BUSINESS BLUEPRINT

OF
NISHCHAY GROUP OF COMPANIES

NAME: - VINAY BANGRAWA

MOBILE NO: - 6350585025
 IMPLEMENTATION SCOPE

Objectives

In order to ensure that the Company’s growing capabilities are leveraged to its
full strengths it is felt that the Company should migrate to SAP system to ensure
that systems are in place to meet the dynamic requirements of its customers.

Approach

SAP has a proprietary implementation methodology called Accelerated

SAP(ASAP), which will be used as the base approach for the implementation.
ASAP is a solution from SAP to streamline customer implementations and
deliver faster business results. ASAP incorporates step-by-step approach and
avoids non-value-added tasks. ASAP provides a base line for business process
requirements, configurations, testing and end user training.

Organization Structure & Basic Settings

PATH:
 SPRO
 Enterprise Structure
 Definition
 Financial Accounting
 Definition
 Assignment
1.1 Company (OX15)
Company is an organizational unit which represents a business
organization for which financial statements can be drawn according
to the relevant commercial law. A Company can consist of one or
more Company codes.
Company NC01
Company Name Nishchay Group Of Company

1.2 Credit Control Area (OB45)

A credit control Area is an organizational unit that represents an
area responsible for granting and monitoring Credit limits for
customers. It can include one or more company codes.

Cred. Contr. NC01 Nishchay Group Of Company

Area
Currency INR
Credit Limit 1,50,00,000

When we have both Company code and Credit Control Area then we
will assign company code to credit control area. (T-code: OB38)

Company/Client

Credit Control GLOBAL SETTINGS Business Area

Company Codes
Area
1.3 Company Code (OX02)

Company code is the Legal entity of Financial Accounting for which

you draw individual financial statements for the purpose of external
statutory reporting. It is a four-character alphanumeric code.

Company Code NC01

Company Name Nishchay pvt. Ltd.

Then Company code is assigned to Company (T-code: OX16)

Company/Client

Company Codes

1.4 BUSINESS AREA (OX03)

Business Area can be geographical or product wise. It is used to

derive financial report by different segments.

Business Area Description

NC01 Race Cars
NC02 Race Bikes

1.5 Functional Area (OKBD)

Function areas in finance accounting are used to define the expenses

in a company according to individual function units.
 Functional Area Name
NCFA Manufacturing

1.6 Consolidated Business Area (OCC1)

Consolidated business area are organizational units. These areas are

formed for a fixed area of activity or responsibility within a company.
In other words, consolidated business area is the business segment
within a company.

Cons. Business Area Description

NCCB Automobile

1.7 Financial Management (FM) Area (OF01)

FM area in SAP is an organisational unit that organises the company

from aspect of cash management and funds management. We can
assign one or more company codes to a FM area in SAP.

FM area FM area text FM area currency

NCFM FM area for NCFM INR

GLOBAL SETTINGS

2.1 Field Status Variant (OBC4)

Field Status Variant and Field Status Group are important

controlling feature of SAP. With the help of them we are able to
control the fields which will be required optional or suppressed
during the transactions in SAP.
 Assign Company code to field status variant (T-code: OBC5)

FStV Field Status Name

NC01 Field Status for Nishchay

2.2 Fiscal Year Variant (OB29)

A Fiscal year is the period for which financial statements are
prepared. It generally consists of 12 months. A Fiscal year can
contain special periods that can be posted to for any year-end
transactions such as provisions, adjustments, etc. Several Company
codes can use the same fiscal year variant. The fiscal year “V3”
consisting of 12 Normal periods (from April to March) with 4 Special
periods to manage year end entries.
To Assign Company code to a fiscal year (T-code: OB37).

FV Description
N3 Apr.-march, 4 special periods

2.3 Posting Period Variant (OBBO)

A Posting period is a period (either a month or a special posting

period) into which financial documents are posted. Multiple Company
codes can use the same posting period variant. Account Types, range
of accounts, authorization groups can be specified to control
document postings in a particular posting period.
Assign Variant to company Code (T-code: OBBP)

Variant Name
NC01 Posting period variant for
Nishchay

Var. A From To From Year To Year

acct acct per. 1 period
 NC01 + zzzzz 1 2021 12 2022

A:- Select Account Type (A)

+ = Valid for all Account Types (masking)

A = Assets
D = Customers (A/R)
K = Vendors (A/P)
M = Materials
S = General Ledger Accounts.

