SAP FICO

Interview Questions and

Answers

Q1. What do you know about SAP FICO?

SAP FICO stands for Financial Accounting and controlling. It is one of

the important tools which is useful in preparing the statements about
the finance related to an organization or company or a business. SAP
FICO consists of two modules, SAP Finance (FI) and SAP Controlling
(CO), each of which is used for specific financial processes.

Q2. What are the important Sub modules of SAP FI?

• The important sub-modules of SAP financial accounting are

General Ledger -FI-GL

Accounts Receivable -FI-AR

• Accounts Payable -FI-AP

• Asset Accounting -FI-AA

Bank Accounting -FI-BA

Q3. What are the other modules to which Fl is integrated?

• The other modules to which FI is integrated are

Sales and Distribution (SD)

• Material Management (MM)

• Human Resource (HR)

• Production Planning (PP)

• Controlling (CO)

Q4. What are the organizational elements in SAP-FI?

• Company Code

Business Area

• Chart of Account

• Functional Area

Q5. What is the company code in SAP?

•Under company code you can generate individual financial statements

like profit & loss account and balance sheets.

Q6. What are the different Types of COA in SAP FICO?

• Operating COA: Operating COA for an organization contains all the
General ledgers that it uses in a day to day posting.

• Country Specific COA: General Ledger accounts in country specific

charts of accounts are created to fulfill legal requirements of a
particular country.

• Group COA: General Ledger accounts created under a group chart of

accounts are used by the entire corporate group

Q7. 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 variant that is:

1.Calendar Year: From Jan-Dec, April-March

2. Year dependent fiscal year

• In Indian -12 posting periods (April - March) with 4 Special Periods -

V3

• In US-12 posting periods (Jan - Dec) with 4 Special periods - K4

• Some other companies follow posting periods from July June or

October to September with 4 Special periods.

Q8. What is year dependent fiscal year variant?

• In a year dependent fiscal year variant, the number of days in a month

is not as per the calendar month. For example, in year 2019, month
January end on 29th, month Feb ends on 26th etc.

Q9. What is posting period variants?

• In fiscal year posting period is a period for which the transactions

figures are updated. The posting period variants in SAP is accountable
to control which accounting period is open for posting and ensures that
the closed periods remain balanced.

Q10. What is Shortened Fiscal Year?

•If the number of periods in a fiscal year is less than number of periods
in the calendar year then it is called a shortened fiscal year. It is used in
situations when a fiscal year should be shorter than 12 months.

Q11. What is field status?

Field status group is a group configured in FSV -Field Status Variant to

maintain field status for G/L (General Ledger) accounts. It controls
which field should suppress, display, optional and required.

Q12. Define field status group?

Field status groups control the fields which come up when the user
does the transactions. In FIGL (Financial General Ledger) master, the
field status group is stored.

Q13. What is Posting Key?

• Posting Key is a 2-digit numeric key. To control the entry of document

line items in a FI Transaction. Posting key determines.
• Account Types (A, D, K, M, S).

• Types of posting. Debit or Credit.

• Field status of transaction.

Q14. What is Document type in SAP?

• The document type is a key that is used to classify accounting

documents and distinguish between business transactions to be
posted. the document type is entered in the document header and
applies to the whole documents.

. The purpose of Document type in SAP is

• Define Number range for documents

• Controlling the posting to account types e.g. Assets, Vendor,

Customer, Normal GL account

It is used for the reversal of entries.

SAP FICO
Accounts Payable
Q1 What is Accounts Payable?

Accounts payable is any sum of money owed by a business to its

suppliers shown as a liability on a company's balance sheet. In simple
words, when you buy goods or services with an arrangement to pay at a
later date, such amount till it is paid is referred to as accounts payable.
ad paid is referred

Accounts payable is also called as bills payable and the total amount
that a company is liable to pay is shown as liability under the head
'sundry creditor' in the balance sheet.

Q2. What are segments in Vendor Master?

a. General Data segment

b. Company code segment

c. Purchase Organisation segment

Q3. What is Vendor Account Group ?

•Vendor Account Group is to bifurcate the vendors like FI Vendors, MM

Vendors, Foreign Vendors, Domestic Vendors.

Q4. What are the steps for creating Vendor ?

1. Account Group of Vendor

2. Create Number ranges for Vendor account. wal

3. Assign number ranges for vendor account group.

4. Document types for vendor accounts

5. Create G/L master record for sundry creditor

6. Create vendor master record.

Q5. What is a special G/L Transactions?

•Special G/L transactions are transactions that are not normal business
transactions with our business partners. They are generally shown in
different control ledgers and are not grouped with the normal
transactions. They include Bills of exchange, Down Payment, Bank
Guarantees.

Q6. At what level are the customers & Vendors codes are stored?

•The customer and vendor codes are at the client level, that means any
company code can use the vendor and customer code by extending the
company code view in their master data.

Q7.How are the Vendor Invoice payment made?

Manual Payments without the use if any output medium like cheques
etc.

• Automatic payment programs through cheques, wire transfers, DMS

etc.
Q8.Can we change the reconciliation account in the vendor master?

