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BASIC SETTINGS
IMG CREATION OF COMPANY
IMG CREATION OF COMPANY CODE
IMG ASSIGN COMPANY CODE TO COMPANY
IMG DEFINE BUSINESS AREA
OB29 MAINTAIN FISCAL YEAR VARIANT
OB37 ASSIGN COMPANY CODE TO A FISCAL YEAR VARIANT
OB13 CREATE CHART OF ACCOUNTS
OB62 ASSIGN COMPANY CODE TO CHART OF ACCOUNTS
OBD4 CREATE ACCOUNT GROUPS
OB53 DEFINE RETAINED EARNINGS ACCOUNTS
OBBO DEFINE POSTING PERIOD VARIANT
OBBP ASSIGN POSTING PERIOD VARIANT TO COMPANY CODE
OB52 OPEN & CLOSE POSTING PERIODS
OBA7 DEFINE DOCUMENT TYPES AND NUMBER RANGES
OBA0 DEFINE TOLERANCE GROUPS FOR GL ACCOUNTS
OBA4 DEFINE TOLERANCE GROUPS FOR EMPLOYEES
? ASSIGN USERS TO TOLERANCE GROUPS
IMG MAINTAIN FIELD STATUS VARIANT
(IMG>FA>FAGS>DOCUMENT>LINE ITEM>CONTROLS)
OBC5 ASSIGN COMPANY CODE TO FIELD STATUS VARIANT
OBY6 ENTER GLOBAL PARAMETERS

GENERAL LEDGER
FS00 CREATION OF GL MASTERS
F-02 GL POSTING
FB03 DOCUMENT DISPLAY
FS10N ACCOUNT DISPLAY
FB00 TO MAKE DEFAULT LINE LAYOUT
FS04 DISPLAY GL MASTER CHANGES
F-65 DOCUMENT PARKING
FBV3 DIPLAY PARKED DOCUMENTS
FBV0 POST/DELETE PARKED DOCUMENTS
OBBS DEFINE TRANSLATION RATIOS FOR CURRENCY TRANSACTION
OB08 ENTER EXCHANGE RATE TYPES
SAMPLE DOCUMENTS
FBN1 DEFINE NUMBER RANGE GROUP ‘X2’ FOR SAMPLE DOCUMENTS
F-01 CREATION OF SAMPLE DOCUMENT (TEMPLATE)
FBM3 DISPLAY SAMPLE DOCUMENTS
ACCRUAL/DEFERRAL DOCUMENTS
IMG DEFINE REASONS FOR REVERSAL (IMG>FA>GL>BT>DOC RVRSL)
FBS1 CREATION OF ACCRUAL/DEFERRAL DOCUMENT
F.81 REVERSE ACCRUAL/DEFERRAL DOCUMENT
RECURRING DOCUMENTS
FBN1 DEFINE NUMBER RANGE GROUP ‘X1’ FOR RECURRING DOCS
FBD1 CREATION OF RECURRING DOCUMENT (TEMPLATE)
F.15 DISPLAY RECURRING DOCUMENTS
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F.14 EXECUTE RECURRING ENTRIES (SESSION IS CREATED)

SM35 PROCESS BATCH INPUT SESSION
OPEN ITEM MANAGEMENT
FBL3N GL ACCOUNT DISPLAY FOR OPEN ITEM MANAGED ACCOUNT
F-07 POSTING OUTGOING PAYMENT WITH CLEARING
DOCUMENT REVERSALS
IMG DEFINE REASONS FOR REVERSAL (IMG>FA>GL>BT>DOC RVRSL)
FB08 INDIVIDUAL REVERSAL
F-02 REVERSAL OF REVERSAL
(POST WITH REFERANCE & GENERATE REVERSE POSTING)
F.80 MASS REVERSAL
FBRA CLEARED ITEM REVERSAL
INTEREST CALCULATION (BALANCE INTEREST)
OB46 DEFINE INTEREST CALCULATION TYPES
OBAA DEFINE ACCOUNT BALANCE INTEREST CALCULATION
OBAC DEFINE REFERENCE INTEREST RATES
OB81 DEFINE TIME DEPENDANT TERMS
OB83 ENTER INTEREST VALUES
OBV2 ASSIGNMENT OF ACCOUNTS FOR AUTOMATIC INT POSTINGS
F.52 INTEREST CALCULATION RUN
INTEREST CALCULATION (ITEM INTEREST)
? DEFINE INTEREST CALCULATION TYPES
? PREPARE INTEREST CALCULATION ON ARREARS
OBAC DEFINE REFERENCE INTEREST RATES
? DEFINE TIME BASED TERMS
? ENTER INTEREST VALUES
F.2B CALCULATION OF INTEREST ON ARREARS
OBV1 ?
CASH JOURNAL
FS00 CREATION OF GL ACCOUNT FOR CASH JOURNAL
OBA7 DEFINE DOCUMENT TYPE FOR CASH JOURNAL
FBCJC1 DEFINE NUMBER RANGE INTERVAL FOR CASH JOURNAL DOC
FBCJC0 SETUP CASH JOURNAL
FBCJC2 CREATE/DELETE/CHANGE BUSINESS TRANSACTIONS
FBCJ CASH JOURNAL POSTING
FOREIGN CURRENCY REVALUATION
OB59 DEFINE VALUATION METHODS
FS00 CREATE GL ACCOUNTS – FC LOAN ACCOUNT WITH ACCOUNT
CURRENCY USD AND OPEN ITEM MANAGEMENT, FOREX PROFIT
AND FOREX LOSS
OBA1 PREPARE AUTOMATIC POSTINGS FOR FC VALUATION
(EXCHANGE RATE DIFFERENCE IN OPEN ITEMS – KDF &
EXCHANGE RATE DIFFERENCE IN FC BALANCES – KDB)
FS00 ATTACH THE EXCHANGE RATE DIFFERENCE KEY IN FC LOAN
ACCOUNT
OB08 ENTER EXCHANGE RATES
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F.05 VALUATION OF OPEN ITEMS IN FOREIGN CURRENCY (FOREX

RUN ON CLOSING DATE)
CONFIGURATION OF GL FAST ENTRY SCREEN
O7E6 MAINTAIN FAST ENTRY SCREENS FOR GL ACCOUNTS
FB00 ATTACH THE SCREEN IN F-02
ENJOY TRANSACTIONS
IMG DEFINE DOCUMENT TYPES FOR ENJOY TRANSACTIONS
(IMG>FA>GL>BT>GL POSTING>ENJOY>DEFINE DOC TYPE FOR
ENJOY SCREENS)
FB50 ATTACH THE DOC TYPE FOR ENJOY SCREEN

