1. Phase I: Financial Accounting
SAP University Alliances
Version 2.2
Authors Simha Magal Stefan Weidner Tom Wilder
Phase I: Financial Accounting
Product
SAP ERP 6.0 EhP4
Global Bike Inc.
Level
Beginner
Focus
Configuration: Financial Accounting

2. Agenda
Enterprise Structure
Business rules and parameters
Master data
Process execution (testing)
Exercises

3. Enterprise structure elements
Client
Financial accounting
Company code
Business area
Management accounting
Operating concern
Controlling area
Fulfillment
Credit control area
Define / Maintain
Including some parameters
Assign

4. CO-PA CO-PCA, CO-OM, CO-PC FI SD, MM, PP, etc. Enterprise Structure
Operating Concern
Controlling Area
Company Code
S-Org P-Org Plant, etc.

5. Used to represent a legal entity
Company Code
Used to represent a legal entity
Key organizational level for financial accounting
Books are maintained at the company code level
Financial statements are generated for company codes

6. Company Code
One for each legal entity
One for each country
Buick
Cadillac
Chevrolet
GMC
Shanghai GM
GBI USA
GBI Germany
GBI Australia

7. Internal divisions of the enterprise
Business Area
Internal divisions of the enterprise
Define areas of responsibility
Financial statements are generated for business areas

8. Operating Concern & Controlling Area
Company Code
Controlling Area
Operating Concern
GL00
NA00
US00
NA##
US##
Operating Concern:
Relevant to profitability analysis
Represents external market segments
Several controlling areas can be assigned to operating concerns
Controlling Area
Organizational level in controlling
Costs are allocated within a controlling area
Several company codes can be assigned to a controlling area

9. Responsible for customer credit Centralized
Credit Control Area
Responsible for customer credit
Centralized
Once CCA for the enterprise
Decentralized
Multiple CCA for the enterprise
Example: North America, Europe, Asia
Company Code
Credit Control Area
Enterprise
GBI
GL00
US00
DE00
GL##
US##
DE##

10. Agenda
 Enterprise Structure
Business rules and parameters
Master data
Process execution (testing)
Exercises

11. Business Rules and Parameters
Global parameters (for CC)
Account groups
Field status variants
Posting periods
Number ranges
Tolerance groups

12. Business Rules and Parameters
Global parameters (for CC)
Chart of accounts
Credit control area
Fiscal year variant
Define accounting fiscal year
Create normal posting periods
Create special periods for adjustments
Account Groups
Groups accounts with similar characteristics
Define field status
Field status variants
ZEXP: Expense accounts
ZGBS: General Balance Sheet Accounts
ZMMA: Material Management GR/IR Accounts
ZRAA: Reconciliation Accounts
ZREV: Revenue Accounts
Demo
Note: FI global settings->Ledgers->Fields

13. Business Rules and Parameters
Posting Periods
Define periods
Assign periods to CC
Close past periods
Document number ranges
For various documents
Tolerance groups for employees
Posting limits

14. Agenda
 Enterprise Structure
 Business rules and parameters
Master data
Process execution (testing)
Exercises

15. Master Data
Chart of accounts
General ledger accounts
Subsidiary (sub)ledgers
Cost elements
Cost centers
Statistical key figures

16. An orderly definition of accounts in the general ledger
Chart of Accounts
An orderly definition of accounts in the general ledger
Three types of chart of accounts:
Operative COA
Country-specific COA
Group COA
Multiple charts of accounts exist
US (CAUS) , Germany (GKR), Canada (CANA)
Country specific to meet reporting requirements
International Chart (INT)
IFRS

17. One COA can be used by multiple company codes
Chart of Accounts
One COA can be used by multiple company codes
Different GM companies (Buick, Cadillac, GMC) can use the same (US) chart of accounts
Shanghai GM will use the Chinese chart of accounts
A company must use at least one chart of account
Can use more than one chart of account to create alternate ledgers

18. General Ledger Accounts
Used to record all accounting impact of business transactions
Groups
Retained earnings account
Balance sheet accounts
Income statement accounts
Reconciliation accounts
Data in the general ledger accounts are segmented by organizational level
Chart of account segment
Company code segment
General ledger = COA data + Company code data

19. Master Data: General Ledger Accounts
Demo
Show available chart of accounts
Show examples of GL accounts
Show segments of data

20. Master Data: Sub-ledger and Reconciliation Accounts
Subsidiary Ledgers
Are not part of the general ledger.
Used to separate accounting for customers, vendors, and assets
Reconciliation Accounts
Are general ledger accounts
Cannot be posted to directly
Maintain the sum of the postings in sub-ledgers
Are specified in the definition of the sub-ledger
Sub ledger account
Reconciliation account
Customer
Accounts Receivable
Vendor
Accounts Payable
Asset (specific)
Assets
Demo
Show sub ledger accounts
Show connection between sub ledger and GL (Customer <--> AR)
Show non-reconciliation AR and AP accounts