2.4 Document Types/ Number Ranges (FBN1)

Document Type Key is used to distinguish between different business

transactions and to classify the accounting documents. It is also used to
determine the number range for documents and account types such as asset,
material, vendor, etc. for posting.

Common Document Type Keys are as follows −

Document Type Document Type Description

AA Asset Posting

AN Net Asset Posting

DR Customer Invoice

DZ Customer Payment

KA Vendor Document

KG Vendor Credit Memo

Document Number Range

Path –

SPRO → SAP Reference IMG → Financial Accounting → Financial

Accounting→ Global Setting → Document → Define Document Number
Ranges → Execute.

Document number ranges are defined at specific interval with in which

documents should be created. The number range becomes effective by the
document type specified in document entry and posting. (T-code: FBN1)
No. Year From No. To No. Current EXT
No
NC 9999 01 999999999

GENERAL LEDGER ACCOUNTING

2.5 Chart Of Accounts (OB13)

Chart of Accounts is an organized list of all general ledger accounts
used by one or more company codes. Multiple Company codes can
use the same Chart of Accounts. The Chart of Accounts shall be
maintained in English language.
 Chart of Accts Chart of Accts Description
NC01 Chart of Acct for Nishchay

2.6 Account Groups (OBD4)

The Account groups is a summary of accounts based on criteria that

effects how master records are created. The Account groups are
created to handle two things.
(a) The Number ranges
(b) Field Status of the G/L Master Record

Chrt/Accts Acct Group Name From Acct To Acct

NC01 C.A. Current 1000 1999
Assets
NC01 C.L. Current 2000 2999
Liabilities
NC01 D.E. Direct 3000 3999
Expenses
NC01 D.I Direct 4000 4999
Income
NC01 I.E Indirect 5000 5999
Expenses
NC01 I.I Indirect 6000 6999
Income
NC01 T.D. Taxes & 7000 7999
Duties

2.7 Vendor Master Record

Vendor Master Records contain the data that controls how business
transaction are recorded and processed by the system. Details such
as Address, Bank details, Payment related details, Correspondence,
TDS details and other accounting details are stored for each vendor.

Each vendor master record is assigned to a GL (Reconciliation)

account. Such GL account’s purpose will be to collect the
transactions posted into vendors that are linked to it.
 Similar classes of transactions related to vendors such as Advances,
can be mapped to different GL (special) accounts.

Vendor Account Master

Company Code Data Purchasing

General Data organization data

2.8 Vendor Tolerance Group (OBA3)

The tolerances are used for dealing with payment differences and
residual items that may arise when payment clearing is carried out.

Company Code NC01

Tolerance Group Tolerance limit for DR. CR.

2.9 VENDOR ACCOUNT GROUPS (OBD3)

Vendor Account Group is an object created to distinguish between

different types of vendors and to group vendors of similar nature
transaction wise.Vendor accounts groups carry the number ranges of
vendor master records.

Account 1000 2000 3000

Group
Name Domestic International Other Vendors
Vendor for Vendor for for NC01
NC01 NC01

2.10 Vendor No. Range (XKN1)

 No. From No. To No. Current No. EXT
NC 1 99999

2.11 VENDOR LIST (FK01)

SAP Path-
Go to Accounting -> Finance Accounting • Accounts Payable -> Master
Record -> Create

1. DOMESTIC VENDOR

Vendor No. VENDOR NAME

4001 BALA JI PVT. LTD.
4002 BAJAJ PVT. LTD.
4003 TVS PVT. LTD.
4004 TATA PVT. LTD.
4005 GOOD YEAR PVT. LTD.
4006 HYPERC
4007 MCLAREN PVT LTD.
4008 SUNOCO PVT LTD.
4009 XTRAC INC. PVT LTD.
4010 DALLARA PVT LTD.
4011 KIRKEY RACING YABVICOTE
4012 WOODARD MACHINE CORP.
4013 PWR NORTH AMERICA
4014 LONTUS PVT LTD.
4015 THERMAL CONTROL PRODUCT
4016 FEBL PVT LTD.
4017 AUTOZONE PVT LTD.
4018 MAYLE PVT LTD.
4019 VAICO PVT LTD.
4020 DURALAST PVT LTD.

