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Tuesday, December 13, 2011

Document structure/ control

1) A document is saved for every posting. Every Document is uniquely identified by the Document Number, Company Code and Fiscal Year.

2) A Document contains Document header + 2 to 999 line items.

3) Document Type : Controls the Document header and classify the business transactions to be posted.

>> Posting Key : Controls the Line items.

4) Document types are defined at client level. Document types define the following:

a) Number ranges for Document number.

b) Account types permitted for postings. And also

c) The field status of “document header Text” and “Reference number” in the Document header.

d) Whether the invoices are posted with net procedure.

5) Standard Document types are :

KR – Vendor Invoice DR – Customer Invoice.

KG – Vendor Cr.Memo. DG – Customer Cr.Memo.

KZ – Vendor Payment DZ – Customer Payment.

AB – General Document SA – G/L a/c posting.

6) Document numbers can have internal or external number assignment.

7) Up to a future fiscal year – Number range will continue irrespective of year end.

For each fiscal year – At the start of a new year the system starts the number assignment again at the start of the number range. (You need to define number range for every new fiscal year)

8) The document number range must not over lap.

9) Document type AB allows postings to all account types.

10) One number range can be assigned to several document types.

11) Posting keys are defined at client level.

12) Posting keys control:

i) On which type of account the line item can be posted to

ii) The item is posted as a Debit or Credit.?

iii) The field status of additional fields.

In addition to this posting key specifies the following:

>> Whether line item is connected to payment transaction or not.

>> Whether posting is sales relevant.


13) Document line item fields are controlled by :

a) G/L Account specific field status group assigned to the G/L account while creating. (Account specific field status groups are summarized under field status variant which is assigned to company code) If the document is posted to a sub ledger a/c, the field status group of the reconciliation a/c is used.

b) Posting key specific field status group.

(The field status HIDE cannot be combined with the field status REQUIRED entry which causes an error.)

14) Document type does not have default posting key or vise versa. For each FI transaction (E.g. Invoice, Credit memo, Out going payment) you can define a document type and default posting key at:


IMG:FI A/cing>F.A.Global Settings>Document>Default values for document processing>Default values.

(E.g. When posting outgoing invoices, you use the document type "DR" and

posting key "01". You can store these specifications in the system. They

are proposed by the system when you call up the corresponding

transaction).

General Ledger Master Records

1) There are 3 steps to create and use a chart of accounts (COA)
a) Define COA
b) Define the properties of the COA
c) Assign the COA to Company codes.

2) The COAs is a variant that contains the structure and the basic information about general ledger accounts.

3) The Definition of COA contains
a) Four digit COA key.
b) COA Name.
c) Maintenance language,
d) Length of the G/L Account number.
e) Integration with Controlling (CO) – Manual/Auto creation of Cost Elements.
f) Group Chart of accounts.
g) Status – Block indicator.

4) Length of G/L accounts can be from 1 to 10 digits.

5) One COA can be assigned to several company codes.

6) GL Master contains COA segment and Company code segment.

7) The Information entered in the COA segment for a G/L account applies to all company codes using that COA.

8) The Chart of account segment contains following details:
i) Type/Description - Account group.
- P/L or Balance sheet item.
- Description – Short/Long text.
- Group Chart of Account G/L. no.
ii) Key word Translation. – Key words in COA
- Translation.
iii) Information - Info in COAs
- G/L text in COA.s

9) The Company code segment of G/L master contains:
Only bal in
a. Control Data. – Account Control local currency, Exchange rate diff, Tax Category.A/c Management in Company code.- Open/Line item management,
b. Bank interest
c. Information.

10) Account Group Controls - Number ranges of the account.
- Status of fields in the company code segment of the master record.

11) Field status has following properties - Hide. 
- Display.
- Required entry.
- Optional entry.

12) Fields displayed in G/L account master record are controlled by:

a. Account group
b. Transaction specific controls (Create/Change/Display).

13) Field status group assigned to a G/L codes in Company code segment is to control the field status of the financial transaction entered in that G/L account.

14) While creating Reconciliation account G/L master Reconciliation a/c type needs to be assigned – i.e. D – Accounts receivable or K – Accounts payable

15) You cannot post amounts directly to reconciliation accounts.

16) You can only activate or deactivate open item management if the account has a zero balance.

17) If the account currency is the local currency – the account can be posted to in any currency.

