STEP BY STEP DOCUMENTATION OF SAP FICO PROCESS

FI Basic Setting
1. Company- OX15

The smallest organizational unit for which individual financial statements are created
according to the relevant legal requirements. A company can include one or more company
codes. All the company codes within a company must use the same chart of accounts and
fiscal year. However, each company code can have a different local currency.

2. Company Code- OX02

The company code is the central organizational unit of external accounting within the
SAP System. You must define at least one company code before implementing the Financial
Accounting component. The business transactions relevant for Financial Accounting are
entered, saved, and evaluated at company code level.

3. Assigning company code to company OX16

4. Business Area- OX03

Business areas are used in external segment reporting (over and above company
codes), based on the significant areas of operation of a company (for example, product lines,
branches).

5. Fiscal Year – OB29

6. Assign company code to Fiscal year variant OB37
Usually a period of twelve months for which a company regularly creates financial
statements and checks inventories. The fiscal year may correspond exactly to the calendar
year, but this is not obligatory. Under certain circumstances a fiscal year may be less than
twelve months (shortened fiscal year).

In General Ledger Accounting, a fiscal year can have a maximum of twelve posting
periods and four special periods. You can define up to 366 posting periods in the

You have the following options for defining fiscal year variants:

 Fiscal year same as calendar year

 Fiscal year differs from calendar year (non-calendar fiscal year). The posting periods
can also be different to the calendar months.

7. Posting Period variant - OBBO

8. Assign company code to Posting period variant OBBP
9. Open & Close posting Period variant OB52
10.What is Segment-

The segment is defined as a subarea of a company with activities that generate

expenses and revenues, with an operating result that is regularly used by management for
profit assessment and resource allocation purposes, and for which separate financial data is
available.

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There are 2 segments are there

Chart of accounts segment
Company code segment
11.Field Status Variant- OBC4
Field Status Variant is used to define the fields which are used for input like cost
canter, profit canter, plant, etc., which are entry fields, and hidden fields. Field status Variant
is a tool which is provided by SAP to assign the same set of properties to more than one
object.
Example − we define fiscal year variant and it can be assigned to more than one company
code. If a field status variant is assigned to more than one company code, the same set of
screen field will be displayed while posting those company fields.
11.1 Field Status Groups- OBC4
12.Assign company code to Field status variant OBC5

You use this field to define which fields are displayed when you post accounting transactions
to a G/L account. A field may have one of the following statuses:

 hidden (suppressed)

 Entry required (required field)

 Ready for input (optional field)

13.Chart of Account- OB13

Chart of Account is nothing but list of GL Accounts or structure of GL account or a
folder where all GL sitting.
14.Assign company code to Chart of Account OB62

Chart of account is a list of all G/L accounts used by one or several company codes.
For each G/L account, the chart of accounts contains the account number, account name, and
the information that controls how an account functions and how a G/L account is created in a
company code.

Charts of accounts can have three different functions in the system:

 Operating chart of accounts- The operating chart of accounts contains the

G/L accounts that you use for posting in your company code during daily
activities. Financial Accounting and Controlling both use this chart of
accounts. You must assign an operating chart of accounts to a company code.
 Group chart of accounts- The group chart of accounts contains the G/L
accounts that are used by the entire corporate group. This allows the company
to provide reports for the entire corporate group. The assigning of a corporate
group chart of accounts to a company code is optional.
 Country-specific chart of accounts-The country-specific chart of accounts
contains the G/L accounts needed to meet the country's legal requirements.

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This allows you to provide statements for the country's legal requirements.
This is optional to assign.

15.Account Groups- OBD4

The account group is a summary of accounts based on criteria that effects how master
records are created.

The account group determines:

 The number interval from which the account number is selected when a G/L account
is created.

 The screen layout for creating G/L accounts in the company code-specific area

16.Retained Earnings Account- OB53

Retained Earnings Account is used to carry forward the balance from one fiscal year
to the next fiscal year. You can assign a Retained Earning Account to each P&L account in
the chart of accounts (COA). To automatically carry forward the balance to the next fiscal
year, you can define P&L statements as per COA and assign them to the retained earning
accounts.

17. Tolerance Group for GL account- OBA0

In real time business scenario, tolerance groups allow the SAP system to process and
post the transactions not beyond the tolerance groups limits. Tolerances are referred as
payment differences, it can be a amount tolerance, percentage tolerance, and debit & credit
tolerance.

