April 23, 2018 SAP FICO stands for FI ( Financial Accounting) and CO (controlling). In SAP FICO, SAP FI includes accounting, preparation of financial statements, tax computations etc. while SAP CO take cares of inter orders, cost sheet, inventory sheet, cost allocations etc. It is the software that stores data, computes it and retrieves the result based on the current marketing scenario. SAP FICO prevents data lost and also does the verification and reporting of data. What are the exchange rate “types” in SAP? Exchange rate types are how SAP categorizes the different sets of exchange rates in the R’3 system. By default exchange rate type “M” is used for the rates used to calculate local currency in the SAP system What are the other modules to which ‘Financial Accounting’ is integrated? The other modules to which ‘Financial Accounting’ is integrated are a) Sales and Distribution b) Material Management c) Human Resource d) Production Planning e) Controlling of financial transaction What are “reason codes” used for in the Accounts Receivable module and what are the factors to be considered in their configuration? Reason codes are tags which can be assigned to explain under/overpayments during the allocation of incoming customer payments. They should not be confused with ‘void reason codes’ used when outgoing checks are generated. – During configuration the following are determined: Whether the items booked with these reason codes are to be flagged as disputed items for the purposes of credit management The type of correspondence (if any) to be generated for this reason code as a result of the under/over payment Whether a separate line item should be created to charge off the payment differences to a separate G/L account. What is year dependent fiscal year vMyISAMnt? In a year dependent fiscal year vMyISAMnt, the number of days in a month is not as per the calendar month. For example, in year 2005, the month of January ended on 29th and the month of February ends on 26th etc. What is posting key and what does it control? In order to determine the transaction type which is entered in the line item, a two digit numerical is used known as ‘Posting Key’ Posting key determines a) Account Types b) Types of posting. Debit or Credit c) Field status of transaction What are the options in SAP for Fiscal years? Fiscal year in SAP is the way financial data is stored in the system. In SAP, you have 12 periods and four special periods. These periods are stored in fiscal year vMyISAMnt that is: a) Calendar Year: From Jan-Dec, April-March b) Year dependent fiscal year What is the importance of GR/IR ( Good Received/ Invoice Received) clearing account? GR/IR (Good Received/ Invoice Received) is an interim account. In the legacy system, if the goods are received and the invoice is not received, the provision is made, in SAP at the goods receipt. It passes the Accounting entry debiting the Inventory and crediting the GR/IR account. Similarly, when an invoice is received the vendor account is credited, and the GR/IR account is debited, the GR/IR will show as an un-cleared items till the time the invoice is not received. What is parallel and local currency in SAP? Each company code can have two additional currencies, in addition to the company code, currency entered to the company code data. The currency entered in the company code creation is called local currency and the other two additional currencies are called parallel currencies. Parallel Currencies can be used in foreign business transactions. In order to do international transaction, parallel currency can be used. The two parallel currencies would be GROUP CURRENCY and HARD CURRENCY.