Finance/Controlling Questionnaire

Finance/Controlling Questionnaire
Instructions
This questionnaire is a tool you can use to collect information about your business that will be useful for tailoring the R/3 System to your business needs. You will need Microsoft Word for Windows to work with this document. Enter your answers in the fields after the questions, using the TAB key to move from field to field. You may save and later change your answers in this questionnaire just as you would with any other Word document.

1 Organization Structure
1.1 Company Codes
A company code is an independent accounting unit for which a balanced set of books is produced. It is a legal entity. Balance sheets and Profit and Loss statements are required at the company code level. What are the legal entities that constitute your business? Do you produce a Profit and Loss Statement and a complete Balance Sheet with retained earnings for each legal entity? (If a complete balance sheet including equity section is not produced, then it is not a company.) Does each legal entity have a separate Federal tax ID Number? Which of these entities are true operating companies that transact business at arms length with vendors and customers? Which of these entities are holding companies? What is your percentage of ownership for each legal entity? Does one entity supply customers with
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Yes No

Yes

No

products valued as inventory under another entity so revenue is reported in the selling entity though the cost (inventory) resides in elsewhere? In which currency does each legal entity operate? In which currency does each legal entity report? When does each legal entitys fiscal year begin? For each legal entity, list the number of periods (both accounting and special periods) used. Include the beginning and ending dates for each period.

1.2 Business Areas

A business area is a special economic unit within a company code for which internal balance sheet and profit and loss statements can be created. Are you subject to segment reporting in accordance with FAS14? If your answer is yes, identify your industry segments. If not, do you generate a Profit and Loss Statement including Earnings before Taxes, and a complete balance sheet (exclusive of Retained Earnings) for any component of your company (for example, division)?.

1.3 Chart of Accounts

Does each company code have its own operating chart of accounts with a unique numbering convention, or do all companies use a common chart of accounts with a consistent numbering scheme? If each company has its own operating

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chart of accounts, are you interested in standardizing the charts into a common numbering scheme? If each company has its own operating chart of accounts, are they mapped to a consolidation/corporate chart of accounts for reporting? Are any of the companies required to report in a statutory chart of accounts? (For example, France, Germany, etc.) Do these companies use the statutory chart of accounts as their primary operating chart of accounts (i.e., all posting and account analysis is made using the statutory account code), or do they use the statutory chart for reporting only? Identify the different levels of Consolidation (e.g., by Country, by Region, etc.): Please list the external financial views of your organization by which you would expect to produce complete Profit and Loss Statements and Balance Sheets. (Legal entity, country, regions, continents, etc.) How many general ledger accounts do you currently have? Describe your current general ledger account number (for example, division, cost center, natural account, expense code).

In R/3, the FI general ledger account number consists only of the natural account. Other information resides in different modules. For example, cost centers are defined in CO and are not part of the FI account number. For each company, how detailed is its operating chart of accounts? Is it

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optimized so that detail data (for example, sub-ledger reconciliation account data) is captured via control accounts? If not, please explain why detail information is being captured with the chart of accounts instead of the operational sub modules. (Assumption is that there may be no integration between modules.)

1.4 Consolidation
Identify the current system used to generate consolidated financial statements (e.g., Excel, Hyperion). If you plan to replace the current system with SAP, please complete questions below. Which of your legal entities represent a minority interest? How many monthly elimination entries do you have? Identify any situations where inventory is transferred between companies, such that profit/loss in inventory that has to be eliminated on the consolidated books.

2 Financial Application
2.1 Master Records - GL Accounts
Do your general ledger accounts fall into discrete number ranges (for example, cash accounts are 1000 1999)? Can you define groups of general

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ledger accounts that require similar information on the master record? How do you wish to control general ledger account creation and maintenance? Will it be done at the company level or the corporate level? Do you currently use templates or prototypes to create general ledger accounts? How many retained earnings accounts do you maintain per company code? How many reconciliation (control) accounts do you need for each subledger? Example: Accounts Payable must have at least one reconciliation account in general ledger, but some companies might choose to have more (domestic payables, foreign payables). Do you wish to retain line item detail (open item managed) for every general ledger account? If not, what are the exceptions? Please examine the attached Frame Chart of Accounts. Can this frame be used as a starting point to build your chart of accounts? (The advantage in using the Frame Chart of Accounts is that you will need to make only minor changes to the Automatic Account Determination.)

