SAP Financial Accounting FI

Dr. Djamal Ziani

King Saud University

FI Overview

FI

APAP

ARARAMGLGL

CONSpecialLedger

FI: Financial Controlling module

• GL: General Ledger

• AM: Asset Management

• AR: Account Receivable

• AP: Account Payable

• CON: Controlling

G/L Reporting Legal or external reporting• Balance sheet• Income Statement• Statement of

Financial Position

Financial Accounting

Stockholders

Bankers, Lenders

IRS, Taxing AuthorityIRS: Internal Revenue Service

External Auditors

SEC: Securities and Exchange Commission

Financial Accounting

External Accounting

Balance Sheet

Profit & Loss

Financial Position

Internal management reportingReports by cost centers or other cost “objects” and cost elements

Cost centersOrders and ProjectsBudget/planActual vs. plan

CO Reporting

Controlling

Controlling

Internal Accounting

Departmental ExpenseReport

Salaries 10,000Overhead 8,000Other 5,000Total 23,000

Department Managers

ControllersExecutives

Senior Management

FI and CO comparison

COFI

Legal or external reportingReports by accounts Balance Sheet Income Statement

Internal managementreporting

Reports by cost centers andcost elements

Cost Center Reports

FI/CO Organizational Structures

• Client• Company• Chart of Accounts• Company Code• Business Area• Credit Control Area• Controlling Area

Client

• Highest hierarchical level in an SAP system

• A complete database containing all the tables necessary for creating a fully integrated system

• Master records are created at the client level

Company

• Consolidated financial statements are created at the company level

• A company can include one or more company codes

Chart of Accounts

• A listing of the accounts

• A chart of accounts must be assigned to every company code

• Several company codes can use the same chart of accounts

Co code1000

Co code2000

Co code3000

Co code4000

Co code5000

US CHART OFACCOUNTS

GERMAN CHART OFACCOUNTS

CLIENT

CLIENT

COMPANY COMPANY

CHART OF ACCOUNTS

CHART OF ACCOUNTS

COMPANY CODE COMPANY CODE COMPANY CODE

Company Code

• A required structure• A legally independent entity• The smallest organizational unit for which

accounting can be carried out• The level where business transactions are processed • The level where accounts are managed • The level where legal individual financial statements,

such as the balance sheet and the profit and loss statement, are created

A BALANCED SET OF BOOKS

CLIENT

CHART OF ACCOUNTS

CHART OF ACCOUNTS

COMPANY CODE

COMPANY CODE

COMPANY CODE

COMPANY COMPANY

CREDIT CONTROL AREA

CREDIT CONTROLAREA

Credit Control Area

• An organizational unit or area of responsibility created to control customer credit limits

• A company code is assigned to one and only one credit control area

• Multiple company codes can be assigned to one credit control area

CLIENT

CHART OF ACCOUNTS

CHART OF ACCOUNTS

COMPANY CODE

COMPANY CODE

COMPANY CODE

COMPANY COMPANY

CONTROLLING AREA

CONTROLLING AREA

Controlling Area

• An organizational unit defining the company's cost/ managerial accounting operations

• A company code is assigned to one and only one controlling area

• A controlling area can have multiple company codes assigned to it– This allows cross company cost allocations and

reporting

1 2 3 4 5 6 7

JANUARY

FEBRUARY

DECEMBER

Fiscal Year VariantFiscal Year Variant•Determines the fiscal year

•Calendar year or non-calendar year

•Allows the use of special periods to aid year-end closing •Is assigned to a company code

The functional Components of FI

FI-GLFI-GL

FI-ARFI-AR

FI-APFI-AP

FI-AAFI-AA

General LedgerGeneral Ledger

Accounts ReceivableAccounts Receivable

Accounts PayableAccounts Payable

Asset AccountingAsset Accounting

FI-SLFI-SL

FI-LCFI-LC

Special Purpose LedgerSpecial Purpose Ledger

Legal ConsolidationLegal Consolidation

General Ledger G/L

•A ledger contains the accounts of an accounting system. Historically the ledger was a book where the accountant wrote into the postings.

•The main ledger of an accounting system is the general ledger. The general ledger (G/L) contains all accounts of the accounting system.

•All other ledgers are subsidiary ledgers (subledgers) of the general ledger. The SAP system contains:

accounts payable,accounts receivable andasset accounting.

Accounts Receivable / Accounts Payable

CustomersCustomers VendorsVendors

General General ledgerledger

Accounts Receivable Accounts Payable