SAP University - Financial Accounting

1. © SAP AG
Phase I: Financial Accounting
SAP University Alliances
Version 2.2
Authors Simha Magal
Stefan Weidner
Tom Wilder
Product
SAP ERP 6.0 EhP4
Global Bike Inc.
Level
Beginner
Focus
Configuration: Financial
Accounting

2. Configuration
Page 2
© SAP AG
Agenda
 Enterprise Structure
 Business rules and parameters
 Master data
 Process execution (testing)
 Exercises

3. Configuration
Page 3
© SAP AG
Enterprise Structure
 Enterprise structure elements
- Client
- Financial accounting
• Company code
• Business area
- Management accounting
• Operating concern
• Controlling area
- Fulfillment
• Credit control area
 Define / Maintain
- Including some parameters
 Assign

4. Configuration
Page 4
© SAP AG
Enterprise Structure
SD, MM, PP,
etc.
FI
CO-PCA, CO-
OM, CO-PC
CO-PA Operating
Concern
Controlling
Area
Company
Code
S-Org P-
Org Plant,
etc.
S-Org P-
Org Plant,
etc.
Company
Code
Controlling
Area

5. Configuration
Page 5
© SAP AG
Company Code
 Used to represent a legal entity
 Key organizational level for financial accounting
- Books are maintained at the company code level
- Financial statements are generated for company codes

6. Configuration
Page 6
© SAP AG
Company Code
 Buick
 Cadillac
 Chevrolet
 GMC
 Shanghai GM
 One for each legal entity  One for each country
 GBI USA
 GBI Germany
 GBI Australia

7. Configuration
Page 7
© SAP AG
Business Area
 Internal divisions of the enterprise
- Define areas of responsibility
 Financial statements are generated for business areas

8. Configuration
Page 8
© SAP AG
Operating Concern & Controlling Area
Company
Code
Controlling
Area
Operating
Concern GL00
NA00
US00
NA##
US##
 Operating Concern:
- Relevant to profitability analysis
- Represents external market
segments
- Several controlling areas can be
assigned to operating concerns
 Controlling Area
- Organizational level in controlling
- Costs are allocated within a
controlling area
- Several company codes can be
assigned to a controlling area

9. Configuration
Page 9
© SAP AG
Credit Control Area
 Responsible for customer
credit
 Centralized
- Once CCA for the
enterprise
 Decentralized
- Multiple CCA for the
enterprise
- Example: North
America, Europe, Asia
Company Code
Credit Control
Area
Enterprise GBI
GL00
US00 DE00
GL##
US## DE##

10. Configuration
Page 10
© SAP AG
Agenda
  Enterprise Structure
 Business rules and parameters
 Master data
 Process execution (testing)
 Exercises

11. Configuration
Page 11
© SAP AG
Business Rules and Parameters
 Global parameters (for CC)
 Account groups
 Field status variants
 Posting periods
 Number ranges
 Tolerance groups

12. Configuration
Page 12
© SAP AG
Business Rules and Parameters
 Define field status
 Field status variants
- ZEXP: Expense accounts
- ZGBS: General Balance
Sheet Accounts
- ZMMA: Material Management
GR/IR Accounts
- ZRAA: Reconciliation
Accounts
- ZREV: Revenue Accounts
 Demo
- Field status variants
- Note: FI global settings-
>Ledgers->Fields
 Global parameters (for CC)
- Chart of accounts
- Credit control area
- Fiscal year variant
• Define accounting fiscal
year
• Create normal posting
periods
• Create special periods for
adjustments
 Account Groups
- Groups accounts with similar
characteristics

13. Configuration
Page 13
© SAP AG
Business Rules and Parameters
 Posting Periods
- Define periods
- Assign periods to CC
- Close past periods
 Document number ranges
- For various documents
 Tolerance groups for employees
- Posting limits

14. Configuration
Page 14
© SAP AG
Agenda
  Enterprise Structure
  Business rules and parameters
 Master data
 Process execution (testing)
 Exercises

15. Configuration
Page 15
© SAP AG
Master Data
 Chart of accounts
 General ledger accounts
 Subsidiary (sub)ledgers
 Cost elements
 Cost centers
 Statistical key figures