• Yes, Reconciliation account can be changes in the vendor master

provided that the authority to change has been configured. Normally we
should not change the reconciliation account

Q9. What is the impact on the old balance when the reconciliation
account in the Vendor Master is changed

•Any change you make to the reconciliation account is prospective and

not retrospective. The old items and balances do not reflect the new
account, new transactions reflect the Count

Q10. What do you mean by Down Payment?

•Down Payment are used for short or medium Financing. Down

payments are generally made before production. Down payments must
be displayed separately in the balance sheet.

Q11. Where we give the link for Down Payment posting ?

• Special G/L to Reconciliation

Q12. How can you link vendor as a customer, customer as a vendor ?

• Yes, it is possible, we can give the link in vendor master data under
Control Data(XK02).

Q13. What are Terms of Payment?

• Terms of payment are the conditions to settle the invoices. The
payment terms are used to determine base line date for due date of
invoices. Cash discount periods, Cash discount percentage.

Q14. In Payment Terms configuration, what are the options available

for setting a default date?

• There are 4 options available

1. No Default 2. Posting date 3. Document date and 4. Entry Date.

• Posting Date is "goods receipt date”. The document date is “party bill
date". Entry date is "Quality approved date".

Q15. Where are the Payment terms for vendor master maintained?

• Payment terms for vendor master can be maintained at two places in

Accounting View and Purchasing View.

Other Questions
Q1. How can we block, a particular payment term for a particular
vendor?

We have Two Methods for Vendor Block in APP

1. Vendor Creation: Block under Automation Payment Transaction hurt

Automation Payment al
2.APP Run: Edit Proposal Button in APP.

Q2.I run my app and I printed my check and after that I find that I made
a mistake of wrong payment to related vendor, now what can I do can I
stop app.. And can I stop payment and can't delete proposal and
payment in app? And can I run new app towards new vendor?

• You will not be able to delete proposal after payment run. If you want
to delete proposal then, rwar Second, You have to delete payment run
from EDIT > PAYMENT > DELETE OUTPUT.

First you have to manually reset & reverse the posting generated FBRA.

Third and then you will be able to delete proposal EDIT > PROPOSAL >
DELETE.

For e.g. It is like you have executed the third step and then you want to
reverse the second step. So, you have to reverse or delete the third step
and then you will be able to delete the second step.

Q3. What is internal number range? What advantages & risk?

• if we assigned internal number range it picks up automatically like

1,2,3, that of document numbers

If we assigned external number range to system then we can assigned

any number in between the range. if given 10000 to 199999. we can
pick up 100000 num then 100020 100030 100007 like that.

Q4. We have a company with 4 branches and one factory. How do you
start configuring?

• if this is the case first we need to define a company code in FI(OX02),

and Define business areas as given 4 branches in questionary.

Define plant that be assigned company code.

Q5.Can u explain what is the purchase life cycle and with entries?

1. When PO is created

No Entry -----

2. When GR is posted

Inventory Account dr (Transaction Key BSX in OBYC) To GR/IR account

(T.Key WRX in T-code OBYC)

3. When Invoice is posted

GR/IR account Dr. Vendor account

4. Payment made to Vendor

Vendor A/c Dr To Bank Clearing A/c Cr.

Q6. What is the entry date, document date, posting date, value date,
and next run date.

1. Entry Date

- System Date on which document is entered

2. Document Date Date of the supporting document ie PO/invoice/ Bill
date

3. Posting date

- date on which entry is posted to the ledger or accounting date

4. Value date

- the date on which doc is valued. ie for forex valuation the value date is
needed for calculating the exchange rate difference

5. Next run date ext run this is for payment run. what the next day for
calculating the payment due document

and discount calculation

Q7. Can we create P.O. for multiple vendors? How can we create it?

• yes you can create p.o. for multiple vendors by using "ME21N" Only
one p.o. number can belongs to one vendor. same P.O. number (same
P.O.) can not belongs to multiple vendors.

Q8. Bank Master Key is created at client level or Company code level?
Illustrate with examples & your prior project experience?

• Bank Keys can be created at country level in FI01 T-Code not at

company code level. Here bank keys are different from House Banks.

Q9. There is two company code with a common tax code. can it
possible to define different GL accounts with single tax code...and the
chart of A/c is same for both company codes?
• Tax code is always been defined at country level only, for Single tax
code we can't define two different G/L accounts, at the time of defining
only it will show the error of duplicate entry.

Q11. Tell something about Parallel local currency in SAP?

Organizations are allowed to add two more currency option than their
local. They can be used in the transactions made at International level
by an organization. The organizations are free to use any two options
for parallel that they seem to have more need. They can be tagged as
Group currency and hard Currencies .

Q12. What are the biggest benefits that you can have with the SAP
FICO?

There are certain benefits and a few major ones are spotlighted below:

One of the major benefit is accounting data is always correct. The

users doesn't need to worry about this The users doe

• There is no upper limit on handling the accounts. Any number of

accounts can be managed

• It is useful in auditing as an eye can be kept on the transactions made

by the business eye can

• It make sure of financial transparency cial transpare

• The detailed information about the expenses can be prepared and the
same can then be considered for the purpose of preparing the future
budgets

• A lot of time and money can be saved

• The users can make sure of financial outputs that can be trusted in
the long run

Q13. How taxes are taken care of in the SAP FICO?

