How can we learn SAP FICO

SAP FICO

- May 17, 2019

SAP FICO is often used as a comprehensive term for the SAP modules SAP FI and SAP CO.

SAP FI

The FI module from SAP is one of the oldest and most widespread modules in the SAP world and includes all business processes in the area of ​​finance and accounting. This includes accounts receivable and accounts payable as well as general and sub-ledger accounting. The processes mapped via the SAP FI module are used for double bookkeeping, recording of documents on the required accounts and the associated profit determination for external (tax office) and internal purposes (management).

In addition to the statutory publication of the balance sheet and income statement (profit and loss account), the module also offers options for creating internal evaluations. SAP FI has direct interfaces to other modules such as HR or SD.

SAP CO

SAP CO is the module for classic controlling in a company. This includes the control and analysis of the costs, the types of costs and the cost rates that arise and have been booked in the company. Controlling usually reports directly to company management. It uses the tools in the SAP CO module, which can provide comprehensive evaluations and analyzes.

As a result, the strategic and operational corporate goals can be checked for their success and appropriate conclusions can be drawn. SAP CO is divided into a few other sub-areas such as CO-PC (product cost accounting), CO-PA (profitability and market segment accounting) or PCA (profit center accounting).

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The interaction between SAP FI and SAP CO

Originally, both modules were separate from one another, but have now also been combined by SAP as higher-level modules in the accounting area. This is particularly due to the tight process structure, which enables a smooth transition between the two modules. For this reason, SAP FI and CO now only appear as a joint SAP FICO module.

In particular, the financial reporting is closely interlinked in both modules and spreads over a large area in both areas. Therefore, when introducing the module, it usually only makes sense to integrate both sub-areas.

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Module overview SAP FI

The SAP module Financials (FI for short) maps all financial accounting processes. As already mentioned at the beginning, this includes accounts receivable, accounts payable and asset accounting, which are shown in general ledgers and sub ledgers. SAP has designed the processes in the module in such a way that they work according to a document principle with a complete balance sheet and individual document check. Automatic updates guarantee an open, integrated flow of data. All postings in financial accounting always generate a corresponding posting in the general ledger.

The books in accounting

Books in accounting

The general ledger, also known as the general ledger, is the most important book in the SAP FI module. It forms the basis for drawing up a balance sheet and income statement. In addition to the main ledger, a large number of sub ledgers are used. These are categorized according to accounts payable, accounts receivable and assets. There are also books for cash, bill of exchange and check transactions. The sub-ledgers are directly linked to the general ledger and the respective balances create an entry in the general ledger. The following is an overview of the most important books available in SAP FI:

FI-GL: General Ledger Accounting

The task of the general ledger accounting in SAP ERP is the holistic representation of the external accounting, which is realized via individual accounts in the general ledger accounting. The collection and recording of all business transactions achieved in this way in an integrated business software system helps here and ensures that the account management is complete and balanced at all times. It should be emphasized here that the general ledger accounting is integrated at all points in the SAP system at which accounting-relevant documents are generated.

For example in the following places:

  • Asset Accounting (FI-AA)
  • Materials Management (SAP MM)
  • Human Resources (SAP HCM)
  • Accounts Receivable (FI-AR)
  • Accounts Payable (FI-AP)
  • Finance and Risk Management (SAP TRM)

However, the general ledger accounting in SAP FI offers more than just the implementation of legal requirements.

FI-AP: Accounts Payable

In the accounts payable department in SAP, all accounting-relevant information on individual accounts payable is recorded and mapped. The main task of accounts payable is the processing of incoming invoices, e. B. from suppliers. In this component, SAP also forms functions such as the automatic payment of invoices, the management of open items and the master data management of the accounts payable.

FI-AR: Accounts Receivable

Accounts receivable is the counterpart to accounts payable: all accounting-relevant information on accounts receivable is recorded here. In addition to master data management and all accounting-relevant business transactions, SAP FI-AR also offers the automation of payments (e.g. direct debits or down payments).

FI-AA: Asset Accounting

Asset accounting is used in SAP to manage and monitor all property, plant and equipment. In addition to classic asset accounting, which maps the entire life cycle of an asset - from procurement through depreciation to disposal - SAP also offers functions for leasing processing, consolidation preparation and an information system in this component.

FI-BL: Bank Accounting (Bank Ledger)

In the FI-BL module, all payment transactions to banks can be controlled in the company. This also includes the management of bank master data and inventory management (check and bill management) as well as the definition of payment forms and payment procedures, taking into account national characteristics.

FI-SL: Special Purpose Ledger

The FI-SL component allows you to create and maintain your own ledgers (books) for reporting. The self-created ledgers can be managed as a general ledger or as a subledger according to any account assignment terms. Possible account assignment terms are the SAP dimensions (account, cost center, business area or profit center) or self-defined dimensions (region).

FI-TV: Travel Management

The travel management component offered by SAP maps the entire process of a business trip, from the application to the planning to the billing of the trip. By mapping the entire process, travel management has the ability to E.g. to settle the travel expenses in the payment run or to forward the results of the settlement to the individual functional areas.

Chart of accounts and G / L account masters

The chart of accounts contains all G / L account master records and shows the directory of all G / L accounts. The required chart of accounts can be provided and adapted to each company code in the company. This makes it possible to insert, change or remove accounts. The charts of accounts can be adjusted to comply with international accounting standards.

In the standard system, a chart of accounts is assigned to each company code, but a chart of accounts can be assigned to several company codes. This is often the subject of practice, particularly with a view to defining overarching controlling areas that combine several company codes.

