FI interview questions Phase two 1. What is document? How it is identified?

SAP is a table driven software and SAP FI is a module based on the principle of document. All the transactions performed in FI would result a document. A document is a result of a posting in accounting in SAP. There are actually two types of documents, original document and processing document. Every document consists of a document header and two or more line items. (OR) A business transaction can create one or more documents. Documents in R/3 include a doc header and 2-999 line items. A document remains a complete unit in the R/3 system until archived. Controlling info may also be included in doc header SAP records at least one doc for every biz transaction and each doc receives a unique doc number. Every Doc uniquely identified by following Fields: i. Doc No ii. Company Code iii. Fiscal Year Two important control keys for documents are: o Document Type (to control document header) o Posting Keys (for line items) Doc Type controls the doc header & is used to classify the business transactions to be posted, it is the key to differentiate and classify business transactions. 2. What is the document header? What is the table name of document header?(is called BKPF) The document header contains data that applies to the entire document. To enter a document, you must first enter the document header. The following entries are required: y Document date The document date is the date the business transaction (such as a transfer posting, or the issue date of an invoice or payment) took place. The document date can be different from the posting date, which is the date that G/L account balances or the customer/vendor balances are updated. y Document type For some document types, you also have to make entries in the fields Reference and Document header text. y Document number Depending on the document type, document numbers are either internally assigned by the system or entered by you externally. y Company code The system defaults this company code in all subsequent documents you enter that day. y Posting date Odaiah Pelley Page 1

The system automatically defaults the current date as the document date. When you post the document however, you can enter any other date (past or future) from a permitted posting period. The posting date can be different to the document entry date and the document date (date the original document was created). The posting date determines the posting period. Period The periods that are permitted for posting are determined by your system configuration. You can also post to periods in a previous fiscal year. If you do this, the carry forward balance for the current year is automatically corrected in special periods. Currency/Exchange rate When you enter the first document of the day, you must enter a currency key. The system defaults this currency key in all subsequent documents entered on that day. You have the following options when entering an exchange rate in a document header: o Enter the currency key. The system automatically transfers the exchange rate valid on the posting date. The exchange rate must be defined in the system. or o Enter the currency key and the translation date required. The system transfers the exchange rate valid on the translation date. The exchange rate must be defined in the system. or o Enter the currency key and the exchange rate manually in the document header. Trading partner business area This entry is then defaulted in each G/L account item that is not generated automatically. It can however be overwritten if required. Other document header fields o Doc.header text The document header text contains explanations or notes that are applicable to the whole document, not just specific document line items. o Reference number The reference number could be the number of an invoice, for example. o Cross-company code no. Either you enter the number of a cross-company code document manually, or it is determined by the system.

3. What is the control key of document header? Two important control keys for documents are: o Document Type (to control document header) o Posting Keys (for line items) Doc Type controls the doc header & is used to classify the business transactions to be posted, it is the key to differentiate and classify business transactions. Most imp control functions of doc types are: i. Number ranges for doc numbers ii. Account types permitted for postings Doc Types defined at client level and valid for all company codes. It controls the following: i. which accounts to be posted ii. Number range Odaiah Pelley Page 2

iii. Field status of document header text and reference iv. Whether invoices are posted with net procedure. 4. What is the line item? How it is controlled? All the information relating to account number, amount, debit/credit, tax code etc. are maintained in a line item. A single document can have up to 999 line items. Apart from the line items created by human the system also can create its own line items called system generated line items. The main point to be kept in mind is that, whatever be entered in line item, the grand total should always be zero, i.e., total credit should always equal total credit. Otherwise the system would not allow posting the document. How it is controlled: The entry of line item is controlled by a 2 digit alphanumeric key called a posting key. A posting key also determines the following facts, Which side of account the entry can be posted to, either the debit side or the credit side? The layout of a particular screen to be used for a particular transaction. Sap comes with many predefined posting keys: 40(GL debit), 50(GL credit), 01(customer credit memo), 21(vendor credit memo) etc. 5. What is the line item table of document? BUZEI 6. What is the report to run the compact document journal? Ans: RFBELJ00 7. How can you find documents in the system (what is the report for it)? Ans: RFBUEB00and RFBUEB01 8. What is document type? Ans: Document type controls the document header and is used to differentiate the business transaction to be posted. Document types are defined at client level and are therefore valid for all company codes. Document type defines - Number ranges for document number - Account types permitted for postings - The field status of the document header fields Document Header Text" and Reference Number" - Whether invoices are posted with the net procedure.

