SAP FICO

S/4 HANA

BY,
DEEPA G

SAP FICO
HENRY HARVIN INTERNSHIP

TOPIC NO. 1
“ENTERPRISE STRUCTURE”
 INDEX

SL. PAGE
CONTENTS
NO NO.

1 Introduction To Enterprise Structure 1

2 Define Company 2

3 Define Company Code 4

Define New Company in SAP by Copying

4 6
Existing Company Code

5 Assign Company Code to Company 8

6 Define Business Area 9

7 Define Functional Area 10

8 Define Credit Control Area 11

9 Assign Credit Control Area to Company Code 13

10 Define Segments 14

11 Define Financial Management Area 15

12 Summary Table Of Enterprise Structure 16

- DEEPA G
 ENTERPRISE STRUCTURE

INTRODUCTION
Enterprise structure is the organization structure as represented in SAP
system. Enterprise structure is the basis for the configuration of other parameters.
It’s primarily defined with three primary domain areas. They are:

 Finance & Controlling

 Sales and Distribution
 Logistics

ENTERPRISE STRUCTURE CONFIGURATIONS

1. Define Company
2. Define Company Code
3. Define New Company in SAP by Copying Existing Company Code
4. Assign Company Code to Company
5. Define Business Area
6. Define Functional Area
7. Define Credit Control Area
8. Assign Credit Control Area to Company Code
9. Define Segments
10. Define Financial Management Area

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  DEFINE COMPANY

MEANING OF A COMPANY IN SAP FICO

A Company is the smallest organizational unit. It can include either one or more
company codes. The Definition of Company in SAP is optional. A Company is an
independent organizational element which is required to consolidate two are more
company codes data at country level or segment level or continental level. Under Group
Company, we generate consolidated financial statements as per requirements of an
organization.

Example: Tata Group, Reliance Group etc.

STEPS TO DEFINE A COMPANY

We can Define a Company in SAP FICO by using:

• Navigation Path: SPRO – SAP Reference IMG – Enterprise Structure – Definition –

Financial Accounting – Define Company
• Transaction Code: OX15

Step 1: Enter Transaction code “OX15” in the SAP command field as shown below image
and enter to continue.

Step 2: On change view “Internal trading partners”: overview screen, click on “New
Entries” button to define company in SAP.

Step 3: On “New Entries screen, update the following details.

• Company: Enter a key that identifies company group in SAP. In our case we have
updated “DEEPA” for creation of new company.
• Company Name: In this field you need to updated full descriptive name of
company.
• Name of company 2: If second name of company available, update here or keep it
as blank.

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In Detailed Information section, update the following details:

• Street: Enter street name of company located

• Postal code: Enter postal pin code
• City: Update city name, in our case we have updated “Bangalore”
• Country: Here you need to updated country key.
Example: For India – IN, For United State – US, etc.
• Language key: By default, our language is English, so language key is “EN”
• Currency: Enter currency key in which transactions are being maintained for the
group company. It is called as home currency or local currency

DEEPA
DEEPA GROUP OF COMPANIES

Step 4: After updating all the required details, click on save button to save the company
details. Now you are prompted for customizing request, click on new entries button to
create new customizing request and update description of customizing request and press
enter to continue.

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  DEFINE COMPANY CODE

MEANING OF COMPANY CODE IN SAP FICO

A Company Code is a smallest organizational unit used to represent the company

for external accounting. Independent company can be created with one company code in
the SAP System. The Company Code definition is mandatory. At least one company code
must be defined before implementing the Financial Accounting component. A Company
Code could be separate, but not independent, commercial place of work.

STEPS TO DEFINE COMPANY CODE

We can Define a Company Code in SAP by using:

• Navigation Path: SPRO – IMG – Enterprise Structure – Definition – Financial

Accounting – Edit Copy, Delete, Check company code
• Transaction Code: OX02

Step 1: Enter transaction code “OX02” in the SAP command field and enter to continue.

