SAP Finance and Purchasing

Finance and Purchasing Overview
Finance & Purchasing Overview
COURSE OVERVIEW
Finance Finance & & Purchasing Purchasing Overview Overview
SAP SAP Overview Overview Tarrant Tarrant County County Implementation Implementation Finance Finance & & Controlling Controlling Modules Modules Materials Materials Management Management Module Module Getting Getting Help Help Accessing Accessing Training Training Materials Materials
COURSE OBJECTIVES
The Finance & Purchasing Overview course has two purposes: Introduce SAP and the finance and purchasing modules Prepare you for role-specific training courses Objectives of the course: Review SAP system and integration Understand Tarrant County implementation Become familiar with terms Provide a high level understanding of:
General Ledger Functionality Accounts Receivable Functionality Accounts Payable Functionality Asset Accounting Functionality Controlling Functionality Grants Management Functionality Funds Management Functionality Materials Management Functionality
How to get Help How to access training materials
Lesson 1: SAP Overview

SAP stands for Systems, Applications, and Products
The SAP system is a fullyintegrated system where activities in one area generate activities in another area
The system provides online, real-time information and one place for input of data
4
Modules in SAP
SAP is made up of various functional modules Each module covers a different business function Tarrant County is using the following modules:
CO FI HR MM GM FM
Controlling Financial Accounting Human Resources/Payroll Materials Management Grants Management Funds Management
TC is also using ESS (Employee Self Service) for employees to enter time and maintain personal information.
How They Work Together

HR/Materials Management Modules
PAYROLL
FI Module
ASSETS ACCOUNT S PAYABLE
Other Financial Modules

FUNDS MANAGEMENT
PURCHASING
CONTROLLING
INVENTORY MANAGEMENT
ACCOUNTS RECEIVABL E
GRANTS MANAGEMENT
Integration in SAP
System Integration
When a transaction is executed in any module, SAP automatically updates data in all application modules that are affected Benefits of Integration
Enables simplified business processes, standard data definition, and a common business language Simplified business processes enhance productivity to allow focus on value-added activities Data has to be entered only once and all related information is updated automatically Integration eliminates need for redundant analysis and reconciliation
Finance & Purchasing Overview 7
Business Flow Integration
Requisitioner
Procurement Officer
Vendor
$$$$$
Receiver GL Accountant Budget Officer
Asset Manager Accounts Payable Officer Finance & Purchasing Overview 8
Hitting the G/L

Goods Issue MM Direct Posting G/L Customer Payments AR Vendor Payments AP Goods Receipt MM Invoice Verification AP
l a r r e en ge G ed L
Charges MM Charges AP Vendor Invoices AP

9
Depreciation AA
Data
SAP contains two types of information
Master Data
A collection of information about an object or person It is referenced whenever that object or person is used in an entry field This data does not normally change Examples are address and payment information for a vendor or customer
Transactional Data

Information associated with a specific business activity You enter this information in SAP Changes from day to day Examples are: Invoices Purchase requisition
10
Master Data vs. Transactional Data

Master Records Records that remain in the system for an extended period of time.
G/L Accounts Customer Master Records Vendor Master Records Grants Master Records Asset Masters Material Master Records
Transaction Records
Journal Entries Invoices Payment Requisitions
Records a specific event
11
Examples of Master Data

Tarrant County Purchase Order
Vendor Master Data
To: ABC Company, Vendor #1001 12345 Any street Any town, USA 54321
P.O. # 56789 Date: July 2, 2004
Qty
$$ 10.00
Widgets (material #15005), box of 10
10 bx
Material Master Data
Total
100.00
12
Examples of Transactional Data

Tarrant County Purchase Order
To: ABC Company, Vendor #1001 12345 Any street Any town, USA 54321
Cost Center 987
P.O. # 56789 Date: July 2, 2004
Transactional Data
Qty $$
Widgets (material #15005), box of 10
10 bx 10.00 100.00
Total
13
Documents & Document Types