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2.2 General Ledger Transaction Processing

What types of general ledger transactions do you process? General Journals Recurring Journals Accruals/Deferrals Inter-company transactions Other s: What is the current structure of your general ledger transaction number? How is the number assigned by your current system? Are your transaction numbers specific to fiscal year, or do they flow from year to year? Do you have a need for repetitive or model journal entries? What types of reversing journal entries do you have? Do you calculate interest on any general ledger accounts? Do journal entries require any type of approval before they are posted to the general ledger? Describe your current process for reconciling sub-ledgers (accounts receivable, accounts payable, fixed assets) with your general ledger. Describe any special requirements to posting to particular general ledger accounts (for example, expense accounts require an associated cost center). Internally Incoming payments Outgoing payments Down Payments Bills of exchange

Externally

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Is there information that you wish to require for certain types of journal entries or general ledger accounts? Is there certain information that you wish to be able to display when you view journal entries online? Describe your period-end closing process. What types of daily, weekly, periodic, and ad hoc transaction reports do you need for general ledger? 2.2.1 Closing Operations How do you carry out reconciliation in accounting? Manually Automatically Daily

Weekly Monthly

When do you close current posting period?

Always on same date When required On certain day of next month Date for GL accounting

Date for AR accounting Date for AP accounting

Which evaluations belong to monthend closing?

Balance audit trail Open item list Balance List Advance return for tax on sales and purchases

Balance Sheet Profit and Loss statement

When do you close current fiscal year?

Always on same date

Date for AR

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When required On certain month Date for GL accounting

accounting Date for AP accounting

Which evaluations belong to year-end closing?

Balance audit trail Open item list Balance List Advance return for tax on sales and purchases

Balance Sheet Profit and Loss statement

2.3 Master Records Customers (AR)

How many customer master records do you currently have? What is the current structure of your customer number? Is the number internally assigned by your current system or externally assigned by a user? Do you intend to keep your existing number structure? Are there classifications or groupings currently assigned to your customers (for example, grouping by local customers, foreign customers, government customers)? If there are currently no classifications

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or groupings for your customers, could you create them? If so, what would they be? What types of customer master records are there? Domestic Goods & Invoice recipients Abroad Goods & Invoice recipients Branches / Head Offices Is there any information that you wish to require for certain customers? Do you have any customers who are also vendors? Do you have one-time customers (customers with whom you expect to do business only once)? List the payment terms that you offer your customers (for example, 2% discount if paid within 10 days, net amount due in 30 days). Do you have holdback/retainage agreements with your customers? Do you have agreements with customers which call for installment payments? Have you defined acceptable ranges (tolerances) within which your customer payments can deviate from the amount billed to them? Does your company perform credit management on customers? If so, please describe the credit management process in detail. Do you wish to perform dunning (reminder letters for overdue amounts) for your customers? If so, please list
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Agents / Sales Reps Commission Recipients One-Time Customers Employees

your dunning requirements. Are any security access authorizations needed? Company Related Department Related Personnel Related Master Record Related What criteria are there for deleting a customer master? No open items No transactions for more than 1 year No transactions for 2 years No transactions for 3 years Balance is less than: Other: Field Related Field-Group Related

2.4 Customer Transaction Processing

What types of customer transactions do you process (for example, customer invoices, credit memos, customer payments)? What is the current structure of your transaction numbering? Are your transaction numbers specific to fiscal year, or do they flow from year to year? Are there foreign currency transactions? Do you receive down payments (advance payments) from your customers? Do you charge customers interest on overdue amounts? If yes, is interest calculated on balances or days overdue?

Manually Assigned

Automatically Generated

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Do customer invoices require any type of approval before they are posted to the general ledger? Describe any taxes which must be calculated on customer transactions. Describe your cash receipts process (for example, manual, lock box). Do you receive a single payment for multiple invoices from your customers? How are payments matched to customer invoices? What types of adjustments do you perform on customer invoices (for example, adjustments for defective material, shipping damage)? Is there certain information that you wish to be able to display when you view customer entries online? What types of daily, weekly, periodic, and ad hoc transaction reports do you need for accounts receivable? 2.4.1 Outgoing Invoices How do you compare documents with Sales & Distribution?