2. INTERNATIONAL VENDOR

VENDOR NO. VENDOR NAME

4101 GKN PLC
4102 NTN CORPORATE
4103 TENNECO INC.
4104 IAC CORPORATE
4105 NSK GROUP OF COMPANY

3. 1-TIME VENDOR

VENDOR NO. VENDOR NAME

4201 BHART YORGE LTD
4202 BOSCH PVT LTD.
4203 SPARK MINDA CO.
4204 SAMVARDHANA MOTHERON GROUP
4205 AMTEK GROUP
4206 EXIDE GROUP
4207 FDEVAL MOGUL CORPORATION
4208 GABVIEL INDIA LTD.
4209 JBM GROUP
4210 JMT AUTO LIMITED
4211 PCL GROUP
4212 SONA GROUP
4213 SUPARJIT GROUP
4214 WABCO INDIA LIMITED
4215 LEONI AG
4216 NEMAK GROUP
4217 DUPONT GROUP
4218 HONEY WELL PVT. LTD.
4219 TI AUTOMOBILES
4220 KSPG AG
4221 VIMAL JITH
4222 MS AUTO PARK
4223 GURU CAR DECOV
4224 SAE AUTO AIRCON
 4225 NET COOL SERVICE CENTER
4226 WABCO INDIA LIMITED
4227 ENDURANCE LTD
4228 VARROCE LTD
4229 SUNDAGRAM CLAYTON LTD.
4230 VECV GROUP

5.4 Payment Method

The payment method determines how payments are to be made, e.g.
by cheque, bank transfer or bill of exchange. Payment methods are
entered in the master records of vendors in order to specify how
payments are made.

5.5 Terms of Payment (obb8)

The Terms of payment key can determine the following:
 The valid cash discount rate for an individual payment and
baseline date for the payment,or
 The terms of payment for installment payments.

Terms of payment can be attached to the vendor master record. (T-

code: OBB8)
Pmnt. Terms Pmnt. Terms for nc01

Term Percentage No. of Days

1 15 5
2 5 15

ACCOUNT RECEIVABLE:
SAP FI Accounts Receivable component records and manages accounting data of all
customers. It is also an integral part of sales management. It is used to manage and record
Accounting data for all the customers. It handles customer invoices, approvals,
payments and other allied activities.

Any postings made in Accounts Receivable is updated in General Ledger G/L as

well. The Accounts Receivable submodule has tons of reports and forecasting
features to track customer/vendor outstanding and payments.

CUSTOMER ACCOUNT GROUP ( OBD2 )

Account group is the highest level of customer master data. Customers are classified into
various account groups. Account Group functionalities - Controls the field of customer
master. Classifies customers to use for various functions.

Account 4000 5000 6000

Group
Name Domestic International Other
Customer for Customer for Customer for
NC01 NC01 NC01

Customer No. Range (XDN1)

No. From No. To No. Current No. EXT

NC 1 99999

CUSTOMER LIST

DOMESTIC CUSTOMER
 Customer No. Customer Name
5001 MAHINDRA PVT. LTD.
5002 HERO MOTO CORPS. LTD.
5003 PRICE WATER CORPS. LTD.
5004 BERKSHIRE HATHWAY LTD.
5005 E & Y LTD.

CUSTOMER INVOICE ( FB70 )

The invoice contains information such as customer details, amount to be paid,

payment terms, shipping address, and so on. A customer invoice can be created
in SAP S/4HANA Finance directly in accounts receivable or in sales and
distribution using the order-to-cash business process.

INCOMING PAYMENT ( F-28 )

Incoming payments are received in from your customers as payment for

supplies or services rendered. Outgoing payments are to send out to vendors for
supplies or services that were provided to you, or other payments.