ACCOUNTS PAYABLE
OBD3 DEFINE VENDOR ACCOUNT GROUPS
XKN1 CREATE NUMBER RANGES FOR VENDOR ACCOUNTS
OBAS ASSIGN NUMBER RANGES TO VENDOR ACCOUNT GROUPS
OBA3 DEFINE TOLERANCE GROUPS FOR VENDORS
OBA7 DOCUMENT TYPES AND NUMBER RANGES
FS00 CREATE RECONCILIATION ACCOUNT – SUNDRY CREDITORS
XK01 CREATION OF VENDOR MASTER
F-43 VENDOR INVOICE POSTING
FBL1N VENDOR ACCOUNT DISPLAY
FK10N VENDOR ACCOUNT DISPLAY
BANK ACCOUNTING
FS00 CREATION OF BANK GL ACCOUNT
FI12 DEFINE HOUSE BANKS (ASSIGN BANK GL TO ACCOUNT ID)
FCHI CREATION OF CHECK LOTS
OUTGOING PAYMENTS
F-53 OUTGOING PAYMENT POSTING WITH CLEARING
FCH5 MANUAL CHECK UPDATION
FCHN CHECK REGISTER DISPLAY
FCH6 CHECK ENCASHMENT DATE UPDATE
FCHV DEFINE VOID REASON CODES FOR CHECK CANCELLATION
FCH3 UNUSED CHECK CANCELLATION
FCH8 ISSUED CHECK CANCELLATION
(RESETS THE CLEARED ITEM, CANCELS THE CHECK &
REVERSES THE PAYMENT)
DOWN PAYMENTS TO VENDORS (SPECIAL GL INDICATOR: ‘A’)
FS00 CREATION OF SPECIAL GL ACCOUNT – ADVANCES TO VENDORS
OBYR DEFINE ALTERNATIVE RECONCILIATION A/C FOR DOWN PMTS
(LINKING SUNDRY CREDITORS & ADVANCES TO VENDORS)
IMG SETUP ALL COMPANY CODES FOR PAYMENT TRANSACTIONS
(IMG>FA>AR&AP>BT>OUTGOING PMTS>AUTO OG PMTS>PMT
METHOD/BANK SELECTION FOR PMT PROGRAM)
F-48 DOWN PAYMENT POSTING
F-54 DOWN PAYMENT CLEARING
F-44 ACCOUNT CLEARING
VENDOR STATEMENT OF ACCOUNT
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OB78 ASSIGN PROGRAMS FOR CORRESPONDENCE

FB12 REQUEST FOR CORRESPONDENCE
F.64 MAINTAIN STATEMENT
CREDIT MEMOS
OBA7 DEFINE DOCUMENT TYPES
F-41 VENDOR CREDIT MEMO POSTING
TERMS OF PAYMENT
OBB8 MAINTAIN TERMS OF PAYMENT
OBXU DEFINE ACCOUNTS FOR CASH DISCOUNTS TAKEN
EXTENDED WITHHOLDING TAX
IMG CHECK WITHHOLDING TAX COUNTRIES
(IMG>FA>FAGS>WHT>EWHT>BASIC SETGS>CHCK WHT COUNTRIES)
IMG DEFINE WITHHOLDING TAX TYPE FOR INVOICE POSTING
(IMG>FA>FAGS>WHT>EWHT>CALCULATION>WHT TYPE)
IMG DEFINE WITHHOLDING TAX TYPE FOR PAYMENT POSTING
(IMG>FA>FAGS>WHT>EWHT>CALCULATION>WHT TYPE)
IMG DEFINE WITHHOLDING TAX CODES
(IMG>FA>FAGS>WHT>EWHT>CALCULATION>WHT CODES)
IMG DEFINE FORMULAS FOR CALCULATING WITHHOLDING TAX
(IMG>FA>FAGS>WHT>EWHT>CALCULATION>WHT CODES)
IMG ASSIGN WITHHOLDING TAX TYPES TO COMPANY CODE
(IMG>FA>FAGS>WHT>EWHT>COMPANY CODE)
IMG ACTIVATE EXTENDED WITHHOLDING TAX
(IMG>FA>FAGS>WHT>EWHT>COMPANY CODE)
OBWW DEFINE ACCOUNTS FOR WITHHOLDING TAX TO BE PAID OVER
XK02 ASSIGNMENT OF WITHHOLDING TAX CODES IN VENDOR MASTER
AUTOMATIC PAYMENT PROGRAM (FBZP)
OBVCU PAYMENT METHODS IN COUNTRY
OBVU PAYMENT METHODS IN COUNTRY CODE
OBVU ALL COMPANY CODES
OBVU PAYING COMPANY CODE
FI12 CREATE HOUSE BANKS
OBVCU BANK DETERMINATION (RANKING ORDER, BANK ACCOUNTS,
AVAILABLE AMOUNTS, VALUE DATE)
FCHI CREATION OF CHECK LOTS (SEQUENTIAL CHECKS)
F110 PAYMENT PROGRAM RUN (PARAMETERS, ADDITIONAL LOG,
SCHEDULE PROPOSAL, EDIT PROPOSAL, PRINTOUT/DATA
MEDIUM, MAINTAIN VARIANT, PRINT CONTROL, PAYMENT RUN,
SCHEDULE PRINT, OUTPUT CONTROLLER)
CONFIGURING FAST ENTRY SCREEN FOR INCOMING INVOICES
O7E5 DEFINE SCREEN TEMPLATES FOR INCOMING ITEMS
FB00 ATTACH THE SCREEN TEMPLATE IN F-43

ACCOUNTS RECEIVABLE
OBD2 DEFINE CUSTOMER ACCOUNT GROUPS
XDN1 CREATE NUMBER RANGES FOR CUSTOMER ACCOUNTS
OBAR ASSIGN NUMBER RANGES TO CUSTOMER ACCOUT GROUPS
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FS00 CREATE RECONCILIATION ACCOUNT – SUNDRY DEBTORS