18) Account in Foreign currency as account currency can only be posted to in that foreign currency.

19) The group chart of account is assigned to each operational chat of accounts. If this is done “Group account number” in COA segment of the Operational COAs is a required entry field.

20) Country COA/Alternative COA number is entered in company code segment. This makes alternative G/L a/c field in Company code segment of the G/L master record a required entry.

21) Different accounts of one operational COAs can refer to the same group g/l account. However one country chart of a/c GL code can be referred to only one operational GL a/c. Every country chart of accounts number can only be used once.

22) If all the companies are using the same operational COA then consolidation is possible otherwise Group COA is used for Consolidation.

23) G/L accounts with open line item management must have line item display activated.

24) GL account number ranges are always external where as for customer/vendor it can be internal as well as external number assignment.

25) For Cross company code controlling, companies must use the same chart of a/cs.

26) Number intervals for G/L account master data can overlap.

27) The fields “Account currency” and “Field status Group” are always required entry fields. This status cannot be changed.

28) Reconciliation accounts are general ledger accounts assigned to the business partner master data to record all transactions in the sub ledger.

IMG: Financial A/cing>G/L A/cing>Master records>Preparations >Additional Activities>Define screen layout for each transaction 9Create/Change/Delete)

Finance Terminology


Client: In commercial, organizational and technical terms, a self-contained unit in an R/3 System with separate master records and its own set of tables.
Company Code: The smallest organizational unit of Financial Accounting for which a complete self-contained set of accounts can be drawn up for purposes of external reporting.
Business Area: An organizational unit of financial accounting that represents a separate area of operations or responsibilities within an organization and to which value changes recorded in Financial Accounting can be allocated.
Enterprise structure: A portrayal of an enterprise's hierarchy. Logical enterprise structure, including the organizational units required to manage the SAP System such as plant or cost center.
Social enterprise structure, description of the way in which an enterprise is organized, in divisions or user departments. The HR application component portrays the social structure of an enterprise
fiscal year variant: A variant defining the relationship between the calendar and fiscal year. The fiscal year variant specifies the number of periods and special periods in a fiscal year and how the SAP System is to determine the assigned posting periods.
Fiscal Year: A period of usually 12 months, for which the company produces financial statements and takes inventory.
Annual displacement/Year shift: For the individual posting periods various entries may be necessary. For example, in the first six periods the fiscal year and calendar year may coincide, whereas for the remaining periods there may be a displacement of +1.
Chart of Accounts: Systematically organized list of all the G/L account master records that are required in a company codes. The COA contains the account number, the account name and control information for G/L account master record.
Financial statement version: A hierarchical positioning of G/L accounts. This positioning can be based on specific legal requirements for creating financial statements. It can also be a self-defined order.
Account group: An object that attributes that determine the creation of master records. The account group determines: The data that is relevant for the master record A number range from which numbers are selected for the master records.
Field status group: Field status groups control the additional account assignments and other fields that can be posted at the line item level for a G/L account.
Posting Key: A two-digit numerical key that determines the way line items are posted. This key determines several factors including the: Account type, Type of posting (debit or credit),Layout of entry screens .
Open item management: A stipulation that the items in an account must be used to clear other line items in the same account. Items must balance out to zero before they can be cleared. The account balance is therefore always equal to the sum of the open items.
Clearing: A procedure by which the open items belonging to one or more accounts are indicated as cleared (paid).
Reconciliation account: A G/L account, to which transactions in the subsidiary ledgers (such as in the customer, vendor or assets areas) are updated automatically.
Special G/L indicator: An indicator that identifies a special G/L transaction. Special G/L transactions include down payments and bills of exchange.
Special G/L transaction: The special transactions in accounts receivable and accounts payable that are shown separately in the general ledger and sub-ledger.
They include:
  • Bills of exchange
  • Down payments
  • Guarantees
House Bank: A business partner that represents a bank through which you can process your own internal transactions.
Document type: A key that distinguishes the business transactions to be posted. The document type determines where the document is stored as well as the account types to be posted.
Account type: A key that specifies the accounting area to which an account belongs.
Examples of account types are:
  • Asset accounts
  • Customer accounts
  • Vendor accounts
  • G/L accounts
Dunning procedure: A pre-defined procedure specifying how customers or vendors are dunned.