18.Tolerance Group for Employees- OBA4

Tolerance group in sap is defined to make sure that the employees do not exceed their
authority while entering any financial transactions. Tolerance Group is created by some
configuration as a result the limit is restricted to a specific point beyond which transaction
cannot be carried out.

19.Company Code Global Data- OBY6

Global parameters control how a company code behaves in the SAP system; these
parameters influence the way system process the business transactions. Global parameters are
divided in to two categories.
 Accounting organization
 Procession parameters.

Q & A-

1. What do you specify in COA?

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We specify name of COA, language of COA, length of GL account number and cost element
creation.

2. What is account group in sap and what it does?

An account group is a segregating or grouping the similar accounts in to single group. Each
account group in SAP is assigned to a chart of accounts, so you can only use account group if
the controlling areas use the same chart of accounts.
Account group will define what the number you should use while creating GL master
records.

3. What is retained earnings account and use?

Retained earnings account is a bridge between P/L accounts to Balance sheet B/S. at the
yearend balance of P/L will carry forward to B/S through this account.

4. Is it possible to maintain more than one retaining account and use?

Yes, we can maintain more than one based on requirement. So when we assign more than one
we have to specify the retained earning account in GL, at the time of P/L GL account
creation. Then the respective values will go respective retained earnings account.

5. What do you mean by document number range and use?

Document number is unique identification. Document number can be internal or external. If it
is internal system will generate number for the document from the interval. If it is external we
have to give number to the document from the interval.

6. What is document type in sap and use/what it controls?

Document type bifurcates the business transactions based on nature of the transaction. So, we
can come to know what type of entry it is by seeing the document type. It controls the
document header data fields like reference number header text fields, and it controls the
a. Number range interval of the document
b.Reversal document type
c. Account types which are to allow
d.Exchange rate type for the document type
e. Negative postings allowed
f. Intercompany transactions allowed

7. What is posting key use?

System does not know which line item debit and which line item is credit, based on posting
key which we give at line item level system will treat debit and credit line items. And posting
key also controls the field status of the document line item like field status group.
8. Deference between posting key and field status variant?

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Posting key is at client level field status group is company code level. So if you make any
changes at posting key level it will be applicable to all company codes in client whereas field
states group does not do it because it is company code level.
9. What is the use of propose fiscal year check box?
If we select this option system proposes the always with current year as default value like
value date also works.
10. What is the use of default value date?
If we select this option system proposes the always with current date as value date as default
value.

11. What do you mean by company code is productive and where do we specify?
If you select this option system prevent automatic deletion of programs and settings
generally, we select this in production system. This option is available in global parameters.

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General Ledger FS00

General Ledger (G/L) accounts are used to provide a picture of external accounting
and accounts and to record all the business transactions in an SAP system. This software
system is fully integrated with all the other operational areas of a company and ensures that
the accounting data is always complete and accurate.

There are 3 important TABs in FS00.

 Type/Description
 Control Data
 Create/Bank/Interest

1. Document Types- OBA7 FBN1

Document types reflect the different business transactions in your organization. Since
the document type can be displayed for every line item, you can immediately find out the
type of business transaction in both document display and line item display. You can also use
the document type for evaluation purposes.

2. Maintain Controlling Area - OKKP

Controlling Area is the highest organizational structure in (CO)

Controlling/Management Accounting. You could assign either one or several company codes
to Controlling Area. Assigning several company codes to one controlling area is only
possible when all of them use the same Operational Chart of Accounts and Fiscal Year
Variant. In this way could have cross-company code internal reporting.

3. Document splitting- SM30 (V_FAGL_SPLIT_ACT)

Document splitting splits up line items during the posting for selected dimensions
such as receivable lines by PROFIT CENTER. Also, to affect a zero-balance setting in the
document for selected dimensions such as SEGMENT, document splitting can be used. The
zero-balance setting may generate additional clearing lines in the general ledger view.

4. Enter GL account posting- F-02

Through F-02 you can post any kind of adjustment entry for any FI Module viz.,
Vendor, Customer, Assets, General ledger, etc. The key here is what posting key you select.
For Eg: If you need to post to Vendor or Customer, you will have to select the designated key
like 25, 35 etc; For Assets posting key like 70 & 75.