XD01 CREATE CUSTOMER MASTER
OBA7 DOCUMENT TYPES AND NUMBER RANGES
F-22 SALE INVOICE POSTING
FBL5N CUSTOMER ACCOUNT DISPLAY
FD10N CUSTOMER ACCOUNT DISPLAY
F-28 INCOMING PAYMENT POSTING WITH CLEARING
PAYMENT DIFFERENCES, TERMS OF PAYMENT & DISCOUNTS
IMG DEFINE REASON CODES FOR PAYMENT DIFFERENCES
(IMG>FA>AP&AR>BT>INCOMING PMTS>IP GLOBAL SETTINGS)
OBB8 MAINTAIN TERMS OF PAYMENT
OBXT DEFINE ACCOUNTS FOR CASH DISCOUNTS GRANTED
OBXL DEFINE ACCOUNTS FOR OVER PAYMENTS/UNDER PAYMENTS
OB00 DEFINE ACCOUNTS FOR ROUNDING DIFFERENCES
DOWN PAYMENTS FROM CUSTOMERS (SPL GL INDICATOR: ‘A’)
FS00 CREATE SPECIAL GL ACCOUNT – ADVANCES FROM CUSTOMERS
OBXR DEFINE ALT RECONCILIATION A/C FOR CUSTOMER DOWN PMTS
(LINKING SUNDRY DEBTORS & ADVANCES FROM CUSTOMERS)
F-29 CUSTOMER DOWN PAYMENT POSTING
F-39 DOWN PAYMENT CLEARING
F-32 ACCOUNT CLEAR
BILL OF EXCHANGE TRANSACTIONS (SPL GL INDICATOR: ‘W’)
FS00 CREATE GL ACCOUNTS – SUNDRY DEBTORS BILL OF EXCHANGE
& BANK BILL DISCOUNTING
OBYN DEFINE ALT RECONCILIATION A/C FOR B/E RECEIVABLE
(LINKING SUNDRY DEBTORS & S/DEBTORS BILL OF EXCHANGE)
OBYK DEFINE BANK SUB ACCOUNTS (LINKING BANK CURRENT A/C,
SUNDRY DEBTORS A/C AND BANK BILL DISCOUNTING A/C)
OBXK DEFINE ACCOUNTS FOR BANK CHARGES
F-36 POSTING BILL OF EXCHANGE RECEIPT
F-33 BILL DISCOUNTING WITH BANK
S_ALR_87012213 BILL OF EXCHANGE MANAGEMENT (TO SEE CUSTOMER
WISE, DUE DATE WISE OUTSTANDINGS)
FBL3N BANK WISE OUTSTANDINGS
F-20 REVERSE CONTINGENT LIABILITY
DUNNING
OB61 DEFINE DUNNING AREAS
FBMP DEFINE DUNNING PROCEDURE
XD02 ASSIGN DUNNING PROCEDURE IN CUSTOMER MASTER
F150 DUNNING RUN
TAX ON SALES/PURCHASES
OBQ3 DEFINE PROCEDURES
IMG ASSIGN COUNTRY TO CALCULATION PROCEDURE
(IMG>FA>FAGS>TAX ON SALES/PURCHASES>BASIC SETTINGS)
FTXP DEFINE TAX CODES FOR SALES AND PURCHASES
FS00 CREATE GL ACCOUNT – SALES TAX PAYABLE
OB40 DEFINE TAX ACCOUNTS
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XD02 ASSIGN SALES TAX CODE IN CUSTOMER MASTER

FS00 ASSIGN TAX CODES IN SALES GL ACCOUNT (* FOR ALL TAX
CODES)
OPEN ITEM VALUATION FOR VENDOR/CUSTOMER ACCOUNTS
OB59 DEFINE VALUATION METHODS
OB09 DEFINE ACCOUNTS FOR EXCHANGE RATE DIFFERENCE
? FOREX RUN ON CLOSING DATE

ASSET MANAGEMENT
EC08 COPY REFERENCE CHART OF DEPRECIATION/DEP AREAS
OADB DEFINE DEPRECIATION AREAS
FTXP CREATE 0% TAX CODES FOR SALES AND PURCHASES
OBCL ASSIGN TAX CODES FOR NON TAXABLE TRANSACTIONS
OAOB ASSIGN CHART OF DEPRECIATION TO COMPANY CODE
IMG SPECIFY ACCOUNT DETERMINATION (NO SETTINGS REQD)
(IMG>FA>AA>ORG STRUCTURE>ASSET CLASSES)
IMG CREATE SCREEN LAYOUT RULES (NO SETTINGS REQD)
(IMG>FA>AA>ORG STRUCTURE>ASSET CLASSES)
AS08 DEFINE NUMBER RANGE INTERVAL
OAOA DEFINE ASSET CLASSES
FS00 CREATION OF GL ACCOUNTS (LIKE LAND, BLDGS, PLANT &
MACHINERY, FURNITURE&FIXTURES, VEHICLES, CAPITAL WORK
IN PROGRESS, ACCUMULATED DEPN FOR EACH ASSET, ASSET
SALE, PROFIT ON SALE OF ASSET, LOSS ON SALE OF ASSET,
LOSS DUE TO SCRAPPING, DEPRECIATION ACCOUNT ETC.)
OAYZ DETERMINE DEPN AREAS IN ASSET CLASSES
AO90 ASSIGN GL ACCOUNTS (INTEGRATION WITH GENL LEDGER)
OBA7 SPECIFY DOCUMENT TYPE FOR POSTING OF DEPRECIATION
OAYR SPECIFY INTERVALS AND POSTING RULES
OAYO SPECIFY ROUNDING OFF NET BLOCK AND/OR DEPRECIATION
IMG DEFINE SCREEN LAYOUT FOR ASSET MASTER DATA
(IMG>FA>AA>MASTER DATA>SCREEN LAYOUT)
AO21 DEFINE SCREEN LAYOUT FOR ASSET DEPRECIATION AREAS
DEPRECIATION KEYS
IMG DEFINE BASE METHOD (ALWAYS SELECT 0014 FOR SLM)
NO SETTINGS REQD (IMG>FA>AA>DEPN>VALUATION
METHODS>DEPN KEY>CALCULATION METHODS)
AFAMD DEFINE DECLINING BALANCE METHOD (ALWAYS SELECT 001)
NO SETTINGS REQD
AFAMS DEFINE MULTI LEVEL METHODS (FOR SLM & WDV)
AFAMP MAINTAIN PERIOD CONTROL METHODS
AFAMA MAINTAIN DEPRECIATION KEY (FOR SLM & WDV)
TRANSACTIONS
AS01 CREATE ASSET MASTER
AS11 CREATE SUB ASSET MASTER
F-90 ASSET PURCHASE POSTING (TRANSACTION TYPE 100 FOR
EXTERNAL ACQUISITION TYPE)
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F-90 SUB ASSET PURCHASE POSTING

AW01N ASSET EXPLORER
S_ALR_87011965 ASSET BALANCES BY BUSINESS AREA
F-92 ASSET SALE (RETIREMENT WITH REVENUE)
ABUMN ASSET TRANSFER (WITHIN COMPANY CODE)
ABAVN ASSET SCRAPPING
AFAB POSTING OF DEPRECIATION
CAPITAL WORK IN PROGRESS SETTLEMENT
OK07 DEFINE/ASSIGN SETTLEMENT PROFILE (CO ALLOCATION
STRUCTURE)
SNUM MAINTAIN NUMBER RANGES FOR SETTLEMENT DOCUMENTS
(ASSIGN VBCF ELEMENT GROUP TO STD ACCOUNTING DOC)
AIAB CAPITALIZE ASSETS UNDER CONSTRUCTION

MM – FI INTEGRATION
OMSK DEFINE VALUATION CLASSES
OBYC CONFIGURE AUTOMATIC POSTINGS

SD – FI INTEGRATION
VKOA PREPARE REVENUE ACCOUNT DETERMINATION
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Company: Smallest organizational unit for which individual

financial statements can be drawn up according to the
relevant commercial law. A company can consist of one or
more company codes. All company codes within a company must
use the same transaction chart of accounts and the same
fiscal year breakdown. The company code currencies, on the
other hand, can be different. A company code has one local
currency in which its transaction figures are recorded.

Company Code: The smallest organizational unit for which a

complete self-contained set of accounts can be drawn up for
the purposes of external reporting. The process of external
reporting involves recording all relevant transactions and
generating all supporting documents required for financial
statements (balance sheets, profit and loss statements and
so on.)

Business Area: 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.
Business areas are used in external segment reporting (over
and above company codes) based on the significant areas of
operation (for example, product lines) of a business
enterprise. A segment is an isolated area of activity.

