+R.S.Technologies _ Institute of Corporate Finance Career Accounting y + p J Advanced Package) areeiinnm | Excel eye MeL CU Cem eZ ERR A C9) RS) ELL MLL) oo Mangamoor Road, ONGOLE, Call us : 91828 66779.FULL FORM Systems Applications and Products in Data Processing ASAP end user uses the finished SAP system to create or modify variousibusined Felaed tasks, Record transactions and maintain applications and systematic up to due date ERP: Enterprise Resource Planning. SAP: Maintain security, systematic books of records. SAP ERP. SAP Technical Modules youkiMayvith e0¥ing, to prepare software. ‘SAP Functional MgulesGvor Bing aigi) FICO, MM, SD, PP, and HCM. | rerset arene in sar ene eer B} order to Cash (SD Module) Lee ry 1 Prepared by Suresh‘SAP (FICO) ENDUSER — Working General Ledger (GL): It is nothing but day to day transactions ~ R2R / Recording to Report. Accounting payable (AP):These are current liabilities and we will enter! mention current liabilities in balance sheet. P2P process/ Procure to Pay. It is Also known as purchase-to- ay and P2P, procure-to-pay is the process of requisitioning, purchasing, receiving, paying for, ‘and accounting for goods and services, covering the entire process from point of order right through to payment Accounts Receivable (AR):A poor order-to-cath process means invoices typically aren't collected on time, Accounts receivable and the invoicing system during O2C determine a company’s cash inflows. The order-to-cash process (also called O2C or OTC) refers to the cntirety of a company's ordering system. It starts the moment a customer places an order and ‘ends when an invoiee is paid and settled, Designations of End Us ‘Name of Role Years of Service LPA Package Process Associate 2Years 2.6010 3.00 ‘Accounts Executive ~ 3 Yeas 3,00t03.80 (Or Process Developer Senior Accountant ~ 3Yeas = -3.50104.60 Financial Analyst - 4 Years = ——-5.00106.00 Manager or TL - 5 Years = 6.0010 8.00 Record to report (R2R) involves collecting, processing, and presenting accurate financial data. ROR provides strategic, financial, and operational feedback on the performance of the ‘organization to inform management and other stakeholders, Record to Report processes — 1. Joumal eniry posting ung Waster 2. Accrual creation yas ences 3. GL (reelass) postings ‘Analysing (Debit & Credit) 4, Information (Exchange rate) updates v 5. Reporting Summertsing (st v Recording (in SAP) ¥ Reporting (to Client & MGT) 2 Prepared by SureshAutomation of RTR Process in SAP S/4HANA tet anger Seen Hoste ©- © -6-F-s. aha Example wih Standard Bots pane avolable in ot Store with SAP piety ne cia ep tsa hop and stm apie Custom Bots can be easily bul with low code/ne code wth SAP Inteligent RPA2.0 ‘The RIR Process also covers the steps involved in preparing and reporting the overall account, which are typically stored in a general or nominal ledger and managed by a Comptroller. ‘The Record to Report Process Cycle involv Data Extraction Data Collection Data Validation Data Transformation (generation of voucher) ‘Voucher Posting ((o the general ledger) Storing Vouchers in De-Normatized and Compressed Format Generating Analysis Accoust Trial Balance Generating Financial And Management Reports 3 Prepared by SureshSEN] CODE ‘CLASSIFICATION oO. 1 FBO] _ | POSTDOCUMENTIGLPOSTINGUSINGERCEL 72 | FB02 | CHANGEDOCUMENT 3[ Fh03 | DISPLAYOFPOSTINGDOCUMENTS | FB08 | REVERSAL 3] FBDI_| RECURRING 6| FBD2 | CHANGERECURRING 7 FBD3 _| DISPLAY RECURRING ‘S| FBDS | REALISERECURRINGENTRY ‘9[ FBL3N | GLACCOUNTLINEITEMDISPLAY To| FBSI__| POSTACCURAL&DEFERRAL TI] FAGLB | RECONCILIATION 03 12 | F-01 _ | POSTSAMPLEDOCUMENT 13 | FBMI_| ENTERSAMPLEDOCUMENT, Ta FBMD | CHANGESAMPLEDOCUMENT: TS | FBM3_| DISPLAYSAMPLEDOCUMENT 16 | FEMA _| DISPLAYSAMPEEDOGUMENTCHANGES 17) FBR2 _ | CONVERTSAMPLEDOCUMENTTONORMAL TS [F357 _| DELETESAMPLEDOCUMENT 19 | FV50__ | PARKEDDOCUMENTPOSTEDINSINGLESCREEN 20] F-65 _ | PARKEDDOCUMENTROSTEDINDOUBLESCREEN 21 | FBV3 _| DISPLAYPARKEDDOCMENTLIST 22 | FVS0 | CHANGEDPARKEDDOCUMENT 23 | FBVS”_| DISPLAYGHANGES 