Agenda – Zero Level Training

 Functional Modules Introduction

SAP Financials (FI)

SAP Controlling (CO)

 SAP
Financials
 SAP Financials Organizational Structure

Client

Chart of Accounts Company Code

Chart of Depreciation
 SAP FICO Organizational Structure

Client

Chart of Accounts Company Code Controlling Area

Cost Center
Chart of Depreciation

Profit Center
 SAP FICO Organizational Structure

Client

Chart of Accounts Company Code Controlling Area

Cost Center
Chart of Depreciation

Profit Center

Client: The client is the highest level in the SAP System hierarchy.
Specifications that you make, or data that you enter at this level are valid for all company codes
and for all other organizational structures. You therefore only need to make these specifications,
or enter this data once. This ensures that the data is consistent.
 SAP FICO Organizational Structure

Client

Chart of Accounts Company Code Controlling Area

Cost Center
Chart of Depreciation

Profit Center

Company Code: A company code represents an independent legal accounting entity.

It is the smallest organizational unit for which complete, independent accounting can be carried
out. This includes the entry of all transactions subject to posting and the creation of all items for
Legal individual financial statements, such as the balance sheet and the profit and loss statement.
 SAP FICO Organizational Structure

Client

Chart of Accounts Company Code Controlling Area

Cost Center
Chart of Depreciation

Profit Center

Chart of Accounts: The chart of accounts in SAP ( COA ) is a list of GL accounts master record
That are used by the organization. The chart of accounts must be assigned to each company
code. Chart of Accounts is defined at client level.
 SAP FICO Organizational Structure

Client

Chart of Accounts Company Code Controlling Area

Cost Center
Chart of Depreciation

Profit Center

Chart of Depreciation: Charts of depreciation is used in order to manage various legal

Requirements for the depreciation and valuation of assets. The chart of depreciation is
usually at a country level and assigned to a company code. It includes all the procedures
for the assets assigned under that chart.
 SAP FICO Organizational Structure

Client

Chart of Accounts Company Code Controlling Area

Cost Center
Chart of Depreciation

Profit Center

Controlling Area: Controlling area is the central organizational unit in CO module. It represents
a closed system for cost accounting purposes, where costs and revenues can be managed.
 SAP FICO Organizational Structure

Client

Chart of Accounts Company Code Controlling Area

Cost Center
Chart of Depreciation

Profit Center

Profit Center: Organizational unit within a controlling area that represents a location where
revenues occur.

Profit Center Hierarchy: Profit Center Hierarchy is a tree structure for grouping all profit
centers which belong to a controlling area.
 SAP FICO Organizational Structure

Client

Chart of Accounts Company Code Controlling Area

Cost Center
Chart of Depreciation

Profit Center

Cost Center: Organizational unit within a controlling area that represents a location where
costs occur.

Cost Center Hierarchy: Cost Center Hierarchy is a tree structure for grouping all cost centers
which belong to a controlling area.
 Overall SAP Organizational Structure
Organizational units are used to structure business functions and for reporting.

Chart of Accounts Client

Chart of Depreciation
Company Code Controlling Area

A Company Code is a unit for Profit Center

which legal financial statements
must be prepared.
Personnel Area Cost Center

Sales Organization
The Controlling
Purchasing Organization
Area is the
Sales Organization is business unit
the central Distribution Channel where Cost
organizational Accounting is
element that controls carried out.
Division Plant
the terms of sale to
the customer.

Distribution Channel is
Finance & the element that
Controlling related describes through what
channel goods and/or Shipping Point
(Plant is one of the condition to Storage Location
Logistic related services will be derive shipping point)
distributed to the
HCM related customer.
SAP Financials Components

 General Ledger Accounting

 Accounts Payable

 Accounts Receivables

 Asset Accounting

 Cash & Bank

SAP Financials Components

 General Ledger Accounting

 Accounts Payable

 Accounts Receivables

 Asset Accounting

 Cash & Bank

 General Ledger Master Data

 The GL master record controls how business transactions are recorded and
processed by the system.
 Specific control checks are assigned in GL master Data which are triggered at the
time of transactional posting.
 General Ledger Accounting

