SAP FI – All About Financial Accounting and Transactions
Guys, if anyone of you is willing to know all about SAP FI –Financial Accounting and Transactions then go through this article. In any business, to make decision making and successful run of the enterprise, the key factors are to handle the financial transactions and generate financial reports. One of the essential modules of SAP is SAP FI (Financial Accounting) and this module deal in recording, processing, and maintain financial accounting transactions within the enterprises. All the data related to financial and business transactions are also handled and managed by SAP.
The system has the facility for tracking and reporting multiple companies in countries with different currencies. SAP FI module is suitable for both small and large companies and it is also very flexible.
In the market, SAP FI helps to get the real-time financial position of the company. It is a software that enables integration with SD (Sales & Distribution), MM (material management), purchasing, and also enables the user to drill down to the original transaction. The SAP FI is the part of SAP FICO i.e. system, applications, and products (financial accounting and controlling). For the entire system, FI is supporting a skeletal framework and all the financial impact of transactions in other modules post in FI.
SAP FI Advantages
Globally, SAP FI (Financial accounting) offers one of the most wide-ranging financial management solutions. With the help of SAP FICO, Company improves corporate performance. SAP FI enables you to quickly read, evaluate, and react to change business situations and come with efficient strategies. SAP system permits better transparency across the units and enhances corporate governance. SAP offers greater obedience to the central system, accounting standard and offers an enhanced administration of internal controls. SAP FI is also integrating with other SAP modules.
It also automates credit and collection management and it also provides bill generation, invoices, and payments electronically that improve functions of traditional account payable and accounts receivable. SAP FI has the better capability for managing cash across countries and locations. It also permits for reporting, allocating the cash in real-time, and also sets up in-house payment banks or centers.
Along with enhancing financial and managerial reporting, SAP offers flexibility for reporting performance as per the company, business unit, or cost center and also enhances the combination of finance and treasury process.
SAP FI Sub Modules
- General Ledger (FI-GL): In this sub-module complete financial accounting data record either automatically or manually via the integrated process. Business transactions with an impact on financial accounting are directly posted to the FI-GL submodule.
- Accounts Receivable (FI-AR):
All the events related to sales and records and transactions with customers are managed by it. All FI-AR posting records simultaneously in FI-GL (General Ledger). This sub-module closely combines SD and MM components.
- Accounts Payable (FI-AP): In this, the financial accounting transactions engage vendors that are recorded and administrate. SAP FI-AP combines with the components of MM (material management).
- Fixed Assets (Asset Accounting) (FI-AA): this is used to create and monitor the fixed assets.
- Special Purpose Ledger (FI-SL): In past times it was known as extended ledger because of its multiple applications feature. This is the finest tool to manage financial data in order to provide legal support. Special Purpose Ledger (FI-SL) offers many facilities like combining, modifying, summarizing, allocating, and planning the data.
- Funds Management (FI-FM): this sub-module supports control and financial checking by using budgeting techniques.
- Travel Management (FI-TM): it processes business trip and expense data and it can also integrate with HR.
Account receivable and account payable both are amalgamate with the general ledger with different components in the SD module.
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