What is Valuation Area and Valuation Class?

What is Valuation Area? How is it linked with Valuation Class? What is the significance of Valuation Area?

Valuation areas are nothing but the level at which you want to valuate your materials. SAP provides two levels of valuation Plant level and company code level.

For example:

Valuation at plant level: Suppose you have two plants one in Hissar and one in Andhra Pradesh, Then of course you would like to valuate the rawmaterials at plant level as because you have got transportation cost and taxes etc to account for.

Valuation at company code level:Here you valuate all your material in same way.

In One client valuation areas can either be set to plant level or company code level. Once you have made this setting this cant be changed

Valuation classes are linked to valuation class in Tcode OBYC

If your valuation area is at plant level then in OBYC you will find a coloumn for Valuation modifier you can provide your plant there.

For example:

Valuation Mod Valuation class Account
plant 1 3000 200130

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Explain The Difference In Currency

Explain the difference between group currency, parellel currency, hard currency and index based currency. Explain the context in which we use these.

Definition for different currencies:

Object currency - CO - A currency defined in the master record of a Controlling object (cost center, internal order, and so on). When you create a Controlling object, the controlling area currency is defaulted as the object currency. You can change this.

Transaction Currency - the currency in which a business transaction is processed and booked. The business transaction can be posted in the transaction currency as well as in the local currency. This can occur when the trading partners use different local currencies. The transaction currency can differ from the controlling area currency and the object currency. The SAP system can perform currency translations using a predefined average exchange rate.

Hard currency - Hard Currencies are used in countries with high inflation to improve the value of transaction. When a hard currency is selected, the document is automatically updated in the local currency and the hard currency. The config for hard currency is done at the country level

Group Currency - Group currencies are defined at the client level in table T000. Group currencies are used to enable cross-company postings in controlling for company codes that use different company code currencies.

Index –Based Currency - Index based currencies are used for statutory reporting purposes for subsidiaries in some countries that have an extreme amount of inflation.

Parallel currency - For company code, we may have one local currency and up to two parallel currencies in the system. All documents are posted in both the local and parallel currencies. A hard currency is one type of parallel currency.

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Fatest Way to create company code : Meaning and Creation of Company codes

Which is the best method to create a company code.
- copy an existing company code or copying from country templates.

What is the process involved in copying from a country template.


For configuring SAP, generally three steps are required

1) create company name and address
2) creation of company code
3) currency and country setting
4) Assign company code to company

In same organisation i.e. in one company more than two company codes are maintaing, then its better to copy from other company code from ec01, later on you can customised/change specific settings according to client requirements.

If your want seperate setting in your own company code, that time its better to configure by creation rather than copy

In above that is your choice and need for reqirement.

Otherwise you can upload certain data by creating company code.

Company - A company is a legal entity or a organisation which is to carry out a business and under a company you have lot of sub companies.

For Example
Tata is a company
TCS,Tata Power,Tata Steel, is a company code under a company TATA
Under Company code you have business area associated with it where the business areas may be scattered in different parts of the world where you can have reporting done for different business area or you can also call it as Profit Centre.

A company is the Group of company and company code is the all the companies for which u want seperate books of accounts. Company codes are assigned to company for consolidation purpose.

example :- reliance is the company

and RIL,Reliance infocomm,Reliance Petrochem etc are the company codes.

All these co.codes are assigned to reliance company for consolidation purpose.

Along with that technical difference is COMPANY cosists of 6 digit alphanumeric key where as COMPANY CODE cosists of 4 digit alphanumeric key.

Company means group company for example : Tata Group

Company code means one of the company of its group ex:
Tata Chemicals, TCS, Tata Steels etc.

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SAP FI : When to use the business area and Why?

Business Areas in SAP are used to differentiate transactions originating from different points/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 say that it typically operates in 3 different domains like machinery manufacturing, trading and assembling of machine parts.

There are 2 options here now -
1. Either create different company codes for the 3 business operations (which would be the easiest and require no creativity)

or

2.) 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 areas
2. The configuration is simpler as in case of company code, you would require to go through the entire configuration of creating Chart of Accounts, Fiscal Year variants, posting periods variants and so on. In the business area option, you just need to attach it to the company code and the rest of the details in Business area is attached by default from the company code you are using it 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 this is used for management accounting in some companies (like HP, Dell, etc) when it wants to know the operating profits for different business areas/lines.

The above was an example when the company wanted to separate entries according to the lines it operates in... the other case could be when it wants to find out profitability during its operations in cities and differentiates these cities into Business
Areas...

Business Areas are not much relevant in FI but are much more relevant in CO.

1) You want the B/S and P/L statements of transactions carried out in areas other than the business areas defined by you? or

2) You only want to view the transactions that were not carried out in any business area?

Whatever were your doubts, let me clarify.