HOUSE BANK (FI12)

House bank of a company code is represented by a bank id through which you can
process  payment transactions. It is used for the purpose of payment program,
check deposit, automatic payment program (APP), and bank reconciliation
 A house bank in SAP is identified by a 5 character alphanumeric code.
Each house bank ID is unique within a company code and a company
code can have multiple house banks.
 Each house bank in SAP system is associated with a country key
representing the country where the bank is located.
 House banks can have more than one bank account id, account ID is
unique for a specific bank ID and company code. The account ID is
used for entering specifications for the payment program and for
updating the G/L Account Master records

1. HOUSE BANK
 Company Code NC01
House Bank BOB
Bank Country IN
Bank Key BOB12345

2. BANK ACCOUNTS

Account ID NC01
Description House Bank For NC01
Bank A/c No. 8945237910
Currency INR

Define No. Ranges For Check

CHECK LOTS

Lot No. Short Info Check No. Check No. To

From
1 First Cheque 00001 10000
Book

AUTOMATIC PAYMENT (F110)

Automatic Payment Program (APP) serves the purpose of posting accounts
payable like payment to a vendor based on vendor invoices automatically.
APP is used to find out due/overdue invoices and to process a list of customer
and vendor invoices to make payments in one go. APP cannot be used for all
company codes from different countries.

APP have following steps to maintain (FBZP) -

 All Company Codes
  Paying Company Codes
 Pmnt Methods In Country
 Payment Methods In Company Codes
 Bank Determination
 House Bank

5.6 CASH JOURNAL (FBCJC0)

The cash journal is a subledger of Bank Accounting. It is used to manage a
company's cash transactions. The system automatically calculates and displays
the opening and closing balances, and the receipts and payments totals. You can
run several cash journals for each company code. You can also carry out
postings to G/L accounts, as well as vendor and customer accounts.

COCD CJ No. G/L Acct. Currency Cash Jour. Name

NC01 NC01 1004 INR Petty Cash For NC01

DUNNING:
1. Define Dunning Procedure (FBMP)
2. Dunning (F150)

Dunning is the process of sending dunning notices to customers with

overdue payment items, requesting payment of the outstanding amount by
a specified date. To help you track open invoices and monitor the payment
behaviour of your customers, SAP Business One includes the dunning wizard.
It is the process of Correspondence with the Customer/Vendor about
pending bills (in sap as we call it open items)

Dunning Level Days in Arrear Dunning Charges

1 1 100
2 8 120
3 15 140
4 22 160
GOODS AND SERVICE TAX (GST)
Goods and Services Tax (GST) is an indirect tax charged on the supply of
goods and services, right from the manufacturer or service provider to the
consumer. Credits of input taxes paid at each stage is available in the
subsequent stage of value addition. Thus, the final consumer will only bear the
tax charged by the last dealer in the supply chain, with set-off benefits at all
previous stages.

1. Condition Type (OBYZ)

NCCI CGST INPUT
NCSI SGST INPUT
NCII IGST INPUT
NCCO CGST OUTPUT
NCSO SGST OUTPUT
NCIO IGST OUTPUT

2. Check and change settings for tax processing (OBCN)

Process Description Tax Type Posting Indic
NCI CGST INPUT 2 2
NSI SGST INPUT 2 2
NII IGST INPUT 2 2
NCO CGST OUTPUT 1 2
NSO SGST OUTPUT 1 2
NIO IGST OUTPUT 1 2

3. Tax codes for sales/purchases (FTXP)

Tax Code Description Tax Type
N1 (CGST+SGST) Input Input Tax (V)
N2 IGST Input Input Tax (V)
N3 (CGST+SGST) Output Output Tax (A)
N4 IGST Output Output Tax (A)

4. Tax Percentage Rate (%)

Tax Type Acct Key Tax Percent Rate Cond. Type
CGST INPUT NCI 9 NCCI
SGST INPUT NSI 9 NCSI
IGST INPUT NII 18 NCII
CGST OUTPUT NCO 9 NCCO
SGST OUTPUT NSO 9 NCSO
IGST OUTPUT NIO 18 NCIO

5. Define Tax Accounts (OB40)

Tax Code Account
N1 7000
N1 7001
N2 7002
N3 7003
N3 7004
N4 7005
 ASSET ACCOUNTING
PATH:
SAP Customizing IMG >> Financial Accounting (New) >> Asset
Accounting
Asset Accounting in SAP FICO can manage all your fixed assets,
irrespective of your industry and country. In addition, SAP has
designed Asset accounting to manage the entire lifecycle of fixed
assets. It starts with purchasing to retirement or scrapping. Thus,
using this we can calculate the depreciation of assets, automatically
and manually,. Many also called it Fixed Asset Accounting in SAP.
Further, Asset Accounting in SAP FICO provides real-time
integration with FI for simultaneous recording of asset transactions.
This includes initial and subsequent acquisition, retirement, transfer
and scrapping.