5. Display Document- FB03

6. Display GL Account Balance- FS10N
7. GL Account line item display- FBL3N
8. Enter GL Account Document FB50
9. HOLD Document-
A. Post Hold Document F-02

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B. Display Hold document FB11

C. Posting of Held Document F-02
10.Park Document –

A. Post Park Document F-65

B. Display Parked Document FBV3
C. Change Parked Document FBV2
D. Post Parked Document FBV0

11.Recurring Document-

Recurring documents can eliminate the need for the manual posting of accounting
documents, which do not change month to month. For example, office rent. at the end of the
month all recurring entries automatically posted through a batch process.: Posting key,
Account, Amount.

A. Recurring Document Number range X1 FBN1

B. Enter Recurring document FBD1
C. Display Recurring Document FBD3
D. Display list of Recurring Documents F.15
E. Change Recurring document FBD2
F. Post recurring document F.14
G. Delete Recurring document F.56

12.Sample Document-

Sample document is a reference document for the original documents. It will not update
any transaction figures. We can use the sample documents for month end provisions. The Tc
is F-01; you can use the standard document type X2 for sample documents.

A. Sample document number range X2 FBN1

B. Enter Sample document F-01
C. Display Sample document FBM3
D. Change Sample document FBM2
E. Delete sample Document F.57

13.Difference between partial payment and Residual payment in SAP?

If you go for partial clearing the document will keep open till you pay remaining amount
whereas if you go for residual clearing the original document will be cleared and new
document will be generating for new residual line amount.

14.Foreign Currency Transaction-

A. Check Currency Codes OY03

B. Check Exchange Rate Types OB07

We have total three exchange rate types

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1. B - Standard translation at Bank selling rate

2. G - Standard translation at Bank buying rate
3. M – Standard translation at Average rate

C. Define translation Ratios for currency Translation 1:1 OBBS

D. Enter Exchange Rates OB08

15. Reversal of Document- S_ALR_87002472

A. Reverse individual posting FB08

B. Reverse Mass posted Document F.80

16. Bank Account Interest Rate calculation-

A. Define interest calculation Type OB46

Here we specify whether it is balance interest calculation are item interest calculation.

B. Prepare Account Balance interest calculation OBAA

Here we specify interest calculation indicator the frequency (monthly, quarterly, yearly)
and calendar type Calendar type is G

C. Define reference interest rates OBAC

Here we specify whether this interest rate is for debit or credit and effective from date
currency.

D. Define time – Dependent terms OB81

In this activity we establish the link b/w interest calculation indicator or reference
indicator rate.

E. Enter interest values OB83

F. Prepare GL A/c balance interest calculation OBV2

Symbols 0002- Interest Paid 2000 – G/L A/c paid

G. Automatic Interest Calculation F.52

17. Accrual /Deferral document

A. Post Accrual / Deferral document FBS1

B. Reverse Accrual / Deferral document F.81

Q&A

1. What do you mean by tax category?

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If the GL account is subject to tax we have to specify tax category whether it is input or
output or all categories. Then you must give tax category field value.
2. What is the use of alternative account number in GL master?
The alternative account number field in the company code area is freely definable. You could
use it to enter the account number from your legacy system or
If we implemented country specific chart of accounts this field must filled with country
specific account. The account number from a country chart of accounts if your corporate
group uses a standard chart of accounts.
3. What is the use selecting line item display?
Select this option if you want to see line items in ledger view. If you select open item
management check box this field is mandatory. We must select to clear line items.
4. What is the use of open item management explain briefly?
Select this option where clearing is required. If you select this option, we will be able to see
all the line items separately in ledger like open item and cleared items. Generally we select
this option for only balance sheet GLs we can`t select for P/L accounts. Then we can clear
against line items fully or partially or residually
5. What do you mean by post automatically check box and for what type of account
we select give some examples?
Select this option where you want to post automatically. If we select we can`t post manually
to particular GLs.
EX: GR/IR
6. What do you mean by GL account block and how many ways are there the uses of
each one is?
If you go for account block it will ask you against what you want to block like
i. Block for creation
ii. Block for planning
iii. Block for posting
So if you block GLs those will be no longer valid to against you option. If you block for
posting we can’t make any posting like remaining also work.
7. How many segments are there in document what are they?
Two segments are there in document those are 1.header data segment (BKPF table) 2.line
item segment (BSEG table).
8. What do you mean by interest calculation type and what are the types?
There are 2 types of calculations are there
1) Balance interest calculation (on GLs) S
2) Item interest calculation (on vendors and customers) P
9. What is the use of exchange rate calculation in sap?

