03 Organization Structure c

8/8/2019 03 Organization Structure c

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Design Phase

Financial

Organizational

Structure


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2

2

Workshop Objectives

SAP Organizational Concepts

Financial Organizational Structures and key Master Data

Action Items- Next Steps


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3

What is SAP?

Started in 1972 by five former IBM employees in

Mannheim, Germany

The original name for SAP was German: Systeme,

Anwendungen, Produkte, German for "Systems

Applications and Products."

The original SAP idea was to provide customers with the

ability to interact with a common corporate database for acomprehensive range of applications

Gradually, the applications have been assembled and

today many organizations are using SAP products to run

their own operations


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4

The SAP System: Modularity and Integration

Integration - Integrity - Standardization - Accountability

SAPs perhaps most

important benefit:

INTEGRATION

Components or solutions

in SAP are real-time

integrated

This increases users

efficiency significantly,

because data only needs

to be entered one time,

you can re-use data, you

have high data validityand so on. . . .

Banking

Banking

Externalreporting

Externalreporting

Avail

Control

Avail

Control

CO

Cost

Centers

CO

Cost

Centers

CO

Orders

CO

Orders

CO

GL

AA

PS

FM

GM

MMInventory

MMInventory

SDMM

Purchasing

MM

Purchasing

Payroll

Payroll

Travel

Mgmt.

TV

TravelMgmt.

TV

MM

HR

AP

AR

TR

Cash

Flow

Cash

Flow

Main Menu


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SAP Data structure

Drives the fundamentaldata framework within theSAP system

SAPs static informationaland processing data

Tasks which

combine to formintegratedbusiness processes

Master Data

Transactions

Org

Structure

SAPClient

IMG

G/L AccountTransaction

CONFIGURATION SIDE

FUNCTIONAL SIDE


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SAP Hierarchy - Generic Example

Client

ControllingArea

ControllingArea

CompanyCode CompanyCode

SalesOrganization

PurchaseOrganization

Plant

BusinessArea

CompanyCode

SalesOrganization

PurchaseOrganization

DistributionChannel

Plant

Division

BusinessArea


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The Client

Instance

Client Client

CompanyCode

CompanyCode

CompanyCode

Definition The highest level in the organization

structure

All areas of an organization that are to

be integrated into the SAP system

production system should be included

under one client

Relationships A clientcontains one or more company

codes

At least one clientmust exist for each

database instance


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FINANCIAL ORGANIZATIONAL STRUCTURE


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Financial Accounting

Client

Chart ofAccounts

CompanyCode

Businessarea

Highest level organizational entity in the SAP system

Smallest legal independent unit responsible for BalanceSheet and Profit & Loss reporting.Assigned to a Chart of Account.

Optional organizational unit designed for internal reporting.

Does not produce a complete Balance Sheet.Available to all companies within one client.

Chart of accounts contains a listing of all General Ledgeraccounts.Assigned to one or more companies.


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Financial Organizational Structure

CompanyCode

Highest organizational structure for financial accounting and control

purposes. A company code is an independent unit that represents a legalentity or balanced set of books.

All structures within a company code have similar financial processes and

use the same chart of accounts. Only use ONE company code.

Highest organizational structure for financial accounting and control

purposes. A company code is an independent unit that represents a legalentity or balanced set of books.

All structures within a company code have similar financial processes and

use the same chart of accounts. Only use ONE company code.

All transactions relating to a given legal entity are recorded referencing the company code

representing that legal entity

Company code is a level at which you can produce auditable financial statements (P&L,

balance sheet with complete retained earnings)

A company code is assigned to one chart of account

The Chart of accounts represents the Object codes of the current Client X GL account

string.