Step 2: On change view “Company Code”: Overview screen, displays with the list of
company codes with their names. Click on “New Entries” button to create new company
code as per organizational requirements.

Step 3: On new entries company code screen, update the following details.

• Company code: Enter 4 digits’ alphanumeric code that identifies company in SAP
• Company name: Update the name of the company
• City: Enter the name of city in which the company is located.
• Country: Enter the name of country. Press F4 for possible entries and you can
select the code from the list.
• Currency: This currency is also called as home currency or local currency.
• Language: Our default language key: English (EN).

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 DEEP
DEEPA LTD.

Step 4: After updating all the required details, click on save button to save the configured
data. Now the system prompts the another screen to update the full address of company.
Update all the required address details of company and press enter to save the data.

DEEPA LTD.

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  CREATION OF NEW COMPANY BY COPYING EXISTING COMPANY CODE

We can create a new company by copying from existing company code

already created in SAP systems.

STEPS TO CREATE NEW COMPANY BY COPYING EXISTING COMPANY CODE

We can create new company in SAP by using:

• Navigation Path: SPRO – IMG – Enterprise Structure – Definition – Financial

Accounting – Edit Copy, Delete, Check Company Code –Copy Delete Check
Company Code
• Transaction Code: EC01

Step 1: Enter transaction code “EC01” in the SAP command field and enter to continue.

EC01

Step 2: Choose the first option “Copy Delete Check Company Code” and Execute it.

Step 3: Select “Copy” Icon & fill Company Code & Press Enter.

1000
DEEP

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Step 4: Click on the “YES” button to continue. Here, Copied all the general and global
settings of existing company code “1000” to new company code “DEEP”.

Step 5: We can see now in below screen Company Code copied from 1000 to DEEP.

Company Code 1000 copied to DEEP

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  ASSIGN COMPANY CODE TO COMPANY

After successful creation of company code and company in SAP, we need to

assign company code company in SAP system.

MEANING OF ASSIGNMENT IN SAP FICO

The link between company and company code in SAP is established through an
assignment of company code to company.

STEPS TO ASSIGN COMPANY CODE TO COMPANY

We can assign by company code to a company by using:

• Navigation Path: SPRO – IMG – Enterprise Structure – Assignment – Financial

Accounting – Assign Company Code to Company
• Transaction Code: OX16

Step 1: Enter Transaction code “OX16” in the SAP command field and press enter to
continue.

Step 2: On change view “Assign company code -> Company”: Overview screen, click on
position button and give your company code key. Now your company code displays at the
window and Now update your company key “DEEPA” in the given field.

DEEP DEEPA LTD. DEEPA

Step 3: After assignment of company code to company, click on save button and save the
configured data.

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  DEFINE BUSINESS AREA

MEANING OF BUSINESS AREA IN SAP FICO

Business Area in SAP is an organizational unit within accounting that can be

classified as geographical wise or product wise as per the requirements of an organization.
The definition of business area in SAP is optional. Business areas are used in external
segment reporting based on the product lines, branches of a company. Movements value
entered in Financial Accounting are assigned to business areas.

STEPS TO DEFINE BUSINESS AREA

We can define business area by using:

• Navigation Path: SPRO – IMG – Enterprise Structure – Definition – Financial

Accounting – Define Business Area
• Transaction Code: OX03

Step 1: Enter transaction code “OX03” in the SAP command field and enter to continue.

OX03

Step 2: On change view “Business areas”: Overview screen, click on “New Entries” button
to create new business areas as per the requirements of company.

On new entries of business areas screen, update the following details:

• Business Area: Give the four digits’ key that identifies that business area in SAP.
• Description: Update the descriptive text of business area.

Step 3: After updating the details, click on save button to save the configured business
areas data.

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  DEFINE FUNCTIONAL AREA

MEANING OF FUNCTIONAL AREA IN SAP FICO

Functional Area is an organizational unit that sorts operating expenses incurred

based on the activities. If the organization is following cost of sales accounting, it is
mandatory to create functional area in SAP and properly assign in various master data.
Each transaction is recorded with a functional area and is used in reporting to classify
expenses.