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As per accounting standards we have to value the FC in local currency how much we are
holding as FC. So when we value this we may get either profit or loss, we called it as
exchange loss or exchange gain.

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Accounts Payable
AP deals with vendors. Here all vendors activates will be taken care like invoice
management, making payments based on terms and conditions.
1. Create Vendor Account Group- OBD3
Here we create the vendor account Group with the screen layout rules like Reconciliation
account as required entry, all account Groups are Client level.
2. Create Number range for vendor account Group- XKN1
Here in this step we will create number range for Vendor account Group
3. Assign number ranges to Vendor account Group- OBAS
4. Define tolerance limit for vendors OBA3
In this step we will configure the debit and credit limits for the vendor postings and
payments.
5. Create Vendor Master - XK01
Vendor master record consists of the following configuration screens.

1. Create vendor initial screen – Company code, Account Group, Purg Org.
2. Vendor address- Country, address
3. Vendor control - Tax details, VAT Reg. Number, Customer
4. Vendor payment transactions -Bank account, Alternative Payee details
5. Vendor accounting information ( Reconciliation account, Cash mgnt group)
6. Payment Transaction accounting – Payment terms, Pay method.
7. Vendor correspondence accounting– Dunning Details
8. Withholding tax accounting – If applicable
6. Define document types and number ranges- OBA7
KR /KZ /KA
KR- Invoice - 19
KZ-Payment -15
KA –Reversal document -17
7. Posting an vendor invoice F-43 FB60
Here we will post the invoice with the help of line items 31 and 40.
8. Outgoing payment (Full/ Partial/ Residual) F-53
9. Display Vendor balance FK10N
10.Vendor payment Difference & Rounding off difference OBBE
Here we post the pay difference and rounding off the total amount while making a
payment; first we need to create the reason codes for both pay difference and rounding
off in OBBE.

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A. Create GL account for pay difference & Rounding off

B. Define GL Account for pay difference & Rounding off OBXL
11.Check Management-
A. Create House Bank FI12
B. Create Check Lot FCHI
In this step we will create the check lot and will decide the check number should pick
automatically or we have to give manually by selecting non sequential tick mark.
C. Manual check update FCH5
D. Display check Register FCHN
E. Update Encashment date FCH6
F. Cancel issued check without reversal of payment document FCH9
G. Cancel unused check FCH3
H. Define Void Reason code FCHV
I. Cancel issued check with reversal of payment document FCH8
12.Terms of Payment – OBB8
Terms of Payment are conditions agreed between business partners for
the payment of invoices. The conditions define the due date and the cash discount offered
for payment of the invoice within a certain period. Terms of payment enable the system
to calculate a cash discount and invoice due date.
13.Cash discount-
Cash Discount is a reduction in the price of an item for sale, allowed in those cases
when payment is made within a stipulated period. In general business scenario, the cash
discount will depend on the payment terms agreed with the customer & Vendor.
Assign Cash discount GL account for auto posting OBXU

14.Down Payment ( Advance Payment) Special GL posting-

Down payment is special GL transaction so we have to give bridge between recon
account and this special GL recon account. When we post down payment we have to give
special GL indicator so those items will flow to particular account which we have given in
background.
A. Create Rec. GL account for Advance payment under assets FS00
B. Maintain account configuration for special GL account OBYR
C. Post Vendor Down Payment F-48
D. Clearing Down payment F-54
E. Clear vendor line item F-44
15.Post Vendor Credit Memo- F-41 FB65
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16.Automatic Payment Program FBZP

A consistently high volume of invoices have to be processed. Accounts Payable Invoices

have to be paid on time to receive possible discounts. The Accounting department wishes to
perform this processing of invoices automatically. The Automatic Payment Program is tools
that will help users manage payables. SAP gives users the options to automatically:

 Select Open (Pending) Invoices to be paid or collected

 Payment Documents to be posted
 Print Payment Media or generate EDI

Total 6 Steps have been involved in APP these are –

 All Company Codes

 Paying Company Codes
 Payment Methods / Country
 Payment Methods / Company Codes
 Bank Determination
 House Banks

1. All Company Codes:

Where you need to specify the paying company code, sending company code, and
also the separate payments as per the business area would like to process. And also we
can consider special GL transactions for vendor and customers. Apart from that we need
to configure another step i.e.

