Financial Accounting in R3 Part 1

1
Financial Accounting in R/3Part 1

• Cheryl Calvert
• Lecturer in Accounting
• Victoria University

2
Message for today

• Two concepts
• Segmented master data (gt1 database table), and
• Use of document types and number ranges
• are illustrated using the FI module.
• Segmented master data reduces redundancy in the
  (normalized) database by storing data common to
  more than one entity in one table, and
  entity-specific data in another.
• The above two concepts (segmented master data and
  document typing and numbering) are used
  throughout SAP R/3.

3
Lecture Outline

• Financial Accounting in R/3
• General Ledger
• General Ledger Master Records
• Chart of Accounts
• The Document Principle

4
1. Financial Accounting in R/3

• FI is divided into the following eight areas
• FI-GL General Ledger Accounting. The central task
  of G/L accounting is to provide a comprehensive
  picture of the firm for external accounting.
• FI-LC Consolidations. Combines the financial
  results of companies in the group to show the
  overall financial position of the group as a
  single economic unit.
• FI-AP Accounts Payable. Used to administer
  accounts payable to vendors. Also an integral
  part of the purchasing module.
• FI-AR Accounts Receivable. Used to administer
  accounts receivable from customers. Also an
  integral part of the sales module.

5
Financial Accounting in R/3 (2)

• FI-AA Asset Accounting. Tracks asset values,
  including depreciation, interest, over their life
  from acquisition to disposal.
• FI-SL Special Purpose Ledger. Summary information
  for multiple applications at user-defined level
  of detail.
• FI-FM Funds Management. Supports financial
  checking and control using budgeting techniques.
• FI-TM Travel Management. Offers a complete range
  of procedures for processing business trip data,
  including taxation and payment of travel costs,
  and integration with Controlling (Co) and Payroll
  accounting (HR Payroll).

6
2. The General Ledger

• An AIS will usually consist of two types of
  ledgers
• General Ledger
• Subsidiary Ledger
• General ledger contains numerous individual
  accounts, grouped according to account types
  Eg, expense, cost of goods sold accounts, revenue
• Subsidiary ledgers support specific general
  ledger accounts. Used for a/cs that require more
  detailed information. Eg, accounts payable,
  accounts receivable, inventory, etc.

7
The General Ledger (2)

• Contains one summary ledger per chart of accounts
• The summary account is referred to as a control
  account (or reconciliation account in SAP terms).
  For eg, the balance in the accounts payable
  general ledger control a/c should equal the sum
  of all the individual accounts payable balances

8
General Ledger
Recon. account General ledger control account
Subsidiary Ledger
9
Every account in the chart of accounts has an
associated general ledger account
10
General Ledger in R/3

• The General Ledger is located in the FI module
  (FI-GL)
• Major Functions
• Enter/Display/Block General Ledger Accounts
• Enter/Display/Reverse General Journal
  Transactions
• Balance Day Adjustments
• Recurring transactions
• End of period closing
• Financial calendar
• Balance Sheet/Profit and Loss Statements

11
3. G/L Master Record (1)

• A G/L master record must be created for every
  account to which a posting is to be made.
• For example, you will create a G/L master record
  called Special Equity in student exercise M3.3
  (page 3.16).
• You will post to the Special Equity account in
  M3.8 (page 3.38).

12
G/L Master Record (2)
13
G/L Master Record (3)
Trans. OBD4 define account group
14
G/L Master Record (4)
15
G/L Master Record 2 segments
Company Code 3000 IDES US Inc.
Company Code 4000 IDES Canada
G/L Master Company Code Part
G/L Master Company Code Part
G/L Master Common Chart of Accounts Part
16
G/L Master Record 2 segments
Trans. OB62
17
Reconciliation Accounts
18
4. Chart of Accounts (1)
19
Chart of Accounts (2)
20
Chart of Accounts (3)
Trans. OB13
21
e.g., Nissan Nth America Global Regional Chart
of Accounts
22
Nissan Nth America FI Org. Structure
23
Country/Alternative Chart of Accounts
24
IDES Group Chart of Accounts
25
5. Document Principle

• When you posted your 100 transaction (M3.8) you
  created a document in the G/L module of R/3.
• The following slides outline the requirements for
  posting documents
• The document principle
• Document types
• Document number ranges
• Posting keys
• Account Assignment
• Reversing
• To Post, Park or Hold

Next weeks lecture
26
6. R/3 FI Document Principle

• Postings are always stored in document form.
• A document is identified as a combination of
• Document number
• Company code
• Fiscal year
• The R/3 FI document consists of
• Document header
• 2 999 line items

27
e.g., FB03Display Document
Module 3, p.3.35
Header
Detail
28
e.g., FB03Display Document
Header
Detail
29
R/3 FI Document Principle

• Two of the most important control functions are
• Document type (for the header)
• Posting key (for the line items)

Posting Keys
30
Document Types
31
Document types

• Control the document header
• Used to differentiate business transactions
• Major controls
• The number range of document numbers
• The account types allowed for posting
• Document type AB allows posting to all account
  types.
• All other document types limit the types of
  accounts to which documents can be posted.

32
Trans OBA7 Define doc. types
33
Trans. FS10N Display G/L account balance
Note the various doc. types
34
Document Number Ranges
35
Document Number Ranges

• Defines the allowable range in which a document
  number must be positioned and cannot overlap.
• Internal numbering
• The system stores the last used document number
  and takes the subsequent number for the next
  document
• External numbering
• User enters the original document number.
• Document number range has to be defined for the
  year in which it is used.

36
e.g., FBN1 Maintain number range intervals(part
of Configuration)
37
e.g., FB03Display Document
Header
Detail
38
Summary, this lecture

• Two concepts
• Segmented master data (gt1 database table), and
• Use of document types and number ranges
• are illustrated using the FI module.
• Segmented master data reduces redundancy in the
  (normalized) database by storing data common to
  more than one entity in one table, and
  entity-specific data in another.
• The above two concepts (segmented master data and
  document typing and numbering) are used
  throughout SAP R/3.