SAP FICO System Assessment Summary of RL Steel Pvt Ltd

Assessment
Module Key Checks Key Findings Remarks
Area
Configured correctly with
Ensure correct
one chart of accounts one
General Chart of configuration and Properly
company code, ensuring
Ledger (GL) Accounts assignment to structured
consistency and streamlined
company codes.
reporting across entities.
Fiscal year variant is aligned
Verify fiscal year with the Indian financial
Fiscal Year Meets
settings and posting year (April–March),
Variant requirements
period control. ensuring compliance with
statutory reporting.
Document splitting is
Ensure
currently segment-based,
configuration for
Document which does not align with Change
profit centre-based
Splitting profit centre reporting needs required
reporting instead of
for accurate financial
segment-based.
insights.
Number ranges are properly
Number Validate assignment assigned and maintained on Well
Ranges and consistency. a yearly basis, ensuring no maintained
overlaps or inconsistencies.
Maintain Exchange rates are not
Foreign daily/periodic maintained daily or Requires
Currency exchange rates for periodically, users directly immediate
Valuation accurate financial maintained in the action
reporting. documents header.
Financial statement
Activate cash flow mapping is correct, but the
Financial
statements for cash flow statement is Should be
Statement
enhanced financial inactive, limiting the ability activated
Versions (FSV)
insights. to track cash movements
effectively.
Vendor master data lacks
Implement dual
dual authorization for
Accounts Vendor Master authorization for Potential
sensitive fields, increasing
Payable (AP) Data sensitive fields to security risk
the risk of unauthorized
security risks.
changes
Enforce SAP-
It’s seems all payment terms
defined payment Needs
Payment Terms need to revisited & need to
terms to ensure alignment
be defined
consistency.
 Assessment
Module Key Checks Key Findings Remarks
Area

Tax codes and yearly

Ensure correct tax thresholds are correctly
Withholding Meets
codes, rates, and maintained, ensuring
Tax (TDS) requirements
reporting. compliance with statutory
requirements.
Aging reports are deployed,
Implement invoice
but the absence of an
Vendor vs. payment report Needs
invoice vs. payment report
Reconciliation for complete implementation
hinders full reconciliation of
reconciliation.
vendor balances.
Customer master data lacks
Establish dual dual authorization for
Accounts
Customer authorization for sensitive fields, Security
Receivable
Master Data sensitive fields to Like reconciliation a/c, Pan concern
(AR)
enhance security. number
Bank account details.
Credit management settings
Activate credit are inactive, exposing the
Credit management to business to potential Financial risk
Management reduce financial financial risks due to exposure
risks. unchecked customer credit
limits.
The dunning procedure is
Implement dunning not implemented, resulting
Delays in
Dunning procedure for in delays and inefficiencies
payment
Procedure streamlined follow- in follow-ups for overdue
follow-ups
ups. customer payments through
SAP standard programme.
Bank
Ensure accuracy in
Reconciliation Bank reconciliation through Underutilized
bank reconciliation
(Lockbox SAP is not used, feature
if applicable.
Processing)
Asset master data is
Ensure asset master maintained correctly but
Asset
Asset Master data includes scrap lack information on scrap
Accounting Requires update
Data value and value and percentage, which
(AA)
percentage. is essential for accurate
depreciation calculations.
Depreciation Review income tax Income tax depreciation Incomplete
 Assessment
Module Key Checks Key Findings Remarks
Area
keys is not used in the
depreciation for
system, resulting in
statutory compliance
incomplete compliance with
compliance.
statutory requirements.
Validate disposal Disposal processes are
Asset
processes and implemented correctly,
Retirement & Well managed
gain/loss including accurate gain/loss
Disposal
calculations. calculations.
Ensure asset Asset balances are
Reconciliation balances match reconciled accurately with
Accurate
with GL general ledger the general ledger, ensuring
accounts. data integrity.
There are 14 profit centres
Reduce profit
assigned, although only 6 Can be
Controlling Cost Centres & centres from 14 to
plants exist, creating streamlined if
(CO) Profit Centres match the 6 plants
unnecessary complexity in needed
in operation.
reporting structures.
Internal orders are not
implement internal
implemented, leaving a gap Potential
Internal Orders orders where
in tracking specific project process gap
applicable.
costs and allocations.
If used, ensure
Activity-Based Activity-based costing is
correct cost Efficient
Costing properly configured,
allocation settings.
Validate cost
Cost component structures
component
Product and the material ledger are
structures and Well optimized
Costing streamlined, optimizing
material ledger
product costing processes.
settings.
While GL integration with
Address delays in
Integration MM, SD, and PP is correct,
Integration & standard price Must be
with MM, SD, delays in FG & SFG
Reporting updates for addressed
PP material standard price
improved data flow.
maintained correctly.

Key Recommendations for Improvement

1. Enhance Financial Accuracy

 o Maintain daily/periodic exchange rates.
o Activate cash flow statements for better financial insights.
o Ensure vendor/customer dual authorization for sensitive data fields.
2. Strengthen Compliance & Risk Management
o Implement credit management to reduce financial risk.
o Activate the dunning process to improve collection efficiency.
3. Improve Operational Efficiency
o Shift document splitting to profit centre-based.
o Reduce unnecessary profit centres from 14 to 6.
o Implement invoice vs. payment report for vendor reconciliation.