SAP FICO basic Settings:

Creations company
Company code
Assign company code to company
Business area
Fiscal year variant
Asian fiscal year variant to company code
Chart of accounts
Accounts Group
Retained earning account
Posting period variant
Document Types and no ranges
Filed status variant
Tolerance group
Posting Keys

General Ledger Configuration

GL master record
Posting of document
Display balances of GL
Parking, hold
Accrual, sample documents
Deferral documents
Foreign exchange
Reversal of documents
Interest calculation
Cash management
Bank reconciliation

Account Payable
Vendor groups(MM and FICO vendors)
No. ranges for vendor accounts
Tolerance group for vendors
House bank
Correspondence
Automatic payment program
Extended with holding tax
Terms of payments
Down Payment Made
Cash discount (received)
Account Receivable

Customer group (SD and FI/CO customers)

No. ranges for customers accounts

Customer master records

Down Payment Received

Dunning

Cash discount (CIN version)

Bills of exchange
Treasury management
Asset Accounting

Chart of depreciation

Account determination

Screen layout

Asset classes

Integration with FI

Depreciation methods

Depreciation keys

Asset master

Sub Asset Master

Asset report

Depreciation run

Sale of asset

Transfer of asset

Scrapping of asset

Capital work in progress

Controlling

Controlling area

No. of ranges for controlling documents

Versions

Cost element accounting(manual, automatic)

Cost Centre Accounting

Repost line items, repost of cost

Actual overhead assessment

Planning cost centre and cost element

Budgeting
Internal Order

Order type

Order, Statistical Key Figure

Planning internal order wise

View internal order wise report

Profitability Accounting (PCA)

Controlling settings
Dummy profit centre actual data
Profit centre assignment of revenue elements
Choose account, creation of cost object
Planning profit and loss items
Planning balance sheet items

Profitability Analysis (CO-PA)

Operation concern

Profitability segments

Assignment of controlling area to operating

Activate profitability analysis
Mapping of conditions to coop values
Drill down report
Report painter
Product Costing-Material Ledger

Creation of secondary cost element

Active type

Price calculation

Work centre

Overhead keys

Routing

Cost sheet variant

Cost estimate with quantity structure

Cost estimate without quantity structure

Marking and Releasing

Work in Progress
Integration

Procurement cycle

Integration with MM

Sales process integration with SD

Integration with asset accounting

Integration with controlling

Integration with PP
Reports

Financial statement version

GL reports

Accounts payable reports

Accounts receivable reports

Assets

Cash book reports

LSMW

Transport Management
SAP Organizational Structure

Define a Company

Define a Company Code

Assign Company Code to Company

Define Chart of account

Assign Company Code to Chart of Accounts

SAP Global Accounting Setting
Charts of Account
Allocate Company Code to Chart Of Accounts
Setup Account Groups and their Number Ranges

Assign Fiscal Year Variant

Assign Posting Period Variant to Company Code
Document Number Ranges for company code
Assign Field Status variant to Company Code
Define Tolerances for Employees
Set up Business Partners: Customer and Vendor

Set Tolerance for Customers and Vendors

Customer Account Groups

Create Number ranges for customer accounts

Allocate Number Ranges to Customer Groups

Customer Master Record

Create Vendor Groups

Create Number Ranges for vendor Accounts

Allocate Number ranges to vendor account groups

Create Vendor Master

Post a Customer Invoice

Set up Business Partners: Customer and Vendor

Clear Open Items by Incoming Payments

Post Partial Payment against an invoice

Residual Payment

Create Under / Over Payment Account

Assign Under / Over Payment Account to Process Key ZDI

Cash Discount Granted Account at General Ledger level

Assign Cash Discount Granted Account to process Key SKT

Cash Discount Taken Account Process Key SKE

Payment Within Tolerance (incoming)

Payment within Tolerance (outgoing)

Payment within Tolerance with 3% discount

Special Program
Sample Account
Configure Automatic Payment Program
Dunning
Down Payment
Down Payment Received

What is ERP ?
What is ERP ? This is normal for someone who dont know about ERP systems. ERP stands
for Enterprise Resources Planning. ERP system was originally used in manufacturing company as it has
a complicated business processes. Today, ERP system has been applied in various companies, such as
manufacturing, retail, oil and gas, banking, telecommunication, and many more. ERP software system
has an objective to integrate all of the business data and process so it can be managed in most effective
and efficient way. It reduces the redundant data and process by making all data from various business
processes in a company can be accessed by all departments of that company (of course, with an

appropriate authorization according to that companys policy). By doing so, a data only needs to be
entered once by a department that triggers it in its business process, and then it can be used by other
departments according to their business process needs.

What is ERP ?
What is ERP? (SAP, ORACLE, etc)
If an organization dont have ERP then it has to use different types pf other software.

Accounting Software
Payroll Software
Purchasing Software
Asset Accounting Software
Inventory Control Software
Sales Software
Invoicing Software
Supply chain management Software
Project management Software
Now each software have their own database and system. Mostly they are of different system and its hard
to synchronize among them all. So, One systems data can not be used by another. To flow data from one
business segment to another is pretty hard too. It may lead to possible errors if get some data
synchronization problem.
ERP software integrate all the data from all the business departments and makes assure
data synchronization in all departments. Also this data can lead to another process in another department.
With ERP software, the data integrity can be assured better, because the data only needs to be entered
by the responsible department in its business process/transaction. Then this same data can trigger

another business process/transaction in other department.For example, typical business processes in a