A Document generally consists of a document header and line items.
Date Document type Document number
Document header contains data that identifies a document and applies to the entire document.
Line items generally include
Amount Account assignment Additional details specific to the transaction
Document Types are located on the header portion of every document

Distinguish between different business transactions Control document number assignment Help manage accounting documents
14
Document Structure Illustration
The Accounting Document

Document No: SAxxxxxx
Date: 05/06/2004 Company Code: TC01 Currency: USD
Header
Revenue A/C
DR CR Bank 10000
Citibank
DR Sale 10000 CR
Line Items
Debits = Credits
15
Document Types Illustration
A document type is a key that is used to classify accounting documents and distinguish between business transactions to be posted
16
Purchasing Document Types

Purchase Requisition Approval
RFQ
Purchase Order
Contract
Master Data
17
Tarrant County Document Types

Document Type AA AB DA DG DR DZ KA KG KR KZ SA SB WA WE Description Asset posting Accounting document Customer document Customer credit memo Customer invoice Customer payment Vendor document Vendor credit memo Vendor invoice Vendor payment G/L account document G/L account posting Goods issue Goods receipt
18
Terms
Standard SAP terms:
Application computer program Client unit in SAP system where data is input, changed, and managed Data pieces of information; numbers or text ERP Enterprise Resource Planning; designed to integrate and run all aspects of an organization Information data that has been collected Integrated transactions that are completed in one module or process trigger transactions in other modules Menu Path sequence of menu selections that should be followed to get to a function or screen Module portion of SAP system that carries out a specific business function Real-time describes how data that has been entered into the system is available immediately after the transaction has been saved. Everyone has access to the same data. Session instance of SAP; allows multi-tasking within system Transaction screen or series of screens to create, display, or change data Transaction code (t-code) unique identifier for each transaction that allows you to get to a transaction without going through the menu User role assigned to each employee; set of activities used by the employee Variants a saved set of personal selection criteria which can be used for lists and reports 19
Lesson 2: Tarrant County Implementation

Tarrant County is implementing the following modules in SAP:
Human Resources (HR)
Takes care of payroll, time recording, applicant administration, and organization data. Supports the planning and control of personnel activities. In use since October 2003
Financial Accounting (FI)
Designed for automated management and reporting of General Ledger (GL) Accounts Receivable (AR) Accounts Payable (AP) Asset Accounting (AA) External reporting, such as income statement and balance sheet
Controlling (CO)

Represents cost and revenue flows throughout the organization Aids in organizational decision making Supports internal reporting such as cost center reports
20
Tarrant County Implementation
(contd)
Tarrant County is implementing the following modules in SAP :
Materials Management (MM)
Supports the complete cycle of material flow, from the requisition to purchase to the warehousing and distribution
Grants Management (GM)
Manages the application, award, budget tracking, and closing of a grant
Funds Management (FM)
Supports the management of budgets Budget can be adapted to changes in conditions by entering releases, supplements, returns, and transfers Tracks expenses to budget
Tarrant County is also using Employee Self-Service for employee entry and management of time, personal data, training & events, appraisals, and benefits enrollment.
Tarrant County Finance & Purchasing Modules

Materials (MM) Financials (FI) Controlling (CO) Funds Management (FM) Grants Management (GM)
Management
Purchasing
General Ledger
Inventory
Asset Accounting
Accounts Payable Accounts Receivable
22
Organizational Elements
The following organizational elements and codes are used in Tarrant County:
Company Code TC01
Organization unit where individual financial statements are created Self-contained Chart of Accounts Self-contained organization unit where management of costs and revenues is performed
Controlling Area TC01
Purchasing Organization TC01 Chart of Accounts TC01 Plants
Organizational unit that procures materials or services List of all General Ledger (GL) accounts used Organizational unit for Admin and Stockrooms Tarrant County Admin (all non-stock purchases) TC01 Sheriff (Stockroom) TC04 Justice Center (Stockroom) TCJC Central Supply (Stockroom) - TCCS Finance & Purchasing Overview 23
Tarrant County Organization Structure
Chart of Accounts TC01
FI
For all (AP, AR, GL, AA) process settings For management reporting module settings For all Purchasing settings
Controlling Area TC01
CO
Purchasing Organization TC01
MM
Company Code TC01
FI/MM
Basic entity in SAP for a legal entity
Plant TC01
Plant - TCJC
MM
Plant TC04 Plant - TCCS
For all Logistics settings
24

