1. What is the company code in SAP?
To generate financial statements like Profit and Loss statements, Balance sheets etc. company code is used. ( SAP FICO interview questions and answers )
2. How many Chart of Accounts can company code have?
You can have one Chart of Account for one company code which is assigned.
3. For a Company Code how many currencies can be configured?
There are three currencies that can be configured for a Company code, one is a local currency and two are the parallel currencies.
4. 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:
a) Calendar Year: From Jan-Dec, April-March
b) Year dependent fiscal year
5. What is a ‘year shift’ in the SAP calendar?
SAP system does not know what is broken in the fiscal year e.g. April 2012 to March 2013 and only understands the calendar year. If, for any business, the fiscal year is not a calendar year but the combination of the different months of two different calendar year and then one of the calendar year has to classified as a fiscal year for SAP and the month falling in another year has to be adjusted into the fiscal year by shifting the year by using the sign -1 or +1. This shift in the year is known as ‘year shift’.
Example: April 2012 to Dec 2012 is our first calendar year, and Jan 2013 to March 2013 is our second year, now if you are taking April-12 to Dec-12 as your fiscal year, then Jan-13 to March-13 automatically becomes the second year, and you have to adjust this year by using -1 shift, and vice versa if the scenario is reversed, here you will use +1 shift.
6. What is the 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 2005, month January end on 29th, month Feb ends on 26th etc.
7. In SAP how input and output taxes are taken care of?
For each country tax procedure is defined, and tax codes are defined within this. There is a flexibility to either expense out the Tax amounts or capitalize the same to stocks. SAP FICO interview questions and answers
8. Explain what validations and substitutions are in SAP?
For each functional area in SAP Validation or Substitution is defined eg, Assets, Controlling etc. at the following levels
a) Document Level
b) Line item Level
9. What are the application areas that use validation and substitutions?
a) FI- Financial accounting
b) CO-Cost accounting
c) AM-Asset accounting
d) GL-Special purpose ledger
e) CS-Consolidation
f) PS-Project system
g) RE-Real estate
h) PC-Profit center accounting
10. If you want to carry forward the balance from one fiscal year to the next fiscal year. Which account type should you use?
Retained Earnings Accounts are used to carry forward the balance from one fiscal year to the next fiscal year. You can assign a Retained Earning account to each Profit and loss account P&L account in the chart of accounts COA. To automatically carry forward the balance to next fiscal year you can define P&L statements as per COA and assign them to retained earning accounts.
11. What are the different steps involved in G/L posting?
After you complete the payroll run, next is to add results to the GL accounts and this includes cost centers. GL posting includes the below steps −
Groups together posting-relevant information from the payroll results.
- Creates summarized documents.
- Performs the relevant postings to appropriate GL accounts and cost centers.
12. What is the use of the fiscal year variant? How many variants can you use?
It contains the number of posting periods in the fiscal year and number of special periods. You can define up to 16 posting periods in a fiscal year in controlling component CO.
You need to specify the fiscal year variant for each company code. When you create a controlling area, you also need to specify the fiscal year variant.
The fiscal year variants of the company code and controlling area may only differ in the number of special periods used. You need to ensure that the fiscal year variants match, in other words, they may not have a time conflict. SAP FICO interview questions and answers
13. What is the use of posting period variants?
SAP FI Posting period variant is used to maintain accounting periods that are open for posting and all closed periods are balanced. This is used for the opening and closing period in the fiscal year for posting purposes.
You can assign these posting periods to one or more company codes.
14. What is the difference between field status variant and field status group?
Field status variants will have filed status groups. Field status group is maintained in the GL account and It defines the field while posting to the GL.
15. What are the different account types in SAP FI? How do you identify account types?
Posting Keys in SAP FI is used to determine Account types (A, D, K, M, and S) and also the type of posting. It is a 2 digit numerical key.
16. Different Account Types in SAP FI −
- A = Assets
- D = Customers
- K = Vendors
- M = Materials
- S = General Ledger Account
17. What are the common document types in FI?
Common Document types Key are −
- Document Type Description
- AA Asset Posting
- AN Net Asset Posting
- DR Customer Invoice
- DZ Customer Payment
- KA Vendor Document
- KG Vendor Credit Memo
18. When a G/L document is not complete and you want to save the document at a later stage, how can you manage this in FI?
You can also hold posting of a G/L document or temporarily save the document in below conditions −
- When G/L document is not complete
- Incomplete/Incorrect Information in the document
- To save the document at later stage
19. What are one-time vendors?
In certain companies, especially the one dealing with high cash transactions, it is not practical to create new master records for every vendor trading partner. One time vendors allow a dummy vendor code to be used on invoice entry and also the information which is usually stored in the vendor master.
20. What are the standard stages of the SAP payment run?
The following steps are the standard stages of the SAP payment run
- a) Entering of parameters ( Vendor Accounts, Company Codes, Payment Methods)
- b) Proposal Scheduling – the system proposes the list of invoice paid
- c) Payment booking- the booking of the actual payments in the ledger
- d) Printing of payment forms ,example cheque
21. In Accounts Receivable, what is the difference between the ‘Residual Payment’ and ‘Part Payment’ methods of allocating cash?