FI

Businessarea

Represent separate, high-level areas of operation and responsibility within

an organization. These are agencies, lines of business, or locations where

complete (or even partial) financial statements may be required. This

element is under evaluation from Client X

Represent separate, high-level areas of operation and responsibility within

an organization. These are agencies, lines of business, or locations wherecomplete (or even partial) financial statements may be required. This

element is under evaluation from Client X

IMG


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Client X Object / GL Account Preliminary AnalysisFI

0100 5390 9181 7760 7760

1112 PETTY CASH

1131 ACCOUNTS RECEIVABLE

1132 ACCTS REC-ACCRUAL

1310 LAND

4190 OTHER FEDERAL DIRECT

5672 LANDSCAPE REPAIR

5673 DISASTER PROF FEES TREE R

5680 REMODELING

1112 PETTY CASH

1131 ACCOUNTS RECEIVABLE

1132 ACCTS REC-ACCRUAL

1310 LAND

4190 OTHER FEDERAL DIRECT

5672 LANDSCAPE REPAIR

5673 DISASTER PROF FEES TREE R

5680 REMODELING

ALL GL accounts must be analyzed

taking into account Financial

Statements and Budget Control Needs.

Integration with HR/Payroll


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Financial Accounting & Controlling

Client

Chart ofAccounts

Chart ofAccounts

ControllingArea

CompanyCode

CompanyCode

ControllingArea

Businessarea

Businessarea

Businessarea

CompanyCode

Businessarea

Businessarea


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Financial Organizational Structure

ControllingArea

Controlling area is the umbrella in which expense management activities

are performed. Controls boundaries in cost center accounting.The controlling area is an organizational unit delimiting the company's

managerial accounting operations

Controlling area is the umbrella in which expense management activities

are performed. Controls boundaries in cost center accounting.The controlling area is an organizational unit delimiting the company's

managerial accounting operations

Acts as the boundary for the cost centers and hierarchies as the may object for expense

controlThe cost center is the smallest unit of responsibility within a company and is

embedded in the company's overall organizational structure.

The cost centers are grouped together in decision, control, and responsibility units.

The main cost center group is called Standard Hierarchy

Additionally, Internal orders orprojects (WBS elements) can be used as expense

objects. These are used to monitor the costs of a time restricted job.

G/L Accounts are defined as Cost Elements in Controlling.

Cost Elements are organized in Groups for reporting

CO


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Cost center structure: ExampleCO

Region

Sewer Police

LocationCity

CenterLocation

District

7

District

8

District

1

District

19

District

24

District

38

District

37

Accounting

Maintenance

Citizen Center

Transit

Public Safety

Main

Line

Region

1

Region

2

Region

3

Projects

Engineering

Maintenance

Cost Ctr Hierarchy


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Client X Location Cost Center Preliminary Analysis

0100 5390 9181 7760 7760

9015 14 BUILDING OPERATIONS

9016 02 MANAGEMENT PROJECTS

9022 12 LABOR RELATIONS

9035 07 BUILDING OPERATIONS II

9126 13 TREASURER

9127 13 OFFICE OF FINANCIAL OPERATION

9128 13 FINANCIAL OPS/BUDGET

9129 13 GENERAL ACCOUNTING

9130 12 BUSINESS OPERATIONS

9131 20 MANAGEMENT & COMPLIANCE AUDIT

9132 20 AUDIT & INVESTIGATIVE AFFAIRS

9135 03 NORTHWEST REGIONAL TRANS CTR

9141 13 ACCOUNTS PAYABLE

9151 13 CONTROLLER

9015 14 BUILDING OPERATIONS

9016 02 MANAGEMENT PROJECTS

9022 12 LABOR RELATIONS

9035 07 BUILDING OPERATIONS II

9126 13 TREASURER

9127 13 OFFICE OF FINANCIAL OPERATION

9128 13 FINANCIAL OPS/BUDGET

9129 13 GENERAL ACCOUNTING

9130 12 BUSINESS OPERATIONS

9131 20 MANAGEMENT & COMPLIANCE AUDIT

9132 20 AUDIT & INVESTIGATIVE AFFAIRS

9135 03 NORTHWEST REGIONAL TRANS CTR

9141 13 ACCOUNTS PAYABLE

9151 13 CONTROLLER

CO

ALL location codes must be analyzed

for Internal reporting and Budget

Control Needs. Integration with

HR/Payroll is necessary.


