SAP -GL Interview questions

  1. 1.       Give some examples of GL accounts that should be posted automatically through the system and how is this defined in the system?

Stock and Consumption accounts are instances of GL accounts that should be automatically posted to. In the GL account master record, a check box exists wherein automatic posting option is selected called “Post Automatic only”.

  1. 2.       Where is a account group and where all is it used?

An account group controls the data that needs to be entered at the time of creation of a master record. Account groups exists for the definition of a GL account, Vendor and Customer master. It basically controls the fields which pop up during master data creation.

  1. 3.       What is a field status group?

Field status groups control the fields which come up when the user does the transactions. The options available is one can have the fields only for display or one can suppress it or make it mandatory. So there are three options basically. The field status group is stored in the FI GL Master.

  1. 4.       What is the purpose of a “Document Type” in SAP?

A document type is specified at the header level during transaction entry and serves the following purposes:

  • It defines the Number ranges of the document
  • It controls the type of accounts that can be posted at eg Assets, Vendor, Customer & Normal GL Account.
  • Document type to be used for reversal of entries
  • Document type can be used for Batch Input sessions
  1. 5.       What is a Financial Statement Version?

An FSV  is a reporting tool and can be used to depict the manner in which the final accounts like Profit and Loss account  and Balance sheet needs to be extracted from SAP. It is freely definable and multiple FSV’s can be defined for generating the output for various external agencies like Banks and other statutory authorities.

  1. 6.       How can Input and Output taxes taken care in SAP?

A tax procedure is defined for each country and tax codes are defined within this. There is flexibility to either expense out the Tax amounts or capitalize the same to stocks.

  1. 7.       What are Validations  and Substitutions?

Validations /Substitutions in SAP are defined for each functional are eg Assets , Controlling etc at the following levels,

  • Document level
  • Line item level

These need to be specifically activated and setting them up are complex and done only when it is really needed. Often help of the technical team is taken to do that.

  1. 8.       Is it possible to maintain Plant wise different GL codes?

The valuation group code should be activated. The valuation grouping code is maintained per plant and is configured in the MM module. Account codes should be maintained per valuation grouping code after doing the configuration.

  1. 9.       Is Business area at Company Code Level?

No. Business area is at client level. Which means other Company Codes can also post to the same Business area.

  1. 10.   What are the difference scenarios under which a Business Area or a Profit Center may be defined?

This question in usually very disputable. But both business areas and Profit centers are created for internal reporting. Each has its own pros and cons but many companies now a days go for Profit Center as there is a feeling that business area enhancements would not be supported by SAP in future versions.

There are typical month end procedures which need to be executed for both of them and many times reconciliation might become a big issue. A typical challenge in both of them is in cases where you do not know the Business area or Profit Center of the transaction at the time of posting.

  1. 11.   What are the problems faced when a Business area is configured?

The problem of splitting of account balance is more pertinent incase of Tax accounts.

  1. 12.   Is it possible to default certain values for particular fields? For e.g. Company Code.

Yes it is possible to default for certain fields where a parameter id is present. Go to the input field to which you want to make defaults. Press F1, and then click Technical info button, This opens a window that displays the corresponding parameter ID(if one has been allocated to the field) in the field data section. Enter this parameter ID using following path on SAP

Easy access screen system > User profile>Own data.

Click on parameter tab. Enter the parameter ID code and enter the value you require to default. Save the user Settings.

  1. 13.   Which is the default exchange rate type which is picked up for all SAP transactions?

The default exchange rate type picked up for all SAP transactions is M (Average type)

  1. 14.   Is it possible to configure the system to pick up a different exchange rate type for a particular transaction?

Yes it is possible. In the document type definition of GL, you need to attach a different exchange rate type.

  1. 15.   What are the Customizing prerequisites for document clearing?

Account must be managed on the open item management. This tick is there in the General Ledger Master Record called open Item Management. It helps you to manage your accounts in terms of cleared and uncleared items. A typical example would be GR/IR Account in SAP (Goods Received/Invoice Received Account).

  1. 16.   Explain the importance of the GR/IR clearing account.