Tarrant County terms:
GASB Governmental Accounting Standards Board Go-Live date when SAP module is scheduled to run live in production system Phase I 10/01/03 HR/Payroll Phase II 07/06/04 Financial/Purchasing Phase III 04/01/05 Budget Prep Legacy System existing County system that either interfaces with SAP or provides data for start up of SAP Production System live SAP system used for normal operations SME subject matter expert; County employee who has experience or expertise in a specific functional area TITAN Titan Integrated Task Access Network; County implementation of SAP system
25

Why Change?? Systems with duplicate data Have to use different systems to enter and get information Have to wait for processing to get data
What Does Business Change Involve? Changing the way we work Changing our roles Changing the tool
26

How Will Change Affect Us?
Major changes such as Tarrant County is implementing will have an initial effect on peoples performance Over time, the benefits achieved will far outweigh the initial impacts
Productivity
Time Initial Change Maximum Benefits Achieved Continuous Improvement

27
Lesson 3: Finance & Controlling Modules
28
What is FI and CO?

Financial Accounting (FI) and Controlling (CO) are independent components in the SAP system. The two components are tightly integrated and the data flow between them takes place on a regular basis.
FI
General Ledger Accounts Payable Accounts Receivable Asset Accounting Controlling
Manages all financial accounts Manages vendor invoices Manages customer billing Manages fixed assets and depreciation Manages responsibility accounting
29
FI
FI
FI
CO
Reporting Overview
EXTERNAL AGENCIES Journalists Media
Auditors
Tax Authorities
Insurers
FI Financial Accounting
External Financial Analysts
External
CO Controlling Internal
Financial Statements Managerial Reports

Internal
Tarrant County Management
Tarrant County Employees Finance & Purchasing Overview 30
Financial Accounting (FI)

The FI module is designed for automated management and external reporting of general ledger, accounts receivable, accounts payable, asset accounting, and other sub-ledger accounts within the chart of accounts
This is the key component structure of financial accounting

Master Records General Ledger Accounts Payable Accounts Receivable Fixed Assets Periodic Processing
31
Financials (FI) General Ledger (GL)
Financials (FI) General Ledger Asset Accounting
Used Usedfor forexternal external reporting reporting Document Documententry entry
Contains General Ledger Accounts Chart of accounts
Accounts Payable Accounts Receivable
Account AccountManagement Management
l a r r e en ge G ed L
General Ledger (GL) Roles & Responsibilities
Financials (FI) General Ledger
Departments Display general ledger accounts, documents, and line items
Asset Accounting Accounts Payable Accounts Receivable
Auditor Maintain G/L accounts Approve and post documents
33
Financials (FI) Accounts Receivable (AR)

Processes Processescash cashreceipt receipt transactions transactionsfor foreither either accounts accountsreceivable receivableor or revenue revenuetransactions transactions Invoices Invoicesor orbills billscustomer customer for foramount amountdue due Contains Customers Billing logic Dunning
Financials (FI) General Ledger Asset Accounting Accounts Payable Accounts Receivable
34
Accounts Receivable (AR) Roles & Responsibilities

Departments Record cash receipts into Cash Journal Enter customer invoices / credit memos to create receivables
Auditor Check entries and posts cash journals Perform new customer setup
35
Financials (FI) Accounts Payable (AP)

Process Processinvoices invoices Generate Generatewarrants/checks warrants/checks by bydue duedate dateor ordiscount discount date date Produce Produce1099 1099Reports Reports Contains Vendors Warrants Checks
36
Accounts Payable (AP) Roles & Responsibilities

Department
Enter Invoice Documents Park documents when invoice verification fails
Auditor
Maintains Vendor Master Reviews entered documents (except parked documents) and releases invoices for payment Reviews parked documents to resolve problems; may contact the vendor, requisitioner or buyer. Issues checks for invoices with a free for payment status
37
Financials (FI) Asset Accounting (AA)