2. Paying Company Codes:

Minimum Amounts for Incoming and Outgoing Payments, bill of exchange Parameters,
Forms for Payment Advice and EDI

3. Payment Methods / Country:

Where you specify whether the payment medium is for incoming payment or
outgoing payment. Whether it is check or bank transfer and also we need to specify
document types of payment. Also we need to specify the payment program name for
check printing whether it is going for payment medium exchange. Also we need to
specify currency specifications if you want to specify. After that we need to specify the

4. Payment Methods / Company Codes:

Minimum and maximum payment amounts, whether payments abroad and foreign
currencies are allowed, Grouping Options, Bank Optimization and Forms for payment
media.

5. Bank Determination:

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Where you specify the ranking orders and currency specifications, house bank, account
id, and available balance, later we will process the vendor open items then, the system
will identify the corresponding house bank and system will generate the payment
advises and send the communication to the bankers and vendors.

6. Print Run- You need to define the variants for print programs, you need to run the
print program at least one variant per print program per payment method. The data
created by Payment Program is stored in tables like: REGUH – Payee or payment
method data, REGUP – Individual open items data, REGUD – Bank data and payment
amounts data.
17.Extended Withholding Tax (TDS)-

Withholding Tax is also called as retention tax. Its requirement of Government to deduct
or withhold a particular percentage from paying to the vendor and pay such amount to the
Government on behalf of other person. It’s a kind of Indirect Tax

1) Withholding Tax is also known as TDS in India.

If a TDS is required to be deducted from a particular Vendor invoice or during advance
payment to Vendor, it can do with the Withholding Tax functionality.
2) While doing Withholding Tax configuration you would be required to create W/Tax Type
& W/Tax code for both invoice & payment. These W/Tax code & W/Tax type needs to be
mapped in each Vendor Master Data (FK01 for new Vendors & FK02 for existing Vendors
which are already created in the system). Since the W/Tax codes & W/Tax types are already
assigned in each & every Vendor, so it is not required to assign any Tax code in Invoice tab.
Also, W/Tax codes and Tax codes (which we assign in Tax code Coolum) are different. Once
the Master data is updated with W/Tax code, we don't need to use tax code again & again
until & unless Vendor Master Data is changed.
3) No additional steps need to be followed in case of invoice verification since the Vendor
master data is already updated with the W/Tax code and W/Tax type.
With this functionality, you can prepare report easily for filing Quarterly TDS return and
Form 16A can also be generated.
A. Check Withholding tax countries
IMG- Fin. Accounting – Fin. Accounting Global settings –Withholding tax – Extended
withholding tax-Basic settings – Check withholding tax countries-
The withholding tax country is needed for printing the withholding tax form and also for
maintaining the tax codes in the vendor master and customer master.
B. Define withholding tax type for invoice posting-
IMG- Fin. Acct. –Fin.Acct. Global settings- Withholding tax- Extended Withholding tax –
Calculation – Withholding tax type – Define withholding tax type for invoice posting
C. Define withholding tax type for payment posting –
IMG- Fin. Acct. –Fin.Acct. Global settings- Withholding tax- Extended Withholding tax –
Calculation – Withholding tax type – Define withholding tax type for payment Posting
D. Define withholding tax codes-

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IMG- Fin. Acct. –Fin.Acct. Global settings- Withholding tax- Extended Withholding tax –
Calculation – Withholding tax codes – Define withholding tax codes.
E. Assign withholding tax type to company code-
IMG- Fin. Acct. –Fin.Acct. Global settings- Withholding tax- Extended Withholding tax –
Company code – Assign withholding types to company codes.
F. Activate Extended withholding tax-
IMG- Fin. Acct. –Fin.Acct. Global settings- Withholding tax- Extended Withholding tax –
Company code – Activate withholding tax.
G. Maintain company code settings-
IMG- logistic general – Tax on goods movement – India – Basic settings – Maintain
Company code settings.
H. Create TDS Payable GL account FS00
I. Define account for Withholding tax to be paid over OBWW
J. Assign withholding tax code to vendor master data XK02
Q & A-
1. What is vendor account group and what it controls?

This source to create vendor master records it controls the number range interval of
the master record and field status of the master record. These account groups are at client
level.
2. What is cash journal?

