FICO Interview Questions
1. What is SAP R/1, R/2, R/3? Or Difference between R/1, R/2, R/3?
SAP R/1
SAP R/1 was the first version and it is one tier architecture in which three layers Presentation, Application and Database are installed in one system/serve Server one – Presentation + Application + Database
SAP R/2
SAP R/2 is the mainframe version of software and it is 2 tier architecture in which three layers Presentation, Application and Database are installed in two separate server.
(Server one – Presentation, Server two – Application + Database
SAP R/3
SAP R/3 is the client/server version of the software and it is 3 tier architecture in which three layers Presentation, Application and data base are installed in three server/syste Server one – Presentation, Server Two – Application, server Three – Database
2. What is Financial Accounting SAP?
Financial Accounting module is the back bone of SAP, which records, collects, and process financial transactions on a real time basis and which the data is drawn for the external and internal reporting. Financial Accounting is integrated with other modules such as
• Sales & Distribution ( SD )
• Material Management ( MM )
• Human Resources ( HR )
• Production Planning ( PP )
• Controlling (CO) etc.
3. What are Organizational Units in SAP?
Ans. Organizational units in SAP are the functional units in enterprise and are used in reporting.
For Example:-
1. Client ( Across the Various Modules )
2. Company Code ( FI )
3. Controlling area ( CO )
4. Plant ( Logistics )
5. Purchasing Organization ( PO)
6. Sales Organization ( SD )
7. Employee Group (HR), etc.
4. Explain the organizational assignment in the PA module?
The operating Concern is the highest node in Profitability Analysis.The operating concern is assigned to the Controlling Area.Within the operating concern all the transactions of Profitability Analysis are stored.The operating concern is nothing but a nomenclature for defining the highest node in PA.
5. What is a Company in SAP?
Ans. Company is the organizational unit for which individual financial statements can be drawn according to the relevant commercial law. A company can comprise of one or more company codes. A Company has local currencies in which its transactions are recorded. All company codes within a company must use the same transaction Chart of accounts and the same Fiscal Year. Creation of company in sap is optional.
6. What is a Company Code in SAP?
Ans. Company Code in SAP is the smallest organizational unit of Financial
Accounting for which you draw individual financial statements like Balance Sheet and Profit & Loss Account for purpose of external reporting. The Creation of company code in sap is mandatory.
7. What are the Organizational Elements in SAP FI and describe them?
Ans. The Important organizational elements in SAP FI are
• Company Code
• Business Area
• Chart of Account
• Functional Area
8. What are the other important activities in Profit Center?
The assignments of profit center to the cost center and also assignment of profit center to the material master is what will determine the success of the Profit center posting. If these assignments are wrongly done then the profit center postings will not come in properly.
9. What is a Business Area?
Ans. Business area is a separate area of operations or responsibilities of
organizational units with in a company code and used for internal and external
reporting. Different divisions of each business with in a legal entity are created as Business areas for reporting of each operational areas.
10. What is IBAN Number in SAP?
Ans. IBAN stands for “International bank account number, internationally recognized, unique identification number for a specific bank account.
An IBAN is a series of a maximum of 34 alphanumeric characters, and is made up of a combination of the following elements:
1. The bank country key (ISO-Code)
2. Two check digits
3. Country-specific account number
IBAN maintains in bank details of Customer/Vendor Master data and in House bank,most of the time IBAN is used for foreign currency payments time.
11. Can you assign more than One Company Code to a Company?
Ans. Yes. We can assign more than One ‘Company Code’ to a ‘Company’
All the Company Codes within a Company should use the same Chart of Accounts and the same Fiscal Year, though all company codes can have different Local Currencies.
12. What is a Posting Key and What does it control in SAP?
Ans. Posting key in SAP is a two digits numerical key that determines the type of transaction entered in line items
Posting Keys determines:-
1. Account Types ( A, D, K, M, S )
2. Type of postings i.e. Debit or Credit
3. Field status of transaction
13. What are the Sub modules in SAP Financial Accounting (FI)?
Ans. SAP FI Modules contains the following sub-modules
• General Ledger accounting
• Accounts Receivables
• Accounts Payable
• Asset Accounting
• Bank Accounting
• Consolidation
• Special Purpose Ledger
• Travel Management
14. What is a Functional Area in SAP?
Ans. Functional Area is a organizational unit in accounting that classifies the expenses of an organization by functions. The functional area is use to create P&L A/C in Financial Accounting using cost of sales accounting. E.g. of functional areas are
• Administration
• sales and distribution
• Manufacture
• Production
• Research and development.