All essential balance sheet items, such as fixed assets,

receivables, payables, and inventories, and all items of the
profit and loss statement can be assigned directly to a
business area. The balance sheet items for banks, capital,
and taxes, however, cannot be directly assigned to business
areas. They need to be assigned manually. This means that
business area financial statements cannot be drawn up for
commercial and tax law. Business area balance sheets and
income statements are used only for internal reporting
purposes.

The system determines the appropriate business area from

information such as the material, plant, or cost center we
enter in a business transaction like a goods movement.
Assignments we make (between cost centers and business areas
for example) or the combination of information we specify (a
plant and a particular division for example) are the basis
on which the system determines the appropriate business
area.
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Variant Principle:
The variant principle is a three step method used in R/3 to
assign special properties to one or more R/3 objects. The
three steps are: 1. Define the variant, 2. Populate the
variant with values, 3. Assign the variant to R/3 objects.
The principle is used for Field status, Posting periods,
fiscal years etc.

Fiscal year variant:

To separate business transactions into different periods, a
fiscal year with posting periods has to be defined. The
fiscal year is defined as a variant which is assigned to the
company code. The fiscal year variant specifies the number
of posting periods and special periods in a fiscal year and
how the system is to determine the assigned posting periods.

Types of Fiscal Years:

1. Year Dependent:
Periods can vary from year to year. A fiscal year variant
has to be defined as ‘year dependent’ if the start and the
end date of the posting periods of some fiscal years are
different from the dates of other fiscal years, or if some
fiscal years shall use a different number of posting
periods.
Shortened Fiscal Year: A shortened fiscal year arises
through a shift in the end of the fiscal year. The shortened
fiscal year covers the period between the end of the last
fiscal year in the old cycle and the beginning of the next
fiscal year in the new cycle.
Instances: Company changing the beginning of the fiscal year
or if the company was sold.

2. Year independent (Fiscal Year same as Calendar Year &

Fiscal Year not same as Calendar Year):
If each fiscal year of a fiscal year variant uses the same
number of periods, and the posting periods always start and
end at the same day of the year, the variant is called ‘year
independent’.

If the fiscal year is defined as the calendar year, the

posting periods are equal to the months of the year.
Therefore a calendar year variant must have 12 posting
periods.

If the fiscal year differs from the calendar year, we must

specify the number of posting periods we want to use & how
the fiscal year is to be determined from the posting date.
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To do this, we specify the displacement for each period

compared to the year of the posting date by using the annual
displacement indicators -1, +1. Using these indicators, the
system determines the fiscal year.

Chart of Accounts: The chart of accounts is a variant which

contains the structure and the basic information about
general ledger accounts.

Information to be given in Chart of Accounts: Maintenance

Language, Length of GL Account Number, Manual or automatic
creation of cost elements, Group chart of accounts etc.

Operative 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.

Country Specific Chart of Accounts:

These are structured in accordance with legal requirements
of the country in question

Group Chart of Accounts:

This is structured in accordance with requirements
pertaining to Consolidation.

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.
An account group must be assigned to each master record.

Retained Earnings Account: The difference in Profit and Loss

account is transferred to Reserves & Surplus

Posting Period Variant: A variant which contains posting

periods. A Posting Period is a period within a fiscal year
for which transaction figures are updated. Every transaction
that is posted is assigned to a particular posting period.
The transaction figures are then updated for this period.
During the time of the closing procedure, 2 period ranges
have to be open at the same time.

Open and Close Posting Periods: To define the periods those

are open for postings.
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Document Type: Key that distinguishes the business

transactions to be posted. The document type determines
where the document is stored, as well as the account types
to be posted. The Document Type controls the header which is
valid for an entire document.

Number Range: Defines the allowable range in which a

document number must be positioned and cannot overlap.
(Internal Numbering & External Numbering)

Tolerances: Rules that define acceptable differences during

Posting of transactions. Allowed Payment differences will be
specified in Tolerance Group for GL Accounts.

Tolerance Group for Employees is used to control the Upper

Limits for Transactions & Allowed Payment Differences.

Field Status Variant: The Field Status Variant contains

various Field Status Groups. In a Field Status Group each
field is defined whether it is ‘Required’, ‘Optional’ or
‘Suppressed’.

Master Data:
The Data which remains unchanged for long periods of time
and which is often referred to by other data. This data is
called Master Data.

Chart of Accounts segment:

The COA contains basic information about the accounts.
Information per account is bundled into what is called the
COA segment.
Contents: Account Group, P&L account type or Bal Sheet
account type, Description of the account Short text as well
as long text and Consolidation in COA like Trading partner
and Group Account Number.

Company Code Segment:

Information in this segment is specific for this company
code. This information controls entry of accounting
documents and management of accounting data.
Contents: Control Data, Bank/Interest, Information Tabs,
under these we specify currency, tax, reconciliation
account, sort key, field status group, house bank, interest
calculation information etc.,

Reconciliation accounts (Sub ledger open item function):

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Are General Ledger accounts assigned to the business partner

master records to record all transactions in the sub ledger.
Any postings to the sub ledger accounts automatically update
the balances of the assigned reconciliation accounts.

Methods for creating GL Accounts:

Manual: one step and two step
Copying: Copy an individual GL account with reference to
another GL account, Copy the entire company code segment,
copy the entire chart of accounts segment.
Data transfer: Upload a new chart of accounts from an
external system e.g. flat file.

Document:
The R/3 system uses the document principle: Postings are
always stored in document form. The document remains as a
complete unit in the system until it is archived.

A document is identified by the combination of

 Document number
 Company code
 Fiscal year
The R/3 FI document consists of
 A document header (information which applies to the
entire document & the important control key is
‘document type’ for the header)
 2 to 999 line items (information which is specific to
that line item & the important control key is ‘posting
key’ for the line item).

When a document is displayed, the first screen we see is an

overview screen containing the most important information
from the document header and the line items. We have a
display line for each line item.

We can decide what data is displayed in this line by

specifying the line layout. We can define several variants
for line layout. When displaying a document, we can switch
between the variants. We can define our own variant by
selecting from Current Display Variant.

GL Account Blocking:
Blocked for Creation
Blocked for Posting
Blocked for Planning
Blocked for Posting (in Company Code)
13 of 33 12/8/2021

Hold Documents: (System will prompt for a temporary document

number to be given by the user)
We can enter incomplete documents by using the Hold
function. If we do this, the system does not update any
account balances.

Sample Documents: Sample Document is a special type of

reference document. Data from this document is used to
create default entries on the accounting document entry
screen. A sample document does not update transaction
figures but merely serves as a data source for an accounting
document.

Steps:
 Creation of Number Range Group X2 and Numbers for
Sample Document Template
 Creation of Sample Document Template
 Posting of Entries by using Sample Document as
reference

Recurring Documents: A periodical recurring posting made by

the recurring entry program on the basis of recurring entry
original document. The procedure is comparable with a
standing order by which, banks are authorized to debit rent
payments, payment contributions or loan repayments.

