Administration Class Notes_127495368-SAP-FI-CO-Notes

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SAP FI Module IntroductionCompany/Business AreaWhy and When to use Business AreaWhy and When to use Business AreaBusiness Areas in SAP are used to differentiate transactions originating from differentpoints/lines/locations in business. Let me give some examples to elucidiate:-A company (say, ABC) is a huge company and has a variety of businesses under it. Let us saythat it typically operates in 3 different domains like machinery manufacturing, trading andassembling of machine parts.There are 2 options here now 1. Either create different company codes for the 3 business operations (which would be theeasiest and require no creativity)or2.) Create each of these business lines into business areas (the better option).The advantages of using the second option is:1. You can use these business areas if other company codes require the same areas2. The configuration is simpler as in case of company code, you would require to go through theentire configuration of creating Chart of Accounts, Fiscal Year variants, posting periods variantsand so on. In the business area option, you just need to attach it to the company code and therest of the details in Business area is attached by default from the company code you are usingit in.3. Using the options in controlling (EC-PCA, Enterprise Controlling, Profit Centre Accounting),you can even draw up Balance Sheets and PL statements for your business areas and hence thisis used for management accounting in some co

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