15. What is a Credit Control Area in SAP?
The credit control area is an organizational unit that specifies and checks a credit limit for customers. Credit control area can includes one or more company codes
16. What is a Chart of Accounts and types of COA in SAP?
Ans. The chart of accounts in SAP (COA) is a list of GL accounts master record that are used by the organization. A chart of accounts must be assigned to each company code. Chart of Accounts is defined at client level.
Types of Chart of Accounts:-
• Operating chart of Accounts
• Country Specific chart of Accounts
• Group Chart of Accounts.
17. What is the purpose of defining Internal orders.?
Internal Orders are basically used for tracking of costs, which are proposed to be incurred over on a short term basis and time tracking is not of much essence.Eg an Advertisement campaign. Sales Promotion and Exhibition expenses etc.
18. What is a Country Chart of Accounts?
The country-specific chart of accounts in sap contains the G/L accounts needed to meet the country’s legal requirements. Country specific chart of accounts are assigned to company codes and this is optional.
19. What is an Operating Chart of Accounts in SAP?
The operating chart of accounts in sap contains the G/L accounts that uses for posting in company code for daily activities and used in both financial accounting and cost accounting. You have to assign operating chart of accounts to a company code.
20. What is Group chart of Accounts and its purpose?
The Group chart of accounts in sap contains the G/L accounts that are used by the entire corporate group and this COA is used to consolidate the reports for the entire corporate group.
21. Which COA is used for day to day postings?
- Operating chart of accounts
22. How many charts of accounts can be assigning to one company code?
One chart of accounts can be assigned to several company codes, and you will not be able to assign more than one chart of accounts to a single company code.
23. What is a Fiscal Year?
A fiscal year is divided in to number of posting periods and each posting period in a accounting period is defined by a start date and end date
24. What is a Fiscal Year Variant?
Fiscal year variant is used to define the fiscal year.
A Fiscal year variant contains the 12 normal posting periods and 4 special periods. We can define maximum 16 posting periods for each year. Special periods are used for Year-end activities.
25. Which transaction code is used to assign a fiscal year to a company code?
Transaction Code- OB37
26. What is a Posting period variant?
Posting Period Variant is accountable for the opening and closing of periods in a Fiscal Year for postings to take place. The Posting Period Variants (PPV) in SAP is used to control which accounting period is open for postings and ensuring that closed period remain balanced and reconciled. We can assign posting period variants to one or more company codes.
27. What is Opening and Closing Posting Periods?
The posting periods can be maintained as per account type and the year which is to be open & which is to closed. The Posting Period Variant is used to control which accounting period is to be open for posting and ensuring that closed periods are remain balanced and reconciled.
28. What is a year dependent and independent fiscal year variant?
Fiscal year in SAP can be defined as year dependent or Year Independent
Year independent – Same number and dates for the periods every year
year dependent – Periods can be different from year to year
29. How many Chart of Accounts can a Company code have?
A single Company code can have only one Chart of Account assigned to it. The Chart of Accounts is nothing but the list of General Ledger Accounts.
30. What is a Shortened Fiscal Year?
Fiscal year which has less than 12 posting periods is known as shortened fiscal year.
31. Can you explain how do you carry forward Account Balances?
Account balances are carried forwarded from one fiscal year to the next fiscal year by using the SAP standard carry forward program.
32. What is a Retained Earning account? And how many retained earning
accounts can be defined in SAP System?
Account balances are carried forwarded from one fiscal year to the next fiscal year by using the SAP standard carry forward program. Retained earnings account is assigned to each P&L account by specifying a P&L statement account type in the chart of accounts (COA).Each Profit & Loss account is assigned to a Retained Earnings Accounts by key
33. What is a Field Status group?
The field status group specifies which fields are ready for input, which are required entry fields, and which are hidden when entering documents.
34. What is chart of account? What is the relevance of defining chart of account?
A. It is the top level financial structure, contains the GL Accounts we define the all the accounts and one chart of accounts assign to company code and one chart of accounts will assign to many company codes . It is list of Gl accounts and it contains account no , account name, language, length, cost element, blocking information that controls the how an account functions and how a gl account created in company code . COA Key.
35. What is account group? What does it control?
A. IT determines the which fields you need to configure on the GL master record. It is necessary to have at least 2, one for B/S and another one for P&L accounts. It controls the number ranges of GL. The Status fields of the master record of GL Belong to company code area.
36.. What is posting key? What is its role?
A. It controls the line item of GL entry debit and credit.
37. What is business area?
A. Organizational unit of external accounting that corresponds to a specific business segment or area of responsibility in a company. Financial statements can be created for business areas for internal purposes. They are primarily used to facilitate external segment reporting across company codes covering the main operation of a company (product line, Branches). The Business area may be the branch of the company or product lines it deals with
38. While defining chart of account, there is field "manual creaation of cost element" and "automatic creation of cost element", what is it?