Example: Production, Administration, Sales, Research & Development, etc.

STEPS TO DEFINE FUNCTIONAL AREA

We can define functional area by using:

• Navigation Path: SPRO – IMG – Enterprise Structure – Definition – Financial

Accounting – Define Functional Area
• Transaction Code: FM_FUNCTION

Step 1: Enter transaction code “FM_FUNCTION” in the sap command field and enter to
continue.

Step 2: From process functional area screen, enter the four digits’ key that identities
functional area in SAP and click on create functional area button to define the functional
areas as per the organizational requirements.

Step 3: Now update description of functional area and click on save button and save the
configured functional area details.

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  DEFINE CREDIT CONTROL AREA

MEANING OF CREDIT CONTROL AREA IN SAP FICO

Credit Control Area in SAP is an organizational element that controls and monitors
credit limits of customers. A Credit Control Area can consist one or more company codes,
but you cannot assign company code to more than one credit control area in SAP. It is
used for credit management in Accounts Receivable (FI-AR) and Sales and Distribution
(SD).

STEPS TO DEFINE CREDIT CONTROL AREA

We can define credit control area by using:

• Navigation Path: SPRO – IMG – Enterprise Structure – Definition – Financial

Accounting – Define Credit Control Area
• Transaction Code: OB45

Step 1: Enter T-Code “OB45” in the SAP command field and enter.

Step 2: On change view “credit control areas” overview screen, click on “New Entries”
button to configure new credit control area as per company requirements.

On new entries credit control area screen, update the following details:

• Cred.control.area: Give the four digits alphanumeric key that identifies credit
control area in SAP.
• Description: Update the descriptive text of credit control area. Now this field
remains blank, it allows you to update description after saving this key.
• Currency: Give the currency key INR
• Fiscal year variant: Update the fiscal year variant key.
• Risk Category: It is required to define the risk category of different nature and
assign them to credit control area.
• Credit Limit: Under this field, you need to maintain credit limits for customers.
• Organizational data: If you choose all company codes options, then this credit
control area is applicable for company codes.

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After updating the required details, click on save button to save the configured detail.

Step 3: Now go back to main credit control area screen, click on position button and give
credit control key and update the descriptive text of credit control area and click on save
button to save the details.

Credit Control Area of DEEPA LTD.

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  ASSIGN CREDIT CONTROL AREA TO COMPANY CODE

After we define credit control area in SAP, it is mandatory to assign to company

code. Ensure that appropriate credit limit is specified in credit control area, so you can
determine credit limits via Accounts Receivable.

MEANING OF ASSIGNMENT OF CREDIT CONTROL AREA TO COMPANY CODE

The link between credit control area and company code in SAP system is
established through the assignment of credit control area to company code.

STEPS TO ASSIGN CREDIT CONTROL AREA TO COMPANY CODE

We can assign credit control area to company code by using:

• Navigation Path: SPRO – IMG – Enterprise Structure – Assignment – Financial

Accounting – Assign Company Code to Credit Control Area
• Transaction Code: OB38

Step 1: Enter T-code “OB38” in the SAP command field and enter.

Step 2: On change view “Assign company code – Credit control area “: overview screen,
click on position button and update your company code in the given field and press enter.

Step 3: Now update the credit control area key against your company code.

DEEP DEEPA LTD. DEEPA

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  DEFINE SEGMENTS

MEANING OF SEGMENTS IN SAP FICO

A Segment is a division of an organization for which you can generate financial

statements for the purpose of external reporting. There are two types of segments.
They are:

• Business Segment: A Business Segment is a sub activity of an organization that

relates to the manufacture of a product or provision of service and that has risks
and revenues that differ from those in other business segments.

• Geographical Segment: A Geographical Segment is a sub activity of an

organization that relates to the manufacture of a product or provision of service
within a specific field of business.