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Financial Organizational Structure - FM

FMArea

The FM area is derived from Financial Accounting organizational unit, the

Company Code by assigning the company code relevant for FundsManagement in your organization to an FM area.

The FM area is derived from Financial Accounting organizational unit, the

Company Code by assigning the company code relevant for FundsManagement in your organization to an FM area.

The FM area provides a boundary for budgeting processing

Acts as the boundary for the Funds, Commitment Items and Fund Centers and

corresponding Hierarchies

The Funds within a FM area represent funds which are limited as to time available or

function, which have been made available to cover specific expenditures..

Commitment items classify budget transactions and business transactions affecting

liquidity into revenue, expenditure, and cash balance items. Commitment items in

Funds Management are arranged in hierarchies.

The Fund Centerwithin an FM area represents the structure of an organization(areas of responsibility, departments, projects) in the form of a hierarchy.

The Funded Program within an FM area A program within Funds Management with

an operational purpose and a defined time frame. Funded programs enable you to

record budget, control postings, and monitor the performance of internal projects

The Functional area is an additional dimension in FM used to manage budget

according to the different missions of the organization

FM


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Master Data Relationship

GL AcctSponsor

Class

Cost

ElementCommitmen

t Item

Business

Area

IO/WBS

Cost

Center

Funded

Program

Fund

CenterSponsore

d Program(combination

of Fund

Center,

Funded

Program and

Functional

Area)Functional Area

Fund (Internal)

Grant

Fund

(External

)

CompanyCodeControlling

AreaFM Area

Ma

sterData

Or

g.

Struc.


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Master Data Relationship Overview at Client X

FI

Financial

Accounting

(external accounting)

GM

Grantee

Management

(sponsors view/reportingrequirements)

FM

Funds Management

(budgetary accounting)

CO

Controlling

(managerial/costaccounting)

GL Account

Grant

Functional Area

Business Area

Fund

Fiscal Year

Cost Element

Primary &Secondary

Grant

Functional Area

Internal OrderWBS Element

Cost Center

Fund

Fiscal Year

CommitmentItem

Grant

Functional Area

Funded Program

Funds Center

Fund

Fiscal Year

Sponsor Class

Grant

SponsoredProgram

Fund

Budget Validity

Period

Object

Grant

Location

Function

Fund

MSAF

Program &

Project


19/221919

Financial Organizational Structures Overview

FI- Financial

AccountingCO Management

Accounting

GM -Grants

Management

FM - Funds

Management

UserInterface

External Accounting Internal Accounting

Grants AccountingBudgetary Accounting

General Ledger

Accounts Payable

Accounts receivables

Asset Accounting

Bank Accounting

Cost centers

Cost Elements

Internal Orders

WBS elements

Bank Accounting

Fund .

Fund center .

Commitment Items .

Functional Areas .

Funded Programs

Sponsor Class

FundSponsored Program

Grants


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ACTION ITEMS NEXT STEPS


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Action Items Next Steps

Organize project team / responsibilities

Allocation of Resources to research & analyze

Understand the Design project methodology and tools

Kick off meeting

Industry print and Thread Manager training

Deliverables and Time-line

Plan work sessions with SMAs

Develop system design - 90/10 goal

Prepare for workshop

Reports

System Maps Interfaces

Transaction Lists

Roles

Master Data: GL accounts, locations, Funds, Grants, Funded Programs, etc.


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Preparations for GL and Cost Center workshops

GL Accounts

Client X Object Code map with Governing Body Red Book Analyze current Reports and Budget structure

Check integration with Payroll (Account assignment / Wage Types)

Analyze differences and map with SAP functionality

Define Preliminary Chart of Accounts

Cost Centers Analyze Client X Location Codes

Check Integration with HR/Payroll: Organizational structure

Analyze Budget Structure (Budget controlled at department level)

Map with SAP functionality

Define Preliminary Cost Center Structure

03 Organization Structure c

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