A. Generally when ever we are creating cost elements we can create some of exependitures manually some automatically so we can create manually cost elements in defining chart of accounts.
39. After creating a customer/vendor, how can we check that under which account group we have configured this customer/vendor?
A. We can check through customer group and vendor group it was created by ours when we are creating vendor and customer groups.
40. How the system will know that april is your first posting period?
A. Yes the system will find out april was first posting period. While configuring fiscal year we giving april to 1 may to 2, june to 3, like this system will identify april was the first posting period.
41. Define the term "fiscal year" , "posting period varient" & " field status varient".
A. FSGV controls the additional account assignments and other fields that can be posted at the line item level for GL a/c. FSGV can be control at three level i.e.,
1) In OBC4 (ch of a/c’s) - which controls the screen for a particular GL a/c group,
2) Posting Keys - which controls the screen for a particular posting key transaction is taken, &
3) Accounting Groups - which controls the screen for a particular account group i.e., customer group or vendor group.
A. Posting period variant which controls posting periods, both normal and special periods are open for each company code. The posting period is independent of fiscal year variant.
A. Fiscal year is controls the which type year we are following like calendar year, year dependent year.
42. How can you use the additional log in the AP payment program for troubleshooting?
Any errors in a payments run, regardless of the reason, are reported in the additional log, allowing corrections to be made rapidly, reducing error rates.
43. How do you handle cash transactions or single purchase vendors?
Not every vendor needs a new master record. When you only purchase from them once, or when paying cash, a dummy code can be used on the invoice entry, and information traditionally stored in a master record is recorded on the individual invoice.
44. How is debt collection or dunning handled using SAP?
SAP allows for different levels of debt collection notices. Depending on the age of the overdue payment, collection letters can range from reminder notices to legal notifications.
45. How can you maximize productivity when sending out correspondence?
SAP allows you to generate correspondence requests as you work, creating invoices, statements and more, for later printing. This allows you to do all printing as a single batch at the end of the work day.
46. What Fiscal year options are available using SAP?
A fiscal year is nothing more than a designated way to store financial data. In SAP, you have twelve periods and four special periods, allowing for both monthly and quarterly data organization. There are two types of fiscal years that are available: Calender year and Year dependent fiscal year.
47. What types of GL accounts should be posted automatically?
Stock and consumption accounts are the most common, and creating the automatic posting option is fairly simple. In the GL account master record, check the box next to “Post Automatically Only.”
48. What is the organizational assignment in the controlling module?
Every company has a unique company code assigned. The controlling module allows you to create a controlling area which contains all activities related to cost center accounting, product costing and profitability analysis.
49. Describe the relationship between cost center accounting and profit center.
Cost centers allow companies to capture all costs related to daily businesses operations, generally excluding unavoidable monthly expenses like rent or utilities. Administrative, entertainment, food and other expenses fall under this heading. Profit centers capture data related to both cost and revenue, showing how much each dollar of profit costs to generate.
50. What are one-time vendors ?
A. In certain industries (especially where there are a high volume of cash transactions), it is not practical to createnew master records for every vendor trading partner.One-time vendors allow for a dummy vendor code to beused on invoice entry and the information which isnormally stored in the vendor master (payment terms,address etc) , is keyed on the invoice itself
51. Explain briefly how you can import electronic bank statements into SAP.
A text file is received from the bank which is thenuploaded into the SAP system. The file contains details of the company’s bank movements e.g. cheques, bank interest, bank charges, cash receipts etc. Depending on thesystem configuration SAP will attempt to book thesetransactions automatically to the correct accounts to avoidthe need for manual entries by SAP users. Any postings which the system cannot derive automatically can be booked through “post-processing”
52. Explain the purpose of the account type field in the GLmaster record
A:At year end P&L accounts are cleared down to theretained earnings balance sheet account. This fieldcontains an indicator which is linked (in the IMGtransaction OB53) to the specific GL account use in thisclear down
53.What is a sort key and what is it used for?
A:Sort keys are stored in customer, vendor and GLmaster records. They determine what value is populated inthe ‘assignment’ field in the document line items posted.There are several standard entries in a pre-delivered SAPsystem and additional entries can be configured if required. A very common use for sort key 014 Purchase Ordernumber for example, is to allow the GR/IR clearing GLaccount to be cleared automatically.For FI/CO jobs in a logistics environment this is a commonquestion
54. . Where to assign activity type in cost centers? OR how to link cost centers & activity types?