24] BVO, | DELETEPARKEDDOCUMENT 25] FBI |)POSTHEEDDOCUMENT 26] ZFI__| GLPOSTINGMONTHLY WISE 2UfE-03___| CLEARINGOFGLACCOUNTS 25 | FBLIN | VENDORLINETTEMS 29| FBLSN | CUSTOMERLINEITEM 30] FB60 | ENTERINVOICES 3T|FBS0 | CREATIONOFIVS Prepared by SureshSample Document (F-01):Sample document is a reference document for the original documents. It will not update any transaction figures. We can use the sample documents for month end provisions. The Te is F-01, You ean use the standrad document type 1X2 for sample documents Recurring Document (FBO1):Recurring enivies are business transactions that are repeated regularly for every month, such 2s rent or insurance, salary payments etc Hold Document (FB11): Sometimes hold the transaction posting due to doubtful transactions, He or she can use the document holding functionality or temporarily holding for posting. In simply, Hold documents is used when we need to get any clarifiction beglieding some account Eg: No clarification about Debit or Credit in the transaction, Parked Document (FV50): A parked document in SAP is @ document saved but not yet posted to general ledger accounts. If an employee does not Access for post the document, in this case document has been parked, once getting access for posting can be edited and posted to GL. Parking documents is used when we need to get ang laification regidisig soe account. Reversal (FBO8): It is used fo reversal the posted doeument, whichis incorrect or wrong entry. Duplicate Document / involee:If you post document/invoice in multiple times in SAP assigned duplicate number for posted in the system more than once, Posting IVs (Journal Vouchers) *posttg daily transactions Checking GLline Items, Verifying the Balances of Ca8hnd Bank books Enter the Reclrring Eatries Preparation of Hold, Parked and Sample documents (if necessary), Regonciliation Provide backups Real Time Errors im SAP: Profit centre is blocked ‘© Miss-mite Accounts in excel sheet Reconciliation GL posting Monthly wise Reversal entries Accruals & Deferrals IDM - Journal Duplicate members HEM - Hyper Financial Management 5 Prepared by SureshHEM - Hyper Financial Management: HFM system isa designated tool forthe integration of financial reports. It is month end activity after completion of posting at the end of the month, we run on HFM (manager level onl). ‘Opening entries: The Opening Entries is the balance sheet amount which is brought forward at the beginning of an accounting period from the end of previous accounting, The opening balance consists of Assets, Capital & Liabilities of the company brought from previous year’s Balance sheet. Opening Entry Date Particulars LE [ Debit [ Creait® 2017_-| Cash Ale De 30,000 Jan 1 | Stock Ale Dr 15,000 Furniture Ale Dr 3,000 To Sundry creditors Ale 10,000] To Capital A/c (Balance of assets and liabilities brought forward) Closing entries: Closing entry is journal entry that is made at the end of an accounting Dera ote lanes Gum mga smut EOE RSE Dae Account Name [Deo [creat December ncome summary 1485000 -Desreciation Expense 2,000.00 ent Expense 30000 “Supplies Expense 50000 sities Expense ‘40000 Wages Expense 75000 Interest Expense 50000 Case Expense Accounts to Income Summary “Accruals &Deferrals Acerual concept? SAP gives fiinctionality of Accruals and Deferrals whereby provisional entries posted in one financial period for the purpose of closing can be reversed automatically in the next financial period with a single transaetion. Accruals refer any expenses or revenues are recognized, but not yet paid or received. It refers the transactions are recorded in the books of accounts but payment or receipt were not ‘made in the current year. Eg: Outstanding Expenses, Unearned Incomes 6 Prepared by SureshAccrual Accounting Examples We It refers, may paid or received vices has been provided. It means, ‘advanced payments or receipts ansactions are not made, ~ It includes, Deferrals Expenses and incomes. Eg: Prepaid Expenses, Deferred Revenue Journal Entry ean > % Sn CTs 112,000. : 7,000. "To Deferred Revenue A/e 11,000 Particulars