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SAP FI/CO A Brief Introduction & Outline By Raj Batni October 2008

SAP FI/CO A Brief Introduction & Outline - By Raj Batni Page 2 of 4 SAP FINANCE & CONTROLS: A BRIEF INTRODUCTION & OUTLINE In todays world of innovation through Information Technology, SAP is truly a dynamic package by which one can integrate, diversify, and streamline their work-processes with multi-dimensional compatibility. SAP Systems, Applications, and Products in Data Processing was founded in 1972 with its headquarters in Walldorf, Germany.

For those who are in the Finance/Accounting Profession who wish to delve into a creative and interactive scenario by which they can apply their hands-on experience & expertise to another level of fantastic intellectual stimulation, SAP FI/CO Implementation & Configuration is truly the ultimate. Their expertise will render them to very swiftly master its technical configuration for the concepts are all part of every Finance/Accounting Professionals innate thought-process and - the SAP modules follow a thorough schematic pattern by which all functionalities & technicalities are logically laid-out. SAP Financial Accounting (FI) is an important core module where in live-time, the financial processing transactions are all captured to provide the basis via which data is drawn for external reporting. This SAP FI Module is integrated with many parallel modules that enable a company to unify processes that may have needed the utilization of many software packages.

Other Modules of SAP that commonly find a role of integration with FI are (but not limited to) Material Management (MM), Sales & Distribution (SD), Human Resources (HR), Product Planning (PP), Controlling (CO), etc. Amongst these CO Controlling is another major focus for those coming from the Finance/Accounting/Auditing/Budgeting and Financial Reporting/Analysis Backgrounds/Professions. SAP FI: There are many sub-modules that streamline and specialize in each aspect of the Financial Accounting Processes: AA Asset Accounting AP Accounts Payable AR Accounts Receivable BL Bank Accounting FM Funds Management GL General Ledger Accounting LC Legal Consolidations SL Special Purpose Ledger TM Travel Management

Out of the above, FI-AR, FI-AP, & FI-AA are the three sub-modules that send simultaneous postings to FI-GL. SAP FI/CO A Brief Introduction & Outline - By Raj Batni Page 3 of 4 Now, the new SAP GL integrates many streamlined processes to be unified more closely to further alleviate any duplication of live-time tasks. This New General Ledger Accounting in mySAP ERP has some dynamic advantages in comparison to the classic General Ledger Accounting (as used in SAP R/3 Enterprise Version) such as the ability to run real-time reconciliation between Management Accounting (CO) and Financial Accounting (FI) i.e. there is a real-time integration with Controlling. Previously time-consuming reconciliations are hence now rendered obsolete. The new SAP GL further allows the management of multiple ledgers within the General Ledger Accounting Module itself. This

creates the scope for portraying parallel accounting scenarios within the SAP System. Controlling (CO) is the term by which SAP refers to Managerial Accounting. The Organizational Elements in CO are Operating Concern, Controlling Area, and Cost Centers. Hence, the SAP CO Module helps management by providing reports on cost centers, profit centers, contribution margins, profitability, etc. It focuses on internal users, in contrast to FI which focuses on data drawn for external reporting. The transactions posted in FI are transferred to CO for cost accounting processing, analytical reporting, and audit-controlling spectrums.

There can be either a one-to-one relationship or there can be one-to-many relationship between Controlling Areas Verses Company Codes. Hence, CO becomes the governing module that oversees the consolidation of costing data whereby management can derive their perspectives for analysis. The SAP Controlling (CO) Modules Components are: Cost Element Accounting Cost Controlling Cost Center Accounting Internal Orders Activity-Based Costing Product Cost Controlling Profitability Analysis Profit Center Accounting Some methodologies that are unique in their structural concepts are for example CO PA & PCA. PA refers to Profitability Analysis that derives from how profitable your market-segments are on their external sides. EC-PCA refers to Profit Center Accounting that produces the analysis that portrays how your internal profit centers are functioning in terms of their profitability. To further expand the potential, we also have CO-PC in SAP which streamlines Product Cost Controlling. SAP FI/CO A Brief Introduction & Outline - By Raj Batni Page 4 of 4 CO-PA supports two forms of Profitability Analysis: Costing-based & Account-based. Costing-Based Profitability Analysis groups costs and revenue according to value fields and costing-based evaluation approaches. Both of these may be defined by the client. It provides the client with a complete short-term profitability reporting capability at all times.