>> There is no direct assignment. You plan the output for a cost center first in kp26. Then you’ve to plan the value of that cost center which you budget for a period in kp06. Planned Activity expenditure / Planned Actvty qty gives yoa planned act rate which you can use to valuate your activity confirmations in mfg ordrs. You can also define your own prices,but you have to run the price revaluation if you want to revaluate your actual activity prices.
55. For stat. key figure what is the significance of sender & receiver cost elements & cost centers?
>> Stat key fig are not real account assignments. In simple traditionl terms it is the base to allocate or define praportions with which the cost is allocated. SKFs are used to calculate the debit on a receiver object. These values can be used for assessing common costs which are used by all the other cost centers.
56. What is chart of account? What is the relevance of defining chart of account?
A. It is the top level financial structure, contains the GL Accounts we define the all the accounts and one chart of accounts assign to company code and one chart of accounts will assign to many company codes . It is list of Gl accounts and it contains account no , account name, language, length, cost element, blocking information that controls the how an account functions and how a gl account created in company code . COA Key.
57. What is account group? What does it control?
A. IT determines the which fields you need to configure on the GL master record. It is necessary to have at least 2, one for B/S and another one for P&L accounts. It controls the number ranges of GL. The Status fields of the master record of GL Belong to company code area.
58. What is posting key? What is its role?
A. It controls the line item of GL entry debit and credit.
59. What is business area?
A. Organizational unit of external accounting that corresponds to a specific business segment or area of responsibility in a company. Financial statements can be created for business areas for internal purposes. They are primarily used to facilitate external segment reporting across company codes covering the main operation of a company (product line, Branches). The Business area may be the branch of the company or product lines it deals with
60. While defining chart of account, there is field “manual creaation of cost element” and “automatic creation of cost element”, what is it?
A. Generally when ever we are creating cost elements we can create some of exependitures manually some automatically so we can create manually cost elements in defining chart of accounts.
61. After creating a customer/vendor, how can we check that under which account group we have configured this customer/vendor?
A. We can check through customer group and vendor group it was created by ours when we are creating vendor and customer groups.
62. How the system will know that april is your first posting period?
A. Yes the system will find out april was first posting period. While configuring fiscal year we giving april to 1 may to 2, june to 3, like this system will identify april was the first posting period.
63. Define the term “fiscal year” , “posting period varient” & ” field status varient”.
A. FSGV controls the additional account assignments and other fields that can be posted at the line item level for GL a/c. FSGV can be control at three level i.e.,
1) In OBC4 (ch of a/c’s) – which controls the screen for a particular GL a/c group,
2) Posting Keys – which controls the screen for a particular posting key transaction is taken, &
3) Accounting Groups – which controls the screen for a particular account group i.e., customer group or vendor group.
A. Posting period variant which controls posting periods, both normal and special periods are open for each company code. The posting period is independent of fiscal year variant.
A. Fiscal year is controls the which type year we are following like calendar year, year dependent year.
64. How is cost center accounting related to profit center?
In the master data of the Cost Center there is a provision to enter the profit center. This way all costs which flow to the cost center are also captured in the profit center.Cost centers are basically created to capture costs eg admin cost center ,canteen cost center etc Profit centers are created to capture cost and revenue for a particular plant, business unit or product line.
65. What is a cost element group?
Cost element group is nothing but a group of cost elements which help one to track and control cost more effectively. You can make as many number of cost element groups as you feel necessary by combining various logical cost elements.
66.What is a cost center group?
In a similar line the cost center group is also a group of cost centers which help one to track and control the cost of a department more effectively. You can make as many number of cost centers as you feel necessary by combining various logical cost centers Infact you can use various combinations of cost center group with the cost element group to track and control your costs per department or across departments
67. What is the difference between Distribution and Assessment?
Distribution uses the original cost element for allocating cost to the sender cost center. Thus on receiving cost center we can see the original cost element from the sender cost center. Distribution only allocates primary cost.
Assessment uses assessment cost element No 43 defined above to allocate cost. Thus various costs are summarized under a single assessment cost element. In receiver cost center the original cost breakup from sender is not available. Assessment allocates both primary as well as secondary cost.
68.What are the other activities in Cost center?
If you have a manufacturing set up entering of Activity prices per cost center/activity type is an important exercise undertaken in Cost center accounting.
69. How does SAP go about costing a Product having multiple Bill of materials within it?
SAP first cost the lowest level product, arrives at the cost and then goes and cost the next highest level and finally arrives at the cost of the final product.
70. What do you mean by primary cost component split ?
Primary cost split is defined when you create a cost component structure.When you switch on this setting, the primary cost from the cost center are picked up and assigned to the various cost components.