Asset Class

Asset class means group of similar assets. Fixed Assets like Plants,
Machines, Land, Buildings, Furniture, Vehicles etc are categorized
into asset classes in SAP. The account determination, screen layout
rule and number range configurations are required to define asset
class in the SAP system. Every asset must be assigned to an asset
class. It is on the basis of asset class the system defines screen layout
rules to be followed for particular asset and what number range will
be provided to the asset. Asset class linked to account determination
specifies to which general ledger account values to be posted or
transferred. It means you have asset classes for Land, Building, Plants
etc. When we create an asset class for an asset the properties of the
asset class are derived by that asset.

For example- suppose we create one asset class for Land asset class
category then all the properties of that asset class are derived to the
same asset Land. One asset belongs to one asset class only but in one
asset class, you have different assets.

For example- in the Machines asset class, you can create so many
different types of Machines asset master records. Asset classes are
created at the client level. It means all the company code in the
client can use the same asset class.

ASSET MASTER RECORD

Using the asset master record, you can create, edit, and manage the
master data needed for Asset Accounting (FI-AA).
To make it easier for you to create, manage and evaluate master data,
the data is structured according to its use and function in the system.
The asset master record consists of two data areas:

General Master Data

This part of the master record contains concrete information about the fixed
asset. There are the following field groups:

 General information (description, quantity, and so on)

 Account assignment information
 Posting information (for example, activation date)
 Time-dependent assignments (such as, cost center)
  Information for plant maintenance
 Entries for net worth valuation
 Information on real estate
 Leasing conditions
 Investment support measures
 Information on the origin of the asset
 Physical inventory data
 Insurance data
 User fields/evaluation groups

Data for Calculating Asset Values

You can specify depreciation terms in the asset master record for each
depreciation area in the chart of depreciation. To enable you to make these
specifications, the master record contains an overview of the depreciation areas.
In addition, there is a detailed display available for each depreciation area. If
there are depreciation areas proposed from the asset class that are not needed
for a specific asset, you can deactivate these depreciation areas at the asset
level.

ASSET CLASS STRUCTURE

Header Section Master Data Section Valuation

Section

 Header Section – Control Parameters for Master data maintenance and

account determination
 Master Data Section – With default values for the administrative data in
the asset master record.
 Valuation Section – Control Parameters for valuation and default
depreciation terms for each depreciation area.

AS11 - Create Asset Sub-Number

Functionality
The term "asset" is used for simple assets, as well as for complex large-scale
assets that consist of a number of component assets. The data structure of the
system, with a 12 character alpha-numeric main asset number and a 4 character
sub-number, allows both. The main asset number represents the asset as a
whole. Parts of assets can be represented by different sub-numbers.

Features

Every master record is automatically created with at least one sub-number, even
if no sub-assets exist. The system marks the first master record as an asset main
number master record. When you use internal sub-number assignment, this
main number has sub-number "0000". You can create additional sub-numbers
for this main number master record. The system manages values for each sub-
number for every individual depreciation area in year segments. The individual
transactions are posted directly to the sub-numbers as line items.

1. Chart Of Dep. / Depreciation Areas

T CODE: EC08

IMG PATH:

SPRO >> SAP Reference IMG >> Financial Accounting >> Asset Accounting
>> Organization Structures >> Copy reference chart of depreciation /
depreciation areas.
Charts of depreciation are used in order to manage various legal requirements
for the depreciation and valuation of assets. These charts of depreciation are
usually country-specific and are defined independently of the other
organizational units. A chart of depreciation, for example, can be used for all
the company codes in a given country (refer to Company Code Assignment ).

Chart of Dep. Chart of depreciation for NC01

Dep. Area Book Depreciation
Value Maintenance
Acquisition Value
Net Book Value All Values Allowed

Investment Grants
Revaluation
Ord. Dep.
Special Dep.
Unplanned Dep.
Transfer Of Reserves
Interest
Revaluation Ord. Dep.
2. Assign G/L Accounts
Chart Of Dep. NC01
Dep. Area 1 (Book Dep.)