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9. What are the document types in SD? FI-SD related Document Types: 'RV' SD Invoice Postings of Sales Invoice from SD transactions. A Sales Order and delivery need to be completed before Sales Invoice is created in SD. 'RW' SD Invoice-Interco. Postings of Intercompany Invoice from SD transactions. A Stock Transport Order (STO) and delivery need to be completed before Sales Invoice is created in SD. 'RC' SD Credit Memo Postings of Credit Memo from SD transactions. A Credit Memo Request (a special Sales Order Type) need to be raised before Credit Memo is created in SD. 'RD' SD Debit Memo Postings of Debit Memo from SD transactions. A Debit Memo Request (a special Sales Order Type) need to be raised before Debit Memo is created in SD. 'RR' SD Credit for Return Postings of Credit Memo from SD transactions as arose from Return. A Return Order (a special Sales Order Type) and return delivery need to be completed before Credit Memo for Return is created in SD. 'RS' SD Rebate Credit Memo Postings of Rebate Credit Memo from SD transactions. A Credit Memo Request (a special Sales Order Type) need to be raised before Rebate Credit Memo is created in SD.

10. What are the document types in MM? FI-MM related Document Types: 'PR' Price Change Postings on Inventory Revaluation from MM (transaction MR21). 'Price Change' refers to the change in Standard Price of the material, not the price difference between PO and Invoice that is booked at the time of invoicing. Note this type of transaction does not have Reversal FI

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Document Type. If the price changed need to be adjusted, a new transaction is posted, rather than reverse the original posting. 'RE' Invoice Receipt Postings on Invoice Receipt transactions from MM (transactions MIRO/ MRRL) 'RI' Invoice Receipt-Interco. Postings on Invoice Receipt transactions for Invoice Verification triggered from Intercompany Sales. The Invoice Verification step for intercompany sales are triggered by SAP in form of a batch generated automatically. 'WA' Goods Issue Postings on Goods Issues or MM Transfer Postings. 'WE' Goods Receipts Postings on Goods Receipts with reference to Purchase Order or Production Orders. 'WI' Inventory Document Postings on Physical Inventory Differences. 'WL' Goods Issue/ Delivery Postings on Goods Issues with reference to SD Delivery. 11. Difference between Internal number assignment and external number assignment? Internal numbering means the R/3 system assigns the next available sequential number to the master data object or transaction posting. External means the user has to manually enter the number during the creation of the master record or the posting of the document. Entering the document number manually on each SAP financial posting is a time consuming effort and causes a risk to those transactions booked via interfaces. Often organizations want to do this to match source or legacy systems data with R/3. However there are plenty of text and reference fields available to store this information without requiring external numbering. 12. What is posting key? At what level we defined it? Defined at Client level and most imp con functions for a posting key are; i. Determine which account type can be posted to ii. Side of account (debit or credit posting) iii. Field status of additional details or layout of entry screen Odaiah Pelley Page 5

iv. Specifies whether the line item is connected to a payment transaction or not,(helps analyzing payment history/notices) v. Whether posting is sales relevant and sales figures need to be updated. Standard posting keys for customer/vendor invoices are i. Credit- 50 customer 31 Vendor ii. Debit- 01 customer 40 Vendor Standard posting keys for G/L account postings are; i. 40 Debit posting key ii. 50 Credit, posting Key 13. What is the field status variant? You have to define field status outside of the master record. Mark the field status you need for each field or field group under a field status group. Then assign the field status group to individual G/L accounts in the G/L account master records. Field status groups are independent of company code, attaching instead to the field status variant. A separate variant exists in each company code for field status groups in the standard delivered system. The variant name is the same as the company code, and each company code is assigned to this variant. You can work with the same field status groups in more than one company code, as outlined below: 1. Maintain field status variant 2. Assign company code to field status variant 14. What is the field Status Group? Field Status of document fields is influenced by Field status group and posting key and is determined by three factors: i. Account type (S,K,D) ii. Field status of posting key iii. Field status of account. As a general rule the account specific field status for G/L accounts Field status with highest priority applies, Exceptions to this rule are:     An activated biz area must be ready for input. Entries in tax fields only possible if G/L account is tax relevant. Field Status group controls the field display during document entry. For each group of G/L accounts you have to define the status of every document entry field. (Required/optional/hidden). Page 6

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 You assign field status groups to the respective G/L accounts in the G/L account master records. Each G/L account has a field status group. If a doc is posted to a sub ledger account the field status group of the reconciliation account is used. All the field status groups are summarized in one field status variant which is assigned to coy codes (mandatory) Required, hidden, optional is priority. Hide + Required=Error By changing the field status definitions of posting keys and field status group, the field status can be made transaction dependent and account dependent. Sub ledgers dont have field status group and therefore a lot of posting keys are used. In G/L postings differentiation is mainly made via different field status groups, therefore only two posting keys: 40 & 50 are needed for G/L postings.