‘Residual payment’ and ‘Part payment’ are the two methods for allocating partial methods from customers. For example, an invoice for $100 is generated, and the customer has paid $70. Now this $70 will be off-set and leaving the remaining balance $30. With residual payment, the invoice is cleared for the full value of $100 and a new invoice is generated for the remaining balances $30.
22. What is “dunning” in SAP?
‘Dunning’ is the process by which payment chasing letters are issued to customers. SAP can determine which customers should receive the letters and for which overdue items. Different letters can be printed in SAP depending on the overdue payment date, with a simple reminder. With the help of the dunning level on the customer master, we can know which letter has been issued to the customer. SAP FICO interview questions and answers
23. What is the purpose of the account type field in the GL (General Ledger) master record?
At the end of the year, profit and loss accounts are cleared down to the retained earnings balance sheets account. The field contains an indicator which is linked to a specific GL (General Ledger) account to use in this clear down.
24. Explain what recurring entries are and why they are used?
Recurring entries can eliminate the need for the manual posting of Accounting documents which do not change from month to month. For example, an expense document can be generated which can be scheduled for the last days of each month or whenever an individual wants it. Usually multiple recurring entries are created at one go and then processed all together as a batch month end using transaction.
25. What is a ‘Value Field’ in the CO-PA module?
Value fields are number or value related fields in profitability analysis such as quantity, sales revenue, discount value etc.
26. What are the statistical internal orders?
Statistical internal orders are dummy cost objects used for reporting and analysis purposes. It must be posted in conjunction with a real object such as a cost center.
27. For what purposes internal orders can be used?
You can use internal orders for
- Overhead Orders: It monitors internal jobs settled to cost centers
- Investment Orders: It monitors internal jobs settled to fixed assets
- Accrual Orders: Offsetting posting of accrued costs calculated in CO
- Orders with Revenue: It display the cost controlling parts of Sales and Distribution, it does not affect the core business of the company
28. What is financial accounting?
SAP FI stands for Financial Accounting and it is one of the important modules of SAP ERP. It is used to store the financial data of an organization. SAP FI helps to analyze the financial condition of a company in the market. It can integrate with other SAP modules like SAP SD, SAP PP, SAP MM, SAP SCM etc.
29. Why do we use SAP FI?
SAP Financials accounting module enables you to manage financial accounting data within an international framework of multiple companies, currencies, and languages. SAP FI module mainly deals with the below financial components :−
- Fixed asset
- Accrual
- Cash journal
- Accounts receivable and payable
- Inventory
- Tax accounting
- General ledger
- Fast close functions
- Financial statements
- Parallel valuations
- Master data governance
- What are the different submodules in SAP FI?
- General Ledger
- AR/AP
- Banks
- Fixed Assets
- Travel Management
- Lease Accounting, etc.
(SAP FICO interview questions and answers)
30. What is General Ledger in Finance accounting?
A General Ledger contains all the transaction details of a company. It acts as the primary record to maintain all accounting details. Common general ledger entries are customer transactions, purchases from vendors, and internal company transactions. SAP FICO interview questions and answers
31. What is a Company in SAP FI? What does it consist of?
A company is defined as the smallest unit for which financial statements can be created in accordance with commercial legal regulations.
In SAP FI, a company can comprise multiple codes, however it acts as a single unit for which financial statements are available. All the company codes must use the same chart of accounts list and fiscal year however each code can have a different local currency.
32. How do you manage transactions that come from different lines of business in a company?
Business Areas are used to differentiate transactions that come from different lines of business in a company.
Example:
There is a big company called XYZ, which runs multiple businesses. Let us say it has 3 different domains like manufacturing, marketing and sales.
Now you have 2 options −
- First is to create different company codes
- And another better option is to create each of these business lines into business areas.
33. Explain 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
- Account Types
- Types of posting. Debit or Credit
- Field status of transaction
34. What is the company code in SAP?
To generate financial statements like Profit and Loss statement, Balance sheets etc. company code is used.
35. How many Chart of Accounts can company code have?
You can have one Chart of Account for one company code which is assigned.
36. For a Company Code how many currencies can be configured?
There are three currencies that can be configured for a Company code, one is a local currency and two are the parallel currencies.
37. 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:
- Calendar Year: From Jan-Dec, April-March
- Year dependent fiscal year
38. What is a ‘year shift’ in SAP calendar?
SAP system does not know what is broken fiscal year e.g. April 2012 to March 2013 and only understand the calendar year. If, for any business, the fiscal year is not a calendar year but the combination of the different months of two different calendar year and then one of the calendar year has to classified as a fiscal year for SAP and the month falling in another year has to be adjusted into the fiscal year by shifting the year by using the sign -1 or +1. This shift in the year is known as ‘year shift’.
Example: April 2012 to Dec 2012 is our first calendar year, and Jan 2013 to March 2013 is our second year, now if you are taking April-12 to Dec-12 as your fiscal year, then Jan-13 to March-13 automatically becomes the second year, and you have to adjust this year by using -1 shift, and vice versa if the scenario is reversed, here you will use +1 shift.
39. 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 2005, month January end on 29th, month Feb ends on 26th etc.
40. 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. SAP FICO interview questions and answers
Bonus: What do you know about the Substitutions and validations in SAP?
They are generally defined assets for the different functional area. They can be accessed through two options and they are Document level and the line level.
SAP FICO interview questions and answers
SAP FICO interview questions | SAP FICO interview answers
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