manufacturing company are:Demand for finished products from customer will be recorded by Sales
department in a sales order document. Sales order data can be analyzed by Inventory department. If
there are not enough finished products in current stock, with MRP function, the sales order can trigger a
planned order that can be converted to a production order that requests the Production department to
start producing the finished products. In order to produce the finished products maybe it requires some
raw materials that have to be bought from vendors. The production order can trigger a purchase
requisition for the raw materials. The purchase requisition will be processed by Procurement department
to be a purchase order that is sent to vendor. Vendor will deliver the raw materials and Inventory
department will receive them. Accounting department will record the vendors invoice and Finance
department will process the payment. Once the raw materials are available, the Production process
begins. Then the finished products will be delivered to the customer, and Finance department will send
invoice to the customer.All of business processes in the above example can be integrated in one ERP
system. The ERP system usually consist of several modules such as Customer Relationship
Management (CRM), Sales, Inventory, Production Planning, Plant Maintenance, Purchasing, Supplier
Releationship Management (SRM), Accounting, Human Resources, etc. But, all of them are in the same
platform and same database. ERP system is one of the largest software code ever written. Its so
complicated because it tries to be flexible, so it can adopt all business process in all companies. Its been
designed with a standard set of tables, transaction programs, and report programs. It also provides a
configuration/customizing program, so it can be configured / customized according to a specific business
process or company need.There are some ERP software vendors that provide an off-the-shelf ERP
System. Although they say their ERP system is off-the-shelf products, usually it cant be used /
implemented as soon as youve installed it, not like other application such as office application. Before it
can be used, we must first configure and or customize it based on our business processes and needs.
Usually, the configuration process needs expert consultant services. The consultants will map our
business process into the ERP System configuration. This process is usually called ERP Implementation
Project. This project can take months or even years, depends on its scope. After the ERP System
configured based on our needs, then it will Go Live, and ready to be used in a daily operational activities
in our company.

SAP Organizational Structure

To understand any ERP and its functions, its very important to understand its organizational structure.
SAP Organizational structure includes high level hierarchy for an organization.
Basic Organizational Structure for SAP FICO is as below:
Operating concern >Controlling area >Company code > Sales Organizations /Plants/ Purchase
Organizations
This is the basic organizational structure in SAP. It is true for FICO as well other modules such as Sales
and Distribution (SD), Material Management (MM) and Financial Supply Chain Management (FSCM) as
well.

SAP Organizational Structure

Operating Concern is the level where strategic planning designed for the organization. An organizations
strategic planning decided in operating concern. Controlling area gets assigned to operating concern.
Operational concern can be assigned to more then one controlling areas.
Controlling area maintains management accounting. Controlling area in SAP organizational structure is
the main entity in controlling organizational structure. Company code gets assigned to controlling area.
More then one company codes can use a single controlling area.
Company code is a separate legal entity for legal reporting. Company code is useful for reporting, balance
sheet , profit and loss statements and cash flow statements. Plants, sales organizations and purchase
organizations gets assigned to Company code.
Sales organization and purchase organizations are under sales and purchase departments
simultaneously. Sales organization control sales activities such as sales offices, sales persons, etc.
Purchase organization controls activities under purchase planning.Both sales and purchase organizations
assigned to company codes.
Plants assigned directly to company codes. Plants are assigned to both company codes and sales
organizations.
These were the basic structure of SAP Organizational Structure.

ASAP Methodology of SAP : 6 Phases of Implementation SAP, ERP System

ASAP Methodology, SAP Implementation road map

ASAP Methodology is the methodology to implement SAP in an organization. SAP implementation should
go in some pre defined phases. There are total 6 phases in ASAP methodology.
1)
Presales
( Presales phase of ASAP Methodology )
In this phase of ASAP methodology, SAP and other ERPs try to sell their products to the clients (i.e.
companies). And then company chooses which is more suitable for their requirements (lets say they
chose SAP, then our work starts.)
2)
Preparation
(Preparation phase of ASAP Methodology)
In this phase of ASAP Methodology, we decides Landscape information/ preparation (server info.
Cost, how many people going to use it etc.)

Team size: two teams implementation team and core team

(Project managers and steering committee from implementation team and core team together
called PMO: Project Management Organization)

As is study: study of current situation, processes, legacy system etc. This is done by core team.

As is flow chart (tools are Visio, arise etc.)

Gather all the reports

Study legacy system

Information on drawing (handled by Document Management System DMO, also by PP)

Gather information on interfaces-must have, need to have, nice to have

Document As Is

Sign off
3)
Business Blueprint
(Requirement analyze phase of ASAP Methodology)

Gather requirement for legacy

To be

GAP analysis (difference between as is and to be)

To be process flow

List of interfaces to be finalized (must have done now and need to have will be post go live)


List of reports

RICEFW objects (Reports, Interfaces, Conversion, Enhancements, Forms and Workflow)- These
are customize reports.

Functional specification- for all RICEFW objects

Technical specification

Sign off on docs above

Test scripts

Test cases

Test scenario-Simple, complicated and complex

Business process procedure (ASAP)

Using PowerPoint all functional consultant give a demo

Using PowerPoint presentation give demo only for your module (workshop)

Using 800 client give a SAP demo-800 is IDES server (IDES never have customer information)

Q&A database (to be answered by core team)

Organization structure

Collision list (material, vendor and customer, unit of measure)

To be documentation

To be sign off (consultant and project manager)

4)
Realization
(Configuration phase of ASAP Methodology)

Carry out baseline testing in 800 clients

You are provided with a new client 200

Carry out basis configuration (back end) done by consultant

Copy of configuration sent to client 300

Testing carried out in 200-300 is a golden client; no master data, just configuration so we cant do
testing in 300 (testing by core team)

You are provided with a new client 400 (basic)

Carry out additional configuration in 400 (200+400)

Copy of configuration sent to 300

Testing carried out in 400 (core team)

You are provided with a new client 600 (sandbox)

Carry out additional configuration in 600 (600+200+400)

Copy all configurations to client 300

Testing carried out in 600

Using client 600

Upload master data across all modules (sample load of few parts or entire data end as per client
wants)

All RICEFW objects must be ready tested by you and ready for testing by business

Carry out integration testing 1 in client 600 (across all modules)-simple scenario (10) and
complicated scenario (10)

Integration testing in client 600 (across all modules, group test), complex scenario (5)