Provides Providesmanagement managementof of capitalized capitalizedor ortracked tracked assets assets Generates Generatesdepreciation depreciation transactions transactionsfor forthe the general generalledger ledger
Contains Accounting Accounts Tag numbers Payable Asset Classes Accounts Receivable Depreciation profiles Capitalized assets Tracked assets
Asset
38
Asset Accounting (AA) Roles & Responsibilities
Department Create the asset shell at the requisition stage Auditor Maintain asset master records Issue asset tags for Capital and non-computer low value assets Update the records for additional information such as serial numbers Update Capital Asset record master data
Asset Accounting Accounts Payable Accounts Receivable
39
Controlling (CO)
The CO module represents the Countys flow of costs and revenue. It is also a management instrument for organizational decisions. A key tasks is the analysis of FI data. Variances can be determined by comparing actual data with plan data.
This is the key component structure of Controlling:

Cost Element Accounting Cost Center Accounting Internal Orders
40
Controlling (CO)
Controlling (CO)
Used Usedfor formanagerial managerial reporting reportingor oractivity activity reporting reporting Used Usedto tocollect collectand and allocate allocatecosts costs
Contains Cost Centers Projects Internal Orders
41
Controlling (CO) Roles & Responsibilities

Department Display:
CO reports Cost center/cost center group data Internal order/internal order group data Budget information for internal orders
Controlling (CO)
Auditor
Display CO reports Create, change, and display: Cost centers/cost center groups Internal orders/internal order groups Internal order budget information
42
FI/CO, GM & FM Integration & Terms
FI/CO Grant Fund

Cost center, Functional Area Cost Elements & GL Accounts
GM Grant Fund
Sponsored Program Sponsored Class Budget Validity Period
FM Grant Fund
Fund Center, Funded Program, Functional Area
Commitment Item
Fiscal Year
Fiscal Year
43

Plan, Plan,budget, budget,identify, identify,obtain, obtain, and andrecord recordall allfunding fundingrelated related to toawarded awardedgrants grants Differentiate Differentiatebetween between eligible eligibleand andineligible ineligiblecosts costs Bill Billand andrecord recordsponsor sponsor amounts amounts Record Recordand andreport reportall allrelated related costs, costs,revenues, revenues,and andrequired required information information
Contains:
Grant lifecycles Grant details Grant reports
44
Grants Management (GM) Roles & Responsibilities

Department
Display Grants Grant budgets Grant reports
County Administrators Office

Display Grants Grant budgets Grant reports Create grants
Auditor
All above Maintain grant master data Manage grant cycles Monitor grant postings Finance & Purchasing
Overview
45

Maintains Maintains budgetary budgetary control controlfor forall allexpense expense activity activity
Contains Funds Fund Centers Commitment Items
$$$$$
Budget Officer Finance & Purchasing Overview 46
Department
Funds Management Roles & Responsibilities
Pre-post budget transfers for adjustment within their own level of departmental control Post transfers within budget control categories of commitment items
Budget Office
Pre-post budget transfers between departments Generate report listing pre-posted transfers needing Commissioners Court approval Post transfers after approved by Commissioners Court Create supplement, return, and entry budget documents
Auditor
Create and change funds block Create and change funds reservation Create and change funds commitment
Lesson 4: Materials Management Module (MM)
48

The MM application component supports the procurement and inventory functions occurring in day-to-day business operations such as: materials planning and control, purchasing, goods receiving, and inventory management. Invoice verification is an MM function but is executed by Accounts Payable.
This is the key component structure of Materials Management:

Invoice Verification (Done by AP)
Master Records
Purchasing
Inventory Management
49

Purchasing is responsible for:
External procurement of materials and services Determination of sources of supply (vendors) Monitoring deliveries from vendors Management of stocks Planning, entry, and documentation of all goods movements
Inventory Management is responsible for:
Key Terms
A purchasing organization is an organizational unit that procures materials or services. It negotiates purchasing conditions for plants assigned to it. A plant is an operating unit that makes goods available for distribution.
50
Materials Management (MM) Purchasing Integration