Steps:
 Creation of Number Range Group X1 and Numbers for
Recurring Document Template
 Creation of Recurring Document Template
 Posting of Documents by using Recurring Document
Template by way of Batch Input

Accrual/Deferral Documents: To ensure that expenses and

incomes are posted to the correct period, we enter
accrual/deferral documents.
Accruals: An accrual is any expenditure before the closing
key date which represents an expense for any period after
this date.
Deferral: Deferred income is any receipt before the closing
key date which represents revenue for any period after this
date.
14 of 33 12/8/2021

Steps:
 Creation of Reversal Reason which will allow reversing
on any day
 Posting of Accrual/Deferral Document
 Reversal of Accrual/Deferral Document

Open item management:

GL accounts should be administered with open item management
when we need to check whether there is an offsetting posting
for a given business transaction. Open and cleared items
can be displayed separately, and therefore it is easy to see
which business transactions still need to be cleared.
Examples: GR/IR Clearing A/c., Cash Discount Clearing A/c.,
Bank Clearing A/cs. etc.

Note: Reconciliation accounts are managed implicitly using

Sub Ledger Open Item Function.

Clearings:
 Full Payment Clearing
 Partial Payment Clearing
 Residual Clearing

Document Reversal:
Reversal of a posting by entering an identical amount to the
opposite side of the account, thereby offsetting the
original amount.

 Individual Reversal
 Reversal of Reversal
 Mass Reversal
 Cleared Item Reversal
 Accrual/Deferral Reversal

Currencies:
In Financial Accounting, we have to specify for each of the
company codes, in which currency ledgers should be managed.
This currency is the national currency of the company code,
that is, the local currency (or company code currency).
From a company code view, all other currencies are then
foreign currencies.
The ledgers can be managed in two parallel currencies in
addition to the local currency, for example, group currency
or hard currency. Group currency is used in the consolidated
financial statements. Hard Currency or Country-specific
15 of 33 12/8/2021

second currency is used in countries with high rates of

inflation.
Global company Currency: Currency used for an internal
trading partner. Global company currency is defined when
defining the company that is assigned to the company code.

Exchange Rate Type: - Key used to define exchange rates in

the system.
For each currency pair we can define different exchange
rates.
The different exchange rates are used for the purposes of
Valuation, Conversion, Translation, Planning etc.
Standard Translation at Bank Buying rate – G Type
Standard Translation at Bank selling rate – B Type
Average rate – M Type
Historical exchange rate - 1003

Translation Ratio: The (consistent) relationship between the

monetary units of two foreign currencies.

Foreign Exchange Revaluation

G Type – Bank Buying
 Open Item
 Non Open Item
B Type – Bank Selling
 Open Item
 Non Open Item
We can create different valuation methods for valuing
foreign currency. For each valuation method, we have to
define:
 Parameters for the valuation procedure
 Parameters for exchange rate determination

Valuation Method: A unique key determining foreign currency

valuation method.

Interest Calculations
 S Type – Balance Interest Calculation (for GL Accounts)
o Is applied to the entire balance of a GL or
Customer Account, applying a particular interest
rate for a specified period of time
 P Type – Item Interest Calculation (for Customers &
Vendors)
o Interest on arrears is applied to individual items
in accounts receivable or accounts payable. A
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certain interest rate is applied to the items that

are still open or unpaid at a specified date.

Interest calculation configuration:

 Interest calculation Indicator
o Interest calculation types set basic parameters
used in calculation. To calculate interest for an
account (GL, Customer, Vendor), the master data
for that account must include the interest
calculation indicator that applies. Each interest
ID must be assigned an interest calculation type,
indicating whether it is used for balance interest
calculation or item interest calculation.
 General terms
o General terms specify further parameters about how
each interest calculation indicator works.
o Here we specify interest calculation ID, interest
calculation frequency, settlement day, calendar
type (G type for rupee loans & F type for FC
loans).
 Define reference interest rates
o Define reference interest rate ID, ‘effect from
date’ and ‘currency’
 Time dependent terms
o Time-based terms set validity dates and
relationships to interest rates. Here we specify
interest calculation ID, currency, valid from,
sequence number(1&2 - credit interest balance
interest calculation for 1 & debit interest
balance interest calculation for 2), term and
reference interest rate ID.
 Interest rates
o Interest rates establish reference interest rates
that interest calculations can be tied to. Here
we specify Reference interest rate ID, valid from
and interest rate.
 Account determination
o Account determination establishes which accounts
the results of an interest calculation will be
posted to.

Accounts Payable
Reconciliation accounts:
Reconciliation accounts are managed implicitly using Sub
Ledger Open Item function.
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Posting Keys
Vendor Debit: 25
Vendor Credit: 31

Document Types
KR – Vendor Invoice
KZ – Vendor Payment
KA – Vendor Document (Transfers/Reversals)

AP (Vendor Accounts) is a Subsidiary Ledger of Sundry

Creditors & Sundry Creditors is a Reconciliation Account
under Current Liabilities.

Steps:
 Creation of Vendor Account Groups like FI Vendors
(Services), MM Vendors (Materials) and One-time Vendors
with Reconciliation Account Field mandatory.
 Creation of Number Range Groups and Numbers for
Vendors.
 Assignment of Number Range Group to Vendor Account
Group
 Define Tolerance Groups for Vendors.
 Creation of Vendor Master.
 Document Types and Number Ranges for KR, KZ and KA.

The Vendor Account Group controls 

The number ranges of the accounts, the status of the fields
in the master record and whether the account is a one time
vendor

One-time Vendor:
Vendors who have a business transaction only once are called
one-time vendors. We create collective master record for
one-time vendors. The complete details of the Vendor will be
given at the time of Invoice Posting. (While creating the
group a ‘One-time Vendor Group’ should be selected.)

Tolerances: Rules that define acceptable differences during

posting
Tolerance Groups for Vendors:
The tolerances are used for differences in payment and
residual items which can occur during payment settlement. We
can specify the tolerances under one or more tolerance
groups. Allocate a Tolerance Group to each Vendor via the
master record. For each Tolerance Group we specify:
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1. Tolerances upto which differences in payment are posted

automatically to expense or revenue account when
clearing open items.
2. The handling of the terms of payment for residual
items, if they are to be posted during clearing.

Employee Tolerances also can be specified. Employee

Tolerance is used to control the Upper limits for posting
procedures (Posting Authorizations) and Permitted Payment
Differences. While clearing, the lower limit of the 2 will
be taken.

Vendor Master:
The account group is entered on the initial create screen.
In FI, once the vendor account is created, its account group
cannot be changed.
Give Reconciliation Account Number, Sort Key 012 Vendor
Name, Payment Terms, Tolerance Group & Select ‘Check Double
Invoicing’.

Line item display and open item management are always preset
to “on” for every vendor account.

A complete Vendor Account consists of 3 segments – 1.

General Data at the client level 2. Company code segment and
3. Purchasing Organization segment

General data consists Address, Control data, Payment

transactions etc. The account number is assigned to the
Vendor at the client level. This ensures that the account
number for a Vendor is the same for all company codes and
sales areas.