For each procedure, the user defines
  • Number of dunning levels
  • Dunning frequency
  • Amount limits
  • Texts for the dunning notices
Dunning level: A numeral indicating how often an item or an account has been dunned.
Dunning key: A tool that identifies items to be dunned separately, such as items you are not sure about or items for which payment information exists.
Year-end closing: An annual balance sheet and profit and loss statement, both of which must be created in accordance with the legal requirements of the country in question.
Standard accounting principles require that the following be listed:
  • All assets
  • All debts, accruals, and deferrals
  • All revenue and expenses
Month-end closing: The work that is performed at the end of a posting period.
Functional area: An organizational unit in Accounting that classifies the expenses of an organization by functions such as:
  • Administration
  • Sales and distribution
  • Marketing
  • Production
  • Research and development
Classification takes place to meet the needs of cost-of-sales accounting.
Noted item: A special item that does not affect any account balance. When you post a noted item, a document is generated. The item can be displayed using the line item display. Certain noted items are processed by the payment program or dunning program - for example, down payment requests.
Accrual and deferral: The assignment of an organization's receipts and expenditure to particular periods, for purposes of calculating the net income for a specific period.
A distinction is made between:
  • Accruals -
An accrual is any expenditure before the closing key date that represents an expense for any period after this date.
  • Deferral -
Deferred income is any receipts before the closing key date that represent revenue for any period after this date.
Statistical posting: The posting of a special G/L transaction where the offsetting entry is made to a specified clearing account automatically (for example, received guarantees of payment).
Statistical postings create statistical line items only.
Valuation area: An organizational unit in Logistics subdividing an enterprise for the purpose of uniform and complete valuation of material stocks.
Chart of depreciation: An object that contains the defined depreciation areas. It also contains the rules for the evaluation of assets that are valid in a specific country or economic area. Each company code is allocated to one chart of depreciation. Several company codes can work with the same chart of depreciation. The chart of depreciation and the chart of accounts are completely independent of one another.
Asset class: The main criterion for classifying fixed assets according to legal and management requirements.
For each asset class, control parameters and default values can be defined for depreciation calculation and other master data.
Each asset master record must be assigned to one asset class.
Special asset classes are, for example:
  • Assets under construction
  • Low-value assets
  • Leased assets
  • Financial assets
  • Technical assets
Depreciation area: An area showing the valuation of a fixed asset for a particular purpose (for example, for individual financial statements, balance sheets for tax purposes, or management accounting values).
Depreciation key: A key for calculating depreciation amounts.
The depreciation key controls the following for each asset and for each depreciation area:
  • Automatic calculation of planned depreciation
  • Automatic calculation of interest
  • Maximum percentages for manual depreciation
The depreciation key is defined by specifying:
  • Calculation methods for ordinary and special depreciation, for interest and for the cutoff value
  • Various control parameters
Period control method: A system object that controls what assumptions the system makes when revaluating asset transactions that are posted partway through a period.
Using the period control method, for example, you can instruct the system only to start revaluating asset acquisitions in the first full month after their acquisition.
The period control method allows different sets of rules for different types of asset transactions, for example, acquisitions and transfers.
Depreciation base: The base value for calculating periodic depreciation.
The following base values are possible, for example:
  • Acquisition and production costs
  • Net book value
  • Replacement value

Bank Accounting

1) Bank Master can be created four ways :

i) When entering Customer/Vendor master records or in the customizing for house banks.

ii) Using the create bank transaction in the accounts payable/receivable master data menu.

The bank directory can be imported from disk/tape using program RFBVALL_O.

Customers using lock box function can create a batch input session that automatically updates customer banking information in the master records.

2) Bank key contains - Bank Master data contains Bank name, Region (State), Address

3) Bank key is assigned to a house bank.

4) GL a/c code is assigned to the house bank along with Account id.

5) Steps to create – House bank

i) Create bank master with bank key (E.g. – 01)

ii) Create House bank (E.g. – ICICI) – Enter House bank id, Country, Bank key, Contact person + telephone numbers.

iii) Create bank a/c – Enter House bank id already created (It will take bank address from already assigned bank key to that house bank id), Bank id (E.g. SB), Description (E.g.-Savings bank a/c), Bank a/c no, Currency, G/L a/c.

iv) Change G/L a/c – in tab -create/bank/interest, enter house bank id and Account id.

Summary

(a) Create -Bank key,

(b) Create house bank id and add bank key.

(c) Create bank a/c with Account id and assign GL a/c.

