to produce the alance sheets and "rofit and Loss Accounts for a profit center then it is advisable to create it as acompany code instead of a profit center

Q 1). How does the cost and revenue flow to the Profit Center?

The profit center is stored in the cost center this ay the costs flo tothe profit center.

The profit center is also stored in material master. This ay all salesorders created for the finished product automatically pic+s up the

profit center from the material master and all the revenues and costscoming from this sales order for that finished product is passed on tothis profit center.

A profit center document is created in addition to the Financedocument henever revenue or consumption ta+es place. Thisdocument contains the details of the profit center.



=nce both the costs and revenues flo to the profit center you canrite reports using the @eport "ainter to get intelligent analysis. #oucan also use !A" standard reports

Q 17. Statistical *ey figures are created in the cost center accounting module& 6ow the same statistical *ey figures arere$uired in the profit center accounting module& ,s it re$uiredto maintain the statistical *ey figure in PCA module?

Bo. !ince the statistical +ey figures are created in a controlling area."rofit center is a sub module ithin controlling area. The statistical+ey figure is created for the controlling area and as such is availablein profit center accounting module.

Q 1/. What are the precautions to #e ta*en while maintaining the9D/H ta#le for profit center accounting?

#ou should not maintain the customer and vendor reconciliationaccounts in the )I6 table. Further you should also not maintain thespecial GL accounts in this table. !ince e are transferring thecustomer and vendor balances to profit center module throughseparate month end programs. *f the reconciliations accounts aremaintained here it ill result in double posting in the profit center module.

Q 14. Should secondary cost elements #e maintained in the 9D/H

ta#le?

Bo. !ince here e maintain only those accounts for hich the valueshould flo from F* to "CA. !econdary cost elements are alreadydefined in the controlling module hich ill reflect in the postings in"CA also.

Q 1. How can the default settings #e maintained for cost elementsper company code?

The default settings can be maintained in transaction =I0. ere ecan specify for a company code cost element hich is the cost

center to be defaulted or hether profitability segment is to beautomatically derived. Further e can also maintain hether business area is mandatory or profit center is mandatory and canmaintain the default business areas and profit centers.



Profita#ility Analysis

Q 1?. /%plain the organi3ational assignment in the PA module?

The operating Concern is the highest node in "rofitability Analysis.

The operating concern is assigned to the Controlling Area.

:ithin the operating concern all the transactions of "rofitability Analysis are stored.

The operating concern is nothing but a nomenclature for defining thehighest node in "A.

Q 10. What is the functionality of the PA module?

"A module is the most important module hen it comes to analyDingthe results of the organiDation.

*n this module you basically collect the revenues from the sale orderthe costs from the production order cost center or internal order andanalyDe their results.

The interesting part about this module is that hen it collects thecosts and revenues it also collects the characteristics associated iththe costs and revenues and this is hat ma+es it stand out

!o for e.g. using "A module you can find out the folloing-

"rofit of a certain product"rofit of a certain product in a certainregion

"rofit of a certain product in a certain region by a certain customer"rofit of a certain product in a certain region by a certain salesperson

And the list can go on in depth

*t is one of the most onderful modules in the !A"

Q 11. How do you get all those characteristics defined in theprevious $uestion and how do you analy3e them?

To do so hile defining =perating concern one has to defineCharacteristics and $alue fields.

Q 111. What are characteristics and +alue Fields?



*n the operating concern to things are basicallydefined

a9Characterists

b9 $alue Fields

Characteristics are those aspects on hich e ant to brea+ donthe profit logically such as customer region product producthierarchy sales person etc

$alue Fields are values associated ith these characteristics6.g. !ales @a 3aterial Cost Labour Cost =verheadsetc

=nce you define the characteristics and value fields these values are

updated in the table.

Q 112. From where do the characteristics come from?

The characteristics hich are defined above basically come fromeither the Customer 3aster or the 3aterial 3aster.

:Q 11). How does various values !revenues and costs" flow into

PA?

The !ales @evenue comes from the Condition Type in!(.

:e need to map the Condition Type in !( to the respective valuefields in customiDing to have the revenue flo into "A.

The Cost comes from Cost estimates hich are transferred using the"A transfer structure hich e have covered in the "roduct costingsection.

The various cost components of the cost component structure isassigned to the value field of "A module and this is ho the costscome into "A.

=nce the actual revenue and the std cost defined above are capturedin "A the variances are also transferred into "A.

This ay the std cost variances e8ual the actualcost.

!o actual revenue' actual cost helps us determine theprofit.

Q 117. How do you configure the assignment of variances from



product costing to CEPA module?



The variance categories from product costing along ith cost element is tobe assigned to the value fields in C="A

Q 11/. Ence you have captured all the costs and revenues how do

you analy3e them?The costs and revenues hich e have captured in the abovemanner are then analyDed by riting reports using the @eport "ainter Functionality in !A".

Q 114. What is characteristic (erivation in Profita#ility Analysis

odule?

Characteristic (erivation is usually used hen you ant to derive thecharacteristics . An e,ample of this could be say you ant to derivethe first to characteristics of product hierarchy.

*n such cases you define characteristic derivation here you maintainthe rules hich contain the table names of the product hierarchyfields and the number of characters to be e,tracted and it alsospecifies the target characteristic field in "A.

Q 11. What is the #asic difference in customi3ing inProfita#ility analysis as compared to other modules?

*n "A hen e configure the system i.e. creating operating concernmaintain structures no customiDing re8uest is generated. Theconfiguration needs to be transported through a different transactioncalled as I6)*.

Q 11?. What is the difference #etween Account #ased Profita#ility

Analysis and Costing #ased Profita#ility Analysis?

Account based "rofitability analysis is a form of "rofitability analysis;"A9 that uses accounts as its base and has an account basedapproach. *t uses costs and revenue elements.

Costing based "rofitability Analysis is a form of profitability analysisthat groups costs and revenues according to value fields and costing

based valuation approaches. The cost and revenues are shon invalue fields.

Q 110. What are the advantages and disadvantages of Account asedprofita#ility analysis vis..vis costing #ased profita#ilityanalysis?



The advantage of Account based "A is that it is permanentlyreconciled ith Financial accounting.

The disadvantages are that it is not poerful as the costing based"A since it uses accounts to get values. Bo Contribution margin

planning can be done since it cannot access the standard costestimate. Further no variance analysis is readily available.

The advantages of the Costing based "A are manifold. They are asfollos- '

Greater @eporting capabilities since lot of characteristics areavailable for analysis.This form of "A accesses the !tandard cost estimate of themanufactured product and gives a split according to the costcomponent split ;from the product costing module9 hen the

bills are posted.Contribution margin can be planned in this module since thesystem automatically accesses the standard cost estimate ofthe product based on the valuation approaches.

$ariance analysis is ready available here since the variancecategories can be individually mapped to the value fields.

(isadvantages-'

!ince it uses a costing based approach it does not sometimereconcile ith financial accounting.

Q 12. Can #oth Account #ased and Costing #ased Profita#ilityanalysis #e configured at the same time?

#es. *t is possible to configure both types of costing basedprofitability analysis at the same time.

Q 121. What is the advantage of configuring #oth the type of Profita#ility analysis together?

The advantage of activating account based profitability analysis alongith costing based "A is that you can easily reconcile costing basedprofitability analysis to account based profitability analysis hichmeans indirectly reconciling ith financial accounting.

Q 122. ,s there any additional configuration re$uired for Account#ased profita#ility analysis as compared to costing #asedprofita#ility analysis?