Why do we use in SAP? Normally GL cash account accepts negative balances, but cash
journal will not accept negative balances. In companies they take daily cash statement
showing open cash balances / receipts for the day / payments for the day and closing cash
balances. Cash journal provides this statement. Some companies use this cash journal as
petty cash purpose. Define Number range interval for CJ: FBCJC1. Document type: SA.
Setup cash journal: FBCJC0. Create/change/delete business transaction: FBCJC2. Setup
print parameters for Cash Journal: FBCJC3. Post cash journal entries: FBCJ.
3. Where do you give program for check printing?

In payment method per country.

4. What is payment method, and use, at what level it is?

Payment method tells us what type of payment it is. Like whether it is check payment or
bank trance for or bill of exchange what it is. It is at country level.
5. What is the use of payment advice and payment medium?

Based on payment advice bank will make payments to party’s. In payment advice due
date would be there based on bank carryout payments.
6. If I give single particular currency for payment method is it possible to make
payments in different currency?

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No, that is not possible to make in different currency if payment method currency is
different.
7. What is the use of tolerance days in APP?

Grease days to invoice due date.

8. Correspondence:

 There are various standard correspondence types available like invoice print, account
statement etc. Custom correspondence types can also be created.
 Correspondences can be created at the time of particular business transaction
processing or at a later stage for already created transaction postings.
 Correspondence can be sent to customer/ vendor in various formats like email, and
fax. Correspondence is basically letters etc. which is sent from SAP to vendor/
customer etc.

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Accounts Receivables
AR deals with customers gathering the requirements from the customers and providing
goods and services invoicing for it and taking incoming payments if any pending’s from
customers issuing dunning notices all the activities will be done.

1. Define Customer Account Group: OBD2

2. Create Number Ranges for Customer Accounts XDN1
3. Assign Number Ranges to Customer Account Groups OBAR
4. Create Customer Master XD01
5. Define Document Types and Number Ranges
DR- 18 -invoice
DZ- 14- Payment
DA-16-Reversal
6. Posting Customer invoice (Posting Key 01 Dr 50 Cr) F-22
7. Posting Customer invoice FB70
8. Display customer line item FBL5N
9. Customer Balance display FD10N
10.Incoming payment F-28
11.Down Payment
A. Maintain account configuration (Special GL) OBXR
B. Post Customer Down payment F-29
C. Post Customer invoice F-22
D. Post incoming payment F-28
E. Clearing down payment F-39
F. Clear customer document F-32
12.Customer credit memo (Posting key 11 Cr 40 Dr) F-27 FB75
13.Maintain Terms of Payment OBB8
A. Define account for Cash discount Granted OBXI
14.Sales Tax-
A. Define Procedure OBYZ
Step Condition Type Description From To Account Key
1 BASB Base Amount
2 MWAS Output Tax 1 1 MWS
3 MWVS Input Tax 1 1 VST
B. Assign country to Calculation Procedure OBBG
C. Define Sales Tax FTXP
D. Define Tax accounts OB40
15. Dunning-
Dunning plays a vital role in Accounts receivables. Dunning is similar to reminder
notice to our business partners for their overdue/open items or outstanding balances.
Dunning letter summarizes overdue invoices record and asks for payment to be made.

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We configure dunning program for accounts receivable and accounts payable. Dunning
Program includes following configuration steps:
1. Dunning procedure controls the path of dunning to the customer and vendor
through the system. We can define our own dunning procedure as per our
convenience. Transaction code: FBMP.

2. Dunning level defines dunning text; maximum nine dunning levels are available.
As the dunning level increases, text will also change as consistent to make
payment.

3. Dunning area means the client/company/company code in which we are working

on dunning program. If we don’t want to run dunning program at company code
level then we can also run dunning program at organizational level like, sales
organization.

A. Define dunning Area OB61

B. Define dunning Procedure FBMP
C. Change customer Master XD02
D. Dunning F150
E. Display customer Master XD03

Q & A-
1. How many Dunning levels are there and generally how many levels we use?

Maximum levels are 9 generally we use 4 levels if we want to use all the levels we can
use.
2. What is the difference in donning notice for each level?

For each level of donning notice severity of notice and text will be change. If there is
any interest for next level that will be add to amount so in this case amount also change.
3. Is it possible to integrate vendor and customer?

Yes, we can integrate vendor and customer in 2 master records we have field under
general data segment in control tab to enter customer and vendor.
4. If we integrate vendor and customer is it possible to make payment by
adjusting the amount with payment?

Yes, we can adjust against AP outgoing payments with AR incoming payments.

5. How many segments are there in customer master what are?

There are 3 are 1. General data segment 2. Company code data segment 3. Sales
organization data segment
6. What is the use of item interest calculation in AR?

