Most Asked SAP FICO Interview Questions and Answers
For document clearing what are the customizing prerequisites ?
The customizing pre-requisite for document clearing is to check the items cleared and uncleared, and this is done by open item management. Open item management manages your outstanding account, i.e account payable and account receivable. For instance, an invoice item that has not yet been paid is recorded as open account until it is paid.
What is the importance of GR/IR ( Good Received/ Invoice Received) clearing account?
GR/IR ( Good Received/ Invoice Received) is an interim account. In the legacy system, if the goods are received and the invoice 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. Similarly, when an invoice is received the vendor account is credited, and the GR/IR account is debited, the GR/IR will show as an un-cleared items till the time the invoice is not received.
What is parallel and local currency in SAP?
Each company code can have two additional currencies, in addition to the company code, currency entered to the company code data. The currency entered in the company code creation is called local currency and the other two additional currencies are called parallel currencies. Parallel Currencies can be used in foreign business transactions. In order to do international transaction, parallel currency can be used. The two parallel currencies would be GROUP CURRENCY and HARD CURRENCY.
Where can you use the internal order?
To track the cost, internal orders are used; they are proposed to be incurred over on a short term basis.
Is it possible to calculate depreciation to the day?
Yes, it is possible to calculate depreciation, to do that you have to switch on the indicator Dep. to the day in the depreciation key configuration.
In Asset Accounting what is the organizational assignments?
In Asset Accounting, chart of depreciation is rated as the highest node, and this is assigned to the company node. All the depreciation calculations are stored under the chart of depreciation.
What is the importance of asset classes? What asset classes are there?
The asset class is the main class to classify assets. Every asset must be assigned to only one asset class. Example of asset class is Furniture & Fixtures, Plant & Machinery, and Computers etc. The asset class also contains G1 account, when any asset is procured, G1 account is debited. Whenever you create and asset master, it becomes mandatory to mention the assest class for which you are creating the required assets. So, whenever any asset transaction occurs, the G1 account attached to the asset class is automatically picked up and the entry is passed. You can also specify the default values for calculating the depreciation values and other master data in each asset class.
How capital WIP (Work In Process) and Assets accounted for in SAP?
‘Capital WIP’ is referred to as Assets under construction in SAP and is represented under specific asset class. Depreciation is not charged under ‘Capital WIP’ usually. The cost incurred on building a capital asset can be booked to an ‘internal order’ and through the settlement procedures, and can be posted onto an ‘Asset Under Construction’.
What are the major components of Chart of Accounts?
The major components of Chart of Accounts are:
a) Chart of account key
c) Maintain Language
d) Length GL account number
e) Controlling Integration
f) Consolidation-Group chart of accounts
g) Block indicator
What is credit control area in SAP?
To immune your company from the risk of bad debts and multiple outstanding receivable, you can set a credit limit for your customer by using credit control area in SAP. With the help of SAP, you can block the deliveries to your customer based on the credit limit and the accounts receivable balance in their account which is maintained by you.
How can you create Credit Control Area in SAP?
By using transaction code OB45 or path you can create Credit Control Area in SAP
SPRO> enterprise structure >maintain structure>definition>financial accounting>maintain credit control area and then enter the following description
b) Name of the credit control area in SAP
e) Credit Limit
f) Risk Category
g) Fiscal Variant
h) Rep group
What is posting period variants?
In fiscal year posting period is a period for which the transactions figures are updated. The posting period variants in SAP is accountable to control which accounting period is open for posting and ensures that the closed periods remain balanced.
Explain in simple terms what is field status and what does it control?
Field status group is a group configured in FSV (Field Status Variant) to maintain field status for G/L (General Ledger) accounts. It controls which field should suppress, display, optional and required.
What is short-end fiscal year?
A short-end fiscal year results when you change from a normal fiscal year to a non-calendar fiscal year, or other way around. This type of change happens when an enterprise becomes part of a new co-corporate group.
What is an account group and where it is used?
To control the data that needs to be entered at the time of the creation of a master record an account group is used. Account group exist for the definition of GL account, Customer Master and Vendor.