Number of documents Total amounts

Other:

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What information do you include in outgoing invoices?

Foreign Currency Payment Terms Tax on sales and purchases Texts Invoice Number Cost Center

PO number Project Personnel number Asset number Tax ID number Dunning indicator
Other:

How do you make account assignments when manually entering invoices or credit memos?

Account assignment stamp Central Account assignment

Local Account assignment in accounting in sales Both

2.4.2 Incoming Payments How do you process incoming payments? What types of payment do you process? Manually Automatically Cash payments Bank Transfers Bills of exchange Other: How do you process payment differences? Difference is charged up to specific amount Residual amount is carried forward Grace period for cash discount deduction in days 2.4.3 Dunning What types of dunning notices do you use? Notices as payment reminders notices with dunning levels account statements Weekly Other

What is dunning frequency?

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Bi-weekly No

Do you dun various customer groups at different intervals? When do you dun an account?

Yes

By due date for net payment when grace period is exceeded

How many dunning levels do you have? Do you calculate dunning charges or interest?

Dunning fees at dunning level Interest at dunning level by dunning level by customer groups Both

Do you vary the text on dunning notices?

2.5 Master Records Vendors (AP)

How many vendor master records do you currently have? What is the current structure of your vendor number? Is it internally assigned by your current system or externally assigned by a user? Do you intend to keep your existing numbering structure? Are there classifications or groupings currently assigned to your vendors (for example, grouping by local vendors, foreign vendors, 1099 vendors)? If there are no classifications or groupings for your vendors, could you define some? If so, what would they

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be? Is there any information that you wish to require for certain vendors? Do you have any vendors who are also customers? Do you have one-time vendors (vendors with whom you expect to do business only once)? List the payment terms that you offer your vendors (for example, 2% discount if paid within 10 days, net amount due in 30 days). Do you have holdback/retainage agreements with your vendors? Do you have agreements with vendors that call for installment payments? Have you defined acceptable ranges (tolerances) within which your vendor payments can deviate from the amount billed to you? Do you always want to take any discounts offered by your vendors?

2.6 Vendor Transaction Processing

What types of vendor transactions are currently being processed (for example, vendor invoices, credit memos, vendor payments). What is the current structure of the transaction number? Is the number internally assigned by your current system, or externally assigned by the user? Are your current transaction numbers specific to fiscal year, or do they flow

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from year to year? Are there foreign currency vendor transactions? Do you make down payments (advance payments) to your vendors? Do vendor invoices require any type of approval before they are posted to the general ledger? Do your vendors charge interest on overdue payments? If yes, is interest calculated on balances or days overdue? Describe any taxes that must be calculated on vendor transactions. Do you issue a single payment for multiple invoices from your vendors? How are payments matched to vendor invoices? Is there certain information that you wish to be able to display when you view vendor entries online? What types of daily, weekly, periodic, and ad hoc transaction reports do you need for accounts payable? 2.6.1 Outgoing Payments How do you pay vendors? Manually Automatically Both Please describe the process: How do you post outgoing payments? To an outgoing payments clearing account per payment method per bank

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per payment method & bank What types of automatic payment do you process? Checks Bank Transfers Postal Transfers Bills of Exchange Elimination w/ affiliated companies Checks/bills of Exchange Bank Transfers Abroad Other:

How often do you make payments?

Daily Once a week Twice a week

Three Times a week Other:

How is the payment method determined for automatic payments?

Indicator in Vendor Master Indicator in Open Item document Depending on Payment Amt. Depending on number of items to be paid

How do you process cash discounts received?

Manual Posting Automatic Posting Additional account assignment to Cost Center of Products

How do you post exchange rate differences in foreign currency payments?

Manual Posting Automatic Posting Additional account assignment to cost center or products When payment is made In bank debit entry of payment

Finance/Controlling Questionnaire

How do you plan funds?

In each payment run by a single bank by several banks

Do you optimize payment methods?

Optimization in bank transfers Optimization in checks No Optimization

How do you process vendor credit memos?

Are Due immediately The value date is set as the due date Can be invoice-related Yes No

How are payment media created? Are down payments paid automatically? Are receivables from a vendor who is also a customer considered during payment? Which evaluations do you have for accounts payable accounting?