STEPS TO DEFINE SEGMENTS

We can define segments by using:

• Navigation Path: SPRO – SAP IMG – Enterprise Structure – Definition – Financial

Accounting – Define Segment
• Transaction Code: S_AL0_19000003

Step 1: Enter SAP transaction code “S_AL0_19000003” in the sap command field and
enter to continue.

Step 2: On change view “segment for segments reporting”: overview screen, click on
“new entries” button to create new segments in SAP as per company requirements.

On new entries segment screen, update the following details:

• Segment: Update key that identifies the segment in SAP.

• Description: Update the descriptive text of segment.

After updating all the details, click on save button to save the configured segments in
SAP.

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  DEFINE FINANCIAL MANAGEMENT AREA

MEANING OF FINANCIAL MANAGEMENT AREA IN SAP FICO

Financial Management Area in SAP is an organizational unit that organizes the

company from aspect of cash management and funds management. We can assign one or
more company codes to a FM area. The FM area is taken from the company code when
company code assigned to an FM area.

STEPS TO DEFINE FINANCIAL MANAGEMENT AREA

We can define financial management area by using:

• Navigation Path: SPRO – IMG – Enterprise Structure – Definition – Financial

Accounting – Maintain FM Area
• Transaction Code: OF01

Step 1: Enter transaction code “OF01” in the SAP command field and enter to continue.

Step 2: On change view “Create FM Areas” Overview screen, click on entries button to
create new financial management area in SAP as per the organizational requirements.

On new entries: Overview of added entries screen, update the following details:

• FM Area: Give the four alphanumeric key that identifies the Financial Management
Area in SAP.
• FM Area Text: Update the descriptive text of FM area.
• FM Area Currency: Update the currency key under which currency financial
management areas are to be maintained.

After updating all the details, click on save button and save the configured details.

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SUMMARY TABLE OF ENTERPRISE STRUCTURE

ENTERPRISE STRUCTURE IN SAP FICO S/4 HANA

TRANSACTION
STEPS CONFIGURATIONS PATH
CODES

SPRO – SAP Reference

IMG – Enterprise
Step 1 Define Company Structure – Definition OX15
– Financial Accounting
– Define Company

SPRO – IMG –
Enterprise Structure –
Definition – Financial
Step 2 Define Company Code OX02
Accounting – Edit
Copy, Delete, Check
company code

SPRO – IMG –
Enterprise Structure –
Definition – Financial
Define New Company
Accounting – Edit
Step 3 in SAP by Copying EC01
Copy, Delete, Check
Existing Company Code
Company Code –Copy
Delete Check Company
Code

SPRO – IMG –
Enterprise Structure –
Assign Company Code Assignment – Financial
Step 4 OX16
to Company Accounting – Assign
Company Code to
Company

SPRO – IMG –
Enterprise Structure –
Definition – Financial
Step 5 Define Business Area OX03
Accounting – Define
Business Area

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 ENTERPRISE STRUCTURE IN SAP FICO S/4 HANA

TRANSACTION
STEPS CONFIGURATIONS PATH
CODES

SPRO – IMG –
Enterprise Structure –
Step 6 Define Functional Area Definition – Financial FM_FUNCTION
Accounting – Define
Functional Area

SPRO – IMG –
Enterprise Structure –
Define Credit Control
Step 7 Definition – Financial OB45
Area
Accounting – Define
Credit Control Area

SPRO – IMG –
Enterprise Structure –
Assign Credit Control Assignment – Financial
Step 8 OB38
Area to Company Code Accounting – Assign
Company Code to
Credit Control Area

SPRO – SAP IMG –

Enterprise Structure –
Step 9 Define Segments Definition – Financial S_AL0_19000003
Accounting – Define
Segment

SPRO – IMG –
Enterprise Structure –
Define Financial
Step 10 Definition – Financial OF01
Management Area
Accounting – Maintain
FM Area

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