Financial Accounting (FI) + Controlling (CO)
When running a company, “keeping the books” means using systematic procedures to record the company’s financial actions and to compile summaries of those activities. This information is compiled for use in the preparation of financial statements.
However, accounting contains much more than just keeping financial records; it also includes areas such as system design, control implementation, and analysis and verification.
Financial Accounting (FI) : Financial analysis, reporting, and bookkeeping procedures, both internally and externally. To put it simply, accounting is the universal language of finance.
Controlling (CO) : The cost of running a business should be planned, reported on, and monitored.
SAP FI : Used for Internal & external reporting while SAP CO used for internal reporting only.
Bookkeeping
The core purpose of bookkeeping are,
- Recording the monetary consequences and other pertinent data of the entity’s diverse transactions and other activities, and
- Producing a steady stream of paperwork and electronic outputs necessary for the firm to function on a day-to-day basis.
Transactions
Whether it’s the actual buying and selling of goods and services, the sending and receiving of money, or just an agreement to do business in the future, there are many different kinds of transactions that can take place.
A financial transaction is an event that has an impact on the monetary value of an asset, a liability, or the owner’s equity of a firm and causes it to change. This can occur when an asset is sold, a liability is paid off, or the owner’s equity is increased or decreased.
When using an accounting system, transactions are “posted” to the general ledger. A route map will help you record all those general ledger transactions. It’s called a chart of accounts.
A company’s chart of accounts is the blueprint it uses to structure its accounting practises and recordkeeping. After all, a transaction cannot be recorded without a proper location being identified. This chart is essentially a list of all the accounts that an organisation maintains, in a certain order, with brief descriptions of each account that include the account type and the transactions that should be posted to that account. Based on the specifics of the business and how it operates, each company develops its own chart of accounts.
Organizing the accounts, Connecting the chart of accounts to financial statements
In order to learn SAP Financial Accounting Modules, You Should learn…
- General Ledger Accounting
- Accounts Receivable
- Accounts Payables
- Asset Accounting
- Bank Accounting
- Special Ledger (SL)
- Financial Closing
SAP Controlling ( Simply costs) – Subcomponents are
Managing and setting master data includes cost elements, cost centers, profit centers, internal orders, functional areas, designing product costing methods, Material overheads, Production Overheads, Sales Overhead, routings etc.
- Cost Center Accounting
- Cost Element Accounting
- Profit Center Accounting
- Internal Orders
- Profitability Analysis
- Product Cost Controlling
- Activity Based Costing