 The General Ledger (G/L) contains records of all posting-relevant business

transactions in General Ledger accounts. In order to get a better overview, the
general ledger frequently contains only collective postings. The individual posting
data is recorded in sub ledgers, which update the general ledger in summarized
form.
 The central task of General Ledger accounting is to provide a comprehensive picture
of external accounting and accounts.
 General Ledger Accounting serves as a complete record of all business transactions.
It is the centralized, up-to-date reference for the rendering of accounts.
 Actual individual transactions can be checked at any time in real-time processing by
displaying the original documents, line items, and transaction figures at various
levels.
SAP Financials Components

 General Ledger Accounting

 Accounts Payable

 Accounts Receivables

 Asset Accounting

 Cash & Bank

 Accounts Payable Master Data

 The master record contains data that controls how business transactions are
recorded and processed by the system.
 It also includes all the information about a vendor that you need to be able to conduct
business with him.
 Vendor master data is used by both the accounts and purchasing department in an
organization.
 Accounts Payable

 Accounts Payable component records and manages accounting data of all vendors.
It is also an integral part of the purchasing system, where deliveries and invoices are
managed according to vendors.
 Postings made in Accounts Payable are simultaneously recorded in the General
Ledger where different G/L accounts are updated based on the transaction involved
(such as payables and down payments).
 The system also maintains forecasts and standard reports that can be used to keep
track of all the open items.
 Process Flow-Accounts Payable

Process Flow for Accounts Payables

Management
Material

Raise Purchase Create PO with Goods Receipt Invoice

Start
Requisitions reference to PR Posting Verification
Accounts Payable

End
Clearing of Payment to
Vendor Vendor
SAP Financials Components

 General Ledger Accounting

 Accounts Payable

 Accounts Receivables

 Asset Accounting

 Cash & Bank

 Accounts Receivables Master Data

 The master record contains data that controls how business transactions are
recorded and processed by the system.
 It also includes all the information about a customer that you need to be able to
conduct business with him.
 Customer master data is used by both the accounts and sales department in an
organization.
 Accounts Receivables

 Accounts Receivable component records and manages accounting data of all

customers. It is also an integral part of sales management.
 All postings in Accounts Receivable are also recorded directly in the General Ledger.
 It also provides the data required for effective credit management.
 Process Flow-Accounts Receivables

Process Flow for Accounts Receivables

Accounts Receivable Sales & Distribution

Billing
Raise Sales Post Goods
Start Documents/
Order Issuance
Invoice

Direct billing
Clearing of Receipts from
document can
End Customer Customer/
also be raised
ledger Collection
in FI
SAP Financials Components

 General Ledger Accounting

 Accounts Payable

 Accounts Receivables

 Asset Accounting

 Cash & Bank

 Asset Accounting

 Asset Accounting covers the entire life of the asset from the purchase order or initial
acquisition (which can be managed as an asset under construction) right through to
retirement of the asset. Between these two events, the system handles all asset-
related business transactions and ensures integration with the general ledger.
 Process Flow-Assets

Process Flow for Asset Accounting

Management

Raise Technical
Material

Good Receipts
Purchase Create PO with
Start posting/
Requisitions for reference to PR
Capitalization
Asset
Asset Accounting

Asset
Asset can also
retirement as
End be directly
and when
capitalized
required
SAP Financials Components

 General Ledger Accounting

 Accounts Payable

 Accounts Receivables

 Asset Accounting

 Cash & Bank

 Cash Journals

 The Cash Journal is a sub ledger of Bank Accounting. It is used to manage a

company's cash transactions.
 The system automatically calculates and displays the opening and closing balances,
and the receipts and payments totals.
 You can run several cash journals for each company code. You can also carry out
postings to G/L accounts, as well as vendor and customer accounts.
 Bank Master Data

 House Bank and Account ID Creation

 Check lot Maintenance
 Integration Points

 Integrated with Material Management

 Integrated with Sales & Distribution

 Integrated with Human Capital Management

 Integrated with Controlling

 SAP
Controlling
 SAP FICO Organizational Structure

Client

Chart of Accounts Company Code Controlling Area

Cost Center
Chart of Depreciation Business Area

Profit Center
 SAP FICO Organizational Structure

Client

Chart of Accounts Company Code Controlling Area

Cost Center
Chart of Depreciation Business Area

Profit Center

Controlling Area: Controlling area is the central organizational unit in CO module.