Training needs and documents, identify roles and responsibility (based on SOX compliance)

Training client 910 produced by basis

5)
Pre go live phase

(Pre go live phase of ASAP Methodology)

Suggest business to clean up master data in legacy, all configurations from golden client will be
moved to 910, 960 and 999

Master data templates provided by business- if we upload just sample data before then we need to
provide templates here otherwise templates provided when entire data uploaded in previous phase)

Upload master data there are 2 tools: LSMW and interfaces (interfaces like Biz Talk, tibco, XI etc)

Training session carried out

You are provided with a new client 910 (Development server)

Master data upload into 910

Sometimes Business carried out integration testing 3

You are provided with a new client 960 (quality and integration test server)

Master data upload into 960

You are provided with a new client 999 (production server)

Master data upload to 999 (this is the live server use for business)

Cut over activities (in client 999); when to stop legacy, when to start SAP, when to run MRP,
controlled start up
6)
Post production support

Configuration change

Master data changes

Transaction level changes

Some more training

Master data to be plugged

Missing authorization

Complete all documentation work (For both configuration and end use depend upon client)

Overhead Cost Management

The Overhead Cost Controlling component (CO-OM) helps you to plan, allocate, control, and monitor
overhead in your organization
By planning in overhead areas, you can develop standards, that allow you to control costs and valuate
internal activities.
Cost Centre Accounting
Cost Center Accounting analyzes where overhead occurs within the organization
Costs are assigned to the sub-areas of the organization where they originated.
SAP offers a wide variety of methods for allocating posted amounts and quantities.
Internal Order Accounting
Internal Orders collect and analyze costs based on individual internal jobs.
SAP can monitor and automatically check budgets assigned to each job.
The SAP Controlling also known as SAP CO. Module provides supporting information to Management for
the purpose of planning, reporting, as well as monitoring the operations of their business. Management
decision-making can be achieved with the level of information provided by this module.

SAP Controlling Organization Structure

Some of the components of the SAP CO(Controlling) Module are as follows: Cost Element Accounting
Cost Center Accounting Internal Orders Activity-Based Costing (ABC) Product Cost Controlling
Profitability Analysis
Profit Center Accounting
The Cost Element Accounting component provides information which includes the costs and revenue
for an organization. These postings are automatically updated from FI (Financial Accounting) to CO
(Controlling). The cost elements are the basis for cost accounting and enables the User the ability to
display costs for each of the accounts that have been assigned to the cost element. Examples of
accounts that can be assigned are Cost Centers, Internal Orders, WBS(work breakdown structures).
Cost Center Accounting provides information on the costs incurred by your business. Within SAP, you
have the ability to assign Cost Centers to departments and /or Managers responsible for certain areas of
the business as well as functional areas within your organization. Cost Centers can be created for such
functional areas as Marketing, Purchasing, Human Resources, Finance, Facilities, Information Systems,
Administrative Support, Legal, Shipping/Receiving, or even Quality.
Some of the benefits of Cost Center Accounting :
(1) Managers can set Budget /Cost Center targets;
(2) Cost Center visibility of functional departments/areas of your business;

(3) Planning ;
(4) Availability of Cost allocation methods; and
(5) Assessments/Distribution of costs to other cost objects.
Internal Orders provide a means of tracking costs of a specific job , service, or task. Internal Orders are
used as a method to collect those costs and business transactions related to the task. This level of
monitoring can be very detailed but allows management the ability to review Internal Order activity for
better-decision making purposes.
Activity-Based Costing allows a better definition of the source of costs to the process driving the cost.
Activity-Based Costing enhances Cost Center Accounting in that it allows for a process-oriented and
cross-functional view of your cost centers. It can also be used with Product Costing and Profitability
Analysis.
Product Cost Controlling (Product Costing) allows management the ability to analyze their product
costs and to make decisions on the optimal price(s) to market their products. It is within this module of CO
(Controlling) that planned, actual and target values are analyzed. Sub-components of the module are:
Product Cost Planning which includes Material Costing( Cost estimates with Quantity structure, Cost
estimates without quantity structure, Master data for Mixed Cost Estimates, Production lot Cost
Estimates) , Price Updates, and Reference and Simulation Costing.
Cost Object Controlling includes Product Cost by Period, Product Cost by Order, Product Costs by Sales
Orders, Intangible Goods and Services, and CRM Service Processes.
Actual Costing/Material Ledger includes Periodic Material valuation, Actual Costing, and Price Changes.
Profitability Analysis allows Management the ability to review information with respect to the companys
profit or contribution margin by business segment. Profitability Analysis can be obtained by the following
methods:
Account-Based Analysis which uses an account-based valuation approach. In this analysis, cost and
revenue element accounts are used. These accounts can be reconciled with FI(Financial Accounting).
Cost-Based Analysis uses a costing based valuation approach as defined by the User.
Profit Center Accounting provides visibility of an organizations profit and losses by profit center. The
methods which can be utilized for EC-PCA (Profit Center Accounting) are period accounting or by the
cost-of-sales approach. Profit Centers can be set-up to identify product lines, divisions, geographical
regions, offices, production sites or by functions. Profit Centers are used for Internal Control purposes
enabling management the ability to review areas of responsibility within their organization. The difference
between a Cost Center and a Profit Center is that the Cost Center represents individual costs incurred
during a given period and Profit Centers contain the balances of costs and revenues.

Posting Keys

Posting Key in SAP FICO

SAP Posting Key is a 2 digit key to control line items. Posting Key config controls.

Whether the posting is debit or credit.

The type of account the entry will be made to. (G/L, Customer, Vendor, Assets, Material)
Posting key for reversal, if document is reversed.
Screen Layout Fields can be suppressed, required or optional.
Field status can be controlled using Posting Key Field status as well as Field status Group
assigned to G/L.