Account-Based Profitability Analysis is organized in accounts using an account-based valuation process. Its use of cost and revenue elements gives it a distinguishing characteristic. This provides the client with a profitability report that is permanently reconciled with financial accounting. Hence, Profitability Analysis (CO-PA), alongside Profit Center Accounting (EC-PCA), is one of the application components of Profitability Analysis.

The SAP Control (CO) Module is integrated with FI, AA, SD, PP, and HR. While FI is the main source for data for CO, the others such as SD, MDD, and PP have many integration points with CO. Revenue postings in FI will result in postings in CO-PA & EC-PCA. The HR Module also generates various types of costs to CO. In addition, Planned HR Costs can be passed on to CO as well for CO planning purposes. Above is a brief outline and write-up about the dynamics of SAP FI/CO. It would be well worthwhile for Finance/Accounting Professionals to explore the depths of this innovative software for the enrichment of their career spectrum.

Treasury Cash Management module

The Treasury / cash management / basic functions sub module contains functionality that you may expect to find in FI: Comment This transaction can be used to record cheques received, print deposit slips and makes Cheque deposit appropriate postings to the GL (Bank clearing accounts and AR customer accounts. Configuration is partially shared with the bank statement load. Cheques cashed (manual entry or This program updates the payment documents with cashed information and makes appropriate automatic entry upload) GL postings for cash flow forecasting. Bank Statement Load (manual entry This transaction or program reconciles the bank statement with the incomings and outgoings that or automatic entry upload) have been entered via the payment program, cheque deposit or manual transactions entered. This transaction can provide a view of all Bank and financial (loan etc) accounts, customer and vendor expected incomings and outgoings, as well as commitments (purchase orders) and possible sales. Memo items can be added to complete the picture. These can all be classified by degree of certainty of payment date and you could configure the option to 'distribute' amounts over time periods for 'uncertain' groupings. Cash Position and Forecast This is actually surprising easy to implement once you understand how it works. Surprise your client - or at least the treasurer - and deliver more than expected. The design and configuration is best done when you first set up your customer, vendor and GL accounts anyway so that the appropriate settings are made - no rework. Functionality

FF.5 Upload Electronic Bank Statements

Use FF.5 to upload electronic bank statements. You can upload your Prior Day and Current Day statements here.

FF.6 View Bank Statements

Use FF.6 to view bank statements.

FF6B Memo Records: List

This allows you to view and to Convert or archive off the memo records that are not set to automically archive off.

FF7A Cash Management and Forecast

Use FF7A to run your Cash Position or Liquidity Forecast reports. From within these, you can Create Memo records. Click the Create Single Record button.

FF67 Process Manual Bank Statements

Use FF67 to process Manual bank Statements. Click the Overview button to show a list of your accounts, and you can drill in to see the statements.


Use FEBAN for Post-processing of bank statements (FEBA_LOCKBOX and FEBA_BANK_STATEMENT are t-codes specific to either Lockboxes or regular Bank Statements). This allows you to make GL account or other corrections and post the transactions that didnt go through on the initial upload. On the initial selection screen, you can just skip the selections and it will show you a tree of your House Bank IDs and it will mark entries that didnt post with the Red dot icon .

SE38 program RFEBKA40 Post Memo Records

This will post memo records of your current day statements (you upload them through FF.5) so that they will show up in your Cash Position and Liquidity Forecast reports.

SE38 program RFEBKA96 - Delete Bank Statements

Use RFEBKA96 to delete Bank Statements! Be very careful! This only deletes the statements, not the GL postings (youll have to reverse those some other way like in FB03 or FB08). You dont have to enter anything into the selection screen. Once youre in, click the Delselect All. Then manually (check the checkbox) select the statement(s) you want to delete.