GR/IR is an interim account. In legacy system if the goods are received and the invoices is not received the provision is made, in SAP at the Goods receipt it passes the accounting entry debiting the Inventory and Crediting the GR/IR Account. Subsequently when an invoice is recd this GR/IR account is debiting and the Vendor account is credited. That way till the time that the invoice is not received the GR/IR is shown as uncleared items.

  1. 17.   How many numbers of line items in one single entry you can have?

No of line items in one document you can accommodate is 999 Lines.

  1. 18.   In assignment field in the Document you get some reference, which comes from where?

This is on the basis of sort key entered in the master.

  1. 19.   How do you maintain the number range in Production environment? By creating in Production or by transport?

Number range is to be created in the production client. You can transport it also by way of request but creating in the production client is more advisable?

  1. 20.   In customizing “Company Code Productive” means what? What it denotes?

Once the Company code is live this check box helps prevent deletion of many programmes accidentally. This check box is activated just before go live.

“Company Code vs Controlling Area”

What’s the difference between Company Code and Controlling Area?

Company Code
It is the smallest organizational unit in FINANCIAL ACCOUNTING (FI) for which a complete set of accounts can be created. It is the central organizational unit of external accounting within the SAP system. Normally, a company code is created for each company (legal entity). It is a mandatory and pre-requisite that at least one company code must be defined before implementing the Financial Accounting component. All business transactions relevant for Financial Accounting are entered, saved and evaluated at company code level. Therefore, it is at company code level wherein a complete set of financial statements (Balance Sheet, Income Statement, Statement of Cash Flows) can be created.

Controlling Area
Controlling Area in SAP is an organization that represents a closed system used for cost accounting purposes. It is an organizational unit in the Controlling (Management Accounting) separate and has different functions with that of the Company Code. One ore more Company Codes can be assigned to a Controlling Area.

G/L ACCOUNTING (FI-G/L)

1.What is open item management?

Open item management means that a line item needs to be cleared against another open item. At a particular point, the balance of an account is the sum of all open items of that account. Generally, you make these settings in the G/L Master for all clearing accounts, such as a Goods receipts and Invoice receipts (GR IR) account, customer account, vendor account, or bank G/L account, or all accounts except the main bank account. Open item managed accounts always have line item management.You can switch open item management on and off through transaction code FS00.

2.What are the types of currencies?

The following currencies are used in SAP solutions:
■ Local currency—T his is company code currency, which is used for generating financial statements for external reporting. Sometimes it is called operating currency.
■ Group currency —Group currency is the currency that is specifi ed in the client table and used for consolidation purposes.
■ Hard currency —Hard currency is a country-specifi c second currency that is used in countries with high infl ation.
■ Index-based currency —Index-based currency is a country-specific fictitious currency that is required in some countries with high infl ation for external reporting (for example, tax returns).
■ Global company currency —Global company currency is the currency that is used
for an internal trading partner.

3.Are any FI documents created during purchase order (PO) creation? If
yes, what is the entry?

During PO creation (using transaction code ME21N), no FI document will be created. However, in CO, there can be a commitment posting to a cost center according to confi guration. The offsetting entry is posted at the time of GR.

4.There are many banks in a house bank. If a payment is to be made from a particular bank G/L account, how is it carried out?

There can be several accounts in one house bank. A house bank is represented by a house bank ID and a bank account is represented by an account ID. While creating the account ID, you are assigning a G/L account for outgoing payment. When making payment, you will select the house bank ID and account ID, which in turn determines from which G/L account payment will be disbursed.

5.What is the difference between Account Assignment Model (AAM), recurring entries, and sample documents?

AAM: A reference for document entry that provides default values for posting business transactions. An AAM can contain any number of G/L account itemsand can be changed or supplemented at any time . Unlike sample documents, the G/L account items for AAMs may be incomplete.
Recurring entries : A periodically recurring posting will be made by the recurring entry program on the basis of recurring entry original documents. The procedure is comparable to a standing order by which banks are authorized to debit rent payments, payment contributions, or loan repayments.

Sample documents : A sample document is a special type of reference document. Data from this document is used to create default entries on the accounting document entry screen. Unlike an accounting document, a sample document does not update transaction fi gures but merely serves as a data source for an accounting document.