SAP Posting Key

Below is the list of SAP Posting Keys :
Posting keys 1, 2, 5,8, 10,11,12, 15,25,27, 31, 32, 35 and 38 are some of the most important posting
keys.
Maintain Accounting Configuration : SAP Posting Key List
Posting keyName
1
Invoice
2
Reverse Credit Memo
3
Bank Charges
4
Other Receivables
5
Outgoing payment
6
Payment Difference
7
Other Clearing
8
Payment Clearing
9
SPL G\L Debit
10
G\L postings
11
Credit Memo
12
Reserve Invoice
13
Reserve Charges
14
Other Payables
15
Incoming payment
16
Payment Difference

Debit\CreditAccount Types
Debit
Customer
Debit
Customer
Debit
Asset
Debit
Customer
Debit
Customer
Debit
Customer
Debit
Customer
Debit
G\L Account
Debit
Customer
Debit
G\L Account
Credit
Customer
Credit
Customer
Credit
Customer
Credit
Vendor
Credit
Customer
Credit
Asset

17
18
19
21
22
24
25
26
27
28
29
31
32
34
35
36
37
38
39
40
50
70
75
80
81
82
83
84
85
86
89
91
92
93
94
95
96
99

Other Clearing
Credit
Payment Clearing
Credit
SPL G\L Credit
Credit
Credit Memo
Debit
Reverse Invoice
Debit
Other Receivables
Debit
Outgoing payment
Debit
Payment Difference
Debit
Clearing
Debit
Payment Clearing
Debit
SPL G\L Debit
Debit
Invoice
Credit
Reverse Credit Memo Credit
Other Payables
Credit
Incoming payment
Credit
Payment Difference
Credit
Other Clearing
Credit
Payment Clearing
Credit
SPL G\L Credit
Credit
Debit Entry
Debit
Credit Entry
Credit
Debit Asset
Debit
Credit Asset
Credit
Inventory Taking
Debit
Cost
Debit
inventory Difference
Debit
Price Difference
Debit
Consumption
Debit
Change in Stock
Debit
GR\IR Debit
Debit
Stock inwd movement Debit
Cost
Credit
inventory Difference
Credit
Price Difference
Credit
Consumption
Credit
Change in Stock
Credit
GR\IR Credit
Credit
Stock Outwd MovementCredit

What is General Ledger (GL) in SAP ?

Customer
Customer
Customer
Vendor
Vendor
Vendor
Vendor
Vendor
Vendor
Vendor
Vendor
Vendor
Vendor
Vendor
Vendor
Vendor
Vendor
Asset
Vendor
G\L Account
G\L Account
Asset
Asset
G\L Account
G\L Account
G\L Account
G\L Account
G\L Account
G\L Account
G\L Account
Material
G\L Account
G\L Account
G\L Account
G\L Account
G\L Account
G\L Account
Material

This article gives the complete configuration required to create SAP General Ledger (SAP GL) account in
SAP-FI. This will show you the configuration for definition of Company, creation of General Ledger
account in the company code, Charts of Account (COA).
SAP General Ledger (SAP GL) is a core element of SAP FI. General Ledger comprise all the transaction
data for all the activities involved in the organization. Transaction data contains mostly Finance data. It
also comprise retained earning, payroll. General ledger is also integrated with cost centers in controlling.
Company:
It is said to be an organization or a corporate group which has one or many Company code under it. The
screen shots below will give the detailed step to define Company in SAP system. Most of the
configuration relating to SAP is done in SPRO (SAP Project Reference Object); follow the navigation
shown in the picture to Define Company in SAP, The definition of the company is shown above; The
Company is represented using a Four Digit numerical character (it can also be alphanumerical) 4623 with
the name Ketan Group of Industries.
Company Code:
It is said to be the representation of an independent balancing or legal accounting entity within the
Corporate Group which can create its own financial statements; there can be n number of company code
within a corporate group. Choose Second option to create New Company Code and First option to Copy
and create new company with all the data from an existing Company Code.
Creation of Company Code 1000: Company Code 1000 is created.
Creation of Company Code 2000: Once the Creation of Company code is done they are to be assigned to
the Company in SAP to achieve the Enterprise Structure.
Company 4623- Ketan Group of Industries

Company Code 1000- Ketan Iron & Steel

Company Code 2000- Ketan Paper Mills

What is General Ledger in SAP

Assign Company Code to Company:
The Screen shot explains the assignment of the CC 1000 & 2000 to Company 4623. Thus a basic
Organizational Structure is achieved in the Enterprise structure. Now the Financial accounting Global
setting is explained below with configuration steps and screen shots.
Financial accounting

Global Settings: The Variant Principle

The Variant Principle is a Three Step Method used in the SAP system to assign particular properties to
one or more objects, the steps are as below:
1) Define the variant,
2) Determine values for the variant,
3) Assign the variant to the object
Business Process associated with SAP FICO:

Business Process Associated with SAP FICO

Here is the list of business process associated with SAP FICO
General Ledger Accounts
Fixed Asset Accounts
Customer master accounts
Vendor master accounts
Sales Order
Sub Ledger accounts
Purchase/Procurement accounts

SAP FICO Company Code Configuration

Company Code
The first step of SAP FI configuration is to Create Company Code.
It is a unique four alphanumeric characters that represents an independent and legal accounting entity.
Its the smallest and minimum necessary organizational structure in SAP that required by law to provide a
set of financial reports (such as Balance Sheet and Profit/Loss Statements). In the real world, it can be a
company of a corporate group and in an SAP client, It can be more then one. The general ledger is kept
at company code level. For consolidation process in SAP EC module, a company code must be assigned
to a company. A company can comprise one or more company codes.

With SAP FI module, we can generate the financial reports of a company code. A company codes
financial reports are used for external purpose, such as for external auditors, shareholders/stock
exchange commission, tax office, etc.

