What exactly is SAP FICO?

SAP FICO (Financial accounting and Controlling) 1st we see what is fico

SAP Financial Accounting (FI)

SAP FI module as the term suggests deals in managing financial transactions within enterprises. This financial accounting module helps employees to manage data involved in any financial and business transactions in a unified system. This module functions very well for reporting requirements. The SAP FI module is very flexible and functions well in any type of economic situation. Be it a smaller organization or a larger organization, SAP implementation helps in consolidating data for diverse business transactions and legal requirements. Financial Accounting module helps one to get real-time financial position of an enterprise in the market. SAP FI incorporates with other SAP modules such as SAP SD, SAP MM, SAP PP, Payroll and more for better work results.

SAP Controlling (CO)

SAP CO module is another important SAP modules offered to enterprises. The controlling module supports in the process works of planning, reporting and monitoring operations of businesses. It involves methods to view and organize costs that are required for financial reporting. Controlling module enables one to plan, track, perform and report about costs. Controlling includes managing and configuring master data that covers cost elements, cost centers, profit centers, internal orders, and functional area and so on.

SAP FICO (Finance and Controlling) is one of the most widely used SAP modules that include finance, controlling, and accounting concepts.

Anyone looking to start a career in SAP FICO or planning to become an SAP FICO consultant, there is a quick need to learn all essential concepts in SAP FI and SAP CO module.

You also need to learn how the SAP FICO module can be used for reporting either internally or externally.

The objective of this module is to record financial transactions within an organization that seems accurate at the end of the trading period.

Further, the SAP FI module is divided into various sub-modules like accounts receivables, accounts payables, asset accounting, general ledger accounting, and bank accounting.

These various sub-modules are interconnected in real-time. It is possible to extract trial balance anytime when you need it.

Here is a quick diagram for the SAP FICO module and how are various sub-modules interconnected, for your reference.

So, it is clear that you must have a sound idea of all essential concepts to enter the SAP FICO space.

SAP stands for System Application and Products in Data processing. SAP is a leading ERP (Enterprise Resource Planning) Because of its liberal open architecture, there are millions of programmers working around the world to provide interaction between thousands of major software and SAP. SAP is usually implemented in phases. The first phase is when organizational structure and accounting components are configured, tested and then taken live. Gradually more modules are turned on.

SAP FICO stands for FI( Financial accounting) and CO( Controlling). SAP FICO is an important module of SAP ERP.

SAP FI & CO both are separate modules of SAP and both the modules stores the financial transactions data.

SAP FI is a module used for reporting both externally and internally. The objective is to record all financial transactions that are posted by an entity and produce financial statements which are accurate at the end of the trading period.

SAP FI module Covers following contents –

• Organization Structure
• Financial Accounting Global Settings
• General Ledger
• Tax Configuration
• Accounts Payable
• Accounts Receivable
• Bank Accounting
• Treasure management
• Asset accounting
• Investment Management

These are the sub- modules of FI

The Controlling (CO) module of SAP provides information to managers & decision makers to understand where the company’s money is being spent. It not restricted by any legal requirements as in case of FI & is essentially an internal cost accounting tool.

SAP CO module covers following contents –

• Cost Element Accounting
• Cost Controlling
• Cost Center Accounting
• Internal Orders
• Activity Based Costing
• Product Cost Controlling
• Profitability Analysis
• Profit Center Accounting

These are the sub- modules of CO.

SAP FICO is a course in which other modules like Sales & Distribution(SD), Human Resource(HR), Material Management(MM) has an integration.

SAP FICO is the Finance and Cost controlling module in SAP ERP where FI stands for Financial Accounting and CO stands for Controlling. SAP FICO module is very robust and covers almost all business process encountered in various industries. It is one of the very important and widely implemented modules in SAP. It is a core module of ERP processes, wherein real-time financial transactions are integrated with various parallel SAP modules for best results.

Some important features and benefits of using SAP FI CO are:

• SAO FI offers some of the most essential components for diverse SAP implementations.
• SAP FI (Financial Accounting) is an effective tool for reliable, accurate and time based external reporting in the form of Profit and Loss statements, Balance Sheets and so forth.
• Other SAP modules like SAP SD (Sales and Distribution), MM (Materials Management), PS (Project Systems), PM (Plant Maintenance) and SAP PP (Production Planning) integrate well with SAP FICO and provide it with postings in a consistent way. These benefits of SAP FI CO are being utilized by applications in most organizations, globally.
• All accounts-relevant transactions are generated in Logistics (LO) and are posted in real-time to Financial Accounting modules through automatic account determination techniques. All this data is also capable of being passed on to Controlling (CO).