Materials Management (MM) Financials (FI) Controlling (CO) Funds Management (FM) Grants Grants Management Managemen (GM) (GM)
Purchasing General Ledger
Inventory
Log. Invoice Verification
Asset Accounting
Accounts Payable
51
Materials Management (MM) Integration of Inventory

Materials Management (MM) Financials (FI) Controlling (CO) Funds Management (FM) Grants Management (GM)
Purchasing
General Ledger
Inventory
Log. Invoice Verification
Asset Accounting
Accounts Payable
52
Materials Management (MM) Purchasing

Use Useto toorder orderor orcontract contract for forgoods goodsor orservices. services. Supports Supportsrequests requestsfor for quotes quotesfrom fromvendors vendorsfor for goods goods Processes Processesreceipt receiptof ofgoods goods
Purchasing
Inventory
Contains Requisitions RFQ Purchase orders Vendor Performance Contracts Vendor
53
Departments
Materials Management (MM) Purchasing Roles & Responsibilities
Create, change, display purchase requisitions Material Service Asset Grant Create asset shell Approve purchase requisitions Post goods receipts Post service entry sheets View material mater, vendor master, and service master records
Purchasing Inventory
Purchasing Department
Display/report on vendor, material, and service master records Create, change, display purchase orders and RFQs Display/report on quotation and purchase order price histories Maintain bids, Info Records, source lists, outline agreements, and contracts
54
Materials Management (MM) Inventory
Materials
Management
(MM)
Use Usefor forsupplies suppliesinventory inventory Purchasing Supports Supportsstoring storingand andissuing issuing Inventory goods goodsfrom fromwarehouses warehouses Contains MRP MRP(materials (materialsrequirement requirement Plants planning) planning) Delivery Addresses Physical Physicalinventory inventoryprocessing processing
55
Materials Management (MM) Inventory/Audit Contracts Roles & Responsibilities

Departments
Display/report on vendor master records, material master records, material documents, service master records, purchase orders, and contracts Process goods movements Goods receipt Goods issue Reversals Post service entry sheets
Purchasing Department
Display/report on vendor master records, material master records, material documents, service master records, purchase orders, RFQs, and contracts Create/change contracts Create/change purchase orders
56
Materials Management (MM) Inventory/Audit Contracts Roles & Responsibilities

Warehouse Stock Clerks
Display/report on vendor master records, material master records, material documents, service master records, purchase orders, and contracts Process goods movements Goods receipt Goods issue Reversals Run various inventory management reports Perform MRP (materials requirement planning) and post to funds management Perform/enter physical inventory counts Create, change, and display physical inventory documents Create purchase requisitions for stock replenishment
Auditor
Display/report on vendor master records, material master records, material documents, service master records, purchase orders, and contracts Create/change contracts Create/change purchase orders Process goods movements Post service entry sheets
57
Lesson 5: Getting Help

1
Review the on-line help in SAP
Review your training materials and notes.
Ask your peers or super user for assistance.
58
Tarrant County Help

Problems with running tutorials?
Training Mailbox
titansaptraining@tarrantcounty.com
After utilizing the various methods of help on the previous page, if you still have questions or problems
or
If you have problems at any time with accessing SAP, printing, computer or network problems, etc. Contact the Tarrant County IT Help Desk at 817-884-3507
59
Lesson 6: Accessing Training Materials

All TITAN training materials for Finance & Purchasing are stored on the Tarrant County website This website is accessed through your Internet Explorer from any computer that has internet access; you do not have to be on the Tarrant County network. The URL for direct link to the Training Materials website is: http://www.tarrantcounty.com/titan/lib/titan/training/index.asp Set up this website as a favorite in your web browser for quick future access
Enter the URL above in the address field in your browser When you reach the website, go to Favorites>Add to Favorites in the Browser menu A pop-up window will be displayed with a default name for the site. Click OK. To access this site in the future, just click on the Favorites item in the browser menu and highlight the name for the website. You will go directly to the website.
Accessing Training Materials