(d) Modify G/L a/c and assign House bank+Account id.


6) For every bank a/c G/L account must be created. This G/L account is assigned to the bank a/c and vice versa. Both accounts have to have the same account currency.

7) In the Customer/Vendor master record, the field “Bank Type” is used to distinguish between different banks.

8) Using the house bank id and the bank types the payment program determines the banks to be used.

9) Each bank a/c is reflected in the SAP system by a combination of house bank ID and account ID (bank type).

10) The bank group is used for classifying banks. The key is freely assignable. The aim of classification is to group banks together in such a way that payment transactions within a group can be carried out as fast as possible (payment optimization).

11) The SWIFT code is used for identifying banks in international payment transactions.

12) Every bank master record is identified by the bank country and bank key.

Assets and Liability closing T codes


1. Process Depreciation Run 
Accounting -> Financial accounting -> Fixed assets -> Periodic processing -> Depreciation run -> Execute - AFAB
2. Process Investment Grant 
Accounting -> Financial accounting -> Fixed assets -> Periodic processing -> Investment grant
- AR11
3. Process Revaluation 
Accounting -> Financial accounting -> Fixed assets -> Periodic processing -> Revaluation for the balance sheet -> Post revaluation - AR29
4. AA Fiscal Year Change 
Accounting -> Financial accounting -> Fixed assets -> Periodic processing -> Fiscal year change - AJRW
5. AA Fiscal Year Close – Account Reconciliation 
Accounting -> Financial accounting -> Fixed assets -> Periodic processing -> Year-end closing -> Account reconciliation - ABST2
6. AA Fiscal Year Close 
Accounting -> Financial accounting -> Fixed assets -> Periodic processing -> Year-end closing -> Execute - AJAB
7. Produce Asset History Sheet 
Accounting -> Financial accounting -> Fixed assets -> Info system -> Reports on Asset Accounting -> Balance Sheet Explanations -> International -> Asset History Sheet
or
Accounting -> Financial accounting -> Fixed assets -> Info system -> Reports on Asset Accounting -> Balance Sheet Explanations -> Country Specifics - various 
8. Produce GR/IR Balance Report 
Logistics -> Materials Management -> Inventory Management -> Environment -> Balances Display -> List of GR/IR Bals. - MB5S
9. Maintain GR/IR Clearing Account 
Logistics -> Materials Management -> Invoice Verification -> Invoice Verification -> Further processing -> Maintain GR/IR acct - MR11
10. Material Revaluations – Price Changes (manual) 
Logistics -> Materials Management -> Valuation -> Valuation -> Price Determination -> Change price - MR21
11. Material Revaluations – Debit/Credit Material 
Logistics -> Materials Management -> Valuation -> Valuation -> Price Determination -> Debit/cred. material - MR22
12. Product Costing Material Price Change 
Accounting -> Controlling -> Product Cost Controlling -> Product Cost Planning -> Material Costing -> Price Update - CK24
13. Material Ledger Closing 
Logistics -> Materials Management -> Valuation -> Actual Costing/Material Ledger -> Periodic material valuation -> Post closing - CKMI
14. Materials Management Closing 
Logistics -> Materials Management -> Material Master -> Other -> Close period - MMPV
15. Materials Management Closing – Control Posting to Prior Period 
Logistics -> Materials Management -> Material Master -> Other -> Allow posting to previous period - MMRV
16. Lowest Value Determination – Market Prices 
Logistics -> Materials Management -> Valuation -> Valuation -> Bal. sheet valuation -> Determ. lowest values -> Market prices - MRN0
17. Lowest Value Determination – Range of Coverage 
Logistics -> Materials Management -> Valuation -> Valuation -> Bal. sheet valuation -> Determ. lowest values -> Range of coverage - MRN1
18. Lowest Value Determination – Movement Rate 
Logistics -> Materials Management -> Valuation -> Valuation -> Bal. sheet valuation -> Determ. lowest values -> Movement rate - MRN2
19. Lowest Value Determination – Loss-Free Valuation 
Logistics -> Materials Management -> Valuation -> Valuation -> Bal. sheet valuation -> Determ. lowest values -> Loss-free valuation - MRN3
20. LIFO Valuation 