21. Master Data: Sub-ledger and Reconciliation Accounts

22. Master Data: Cost Center
Location where costs are incurred
Department, individuals, special projects
Examples
Copy center
Security department
IT Help desk
Cost bucket used to accumulate costs
Typically Overhead costs
Payroll
Rent
utilities
Responsible for cost containment
Accumulated costs are then “charged” to other cost centers
Many processes have “orders”
Purchase orders, Production orders, Sales orders
Expenses can be charged to these orders
Collectively objects that can absorb costs are called controlling objects

23. Master Data: Cost Center Hierarchy
Demo
Cost center hierarchy

24. Associated with expense accounts in G/L
Cost Elements
Primary Cost Element
Associated with expense accounts in G/L
All postings in the G/L expense account are also (automatically) posted in the corresponding cost element
Payroll, rent, utilities, etc
Typically uses the same number as G/L account
Secondary Cost Element
Secondary cost elements are defined only within CO and do not have a corresponding G/L account
Used for internal cost allocation among cost centers
Example:
Primary: Electricity, Gas, Water
Secondary: Utilities

25. 500 500 500 Posting in FI and CO FI CO Supplies Expense Bank Account
Debit
Credit
Debit
Credit
PCE
500
500
500
NAAD1000: Administrative
Costs

26. Master Data: Statistical Key Figures
An allocation base for cost allocation between cost centers
Measurable quantity
Number of employees
Square feet
Miles driven
Minutes of time (phone call)
Used in periodic allocations and distributions (CO processes)

27. Agenda
 Enterprise Structure
 Business rules and parameters
 Master data
Process execution (testing)
Exercises

28. Process execution (Testing)
Recording of value flows ($$) as a result of other processes and transactions
General Ledger Accounting
G/L postings for rent, utilities, wages, etc.
Accounts Payable Accounting
Part of the procurement process
Accounts Receivable Accounting
Part of the fulfillment process
Asset Accounting
Acquisition, depreciation, retirement
Processes are executed to test the configuration
General Ledger Accounting in this Phase
Other testing will occur in later phases

29. Agenda
 Enterprise Structure
 Business rules and parameters
 Master data
 Process execution (testing)
Exercises

30. 1.1 - Enterprise Structure 1.2 - Business Rules and Parameters
Exercises
1.1 - Enterprise Structure
Configure the enterprise structure
1.2 - Business Rules and Parameters
Define Business Rules and Parameters
1.3 - Master Data
Create needed master data (copy from 00 where possible)
1.4 – Process Execution (Testing)
Post several G/L transactions
Appendices
Exercises provide detailed instructions for one or few objects (e.g., once cost center, once vendor, etc.)
Appendices provide data from additional objects (cost centers, etc.)
Don’t forget them!!!!

31. Exercises I.1.1: Define Company Code 3 I.1.2: Define Business Area 5
Enterprise Structure
Rules and Parameters
Master Data
Process Execution
I.1.1: Define Company Code 3
I.1.2: Define Business Area 5
I.1.3: Define Empty Chart of Accounts 6
I.1.4: Maintain Controlling Area 7
I.1.5: Define Credit Control Area 8
I.1.6: Define Variants for Open Posting Period 9
I.1.7: Define Field Status Variants 10
I.1.8: Enter Global Parameters 11
I.1.9: Assign Company Code to Controlling Area 12
I.1.10: Assign Controlling Area to Operating Concern 13
I.1.11: Define Standard Hierarchy 14
I.1.12: Assign Permitted Credit Control Areas 15
I.1.13: Maintain Company Code for Materials 16

32. Exercises Configuration Step Explanation Navigation
Description: In this task, you define your own company code in the United States. The company code is the organizational unit that allows you to structure your enterprise from a financial accounting perspective. A company code possesses information that is important for financial accounting purposes. For example, each company code is assigned to exactly one country.
Warning: See “General Notes and Cautions” about table locks.
Navigation

33. Exercises Tasks and Data Entry Enter value as specified
(except for ##)
e.g.: US05, Dallas
Find and enter appropriate Code/Value
e.g.: US, USD, EN
Tasks and Data Entry

34. Exercises A note about ## vs. ### Examples
User IDs have three digits at the end: GBI-###
Configuration can only have 99 users : 01, 02…..99
Exercises reference ##.
Substitute the last two digits from their UserID
User GBI-034 will use 34
Examples
Controlling area (North America: NA## -> NA34)
Company code (US company: US## -> US34)
Business area (Bicycles: BI## -> BI34)
Credit control area (Global: GL## -> GL34)
Exception: Operating concern (GL00 for everyone)
Technical reason for not using GL##
Operating concern is a cross client change

35. Exercises Two versions Student version Instructor version
Includes screenshots
Notes (need to add more; you can help!)
Cautions and warnings (need to add more; you can help!)
Don’t give these to students

36. Agenda
 Enterprise Structure
 Business rules and parameters
 Master data
 Process execution (testing)
 Exercises