Manual Check Automatic Clearing Vendor List List of Account Balances Open Item List

No Clearing

Due Date List Line Item List Account Statement

2.7 Master Records - Banks

Please list the banks with which your company has bank accounts (checking accounts, payroll accounts, lockbox). Please list the bank accounts within each of the above banks. Are any of these accounts held in a foreign currency?

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Do you perform electronic funds transfers with your customers or vendors such that you need to maintain their bank information?

2.8 Taxes
Do you currently have an interface to any third-party tax packages (for example, Vertex or Taxware)? Do you charge sales tax on your sales? If yes, on what types of sales? Please list the States, Counties, Cities and/or Jurisdictions to which you remit sales tax: Do you have any international tax issues on your sales? Are you charged taxes on:

Inventory Items Assets Expense items Services Any others? Please specify:

Do you pay use tax? If yes, please list the states to which you remit use taxes: Do you withhold taxes from your vendor payments? Do you receive Exemption Certificates from your vendors for Withholding Taxes? Do you have 1099 or 1042 Reporting requirements for vendor Withholding Taxes?

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2.9 Currencies
List the local currency (operating currency) for each of your company codes: Do you report in currencies other than the operating currencies of your companies? Do you perform consolidated reporting (grouping more than one companys results) in a different currency? How do you currently maintain your exchange rates? For example, are they manually entered into a table or downloaded from a service such as Dow Jones? What types of exchange rates do you maintain (for example, average rate, bank buying rate, bank selling rate)? Do you enter customer or vendor invoices in foreign currency? If yes, how is the foreign currency rate determined? Do you perform foreign currency revaluations on either account balances (for example, a bank account held in a foreign currency) or open items (unpaid items for customers or vendors)? Describe your foreign currency revaluation process and which valuation methods you use:

2.10 Planning/Budgeting
What type of financial planning/budgeting is currently performed (for example, by company, by cost center, by product line)?

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Please describe your planning process: Do you plan on a monthly, quarterly, half-yearly, or annual basis? How do you distribute planned amounts to individual planning periods (for example, equal distribution among periods, seasonal distribution)? Does your planning take into consideration non-financial (statistical) data?

2.11 Reporting
List the management reports that are currently used: By which organizational units are management reporting functions structured (for example, company, division, product line)? Do you require internal balance sheet or profit & loss reporting (Business Area by regions or branches)? Do you want to report daily or weekly balances? If yes, then you need Special Ledger.

2.12 Consolidation
Do you require group consolidation across companies? Is consolidation performed in steps? Please describe the consolidation process. Do you require consolidation by Business Area? Yes Yes No

No

2.13 Correspondence
Please list the types of correspondence

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that are currently produced for Accounts Receivable and Accounts Payable (for example, dunning letters, account balance statements, checks, payment advice). Will you need additional types of correspondence to meet your future needs?

3 Frame Chart of Assets

1000 1050 1100 1200 1201 1220 1300 1301 1305 1310 1315 1320 1325 1390 1700 1710 1720 1800 1810 1820

Accounts

Petty cash Cash in Bank Deposits Accounts receivable Accounts receivable clearing Allowance doubtful accounts Raw material inventory Clearing account stock take results Trading goods inventory Packaging material inventory Semi finished goods inventory Finished goods inventory Spare parts inventory Reserve for obsolete inventory Assets Machinery & equipment Furniture & Fixtures Accumulated depreciation Assets Accumulated depreciation machinery & equipment Accumulated depreciation Furniture & fixtures

Liability
2000 2001 2010 2050 2100 2110 2200 2210 2300 2310 2400 2500 Accounts payable AP clearing Clearing supplier discounts (Net method) Goods received invoice received clearing Sales tax accrued Use tax accrued Employee tax withheld FICA Employee tax withheld federal Accrued salary payroll Accrued hourly payroll Accrued sales rebate Freight clearing

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2510 2520 2530

Freight provisions Customs duty clearing Freight other

Capital/Equity
3000 3010 3990 Capital stock Paid in capital Retained earnings

Revenues
4000 4100 4200 4500 4510 4520 Sales revenues domestic Sales revenues export Freight revenues Discounts Price discounts Volume rebate