Ps Deferred Revenue A/c... 1,000 "To Subscription A/c. 7,000, Journal Entries for Monthly Accounting <> waitstretsfojo 7 Prepared by Sureshidrevenue add expenses ‘earned but not incurred butnot yetinvoiced| yet billed Accrued Peet ran) ree snc) su Pra) Comat transfer toan asset unused expense ‘amounts f «Xd Amortization: It is the accounting practice of spreading the cost of an intangible asset over its useful life, Amortization is typically expensed on a straight-line basis, ~ Depreciation is the expensing of a fixed asset over its useful life ‘A contingent asset is a potential asset or economic benefit for a company. It does not currently exist ‘but may arse in the near future. For example, if the company is locked in a legal dispute and has the possibility of winning the case and being etiled 1 acaimor dans. Q:A court orders that XYZ Co. must pay ABC Co. 25,000/-in damages. ABC Co. has not yet received the money. Can it recognize this contingent asset as an asset now? Ans: Yes, now the contingent asset becomes an asset. Although the payment is not received, the ‘court has ordered the payment, So the income has become virtually certain and can now be recognized as an sel. Provisions: provision is usually an «siovn! that is set aside ffom a company's profits, usually to cover an expected liability or a decrease in the value of an asset. Eg: provisions for bad debis, sales allowances, and inventory obsolescence. 8 Prepared by SureshBank reconciliation statement (BRS) Bank reconciliation statement is a statement prepared mainly to reconcile the diflerence between the ‘Bank Balance’ shown by the Cash Book and Bank Pass Book. Its prepared from time to time to check that all transactions relating to the bank are properly recorded by the businessman in the bank column of the cash book and by the bank in its ledger account The difference in timing recording the transactions: The diference in timing can be caused by many factors which are: Bank-issued cheque but not yet deposited for payment Paid cheque in the bank but yet not cleared Bank made direct debit from the customer's side Cheque! amount deposited directly tothe bank account Dividends and Interest collected by the bank Bank made ditect payment from the customers side ‘Types + GLor Bank Reconciliation + Payable Reconciliation Receivable Reconelation + Asset Reconciliation Purpose Processing of Bank Statement in order to clear the Open Items in the Clearing Accounts and lransler fre same to the Main Bank Account. Running the statement on dally basis ensures that the balance as per the bank's statement and the balance as per the books of accounts are always reconciled. Trigger Bank Statement receved from Banks in physical or soft copy. Prerequisites ‘+ Bank Statement (soft copy / hard copy), House bank, Account 0, Statement Number ‘and Statement Date ° Prepared by SureshMenu Path Use the following meru pats) to begin this transaction + Select Accounting @ Financial Accounting ® Banks ® Input ® Bank Statement + Manual Entry to go to intial screen Transaction Code Fre Helpful Hints © Press Fi forhelp + Press Fé for getting input values © R-Required + O-Optional © _C~ Conditional A fund flow statement reveals the reaSens Vor CHiiges or differences in the financial position of a company between two balance sheets Fund flow statements represents thé\inflaw and outflow of funds - or the sources and applications of funds over a partictlar petiod. ‘A company’s finaneffl statements alfead include a profit and loss statement and a balance sheet So why isa fundflow statement needed at all? + A pit and loss aid balance sheet will show a company's financial position, but will not explain the reasons for fluctuations or variations in Within the company's financial or cash Position ‘\\A profit and Jos and balance sheet will depict two sets of figures - the current and ‘previous yea but will not explsin why movement has happened, A cash flow statement is a financial statement that provides aggregate data regarding all cash inflows (a company receives from its