For calculation of interest on overdue items.

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7. To make AP payments we have APP program like for incoming payments do

we have any program in AR?

Yes, we have process called lock box system.

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Fixed Asset Management

1. Check Country – Specific Settings-
Path- IMG-Financial Accounting –Asset Accounting- Org. Structure-Check country
specific settings.
Here we check the country specific settings whether the settings already there in the SAP or
we have to create manually as per our country.
2. Copy Reference chart of Depreciation/Depreciation Areas EC08
Path-IMG-Financial Accounting – Asset Accounting- Org. Structure- Copy reference chart
of depreciation /depreciation Areas
Chart of depreciation is a country specific that provides various pre-defined
charts of depreciation with pre-defined depreciation areas. Each company code uses
one chart of accounts and one charts of depreciation. We can create charts of
depreciation by copying from reference charts of depreciation, after copying you
may delete depreciation area you do not need, deletion must be done before creating
of any asset. Client level.
Depreciation Area- Depreciation area is two digits alphanumeric key that
determines the specific type of valuations. Depreciation is keys are used in asset
master record or in asset classes.
Book Depreciation – 1
Income tax depreciation -15
3. Create of 0% tax code for sales and purchases FTXP
4. Assign tax code for non-taxable transaction OBCL
5. Assign chart of depreciation to company code OAOB
Path- IMG-Financial accounting- Asset Accounting – Org.structure-Assign chart of
depreciation to company code.
6. Specify Account determination-
Path- IMG-FA-AA-Org.structure- Asset class- specify determination.
Accounting Determination we do it in AO90 T-code. Here we assign GL accounts to
flow data automatically respective GL accounts based on nature of transaction like for
acquiring, for sale of asset, losses on sale, and gain on asset sale, and for accumulated
depreciation and depreciation etc...This account determination we assign in assent class.
7. Create Screen layout Rules-
Path- IMG-FA-AA-Org. Structure-Asset classes- Create screen layout rules.
In this step, you create your screen layout rules. The screen layout specifies the status of the
fields in the asset master record. You use the screen layout to determine if fields are required entry
or optional entry fields, or if they are suppressed completely,
8. Define number range interval- AS08
Path- IMG-FA-AA-Org.Structure- Asset classes-Define number range interval.
9. Define asset classes - OAOA
Asset class classifies the assets based on nature of assets like buildings, machinery, etc,
asset classes are at client level.

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10.Create GL Accounts-
1. Asset GL Account - Reconciliation account
2. Accumulated depreciation account - Reconciliation account
3. Depreciation account -Expenses
4. Loss on Sale asset accounting -Expenses
5. Loss on scrap asset accounting -Expenses
6. Profit on scrap asset account -Revenue
7. Sale of asset account -Revenue (Field group- G052)
11.Assign of Accounts for automatic postings AO90
12.Determine depreciation Area in the asset class-Layout 200 OAYZ
13.Specify document type for posting of depreciation (AF) OBA7
14.Specify intervals and postings rules OAYR
15.Specify Rounding off net book value and /or depreciation OAYO
16.Define Screen layout for asset master date
Path: IMG-F.A-A- Master data-Screen layout-Define screen layout for asset master data.
Required Fields to be amend.
1. General data – Description 1 (Main No, Sub No, Copy)
2. Posting information –Capitalization date (Main No, Sub No, Copy)
3. Time dependent date – Business Area (Main No, Sub No, Copy)
17. Define screen layout for asset Depreciation Areas
Path: IMG-.F.A-A.A-Master data-Screen Layout-Define screen layout for depreciation area.
2000(Depreciation on asset sub-number level)- Depreciation Key (Main No, Sub No,
Copy)& Ordinary depreciation start date (Main No, Sub No, Copy) required entries.
18.Depreciation Keys- AFAMS
Depreciation key is nothing but rate + method. How much rate of depreciation and what
type of method it is whether it is straight line or written down method?
We have total 5 Depreciation calculation methods in depreciation key –
1. Base line method
2. Declining balance method
3. Maximum amount method
4. Multi-level method
5. Period control method
We have total 2 depreciation methods available in SAP
1. Straight line Method
2. Written down method
19.Maintain period control method AFAMP
20.Maintain depreciation key AFAMA
21.Create asset master AS01
Asset master contains some necessary information to calculate the depreciation for the
asset. They are: capitalization date, depreciation areas for that asset, depreciation key, and
useful life, change over if any, scrap value if any and start date of depreciation.
22.Create sub-asset master AS11
23.Asset Acquisition posting F-90
24.Asset explorer AW01N