15. What is the priority if posting key and filed status group is assigned to G/L account? Posting key defines: a. whether the line item is a debit or credit b. to which type of account the amount should be posted to(ex: when you use posting key 40, you will be able to post to GL accounts. When you use posting key 01, you will be only able to post to customer account. c. document screen layout during posting of a document. (which fields to appear in a document...double click on the posting key and select field status and make the entries as required /optional etc.) Field status group defines: Document screen layout during posting of a document. (which fields to appear in a document...double click on the field status group and select fields and make the entries as required /optional etc.) LOGIC: you assign field status variant to the company code, FSV is a bundle of field status groups. Ex: in FSG G001 you have made the text as required entry...you assigned the field status group g001 to cash account. So when you use cash account and try to post a document it will definitely prompt you to enter the text (text made as required.) Both FSG and PK control the same fields in a document. There is no dominance between FSG and Posting keys. But we should know the allowed combinations....

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If text is made required in PK and suppressed in FSG... the system will issue an error message. Rules for PK...and FSG....is set incorrectly for SGTXT field. Permissible combinations: PK R/S O/S R/o R S O FSG S/R S/O o/r R S O Result e SD RD NP NP NP R = required s = suppressed e = error SD = Suppressed dominates Rd = required dominates np = no problem. 16. Posting period is assigned to? Ans: Company Code 17. A posting period variant must contain at least one line with the entry? Ans: Valid for all accounts 18. The account range in the posting period variant consists of? Ans: G/L accounts. 19. Posting periods are opened and closed automatically. Ans: The posting period variant that contains the open periods has to be maintained manually. 20. No more than two periods can be open at the same time. Ans: As many periods as required can be open simultaneously. However, only two period intervals can be open at the same time. 21. The authorization group in the posting period variant applies only to authorization for posting in special periods. Ans: The authorization group applies to the first period interval. This can also be an interval with normal postings periods 22. What is open and close posting periods? IMG: FI.A/cing> F.A.Global settings>Document>Posting Periods> Open and close posting periods. 1) Several Company codes can use same posting period variant. 2) The SAP system automatically determines the posting period and fiscal year based on the posting date entered. (Only special period needs to be manually changed) Odaiah Pelley Page 8

3) The posting period variant is assigned to the company code. In this activity you specify for each variant which posting periods are open for posting. Two intervals are available for doing this (period 1 and period 2). For every interval, enter a lower period limit, an upper period limit and the fiscal year. You close periods by selecting the period specifications so that the periods to be closed are no longer contained. You can also assign authorization groups for permitted posting periods. This means that, for example, some posting periods can only be opened for particular users within monthly or annual closing. You can only assign the authorization group at document header level and it only affects period 1. The authorization object is called F_BKPF_BUP (Accounting document: Authorizations for posting periods). Read the corresponding chapter on User maintenance in the Assigning authorizations topic. Note You specify G/L account numbers for your specifications. You determine the posting periods allowed for the sub ledger accounts via the corresponding reconciliation accounts. To do this, you specify the sub ledger account type, such as D or K, and the corresponding reconciliation account. Caution There must be at least one entry for each variant. This entry must have + in column A; the columns From acct and To account may not be filled. In the columns for the posting periods, you specify the periods which are to be opened for the variant. Via further entries, you determine more specifically which periods are to be opened for which accounts. 23. How to define default values? Ans: Parameter IDs allow users to set default values for fields whose value does not change very often. For example, company code, currency. When you execute the transaction, these values appear in the corresponding fields automatically. 24. How to configure user-specific default values? Ans: Using editing options, you can configure your screens - Document entry -Document display -Open items