Bo. There are no special configurations re8uired e,cept for activating theaccount based profitability analysis hile maintaining the

operating concern.

Q 12). What is the difference #etween Profita#ility analysis andProfit center accounting?

"rofitability analysis lets you analyDe the profitability of segments of your mar+et according to products customers regions division. *tprovides your sales mar+eting planning and managementorganiDations ith decision support from a mar+et oriented viepoint.

"rofit center accounting lets you analyDe profit and loss for profitcenters. *t ma+es it possible to evaluate different areas or units ithin

your company. "rofit center can be structured according to regionplants functions or products ;product ranges9.

Q 127. What configuration settings are availa#le to set up valuationusing material cost estimate in costing #ased profita#ilityanalysis?

*n Costing based "rofitability analysis you define costing +eys. Acosting +ey is a set of access parameters hich are used in valuationto determine hich data in "roduct cost planning should be read. *nthe costing +ey you attach the costing variant.

*n the costing +ey you specify hether the system should read thecurrent standard cost estimate the previous standard cost estimateor the future standard cost estimate or a saved cost estimate.The configuration settings to determine this costing +ey is asfollos-'

Assign costing +eys to the products % Three costing +eys can beattached to a single product for a specific point of valuation recordtype plan version.

Assign costing +eys to 3aterial types Assign costing +eys to any characteristics % #ou can use your on

strategy to determine the costing +eys. This is through user defined

assignment tables.



Product Costing

Q 12/. What are the important 2erminologies in Product Costing?7

@esults Analysis Iey % This +ey determines ho the :or+ in"rogress is calculated

Cost Components ' The brea+ up of the costs hich get reflectedin the product costing eg. 3aterial Cost Labour Cost =verhead etc

Costing !heets ' This is used to calculate the overhead inControlling

Costing $ariant ' For All manufactured products the pricecontrol recommended is !tandard "rice. To come up ith thisstandard price for the finished good material this material has to becosted. This is done using Costing $ariant. Further don belo ille,plain this concept better.

Q 124. What configuration settings are maintained in the costing

variant?Costing variant forms the lin+ beteen the application andCustomiDing since all cost estimates are carried out and saved ithreference to a costing variant. The costing variant contains all thecontrol parameters for costing.

The configuration parameters are maintained for costing typevaluation variants date control and 8uantity structure control.

*n costing type e specify hich field in the material master shouldbe updated.

*n valuation variant e specify the folloingthe se8uence or order the system should go about accessing prices

for the material master ;planned price standard price movingaverage price etc9.*t also contains hich price should be considered for activity price

calculation and .o the system should select =3 and routing.



Q 12. How does SAP go a#out costing a Product having multiple-ill of materials within it?

!A" first costs the loest level product arrives at the cost and thengoes and cost the ne,t highest level and finally arrives at the cost of the final product.

Q 12?. What does the concept of cost roll up mean in productcosting conte%t?

The purpose of the cost roll up is to include the cost of goodsmanufactured of all materials in a multilevel production structure atthe topmost level of the =3;ill of 3aterial9

The costs are rolled up automatically using the costing levels.The system first calculates the costs for the materials ith the loestcosting level and assigns them to cost components.

The materials in the ne,t highest costing level ;such as semi'finishedmaterials9 are then costed. The costs for the materials costed first arerolled up and become part of the material costs of the ne,t highestlevel.

Q 120. What is a settlement profile and why is it needed?

All the costs or revenues hich are collected in the "roduction order or !ales order for e,ample have to be settled to a receiver at the endof the period. This receiver could be a Gl account a cost centerprofitability analysis or asset. Also read the 8uestion <:hat is a costobHect < in the section Controlling.

*n order to settle the costs of the production order or sales order a settlement profile is needed.

*n a settlement profile you define a range of control parameters for settlement. #ou must define the settlement profile before you canenter a settlement rule for a sender.

The !ettlement "rofile is maintained in the =rder Type and defaultsduring creating of order..!ettlement profile includes-'

19 the retention period for the settlement documents.



29 $alid receivers GL account cost center order :! element fi,edasset material profitability segment sales order cost obHects order itemsbusiness process)9 (ocument type is also attached here

79 Allocation structure and "A transfer structure is also attached to the

settlement profile e.g. A1

The settlement profile created is then attached to the order type.

Q 1). What is 2ransfer or Allocation structure?

The transfer structure is hat helps in settling the cost from one cost obHectto the receiver. *t is maintained in the !ettlement profile definedabove.

The Transfer structure has 2 parts-

!ource of cost elements you ant to settleTarget receiver hether it is a "rofitability segment or fi,ed asset or

cost center

!o basically for settling the costs of a cost obHect you need to define theTransfer structure here you mention hat are the costs you ant tosettle and the target receiver for that.

This information you fit it in the settlement profile hich contains variousother parameters and this settlement profile is defaulted in the =rder type. !o every time a order is e,ecuted the relevant settlement ruleis stored and at the month end by running the transaction of thesettlement of orders all the cost is passed on to the receiver

!o to put in simple terms-

#ou define your cost obHect hich could be a production order a salesorder for eg #ou collect costs or revenues for it #ou determine here youant to pass these costs or revenues to for eg if the s ales order is the costobHect all the costs or revenues of a sales order could be passed to"rofitability Analysis

Q 1)1. What do you mean #y a primary cost component split?

"rimary cost split is defined hen you create a cost componentstructure. :hen you sitch on this setting the primary cost from the



cost center are pic+ed up and assigned to the various costcomponents.

Q 1)2. How do primary costs get pic*ed up from cost center into

the cost component structure?This is possible hen you do a plan activity price calculation from!A". The primary cost component structure is assigned to the planversion in controlling.

Q 1)). ,s it possi#le to configure 8 cost component structures for the same product in order to have 8 different views?

#es it is possible. :e create another cost component structure andassign it to the main cost component structure. This cost componentstructure is called Au,iliary cost component structure hich providesanother vie of the cost component structure.

Q 1)7. How do you go a#out configuring for the sales order costing?

The flo is as follos-

!ales order ' @e8uirement Type' @e8uirement Class' Allsettings for controlling

*n a sales order you have a re8uirement type .*n configuration there8uirement Class is attached to the re8uirement type and in thisre8uirement class all configuration settings are maintained for

controlling.

*n the re8uirement class e attach the costing variant e attach thecondition type 6I2 here e ant the sales order cost to beupdated and the account assignment category. *n the accountassignment category e define hether the sales order ill carrycost or not. *n case if e do not ant to carry cost on the sales order e +eep the consumption posting field blan+.

:e also define here the @esults Analysis version hich helps tocalculate the @esults Analysis for the !ales order if re8uired.

Q 1)/. 2here are 8 plants in a company code& First plant is themanufacturing plant and another plant is the selling plant&Finished goods are manufactured at the manufacturing plantand transferred to the selling plant& How is s tandardcost estimate calculated at the selling plant given the factthat the cost at #oth the plant should #e the same?

The special procurement type needs to be configured hich specifiesin hich plant the system is to loo+ up for cost. ere a special

procurement +ey specifying plant 1 ;manufacturing plant9 should be



configured. This special procurement type must be entered in thecosting vie or the 3@" vie of the Finished good material master record in plant 2.