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25.Depreciation AFAB
26.Asset sale postings F-92
27.Asset transfer posting ( Within company code) ABUMN
28.Asset retirement by scrapping ABAVN
Q & A-
1. What is asset accounting flow?
 Sub asset master will be create with reference to main asset master
 Main asset master will be create with reference to asset class
 In asset class we specify all the attributes like account determination and screen
layout rule etc…
 Values will be flow respective GLs through account determination base on nature
of transaction
2. What is the use of sub-asset in SAP?

We can see the report sub asset level and we can post values to sub asset.
3. How many segments are there in asset master?

There are 2 those are 1. Company code segment or asset segment 2. Depreciation segment
4. How many ways can we control asset master fields?

2 way are there one is from general screen layout rule and 2nd one is from depreciation tab
level.
5. Can you create multiple assets in one transaction?

Yes, you can create multiple assets under single transaction AS01, only when all the
assets belong to same asset class with same company code. You cannot create long text
though this method. Time-dependent tab in Asset master: All cost accounting
assignment related data such as cost centre, internal orders or investment projects
needs to be maintained in this tab. Asset shutdown and shift operation is also
maintained here.
6. How do shutdown the particular asset?

First you have to select Asset shutdown option when assignment of calculation
methods tab in depreciation key level (AFAMA). Then also you have to select asset
shutdown optional in time dependent tab in asset master screen layout. Then you come to
the asset edit mode (AS02) and you can select asset shutdown button and add the interval
from what date till what date it has to shutdown in time dependent tab in more intervals
button.
7. Asset transaction type:
Example:
 100-external asset acquisition,
 110-house acquisition,
 200-asset retirement without revenue,
 210-asset retirement with revenue, etc. Transaction types are assigned to Transaction
type groups.
8. Is it possible for you to assign an Asset to more than one Cost Center?

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No, an asset can be assigned to only one cost centre.

9. How do you reverse the depreciation posted?
No, we cannot reverse the depreciation once posted. It is not possible to reverse the
depreciation for one particular month. For example, 4 months depreciation is posted. It is
not possible to reverse the depreciation for one particular month at all. When we reset it;
all the values will be gone
10. Is it possible to calculate the depreciation day wise?
Yes, we need to activate this at depreciation key level, where you maintain WDV
method, straight line method.
11. Low value Assets:
The asset if fully depreciated within the same year when it’s acquired. We define a
monetary limit and consider all those assets falling below the value mentioned. We use a
special depreciation LVA, and useful life is considered to be one month
12. Asset Retirement:
Retire by sale or by scrapping. In case of sales, it can be with revenue or without
revenue. Again it can be with customer or without customer. Asset retirement with
revenue o with customer (involving integration with FI-AR) Debit customer, credit
assets o without customer Asset retirement without revenue o With customer Debit
clearing account, credit asset Debit customer in A/R, credit the clearing account
Asset retirement using GL document posting
13. How many Charts of Depreciation could you assign to an asset class?
There is no limit.
14. How many depreciation areas could be assigned to a Chart of Depreciation?
A Chart of Depreciation could contain up to 99 depreciation areas. A Depreciation
Area is always assigned to only one Chart of Depreciation.
15. Capital Work in progress-
We need to treat this as AuC assets. To capitalize this asset master record, there might
be some kind of additional expenses might be occurred, so those expenses must be settled
to the AuC through internal orders. From that we need to create a settlement profile and
maintain the settlement rules under receiver in asset master record and specify the
percentage. You have to use depreciation key ‘0000’ for not calculating the depreciation
till it is settled. Then we have to execute the settlement profile, and then simply execute
it, this way it is settled. Tr.Code: AIAB, AIBU.
Financial Statement Version (FSV):createOB58 &FSE2Actually FSV is nothing
but the format for B/S and P&L statement. So, it will be prepared as per accounting
schedule (6) basis, which contains the items like what kind of the accounting heads
should be there. Also we need to map the GL accounts, which carry the values under
those heads, which is defined at the chart of account specific combination. After that the
statement can be used in our company code combination and generate the values which
are posted with the particular GL master records in that particular financial period which
we specify in the reporting selection. Execute FSV Tr.Code: F.01

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