(contd)
Review the instruction page to understand how to use the website Click on the Courseware link at the top of the Instruction page A Listing of Courses will be displayed
Click on the Course Title to see a general description of the content of the course or Click on one of the buttons beside the Course Title to go directly to either the Overview, Quick Reference Cards, or Tutorials These training materials will be available for your use and reference at any time
Running Tutorials
An additional learning tool is being provided with the Phase II SAP implementation -- Tutorials Tutorials are simulations of the SAP system that take you through a transaction step-by-step in a mock SAP environment These can be viewed in two ways:
As a movie that takes you through the transaction in a demonstration, or As an interactive, hands-on practice session that stops at each step and directs you to make entries in fields or take actions per instructions provided by the wizard and in the bubbles
Tutorials are provided with each course in the Finance and Purchasing training A list of the tutorials is provided at the end of each course. Go to the Training Materials website to access and run these tutorials. Detailed instructions are provided on the website when you click on the Tutorials button
Happy Tutoring!!
Training Sandbox
An SAP environment (Training Sandbox) where you can practice your skills in a real instance of SAP will be available after midJune The sandbox can be accessed through the standard logon process discussed in Lesson 2 of the SAP Basic Navigation course The only differences are: Highlight the Training environment on
the logon pad Click logon Enter 520 in the Client field Enter the same User Id and Password you are assigned for Production
Feel free to practice any of the tasks in the basic navigation course and any of the transactions included in other courses you take. Use the Quick Reference Cards to walk you through the transactions.
Congratulations!!

COURSE SUMMARY
You have completed the Finance & Purchasing Overview and have reviewed the following topics:
SAP system and integration Tarrant County implementation Terminology High level functionality:
General Ledger Accounts Receivable Accounts Payable Asset Accounting Controlling Grants Management Funds Management Materials Management
You are now ready to complete your role-specific training courses

Getting Help Accessing training materials
64

SAP Finance and Purchasing

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Finance and Purchasing Overview

Finance & Purchasing Overview

Finance & Purchasing Overview

How to get Help How to access training materials

Finance & Purchasing Overview

Lesson 1: SAP Overview

Finance & Purchasing Overview

Finance & Purchasing Overview

How They Work Together

Other Financial Modules

Finance & Purchasing Overview

Business Flow Integration

Asset Manager Accounts Payable Officer Finance & Purchasing Overview 8

Hitting the G/L

Charges MM Charges AP Vendor Invoices AP

Finance & Purchasing Overview

Finance & Purchasing Overview

Master Data vs. Transactional Data

Records a specific event

Finance & Purchasing Overview

Examples of Master Data

Vendor Master Data

P.O. # 56789 Date: July 2, 2004

Widgets (material #15005), box of 10

Material Master Data

Finance & Purchasing Overview

Examples of Transactional Data

P.O. # 56789 Date: July 2, 2004

Widgets (material #15005), box of 10

Finance & Purchasing Overview

Documents & Document Types

Line items generally include

Amount Account assignment Additional details specific to the transaction

Document Types are located on the header portion of every document

Finance & Purchasing Overview

Document Structure Illustration

The Accounting Document

Finance & Purchasing Overview

Document Types Illustration

Finance & Purchasing Overview

Purchasing Document Types

Finance & Purchasing Overview

Tarrant County Document Types

Finance & Purchasing Overview

Finance & Purchasing Overview

Lesson 2: Tarrant County Implementation

Human Resources (HR)

Financial Accounting (FI)

Finance & Purchasing Overview

Tarrant County Implementation

Tarrant County is implementing the following modules in SAP :

Materials Management (MM)

Grants Management (GM)

Manages the application, award, budget tracking, and closing of a grant

Funds Management (FM)

Tarrant County Finance & Purchasing Modules

Accounts Payable Accounts Receivable

Finance & Purchasing Overview

Controlling Area TC01

Purchasing Organization TC01 Chart of Accounts TC01 Plants

Tarrant County Organization Structure

Chart of Accounts TC01

Controlling Area TC01