3.ES Accounting Concepts (4)

3.ES Accounting Concepts (4)

1. 1.Introducing Accounting

   • 1.Accounting Concepts
     • 1.Assets (Resources)
       • 1.Customer accounts(AR - Accounts Receivable)
       • 2.Bank accounts (cash is liquid asset)
       • 3.Inventory
       • 4.Fixed assets
       • 0.Definition - gain from past events
     • 2.Liabilities (obligations)
       • 0.owe from past events
       • 1.GR/IR Accounts for goods received but not invoiced
       • Vendor accounts(AP -Accounts Payable)
   • 2.SAP Financial Accounting Module
     • 1.Purpose - standard portfolio of reports
       • 1.Balance sheets - financial position
         • 1.Assets
         • 2.Liabilities
       • 2.Income statements - comprehensive income
         • 2.Income/revenue
         • 1.Expenses
       • 3.Statements of cash flows

2. 2.Accounting Organisational Structure

   • 1.Client
   • 2.Company Code
   • 3.Charts of Accounts
     • 1.classification scheme has group of G/L accounts
     • 2.Framework for recording values
     • 3.G/L accounts contained used by 1 or more company codes

3. 3.Accounting Master Data

   • 1.General Ledger accounts
     • 1.G/L accounts prepared FI reports and credited/debited
       • 2.Balance sheet accounts
         • Assests and Liabilities
       • 3.Profit and loss accounts
         • Expenses and Income/Revenue
     • 3.Debit
       • 1.On left
       • 2.Increase asset and expense (left accounts)
       • 3.Decrease liability and revenue(right accounts)
   • 2.Postings
     • 1.Goods receipt posting
       • 1.inventory asset debited
       • 2.GR/IR - liability credited
     • 2.Invoice receipt posting
       • 1.GR/IR account debited and AP credited
     • 3.vendor payment posting
       • 0. Bank account credited and AP debited
   • 4.Credit
     • 1.On right
     • 2.increase liability and revenue(right accounts)
     • 3.Decrease asset and expense(left accounts)

4. 4.Accounting Process

   • 1.Inventory Postings
     • 1.Accounting document generated by goods movement contains
       • 1.doc date and posting date
         • g/l account numbers , associated amounts and company codes
     • 2.Goods receipt - increases inventory and increases gr/ir liability
     • 3.Goods issue - decrease inventory and increase cost of good sold (expense)
   • 2.Invoice postings
     • 1.Vendor invoice
       • 1.Increases AP
       • 2.decreases gr/ir account
     • 2.Customer invoice
       • 0.Inceases AR debited and revenue credited
   • 3.Payments postings
     • 1.Vendor Payment
       • 0.decreases AP debited and decreases bank account credited
     • 2.Customer Payment
       • 1.decreases AR credited
       • 2.increases bank account debited