:hen you cost the finished good at plant 2 the system ill transfer the standard cost estimate from plant 1 to plant 2

Q 1)4. What is mi%ed costing in SAP? Give an e%ample to e%plain&

3i,ed costing is re8uired hen different processes are used tomanufacture the same material. 3i,ed costing is re8uired hen youhave different sources of supply for purchasing the material.

Let us ta+e ane,ample-'

There is a finished good Rylene hich can be manufactured by )

different processes.

The first process uses an old machine and labour. The processingtime is 0 hrs to manufacture.

The second process uses a semi'automatic machine and labour. Theprocessing time is hrs to manufacture.

The third process uses a fully automatic machine and the processingtime is / hrs.

Thus cost of manufacture for the ) processes is different. y using3i,ed costing you can create a mi,ed price for the valuation of thisfinished good.

Q 1). What configuration needs to done for using i%ed costing?

Quantity !tructure type for mi,ed costing must be configured. eree specify the time dependency of the structure type . The folloingoptions e,ist#ou have no time dependency.

*t is based on fiscal year *t is based on period



This 8uantity structure type is then assigned to the costingversion.

Q 1)?. Let>s say for a product there e%ists three production versions&/%plain the process how you would go a#out creating a mi%edcost estimate?

The process of creating a 3i,ed cost estimate ould be asfollos-' Create procurement alternatives for each of the productionversion. (efine 3i,ing ratios for the procurement alternatives!elect the configured 8uantity structure type and e,ecute a materialcost estimate based on the costing version.

Q 1)0. What are i%ing ratios and why are they re$uired to #emaintained #efore creation of cost estimate?

3i,ing ratios are eighting factors assigned to the procurementalternatives. This eighting factor is obtained from the planningdepartment based on the usage of the procurement alternativesduring the planning year.

For e.g.

"rocurement alternative 1 ;production version 19 7N ill bemanufactured

"rocurement alternativemanufactured"rocurement alternative

2

)

;production

;production

version

version

29

)9

)/N

2/N

ill

ill

be

bemanufactured

This N ill be maintained as mi,ingratios.

Thus hen system calculates the mi,ed cost estimate system illfirst cost each of the production version and then multiply each of thecosts ith the eighting factors.

Thus

27 ;cost of prod. $ers 19 R 7 O 0421 ;cost of prod. $ers 29 R )/ O )/

14 ;cost of prod vers )9 R 2/ O 73i,ed costs 1)/E1 O 1)./

Q 17. 2here are 0esult analysis categories in W,P !Wor* in Process"&

What do you mean #y the result analysis category 0eserves for unreali3ed costs?



*f you are calculating the or+ in process at actual costs the systemill create reserves for unrealiDed costs if the credit for the productionorder based on goods receipts is greater than the debit of the order ith actual costs incurred. The @esult analysis category @5C@;@eserves for unrealiDed cost9 ould need to be maintained.

Bormally this is not maintained in most of the companies.

Q 171. Which is the 0esult analysis category which is normallymaintained for the W,P !Wor* in Process" calculation?

The @esult analysis category :*"@ ' :or+ in process ithre8uirement to capitaliDe costs is normally maintained for :*"calculation.

Q 172. (escri#e a -y.product in SAP?

A y'product in !A" is described as an item ith a negative 8uantityin the ill of 3aterial. y'product reduces the cost of the mainproduct. There is no ill of 3aterial for a y'product.

Q 17). How do you calculate the cost for a -y.product in SAP?

The cost for the y'product is the net realiDable value. This ismanually maintained in the system for the by'product throughtransaction code 3@21 "rice change.

Q 177. How do you define a Co.Product in SAP?

A Co'product ;primary product or by'product9 is indicated by a tic+ inthe costing vie of the material master. *n the =3 all the primaryproducts are represented as an item ith negative 8uantity. Aprimary product is also indicated as a co'product in the =3 of theleading co'product. For primary products the costs are calculatedusing the apportionment method hile for by'products the netrealiDable value method applies.

Q 17/. ,s it possi#le to use Standard SAP Co.product functionality in0epetitive manufacturing?

Bo. *t is not possible to use the !tandard Co'product functionality inrepetitive manufacturing

Q 174. How do you got a#out defining CE.Product functionality in

0epetitive manufacturing?



*n the @epetitive manufacturing you need to use the Costing =3 for the other co'product. Through arithmetical calculation you need tomaintain the 8uantities in the costing =3. This co'product ill beshon as a negative item in the leading co'product.

Q 17. @ou get an error while e%ecuting a cost estimate which says),tem no 5 !which is a raw material" is not assigned to the costcomponent structure? What could #e the possi#le cause of error in this scenario?

The consumption GL code for the material master is not assigned tothe cost component structure. To find out ho you can +no hichGL code to assign read the ne,t 8uestion.

Q 17?. ,n the a#ove scenario how do you *now which cost elementis #eing called for?

*n this case you need to the use simulation mode =3: in 33 andenter the material code plant and the movement type 241 ;issueagainst production order9. #ou ill see the account modifier $@ andagainst hich the GL code is available.

Q 170. @ou get an error while e%ecuting a cost estimate4 whichsays) ,tem no& 5 !which is a raw material" is not assigned tothe cost component structure? ,n this case everything isperfectly configured4 what could #e the possi#le error in thisscenario?

*n the material master of the ra material the valuation class updatedin the accounting vie is incorrect.

Q 1/. ,s it possi#le to calculate standard cost estimate for a

past date?

Bo. *t is not possible to calculate standard cost estimate for a pastdate.

Q 1/1. @ou want to revalue the production orders using actualactivity prices& ,s there any configuration setting to achievethis?

#es. There is a configuration setting to be done.



Q 1/2. How do you configure that the results of the standardcost estimate are updated in other fields other than thestandard price?

The price update in the material master is defined in Costing type.This costing type is attached to the costing variant.

Q 1/). What do you mean #y Assem#ly scrap and how is itmaintained in SAP?

Assembly scrap is scrap that is e,pected to occur during theproduction of a material hich is used as an assembly.

*f a certain amount of scrap alays occurs during the production of an assembly the 8uantities and activities used must be increased bythe system so that the re8uired lot siDe can be produced.

To increase the lot siDe of an assembly you can enter a percentageflat'rate assembly scrap in the 3@" 1 vie of the material master record. This assembly scrap is reflected in all the subordinatecomponents. The system increases the 8uantity to be produced bythe calculated scrap 8uantity. This increases both the materialsconsumed and the activities consumed and conse8uently the cost.

Q 1/7. How are scrap costs shows in the standard cost estimate?

!crap costs are assigned to the relevant cost component and can beshon separately for a material in the costed multilevel =3.

Q 1//. How are scrap variances calculated?

!crap variance are calculated by valuating the scrap 8uantities iththe amount of the actual costs less the planned scrap costs.

Q 1/4. What do you mean #y Component scrap and how is itmaintained in SAP?

Component scrap is the scrap of a material that is e,pected to occur during production. :hen an assembly is produced ith thiscomponent the system has to increase the component 8uantity toenable to reach the re8uired lot siDe. The component scrap can beentered in the =3 item or in the 3@" 7 vie of the material master.

Q 1/. What do you mean #y Eperation scrap and how is it

maintained in SAP?



=peration scrap is a scrap that is e,pected to occur duringproduction. =peration scrap is used to reduce the planned input8uantities in follo up operations and to calculate the precise amountof assembly scrap. =peration scrap can be maintained in N in therouting and in the =3.

Q 1/?. What are the implications if the operation scrap is maintainedin the routing and if it maintained in the -E?