SAP FICO Company Code

It is one of the two main organizational units of SAP FI module. The other one is Business Area. Business
areas are used for internal purpose, such as for companys management. Business areas represent
separate areas of operation within one or some companies. With business areas, for example, SAP can
generate financial reports of a specific regional area of a company.
Lets say Coca Cola Company has one company code in USA (and several others in the whole world).
With company code, SAP can only generate one set of financial reports for USA office. But, with business
areas (depends on how it configured), SAP can generate sets of financial reports per state in the USA. By
doing so, the management can analyze the performance of each branch in each state better. It gives
more useful information that can be used in decision making process. The use of Business Areas is
optional in SAP FI module.
All SAP transactions that have impact to the financial reports from all SAP modules (such as FI, MM, HR,
etc) will generate accounting journals in company codes general ledger. The transaction can determine
the company code involved either from the user input for the company code (such as in FI module) or
from other organizational unit that related to the company code (such as in MM module, company code
can be determined from the plant that input by user).
In MM module (Logistics), each plant must be assigned to a CC. It can have several plants. A plant can
also be assigned to a business area; a business area can be assigned to several plants. Material
valuation can be set at company code level or plant level.

Copy Company Code

We create company code from the following menu path of SPRO t-code: Enterprise Structure
Definition Financial Accounting Edit, Copy, Delete, Check Company Code.
There are two options:
Copy from other company code
Create from the scratch
SAP recommends that we copy a CC from an existing CC. The advantage is SAP will also copy the
existing company code-specific parameters. Then we can change certain data in the relevant application
if necessary. This is much less time-consuming than creating a new company code. But if we create
company code from the scratch then we have to define other parameters need in other relevant
configuration process manually.

Chart of Accounts :SAP COA

In SAP FICO system, after creating Company Code, the next thing we have to do is creating Chart of
Accounts (COA).In SAP R/3 term, Chart of Accounts is a unique four alphanumeric code that represents
the structure of group of General Ledger (G/L) accounts. The COA contains the definition of all G/L
accounts such as their account number, account name, and the type of G/L account (whether the account
is a Profit &Loss; /P&L; type account or a balance sheet type account).
Each company code must have one chart of accounts (COA) for its general ledger. The COA must be
assigned to the company code. A COA can be assigned to several company codes which mean that these
company codes general ledgers have the same structure.
We can define Chart of Accounts with OB13 T-code or through SPRO T-code menu: Financial
Accounting General Ledger Accounting G/L Accounts Master Records Preparations Edit Chart
of Account Lists.
The definition of COA determines some characteristics of the COA, which are:
Chart of Accounts code and its description.
The language of COA.
Length of G/L Account number of the COA (up to 10 digits, can be numerical or alphanumeric).

 Type of integration between G/L accounts and cost elements. It controls of how a cost element can be
maintained when maintaining a G/L account. A cost element classifies the companys valuated
consumption of production factors within a controlling area. A cost element corresponds to a cost-relevant
item in the chart of accounts such as expense account (a P&L; account).
The following options are available for each G/L account:
No maintenance of cost elements.
Cost elements maintained manually.
Cost elements maintained automatically. When we save a new G/L account, the related cost element is
automatically created. A prerequisite is that a default value for the cost element category has been set up
for this cost element. If no default value is found, the system will not create a cost element.
Group Chart of Accounts for consolidation process (if the general ledger of the company code will be
consolidated to the parent companys general ledger).
The status of COA: blocked or not. SAP suggests blocking COA if charts of accounts are created
centrally and accounts are created locally. If this is the case, then the block prevents accounts from being
created in the company codes for a chart of accounts that is not yet completed.

SAP Account Group OBD4

SAP Account group determine which fields you can configure on the G/L master record for SAP FICO
system.
The standard SAP require at least two account groups, one for balance sheet accounts and one of the
profit and loss accounts.
OBD4 - Define Screen layout per account group (G/L Accounts)
SAP Account group decides:

Classifying the accounts (A,D,K,M or S)

Number ranges (Internal or external)

Screen layouts (What fields are going to be populated in master record data).

SAP Account Group

account group
Next step is to create number range and assign it to account groups. We can see here vendor account
001 is assigned to number range 01. Now if we see maintaining number range for vendor in XKN1, it
shows number ranges as well whether its internal or external.

Account Group number range

G/L account groups can have number ranges overlapping each other, customer or vendor account groups
can not have overlapping number ranges.

SAP Accounts Payable (AP) outline

Accounts Payable (AP) is a very important sub module in SAP FICO main parts in SAP AP is as follows:
Master data
Invoice Processing / Logistics
Payment / Disbursements
Account analysis & reconciliation
Periodic processing
Reporting

Master data: Master data can be created at 3 levels. General data ( name, address, control data)
Company data ( reconciliation account, payment term, account management) Purchasing data ( Purchase
order currency, incoterms, purchase data, partner functions) Other master data consists of account
groups, one time vendors etc.

ACH Automatic Clearing House , Automatic

Payment Program (APP)
ACH Automatic Clearing House and Automatic Payment Program(APP) is most important in SAP
Account Payable (AP).Here are steps for ACH Automatic clearing house ACH configuration in t
code FBZP.
Automated Clearing House ACH is the process of automatic payment to vendors. By using ACH, we can
set up criteria to pay all open vendor line items. Automated Clearing House ACH configuration contains
FBZP configuration. After all configuration, one can set up parameters and criteria in F110.
ACH Automatic Clearing House Configuration:

Setup payment method per country

Setup payment method per company code

Setup all company codes

Setup paying company codes

Bank determination

Assign payment methods for vendor

SAP FBZP, ACH Automatic clearing house, Automatic payment program (APP)
We can run Automatic Payment Program (APP) through t code F110

Status:
Parameters: Vendors, Payment methods, next payment date,
Proposal:
Payment run:
Print: if check payment is configured
Electronic Bank Statement (EBS) configuration:

Create House bank & account ID (FI12)

Setup EDI partner profile for FINSTA message type (WE20)