Company data consists of Accounting information, Payment

transactions, Correspondence, Insurance, Withholding tax
etc.

Note: If MM creates their segment of the master record and

then FI creates their segments of the master record, there
is the risk of creating incomplete or duplicate master
records. To find and correct these incomplete accounts, we
can run report RFKKAG00 and make the necessary corrections.
Creation of duplicate accounts can be prevented by:
 Using the matchcode before creating a new account
 Switching on automatic duplication check

Important Fields
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 Search Item: Should be filled with a short version of

the vendor name according to company rules/desires. An
additional search field also can be filled up.
 Group Key: Vendors who belong to one corporate group
can be bundled together by a user-defined group key.
This group key can be used for running reports,
transaction processing or for matchcodes.
 Accounting clerk: The accounting clerk’s name has to be
stored under an ID and this ID can be entered in the
vendor master record of the account he or she is
responsible for. The accounting clerk’s name is then
printed on correspondence and this ID is used to sort
dunning and payment proposal lists.

Down Payments to Vendors

 Create Special GL Account ‘Advance to Vendors
(Reconciliation Account)’ under Current Assets
 Create Link between ‘S/Creditors’ and ‘Advance to
Vendors’ (Special GL Indicator: A)
 Down Payment Posting
 Purchase Invoice Posting
 Transfer of Down Payment from Special GL to Normal item
by clearing Special GL Account
 Clearing of Normal Item

Extended Withholding Tax (TDS)

In Accounts Payable, the vendor is the person subject to
tax, and the company code is obligated to deduct withholding
tax and pay this over to the tax authorities on their (the
vendor’s) behalf.

At the time of Invoice Posting

Service Charges A/c. Dr. 100000
To Contractors A/c. 98000
To TDS A/c. 2000

At the time of Advance Payment Posting

Contractors A/c. Dr. 100000
To Bank A/c. 98000
To TDS A/c. 2000

Terms of payment
Terms of payment are conditions established between business
partners to settle the payment of invoices. The conditions
define the invoice payment, due date and the cash discount
offered for early settlement of the invoice.
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Automatic Payment Program (FBZP)

Every company needs some way to pay their vendors. The
automatic payment program is a tool that will help users
manage payables. Accounts payable invoices have to be paid
on time to receive possible discounts.

The settings are divided into the following categories:

All company codes
 Inter-company payment relationships
 The company code(s) that process payments
 Cash discounts
 Tolerance days for payments
 The customer and vendor transactions to be processed
Paying company codes
 Minimum amounts for incoming and outgoing payments
 Forms for payment advice and EDI (Electronic Data
Interchange)
 Bill of Exchange parameters
Payment methods / country
 Methods of payments such as Cheque, Bank Transfer etc.
 Define the basic requirements and specifications for
each payment method
 Create a Cheque, bank transfer, bill of exchange, etc.
 Master record requirements, i.e. address required
 Document types for postings
 Print programs
 Permitted currencies
Payment methods / company code
Define for each payment method and company code
 Minimum and maximum payment amounts
 Whether payments abroad and foreign currencies are
allowed
 Grouping options
 Bank optimization
 Forms for payment media
Bank Determination
These components need to be taken into consideration when
selecting the paying house bank …
 Ranking order (per pmt method, define, 1. which house
bank should be considered for payment first, second,
third, etc., 2. Currency, 3. Bill of exchange)
 Accounts & Amounts (per house bank and payment method
combination, define, 1. The offset account to the sub-
21 of 33 12/8/2021

ledger posting, 2. Clearing accounts for bills of

exchange 3. The available amount of funds in each bank)
 Charges (Assess additional bank charges for incoming
and outgoing payments, Used with bills of exchange,
Additional automatic posting configuration)
 Value date (per house bank and payment method
combination, value date is … 1. Used with cash
management and forecast 2. The number of “days until
value date” plus the posting date)

Payment Run (F110)

Parameters: In this step, the following questions are asked
and answered
 Who is going to be paid?
 What payment methods will be used?
 When will they be paid?
 Which company codes will be considered?
 How are they going to be paid?
Proposal: Once the parameters have been specified, the
proposal run is scheduled and it produces a list of business
partners and open invoices that are due for payment.
Invoices can be blocked or unblocked for payment.
Program: Once the payment list has been verified, the
payment run is scheduled. A payment document is created and
the general ledger and sub-ledger accounts are updated.
Print: The accounting functions are completed and a separate
print program is scheduled to generate the payment media.

Accounts Receivable
Posting Keys
Customer Debit: 01
Customer Credit: 15
S/Debtors Bill of Exchange Debit: 09
S/Debtors Bill of Exchange Credit: 19

Document Types
DR – Customer Invoice
DZ – Customer Payment
DA – Customer Document (Transfers/Reversals)

AR (Customer Accounts) is a Subsidiary Ledger & Sundry

Debtors is a Reconciliation Account under Current Assets.

Steps:
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 Creation of Customer Account Groups like FI Customers

and SD Customers with Reconciliation Account Field
mandatory.
 Creation of Number Range Groups and Numbers for
Customers.
 Assignment of Number Range Group to Customer Account
Group.
 Creation of Customer Master.
 Document Types and Number Ranges for KR, KZ and KA.

The Customer Account Group controls 

The number ranges of the accounts, the status of the fields
in the master record and whether the account is a one time
customer.

Customer Master
The account group is entered on the initial create screen.
In FI, once the customer account is created, its account
group cannot be changed.
Select Company Code Data Button - Give Reconciliation
Account Number, Sort Key 012 Vendor Name, Payment Terms,
Tolerance Group & Select ‘Check Double Invoicing’.

Line item display and open item management are always preset
to “on” for every customer account.

A complete Customer Account consists of 3 segments – 1.

General Data at the client level 2. Company code segment and
3. Sales Area segment

General data consists Address, Control data, Payment

transactions etc. The account number is assigned to the
Customer at the client level. This ensures that the account
number for a customer is the same for all company codes and
sales areas.

Company data consists Accounting information, Payment

transactions, Correspondence, Insurance, Withholding tax
etc.

Note: If SD creates their segment of the master record and

then FI creates their segments of the master record, there
is the risk of creating incomplete or duplicate master
records. To find and correct these incomplete accounts, we
can run report RFDKAG00 and make the necessary corrections.
Creation of duplicate accounts can be prevented by:
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 Using the matchcode before creating a new account

 Switching on automatic duplication check

Important Fields
 Search Item: Should be filled with a short version of
the customer name according to company rules/desires.
An additional search field also can be filled up.
 Group Key: Customers who belong to one corporate group
can be bundled together by a user-defined group key.
This group key can be used for running reports,
transaction processing or for matchcodes.
 Accounting clerk: The accounting clerk’s name has to be
stored under an ID and this ID can be entered in the
customer master record of the account he or she is
responsible for. The accounting clerk’s name is then
printed on correspondence and this ID is used to sort
dunning and payment proposal lists.

