SAP® Financial Accounting (FI) collects and stores business transactions in a way that satisfies external reporting requirements. Due to online integration within itself and with other modules, it allows managers to assess the financial position of the company in real time. It handles financial relations with vendors and customers, such as booking receivables and payables, sending and collecting payments, issuing dunning notices and account statements. Interface with banks (processing outgoing and incoming payments, posting bank statements) is also done within this module.
Financial Accounting in SAP consists of:
- General Ledger Accounting (FI-GL) - the core of FI and of financials in general, providing the basic financial reports such as balance sheet, P&L statements or data for VAT returns. Due to its importance in the whole financial reporting structure, all "general settings" that are shared by all submodules (e.g., organizational structures, document types or posting periods) are described under this heading.
- Accounts Receivable (FI-AR) - all financial relations with customers
- Accounts Payable (FI-AP) - all financial relations with vendors
- Asset Accounting (FI-AA, formerly known as "Asset Management" FI-AM) - supports acquisition, depreciation and retirement of fixed assets
- Bank Accounting - processing of bank statements
It is online integrated with:
- Controlling (CO) - all postings to P&L or certain fixed asset accounts that are created as cost elements are automatically updated on cost center, internal order or profitability segment reports in controlling and can be further processed from there (settled, allocated etc.). On the other hand, allocations within controlling that cross FI organizational structure (e.g., bookings across profit centers or segments) can be online or periodically transferred back to FI.
- Logistics - all material movements that are relevant for accounting (goods receipts, sales, scrapping, etc.) are online updated in accounts. The same holds about vendor invoices, as soon as they are posted. Sales invoices can be generated online or in batch.
- Project System and Investment Management (PS-IM) - data are updated online in the same way as for Controlling.
As with all other modules, the structure of Financial Accounting in SAP consists of
- Standard SAP functionality (e.g. database tables, user and expert transactions) that is delivered with the system and should not be changed unless there is a strong business need
- Configuration settings, which are prepared by IT specialists according to the needs of a specific enterprise
- Master data, entered and maintained by business users, to be used repeatedly for many transactions over a long period of time
- Transactional data, entered or managed by business users and relating to a single business transaction.
The key configuration objects in FI are:
- Chart of Accounts, providing a framework for creating GL accounts. Each company code (see below) has to be assigned to one primary chart of accounts and up to two alternative ones. One chart of accounts may be shared by multiple company codes.
- Company Code, the basic organizational structure in accounting on which all financial (though not controlling) reports are created. In most companies, it represents the whole legal entity or, less frequently, a part of a legal entity that has to be reported separately to external authorities (e.g., a foreign branch).
Key master data in FI are:
- General Ledger Account
- Profit Center (formerly part of Controlling) - an organizational unit within or across company codes, on which it is possible to display balances and movements of GL accounts
- Vendor - key element of FI-AP
- Customer - key element of FI-AR
- Fixed Asset - key element of FI-AA
Transactional data are represented mainly by a financial document.