*f the operation scrap is maintained only in the routing the costing lotsiDe is reduced by this percentage.

*f the operation scrap is maintained in the =3 the planned input;not the output 8uantity9 is increased and any assembly scrap isreduced.

Q 1/0. What is the meaning of additive costs in SAP and why is itre$uired?

Additive costs are used to add costs manually to a material costestimate hen it cannot be calculated by the system. 6,amples of such costs are freight charges insurance costs and stoc+ transfer costs.

Q 14. What is the configuration re$uired for additive costs?

To include additive costs in the material cost estimate you need toset the indicator <*ncl. additive costs> for each valuation strategy inthe valuation variant.Further you also need to set in the costing variant to include additivecosts.

Q 141. How do you configure split valuation?

The configuration steps involved in split valuation-'

Activate split valuation % Configure hether split valuation is alloedfor the company code.

(etermine the valuat ion categories and valuation types thatare alloed for all valuation areas.

Allocate the valuation types to the valuationcategories

the local valuation categories for each valuation area and activatethe categories to be used in your valuation area.

Q 142. What is valuation category and valuation type in split valuation?



*n split valuation the material stoc+ is divided according to valuationcategory and valuation type.

$aluation category determines ho the partial stoc+s are dividedaccording to hich criteria. The folloing valuation categories are

preset in the standard !A" @E) system %

' "rocurement type % =rigin type

R % Automatic batch valuation

$aluation type describes the characteristic of individual stoc+.e.g. 6*G6B *nhouse production ;!A" standard9

F@63( 6,ternal procurement ;!A" standard9

$aluation types are assigned to valuation categories.

Q 14). What are the steps involved #efore you run a cost estimate for

a split valuated material?

The folloing are the steps-'Create procurement alternatives based on the valuation types for the

material.3aintain 3i,ing ratios for the procurement alternatives

Q 147. How do you create a material master with splitvaluation?

To create a split valuated material master proceed asfollos-'First create a valuation header record for the material. 5pdate the

$aluation category field on the accounting screen leave the$aluation type field blan+. *n the "rice control field enter $ ;movingaverage price9. :hen you save the system creates the valuationheader record.Then create the material for a valuationtype.

Call up the same material in creation mode again. (ue to the factthat a valuation header record e,ists the system re8uires you to

enter a valuation type for the valuation category.). @epeat !tep to for every valuation type planned.

Q 14/. When a standard cost estimate is run for a finished gooddoes SAP calculate cost estimate for its components such asraw and pac*ing material?

#es. !A" calculates the cost estimate even for ra and pac+ingmaterial and stores it in the standard price field for informationpurposes



Q 144. How do you prevent the system from calculating thecost estimate for raw and pac*ing material when you run astandard cost estimate for the finished goods?

To prevent the system from calculating cost estimates for ra andpac+ing material you need to select the <Bo costing> chec+bo, in thecosting vie of the material master.

Q 14. How is it possi#le to apply 8 different overhead rates for 8 different finished goods?

*t is possible through overhead groups. #ou configure 2 overhead+eys. (efine rates for each of this overhead +ey. These tooverhead +eys is then assigned to the to overhead groups. These

overhead groups are attached in the costing vie of the finishedgoods material master.

Q 14?. ,n period 5 there is a W,P posted of 88 BS( in period 8some further goods issue are done to the e%tent of 5; BS(& How will system calculate W,P for period 8?

!ystem ill post a delta :*" of 1/ 5!( in period2.

Q 140. What is the #asic difference in W,P calculation in product

cost #y order and product cost #y period !repetitivemanufacturing"? Generally in product cost by order :*" iscalculated at actual costs and in product cost by period :*" iscalculated at target costs

Q 1. What are the configuration settings for calculating W,P in SAP?

#ou define secondary cost elements of type )1 first.

#ou then need to define the @esults Analysis version

This results analysis contains line ids hich are basically nothing butbrea+ up of costs

Be,t you define assignments ' here you assign source costelements to the line ids defined above

#ou also define the secondary cost elements hich are assigned tothe line ids.



*n the end you define the Finance GL accounts hich are debitedand credited hen a :or+ in "rogress is calculated.

Q 11. How does SAP calculate Wor* in Process !W,P" in productcost #y order?

The system first runs through all the production order for the monthand chec+s for the status of each production order. *f the status of theproduction order is @6L ;@eleased9 or "@6L ;"artially released9 andif costs are incurred for that order system calculates :*" for theproduction order.The system cancels the :*" for the production order hen the statusof the order becomes (L$ ;delivered9 or T6C= ;Technicallycomplete9.

Q 12. 2here is a production order with order $uantity 5 *gs&(uring the month ; *gs of goods were produced& What will#e the system treatment at the month end?

The system ill first chec+ the status of the production order. !incethe status of the order is not (L$ ;(elivered9 it ill calculate a :*"for the production order.

Q 1). Why does the system not calculate variance for the ; *gswhich has #een delivered?

*n the product cost by order component the system does notcalculate a variance for partially delivered stoc+ on the productionorder. :hatever is the balance on the production order is consideredas :*". *n the product cost by period component system illcalculate :*" as ell as variance provided.

Q 17. ,s the W,P calculated in the product cost #y order componentat actual costs or standard costs?

*n the product cost by order component the :*" is calculated atactual costs.

Q 1/. ,s the W,P calculated in the product cost #y periodcomponent at actual costs or target costs?

*n the product cost by period component the :*" is calculated attarget costs.



aterial Ledger

Q 14. What precautions have to #e ta*en while switching onthe material ledger for a plant?

A material ledger once activated for a plant cannot be sitched off.Therefore it is important that the material ledger be activatedcarefully for a plant.

Q 1. How do you go a#out configuring material ledger?

The folloing are the steps-'

Activate $aluation Areas for 3aterial Ledger

Assign Currency Types to 3aterial Ledger Type

Assign 3aterial Ledger Types to $aluation Area

3aintain Bumber @anges for 3aterial Ledger (ocuments

Activate Actual costing ;hether activity update relevant for pricedetermination9

Activate Actual cost component split

CustomiDing settings in =#C

Q 1?. What are the pro#lems faced when a material ledger isactivated?

:hen a material ledger is activated it is imperative that actual costingrun has to be done every month. Actual costing run needs to be doneimmediately after the ne month roll over. After the actual costing runyou cannot post any 33;3aterials 3anagement9 entry to theprevious period.

Q 10. What are the options availa#le while performing revaluationin an actual costing run?

There are 2 optionsavailable-'

@evaluation % #ou can revalue the finished goods stoc+ Accrual % #ou can accrue the revaluation gain or loss ithout actuallychanging the price in the material master.



Q 1?. What is the configuration setting to #e done for posting theaccrual in the actual costing run?

*n transaction code =#C select transaction +ey LI: and maintain

the balance sheet account for accrual.

Q 1?1. What are the steps to #e ta*en #efore you e%ecute an actualcosting run?

The folloing are the steps to be ta+en-

1.9 6,ecute all the allocation cycles in the cost center accountingmodule.

2.9 6,ecute actual activity price calculation.).9 @evalue all the production orders ith the actual activity pric es.

The under or over absorbed cost on cost centers are passed on tothe

production order through this step of revaluation of productionorders.

7.9 Calculate overheads do a variance calculation and finally settle theproduction order.

/.9 Finally e,ecute the actual costing run.

Q 1?2. What happens in an actual costing run?

*n actual costing run there is a process of single level pricedetermination and multi level price determination. The productionprice difference variances are collected on the material ledger for each of the finished goods and semi finished goods.