16. Configuration
Page 16
© SAP AG
Chart of Accounts
 An orderly definition of accounts in the general ledger
 Three types of chart of accounts:
- Operative COA
- Country-specific COA
- Group COA
 Multiple charts of accounts exist
- US (CAUS) , Germany (GKR), Canada (CANA)
• Country specific to meet reporting requirements
- International Chart (INT)
• IFRS

17. Configuration
Page 17
© SAP AG
Chart of Accounts
 One COA can be used by
multiple company codes
- Different GM companies
(Buick, Cadillac, GMC) can
use the same (US) chart of
accounts
- Shanghai GM will use the
Chinese chart of accounts
 A company must use at least
one chart of account
- Can use more than one
chart of account to create
alternate ledgers

18. Configuration
Page 18
© SAP AG
General Ledger Accounts
 Used to record all accounting impact of business transactions
 Groups
- Retained earnings account
- Balance sheet accounts
- Income statement accounts
- Reconciliation accounts
 Data in the general ledger accounts are segmented by
organizational level
- Chart of account segment
- Company code segment
- General ledger = COA data + Company code data

19. Configuration
Page 19
© SAP AG
Master Data: General Ledger Accounts
Demo
• Show available chart of accounts
• Show examples of GL accounts
• Show segments of data

20. Configuration
Page 20
© SAP AG
Master Data: Sub-ledger and Reconciliation Accounts
Subsidiary Ledgers
 Are not part of the general
ledger.
 Used to separate accounting
for customers, vendors, and
assets
Reconciliation Accounts
 Are general ledger accounts
 Cannot be posted to directly
 Maintain the sum of the
postings in sub-ledgers
 Are specified in the definition
of the sub-ledger
Sub ledger
account
Reconciliation
account
Customer Accounts
Receivable
Vendor Accounts Payable
Asset (specific) Assets
Demo
• Show sub ledger accounts
• Show connection between sub ledger
and GL (Customer <--> AR)
• Show non-reconciliation AR and AP
accounts

21. Configuration
Page 21
© SAP AG
Master Data: Sub-ledger and Reconciliation Accounts

22. Configuration
Page 22
© SAP AG
Master Data: Cost Center
 Location where costs are
incurred
- Department, individuals,
special projects
- Examples
• Copy center
• Security department
• IT Help desk
 Cost bucket used to
accumulate costs
- Typically Overhead costs
• Payroll
• Rent
• utilities
 Responsible for cost
containment
 Accumulated costs are then
“charged” to other cost
centers
 Many processes have
“orders”
- Purchase orders, Production
orders, Sales orders
- Expenses can be charged to
these orders
 Collectively objects that can
absorb costs are called
controlling objects

23. Configuration
Page 23
© SAP AG
Master Data: Cost Center Hierarchy
Demo
• Cost center
hierarchy

24. Configuration
Page 24
© SAP AG
Cost Elements
Primary Cost Element
 Associated with expense
accounts in G/L
 All postings in the G/L expense
account are also
(automatically) posted in the
corresponding cost element
 Payroll, rent, utilities, etc
 Typically uses the same
number as G/L account
Secondary Cost Element
 Secondary cost elements are
defined only within CO and
do not have a corresponding
G/L account
 Used for internal cost
allocation among cost centers
 Example:
- Primary: Electricity, Gas,
Water
- Secondary: Utilities

25. Configuration
Page 25
© SAP AG
Posting in FI and CO
FI
CO
500
Supplies Expense
Debit Credit
500
NAAD1000:
Administrative
Costs
Debit Credit
500
Bank Account
PCE

26. Configuration
Page 26
© SAP AG
Master Data: Statistical Key Figures
 An allocation base for cost allocation between cost centers
 Measurable quantity
- Number of employees
- Square feet
- Miles driven
- Minutes of time (phone call)
 Used in periodic allocations and distributions (CO processes)

27. Configuration
Page 27
© SAP AG
Agenda
  Enterprise Structure
  Business rules and parameters
  Master data
 Process execution (testing)
 Exercises

28. Configuration
Page 28
© SAP AG
Process execution (Testing)
 Recording of value flows ($$) as a result of other processes and
transactions
- General Ledger Accounting
• G/L postings for rent, utilities, wages, etc.
- Accounts Payable Accounting
• Part of the procurement process
- Accounts Receivable Accounting
• Part of the fulfillment process
- Asset Accounting
• Acquisition, depreciation, retirement
 Processes are executed to test the configuration
- General Ledger Accounting in this Phase
- Other testing will occur in later phases