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25. How to determine default values in the system and the configuration? When you are creating Vendor Account, if you enter vendor number other details are automatically shows up which are called default values in the system. 26. How to activate value date proposal? IMG: Financial Accounting-->FAGS-->Document-->Default Values for Document Processing-->Default Value Date 27. What are document change rules? Doc change rules can be either user defined or predefined by the system only certain fields are modifiable once a doc is posted In case of Header: reference no and Doc header text modifiable only if posting period is not closed In case of Line items, amount, posting keys and account numbers are un modifiable. The other are fixed in IMG Conditions for doc field changes a. posting period must be open b. Line item is not cleared c. Line item either debit in customer or credit in vendor d. doc not a credit memo for invoice e. doc not a credit memo for down payment Document change rules can be made on following criteria: a. Account type: A, K, D, M, S b. Transaction class: e.g. special G/L (down payment) c. Company Code 28. Name the two possible ways to reverse a document in my SAP ERP financials Ans: Normal reversal posting and Reversal by negative posting 29. What are the two prerequisites that must be fulfilled in order to process negative postings? Ans: 1. The company code must allow negative postings. 2. The reversal reason must be defined for negative reversal. 30. What do you mean by terms of payment? Ans: The terms of payment are used to define - Baseline date for due date calculation Odaiah Pelley Page 10

- Cash discount periods - Cash discount percentage rates. The terms of payments are assigned to - Customer/Vendor master record - Defaulted by the system or entered by user - Used in transaction line items to determine payment conditions 31. How do you block the Payment? What are the control keys to block payment? Ans: Block keys and Payment method 32. What is Accounts Receivable? The Accounts Receivable application component records and administers accounting data of all customers. It is also an integral part of sales management. All postings in Accounts Receivable are also recorded directly in the General Ledger. Different G/L accounts are updated depending on the transaction involved (for example, receivables, down payments, and bills of exchange). The system contains a range of tools that you can use to monitor open items, such as account analyses, alarm reports, due date lists, and a flexible dunning program. The correspondence linked to these tools can be individually formulated to suit your requirements. This is also the case for payment notices, balance confirmations, account statements, and interest calculations. Incoming payments can be assigned to due receivables using user-friendly screen functions or by electronic means such as EDI and data telecommunication. (OR) Customer Master Records in SAP Accounts Receivable represent the subsidiary ledger that supports the balance sheet accounts for Accounts Receivable, Deposits Payable, and Unearned Income. Individual customer master records are referred to as customer accounts and represent the amount owed by the customer (in the case of accounts receivable) or the amount of deposit paid by a customer. These funds also include money that will be returned or amounts of money paid in advance. 33. What is Sales cycle? The sales cycle is the sequence of phases that a typical customer goes through when deciding to buy something. As a rule, the sales cycle is described from the customer's perspective. The first phase of the sales cycle may be either the customer's perception of a product, or a perception of a need that the product might satisfy. The following steps include research and evaluation; the last step is the customer's decision to purchase the product. 1. What are the five steps in the Sales Cycle and what Modules do they originate from?
y y y

Sales Order : SD Module Deliver Note : SD Module Goods Issue : MM Module Page 11

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y y

Billing Document : SD Module Receive Payment: FI Module

2. Of the five steps listed above, which ones generate accounting documents and what are they?
y y y

Goods Issue: Debit COGS and Credit Inventory Billing Document: Debit Accounts Receivable and Credit Sales/Revenue Payment Receipt: Debit Cash and Credit Accounts Receivable

3. What are all the activities in the Sales Cycle? Inquiries, Quotations, Sales Order, Delivery Processing, Goods Issue Processing, Billing Document Processing, Incoming Payment Processing, Automated General Ledger Update 4. What is an Inquiry in the Sales Cycle?

An Inquiry is a document created in the Sales & Distribution module that represents a query from a customer or prospective customer. 5. What is a Quotation?

A Quotation is a document created in the Sales & Distribution module that records information about materials possibly desired by a customer or prospective customer. The material number, price and alternative items is usually included on a quotation. 6. What is a Sales Order?

A Sales Order is a contractual agreement between a Sales Organization and a customer concerning goods to be delivered or services rendered. 7. When a Sales Order is processed, the system automatically executes what functions?

The system automatically executes:

y y y y y

Credit Checking Pricing Material Availability Checking Transfer requirements to Materials Requirements Planning (MRP) Shipping Point and Route Determination

8.

What is a Delivery Note?

The Delivery Note is a document created in the Sales & Distribution module that initiates the shipping activities associated with delivering materials to a customer

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9.

What financial transaction occurs when the Delivery Note is processed?

A Delivery Note does not create a financial transaction in the General Ledger. 10. What is the purpose of a Goods Issue?