It represents a closed system for cost accounting purposes, where costs and
revenues can be managed.
 SAP FICO Organizational Structure

Client

Chart of Accounts Company Code Controlling Area

Cost Center
Chart of Depreciation Business Area

Profit Center

Cost Center: Organizational unit within a controlling area that represents a location
where costs occur.

Cost Center Hierarchy: Cost Center Hierarchy is a tree structure for grouping all
cost centers which belong to a controlling area.
 SAP FICO Organizational Structure

Client

Chart of Accounts Company Code Controlling Area

Cost Center
Chart of Depreciation Business Area

Profit Center

Profit Center: Organizational unit within a controlling area that represents a location
where revenues occur.

Profit Center Hierarchy: Profit Center Hierarchy is a tree structure for grouping all
profit centers which belong to a controlling area.
 SAP Controlling Processes

Master Planning Actual Period End Reporting

Data Posting Closing

 Cost Element  Determine and  Monitor actual  Complete  Execute

enter the figures out of allocation of reports for
planned values. upstream actual figures to Management.
 Cost Center systems and the respective
 E.g., Plan values modules (FI,SD, cost object.
 Internal order for Cost HR, etc.).
Elements, Cost  Monthly/Quarter
Center, profit  ly/Annual
 Profit Center center etc. Allocate actual
Activity
figures to the
 Internal Order respective cost
Planning Object.
 Controlling: Cost Element Accounting

 Cost Element Accounting allows Controlling costs and revenues that incur in an
organization, serves as an interface between Financial Accounting and Management
Accounting and ensures that FI and CO are reconciled.
 Controlling: Cost Center Accounting

 Cost Center Accounting serves as a tool for monitoring overhead costs and assigning
them to the particular location at which they occurred in line with their source.

 In Cost Center Accounting, Cost Centers can be created according to different

department. It helps to achieve the following objectives:-

 Assigning costs to Cost Centers in a Cost Center hierarchy lets you determine where
costs are incurred within the organization.
 Planning the costs at Cost Center level will help to check the cost efficiency at a
particular Cost Center through variance analysis report.
 Controlling: Cost Center Accounting
Cost Centers and the Standard Hierarchy

H1: IDES Europe

Processing cost centers
H1000: CoCd 1000
H1010: Internal

1110 Executive Board

1110 Executive Board

H1120: Internal Services

1000 Internal services
1200 Cafeteria

H1200: Finance & Admin.

H1210: Admin.
H1200: Finance & Admin.

H1000: CoCd 2000

 SAP AG 1999
 Controlling: Internal Orders

 Internal order management is the most detailed operational level of cost and activity
accounting.

 Internal orders can be real or statistical.

 Real orders are normally used to plan, collect, and settle the costs of internal jobs and
tasks. The SAP system enables you to monitor your internal orders throughout their
entire life-cycle; from initial creation, through the planning and posting of all the actual
costs and to the final settlement. E.g. Asset Under Construction.

 Statistical Order is purely for Statistical purpose for Management Analysis purpose.
E.g. To analyze vehicle maintenance cost
 Controlling: Profit Center Accounting

 Profit Center Accounting is used for analyzing internal profit of the company. Profit
Centers represent organizational sub-units that operate independently on the market
and bear responsibility for own costs and revenues. In other words, in Profit Center
accounting a company is divided in to Profit Center according to the companies’
requirement e.g. Profit Centers can be setup according to product (product lines,
divisions), geographical factors (regions, offices or production sites) or by department.
Controlling: Profit Center Accounting

The Profit Center Standard Hierarchy

9010
H1 Corporate
IDES Europe Finance
H2000
H2000
Corporate
H1000
H1000 9000
Stock Corporate
Admin
Products
H1010
Vehicles
H1200
H1110 H1120 H1400
Accessories
Motorcycle Bicycles Techical
Department
1110 1000
H1210 H1220 H1230
Model R1100 Model BX4
Bike Parts Sportwear Helmets
H1300
1200
Model CV2
2100 2200 2300 Sales &
1210 Seats Shirts Motorcycle Marketing
Model MX3 Helmets
1220
Model RX7

 SAP AG 1999
 Controlling: Profit Center Accounting

Controlling
Controlling Area

Profit Centers

Profit
Profit Profit Profit Profit Profit Profit
Center
Center Center Center Center Center Center

A Ltd A1 Ltd HQ
Company Codes 1000

Cost Centers Cost Cost Cost Cost

Center A Center B Center C Center D