(uring single level price determination the price difference collectedon a single finished product is allocated to consumption. Thisallocation to the consumption is not individually allocated to the goodissues.

*n multi level price determination the price difference is allocated toindividual goods issue. The price differences are passed on to thene,t level of consumption.

The system calculates a eighted average price for the finishedgoods and semi finished goods. This eighted average price iscalled as the periodic unit price.

Q 1?). What happens when the revaluation is done in actual costing

run for the previous period?



:hen revaluation is performed in actual costing for the previous period theprice control in the material master is changed from ! to $ and theperiodic price is updated as the valuation price for the previousperiod.

Q 1?7. What is the importance of the price determination indicator in the

material master for the purpose of actual costing run?

There are 2 price determination indicators in the material master hen material ledger is activated.

They are as follos-'

2 % transaction based) % !ingle level E multi level

*n case of material masters having price determination indicator 2 noactual costing ill ta+e place. *n case of material masters havingprice determination indicator ) actual costing ill ta+e place.

Q 1?/. What should #e the price control for a material master whichhas a price determination indicator 9 where material ledger isactivated?

*n such a case only price control ! is possible here the pricedetermination ) is activated in material master.

5I & What is the difference #etween PCA and CEPA as #oth are for

profita#ility reporting ?

C=' "CA is profit center accounting and C= "A is profitability analysis.The C=' "CA allos you to follo profitability at profit center level so itgives you an organiDational vie of financial performance. The C=' "A isfor profitability analysis at segment level so it gives you an analytic vieof the financial performance of a product or a segment mar+et.

5J What are the differences #etween Account #ased and Costing #ased

PA& What would you recommend to the client ?

Costing'based "rofitability Analysis is the form of profitability analysis that

groups costs and revenues according to value fields and costing'based

valuation approaches both of hich you can define yourself. *t

guarantees you access at all times to a complete short'term profitability

report.



Account'based "rofitability Analysis is a form of profitability analysisorganiDed in accounts and using an account'based valuation approach.The distinguishing characteristic of this form is its use of cost and revenueelements. *t provides you ith a profitability report that is permanentlyreconciled ith financial accounting.

Q 104 :hat is C and F form

This if Form issued by the consignee of goods to the consignor that thedeclaring that the goods stated are duty accounted for principle transfer his goods to the agent.

Form 61E62> This format of application for obtaining of document of titleto the goods during the movement from one another states

Form G> it is format of *ndemnity bond

Form F issued for stoc+Eranch transfer

Form :here an e,porter received an e,port order and for fulfill suchorder ma+es the purchase the goods under e,porter order than suchpurchase of such goods by the e,porter and sales of such goods madeby the selling dealer to e,porter are are all deemed to be in the courseof e,port of goods out of the territory of *ndia subHect to condition thate,porter issued certificate in Form to the selling dealer.

Form* *nter state sales made to a special 6conomic Done dealer to a

special under C!T act for the use by him in authoriDed operation in theunit !6J is e,empt from C!T Act dealer issued certificate form * toselling dealer

Form & As per C!T Act provides for granting e,emption on sales ta, of any goods made to any Govt official for development agent.

=#C- The function of =#C stand for configuration automatic postinghen the system setting are entered for inventory management andinvoice verification transaction the automatic posting GL Accounts."osting are made to Gl Accounts automatically in the case of invoice

verification and inventory management here are transaction arerelevant to financial and costing accounting

3ovement type 41 created for goods issued against sales order

Accounting entry

Cost of goods sold

*nventory of finished goods (@

To Cost of goods sold



Q 10 (ifference beteen the TAR*BB and TAR*B&

oth procedure TAR*B& and TAR*BB has thin line difference hereas TAR*BB

procedure is condition based K TAR*B& is formula based. *f you drag don

details of TAR*B& is fomula basedhere you can find @outine; selection ith

logic in line of condition type9 are play vital role in ta, calculation.

*f you selected TAR*BB procedure you can maintained ta, rate ith

respective condition types in FTR" during creation of ta, code. ut you

should maintain condition record in F$11 t.code for condition types &3R1 K

&3R2 are as 1N. Also you can maintain ta, rate for condition types Casic

6,cise (uty6du cess . 6du cess$ATEC!T in F$11 t.code in stead of

maintaining ta, rate in FTR".

The standard system comes ith to ta, calculation procedures. TAR*BB is

only supports condition' based e,cise determination hereas TAR*B&

supports condition'based e,cise determination and formula'based e,cise

determination.

oth ta, procedures contain condition types that cover all of the e,cise dutiesand sales ta,es applicable.

TAR*BB $s T AR*B&-

(efinition- condition'based e,cise deter mination

A method that the system uses of determining e,cise duty in *ndia. This methodre8uires you to create condition records for each combination of vendor or customer and material ;and possibly other conditions9.:hen you create apurchasing document the system calls the ta, procedure assigned to *ndia. Theta, procedure finds all of the condition records that you have created for thatcombination of vendor and material.

Q 10? :hen you create a sales document the e,cise duties and sales

ta,es are determined by the pricing procedure ;not the ta, procedure9.

(efinition- Formula'based e,cise deter mination A method that the system

uses of determining e,cise duty in *ndia. This method as used in the Country$ersion *ndia Add'=n and re8uires you to maintain additional data in the 6,cise@ate 3aintenance transaction &1*(.

:hen you create a purchasing document the system calls the ta, procedure

assigned to *ndia. 6ach of the e,cise duties in the ta, procedure has its on

condition types and each condition type is assigned to a formula. This formula

instructs the system to calculate the e,cise duty using the data that you have

maintained in the 6,cise @ate 3aintenance transaction.

:hen you create a sales document the system determines the e,cise duties



and sales ta,es using the pricing procedure ;not the ta, procedure9.

!ince the e,act rates of e,cise duty can vary on a large number of factors such

as hich vendor you purchase a material from or hich chapter *( the vendor

stoc+s the material under you create condition records for every sort of e,cise

duty.

:hen you come to enter a purchasing document the system applies the

e,cise duty at the rates you have entered in the condition r ecor ds.

(ifference beteen the Leading and non'ledger in sap

The leading ledger is based on the same accounting principle as that of theconsolidated financial statements leading ledger is parent ledger hich meansparent company. Leading ledger * primary ledger and non'ledger is secondaryledger in sap. @eporting done by the company to its company under leadingledger. *f you use the account approach for parallel accounting you post all data

to the leading ledge. This leading ledger is integrated ith all subsidiary ledgersand is updated in all company codes. This means that it is automaticallyassigned to all company codes. n each company code the leading ledger receives e,actly the same settings that apply to that company code- thecurrencies the fiscal year variant and the variant of the posting periods

@eporting to other countries come under non'leading ledger.

For every company has there is one leading ledger but Bon'ledgering has B

The currency leading ledger alays used 1st currency. :here as 2nd and )rd

currency of non'ledger ledger. Leading ledger base ledger hich update the cost

center and consolidation. Leading ledger integrated ith sub'sidiary Ledger

Q (ifference beteen the profit center and cost center

The main criteria of "CA is to determine main profit for internal area of responsibility and every profit center is assigned to the =@G unit controllingarea. "rofit center created product ise group or individual product.

Cost center accounting provides information on the cost incurred by your

business and CCA created for the functional area such as 3ar+eting Financeand @ etc.

"CA is =@G unit hich has generate both revenue as ell as e,penses.

