SAP FI - GL

1. SAP FI General Ledger1 www.indiantaxhome.com

2. Table of Contents  GL Overview  Sub Processes Master Data Transaction Processing Account Analysis / Reconciliation Periodic Processing Reporting 2 www.indiantaxhome.com

3. SAP Modules - Overview SD FI Sales & Financial Distribution Accounting MM CO Materials Controlling Mgmt. PP AM Product Fixed Asset Planning Mgmt. QM Quality SAP R/3 PS Project Mgmt. System PM OC Plant Maint. Office & Comm. 3 HR IS Human Industry Resources Solutions www.indiantaxhome.com

4. FI – Financial Accounting Modules FI - Financial Accounting Modules General Ledger GL Special Ledger Accounts Payable SL GL AP Legal Accounts Receivable Consolidation LC FI AR TM CM Travel Management AM Cash Management & 4 IM Asset and Investment Management www.indiantaxhome.com

5. Financial Accounting / Controlling  Financial Accounting • Legal / Statutory Accounts • Standard Ledgers • Master Data Integrates with Controlling  Controlling • Management Accounts • Manage Budget Expenditure 5 www.indiantaxhome.com

6. General Ledger - Integration 6 www.indiantaxhome.com

7. A Group Hierarchical StructureCompany A Group A Grp CommonChart of Accounts Chart of Accounts (YCCA) Company Codes A Ltd (9100) A1 Ltd (9200)Financial Management Area A Grp FM Area 7 )9100( www.indiantaxhome.com

8. Chart of Accounts  The Chart of Accounts • Contains the definitions of COA all G/L accounts in an “YCCA” ordered form • Each general ledger is set up according to a Chart of Accounts • Many company codes may use the same COA 8 • All A Grp. organizational units use the same Chart of Accounts: YCCA. www.indiantaxhome.com Company Code Company Code 9100 A Ltd 9200 A1 Ltd

9. Company Code Company Code • It is an independent accounting entity. A company code is assigned to a chart of accounts. • Each company code in A Group uses the G/L accounts from only 9 one chart of accounts for account validation. This is called the operating chart of accounts. www.indiantaxhome.com • A chart of accounts can be used by multiple companies provided they have the same basic account requirements.

10. General Ledger Process Overview FinancialAccounting General Ledger Master Transaction Account Periodic Reporting Data Processing Analysis & Processing Reconciliation 10 www.indiantaxhome.com

11. Master Data Account Groups Maintenance • Creation at 2 Levels • Chart of Accounts Data • Company Code Data • Change • Block • Delete Cost Elements • Creation 11 www.indiantaxhome.com

12. GL Account Groups A Grp COA Number Ranges YCCA AA 120001 120299 Fixed Assets Accounts YCCA CASH 110000 118999 Liquid Funds Accounts YCCA EXP 400000 499999 Expense Accounts YCCA G.BS 100000 399999 General Balance Sheet Accounts YCCA MAT 100000 899999 Material Management Accounts YCCA REV 12 800000 899999 Revenue Accounts www.indiantaxhome.com Account Groups

13. GL Account Master Record General Ledger Balance P&L Balance P&L T T T T T T T T T TChart of T T T T T T T T T T Acct number: 119430 t : T T T T TT T gm upaccounts Description: T T T l M ro ia gsegment Inventory – Finished goods er nt at u M cco A Bal. sheet acct: )Balance c/fwd( ol r Inc. statem. acct: tr be nc n m r e co u ta fe g t n da un e er os o th P cc Company re tin O t. a Au ank 13 code B • Currency • Item management • Tax-related • Posting control... segment www.indiantaxhome.com

14. Blocking of G/L AccountsG/L Accounts are blocked at two levels • Chart of Accounts level • Company Code levelIn Chart of accounts you block • A master from creating in the Company Code • An account for postingIn Company Code you block • An account for posting 14NOTE: You can set or cancel the posting indicator at any time www.indiantaxhome.com

15. Mark G/L Accounts for DeletionG/L Accounts are not physically deleted without takingpreparatory steps • Mark it for Deletion • Specify that record must be archived • Archive the transaction data attached to that master record • Execute the G/L deletion program 15 www.indiantaxhome.com

16. Cost Elements – Chart of Accounts A Grp. Chart of Accounts - YCCA Financial Accounting 1 2 3 4 8 Assets Liabilities Equity Expense Revenue accounts 1 2 3 4 8 9 Current Non- Material financial opera- inventory Primary Revenue cost Secondary ting elements cost elements elements 16 assets costs, and revenue short- term capital Controlling www.indiantaxhome.com Profit Center Accounting

17. The Cost ElementCO FI Primary cost elements G/L accounts Primary cost element External order settlement P&L Balance sheet accounts accounts Secondary cost elements Expense accounts Accounts posted to directly, such as Internal activity allocation bank accounts Assessment Overheads Internal order settlement Accounts posted 17 to indirectly, such as reconciliation Revenue elements accounts www.indiantaxhome.com Revenue element Revenue account Sales deduction