6.In the G/L master you have the options Only balances in local crcy and Account currency. What do these mean?

Account currency is the currency assigned to the G/L account. If you decide that you want to maintain company code currency, then you can post a transaction in any currency in that account. If you want to maintain separate currency for that G/L, note that there will be a difference because of the conversion rate. Some G/L accounts can’t be maintained on an open item basis and can’t be in a foreign currency, such as clearing accounts or discount accounts, etc. In that case,you can specify Only balances in local crcy to show the balance in local currency.

7.How many charts of account can be attached to a company code?

A maximum of three charts of account can be assigned to a company code:

  •  operational COA
  • group COA
  • country COA.

8.What are substitutions and validations? What is the precedent?

Validations are used to check the presence of certain conditions. It returns a message if the prerequisite check condition is not met. Substitutions are similar to validations. They actually replace and fi ll the field with values behind the scenes without the user’s knowledge, unlike validations that create on-screen messages for the user.

9.What are special periods used for?

The special periods in a fi scal year variant can be used for posting audit or tax adjustments to a closed fi scal year. The logic behind the use of special periods is to identify and have control over transactions after the closing of normal posting periods.

10.What is a shortened fiscal year? When is it used?

A shortened fi scal year is a fi nancial year that has fewer than 12 normal posting periods. This type of fi nancial year is used for shifting an accounting period from one fi nancial period to another fi nancial period. For example, say Company X was following accounting period Apr xxxx to Mar xxxx+1, and has now decided to follow accounting period Jan xxxx to Dec xxxx. Now the current accounting period duration is only 9 months, i.e., from Apr xxxx to Dec xxxx, which is less than12 months. This type of fi scal year is called a shortened fi scal year.

11.What are posting periods?

A posting period is a period of time in which you are posting a transaction. It may be a month or a week. In the fi scal period confi guration, you defi ne how many posting period a company may have. A posting period controls both normal and special periods for each company code. It is possible to have a different posting period variant for each company code in the organization. The posting period is independent of the fiscal year variant.

12.What are document types and what are they used for?

Document type is nothing but types of vouchers containing line items. Several business transactions can be identifi ed within a particular document type. The document type controls:
■ Document number ranges
■ Header part of document
■ Line item level of the document
■ Filing of physical document

However, if SAP standard document types are not suffi cient, you can create your own using transaction code OBA7.

13.What is an employee’s tolerance group? Where is it used?

An employee’s tolerance group controls the amount that is to be posted. Tolerance groups are assigned to user IDs, which ensures that only authorized persons can make postings. By defining the employee’s tolerance group, you are restricting employees from entering certain transactions for which they are not authorized.This basically controls who is authorized for what amount.

An employee’s tolerance group limit controls:
■ Up to what amount per line item an employee can post
■ Up to what amount per document an employee can post
■ Allowable payment difference an employee can accept

14.How many FSVs can be assigned to the company code?

There is no such restriction of assignment of FSV to company codes. You can assign as many FSVs as you want to the company code.

15.What are recurring entries and why are they used?

Recurring entries (setup in FBD1 ) can eliminate the need for the manual posting of accounting documents
which do not change from month to month. For example, a regular rental expense document can be created which can be scheduled for the last day of each month. Usually multiple recurring entries are created together and then processed as a batch at month end using transaction F.14

16.Explain how foreign currency revaluation works in SAP R/3 FI

Over time the local currency equivalent of foreign currency amounts will fluctuate according to exchange rate
movements. Usually at month end, there is a requirement to restate these amounts using the prevailing month end exchange rates.
SAP can revalue foreign currency GL account balances as well as outstanding customer and vendor open item balances.
In SAP configuration, you define the balance sheet adjustment account and which accounts the realized gain/loss should be booked.
A batch input session is created to automatically post the required adjustments.

17.During GL account clearing how can small differences be dealt with ?

During configuration a tolerance limit is set which defines the maximum differences allowed during clearing.
The differences can be automatically booked by the system to a specific account during posting (using IMG transaction OBXZ)

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18.A general ledger master record contains …….TWO……….. segments