Down Payments from Customers

 Create Special GL Account ‘Advances from Customers
(Reconciliation Account)’ under Current Liabilities
 Create Link between ‘S/Debtors’ and ‘Advances from
Customers’ (Special GL Indicator: A)
 Down Payment Receipt Posting
 Sale Invoice Posting
 Transfer of Down Payment from Special GL to Normal item
by clearing Special GL Account
 Clearing of Normal Item

Bills of Exchange
 LC (Letter of Credit – 30/60/90 days sight)
 Contingent Liability
 Bills Discounted with Bank
 ‘W’ is the Special GL Indicator (‘W’ stands for ‘Bill
of Exchange Bankable’)

Bills of Exchange Transaction

Normal Accounting SAP Accounting
Customer A/c. Dr. Customer A/c. Dr. (S/Debtors Debit)
To Sales A/c. To Sales A/c.
Bill of Exchange Bill of Exchange Receipt –
Receipt – Customer (W) A/c. Dr. (S/Drs.
No Entry BExchnge A/c. Debit)
To Customer A/c. (S/Drs. With
clearing)
24 of 33 12/8/2021

Discounting – Discounting –
Bank A/c. Dr. Bank A/c. Dr.
Interest A/c. Dr. Interest A/c. Dr.
To Bill To Bank Bill Discounting A/c.
Discounting A/c.
Reversal of Reversal of Contingent Liability -
Contingent Liability Bank Bill Discounting A/c. Dr.
Bill Discounting A/c. To Customer (W) A/c. (S/Drs. Bill
Dr. of Exchange with clearing)
To Customer A/c.
Reports – Reports within the system –
Customer wise, Due Customer wise, Due Date wise, Bill
Date wise, Bill wise wise within the system
outside the system

Dunning
System defined reminder letters
Dunning Area: South, North, East, West
Dunning Levels: 4 (Maximum levels 9)
Dunning Frequency: 10/20/30 days
Grace Period: 3/4/5 days

The Dunning Program settings are divided into the following

categories:
 Dunning Procedure
o Define the key for the dunning procedure to be
used
o Give a description for the dunning procedure
o Define dunning interval in days
o Specify minimum days in arrears after which a
dunning notice will be sent
o Grace period per line item
o Interest calculation indicator for calculation of
dunning interest
 Dunning levels (Each item to be dunned gets a dunning
level according to its days in arrears)
o Define minimum number of days, referring to the
due date of net payment, to reach a certain
dunning level
o Define whether interest is to be calculated
o Define print parameters
 Charges
o Define dunning charges, depending on the dunning
level
o Dunning charges can be either a fixed amount or a
percentage of the dunned amount
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o A minimum amount for the dunning charges can be

set
 Minimum amounts
o Define minimum amount or percentage of the overdue
items to reach a dunning level
o Minimum amount to be reached in order to calculate
interest per dunning level
 Dunning texts
o Define the name of the form that will be used at
each dunning level
 Environment
o Company code data
o Sort fields
o Sender details
o Dunning areas
o Dunning keys (A dunning key determines that the
line item can only be dunned with restrictions or
is to be displayed separately on the dunning
notice. By assigning dunning keys to certain items
we can prevent these items from exceeding a
certain dunning level.)
o Dunning block reasons ( A dunning block prevents
accounts and items to be dunned)
o Interest
o Dunning grouping

Steps in Dunning Run

 Maintain Parameters (specify the accounts and documents
that are to be considered in the dunning run)
 Proposal Run
 Editing Proposal
 Printing Dunning Notices

Sales Tax
Input Tax or Purchase Tax
Base 100
2% Tax 2
----
Inventory RM 102
----
Output Tax or Sales Tax
Base Price 100 Sales Account
4% ST 4 ST Payable Account
----
104
----
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Assets
 Subsidiary Ledger
 Chart of Depreciation – Copy Germany Chart of
Depreciation
 Depreciation Areas – Book, Tax, Consolidated and
Costing
 Depreciation Methods – Straight Line Method and Written
Down Value Method
 Depreciation Keys – Rate + Method
5% SLM, 5%WDV etc.

Rules:
 Sub Asset Master is to be created WRT Main Asset Master
 Main Asset Master is to be created WRT Asset Class
 In Asset Class we mention Account Determination
 For Account Determination we assign Accounts on the
basis of Transaction like Purchase, Sale, Profit, Loss,
Scrapping, Depreciation, Accumulated Depreciation etc.

Transaction Account Asset Class Asset Sub

Determination Masters Asset
Masters
Land Free Hold
Land
Lease Hold
Land
Buildings Factory
Buildings
Non Factory
Purchase, Bldgs.
Sale, Profit, Plant & Department A Machine Motor
Loss, Machinery Department B No.1
Scrapping, Department C
Depreciation, Furniture & Furniture &
Accumulated Fixtures Fixtures
Depreciation Office
etc. Equipment
Vehicles Indigenous
Vehicles
Imported
Vehicles
Capital Work Expansion 1
in Progress Expansion 2
Expansion 3
27 of 33 12/8/2021

System defined Account Determinations and Screen Layout

Rules:
Description Screen
Account
Layout
Determination
Rule
Real Estate and Similar Rights 10000 1000
Buildings 11000 1100
Machinery and Equipment 20000 2000
Furniture & Fixtures 30000 3000
Vehicles 31000 3100
Hardware (IT) 32000 3200
Down Payments paid and Assets under
40000 4000
Construction
Low Value Assets 50000 5000
Leasing 60000 6000
Objects of Art 80000 8000

Depreciation Keys
 Define Base Method (SLM 0014)
 Define Declining Balance Method (WDV 001)
 Define Multi Level Method
 Define Period Control Method
 Define Depreciation Key

Financial Statement Version (FSV)

Summary, Schedules and Accounts

We define a financial statement version in 2 steps:

1. Enter in the directory of financial statement versions
2. Define hierarchy levels and assign accounts
Each version must have the following special items:
1. Assets
2. Liabilities
3. Profit
4. Loss
5. Profit and Loss results
6. Accounts not assigned
The ABAP/4 program RFBILA00 calculates the balance sheet
profit/loss from the assets and liabilities totals and
enters the result in the “Balance sheet results profit/loss”
item. The profit and loss statement results are determined
from all accounts not assigned to either assets or
liabilities, and are entered in the proper item.
28 of 33 12/8/2021

 A financial statement version consists of a maximum of

10 hierarchy levels
o Assign items to each level. The system calculates
a total/subtotal for each item which is then
displayed when the program is run.
o Assign texts to each item.
o Assign the accounts whose balance and account name
are to be listed to the lowest levels.