Logistics -> Materials Management -> Valuation -> Valuation -> Bal. sheet valuation -> LIFO Valuation - Various
21. FIFO Valuation 
Logistics -> Materials Management -> Valuation -> Valuation -> Bal. sheet valuation -> FIFO Valuation - Various
22. Physical Inventory Processing 
Logistics -> Materials Management -> Physical Inventory - Various
23. Analyze GR/IR Clearing Accounts and Display Acquisition Tax 
Accounting -> Financial accounting -> General ledger -> Periodic processing -> Closing -> Regroup -> GR/IR clearing -   F.19
24. Define Adjustment Accounts for GR/IR Clearing 
IMG -> Financial Accounting -> General Ledger Accounting -> Business Transactions -> Closing -> Regrouping -> Define Adjustment Accounts for GR/IR Clearing - OBYP
25. Print Balance Confirmation 
Accounting -> Financial accounting -> A/P or A/R -> Periodic processing -> Closing -> Check/count -> Balance confirmation: Print
or
Accounting -> Financial accounting -> A/P or A/R -> Periodic processing -> Print correspondence -> Balance confirmation -> Print letters - F.17
26. Configure Balance Confirmation 
Accounting -> Financial accounting -> A/P or A/R -> Periodic processing -> Closing -> Check/count ->…
or
Accounting -> Financial accounting -> A/P or A/R -> Periodic processing -> Print correspondence -> Balance confirmation - F.1B, F.1A
27. Post Individual Value Adjustment 
Accounting -> Financial accounting -> Accounts receivable -> Document entry -> Other -> Intern. trans. posting -> Without clearing - F-21
28. Define Account Determination for Flat-Rate Individual Value Adjustment 
IMG -> Financial Accounting -> Accounts Receivable and Accounts Payable -> Business Transactions -> Closing -> Valuate -> Valuations -> Define Accounts  OBB0
29. Configure Flat-Rate Individual Value Adjustment 
IMG -> Financial Accounting -> Accounts Receivable and Accounts Payable -> Business Transactions -> Closing -> Valuate -> Valuations ->…  SPRO
30. Calculate Flat-Rate Individual Value Adjustment 
Accounting -> Financial accounting -> Accounts receivable -> Periodic processing -> Closing -> Valuate -> Further valuations - F107
31. Writing-Off Doubtful Receivables 
Accounting -> Financial accounting -> Accounts receivable -> Document entry -> Other -> Intern. trans. psting -> With clearing - F-30
32. Customizing Exchange Rates 
IMG -> General Settings -> Currencies - Various
33. Maintaining Exchange Rates 
Accounting -> Financial accounting -> General ledger -> Environment -> Current settings -> Enter exchange rates - OB08
34. Customizing Valuation Methods 
IMG -> Financial Accounting -> General Ledger Accounting -> Business Transactions -> Closing -> Valuating -> Foreign Currency Valuation -> Define Valuation Methods - OB59
35. Foreign Currency Open Item Valuation 
Accounting -> Financial accounting -> General ledger -> Periodic processing -> Closing>>Valuate -> Valuation of Open Items in Foreign Currency - F.05
36. Account Determination for Exchange Rate Differences 
IMG -> Financial Accounting -> General Ledger Accounting -> Business Transactions -> Closing -> Valuating -> Foreign Currency Valuation -> Prepare automatic postings for foreign currency valuation - OBA1
37. Regroup Receivables and Payables 
Accounting -> Financial accounting -> A/P or A/R -> Periodic processing -> Closing -> Regroup -> Receivables/ Payables - F101
38. Account Determination for Regrouping Receivables and Payables 
IMG -> Financial Accounting -> Accounts Receivable and Accounts Payable -> Business Transactions -> Closing -> Regrouping - OBBV, OBBW, OBBX
39. Revalue Foreign Currency G/L Account Balances 
Accounting -> Financial accounting -> General ledger -> Periodic processing -> Closing -> Valuate -> Foreign Currency Valuation of Inventory - F.06
40. Posting Accruals/Deferrals 
Accounting -> Financial accounting -> General ledger -> Periodic processing -> Closing -> Valuate -> Enter Accrual/Deferral Doc. - FBS1
41. Posting Accrual/Deferral Reversal 
Accounting -> Financial accounting -> General ledger -> Periodic processing -> Closing -> Valuate -> Reverse Accrual/Deferral Document - F.81
42. Generate Recurring Entry Posting 
Accounting -> Financial accounting -> General ledger -> Periodic processing -> Recurring Entries -> Execute - F.14