Cost of Sales
5000 5010 5100 5110 5120 5200 5210 5300 5310 5400 5410 5500 5550 5600 5700 5710 5720 5999 Cost of goods sold finished goods Cost of sales other Materials Consumption raw material Consumption spare parts Consumption packaging material Inventory change finished goods Inventory change other Scrap Sample Gain/Loss inventory transfer Freight inventory transfer Gain/Loss inventory revaluation Gain/Loss inventory other Freight in Purchase discount Purchase price variance Small price difference variance Cost of goods sold miscellaneous

Admin Expenses
6000 6010 6020 6030 6040 6050 6100 7000 7010 7020 Salaries and wages Direct labor Indirect labor Maintenance Labor Purchased labor Outside consultants Freight out Air transportation Rental car (travel) Training seminars

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7030 7040 7050 7060 7070 8499

Office supplies Telephone Insurance vehicle and equipment Depreciation Miscellaneous expense Miscellaneous expense

Other Income and Expenses

9000 Interest Income

4 Cost Center Accounting (CO)

4.1 Organization Structures
List the legally independent organizational units that are to be illustrated in cost accounting. Are allocations within cost accounting required between these units? Is an overall view of all units desired in cost accounting? Will access to cost center reports be regulated through security authorizations? If yes, describe Yes Yes Yes No No No

4.2 Master Data in Cost Accounting

How are the cost accounting objects organized? by Cost Centers by Orders by Projects If other, please describe: Estimate the number of objects that exist for each object type. Indicate whether a manual data transfer is possible or practical.

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When should the transfer of cost accounting data take place? How many cost elements from financial accounting are processed further in cost accounting. Which costing-based elements do you have?

At the change of the fiscal year During the fiscal year

depreciation interest employee benefit cost

Please list all others:

4.3 Actual Postings to Cost Accounting

4.3.1 Billings, Cash Receipts, Posting Documents How will on-periodically occurring costs be treated? direct transfer from financial accounting imputed costs in financial accounting How does reconciliation of imputed costs between financial accounting and cost accounting take place? At which intervals? 4.3.2 Actual Activity Allocation Do you execute direct actual activity allocations between cost centers? This means activity allocations made on the basis of hours or other activity units. 4.3.3 Personnel Costs How do you treat employee benefit costs? direct transfer from financial accounting imputed costs in financial imputed costs in cost accounting Yes No Manually Via an allocation cost center Via a standard order imputed costs in cost accounting

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accounting

How does reconciliation of imputed costs between financial accounting and cost accounting take place? At which intervals? 4.3.4 Capital Costs Is cost accounting depreciation divided into proportional and fixed elements? Is interest calculated on fixed assets? How do you treat non-periodically occurring costs for Capital Costs?

Manually Via an allocation cost center

Via a standard order

Yes Yes direct transfer from financial accounting imputed costs in financial accounting

No No imputed costs in cost accounting

4.3.5 Periodic Tasks in Actual What assessments or distributions do you carry out in actual? Prepare a list of assessments you carry out in cost accounting. Describe the basis for the assessment of the individual costs (such as number of employees, water usage, etc.). Do these assessments occur as conceived in planning?

4.4 Planning in Cost Accounting

4.4.1 Cost Element Planning In what level of detail does your cost element planning take place?

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In which periods does your cost element planning occur? How are revenues planned? Are the cost elements divided into proportional and fixed elements? 4.4.2 Periodic Allocations in Plan Prepare a list of the individual assessments you carry out in cost accounting. Describe the basis for the assessments of the individual costs. Do you execute direct plan activity allocations between cost centers? This means activity allocations made on the basis of hours or other activity units. Do you carry out plan imputed cost in cost accounting? Costs falling outside periods are often rounded off in cost accounting (such as vacation bonus, contributions, etc.). List the cost elements you treat in this manner and whether they occur as conceived in planning. Yes

No

Yes

No

4.5 Reporting
What management reports do you require? Do you have Balance Sheet and Profit Loss reporting on cost centers How do you report on current actual costs? Yes by Cost Centers by Business Areas by Cost elements Do you perform a comparison of the above actual costs to planned costs? Yes No by Product Others - please describe: No

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Which types of profit do you display in cost accounting?

Cost Center Profit Profit Center Profit Cost Object Profit

Operating Profit Other:

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