SAP FICO Interview Questions And Answers-Part 2

05 September, 2020


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Are you planning to attend an interview for the SAP FICO Developer role but confused on how to crack that interview and also what would be the most probable SAP FICO Interview Questions that the interviewer may ask? Well, you have reached the right place. Tekslate has collected the most frequently asked SAP FICO Interview Questions which are often asked in multiple interviews.

Q1) Explain the term SAP FICO?

Ans: SAP FICO stands for FI ( Financial Accounting) and CO (controlling).  In SAP FICO, SAP FI takes care of accounting, preparation of financial statements, tax computations, etc, while SAP CO takes care of inter orders, cost sheet, inventory sheet, cost allocations, etc. It is the software that stores data, and also computes them and retrieves the result based on the current marketing scenario. SAP FICO prevents data loss and also does the verification and reporting of data.

Q2) Why do we use SAP FI?

Ans: SAP Financials accounting module enables you to manage financial accounting data within an international framework of multiple companies, currencies, and languages. SAP FI module mainly deals with the below financial components.

  • Fixed asset
  • Accrual
  • Cash journal
  • Accounts receivable and payable
  • Inventory
  • Tax accounting
  • General ledger
  • Fast close functions
  • Financial statements
  • Parallel valuations
  • Master data governance

Q3) What is the use of Account Receivables in FI?

Ans: SAP FI Accounts Receivable component records and manages accounting data of all customers. It is also an integral part of sales management.

All postings in Accounts Receivable are also recorded directly in General Ledger. Different G/L accounts are updated depending on the transaction involved (for example, receivables, down payments, and bills of exchange).

Q4) Explain the relationship between company code and controlling area?

Ans: A controlling area may include one or more company codes that must use the same operative chart of accounts as the controlling area. A Controlling Area can contain multiple company code assignments but a single company code can be assigned to only one controlling area.

Q5) What is the use of Sales returns in FI?

Ans: Sales Returns in SAP FI is used to manage full products that the customer has returned due to a complaint. These are used in the consumer good industry.

All returns are related to quality defects and not incorrect deliveries. The path that the returned merchandise takes often has to be tracked in detail. The returned item has to be sent for inspection.

Q6) What is the controlling area?

Ans: The Controlling Area is the central organizational unit within the CO module. It is representative of a contained Cost Accounting envt where costs and revenues can be managed.

Q7) Define the relationship between controlling area and company code?

Ans: A controlling area may include one or more company codes that must use the same operative chart of accounts as the controlling area. A Controlling Area can contain multiple company code assignments but a single company code can be assigned to only one controlling area.

Q8) What is a fiscal year variant?

Ans: Fiscal Year is a period of 12 months and SAP provides 4 special periods to posting adjustment Entries. The fiscal year determines the posting periods. Posting periods are used to assign business transactions. The fiscal year may be year dependent or year independent.

Q9) What are the special periods used for?

Ans: The Special periods in a fiscal year variant can be used for things like posting audit or tax adjustments to a closed fiscal year.

Q10) What are document types and what are they used for?

Ans: The document type is the identifier of different account transactions like SA for G/L,AA for Asset Accounting, etc. The doc. Types control things like the type of the account that can be posted to, the number range assigned to it, and required doc header fields.

Q11) What are the posting keys? State the purpose of defining posting keys?

Ans: Posting keys determine whether a line item entry is a debit or a credit as well as the possible field status for the transaction. Posting keys are SAP delivered. If u want changes like making additional fields optional on payment type posting keys then the best possible action is to copy the posting key that needs to be modified and then modify it.

Q12) In SAP FI what are the organizational elements?

Ans: The organizational elements in SAP FI are:

  • Company Code
  • Business Area
  • Chart of Account
  • Functional Area

Q13) What is the company code in SAP?

Ans: To generate financial statements like Profit and Loss Statement, Balance sheets, etc. company code is used.

Q14) In SAP how input and output taxes are taken care of?

Ans: For each country, tax procedure is defined, and tax codes are defined within this.  There is a flexibility to either expense out the Tax amounts or capitalist the same to stocks.


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Q15) What are the application areas that use validation and substitutions?


  • FI- Financial accounting
  • CO-Cost accounting
  • AM-Asset accounting
  • GL-Special purpose ledger
  • CS-Consolidation
  • PS-Project system
  • RE-Real estate
  • PC-Profit center accounting

Q16) How can you create a Credit Control Area in SAP?

Ans: By using transaction code OB45 or path you can create Credit Control Area in SAP

SPRO> enterprise structure >maintain structure>definition>financial accounting>maintain credit control area and then enter the following description


Q17) Name of the credit-control area in SAP


  • Currency
  • Description
  • Credit Limit
  • Risk Category
  • Fiscal Variant
  • Rep group

Q18) What is the short-end fiscal year?

Ans: A short-end fiscal year results when you change from a normal fiscal year to a non-calendar fiscal year, or the other way around. This type of change happens when an enterprise becomes part of a new co-corporate group.

Q19) What is the purpose of “Document type” in SAP?

Ans: The purpose of “ Document type” in SAP is

The number range for documents are defined by it

Types of accounts that can be posted are controlled by it, e.g Assets, Vendor, Customer, Normal GL account

It is used for the reversal of entries

Q20) How are tolerances for invoice verification defined?

Ans: Tolerance determines whether the payable places matching or tax hold on the invoice. The following are the instances of tolerance that can be defined for Logistic Invoice Verification.

  • Small differences
  • Moving average price variances
  • Quantity variances
  • Price variances

Q21) What is APP in SAP Fico?

Ans: PP stands for the ‘Automatic Payment Program’; it is a tool provided by SAP to companies to pay its vendors and customers.  APP tools help to avoid any mistakes taken place in posting manually. Also, when the number of employees is more in the company, payment through APP becomes more feasible.

Q22) In SAP FICO what are the terms of payment and where are they stored?

Ans: Payment terms are created in the configuration and determine the payment due date for vendor/customer invoice.

They are stored on the customer or vendor master record and are pulled through onto the customer/vendor invoice postings.  The due date can be changed on each individual invoice if required.

Q23) How capital WIP (Work In Process) and Assets accounted for in SAP?

Ans: ‘Capital WIP’ is referred to as Assets under construction in SAP and is represented under specific asset class.  Depreciation is not charged under ‘Capital WIP’ usually.  The cost incurred on building a capital asset can be booked to an ‘internal order’ and through the settlement procedures, and can be posted onto an ‘Asset Under Construction’.

Q24) What is “dunning” in SAP?

Ans: ‘Dunning’ is the process by which payment chasing letters are issued to customers.  SAP can determine which customers should receive the letters and for which overdue items.  Different letters can be printed in SAP depending on the overdue payment date, with a simple reminder.  With the help of a dunning level on the customer master, we can know which letter has been issued to the customer.

Q25) What is a ‘Value Field’ in the CO-PA module?

Ans: Value fields are number or value related fields in profitability analysis such as quantity, sales revenue, discount value, etc.

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