Sap fico finance terms

SAP FICO Finance Terms
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• 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 self-
contained 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 enterprise’s
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).

• 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

• Asset class: The main criterion for classifying fixed
assets according to legal and management
requirements.
• 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).

• 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).
• 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

• Accrual and deferral: The assignment of an organization’s
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.

Sap fico finance terms

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Sap fico finance terms