• One of the major issues is Tax Slabs are not similar in all the
countries. Also, there are additional taxes applicable there. SAP FICO
has tax procedure already defined in it for various nations and the users
are free to get the information regarding the same. The Tax amounts
can be sent to stocks by default or the users are free to make
challenges in them as per their need and convince. Thus, taxes are not
an issue with the SAP FICO.

Q14. What is Financial Statement version in the SAP FICO?

It is basically a tool that is used for reporting. All the financial accounts
can be extracted through it along with all the relevant information
required by the users. It is possible to deploy it for the purpose of
generating the outcomes of different agencies associated with a
business. The same information can then be passed to the concerned
authorities for the betterment.

Q15. What is credit control area in the SAP and What options do you
need to fill when it comes to creating the Credit Control Area?

• The credit control is in the SAP enable the organization to impose a

strict upper limit on the credit for the customers. This can be done by
using the option controls are in the SAP. It simply makes sure of
avoiding the situation such as risk of bad debts and outstanding
receivables. f bad debts and
• The user needs to provide the controller name, Description, Currency
option is to be selected, risk category is to be selected and then the
vide the information about the Fiscal variant is also to be provided.

Asset Accounting
1. Explain Asset Accounting (FI-AA).

The Asset Accounting (FI-AA) sub module in SAP manages a

company's fixed assets, right from acquisition to retirement/scrapping.
All accounting transactions relating to depreciation, insurance, etc., of
assets are taken care of through this module, and all the accounting
information from this module flows to FI-GL on a real-time basis.

2. What is a Chart of Depreciation?

The Chart of Depreciation is a list of Depreciation Areas arranges

according to business and legal requirement. Chart of Depreciation is
used in order to manage various legal requirements for the depreciation
and valuation of assets. Each company code is allocated to one chart
of depreciation.

3. Define Depreciation Areas.

Fixed assets are valued differently for different purposes (business,

legal, etc.). SAP manages these different valuations by means of
'Depreciation Areas. There are various depreciation areas such as book
depreciation, tax depreciation, and depreciation for cost- accounting
purposes, etc.

• A depreciation area decides how and for what purpose an asset is

evaluated. The depreciation area can be 'real' or a 'derived one.' You
may need to use several depreciation areas for a single asset
depending on the valuation and reporting requirements. The
depreciation areas are denoted by a 2-character code in the system.
The depreciation areas contain the depreciation terms that are required
to be entered in the asset master records or asset classes.

4. What is an Asset Class?

• An 'Asset Class' in SAP is the basis for classifying an asset based on

business and legal requirements. It is essentially a grouping of assets
having certain common characteristics. Each asset in the system
needs to be associated with an asset class. An asset class is the most
important configuration element that decides the type of asset (such as
land, buildings, furniture and fixtures, equipment, assets under
construction, leased assets, low value assets, etc.), the document
number range, data entry screen layout for asset master creation, GL
account assignments, depreciation areas, depreciation terms, etc. An
asset class is defined at the Client level and is available to all the
Company Codes of that Client.

5. Why do you need Asset Classes?

• An 'Asset Class' is the link between the asset master records and the
relevant accounts in the GL. The account determination in the asset
class enables you to post to the relevant GL accounts. Several asset
classes can use the same account determination provided all these
asset classes use the same accounts.

6. What is Account Determination?

•One of the most important functions of the Asset class to be establish

the connection between the Asset master record and the
corresponding accounts in the general ledger in Financial accounting.
This connection is created by the account determination key is asset
class.

7. What is Depreciation key?

A key for calculating depreciation amounts. There is a direct link

between asset and company code. Which we link between the
depreciation key and master record.

8. What is an asset master? What does it control for sub asset master?

An asset master represents the master record and information about a

particular asset. According to the screen layout of asset master, it
controls the following sub assets. master, it contro

• Sub assets master number assignment

• Assignment of depreciation key

• Determination of life asset

determination of assignment of group asset.

9. How many depreciation areas can be defined for a Company Code ?

•Depreciation areas are not defined for company codes rather

depreciation areas are defined for a chart of depreciation, A maximum f
99 depreciation areas cab be maintained for a Chart of Depreciation.
10. What are the types of Depreciation methods?

• Baseline value method.

• Decline value method.

• Maximum method.

• Multi level method.

• Period control method.

11. Is it possible to create an asset class automatically?

There are two ways

1. Create an asset class with reference to an existing asset class

2.Generate an asset class code(ANKL).

12. What is the difference between COA and COD ?

The chart of Accounts is the index of G/L accounts. The Chart of

Account can be global, country specific or industry specific based on
the need of business. The COD is the index of depreciation areas. The
is only country specific.

13. Is it possible to have depreciation calculated for the day?

•Yes, it is possible. You need to switch on the indicator Depreciation to

the day in the a depreciation key configuration.