1. What is SAP R/1, R/2, R/3? Or Difference between R/1, R/2, R/3?
SAP R/1
SAP R/1 was the first version and it is one tier architecture in which three layers Presentation, Application and Database are installed in one system/serve Server one – Presentation + Application + Database
SAP R/2
SAP R/2 is the mainframe version of software and it is 2 tier architecture in which three layers Presentation, Application and Database are installed in two separate server.
(Server one – Presentation, Server two – Application + Database
SAP R/3
SAP R/3 is the client/server version of the software and it is 3 tier architecture in which three layers Presentation, Application and data base are installed in three server/syste Server one – Presentation, Server Two – Application, server Three – Database
2. What is Financial Accounting SAP?
Financial Accounting module is the back bone of SAP, which records, collects, and process financial transactions on a real time basis and which the data is drawn for the external and internal reporting. Financial Accounting is integrated with other modules such as
• Sales & Distribution ( SD )
• Material Management ( MM )
• Human Resources ( HR )
• Production Planning ( PP )
• Controlling (CO) etc.
3. What are Organizational Units in SAP?
Ans. Organizational units in SAP are the functional units in enterprise and are used in reporting.
For Example:-
1. Client ( Across the Various Modules )
2. Company Code ( FI )
3. Controlling area ( CO )
4. Plant ( Logistics )
5. Purchasing Organization ( PO)
6. Sales Organization ( SD )
7. Employee Group (HR), etc.
4. Explain the organizational assignment in the PA module?
The operating Concern is the highest node in Profitability Analysis.The operating concern is assigned to the Controlling Area.Within the operating concern all the transactions of Profitability Analysis are stored.The operating concern is nothing but a nomenclature for defining the highest node in PA.
5. What is a Company in SAP?
Ans. Company is the organizational unit for which individual financial statements can be drawn according to the relevant commercial law. A company can comprise of one or more company codes. A Company has local currencies in which its transactions are recorded. All company codes within a company must use the same transaction Chart of accounts and the same Fiscal Year. Creation of company in sap is optional.
6. What is a Company Code in SAP?
Ans. Company Code in SAP is the smallest organizational unit of Financial
Accounting for which you draw individual financial statements like Balance Sheet and Profit & Loss Account for purpose of external reporting. The Creation of company code in sap is mandatory.
7. What are the Organizational Elements in SAP FI and describe them?
Ans. The Important organizational elements in SAP FI are
• Company Code
• Business Area
• Chart of Account
• Functional Area
8. What are the other important activities in Profit Center?
The assignments of profit center to the cost center and also assignment of profit center to the material master is what will determine the success of the Profit center posting. If these assignments are wrongly done then the profit center postings will not come in properly.
9. What is a Business Area?
Ans. Business area is a separate area of operations or responsibilities of
organizational units with in a company code and used for internal and external
reporting. Different divisions of each business with in a legal entity are created as Business areas for reporting of each operational areas.
10. What is IBAN Number in SAP?
Ans. IBAN stands for “International bank account number, internationally recognized, unique identification number for a specific bank account.
An IBAN is a series of a maximum of 34 alphanumeric characters, and is made up of a combination of the following elements:
1. The bank country key (ISO-Code)
2. Two check digits
3. Country-specific account number
IBAN maintains in bank details of Customer/Vendor Master data and in House bank,most of the time IBAN is used for foreign currency payments time.
11. Can you assign more than One Company Code to a Company?
Ans. Yes. We can assign more than One ‘Company Code’ to a ‘Company’
All the Company Codes within a Company should use the same Chart of Accounts and the same Fiscal Year, though all company codes can have different Local Currencies.
12. What is a Posting Key and What does it control in SAP?
Ans. Posting key in SAP is a two digits numerical key that determines the type of transaction entered in line items
Posting Keys determines:-
1. Account Types ( A, D, K, M, S )
2. Type of postings i.e. Debit or Credit
3. Field status of transaction
13. What are the Sub modules in SAP Financial Accounting (FI)?
Ans. SAP FI Modules contains the following sub-modules
• General Ledger accounting
• Accounts Receivables
• Accounts Payable
• Asset Accounting
• Bank Accounting
• Consolidation
• Special Purpose Ledger
• Travel Management
14. What is a Functional Area in SAP?
Ans. Functional Area is a organizational unit in accounting that classifies the expenses of an organization by functions. The functional area is use to create P&L A/C in Financial Accounting using cost of sales accounting. E.g. of functional areas are
• Administration
• sales and distribution
• Manufacture
• Production
• Research and development.