Configure global settings for EBS

Account symbols

Assign account symbol to account

Key for posting rules

Posting rules

Transaction types

Assign transaction types for posting rules

We can get Bank Reconciliation statement through t code FF67

1. Create Company Code/nspro Screen

- Enterprise structure
- Definition
- Financial Accounting
- Edit, copy, delete, check plant
1. Copy, delete, check company code
-Copy
- From company code 3000 to company code VG01
(create your company code), enter, no, no, yes
2. Edit company Code Data
Position
- VG01 change name/select that line and go to edit address- enter-save
(Update the company information like
name, currency address, etc)
Note: The address icon in the top right corner of the screenSecond step is to create Fiscal Year
Variant : Fiscal Year Variant
2. Create a Fiscal Year Variant
/nspro Screen
(Purpose: In the below path you define your fiscal year variant that matches your company Fiscal year,
e.g.: K4)
- Financial Accounting
Financial accounting global setting
Fiscal Year
Maintain fiscal year variant (T CODE: ob29)
Position k4

- Select K4 Line
- Save
In the below path you assign your fiscal year variant to your company code.
Go back to the previous screen
- Financial Accounting
Financial accounting global setting
Fiscal Year
Assign company code (T CODE: 0b37)
Position Your Company Code
Select
Save
(Go to position and go to your company code, in the fiscal year variant column select the variant column
you defined in the previous step, e.g. k4).

SAP FICO system allows maximum of 16 periods, inducing 12 regular periods and 4 special posting
periods.
Special posting periods can be useful for posting audit or tax adjustment to a closed fiscal year. Four
special periods can be used for four quarters.

Next step is to set up Posting Period Variant :Posting Period Variant

3. Create a Posting Period Variants
/nspro Screen
- Financial Accounting
Financial accounting global setting
Document
Posting Period
1. Define Variant for open posting periods
Position 3000
Select that line
Copy
- Change variant and name from 3000 to your C. Code
Save
2. Open and close posting periods
Position 3000
Select all 3000 lines
Copy

- Change it, from 3000 to your company code

Save
3. Assign Variant to company code
- Position AJ01
Select that line
Save

Next step is to set up Document Number Range

4. Create Document Number Ranges
/nspro Screen
- Financial Accounting
Financial accounting global setting
Document
- Document Number Ranges
1. Define document number ranges
Company Code
Status (If ranges table is blank) then go.*
2. Copy and company code
Fiscal Year 2010
- Source Company code details- company code-3000
- Target company code details- company code- VG01
Execute
Next step is to set up Field Status Variant
5. Create Field status variant
/nspro Screen
Purpose:
To create your field status variant to suppress, Req. Entry or opt. Entry the fields
/nspro menu
- Financial Accountin
- Financial Accounting Global Setting
Document
Line item
Controls
1. Maintain Field Status Variant (TCODE: obc4)
- Position 3000
Copy
- Change it from 3000 to your company code
Enter
Copy all
Enter
Save
2. Assign Company code to field status variants (TCODE: obc5)
- Position VG01

- Make changes in last column with your company code

- Enter and Save
Lets check Global Parameters now.

Company Global Parameters

Check Company Global Parameters:
/nspro Screen
- Financial Accounting
- Financial Accounting Global Settings
Company Code
Enter Global Parameters (TCODE: oby6)
Position VG01
select
Details-f2
Company code
Country Key US
Currency USD
- Language key EN
- Chart of accounts CAUS
- Country Chart CAUS
- Credit Control area 3000
- Fiscal year variant K4
- Document entry screen variant 2
- Field status variant VG01
- Posting period variant VG01
- Max. Exchange rate deviation 10%
- Cost of sales accounting actv. 2
- Check Cash management activated ?
- Check Propose fiscal year
- Check Define default value date
- Check Financial assets mgmt active
- Check Purchase account processing
(Select your company and make sure the Business area fin. Statements is unchecked. Also the work
flow variant needs to be blank.)Next step is to create G/L Accounts.
7. Creating GL Account:SAP Menu
Purpose:
Creating 2 GL Accounts (Cash 110000, Revenue 800000)
- Accounting
- Financial Accounting
General Ledger
Master Records
Individual Processing

FS00-Centrally

- GL Account No.
- Company Code
- Open GL account (Top left side)
- Create with Reference
You can see:
Reference Account
GL account
# 110,000
Company Code # 3000
Click Yes
- Control Data
- Account currency USD
- Posting without Tax allowed
- Line item display
- Short key
- Save It.
Do the same thing for the GL Account: 800000Now lets post some transactions F-02 posting

8. Posting Your Transactions.

SAP Menu
- Accounting
- Financial Accounting
- General Ledger
- Document Entry
- F-02 General Posting
We have a dialogue box,
Document Date:
Type: SA
Company Code: VG01
Posting Date:
period: Current Month
Currency Rate: USD
Document Number:
Transaction date:
Psky:40 Account: 110000
(Note: 40- Debit G/L Account {Cash})
Next screen is: Account: 800000
50 Credit G/L Account (Revenue)
Document Menu > display
Save it.
Now as you guys know how to post in F-02, lets create some more Custom G/L Accounts

Create a Custom GL Accounts.SAP Menu

- Accounting
- Financial Accounting
- General Ledger
- Master Records

- Individual Processing
- FS00 Centrally
Create all the following accounts in T code fs00,
110000 Cash
800000 Revenue/Sales
2000 Building
1000 Land
22000 Furniture
70000 Common Stock
140001 Trading Receivable Domestic
160001 Trade Payables Domestic
160030 Trade Payables
466000 Insurance
470000 Building Rent
473000 Postage
476000 Office Supplies
417000 Purchasing Services
435000 Annual Bonus
451000 Building Maintenance
452000 Machinery and equipmentNow lets post some more transactions in these accounts in F-02 GL
posting
G/L Transactions or Posting:
SAP Menu
- Accounting
- Financial Accounting
- General Ledger
- Document Entry
-General Posting (TCODE: F-02)
Enter the postings for the following transactions (Here you can be creative and use accounts and
amounts to your liking)
1.
Setup business to $100,000
40-Db. Cash (110000)
$100,000
50-Cr. Common Stock (70000)
$100,000
2. Buying Land for $50,000 on Cash
40-Db. Land(1000)
$50,000
50-Cr. Cash (110000)
$50,000
3. Bought Furniture for $25,000 on Credit
40-Db. Furniture (22000)
$25,000
50-Cr. Trade Payable (160030)
$25,000
4. Expenses
40-Db. Postage (473000)
$10,000
40-Db. BuildingRent (470000)
$3,250
40-Db. Purchased Services (417000) $15000
50-Cr. Cash (110000)
$28,250

