SAP® ERP Financials (accessible under the header "Accounting" in the main menu) enable an enterprise to:
- Perform accounting and financial close, to comply with statutory reporting requirements
- Manage financial risk within the organization
- Measure and manage financial performance of various business units
- Handle receivables from customers and payables to vendors
- Run corporate treasury (perform banking transactions, invest in financial instruments)
- Calculate, book and settle travel expenses
- Manage costs and revenues associated with real estate
They are closely integrated with Logistics (especially Material Management and Sales and Distribution), which book their transactions (purchases, sales) online into financial accounting and controlling. It also integrates with Human Resources (posting of salary and other personel expenses).
SAP Financials are divided into the following modules:
- Financial Accounting (FI) - the backbone of finance, providing the majority of financial reports for external as well as internal use. It contains General Ledger Accounting (FI-GL), Accounts Receivable (FI-AR), Accounts Payable (FI-AP), Asset Accounting (FI-AA, formerly known as "Asset Management" FI-AM) and Bank Accounting
- Controlling (CO) - a tool for collecting and reporting costs and revenue per business unit or project, primarily for internal use. It consists mainly of Cost Center Accounting (CO-CCA), Internal orders, Profitability Analysis (CO-PA), Activity Based Costing and Product Cost Controlling. Traditionally, Controlling also contained Profit Center Accounting that has recently moved to General Ledger (FI-GL). The user menu also contains a node for "Cost Element Accounting", which provides the framework (cost elements) for the other parts.
- Financial Supply Chain Management (FIN-FSCM) - its purpose is to optimize financial and information flows within a company and towards business partners. It consists of Credit Management (FIN-FSCM-CR), Biller Direct (FIN-FSCM-BD), Cash and Liquidity Management (FIN-FSCM-CLM), Collections Management (FIN-FSCM-COL), Dispute Management (FIN-FSCM-DM), In-House Cash (FIN-FSCM-IHC), Treasury and Risk Management (FIN-FSCM-TRM) and Debt Recovery Management for Public Sector.
- Enterprise Controlling (EC) - a traditional module for reporting and consolidation. It contains Executive Information System (EIS), Business Planning and Consolidation (BPC) and traditionally also Profit Center Accounting.
- Strategic Enterprise Management (SEM) - its purpose is to assist with the whole performance management life cycle. It consists of Business Planning and Simulation, Business Consolidation, Strategy Management and Performance Management.
- Project System and Investment Management (PS-IM) - technically two separate modules (Project System and Investment Management which are often implemented and used together for managing major projects that have to be broken down into parts (WBS - Work Breakdown Structure) and/or logically grouped together for planning and budgeting.
- Flexible Real Estate Management - an improved version of a traditional SAP Real Estate (IS-RE) module. It handles business transactions relating with land and building: rental, recharging of utilities, correspondence with business partners, etc.
- Bank Applications - specific applications for banks. Do not confuse with Bank Accounting (part of core FI) that cover most banking needs of non-financial enterprises.