OT83 Configuration t-code for BAI codes, Account Symbols, and Assigning Bank Accounts
There are several functions under OT83. Here you create Account symbols and assign them to GL accounts. The functions also include Creating Posting Rules and posting Keys and assigning External Transaction Codes (BAI codes).

FI12 (also see FBZP) Configure House Banks and Bank Accounts
The primary t-code for creating House Banks and their Bank Accounts. Here, they are assigned to Company Codes, GL Accounts, currency, etc.

FBZP Payment Program Customizing

FBZP provides access to configuring:

Company Codes Paying Company Codes Payment Methods in Country Payment Methods in Company Codes Bank Determination House Banks

DMEE Payment Medium Workbench (PMW)

One of the requirements for Outbound bank payments is that you provide data in their specified file formats. While US Banks use the Fedwire network for wire transactions, they tend to have their own file formats. The DMEE Engine or Payment Medium Workbench allows you to configure custom file formats for these types of transactions. The PMW is accessed through t-code DMEE.

FDFD Cash Management Implementation Tool

FDFD is a tool to help implement Cash Management and Forecasting. The 5 areas it touches are: 1. 2. 3. 4. 5. Activate Company Code Vendor/Customer data Data Setup Data Reconciliation Data Correction

Take a look at the Application Help for further details.

TBB1 Treasury: Post Flows

Generates financial accounting transaction from various financial instruments FX, Money Market, Derivatives, Securities. This would be where a payment of a long term debt would get placed into your Payment Requests GL Account, which would get picked up in your F111 payment runs.

FIBLAPOP Vendors Payment Request

If you want to make a Fedwire payment to a vendor, you can use FIBLAPOP to create the Payment Request. You will need to have the Bank information set up on the Vendor Master. (Note: it is a good idea to have the bank info on the vendor master configured as sensitive fields for security and control purposes.) This generates a payment request similar to what FRFT doessee below.

FRFT Rapid Entry with Repetitive Code

Create Fedwire payments with repetitive codes. You can optionally set up Repetitive Codes with your banks or use them internally with SAP. These identify the payment information for specific payees. You will be able to change the amounts and instructions at the time you create the payments. Having the Repetitive codes provides significant controls you have around the business partners that are eligible to receive wire payments. Creates payment requests based on the entries in the a Payment Request GL account that you would specify in your Parameter definition.

F111 Automatic Payment Transaction for Payment Requests

Creates payments based on the entries in the a Payment Request GL account that you would specify in your Parameter definition. You would first create a Payment Request through t-code FRFT (using Repetitive codes) or RVND (free form payment requests), but due to controls issues, FRFT and repetitive codes are recommended.

s_p99_41000099 Payment List

The Payment List report (s_p99_41000099) will show the details for an F110 Check or ACH Payment run. Enter the run date and the Identification and it shows the vendors and invoices that make up the proposal list for the specified proposal run.

FCHN Check Register

FCHN will display the checks for a Payment Run. Note: to view the checks online (as they would look in the print out), you can (if you have rights to view them) go to System > Own Spool Requests, and then look for the spool files that say something like Accounts Payable Checks. You may not have access to this in Production (but you might). Also, this only lets you see spool requests you created.

FCKR Cashed Checks

FCKR (program RFEBCK00) allows you to upload file containing Cashed Checks. These files may be called Check Encashment files or Check Reconciliation files. You can post these to the GL to clear your outstanding checks account. You can also generate a test file using program RFEBCKT0, but Ive had trouble getting it to upload .

S_P99_41000099 Payment List

Shows all payments, not just checks like FCHN does.

BD87 View IDocs

While BD87 is not exactly a Treasury T-code, it does allow you to view IDocs and can be used in helping you to run down problems with your ACH (EDI) payments. Our IDoc payments have a Message Type of PAYEXT, so we can search on that message type for the day and see all of our payment IDocs. A status code of 16 means you sent and got back a confirmation.

Bonus Tables for payment methods on vendor: LFB1

SE16 and table LFB1 gives you vendor data with Payment Methods Table LFA1 gives you vendor name and address information