15. What is a Credit Control Area in SAP?
The credit control area is an organizational unit that specifies and checks a credit limit for customers. Credit control area can includes one or more company codes
16. What is a Chart of Accounts and types of COA in SAP?
Ans. The chart of accounts in SAP (COA) is a list of GL accounts master record that are used by the organization. A chart of accounts must be assigned to each company code. Chart of Accounts is defined at client level.
Types of Chart of Accounts:-
• Operating chart of Accounts
• Country Specific chart of Accounts
• Group Chart of Accounts.
17. What is the purpose of defining Internal orders.?
Internal Orders are basically used for tracking of costs, which are proposed to be incurred over on a short term basis and time tracking is not of much essence.Eg an Advertisement campaign. Sales Promotion and Exhibition expenses etc.
18. What is a Country Chart of Accounts?
The country-specific chart of accounts in sap contains the G/L accounts needed to meet the country’s legal requirements. Country specific chart of accounts are assigned to company codes and this is optional.
19. What is an Operating Chart of Accounts in SAP?
The operating chart of accounts in sap contains the G/L accounts that uses for posting in company code for daily activities and used in both financial accounting and cost accounting. You have to assign operating chart of accounts to a company code.
20. What is Group chart of Accounts and its purpose?
The Group chart of accounts in sap contains the G/L accounts that are used by the entire corporate group and this COA is used to consolidate the reports for the entire corporate group.
21. Which COA is used for day to day postings?
- Operating chart of accounts
22. How many charts of accounts can be assigning to one company code?
One chart of accounts can be assigned to several company codes, and you will not be able to assign more than one chart of accounts to a single company code.
23. What is a Fiscal Year?
A fiscal year is divided in to number of posting periods and each posting period in a accounting period is defined by a start date and end date
24. What is a Fiscal Year Variant?
Fiscal year variant is used to define the fiscal year.
A Fiscal year variant contains the 12 normal posting periods and 4 special periods. We can define maximum 16 posting periods for each year. Special periods are used for Year-end activities.
25. Which transaction code is used to assign a fiscal year to a company code?
Transaction Code- OB37
26. What is a Posting period variant?
Posting Period Variant is accountable for the opening and closing of periods in a Fiscal Year for postings to take place. The Posting Period Variants (PPV) in SAP is used to control which accounting period is open for postings and ensuring that closed period remain balanced and reconciled. We can assign posting period variants to one or more company codes.
27. What is Opening and Closing Posting Periods?
The posting periods can be maintained as per account type and the year which is to be open & which is to closed. The Posting Period Variant is used to control which accounting period is to be open for posting and ensuring that closed periods are remain balanced and reconciled.
28. What is a year dependent and independent fiscal year variant?
Fiscal year in SAP can be defined as year dependent or Year Independent
Year independent – Same number and dates for the periods every year
year dependent – Periods can be different from year to year
29. How many Chart of Accounts can a Company code have?
A single Company code can have only one Chart of Account assigned to it. The Chart of Accounts is nothing but the list of General Ledger Accounts.
30. What is a Shortened Fiscal Year?
Fiscal year which has less than 12 posting periods is known as shortened fiscal year.
31. Can you explain how do you carry forward Account Balances?
Account balances are carried forwarded from one fiscal year to the next fiscal year by using the SAP standard carry forward program.
32. What is a Retained Earning account? And how many retained earning
accounts can be defined in SAP System?
Account balances are carried forwarded from one fiscal year to the next fiscal year by using the SAP standard carry forward program. Retained earnings account is assigned to each P&L account by specifying a P&L statement account type in the chart of accounts (COA).Each Profit & Loss account is assigned to a Retained Earnings Accounts by key
33. What is a Field Status group?
The field status group specifies which fields are ready for input, which are required entry fields, and which are hidden when entering documents.
34. What is chart of account? What is the relevance of defining chart of account?
A. It is the top level financial structure, contains the GL Accounts we define the all the accounts and one chart of accounts assign to company code and one chart of accounts will assign to many company codes . It is list of Gl accounts and it contains account no , account name, language, length, cost element, blocking information that controls the how an account functions and how a gl account created in company code . COA Key.
35. What is account group? What does it control?
A. IT determines the which fields you need to configure on the GL master record. It is necessary to have at least 2, one for B/S and another one for P&L accounts. It controls the number ranges of GL. The Status fields of the master record of GL Belong to company code area.
36.. What is posting key? What is its role?
A. It controls the line item of GL entry debit and credit.
37. What is business area?
A. Organizational unit of external accounting that corresponds to a specific business segment or area of responsibility in a company. Financial statements can be created for business areas for internal purposes. They are primarily used to facilitate external segment reporting across company codes covering the main operation of a company (product line, Branches). The Business area may be the branch of the company or product lines it deals with
38. While defining chart of account, there is field "manual creaation of cost element" and "automatic creation of cost element", what is it?