The G / L account masters are the basis for uniform accounts in the company. With reference to a consolidated annual financial statement, it is very important that there is a uniform number range across all company codes in the area of ​​G / L account masters. This ensures a consolidated balance sheet through the tools in the FI module. The master records can also be adjusted so that they can work across countries with the respective currencies of the company codes.

Module overview SAP CO

The SAP CO module provides information for decision-makers in management. All of the company's processes can be coordinated, monitored and optimized with the help of controlling. Using the tools in SAP CO, deviations between the actual and plan data can be determined and the cost-related events in the company environment can be documented. Overhead cost controlling, product cost controlling, profitability and market segment accounting and profit center accounting are also among the most important basic functions.

Module overview SAP CO

CO-OM: Overhead Cost Controlling

With SAP CO, controllers have the ability to plan, control and monitor overhead costs in the corporate environment. It thus serves as the necessary basis for arriving at meaningful results in product cost controlling and in profitability and market segment accounting. Overhead costs include, for example, fixed costs, process costs, and complexity costs. The proportion of these types of costs is so high compared to the total costs that they should always be the goal of a comprehensive evaluation.

For this purpose, the CO module offers a variety of tools that can help with cost control, but also with decision-making. The overhead costs are divided into certain categories that define the individual overhead costs and differentiate them from one another. These include:

  • the quantity and price components,
  • the individual cost types,
  • the fixed and variable overheads,
  • the costs incurred in processes and production
  • and much more

The planning tools in the CO module in particular can set company-wide standards that enable internal costs to be monitored and assessed. The regular tasks of the users in the CO module also include comparing the planned costs with the corresponding actual costs. At the end of a posting period, these costs can be evaluated and compared with the planned strategy.

The module is designed in such a way that it can completely map the complex and far-reaching work with overhead costs in one system. In the past, apart from the SAP ERP system, this was only possible through the use of larger software packages.

CO-PC: Product Cost Controlling (Profitability Analysis)

This area analyzes the cost of a company's products or services. Products or services can be broken down into their individual components and the respective costs can be evaluated. In this way, a transparent calculation can be created and planned in controlling. The product cost controlling therefore gives an overview in the so important area of ​​the production costs, which proves to be particularly useful in the competition also in the price formation.

Comprehensive tools in SAP CO allow a detailed analysis of the profitability of a company's product or service.

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CO-PA: Profitability Analysis

The result and market segment calculation is used to determine the contribution margin and profit of the company. The CO-PA component also offers a segment-by-segment view, e.g. B. by business unit or market segment. Market segments can be made up of customers, products, orders or a combination of these, for example. The forms of accounting profitability analysis and imputed profitability analysis are currently supported in profitability analysis.

EC-PCA: Profit Center Accounting

Historically, profit center accounting has long been an independent sub-module in the main CO module. Accordingly, it could be executed and modified using specific programs and your own customizing settings. With the introduction of ERP Release 6.0, however, profit center accounting became an integral part of the functional landscape of SAP CO and was integrated into the other sub-areas. This was mainly due to the development and introduction of the new general ledger in the CO module, which has significant synergies with the profit center accounting.

A profit center can be viewed as an organizational sub-area, the success of which is considered separately. This gives controllers the opportunity to outsource certain activities and company areas to their own profit centers in order to create an even more detailed overview of profits and losses. The division according to profit centers prevents false statements about a considered cost center due to unprofitable sub-areas.

In the SAP CO module, the profit centers are now largely a matter of setting in SAP customizing. Here company preferences and individual considerations of the profit center accounting can be set. In addition to customizing, the creation of master data is also an essential factor when dealing with profit centers in the SAP ERP system.

In the SAP standard, the structure of the master data is largely identical to that of the cost centers. In practice, a profit center represents a mirrored account assignment object, which records and assigns every posting of the account assignment object in question. The profit centers are finally evaluated in the income statement.

FAQ

What is SAP FICO?

SAP Finance and Controlling (SAP FICO) is a central component in SAP ERP Central Component (SAP ECC) that supports the management of financial data. It consists of the two modules SAP Finance (SAP FI) and SAP Controlling (SAP CO). Each of these modules has its own functions for managing certain financial processes.

What does SAP FICO do?

SAP FICO enables balance sheets to be created and managed for analysis and reporting purposes. On the basis of this, companies can then make important business decisions. While SAP FI mainly deals with all financial reporting and accounting, SAP CO, on the other hand, focuses on planning and monitoring costs.

What is SAP FI

The SAP FI module covers all business processes in the area of ​​finance and accounting. It is used to analyze financial parameters in order to assess the company's financial position on the market. This included the accounts receivable and accounts payable as well as the general ledger and sub-ledger.

What is SAP CO?

SAP CO functions as a module for controlling in a company. This includes, above all, the control and analysis of costs, cost types and cost rates that have arisen and been booked in the company. Using SAP CO, this data can be comprehensively evaluated and made available in analyzes.

How can I learn SAP FICO?

SAP offers various certifications that build on previous knowledge. Accordingly, employee certifications are aimed primarily at beginners who have not yet worked with SAP solutions. The specialization certificates, on the other hand, build on the previous knowledge that has already been acquired. The so-called specialist certifications are ultimately suitable for people with sound background knowledge and practical experience.

Summary

The SAP FICO module includes all business processes in the area of ​​internal cost analysis and external cost recording. While the two modules FI and CO were originally separate, they are now known as a merger in the accounting area of ​​the SAP ERP system due to the closely interlinked process structure.

Both modules offer the financial accountants and controllers a large number of tools that are intended to make their work easier and to provide decision-makers with an overview of the possibilities. This enables close cooperation between the departments in the company and ensures comprehensive planning of strategic and operational corporate goals.