29. Configuration
Page 29
© SAP AG
Agenda
  Enterprise Structure
  Business rules and parameters
  Master data
  Process execution (testing)
 Exercises

30. Configuration
Page 30
© SAP AG
Exercises
 1.1 - Enterprise Structure
- Configure the enterprise structure
 1.2 - Business Rules and Parameters
- Define Business Rules and Parameters
 1.3 - Master Data
- Create needed master data (copy from 00 where possible)
 1.4 – Process Execution (Testing)
- Post several G/L transactions
 Appendices
- Exercises provide detailed instructions for one or few objects (e.g.,
once cost center, once vendor, etc.)
- Appendices provide data from additional objects (cost centers, etc.)
- Don’t forget them!!!!

31. Configuration
Page 31
© SAP AG
Exercises
Enterprise
Structure
Rules and
Parameters
Master Data
Process
Execution
I.1.1: Define Company Code 3
I.1.2: Define Business Area 5
I.1.3: Define Empty Chart of Accounts 6
I.1.4: Maintain Controlling Area 7
I.1.5: Define Credit Control Area 8
I.1.6: Define Variants for Open Posting Period 9
I.1.7: Define Field Status Variants 10
I.1.8: Enter Global Parameters 11
I.1.9: Assign Company Code to Controlling Area 12
I.1.10: Assign Controlling Area to Operating Concern 13
I.1.11: Define Standard Hierarchy 14
I.1.12: Assign Permitted Credit Control Areas 15
I.1.13: Maintain Company Code for Materials 16

32. Configuration
Page 32
© SAP AG
Exercises
I.1.1: Define Company Code
Description: In this task, you define your own company code in the United States. The company
code is the organizational unit that allows you to structure your enterprise from a financial
accounting perspective. A company code possesses information that is important for financial
accounting purposes. For example, each company code is assigned to exactly one country.
Warning: See “General Notes and Cautions” about table locks.
Navigation: SAP Customizing Implementation Guide ► Enterprise Structure ► Definition ► Financial
Accounting ► Edit, Copy, Delete, Check Company Code
In the “Choose Activity” pop-up, double-click on Edit Company Code Data.
Configuration Step
Explanation
Navigation

33. Configuration
Page 33
© SAP AG
Exercises
Tasks and Data Entry:
In the “Change View “Company Code”: Overview” screen, click on the icon.
In the “New Entries: Details of Added Entries” screen, enter the following information:
Attribute Description Data Value
Company Code An organizational unit within financial accounting. US##
Company Name Name of Company Code or Company ## Global Bike Inc.
City City name in an address. Dallas
Country The country key contains information which the
system uses to check entries such as length of the
postal code or bank account number.
United States
Currency Currency key for amounts in the system. United States Dollar
Language The language key designates the language in which
you display texts, enter texts, or print documents.
English
Tasks and Data Entry
Enter value as
specified
(except for ##)
e.g.: US05, Dallas
Find and enter
appropriate
Code/Value
e.g.: US, USD, EN

34. Configuration
Page 34
© SAP AG
Exercises
 A note about ## vs. ###
- User IDs have three digits at the end: GBI-###
- Configuration can only have 99 users : 01, 02…..99
- Exercises reference ##.
- Substitute the last two digits from their UserID
- User GBI-034 will use 34
 Examples
- Controlling area (North America: NA## -> NA34)
- Company code (US company: US## -> US34)
- Business area (Bicycles: BI## -> BI34)
- Credit control area (Global: GL## -> GL34)
- Exception: Operating concern (GL00 for everyone)
• Technical reason for not using GL##
• Operating concern is a cross client change

35. Configuration
Page 35
© SAP AG
Exercises
 Two versions
- Student version
- Instructor version
• Includes screenshots
• Notes (need to add more; you can help!)
• Cautions and warnings (need to add more; you can help!)
• Don’t give these to students

36. Configuration
Page 36
© SAP AG
Agenda
  Enterprise Structure
  Business rules and parameters
  Master data
  Process execution (testing)
  Exercises