A. Generally when ever we are creating cost elements we can create some of exependitures manually some automatically so we can create manually cost elements in defining chart of accounts.
39. After creating a customer/vendor, how can we check that under which account group we have configured this customer/vendor?
A. We can check through customer group and vendor group it was created by ours when we are creating vendor and customer groups.
40. How the system will know that april is your first posting period?
A. Yes the system will find out april was first posting period. While configuring fiscal year we giving april to 1 may to 2, june to 3, like this system will identify april was the first posting period.
41. Define the term "fiscal year" , "posting period varient" & " field status varient".
A. FSGV controls the additional account assignments and other fields that can be posted at the line item level for GL a/c. FSGV can be control at three level i.e.,
1) In OBC4 (ch of a/c’s) - which controls the screen for a particular GL a/c group,
2) Posting Keys - which controls the screen for a particular posting key transaction is taken, &
3) Accounting Groups - which controls the screen for a particular account group i.e., customer group or vendor group.
A. Posting period variant which controls posting periods, both normal and special periods are open for each company code. The posting period is independent of fiscal year variant.
A. Fiscal year is controls the which type year we are following like calendar year, year dependent year.
42. How can you use the additional log in the AP payment program for troubleshooting?
Any errors in a payments run, regardless of the reason, are reported in the additional log, allowing corrections to be made rapidly, reducing error rates.
43. How do you handle cash transactions or single purchase vendors?
Not every vendor needs a new master record. When you only purchase from them once, or when paying cash, a dummy code can be used on the invoice entry, and information traditionally stored in a master record is recorded on the individual invoice.
44. How is debt collection or dunning handled using SAP?
SAP allows for different levels of debt collection notices. Depending on the age of the overdue payment, collection letters can range from reminder notices to legal notifications.
45. How can you maximize productivity when sending out correspondence?
SAP allows you to generate correspondence requests as you work, creating invoices, statements and more, for later printing. This allows you to do all printing as a single batch at the end of the work day.
46. What Fiscal year options are available using SAP?
A fiscal year is nothing more than a designated way to store financial data. In SAP, you have twelve periods and four special periods, allowing for both monthly and quarterly data organization. There are two types of fiscal years that are available: Calender year and Year dependent fiscal year.
47. What types of GL accounts should be posted automatically?
Stock and consumption accounts are the most common, and creating the automatic posting option is fairly simple. In the GL account master record, check the box next to “Post Automatically Only.”
48. What is the organizational assignment in the controlling module?
Every company has a unique company code assigned. The controlling module allows you to create a controlling area which contains all activities related to cost center accounting, product costing and profitability analysis.
49. Describe the relationship between cost center accounting and profit center.
Cost centers allow companies to capture all costs related to daily businesses operations, generally excluding unavoidable monthly expenses like rent or utilities. Administrative, entertainment, food and other expenses fall under this heading. Profit centers capture data related to both cost and revenue, showing how much each dollar of profit costs to generate.
50. What are one-time vendors ?
A. In certain industries (especially where there are a high volume of cash transactions), it is not practical to createnew master records for every vendor trading partner.One-time vendors allow for a dummy vendor code to beused on invoice entry and the information which isnormally stored in the vendor master (payment terms,address etc) , is keyed on the invoice itself
51. Explain briefly how you can import electronic bank statements into SAP.
A text file is received from the bank which is thenuploaded into the SAP system. The file contains details of the company’s bank movements e.g. cheques, bank interest, bank charges, cash receipts etc. Depending on thesystem configuration SAP will attempt to book thesetransactions automatically to the correct accounts to avoidthe need for manual entries by SAP users. Any postings which the system cannot derive automatically can be booked through “post-processing”
52. Explain the purpose of the account type field in the GLmaster record
A:At year end P&L accounts are cleared down to theretained earnings balance sheet account. This fieldcontains an indicator which is linked (in the IMGtransaction OB53) to the specific GL account use in thisclear down
53.What is a sort key and what is it used for?
A:Sort keys are stored in customer, vendor and GLmaster records. They determine what value is populated inthe ‘assignment’ field in the document line items posted.There are several standard entries in a pre-delivered SAPsystem and additional entries can be configured if required. A very common use for sort key 014 Purchase Ordernumber for example, is to allow the GR/IR clearing GLaccount to be cleared automatically.For FI/CO jobs in a logistics environment this is a commonquestion
54. . Where to assign activity type in cost centers? OR how to link cost centers & activity types?