19. Transaction Processing SAP R/3 supports the following transactions: Journal (JV) Processing • Document Principle • Document Structure Foreign Currency documents Parked documents Posting with Reference Reversing / Canceling documents 19 www.indiantaxhome.com

20. Document Posting: Activity Flow Create G/L Create G/L Posting Post Manual account posting Fast Entry Journal Holding an incomplete document Simulate No (Enough Info to Complete Posting?) Create/Display a Parked Document 20 Yes Posted Entry Post/Release a www.indiantaxhome.com Parked Document

21. The Accounting Documents Document No: 123456 Header Date: 6/5/1000x Company Code: 5200 Currency: US$ ,,,, Debit Credit 1,000,000 800,000 Line items 200,000 Total: 1,000,000 1,000,000 21 Each document consists of two segments: header and line items. After posting it receives a unique document number. www.indiantaxhome.com A Grp. will use the standard document types of SAP. The system assigns the document numbers automatically.

22. Document Number Ranges9999999999 029000000000 EX External numbering 028000000000 Current numbers7000000000 016000000000 SB Internal numbering 01 defined until fiscal5000000000 year in the future4000000000 Current numbers3000000000 22 00 DR2000000000 Internal 00 www.indiantaxhome.com numbering1000000000 defined per fiscal0000000000 year 1998 1999 2000 2001...

23. The Document’s Header Dates: • Document Date, • Posting Date, • Translation Date, • Entry Date (automatic), • Period. Document Type Company Code Currency 23 Additional information: • Reference, www.indiantaxhome.com • Short text.

24. Posting keys Field Relevant for postings no suppress on accounts of this type? yes Posted with which Posted on Account posting key? which account? PK ... PK ... Po de stin - 24 g sta pend key u nt nt tus en - co nde tus t fi Ac pe ta eld de ld s Priority www.indiantaxhome.com fi e ?

25. Line items  During document entry, certain fields need to be filled in. For example, when posting expenses, a cost center and tax information is usually required. 25  Tax fields are only ready for entry if the general ledger account is set up as tax-relevant. www.indiantaxhome.com

26. Posting a document Document entered correctly Posting functions 26 You can now:  Simulate your document - press the “Simulate” button: www.indiantaxhome.com  Or post it immediately - press “Save” button (F11)

27. Posting in Foreign CurrencyLocal currency - Functional currency of the company codeDocument currency - Currency of the documentGroup currency - Alternative currency for group reporting For every Company Code there’s defined a company code currency, ie, every company code has a “local” currency. Every document, posted in different currency than company code currency, is processed as a foreign currency document. Accounting documents can be posted in a foreign currency The foreign currency is converted to local currency and both are stored in the 27 document along with the exchange rate www.indiantaxhome.com

28. Posting in Foreign Currency1. 2. 3. 1. Exchange rate can be entered manually, 28 2. Or derived from “Exchange Rates Table” 3. System automatically translates the foreign currency www.indiantaxhome.com into CC currency.

29. Parking / Holding a Document After entering the document it is possible: 29 • To post it immediately • To “park” the document www.indiantaxhome.com • To hold the document

30. Reference DocumentsDocument # 1 (Reference Document):Header: 01/03/2003 Comp. Code: 5200Line Items: PK Account Amount 40 123000 5000 50 345560 2000 50 907902 3000 Document # 2: Line Items: PK Account Amount 30 40 123000 5000 50 345560 2000 50 907902 3000 www.indiantaxhome.com Reference documents are either accounting documents or sample documents that are used as a reference to post an accounting document.

31. Reverse a GL document Document entered incorrectlyBalance sheet Assets Liabilities Document corrected by Reversal: Shared equity Reverse with a standard reversal posting Reverse with a negative posting 31 Document re-entered correctly www.indiantaxhome.com

32. Mass Reversal of Documents Mass Reversal Procedure 32 www.indiantaxhome.com Many documents may be reversed at the same time, Process may be scheduled to be performed in the background.

34. Account Analysis / ReconciliationSAP R/3 supports the following transactions:Display G/L account balanceDisplay G/L line itemsG/L account analysis functionsClear outstanding items on G/L account 34 www.indiantaxhome.com

35. Account: balance and line items Account balance Account Balances display • Opening Balance (Carry forward Balance from previous year) • Totals of all transactions for each posting period broken down for • Debits and Credits 35 From these figures the system calculates the following for theaccount balance function www.indiantaxhome.com • Balance per posting period • Accumulated balance for the account

36. Account: balance and line items Line items Line items can be displayed on G/L accounts which are managedwith Line Item display 36 • Line items are displayed on-line • Line Items can be totaled and sorted according to user requirements • Additional fields can be added to the Line Item display screen www.indiantaxhome.com • Alternative custom defined Line Layouts can be defined

37. Account Analysis Functions  Functions supporting account analysis are grouped on the “Application toolbar” 37 www.indiantaxhome.com

38. Open Item Clearing 1 2 3 You can onlyOpen items clear open itemsrepresent for accounts thattransactions 38 are open itemthat are managed.incomplete. www.indiantaxhome.com The balance of an open item managed accounts are the reconciliation items.