Closing Procedure
Month-end closing activities (Preparatory activities)
HR – Payroll posting
MM – Maintain GR/IR clearing account
Material valuations
Close material ledger
Close material master
SD - Goods issues/invoices (Verify that all postings for the
period have been generated)
FI – Accrual/Deferral postings
Recurring Entries
Depreciation posting
Interest
AuC settlement
Close old period & open new period
CO - Cost Centers:
- Imputed costs, Distribution and assessment, indirect
activity allocation, Calculate actual activity prices
and update allocations
Internal Orders:
- Overheads
- Settlement (For external settlement to AA or FI, re-
open appropriate GL A/cs)
Production orders:
- Overheads
- WIP calculation
- Variance calculation
- Settlement
Profitability Analysis:
- Cost center assessments
- Activity based costing
- Allocations
Lock old posting period for Controlling transactions

Month-end closing activities (Financial closing)

FI - Re-open periods for adjustments
29 of 33 12/8/2021

CO/FI reconciliation postings (Cross-company code,

cross-business area and cross-functional area flows
within CO are posted to FI)
Foreign currency open item valuation
Accounting > Financial Accounting > Accounts receivable
> Periodic Processing > Closing > Valuate > Valuation
of Open Items in Foreign Currency
Foreign currency balance sheet account valuation
Accounting > Financial Accounting > GL Accounts >
Periodic Processing > Closing > Valuate > Valuation of
Open Items in Foreign Currency
FI/PCA Balance sheet adjustment
FI/CO-PA Profit and loss adjustment
Final closing of posting periods
Final Reporting:
- Compact document journal
- Financial statements
- Taxes on sales/purchases
- Balance audit trial

Year-end closing activities (Preparatory activities)

In addition to the regular month-end closing activities for
the final period of the fiscal year to be closed, the
activities to be performed for year-end closing process
include:
MM - Physical inventory procedure (Year-end or as required)
Inventory valuations – lowest value determination,
LIFO, FIFO (After closing the postings in MM for the
fiscal year)
CO - PP – Material valuation from new material cost
estimates
FI - FI - Open new fiscal year
AR/AP – Balance confirmations
AA – Fiscal year change
FI – Balance carryforward
AA – Valuations & Capital investment subsidies (after
AA postings completed for fiscal year)
AA – Year-end closing
AR/AP – Close fiscal year

Year-end closing activities (Financial closing)

FI - Analyze GR/IR postings
Regroup receivables/payables
General adjustments
Final fiscal year closing
30 of 33 12/8/2021

GL – Account balances – old fiscal year to new fiscal

year (Reconcile carry forward balances with prior year
final balances)
FI/CO/AA – Final reporting (same as monthly + Account
balances year-end)
AA – Asset history sheet
Accumulated balance audit trial

Cross Company Code

Transactions
A cross company code transaction involves 2 or more company
codes in one business transaction. For a cross company code
transaction, the system will post a separate document in
each of the company codes involved.

Examples for cross company code transactions are:

 One company code makes purchases for other company
codes (Central Procurement)
 One company code pays for other company codes (Central
Payment)
 One company code sells goods to other company code

Steps:
 Create Clearing Accounts in each of the company codes.
The Clearing Accounts may be GL Accounts, Customer or
Vendor Accounts.
 Configure the Automatic Postings for Cross Company Code
Transactions by assigning Clearing Accounts for both
the company codes.

Creation of Clearing Accounts in both the Company Codes

(FS00)
In Company Code # 1 In Company Code # 2
Account Group Current Assets Current Liabilities
Balance Sheet Account Balance Sheet Account
Short Text Clearing with CC2 Clearing with CC1
Long Text Clearing with Company Clearing with Company
Code 2 Code 1
Account INR INR
Currency
Only Bal in Local Only Bal in Local
Currency Currency
Line Item Display Line Item Display
31 of 33 12/8/2021

Sort Key 001 001

Field Status G001 G001
Group
Post Automatically Post Automatically
Only Only

Cash Journal
 The Cash Journal is a Bank Accounting subledger for the
management of cash in a business. It can be used
independently of other posting transactions.
 Cash journal entries are saved locally in the cash
journal subledger. All balances are automatically
calculated and displayed.
 The cash journal entries saved are posted to the GL.

Integration

MM FI Integration
Material Types
ROH Raw Material
ERSA Stores & Spares
VERP Packaging Material
FERT Finished Goods
HALB Semi Finished Goods
HAWA Traded Goods
DIEN Services

Views
Basic View, Purchase View, Production View, Sales View,
Quality View, Accounting View, Costing View, MRP View, Plant
View etc.

Creation of Material Master (MM01)

Logistics > Material Management > Material Master > Material
> Create General > Immediately

Accounting Views (MM03)

Fields: 1) Valuation Category 2) Valuation Class 3) Price
Control
Valuation Category: Batch Classification & Average
Valuation Class: For Raw Material  Indigenous and Imported
32 of 33 12/8/2021

Rules:
 The Material Master is to be created wrt Material Type
 In the Material Master we assign the Valuation Class
 For Valuation Class we assign the GL Masters based on
the type of Transaction

Price Control
SPRO > Material Management > Valuation & Account Assignment
> Define Price Control for Material Types
S – ‘Standard Price’, will be used for ‘Finished Goods’
V – ‘Moving Average’, will be used for ‘other than Finished
Goods’

MM FLOW
1. Purchase Requisition – No FI Entry
2. Enquiry, Quotation and Price Comparison – No FI Entry
3. Purchase Order – No FI Entry
4. Purchase Order Release Procedure – No FI Entry
5. Goods Receipt (Will be taken wrt PO) -
Inventory RM Local A/c. Dr (BS – CA) BSX
To GR/IR Clearing A/c. (BS – CL) WRX
6. Invoice Verification –
GR/IR Clearing A/c. Dr (BS – CL) WRX
To Vendor A/c. (BS – CL) P.O.
7. Consumption –
RM Consumption Local A/c. Dr (P&L Dr) GBB-VBR
To Inventory RM Local A/c. (BS – CA) BSX
8. Production Receipt –
Inventory FG A/c. Dr (BS – CA) BSX
To Increase/Decrease in Stocks FG (P&L Cr) GBB-
ZOB
9. FG Delivery –
Increase/Decrease in Stocks FG Dr (P&L Cr) GBB-
VAX
To Inventory FG (BS – CA) BSX
10. Billing – SD Area

FI MM Integration Settings (OBYC)

SPRO > Material Management > Valuation and Account
Assignment > Account Determination > Account Determination
without Wizard > Configure Automatic Postings (OMWB)
Cancel the existing Plant
Select ‘Account Assignment’ Button (OBYC)

SD FI Integration
33 of 33 12/8/2021

SD FLOW
1. Enquiry/Quotation – No FI Entry
2. Sales Order – No FI Entry
3. Delivery – Without PGI & With PGI
Increase/Decrease in Stocks A/c. Dr GBB – VAX
To Inventory FG BSX
4. Billing -
Party A/c. Dr SO
Commission A/c. Dr ERS
To Sales – Export A/c. ERL
To Freight Collection A/c. ERF

Pricing Procedure VK11 Condition Type: KOFI

Material ERS
Region to Region ERL
Tax Code ERF

SD FI Integration (VKOA)
SPRO > Financial Accounting > General Ledger Accounting >
Business Transactions > Integration > Sales and Distribution
> Prepare Revenue Account Determination
Double Click 003 Material Group Account Key
Application Area: V Sales/Distribution
Condition Type: KOFI
Account Assignment Goods Account Key
Trading Goods ERL Revenue
Finished Goods ERS Sales Deductions
Services ERF Freight Revenue