co fi integration

India SAP CoE, Slide 1

CO0004: CO Integration with FI CO0004: CO Integration with FI Version 1.0Version 1.0


CO Integration with FI CO Integration with FI

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CO Integration with FICO Integration with FI

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Purpose

Use

Challenge

Agenda


PurposePurposeAll functional processes finally end in accounting entries with various cost All functional processes finally end in accounting entries with various cost objects assignments in FI/CO. Being a CO consultant, it is expected to know objects assignments in FI/CO. Being a CO consultant, it is expected to know the FI-CO Integration points. This courseware will contain integration the FI-CO Integration points. This courseware will contain integration overview between FI-CO Componentsoverview between FI-CO Components

UseUseOn successful completion of this training, Associate will have fair idea on…..On successful completion of this training, Associate will have fair idea on…..

- The Integration points between FI & CO.- The Integration points between FI & CO.

Purpose and UsePurpose and Use


Internal Vs. external reporting: Internal Vs. external reporting:

Challenge to use different sub-modules in either finance or Challenge to use different sub-modules in either finance or controlling according to the reporting requirements (whether controlling according to the reporting requirements (whether external or internal)external or internal)

To align the organization structures in Finance and ControllingTo align the organization structures in Finance and Controlling

Few examples:Few examples:

•Whether all company codes should be tagged to one controlling Whether all company codes should be tagged to one controlling area or individual 1 company code :1 controlling areaarea or individual 1 company code :1 controlling area

•Whether profit center accounting in controlling should be chosen Whether profit center accounting in controlling should be chosen instead of business area in financial accounting.instead of business area in financial accounting.

•Determining functional area from either in cost center or GL Determining functional area from either in cost center or GL accounts posses an integration challengeaccounts posses an integration challenge

•To make sure that only relevant general ledger accounts are To make sure that only relevant general ledger accounts are created as cost elements to align finance and controlling reporting.created as cost elements to align finance and controlling reporting.

ChallengesChallenges



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COA

Co.Code

GL Accounts

Primary Cost.Elmnt

Thru Sec. Cost.Elemnt

CO Objects

CO Objects

Controlling

Co.Area

Co.Code Co.Code

FI-CO Flow Org. ElementsFI-CO Flow Org. Elements

Integration Point


Sales & Distribution:

Sales Order- Delivery

- Billing

Accounting Entry for goods movement

-Accounting Entry for Revenue & Accounts

Receivable

Accounting entries getting registered in -PCA-COPA getting updated for Revenues and COGS and PCA ->getting updated for revenues

Basic Flow And Integration Basic Flow And Integration Source Model (1/2)Source Model (1/2)

Finance:- AP / AR /GL

- Asset Accounting

Funds Management

Respective FI Entries

- Revenue & Cost posting in Cost center, Profit Center and CO-PA.

-Asset Creation internally is via Internals Order or Project systems which are Controlling entities

- Cost center and Profit center as organization entities linked to Fund Center

Basic Modules Links to Controlling Accounting in FI


Production Planning:- Production Order- Goods Issue and receipts

- Activity Confirmation

-Accounts for stocks, consumption and cost of goods manufactured

-Activity Confirmation is not considered as it happens only in CO Module

Production order is a Cost Object in controlling module

-PCA updated with consumption and stock entries and WIP during period end processing

-COPA / any other cost object is updated with variance on period end processing

-Activity confirmation transfers the cost from cost center to production order. This entries are recognized in profit center accounting

Materials Management:

Other Goods Issue like issues to cost center or scrapping

Normal consumption entries posted with the probability the GL accounts for accounting could be different

-Receiver objects are normally cost center or internal order & these entries are recognized in Profit center accounting.

Basic Flow And Integration Basic Flow And Integration Source Model (2/2)Source Model (2/2)

Basic Modules Links to Controlling Accounting in FI


CO Integration With FICO Integration With FIIn respect of General Ledger Accounts in Finance which are P &

L in Nature, a Cost Element is created in Controlling.

At the time of Document Entry in Finance, along with the General Ledger Account, a Controlling Object like Cost Centre / Internal Order..etc is being entered.

Thereby, data flows from Finance to Controlling Module.

Following slides shows the five basic integration points between Finance - Controlling…

They are….. - Default Account Assignments

- Additional Balance Sheet / P&L Accounts

- Open / Close Posting Periods

- Maintain Exchange Rates

- Maintain Field Status

- Fund Center Accounting


Automatic assignment occurs during postings in external accounting (within the FI, MM, or SD components) if we do not enter a CO account assignment objects like “cost center” “order” or “project” for a cost accounting relevant posting.

Below are the few examples where automatic postings are defined and used…..

- Discounts, exchange rate differences, and banking fees in FI

- Price differences and minor differences in MM

Following are the CO Assignments which are assigned to Primary cost elements….

- Cost Center

- Order

- Profit Center

Default Account AssignmentsDefault Account Assignments(OKB9)(OKB9)


Dummy Profit Center

If No profit center is specified in posting, then Dummy Profit center is used.

Profit Center Determination

In this section, Accounts or Range of accounts are assigned to a profit center for the flow of values.

Balance Sheet / P&L AccountsBalance Sheet / P&L Accounts

Profit Center Derivation

This is in addition to the above, we can derive profit center based on Co.Code, Account No, Business Area…etc.,


Open/Close Posting PeriodsOpen/Close Posting Periods

Assets (A)

Vendors (K)

Materials (M)

GL Accounts (S) Contracts (C)

Customers (D)

- Consultant can specify which periods to be open / close for posting of documents in Finance (Internally Controls' the Controlling postings as well)

- It is mandatory to maintain header entry (+) as a basic to make any postings.