ongoing operations and external investment sources) and all cash outflows (that pay for business activities and investments) during a given period 10 Prepared by SureshHeads in cash flow statement © Investment Activities ‘© Financing Activities ‘There are 2 methods of preparing the Cash Flows from Operating Activities: DirBeHIMBtKAEWile preparing the Cash Flow Statement as per Direct Method, Actual ‘Cash Receipts from Operating Revenues and Actual Cash Payments for Operating Activities are arranged and presented in the Cash Flow Statement. IiidiFBEHIMGHHOE: The Indirect Method of preparating of Cash Flow Statement is a partial ‘conversion of accrual basis proft to Cash basis proft. Further, necessary adjustments are made for Increase/Decrease in Current Assets and Current Liabilities to obtain Net Cash Flows from Operating Activities as per the Indirect Method | eel a Prepared by Suresh[Cash Flow Statement (incirest Method) 7 [E] Cash flow from Operating Activities Profit for the period [Cl Achuctments for incame and expenses not invalving cashflows Depreciation of property. plant and equipment Amerization of intangible assets Gaind_oss (rom fixed assel reliremert [Changes in assets and iiabilities Increase (Decreace) of invertorioz Increase (Decreare) in accounts payables Increase (Decrease) in accoutns receivables (Net cash aenerated from continuing operating activities [Cash Flow Frem investing Activites Ble islelgla ele [] Purchase [Sale] of fixed a: =a] [Purchase (Sale) of tangible assets 5000] []Purchase (Sale) of ntangibte asst 2000] Increase (Decrease) in longterm investment 00 Net cash used in continuing investing activites: =z500] (Coch Flow Frem Financing Acivities Increase (Decrease} in cornmon stocks Zeal Increase (Decrease) in notes receivable 2000] [iver cosh generated from finencing ectviies 009] Net Cash Flow e200] A budget is an estimation of revenue and expenses over a specified future period of time and is usually compiled and re-evaluated on a periodic basis, Budgeting is the process of preparation and implementation of a budgets in business. Here are common types of budgets used by businesses: Master budget. Operating budget. Financial budget. Cash budget. Labor budget. Capital budget. Flexible budget Master budget: It provides a big-picture look at a firm's expenses and revenues, on a monthly and quarterly basis. Operating budget: An operating budget shows a business’s projected revenue and the expenses associated with it fora period of time. 2 Prepared by SureshFinancial budget. A financial budget looks beyond revenues and expenditures and folds in assets, liabilities and stockholder equity. Cash budget. Also known as a cash flow budget, this document estimates, how much money will pass through a business in a given month, quarter or year. Labor budget. Remmen says a labor budget is important for any business that has employees. It can be used to determine how many workers are needed to achieve the desired level of production and then plan for the payroll cost of those employees. Capital budget. A capital budget is how businesses plan for purchases of large assets such as machinery or a new building, Flexible budget: A flexible budget is generally used when you're ‘expecting different volumes for income and expenses (in Manufacturing Process and Product Costing) Variance calculation provides the diference between "Actual Costs’ and “Target Coss" posted on corder.- Material Cost Variance ~ Labour Variance Overhead Variance Sales Variance ‘There three types of commonly fdfed vatlagces manufacturing process ~ + Total Variance + Production Variance + Planning Variance + TeeVaraReS Total variance generally found on the order because of difference between “Actual Debit” and “Actual Credits" which is delivered to inventory. The important points to consider here “Total Variances" are the only variances which are “relevant for setlement + Production Variance = Production variance is always the difference between the debit actual costs consumed on order and target cost which is bazed