1. What is the R2R process in SAP FICO? Answer:R2R (Record to Report) is the financial process of collecting, processing, and delivering accurate financial data for reporting. In SAP FICO, R2R includes: Data recording (GL, AP, AR, Asset Accounting, Bank Accounting) Period-end closing (Accruals, Provisions, FX Revaluations) Consolidation (Group reporting, Intercompany reconciliations) Reporting (Balance Sheet, P&L, Cash Flow, Management Reports). 2. How does R2R differ in SAP S/4HANA compared to ECC? Answer: Universal Journal (ACDOCA): Combines FI, CO, AA, ML, COPA tables → one single line item table. Real-time integration: No need for reconciliation between FI & CO. Faster closing: Accelerated processes with SAP Fiori apps and automation. Embedded analytics: Real-time reporting with CDS views. Elimination of redundant tables: BSEG, COEP, MLIT, etc. partially replaced by ACDOCA. 3. What are the key R2R sub-processes in SAP FICO?Answer: Journal Entry processing (manual & automated) Intercompany Accounting Accruals & Provisions Fixed Asset Accounting & Depreciation Run Foreign Currency Valuation & Translation Period-End Closing & Financial Statements Consolidation & Reporting 4. Explain Universal Journal and its role in R2R. Answer:The Universal Journal (table ACDOCA) stores all financial and controlling data in a single line item table. Eliminates reconciliation between FI & CO. Allows multi-dimensional reporting (profit center, segment, customer, product, etc.). Simplifies R2R cycle with real-time postings and analytics. 5. What is the importance of period-end closing in R2R? Answer: Ensures all revenues & expenses are recognized in the correct accounting period. Activities include: Accruals, Provisions, Depreciation, Asset Closing, GR/IR Clearing, FX Valuation. In S/4HANA, Closing Cockpit (Fiori apps) streamlines and automates period-end tasks. 6. How are Accruals handled in SAP FICO? Answer: Manual accruals (FB50, FBS1). Automatic accruals using Accrual Engine or Recurring Entries (FBD1). In S/4HANA, Accrual Engine is integrated with Universal Journal → better transparency and audit trail. 7. What is GR/IR clearing in R2R? Answer: Temporary account for goods receipt vs invoice receipt mismatch. Ensures expenses/liabilities are booked correctly before invoice arrives. At period-end, run GR/IR clearing program (F.19) to adjust open items. 8. How is Foreign Currency Valuation done in R2R? Answer: At period-end, foreign currency balances must be revalued. Transaction: FAGL_FCV (New) in S/4HANA. Adjustments posted to Unrealized Gain/Loss accounts. Runs based on valuation area, currency type, valuation methods. 9. What are key reporting tools in R2R under SAP HANA? Answer: SAP Fiori apps (Trial Balance, P&L, Balance Sheet). Embedded Analytics (CDS views + KPIs). SAP Analytics Cloud (SAC) integration for visualization. Group Reporting (S/4HANA Finance) for consolidation. 10. What is Intercompany Reconciliation in R2R? Answer: Ensures balances between group entities match before consolidation. Tools: Intercompany Reconciliation (ICR) process in SAP → Process 001: Document-to-Document Reconciliation Process 002: Account Reconciliation Process 003: Transaction Matching 11. What are Closing Cockpit & Financial Closing Cockpit? Answer: Closing Cockpit (transaction CLOCO): Automates closing activities (schedules, dependencies, status tracking). Financial Closing Cockpit (FCC): Advanced tool in SAP S/4HANA with Fiori integration for multi-entity closings. 12. How is Asset Accounting integrated in R2R? Answer: Depreciation Run (AFAB / FAA_DEPRECIATION_POST). Asset acquisition, retirement, transfer directly update GL in Universal Journal. No separate reconciliation needed. 13. What challenges in R2R does SAP S/4HANA solve? Answer: Manual reconciliations → eliminated via Universal Journal. Delayed reporting → replaced by real-time analytics. Multiple ledgers & currencies → supported natively in ACDOCA. Complex closings → streamlined with Closing Cockpit & Fiori apps. 14. Difference between Leading Ledger and Non-Leading Ledger in R2R? Answer: Leading Ledger (0L): Used for Group/Corporate reporting under IFRS/GAAP. Non-Leading Ledger: Used for local statutory reporting (e.g., India Accounting Standards). Both updated in Universal Journal in parallel accounting. 15. Can you explain R2R KPIs tracked in SAP? Answer: Days to close books Accuracy of financial reporting % of automated journal entries Intercompany reconciliation time On-time statutory compliance