- However standard SAP System provides 6 types of accounts if consultant wants to maintain them individually

- Consultant can specify “Period Lower Limit”, “Upper Limit” & “Fiscal Year” for the period in question…. Following are the type of accounts….


Basically, maintaining exchange rates are mandatory for plan and actual postings: Besides this, following are the few more situations…

Finance

o Translate foreign currency amounts on posting or clearing

o Determine the profit/loss on exchange rate differences

o Value open items in foreign currency

o Value foreign currency account balances

Controlling

o Determine the controlling area currency equivalents of amounts

posted in different company code currencies

o Allow project settlement to take account of different controlling

area, sender and receiver currencies.

Maintain Exchange RatesMaintain Exchange Rates

The currency translation rates are time-dependent and can be maintained either manually or through program


Maintain Field Status Maintain Field Status (Field Status Group)(Field Status Group)

FSV

Co.Code

Field Status

TransactionalFSG @ MD A/c Group

Field Status Group is the one which controls the document entry fields, whether they are allowed for entry or not.

If FSG is not maintained properly in customizing, some important CO Objects may be missed from being posted…which might cause serious accounting imbalances (SDRO)

S-Suppress D-Display R-Required O-Optional

Field Status Variant


Account AssignmentsAccount Assignments (Asset Accounting-(Asset Accounting-ACSETACSET))

Cost center specified for APC Values &

Depreciation Run



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Default Account AssignmentsDefault Account AssignmentsOKB9OKB9

IMG Path: Controlling – Cost Center Accounting-Actual Posting-Manual Actual Postings-Edit Automatic Account Assignment


Balance Sheet / P&L AccountsBalance Sheet / P&L Accounts(1/3)(1/3)

IMG Path: Controlling-Profit Center Accounting-Actual Posting-Choose Additional BS & P&L Accounts-Choose Accounts

If default Profit Center not specified, Dummy

PC is considered


Balance Sheet / P&L AccountsBalance Sheet / P&L Accounts…Contd(2/3)…Contd(2/3)

VAT Derivation BS Derivation


Balance Sheet / P&L AccountsBalance Sheet / P&L Accounts…Contd(3/3)…Contd(3/3)

Derivation for VAT accounts thru Plant

Derivation for BS accounts thru

Co.Code


Open/Close Posting PeriodsOpen/Close Posting PeriodsIMG Path: Financial Accounting Global Setting-Document-Posting Periods- Open/Close Posting Periods

Minimal Requirement for posting -“+ Header”


Maintain Exchange RatesMaintain Exchange RatesIMG Path: Enterprise Controlling-Consolidation-Data-Automatic Posting-Currency Translation-Exchange Rates-Maintain Exchange Rates

User can maintain both Direct –Indirect

Quotation


Maintain Field Status Maintain Field Status (Field Status Group)(Field Status Group)

IMG Path: Financial Accounting Global Settings–Document–Line Item–Controls– Define FSVariant


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CO integration with FICO integration with FI


Document Entry in FinanceDocument Entry in Finance……Doc. EntryDoc. Entry

Enter Order / Cost centre or any specified CO Assignment Object & POST.


Document Entry in FinanceDocument Entry in Finance.. .. Doc. NoDoc. No..

Posted document number is displayed


Document Entry in FinanceDocument Entry in Finance……DisplayDisplay

Enter the Document number, Company Code, Fiscal Year in T-Code FB03 & Press ENTER.

Once we display the document, Click on Accounting Doc. to

view the related Controlling Data


Document Entry in ControllingDocument Entry in Controlling…..…..

Order Number to which the Cost is booked is displayed

For every Finance Document posted, a corresponding For every Finance Document posted, a corresponding Controlling Document is generated, as displayed above.Controlling Document is generated, as displayed above.



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Points To RememberPoints To Remember

- Only General Ledger Accounts of Profit/Loss in nature are - Only General Ledger Accounts of Profit/Loss in nature are created as a Cost Element. (Exception to this rule is Balance created as a Cost Element. (Exception to this rule is Balance sheet Assets GL accounts can be created as statistical Cost sheet Assets GL accounts can be created as statistical Cost elements for budgetary control purposes)elements for budgetary control purposes)

- Validation & Substitution features used in finance will have - Validation & Substitution features used in finance will have effect in CO Objects derivation & Postings….effect in CO Objects derivation & Postings….

- It is important to know the objective behind reporting either in - It is important to know the objective behind reporting either in finance or controlling – In two comparative reports, all figures finance or controlling – In two comparative reports, all figures from finance may not tally with controlling. If this is by design from finance may not tally with controlling. If this is by design then we have an answer and if not then this should have been then we have an answer and if not then this should have been highlighted in the integration testing between these two highlighted in the integration testing between these two modulesmodules


Points To RememberPoints To Remember…..Contd…..Contd

- In New GL Accounting (Flexi Ledger), Profit center accounting - In New GL Accounting (Flexi Ledger), Profit center accounting is part of Finance rather Internal Accounting (Controlling)is part of Finance rather Internal Accounting (Controlling)

- Funds Management / Functional Areas- Funds Management / Functional Areas

- “Field Status Group” is another check point for any missing - “Field Status Group” is another check point for any missing Postings to CO Objects.Postings to CO Objects.

- OB52 – Open / Close posting periods.- OB52 – Open / Close posting periods.

- OB08 – Maintain Exchange Rates for foreign Currency - OB08 – Maintain Exchange Rates for foreign Currency Postings…Postings…

co fi integration

Documents

cost center order

cost center order

entities cost center

profit center india

cost of goods

dummy profit center

profit center derivation

revenues india sap coe