39. Reversal of Clearing Display cleared items 39Reversal of clearing  Reversal of documentswww.indiantaxhome.com before is not possible, that were cleared  First the clearing operation must be reset.

41. Period End ProcessingSAP R/3 supports the following transactions:Fiscal Year variants & Posting PeriodClear open items, both manually and automaticallyCreate, maintain and process accrual/deferral transactionsRecurring EntriesRevalue balances in foreign currenciesReconciliation of documents with monthly debits & creditsRoll over of closing balances to form opening balances can be 41performed multiple times and after the beginning of the new fiscal year. www.indiantaxhome.com

42. Posting PeriodsCompany Code Data Fiscal Year VariantsCompany Code 0001 K4 Same as Calendar YearFY Variant R1 R1 Shortened Fiscal Year V3 Non-Calendar Fiscal Year Calendar Year Year 2003 Properties Periods FY Variants R1 FY Variants R1 Calendar Year Mo. Day Period Year Year-Dependent C 01 31 10 -1 No. of Post. Per. 12 02 28 11 -1 No. 42 Special Per. of 2 03 31 12 -1 04 30 01 : 12 31 09 www.indiantaxhome.com  Every transaction that is posted is assigned to a particular posting period

43. GL Account Clearing Automatic Payment Bank Statement A typical example of an open item is, for instance, a bank clearing 43 account. A transaction is cleared when an offset value is posted to an item or group of items, so that thewww.indiantaxhome.com of the items is zero. resulting balance

44. Automatic Clearing ProgramOpen items for G/L Accounts, Vendors and Customers can becleared automatically by running the Clearing ProgramSet up predefined criteria for automatic clearing (Configuration)Program groups those items from an account that have the same • Trading Partner ID • Reconciliation Number • Currency in which the General Ledger is updated • Four freely definable criteria Accounts xxxxxx xxxxxx xxxxxx xxxxxx 44 ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---- www.indiantaxhome.com Automatic clearing program

45. Deferrals & Accruals Accruals and deferrals can be handled automatically by the SAP R/3 system Accrual/Deferral Documents are created on a monthly basis to record expenses/income which were anticipated but not yet realized Once a transaction has been approved, it can be set up and run automatically each month. The recurring entry program helps to maintain Accruals / Deferrals postings • Standard Journal Posting • Has a reversing date • Reversal Date can be any date in the future • Monthly job is scheduled to reverse all Accrual/Deferral Documents automatically 45 www.indiantaxhome.com

46. Recurring Entry Document Posting Parameters First run on 01/01/2002 Last run on 12/01/2002 Interval in months 01 Run Date 15 Run Schedule ____ Document ____________ ______________________ ______________________ 46 03/01/2002 ___________________ 02/01/2002 ___________________ ___________________ 01/01/2002 ___________________ ___________________ www.indiantaxhome.com___________________ ___________________ Batch Input ___________________ Session ___________________

47. Recurring Entry Document (2) Dates when the first and the last recurring entries are to be carried out Document ‘s 47 Header www.indiantaxhome.com Line items

49. Reporting SAP system offers number of reports that help analyzing entered business transactions: • Financial Statement Version (Balance Sheet and P&L) • Account Balances • Line Items • Documents • Master Data Report can be: • Printed out directly to the printer, • Saved as a local file (txt format, Excel file etc.) 49 • Sent by e-mail www.indiantaxhome.com

50. Reporting Requirements Balance Cash Sheet Flow FI IncomeExternal Reporting Statement COInternal Reporting 50 Cost Product Center Profit www.indiantaxhome.com Cost Center

51. Financial Statement VersionFinancial Statement Versions are set up to represent the balancesheet and P+L statement according to your own specific requirements • Can be created for different legal entities • Can be created in different Languages • Are executed in desired currency i.e. Local, GroupUsing the Financial Statement you specify • Line items to be included in the Financial Statement • Sequence the line items are displayed • The COA and the accounts that are displayed in the Financial Statement • The totals that are presented on the Financial Statement 51 Balance Income Sheet Statement www.indiantaxhome.com

52. Report Tree 1 SAP Menu 2Transaction SA38 52 A user can run the required report in two ways: • Directly from “Report www.indiantaxhome.com Tree” • Using transaction SA38, provided the he knows the report name

53. Report Tree 1 SAP Menu 2Transaction SA38 53 A user can run the required report in two ways: • Directly from “Report www.indiantaxhome.com Tree” • Using transaction SA38, provided the he knows the report name

54. Report Execution Report Execution Selection of Report Parameters 54 Variant Selection Dynamic selection www.indiantaxhome.com A report can be executed directly or scheduled in the background

55. Report Variant 2 2) Press “Save” button 1) Enter the required 1 criteria on the selection screen 55 3) Enter the variant’s 3 www.indiantaxhome.com name

56. General Ledger Process Overview Financial  Process decompositions are the startingAccounting point for our process documentation.  They summarise what is involved in a the GL process at a high level General Ledger Master Transaction Account Periodic Reporting Data 56 Processing Analysis & Processing Reconciliation www.indiantaxhome.com

SAP FI - GL

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SAP FI - GL