5. Sales
40-Db. Cash (110000)
50-Cr. Sales (800000)

$50,000
$50,000

SAP APP : Automatic payment program steps for SAP FICO system are
Setting up payment method per country
Setting up payment method for company code
Setting up all company codes
Bank determination
Assign payment methods for vendor account
The process for SAP APP are:

Parameters- F110: System identify given payment run by date and identification. It is unique

combination for the given payment. In the parameters field, give the company codes for which you want
to run Automatic payment. Give payment method based on your payment method. For example, for
check payment C and for wire transfer its T.Give next payment date. ( Why next payment date? : So it
will consider all the transactions till that date for the payment run. ). We can also restrict the selection
by document types, customer master and vendor master record in free selection tab. Maintain log for
the proposal in additional log tab. Save printer information in printout/data medium and save
the parameters. It shows the status of parameters in status tab.
Proposal Run- F110: There is a tab Proposal on the top in F110 when you select status tab.

Click proposal and gives starting date and time or start immediately. It will show proposal in some time.
Proposal list can be seen through proposal log tab. We can see the proposal list in edit> proposal >
proposal list. Also we can edit the proposal if needed.
Payment Run-F110: Run the payment run by hitting payment run tab. we can set up time to run it

in SAP FICO system. System will show all the payments done in tab edit > payment> payment list
Print check: Once we run the printout, SAP FICO system will go ahead and print out all the
checks and create documents for banks. RFFOUS_C is the program for check printing.

Type of Assets : Asset Management in SAP

Fixed asset in asset management comprise of various asset types. As per balance sheet there are three
classes:

Intangible assets

Fixed assets

Financial assets
In general we need to be more specific about asset types.
Here are some of the asset types.
Assets under construction:
It is a form of tangible assets. Its usually been shown as separate balance sheet item and so it need
separate account determination in their asset class.
We can manage assets under construction as separate separate master record just as we do for
completed assets.
We also can put more than one asset under constructions in one master record.
Once the assets gets completed we can distributes to proper assets via

Line item settlement

transfer to other asset master record

Leased Assets:
Leased assets need special accounting requirements. Leased assets remains leasers property. Leased
assets are responsibly of lessor and shouldnt be used to assess the asset portfolio value of lessee.
We can use two approach while handling accounting entries of leased assets.

We can capitalize and depreciate some leased assets as Capitol lease.

Here is the accounting entries for leasing assets in Capitol leasing.

SAP Asset Management

Second option is we can handle it as periodic rent expense and flow into profit and loss statement
as Operating Lease
Here is the accounting entries for leasing assets in Operating leasing.

SAP Asset Mangemenet

Intangible Assets:
Intangible assets such as patent can be managed the same way as tangible assets.

Depreciation methods

Here is a example of the depreciation methods and different methods:

Suppose a piece have acquisition and production value of $1000, life value is 10 years and scrap value is
$2000
Straight line method without basis reduction:
Cost/life > $10000/10> $1000
Straight line method with basis reduction:
(cost-scrap value)/life = $800
Diminishing balance method:
%=1/life= 10%
For 1st year its $1000 and net book value is $9000
For 2nd year its 10% of NBV of first year that is $900 and net book value for second year is $9000-$900=
$8100
Accumulated depreciation for first year is $1000, for second year is $1900 etc.
Document Parking:
Document parking is a functionality SAP system gives so a user can park a document while he or she is
doing something else. Suppose you have a clerk and he is not authorized to post due to company policy.
SAP System allows to complete transaction but park it instead of post it. His supervisor ( who is
authorized) can see the post, change it if he wants or post it if all correct. This function is important in SAP
FICO.
Document parking allows users to do their transaction and then park the document for the upper level or
other users who can do posting after reviewing the document.

Currency in SAP FICO

There are mostly three type of currencies in SAP FICO
Company code currency
Parallel Currency
Group currency

If the account currency is same as the company code currency, then you can post to that GL account in
any transactional currency. But if Account code currency is different from the company code currency,
SAP system thinks that, the GL account is foreign currency GL account and hence should be able to be
posted only in that foreign currency of that GL account and not in any other currency including its own
company code currency.
For example if a company code currency is USD and GL account currency is also USD then we can post
in any transaction currency. But if company code currency is in USD and GL account currency is in EUR
then we can post to that GL only in EUR not in any other currency, not even in USD.

Electronic Bank Statement (EBS)

To set up Electronic Bank Statements (EBS)
1. Create House Bank and Account ID (FI12)
2. Setup EDI Partner Profile for FINSTA Message Type (WE20)
3. Configure Global Settings for EBS (IMG)
Create Account Symbols
Assign Accounts to Account Symbols
Create Keys for Posting Rules
Define Posting Rules
Create Transaction Types
Assign External Transaction Types to Posting Rules
Assign Bank Accounts to Transaction Types
4. Define Search String for EBS(Optional)
Search String Definition
Search String Use
5. Define Program and Variant Selection
In SAP FICO, F-53 kept the line items open even if it got paid. How to clear them? Through F-44.
Here in F-44, give the vendor account number whom we want to clear line items. Process open items will
redirect to the new screen. Select which line items to be cleared, simulate and save. It will clear the line
items and gives a document number. Upon displaying document it shows a document with no line items
but just header data.
It is an important certification question that only clearing document display have just header data and no
line items.
All the financial accounting entries saved in tables BKPF and BSEG for header data and line item data
respectively. So for most of the documents there is a link between these two tables, but for clearing
document there is an entry in BKPF only.