Q (ifference beteen the Assessment and (istrubtion

(istribution uses the original cost element for allotting cost to the sender cost.Than receiving cost center e can see the original Ucost element from thesender cost element. (istribution allotting primary cost element.

Assessment use assessment the cost element Bo7) defined above to allotting

cost. Than various cost are summariDed under a single assessment cost center



in receiver cost center the original cost brea+ up from sender

Assessment can distributed primary as ell as secondary cost element

Q :hat Activity type

Activity type helps the system to understand the nature of the Activity carried

out in the particular cost center in a company. 6,p- Cutting polishing painting

:hat is statistical +ey figure

!IF are used as the basis i.e Trac+ing factors on hich to ma+e allocating i.e(istribution and Assessment

GA" Analysis

GA" is the additional feature hich are not available in !A" standard systemi.e. particularly customiDation may not be available in the !A" standard system

and same e have to corporate additional feature in !A". *dentify this type of scenario is GA" analysis

$aluation class %33 and Accounting 6ntry

Any transaction in 33 ith the respects of material movement happen ith themovement type. 6ach movement such as goods receipts against " = goodsissued to production. !carping of goods transfer of goods *ssued for sales*nitial stoc+ upload has a movement type defined in the system.

Thus various account assignment are li+ed to an are 33 movement type. *n theaccounting point material master updated the valuation class. 6ach 3aterial

type have determined the Gl Accounts codes for stoc+ Accounts.

$aluation Control

For Accounting determination group valuation control are by activity thegrouping valuation code. This ma+e the configuration of automatic postinggroup code Activity is necessary.

$aluation area to valuation group code

This valuation group code ma+e easier to a automatic posting system. The li+ebeteen valuation class and material type is set'up via the account categoryreference. @e8uirementC=A$aluation classTransaction IeyGroup valuation codeGL AccountGeneral modification

3ovement type 241 is for issue for the production order.

:hat are the registers in C*B.

/%cise 0egisters7 .



@G2)A "art *- ' "art * shos the 8uantities of the *nput 3aterials.

@G2)C "art *- ' "art * shos the 8uantities of the Capital Goods.

@G2)A "art **- ' "art ** shos the amounts of e,cise duty on the 3aterials and

ho such you have transferred to the C6B$AT accounts.

@G2)C "art **- ' "art ** shos the amounts of e,cise duty on the Capital Goods

and ho much you have transferred to the C6B$AT accounts.

Bote- ' "reviously manufacturers ere re8uired to +eep to separate registers

@G 2)A and @G 2)C for ra materials and capital goods respectively. This is no

longer the case but the distinction still remains in the system.

"LA- ' "ersonal Ledger Account

@G2)(- ' A record of receipts and issues of e,cisable materials as +ept by

depots.

@G1- ' A register of e,cisable finished goods +ept by manufacturing plants.

6@ 1- ' The Government of *ndia vide Botification Bo 24E2/'Central 6,cise

;B.T.9 prescribed the form 6.@.'1 to be filled ith e,cise authorities by all the

assessees ;as defined under Central 6,cise Act9 on a monthly basis for

production and removal of goods and other relevant particulars and C6B$AT

credit.

Bote- ' Bo 6@ 1 fulfills re8uirement of @T'12 i.e. 3onthly @eturn hich is to be

submitted to 6,cise Authorities every month end.

onthly 0eports7 .

&1* ' Query 6,cise invoices ;6,cise Transaction (etails9



&2*4 ' "rint 5tility ;"rintout of @G2)A "art * K ** @G2)C "art * K ** @G1 "LA

@T'12 etc...9

&2*0 ' Be 3onthly @eturns @eport @ule /A6 ;Anne,ure ' R9

&2*6@1 ' 3onthly 6@1 report

System 0e$uirements to perform /%cise 2ransactions

All statutory 6,cise details of the plant li+e

6CC Bumber

6,cise @egistration Bumber

6,cise @ange

6,cise (ivision

6,cise Commissionerate

Central !ales Ta, Bumber

Local !ales Ta, Bumber

"ermanent Account Bumber

!ervice Ta, @egistration Bo etcu224

. Company Code !ettings for 6,cise

C. "lant !ettings for 6,cise

(. 6,cise Groups creation and necessary configuration

6. !eries Groups creation and necessary configuration

F. Becessary changes in Ta, "rocedure and "ricing "rocedures for calculation

6,cise (uties li+e asic 6,cise (uty 6ducation Cess !econdary 6ducation

Cess $AT C!T etcu224

G. 3aintenance of ne Ta, Codes for 6,cise (uty conditions and calculation

. 3aintenance of Forms li+e u21CCu21( Form u21Cu21( Form

etcu224



*. 6,cise Account (etermination for proper posting of 6,cise (uties at the time of

different Transactions li+e 6,cise Credit 6ntry at the time Goods @eceipt 6,cise

*nvoice creation in !ales 3onthly 5tiliDation 6,cise &$s etcu224

&. Classification of 3ovement Types hich are involved during 6,cise

Transactions

I. @e8uired settings for different types of 6,ports li+e 6,port under ond

(eemed 6,port 6,port under rebate etcu224 !ettings of A@6'1 A@6')

procedures settings for different license types li+e CT'1 CT') etcu224

L. (evelopment of FormsE Layouts for 6,cise @egisters li+e @G2)A @G2)C

@G2)( @G1 "LA @T'12 etcu224

3. 3aintenance of Bumber ranges for 6,cise obHects li+e @G2)A "art *K**

@G2)C "art *K** 6,cise *nvoice Bo. ranges for Local and 6,port !ales /F7

Challan Bo. @anges etcu224

3. 3aintenance of 6,cise 3asters li+e

Chapter *(s

3aterial K Chapter *( Combination

3aterial Assessable $alue

C6B$AT (etermination

$endor 6,cise (etails

Customer 6,cise (etails

!!* @ates for !!* $endors

6,cise Ta, @ates

/%cise 2ransactions7 .

*ncoming 6,cise *nvoice entries

For *ndigenous 3aterials ;@a 3aterials9

For *mported 3aterials ;ill of 6ntry9

For Capital Goods

(epot 6,cise



Creation and maintenance of /F7 Challans for !ubcontracting "rocess

!ubcontracting ithout "ayment of (uty

Creation of !ubcontracting Challan

@efer !ubcontracting Challan at the time of G@

@econciliation of !ubcontracting Challan

Completion of !ubcontracting Challan

Generation of Anne,ure *$

!ubcontracting under Full "ayment of (uty

Creation of 6,cise *nvoice .r.t. Transfer "osting (ocument

Capture 6,cise *nvoice at the time of G@ of Finished Goods

"ost 6,cise *nvoice

C. =utgoing 6,cise *nvoices

For (omestic !ales

For 6,port !ales

6,port under ond ;A@6'19

(eemed 6,port ;A@6')9

6,port under @ebate

For $endor @eturn

(epot 6,cise *nvoice

(. 3onthly utiliDation

6. 6,cise &$ ;C6B$AT AdHustment "ostings9- '

F 3aterial :rite'off

3aterial Bon'"roduction

Additional 6,cise

=ther AdHustment

T@4 Challan



6,cise Cancellation

F. "rinting of 6,cise *nvoices A@6'1 A@6') (ocuments etcu224 ith

necessary e,cise details.

o *mport procurement cycle or+

C*n *ntervie 8uestion

:hat are the settings involved to run the stoc+ transport orders through the

G@"= routeS

o do * configure the system for partial credit functionalityS for eg. ?-2 or

0/-/ for Cenvatable- *nventorisable

:hat is the difference beteen the u21?(epotu210 indicator at the plant and

the same at the e,cise group levelS

Can * change the non'cenvatable condition types that have been deliveredS

Can * segregate different actions and reference documents combinations for

incoming e,cise invoice transaction ;&1*6R9S

*n the !ubcontracting ChallanS

o is the u21CG@s per 6* settingu21( decidedS

:hat is 6:"=S :hen do you use itS

:hat needs to be done if the 6,cise *nvoice 8uantity is not e8ual to G@

8uantityS

:hat should be my accounting entry hen the goods are issued through 33

and e,cise invoice is created ;&1*! K &1*$9S

:hen * create an e,cise invoice for e,ports hat e,change rate ill the system

ta+eS



what is withholding ta%? when we use withholding ta%? what are theprocedure in steps for calculating 2(S

:ithholding ta, means to calculate in ta, on payments only. *n *ndia ithholdingta, is ta+en for the T(! sections 107C107&107* and soon.

