SAP FI (Financial Accounting) Module and Concepts

SAP FI (Financial Accounting) Module and Concepts

SAP FI (Financial Accounting) deals with external and institutional accounting, while SAP Controlling is a module responsible for internal accounting. Data generated in other SAP modules are aggregated into FI modules; they are sometimes referred to as core modules. Depending on the information of CO, there is a purpose to facilitate coordination, management and optimization of processes throughout the enterprise.

SAP FI module deals with activities of finance department. By using SAP ERP software organization can reduce manual error and challenges occurring while recording of transaction. Most activities in SAP FICO are manual and they are automated. There is more accuracy in data as less manual action is required. SAP ERP also provides facility like integration with other departments.

SAP enables organization to generate various financial reports for an effective comparison.

Company Code

Company code is an organization created under SAP ERP or which financial statements are to be carried out. Trial Balance, Profit & Loss, Balance sheet etc can be created as per the requirement to measure and compare performances.

Business Area

In SAP FI business area business area is an organizational unit and is used for external and internal reporting.

Chart of Accounts (CoA)

CoA is a list of general ledger accounts created under each company code for a particular organization. One company code will have only one Chart of Accounts.

There are three types of CoA

  • Country specific CoA
  • Operating CoA
  • Group CoA

Fiscal Year Variant

Fiscal year is assigned as a variant In SAP. One can define 16 posting periods in this variant. Out of this 12 are regular and 4 are special period which is used at the time of tax adjustments and auditing.

Field Status Variants (FSV)

FSV are fields used for entering profit centre, cost centre, plant, etc. SAP provides this tool to assign same kind of properties to more than object. Same FSV can be assigned to more than one company code and it will show the same properties to more than one object.

SAP Enterprise Structure

When organizations opt for SAP ERP and implement it an enterprise structure has been created. This enterprise structure is planned according to nature of business and its requirement.

Significance of Tolerance Group

Tolerance group is used for residual item and payment variances arising at the time of payment. With help of these groups one can give permission, authority and limit to the user for posting a document.

Posting Keys

Posting keys are used while posting an accounting transaction in SAP. These keys are used for specific business transaction and are of double digits. SAP ERP has many predefined posting keys.

Posting Period Variant (PPV)

PPV controls the posting of an accounting transaction in a particular accounting period. By activating this option we can open and close the periods for recording transactions.

SAP is an ERP package which is made by SAP AG. ERP package is a software package for comprehensively managing mission-critical operations not for each division, in order to make effective use of corporate management resources and make management relationship more efficient.

Retained Earning

For retained earnings a general ledger master is created under SAP FI. This is a balance sheet item and part of shareholders’ equity.  This account created under balance sheet and is linked with ev.ery profit & loss account.

SAP Finance Important Transaction Codes  
FBKP Accounting maintenance
FBN1 Accounting Document->Number Ranges
FBZP Payment Program Configuration
FI12 Change House Banks / Bank Accounts
OB05 Accounting clerks T001S
OB13 Chart of accounts T004
OB29 Fiscal Year Variants
OB37 CC -> Fiscal Year Variant
OB32 Assign Co.Code -> Credit Control Area
OB52 Posting periods T001B
OB57 User ->Tolerance group T043
OB62 CC->chart of accounts T001
OBA3 Tolerances Vendor / Customer
OBA4 Tolerance groups T043T
OBA7 Document types T003
OBAS Vendor acc. gr.->Number Range T077K
OBBO Posting periods: variants T010O
OBBP CC->Posting periods var. T001
OBC4 Field Status Variant T004V
OBC5 CC -> Field Status Variant T001
OBD 3 Account groups: Vendor T077K
OBD4 Accounts -> Account groups T077S
OBY6 CC global data T001
OX02 Company Code
OX06 Controlling area
OX16 Assign Company Code -> Company ID
OY 04 Decimal Places for Currencies
OY 07 Countries: Global Parameters
OY17 Countries: Field Checks
OB08 Exchange Rate (TCURR)
OB07 Exchange Rate Types (TCURV)