F-44 Manual clearing of vendor account in SAP

Field Status
Field status appear at four different levels in the systems:
The Account groups: This will dictate how master data is created.
The G/L account: This will dictate what kind of data is required while processing transactions in G/L
against this account.
The posting key: This has an impact on how entries are processed from a debit versus a credit
perspective.
The activity: Here the system controls what fields are required when using different transactions/
activities in the system.
Generally there are four options when dealing with Field status.
Required: The system will not permit the transaction to be complete until there is a valid entry in the field.
Optional: An entry is permitted.
Display : This field can be seen, but no editing is allowed.
Suppressed: The field is not even visible to the end user.

SAP FSCM : Financial Supply Chain

Management

SAP FSCM (Financial Supply Chain Management ) is a part of SAP Finance.

It consists mainly four parts:
1)Biller Direct,
2)Credit Management,
3)Collection Management,
4)In House Cash management
These four parts of SAP FSCM combine easy supply chain management all together.
Biller Direct gives insights of how a customer can directly pay through online using SAP FSCM.
Credit management deals with overall credit exposure and risk management of a business partner.
Collection management also known as dispute management. This submodule deals with collection and
disbursement of business partners.

Intercompany transactions
Intercompany Transactions:
Suppose you have two company codes NY and CA
Now for any transactions of NY company code, CA is paying. How the transaction is going to post in both
company codes.For example, CA company code is 1000 and NY company code is 2000. CA pays $2000
on behalf of NY
If we post just first line and last line, SAP system will bring two other lines ( yellow lines) upon simulating it
one more time.

Intercompany

Intercompany transaction

Intercompany transaction

intercompany transaction
From where these two lines gets populated and how SAP, how does system know these account? Its
from SAP FICO configuration. In spro, Financial accounting > G/L > business process > prepare cross
company code transaction.
SAP tax procedure :Assign tax procedure to country (OBBG):
SAP Tax procedure assign to the country in which the company code exists.

SAP tax procedure

SAP tax calculation procedure

How SD document determine tax codes ?
1. Several tax related condition types are configured in the pricing procedure. For example, UTXJ Tax
Jurisdiction. Code, JR1 State Tax and so on. The system determine the pricing procedure using
document pricing procedure and customer pricing procedure.
Condition type UTXJ is specifically used in USA which will be an interface condition type where VERTEX
is used. MWST is an output tax can be used where there is a sale in Europe, and can be applied where
ever necessary.
2. Condition type UTXJ is used to determine the tax codes. Go to transaction VK13 and enter UTXJ. A
pop-up window with three key combination will appear. Choose the third option Domestic Taxes. Enter
country US and execute the program, the detail screen shows how the tax codes are determined
according to customer tax class and material tax class.

SAP domestic tax codes

The customer tax class and material tax class are stored in customer master and material master
separately. In my test example, both value are 1, so the tax code should be O1 according to the condition
record.
3. Go to IMG path: SAP Customizing Implementation Guide -> Financial Accounting (New) -> Financial
Accounting Global Settings (New) -> Tax on Sales/Purchases -> Basic Settings -> Check Calculation
Procedure. Choose condition type JR1, Choose Records for access button.

Enter Country US, Tax Code O1 and Tax Jurisdiction GA0000000 and execute the report. The tax rate
is 4% which is the same percentage in the sales order. Technically, the condition table is A053 Taxes via
Jurisdiction Code.

In next post, I will try to explain how the tax amount is posted to corresponding G/L account.

Finance Terminology
Finance Terminology : Terms frequently used in SAP FICO
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 selfcontained 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 enterprises 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 organizations 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

SAP Vertex Integration

Vertex
It is a third party tax solution for SAP FICO. Usually it gets integrated with SAP system using RFC.It gives
integrated solution for various kind of tax such as income tax, sales tax, consumer use tax, value added
tax (VAT), payroll tax etc.
It is a tax compliance software which makes sure tax compliance for income tax, corporate tax, VAT,
service tax, use tax and other types of taxes. It gets integrated with SAP FICO system and automatically
calculates tax liabilities to government.
Data flow:

SAP Vertex dataflow

SAP VERTEX O-Series Integration:
We do need tax procedures and pricing procedures for integration.
Tax procedure: For this purpose, we need to create a new tax procedure based on SAP country
templates with Vertex tax conditions. Tax procedure assigned to country for output and input tax.

Vertex tax procedure

Pricing Procedures: We can defined new or use existing pricing procedure with Vertex defined condition
types.

Tax interface configuration:

External tax interface is appended to receive and pass data between VAT O series and SAP
SAP code need to be changed to enable other countries to call the external tax interface.
Change:
Vertex O series and SAP interface component (SIC) must be installed for the SAP tax interface Remote
function call (RFC). Establish the communication through RFC and transnational RFC.

RFC destination:
Program ID links RFC to SIC.

vertex RFC destination

SIC:
SIC links RFC to Vertex O series.

SIC link RFC to Vertex O series

It helps automating tax solution for any organization. It can automate tax system as well provide accuracy
and smooth processing. It automates mostly every aspects pf personal property tax, corporate tax,
compliance cycle and other management efforts. With vertex, its easy to get up to date tax data so an
organization can stay informed about it . Moreover, it provide complete set of tools to help in consumer
tax liability and audit purposes.

AP FICO Check configuration

SAP FICO Check configuration Transaction codes:
FCH1: Display check information
FCH2: Display for payment document
FCH3: void checks
FCH5: Create manual checks
FCH7: Reprint checks
FCH8: reverse check payment

FCHN: Check register

FCHT: Assignment to payment