A Goods Issue is a document posted in the Materials Management module that is used as the source document for recording changes in stock levels associated with delivering materials to customers and for recording the financial impact of such transactions in the General Ledger. 11. What is a Billing Document?

A Billing Document is a document posted in the Sales & Distribution module, which supports the creation of Customer Invoices, Credit or Debit Memos, and the recording of the financial impact of these transactions in the General Ledger. 12. What accounting transaction occurs when a Billing Document is posted?

As a result of a Billing Document, integration to the Financial Accounting module occurs with the automatic creation of an Accounting Document containing the following accounting entries:
y y

Debit to the Customer Account and the appropriate General Ledger Reconciliation Account assigned to it. Credit to the appropriate General Ledger Revenue Account.

34. What is Purchase cycle? (OR) Procurement Cycle? 1. 2. Name the five major activities (in the order they occur) in the Procurement Cycle. Purchase Requisition (MM) Purchase Order (MM) Goods Receipt (MM) Invoice Verification (MM) Vendor Payment (FI) What is a Purchase Requisition?

A Purchase Requisition is a document that identifies an organizations demand for a product or service from an outside vendor. It is an internal document (i.e., it is not visible to the vendor or any other outside organization). 3. What are the two ways a Purchase Requisition can be created? Automatically as a result of a Materials Requirements Planning (MRP) run. Manually by a user. Page 13

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4.

What is a Purchase Order?

A Purchase Order is a legal contract between a buyer and a vendor. It lists the materials or services to be purchased on specified terms and conditions (quantity, price / pricing conditions, delivery date). 5. 6. Name the four steps necessary for creation of a Purchase Order. Source Determination Vendor Selection Purchase Order Processing Purchase Order Follow-Up What are the different types of goods movements?

Goods receipts, goods issues, and transfer postings. 7. What is Invoice Verification?

Invoice verification is the process of matching Vendor Invoices to the Purchase Order and Goods Receipt documents. For matched vendor invoices, a payable is automatically created in the FI General Ledger. 8. How is the Payment Program used to make Vendor Payments?

The Payment Program is set to maximize cash discounts when paying open vendor items. It creates a list of proposed vendor items to be paid and suggests payment methods for each proposed payment. The user has the ability to make any changes before payments are made. Note: The payment program selection strategy (e.g., maximization of cash discounts) is configurable. 9. 10. Name the three different types of Materials Management documents. Order documents Goods receipt documents Invoice Receipt documents From which modules can the above documents be viewed?

Order documents can be viewed only in Materials Management. Goods and Invoice Receipt documents can be viewed from both Materials Management and Financial Accounting modules.

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11.

What is a Request for Quotation (RFQ)?

A RFQ is a request of quotes from vendors for a particular good or service. An RFQ can be created with reference to a Purchase Requisition or be created directly. 12. How is a Purchase Order created in SAP?

A Purchase Order (PO) can be created directly or with reference to a RFQ, a Contract, a Purchase Requisition, or another Purchase Order. 13. What is an Outline Agreement?

An Outline Agreement documents a long-term arrangement with a vendor to provide materials or services at an agreed price. It is valid for a period of time or until a pre-defined total quantity or total value is reached. 14. What are the different types of Outline Agreements?

Ans: Contracts and Scheduling Agreements (A Scheduling Agreement is fulfilled when the customer places deliveries against it in the agreement period. Thus, scheduling agreements do not have orders placed against them. Instead, if the function is run on the same day as one of the deliveries is due, and then it is used to directly create a delivery. After the delivery is created, the quantity in the scheduling agreement is correspondingly reduced). If the customer cannot supply specific delivery dates for the product, then it is preferable to use quantity contract, and refer orders to this contract when they are created. To create a scheduling agreement, use the following path: Logistics > Sales and Distribution > Sales > Scheduling Agreement > create (Transaction Code: VA31) 15. For what is an Account Assignment Category used?

Account Assignment category is used to manually create Order documents. It determines which account assignment data is required for an item in order to allocate costs. 16. What is the purpose of a Goods Receipt document?

A Goods Receipt document is created when goods are received at a plant/warehouse. At this time, an accounting document is created to make a General Ledger entry, and a materials document is created to record changes in physical inventory.

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17.

What is the purpose of an Invoice Receipt document?

When invoices are received from a Vendor, an Invoice Receipt document is created in the system. This document can be linked to a Purchase Order, a Goods Receipt, a Delivery Note, or a Vendor. In addition to the materials document, an accounting document is created, which updates the relevant Vendor Account (sub-ledger) and General Ledger Accounts.

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