Acquisition, Retirement & Dep. Account Assignment

Acquisition: Acquis. Prod. cost
Loss On Asset Retirement
Clearing Acct. From Asset Sale
G/L Acct. No.
Gain From Asset Sale
Loss From Asset Sale
Acc. Dep. Acct.
3. Maintain Dep.
Dep. Acct. Key
 The depreciation key contains the value settings which are necessary for
determining depreciation amounts. It represents a combination of calculation
rules, which are used for the automatically calculated depreciation types

Ordinary depreciation - Ordinary depreciation is the planned deduction for wear

and tear during normal use of an asset.

Special depreciation - Special depreciation represents deduction for wear and

tear on an asset from a purely tax-based point of view. This form of
depreciation allows percentage depreciation, possibly staggered within a period
allowed by the tax authority, without taking into account the actual wear and
tear on the asset.

Unplanned Depreciation - Ordinary depreciation reflects the deduction for wear

and tear during the normal use of the asset. Unusual influences, such as damage
which leads to a permanent decrease in the value of the asset, are covered by
unplanned depreciation.

Features
You assign calculation methods to each depreciation key for the actual
determination of depreciation amounts.

You can define depreciation keys and calculation methods in Customizing for
Asset Accounting ( Depreciation → Valuation Methods → Depreciation
Keys ).
Chart Of Dep. NC01
Dep. Key NC01
Dep. Type Ord. Dep.
Phase From The Start Of Dep.
Base Method NC01
Decl. Balance Method NC0
Prd Cont IN1
Multi-Level Method NC0
Class No Assignment
Chnge. Method No Automatic Changeover
Controlling

Controlling as the name suggests is used for internal reporting. FI module is

used for legal reporting so in FI you do not have much chance to modify the
standard. It has to be more in par with the legal requirement of the country and
accounting standards. In the other hand CO module does not bind itself in any
kind of legal requirements hence you can modify the reports and use it for your
own reporting purpose. For example - in FI you cannot report on the basis of
profitability of a customer or a region alone but in CO you can do this. The
other most important factor is planning and budgeting in CO which is again not
possible in FI. In real time CO is used for reporting purpose. The end
destination of all FI and CO postings is CO-PA. In CO-PA you can pull out
reports as per your requirement (as I mentioned for a customer, region, product
or anything you like).

This is the most basic reason why CO is used in the system.

SAP Controlling (CO) is another important SAP module offered to an

organization. It supports coordination, monitoring, and optimization of all the
processes in an organization. SAP CO involves recording both the
consumption of production factors and the services provided by an
organization.
SAP CO includes managing and configuring master data that covers cost and
profit centers, internal orders, and other cost elements and functional areas.
The main purpose of SAP controlling module is planning. It enables you to
determine variances by comparing actual data with plan data and thus enables
you to control business flows in your organization.

SAP CO Integration with Financial Accounting

Both SAP CO and SAP FI modules are independent components in a SAP
system. The data flow between these components takes place on a regular
basis.
Data flows relevant to cost flows to Controlling from Financial Accounting. At
the same time, the system assigns the costs and revenues to different CO
account assignment objects, such as cost centers, business processes, projects
or orders.
Profit Center Standard Hierarchy:
PATH:

Accounting → Controlling → Profit Center AccounƟng → Master Data →

Standard Hierarchy → Create.

SAP CO Profit Center standard hierarchy, known as tree structure, that

contains all the profit centers in a controlling area.

If you want to create/change the structure of a standard hierarchy, it can be

done at two places −

 In the Profit Center Accounting

 In Customizing for Profit Center Accounting

Profit Centre
PATH:

SPRO → SAP Reference IMG → Financial AccounƟng → General Ledger

Accounting → Business Transactions → Closing → Document → Define
Financial Statement Versions → Execute

SAP CO Profit Center is used for managing internal controlling. When you
divide your company into profit centers, it allows you to delegate
responsibility to decentralized units and treat them as separate companies in a
company. It also allows you to calculate key figures in cost accounting like
ROI, Cash flow, etc.
Profit Center is a part of Enterprise Controlling module and is integrated with a
new General Ledger Accounting.
Key Features of SAP CO Profit Center
Profit Center Accounting is used to determine profit for internal areas of
responsibility. It lets you determine profits and losses using either period
accounting or the cost-of-sales approach.
It allows you to analyze fixed assets by profit center, thus using them as
investment centers. It allows to expand profit centers to investment centers.

Why Do We Create Profit Center?