>> There is no direct assignment. You plan the output for a cost center first in kp26. Then you’ve to plan the value of that cost center which you budget for a period in kp06. Planned Activity expenditure / Planned Actvty qty gives yoa planned act rate which you can use to valuate your activity confirmations in mfg ordrs. You can also define your own prices,but you have to run the price revaluation if you want to revaluate your actual activity prices.
55. For stat. key figure what is the significance of sender & receiver cost elements & cost centers?
>> Stat key fig are not real account assignments. In simple traditionl terms it is the base to allocate or define praportions with which the cost is allocated. SKFs are used to calculate the debit on a receiver object. These values can be used for assessing common costs which are used by all the other cost centers.
56. What is chart of account? What is the relevance of defining chart of account?
A. It is the top level financial structure, contains the GL Accounts we define the all the accounts and one chart of accounts assign to company code and one chart of accounts will assign to many company codes . It is list of Gl accounts and it contains account no , account name, language, length, cost element, blocking information that controls the how an account functions and how a gl account created in company code . COA Key.
57. What is account group? What does it control?
A. IT determines the which fields you need to configure on the GL master record. It is necessary to have at least 2, one for B/S and another one for P&L accounts. It controls the number ranges of GL. The Status fields of the master record of GL Belong to company code area.
58. What is posting key? What is its role?
A. It controls the line item of GL entry debit and credit.
59. What is business area?
A. Organizational unit of external accounting that corresponds to a specific business segment or area of responsibility in a company. Financial statements can be created for business areas for internal purposes. They are primarily used to facilitate external segment reporting across company codes covering the main operation of a company (product line, Branches). The Business area may be the branch of the company or product lines it deals with
60. While defining chart of account, there is field “manual creaation of cost element” and “automatic creation of cost element”, what is it?
A. Generally when ever we are creating cost elements we can create some of exependitures manually some automatically so we can create manually cost elements in defining chart of accounts.
61. After creating a customer/vendor, how can we check that under which account group we have configured this customer/vendor?
A. We can check through customer group and vendor group it was created by ours when we are creating vendor and customer groups.
62. How the system will know that april is your first posting period?
A. Yes the system will find out april was first posting period. While configuring fiscal year we giving april to 1 may to 2, june to 3, like this system will identify april was the first posting period.
63. Define the term “fiscal year” , “posting period varient” & ” field status varient”.
A. FSGV controls the additional account assignments and other fields that can be posted at the line item level for GL a/c. FSGV can be control at three level i.e.,
1) In OBC4 (ch of a/c’s) – which controls the screen for a particular GL a/c group,
2) Posting Keys – which controls the screen for a particular posting key transaction is taken, &
3) Accounting Groups – which controls the screen for a particular account group i.e., customer group or vendor group.
A. Posting period variant which controls posting periods, both normal and special periods are open for each company code. The posting period is independent of fiscal year variant.
A. Fiscal year is controls the which type year we are following like calendar year, year dependent year.
64. How is cost center accounting related to profit center?
In the master data of the Cost Center there is a provision to enter the profit center. This way all costs which flow to the cost center are also captured in the profit center.Cost centers are basically created to capture costs eg admin cost center ,canteen cost center etc Profit centers are created to capture cost and revenue for a particular plant, business unit or product line.
65. What is a cost element group?
Cost element group is nothing but a group of cost elements which help one to track and control cost more effectively. You can make as many number of cost element groups as you feel necessary by combining various logical cost elements.
66.What is a cost center group?
In a similar line the cost center group is also a group of cost centers which help one to track and control the cost of a department more effectively. You can make as many number of cost centers as you feel necessary by combining various logical cost centers Infact you can use various combinations of cost center group with the cost element group to track and control your costs per department or across departments
67. What is the difference between Distribution and Assessment?
Distribution uses the original cost element for allocating cost to the sender cost center. Thus on receiving cost center we can see the original cost element from the sender cost center. Distribution only allocates primary cost.
Assessment uses assessment cost element No 43 defined above to allocate cost. Thus various costs are summarized under a single assessment cost element. In receiver cost center the original cost breakup from sender is not available. Assessment allocates both primary as well as secondary cost.
68.What are the other activities in Cost center?
If you have a manufacturing set up entering of Activity prices per cost center/activity type is an important exercise undertaken in Cost center accounting.
69. How does SAP go about costing a Product having multiple Bill of materials within it?
SAP first cost the lowest level product, arrives at the cost and then goes and cost the next highest level and finally arrives at the cost of the final product.
70. What do you mean by primary cost component split ?
Primary cost split is defined when you create a cost component structure.When you switch on this setting, the primary cost from the cost center are picked up and assigned to the various cost components.
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