on the preliminary cost estimate and quantity delivered to inventory. Production variance is calculated with the help of target cost version 1. These type variances are like “For Your Information” purpose only and are net relevant fr setlement activity. + Planning Variances = a Prepared by SureshPlanning variance generally arises because of the difference between plan costs on an order and standard cost based on cost estimate, Planning variances are generally computed based on Target Cost Version "2". Again these kinds of variance are net meant for settlement and for analysis purpose only SERVICE LEVEL AGREEMENT (SLA) Iis an agreement between company & client for daily activities. We should perform within two days or 48 hours for month end activities on the same day only. © For daily Activities = Two days (48 hours) © For Month-end Activities - on the day only. Daily Activities (vith in Two days) ‘© Reconciliation ‘© GL posting (Purchase, travelling, insurance, discount, daily chafges)eommission, pension, telephone etc.) ‘Month -end Activities (on the day only): ‘Acer, Deferrals, Reconciliation ee, Errors Responding: These are 4 types ‘© Prioriy-I| - Immediate Response © Priority - Within 2 Days’ © Priority - Within a Week, © Priority-IV - Within a month Questions arise on SLA, 1. Which service you are providing to tient A) We are servicing for sy tliem for daly activites within two days, for month end activities are onthe same day only 2. GPay peuilty if you break STA? A) Company will pay penalty. 3. What is your target i SLA? ‘A)\We shouldmainiain 100% accuracy fora client 4. \Hiave you maintain 100% accuracy to your elient all these years? A) yes, Pamantain, but one of my colleagues did mistake! did not record, it was happened Iwa8second year, Then give dashboard if 97% of accuracy. 5S. What you discussion with a client by SLA? A) Idiscussed with client regarding reports, trainings, team meetings, issues and new updates on transactions etc. 6. Where you involved in SLA? A) Linvolved in SLA, for daily transactions & month end transactions. 7. How much your project amount? 4 Prepared by SureshA) don’t know. 8, What is your company tumover? A) don’t know, itis highly confidential Invoice — notes ‘An invoice is a document that maintains a record of a transaction between a buyer and seller. An invoice or bill is an importaat written document that indicates the sale or supply by ‘one business to another business or consumer. It contains information about the particular sale ‘transaction, such as buyer's details, quantity, value, tax, and payment terms, ‘Types ofinvoices ‘© Purchase order-based invoices PO-based invoices are associated with one or more purchase orders ‘© Non-PO invoices ‘Non-PO invoices are invoices that are not associated with a purchase order. © Contract-based invoices ‘Contract-based invoices are associated with one or more contracts that you have with a supplier, ‘and must use contract pricing terms, ‘© Service sheet-based invoices If you receive a paper service sheet-based invoice from a supplier, you create an electronic service sheet-based invoice in your SAP Ariba invoicing solution, Roles & Responsibilities Of SAPEnd user (RIR) ‘© Reconciliation between bank and cash boOk balances by circulating weekly & monthly and confirming the balanées Performing the recurring entries Handling and)postifg JVs daily aid monthly wise Handling@eeruels inevery month Checking the Gl. line items‘and verifying balances Glgpesting monthly wise Reversal Accruals and'deferrals in month-end process ‘Exsucig month end activities have to be completed without missing SLA. Complete all activities within time line ‘Prepiting pafked documents, hold documents and sample documents ifuecessary ‘Submit daily & monthly reports for the management as per the date Prepare the DTPs for the process on client requirements Checking SOPs and reviews Reconciliation daily & monthlywise Usage of various T-Codes on the Daily and monthly activities Monitoring inter-company generic email box handling 8 Prepared by Suresh