Chec+ ithholding ta, countries

(efine ithholding ta, type for invoice posting

(efine ithholding ta, type for payment posting

(efine ithholding ta, codes

Formulas for calculating ithholding

Assign ithholding ta, type to company codes

Activate ithholding ta,

create GL account and Automatic postings

Assigning :Eta, types to vendor master

:hat is "rofit and Loss and alance sheetalance sheet is 8uantity of summary of company Financial !tatement atspecific point of time including Assets and Liabilities and Bet orth

The first balance sheet sho the all productive assets and second part shothe Liabilities and share holders

"rofit and Loss statement summaries the @evenue Cost and 6,penses during

the particular point of time

S A" proHect organisation structure and its effectiveness plays a crucial role than

you can imagine in achieving your proHect goals. * ill share my perspectives on

ho a !A" proHect organisation should be setup that can ma,imiDe your

chances of a successful go'live. :hat * ill not do is discuss responsibilities of

each role covered belo but discuss more on hat measures or 8ualities you

should be loo+ing to fill these roles for your proHect. Actual organisation structure

can slightly vary depending on the siDe and comple,ity of your !A"

implementation. Lets ta+e a pee+ at ho * ould li+e to see a proHect org setup.



#ou are elcome to send me an email if you have any feedbac+ or need advice

specific to your proHect

6,ecutive !ponsor

6,ecutive !ponsor ;or "roHect !ponsor9 is a senior e,ecutive of your company

that is chosen to chair the !A" proHect. 6,ecutive !ponsor is responsible for the

heading all aspects of your proHect including budget timeline and approval of

delivery of deliverables for your proHect. This individual is also responsible for

providing insight into proHect progress along ith maHor issues ith alternatives

to the e,ecutive steering committee.

* recommend that the 6,ecutive !ponsor be at least be of the level of $ice

"resident or higher hich ill allo this individual to navigate easily through your

organisation to see+ resolution to critical proHect issues. !cheduling meetings

ith other e,ecutives ithin your company and also getting them to 8uic+ ma+e

decisions can get dragged if this role does not have ade8uate authority hichusually come ith the title.

Advisory Services !A K Eversight" for SAP Proect

*magine having an independent leader and e,ecutive in your !A" "roHect

Leadership ho can influence and champion your company through the entire

implementation life cycle of your !A" proHect. =ne individual is all you need to

+eep a chec+ on your systems integrator and or+ directly ith companye,ecutives to address all !A" program challenges and ris+s ithout interference

of your corporate culture. *f you thin+ this role ould an ideal fit to your proHect

then you have reached the right place. :ith our SAP Advisory Services e

engage a dedicated "roHect Advisor on your proHect to manage your proHect ris+s

and provide independent advice to your entire team. :ith an e,tensive !A"

proHect management and delivery e,pertise a SAP Proect Advisor ill provide

a comprehensive oversight to your proHect in proactively avoiding and managing

challenges hich could turn into maHor implementation issues.

This role or+s closely ith the proHect leadership to provide end'to'end advisory

leadership to the proHect hile overseeing all aspects of program management

governance change control and e,ecution. This role complements your e,isting

!A" "roHect Leadership and you need not ma+e any changes to your current

!A" proHect leadership. :e ill or+ ith the !ystems *ntegrator as ell as !A"

America Vas !oftare $endorW in ensuring the success of your proHect.

=ur !A" Advisory !ervice is unli+e any other service from maHor !A" systems

integrator because each of our !A" "roHect Advisor has in'depth !A"

implementation e,perience in proHect management e,ecution technical

implementation and overall program governance. Typically you see !A" proHect

and program management leaders ho have e,pertise in proHect management

and governance. !ou "ill #e surprised "ith the level of e$pertise of our %&P

Pro'ect &dvisor in all pro'ect "orkstreams including %&P functional, technical



architecture, &(&P, (I, PI, (&%I% and %olution Manager) =ur e,pertise in all

!A" implementation or+ streams along ith program management and

e,ecution is the incredible ealth e bring to your proHect hich no other !* or

management consulting firm can offer.

aving a ell 8ualified !A" "roHect Advisor could tremendously benefit your

!A" implementation to ensure that it gets bac+ on trac+ in a 8uic+ and effective

manner to meet your proHect timeline and goals. :e recommend that you shouldconsider addition of a !A" "roHect Advisor to your proHect leadership in the

folloing situations.

#our proHect is running behind schedule or e,ceeding budget in e,cess of 1/N.

#our systems integrator is continuosly missing proHect milestones or modifying

the list of deliverables due at each milestones there by puting the proHect at ris+.

#our proHect scope is fre8uently adHusted to meet budget and timeline.

#ou believe that your !A" systems integrator leadership or implementation teamis under'8ualified and lac+s a industry specific e,perience.

#our proHect team feels that solution designed and built by the !* may impose

significant ris+s to your business upon go'live. This may arise if the 8uality of

solution is poor or integrated system may not or+ as per design.

#ou have a fi,ed fee implementation and need thorough chec+ of deliverables

produced by your !A" systems integrator.

#our are about to start a ne !A" proHect and ould li+e to proactively use !A"

implementation best practices to reduce the ris+s of failure.

!A" Trusted Advisor 6ngagement 3odel

!A" Trusted Advisor is one dedicated e,ecutive leader on your !A" program

or+ing directly ith the C*= or the e,ecutive proHect sponsor and your steering

committee. @esponsibilities at a macro level is to manage the e,ecution and

delivery of your !A" program hile reducing ris+s associated ith budget

overrun slipping milestones poor technical systems implementation and further

ma,imiDing your retun on investment in !A".

*n general activities of this role may vary ith each !A" customer depending

on the time at hich you decide to engage ith a proHect advisor. oever most

of the tas+s are generated on'the'fly to meet the demand and overcome any

challenges on a specific !A" proHect. !ome of the +ey tas+s that an !A" "roHect

Advisor from our company ould primarily focus are outlined belo. C*= and

e,ecutive leadership may have some specific additional aspects that ould ant

this role to address in addition to the responsibilities mentioned belo.

"roHect "lanning K Iic+'off "hase Advise on setup of your internal proHect leadership and overall organiDation

structure.