The main aim of creating a Profit Center in SAP CO is to analyze the cost of a
product line or a business unit.
You can also generate P&L accounts according to a Profit Center and also
generate balance sheets, however a Profit Center should only be used for
internal reporting purpose.
The key components of a profit center include – name of the profit center, the
controlling area under which it is assigned, time period, person responsible for
the profit center, standard hierarchy, etc.

Profit Centre PC_NISH

Name NISH_PC
Long Text NISH profit centre
Department Production
Profit Ctr. Group CASTD_NISH

COST CENTER

A Cost Center is defined as a component in an organization that adds to the

cost and indirectly adds to the profit of the organization. Examples include
Marketing and Customer Service.
A company can classify a business unit in three ways −
  Profit center,
 Cost center, or
 Investment center.
The simple and straightforward division in an organization can be classified as
cost center because cost is easy to measure.

Cost Center Hierarchy

The hierarchy of a cost center looks as follows −

Create Cost Center:

To create a cost center, use the T-code KS01
Cost center CC CC _Production

Valid from
Valid to 31.03.2022

.Enter
NAME Production_CC

Description Production Cost center

User responsible SAP user

Person responsible
Department Production
Cost center catg. 1

Hierarchy area CCSTD_NC01

SAP FICO – INTEGRATION

SAP FI is commonly integrated with MM and SD component. SAP FI

Integration with other modules means how the system maps with different
modules and how the effect of those is passed into FI Module.
FI integration with SD and MM
For SAP FI-MM, use the T-code OBYC
Example
In case of standard sales order, you create an outbound goods delivery to the
customer. Here movement 601 takes place. This movement is configured in
MM and movement of goods hit some G/L account in FI.
Every such movement of goods hits General Ledger account in FI.
The accounts posting in FI is done with reference to the billing documents like
credit and debit note, invoice etc. created in SD and hence this is link between
SD and FI.
Tax determination: In case of a tax determination, there is a direct link between
SD and MM.

Movement Types
Material movements in MM is done with respect to a Movement Type.

 Goods receipt – movement type 101

 Goods issue to production order – movement type 261
 Scrapping of goods – movement type 551
 Goods delivered to the customer – movement type 601
  Initial upload of stock – movement type 561
SAP allows us to use different G/L accounts for the various movements for the
same material by linking this movement type to a transaction key and hence
we can set G/L accounts as per movement type.

SAP FI - Financial Statement Version

General Ledger accounts can be used as per legal regulations to generate the
final statements. Financial statement versions are used to create the financial
statements, to run account balance reports and for General Ledger accounting
planning.
You can also define multiple financial statement versions to generate financial
statements in different formats. Follow the steps given below to create
financial statement versions −
PATH:
SPRO → SAP Reference IMG → Financial Accounting → General Ledger
Accounting → Business Transactions → Closing → Document → Define
Financial Statement Versions → Execute.

Provide the following details −

 Enter the Fin. Stmt. Version.
 Enter the Description of the financial statement version.
 Maint. Language − Enter the language key in which you display texts,
enter texts, and print statement.
 Item Keys auto − It tells keys of financial statement items are assigned
manually or automatically when the financial statement versions are
defined.
 Charts of Accounts − All accounts from this chart of accounts COA can
be assigned when you define the financial statement. If you do not
specify a chart of accounts, accounts from several charts of accounts can
be assigned when you define the financial statement.
 Group Account Number − Enter this Indicator that specifies that the
group account numbers should be assigned instead of the account
numbers when you define the financial statement version.
 Fun. Area Parameter − This indicator is used to make it possible to
assign functional areas or accounts in the financial statement version.
Once the above fields are defined, you can click on the save
configuration and to generate change request number. To edit this
Financial Statement version, click on Fin. Statement items → you can
maintain nodes in version.
Summary
 SAP FICO introduction: SAP FICO module is a module of SAP
ERP which is used for financial reporting both externally and
internally.

 SAP FICO meaning: SAP Financial Accounting (FI) and

Controlling (CO)

 All general ledger accounts that are used for reporting are
managed through general ledger accounting. In SAP a set of all
general ledger accounts used by a company or a group of
companies is called a chart of accounts.

 Accounts receivables is a sub module that captures all

transactions with customers and manages customer accounts.

 Accounts payables is a sub module that captures all transactions

with vendors and manages vendor accounts.

 Asset accounting manages all transactions related to assets for

an entity.

 Bank accounting captures all transactions with the banks.