If your doubt was the first one, then, in that case, the financial statements will not be available. There are reasons for the same. All transactions in FI pass through G/L accounts. The data in FI is then passed to CO through primary cost elements.
According to the settings that you have configured for your controlling area and operating concern, the costs are distributed to the various cost centers (Cost Center Accounting & CO-PA). The costs are then apportioned to the various cost centers (which may or may not be a part of your business areas or may be independent cost centers). Now, with this data, financial statements of the business area are drawn up. For transactions not part of business area, they are transferred to independent cost centers (e.g. like Head Office Salaries, HR, etc) and hence, cannot be drawn up as a financial statement but just as line item displays in your reconciliation ledger (if you have activated it in the CO-OM-CEL {Cost Element Accounting})

Financial statements of Business areas are unbalanced because not always does the debit and credit entries of a transaction lie in the same business area/cost center; but for cost accounting purposes, they are reasonably sufficient.

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ABAP Tips - Help Guide

On request from our regular visitors. From this edition (Today), I am going to provide you a complete list of ABAP TIPS and GUIDE in a ZIP Format and easy to download and read at your convenience.

This is made for your convenience.

ABAP Tips - Click to Download

Hope you all appreciate. - If YES, Leave your comments. Which will encourage me further.

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Selecting Sessions and Reading the Session Display

Use

The heart of the tool for managing batch input sessions is the session list. The management tool offers lists by status, and you can select lists according to other criteria as well.

Prerequisites

Start the batch input management tool: Select System ® Service ® Batch input ® Sessions. Alternate: Enter transaction SM35. Both paths take you to the session overview of the batch input system. transaction SM35.

Procedure

On the main menu, you can select sessions using any or all of the following criteria:

* session name

* date on which the session was generated (entered into the session queue)
* user who generated a session

* session status

In the session overview, you can start, analyze, or delete sessions in the queue. You can also display statistics on the transactions in a session and view the session log. All sessions generate a log when they are run. From the session log display, you can take further actions, such as displaying more information on the messages in a log.

Reading The Session Queue

The information in the session queue includes the following:

* Creator:The user who generated the session.

* Date and Time:
The date and time when a session was generated (entered in the session queue).

* Lock date:If a session is locked, this column shows the date upon which the system will release the session. A locked session cannot be started.
* Authorizations user: The user under whose authorizations the transactions in a session are to be run. When the session is run, it can execute only those transactions and functions for which this user has authorizations.
* Status: The status of a session (new, processed, contains errors, as shown in the tabs in the overview).

* Tran. and Screen: The number of transactions and screens, respectively in a session.

You can display statistics on the transactions in any session by marking the session and using the Statistics function.

Session Sorting and Status

Sessions in the session queue are sorted by date and time of generation and are grouped in different lists according to their status.

Possible statuses are as follows:

* new and not yet processed

The Tran. and Screen fields in the display show how many transactions and screens, respectively, the session contains.

* held in the session queue because of errors in transactions (Errors in sessions)

Transactions that contained errors are aborted; all correct transactions are processed. The Tran. and Screen fields in the session display show how many incorrect transactions were found in the session.

You can restart a session and correct the erroneous transactions with one of the interactive execution modes offered by the batch input system. For more information, please see Correcting a Session.

* processed

For further information on a session that has been successfully run, you can display the log generated by the session. All completed sessions generate a log. You cannot run a completed session a second time.

Only sessions that were generated with the KEEP option are held in the queue after processing. Other sessions are deleted after they are successfully completed.

* in generation

You will usually see this status only if you happen to display the queue while a session is being generated (entered into the session queue).

You can also encounter this status if a system failure has interrupted the generation of a session. If you suspect that a session has been interrupted, please see Releasing and Restarting an Interrupted Session for more information.

* in process

You will usually see this status only if you happen to display the queue while a session is being run.

You can also encounter this status if a system failure has interrupted the execution of a session. If you suspect that a session has been interrupted, please see Releasing and Restarting an Interrupted Session for more information.

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Batch Input Sessions : Processing Sessions Automatically

Use

In most cases, batch input sessions can be processed automatically. It is not necessary for a session to wait until a system administrator explicitly starts the processing of the session.

This section explains how to have sessions started automatically soon after the session has been generated in an R/3 System.


Prerequisites

The ABAP program RSBDCSUB must be scheduled as a periodic job in the R/3 background processing system. RSBDCSUB checks for and starts any batch input sessions that have not yet been run. It schedules such sessions for immediate execution in the background processing system.

Procedure

Schedule RSBDCSUB to run periodically in one or more background jobs.

If you have regularly scheduled batch input runs, you can schedule separate jobs for each of the scheduled data transfers. The start time for the RSBDCSUB job can be set according to the batch input schedule. And you can use a variant to restrict RSBDCSUB only to the batch input sessions that you expect.

With RSBDCSUB, you can use all of the selection criteria offered on the batch input main menu to select sessions to run:

* session name

* date and time of generation

* status: ready to run or held in the queue because of errors

Result

Batch input sessions are started automatically rather than by hand. The RSBDCSUB program can be set up to start all sessions that arrive in an R/3 System, or it can be fine-tuned to start only batch input sessions that you expect.

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