AnalyDe business case high level business re8uirements and future groth plan

ith the +ey sta+eholders

"rioritiDe goals of your !A" program and see+ leadership K steering committee

alignment

=versee and advice on selection of !A" pac+ages to meet your business

needs and budget

6stablish selection process and evaluation criteria for !A" !ystems *ntegrator

; also +non as !* or !A" implementation partner or !A" vendor9

*nvite @F" and bids from all prospective vendors. 6valuate vendor proposals

demos technical capabilities and intervie +ey leadership roles to 8ualify the

bids.

Begotiation of bids ith shortlisted vendors

@evie capital and e,pense spending per fiscal year of the !A" program. AdHustproHect timeline and staffing model to meet any corporate budget restrictions.

!elect the !ystems *ntegrator for the proHect by or+ing closely ith the C*=

steering committee and the e,ecutive leadership

!elect proHect engagement model by or+ing ith C*= e,ecutive leadership and

systems integrator.

"reparation of first !tatement of :or+ ;!=:9 for proHect planning E preparation

phase

*ntervie and select the initial vendor leadership roles including senior

e,ecutives ; or partners9 delivery lead proHect manager technology manager E

lead and other +ey leaders that ill Hoin the proHect during the planning phase

@evie proHect or+plan proHect charters "3= tools K reporting e,ecution

methodology staffing model ;for each phase9 and or+ effort estimations.

@evie blueprint or+shop schedule participation matri, timeline and 8uality

gates Continuous 6ngagement ith $endor Leadersip and *nternal "roHect

Leaders

:or+ closely ith !* senior e,ecutive ;partner E delivery leader9 to discuss

avenues of improvements in proHect e,ecution faster proHect delivery resource

challenges solution optimiDation and scoping issues.

@evie ris+s associated ith proHect delivery budget overrun solution 8uality

and Q'gates ith vendor e,ecutives and propose mitigation plan.

=versee and advice the periodic ;daily or ee+ly9 proHect leadership meeting.

6nsure accurate proHect progress is reported and discussed. Advice on options

to mitigate any +non proHect ris+s or issues.



3anage disagreements or conflicts beteen business teams internal

leaderships and systems integrator. !erve as an independent unbiased advisor

to resolve these conflicts and +eep the entire proHect team motivated throughout.

!ee+ on'demand assistance from e,ternal business or third party e,perts hen

needed. At times proHect may need assistance from !A" America E !A" AG to

evaluate and resolve fe !A" technology hurdles.

6valuate and 8ualify proHect progress report for preparing periodic Xsteering

committee presentationX and or+ ith the proHect leadership in preparing this

presentation. "rovide e,pert opinion and advice to the !teering Committee hen

needed.

lueprint VAnalysis K @e8uirements GatheringW

=versee the e,ecution 8uality and progress of business re8uirements gathering

phase. :or+ ith the delivery lead and proHect managers to trac+ deliverable

completion as planned.

@evie "( ;usiness "rocess @e8uirements K (esign or "@(9 documents

for 8uality and ensure that business team leads and !36;s9 have signed off on

all "( documents.

@evie overall fit gap analysis and @*C6F inventory.

=versight to change control board meetings throughout the duration of proHect

and advice ;also approve or decline9 any change re8uests based on bestpractices together ith leadership alignment. Avoid e,cessive change re8uests

that may present ris+ to proHect delivery and budget.

6nsure that all sign'off and deliverable approval procedures are folloed

throughout the proHect organiDation.

$erify setup and proHect readiness of !A" !olution 3anager

@ealiDation V (esign E uild E TestW

• @evie or+ plans for all streams "3= =C3 business teams integration

legacy business intelligence systems architecture E *T infrastructure @*C6F

development and implementation.

• *ntervie all vendor ;!*9 e,ternal and ne hire resources for the proHect. (efine

evaluation procedures and selection matri, for other individual team resource

selection hich may be delegated to team leads. =versee and adHust proHect

teams based on individual team or proHect performance.

• @evie overall solution design and application architecture.

• @evie selected functional and technical design documents to ensure high

8uality. This documents should include configuration rationale @*C6F ;or

F@*C69 specifications architecture diagrams etc.



• 6nsure best practices are folloed in 5* designs AA" coding standards

application architecture !=A enablement etc.

• @evie proHect estimations progress matri, issueEris+s management and other

processes managed by the "3=. 6nsure that "3= and delivery leaders are

managing ell to resolve any proHect level ris+s E issues and maintaining

progress as per plan.

• Conduct random spot chec+ of system implementation in development and QA

!A" environments. !pot chec+s may include but not limited to code revie *3G

setup transport re8uests revie ;may include CA@39 !olution 3anager

setup etc.

• @evie unit test product test integration and assembly test progress. 6nsure

proper testing and solution E build approval procedures are folloed by business

and *T teams.

• @evie transport strategy business migration strategy disaster recoveryE

business continuity strategy and training plan

• $erify configuration and usage of !A" !olution 3anager

(eployment K Go'Live

=versee all systems deployment and business migration activities

6nsure speedy resolution to issues in production system

=versee and advise on any cutover challenges

6nsure smooth operation of XCenter of 6,cellenceX and production support

teams =versee smooth transition of the !A" system to business users

(efine and e,ecute !A" system maintenance contract and !LA ith the vendor.

2a% Collected at Source

This is a form of ta, in *ndia hich is collected at source from the buyer by the

seller of prescribed items. *t is commonly referred to as TC!. The systemautomatically calculates the ta, collected at source and ma+es the relevant

postings in Financial &ccounting ;F*9 and %ales and *istri#ution ;!(9.

"rere8uisites

#ou have-

3ade settings as described in CustomiDing for Ta, Collected at !ource

6ntered the TC! ithholding ta, type and ithholding ta, code and selected

the +ta$ chec+bo, in the customer master.

http://help.sap.com/erp2005_ehp_04/helpdata/en/49/dd8b8577a471cee10000000a421944/content.htm

http://help.sap.com/erp2005_ehp_04/helpdata/en/ef/1b7d59f528432680c600ad083fbf18/content.htm

http://help.sap.com/erp2005_ehp_04/helpdata/en/ef/1b7d59f528432680c600ad083fbf18/content.htm

http://help.sap.com/erp2005_ehp_04/helpdata/en/49/dd8b8577a471cee10000000a421944/content.htm



Features

Ta, Collected at !ource has the folloing features-

The rate of ta, collected at source differs based on the type of commodity.

The 6ducation Cess and the !econdary and igher 6ducation Cess are

applicable at a certain percentage on the ta, collected at source.

The seller of the items should furnish a ta, certificate specifying hether ta, has

been collected the amount that has been collected rate of ta, applied and such

other particulars as may be prescribed.

#ou post the ta, collected at source by creating-

A sales order using the -reate %ales .rder ;$A19 transaction.

An outbound delivery using the -reate In#ound *elivery ;$L19 or the -reate

In#ound *elivery "ith .rder Reference ;$L1B9 transactions. A billing document

using the -reate (illing *ocument ;$F19 transaction.

/%ample

Consider an invoice for goods of *B@ 1 and TC! of 1N. The goods buyer

pays the ta, collected at source. (uring the creation of billing document the

system ma+es the folloing postings-

Account (e#it !(r" Credit !Cr"

Customer AEc (r 11

!ales AEc Cr 1

TC! payable Cr 1

*n F*C= side !tep % 1 Create the official :T +eys

!1 % For TC!!2 % TC! surcharges!) ' 6( Cess!7 6( Cess



ase amount % 3odify net amount@ound @ule % @ound the ta,!elect post :ETa,- Amount chec+ o,

Accumulation type- Bo Accumulation

Documents

Fico - Interview updated.docx