SAP TREASURY

MONEY MARKET
Scope
General Settings
• Define and Assign Accounting codes and Valuation areas
• Initialization of Parallel Valuation Areas
• Define and Assign Valuation Classes
• Define Account Determination

Money Market / Foreign Exchange

• Define Product Types
• Define Number range for Transaction Types
• Define Transaction Types
• Assign Product Types to Transaction Types
• Define Flow Types
• Assign Flow Type to Transaction Type
• Define Calculation Procedure for Derived Flows
• Define Derivation Procedures and Rules
• Define Update Types and Assign Usages
• Assign Flow Types to Update Types
• Define Correspondence Activities
• Assign General Valuation Class
 General Valuation Class

A general valuation class must

be assigned to every financial
transaction from which the
special valuation classes of
different valuation areas can
be derived.

In this IMG activity you can

define a general valuation
class depending on the
company code, product type
and transaction type which is
used as a default value when
entering a transaction type.
Define Product Types – Money Market
Define Product Types – Forex
Number Ranges
Define Transaction Types
Create Flow Types
Assignment of Flow Types
Define Derivation Procedure
Define Derivation Procedure
Define Update Types
Define all the update types that are required to manage the
positions in the parallel valuation areas:

You assign all update types to the usage securities account

management which is required for managing positions or for
which specific information may have to be defined for
securities account management.
SAM1104 Final repayment (scheduled)
SAM1105 Annuity
SAM1106 Installment repayment
SAM1900 Nominal adjustment: Increase

Update types are defined in sample Customizing and assigned

to usages as well as specified for different usages. When you
make your Customizing settings you should refer to sample
Customizing.
Assign Update Types to Flow Types
Define Condition Types
Define Condition Type to Transaction Types
Assign the time and amount structure to the various financial
transactions you wish to represent in Treasury management via
condition types. Interest, repayment or commission are
examples of condition types.

Condition types automatically generate flows which are the

basis for further processing in FI and Cash management as well
as for analysis in Market risk management.

To your condition types, you assign

• classification
• condition category and
• flow type.

The classification divides up the condition types according to

business criteria. Via the chosen classification, you restrict the
possible condition categories. Condition categories allow the
system to interpret and process your settings.
 Define
Accounting
Codes
Parallel Accounting in SAP FI
Parallel Accounting
Parallel Accounting: The ‘Parallel Accounting’ in SAP is achieved by storing and posting data in various ‘accounting principal’ in
separate ledgers, with the data for one accounting principle stored in the G/L (leading ledger) as the ‘leading’ valuation view.
Additional ledgers (non-leading ledgers) are used for each of the (parallel) accounting principles.

Advantages:
o No additional G/L account are required
o Each accounting principle is maintained in a separate ledger
o Different fiscal year variant can be used
o Ability to make use of the standard reporting functionality for bringing out financial statements under this customizing step,
the following activities are carried out:
o Define accounting principles: The required accounting principles, as decided by the local and group statutory reporting, are
defined
o Assign ‘ledger groups’ to accounting principles
Ledgers in Parallel Accounting
Leading Ledger: In the leading Ledger all the postings are taken as primarily and default. It is based on
accounting principles that is used for the consolidation of financial statements. Leading Ledger in SAP system is
defined as 0L and company codes are assigned to this ledger by default.

Non Leading Ledger: This Non leading ledgers are used for the purpose of reporting like international Financial
Reporting Standards (IFRS) and taxation. It is Parallel to Leading Ledger and based on the local accounting
principles. You can activate non leading Ledger for individual company code that you plan to use.

Examples:
o The company is located in India and US, where the parent company is located in India.
o In India, Organizations are required to submit final statements for 1st April to 31st March.
o In US, Companies should submit financial statements from 1st January to 31st December.
o The main Financial reporting is done for parent company India is leading ledger and for reporting for US is
Non Leading Ledger.

Leading and Non Leading Ledger enables you to maintain financial accounts for more than one accounting
principle as per company requirements. The parent company from India is required to prepare FS as per India
GAAP and company from US is required to prepare reports as per USGAAP. In some cases transactions may
differ as per accounting standards, so you post transactions in particular ledger instead of both ledgers.
IMG > Financial Accounting (New) > Financial Accounting Global Settings (New) >
Ledgers > Ledger > Define Ledgers for General Ledger Accounting
IMG > Financial Accounting (New) > Financial Accounting Global Settings (New) >
Ledgers > Ledger > Define and Activate Non-Leading Ledgers
Here you make the following settings for the non-leading
ledgers for each company code:

• You activate the non-leading ledgers in the company

code.
• You can define additional currencies beyond that of the
leading ledger. The first currency of a non-leading
ledger is always the currency of the leading ledger (and
hence that of the company code). For the second and
third currencies of a non-leading ledger, you can only
use currency types that you have specified for the
leading ledger.
• You can define a fiscal year variant that differs from
that of the leading ledger. If you do not enter a fiscal
year variant, the fiscal year variant of the company
code is used automatically.
• You can specify a variant of the posting periods.
Document Splitting
In SAP ERP the document splitting is the most powerful tool is widely and most commonly used. With this
function the document splits the line items based on the “Characteristics” we define in system. Often this
function is used to get the financial statements correctly for segment reporting.

Document Splitting – Zero Balancing

As discussed above when system is not able to balance out the transaction entry based on its own it balances out
by “zero balancing” account. System adds the zero balance account at its own to make balance zero for
transaction. We will see the example for this now –
Document Splitting – Zero Balancing
Document Splitting - Configuration
SPRO –> SAP Reference IMG –> Financial Accounting (New) –> General Ledger Accounting (New) –
> Business Transaction –> Document Splitting –> Classify G/L Accounts for Document Splitting

Here in this step GL’s are classified according

to item categories according to business
transaction nature. It is recommended that
instead of assigned item category to each
individual general ledger account try
maintaining the item categories for “Range
of General Ledger Accounts”.
SPRO –> SAP Reference IMG –> Financial Accounting (New) –> General Ledger Accounting (New) –
> Business Transaction –> Document Splitting –> Classify Document Type for Document Splitting

In this step the “Business Transaction”

and “Business Transaction Variant” is
assigned to document types. Now
almost every financial transaction in
considered for document splitting.
SPRO –> SAP Reference IMG –> Financial Accounting (New) –> General Ledger Accounting (New) –
> Business Transaction –> Document Splitting –> Define Zero Balance Clearing Account

In this step we have to define the zero

balance clearing account which will be
used to generate and balance out financial
entry when it is not possible to balance
out at its own, as we have seen this
example earlier.
SPRO –> SAP Reference IMG –> Financial Accounting (New) –> General Ledger Accounting (New) –
> Business Transaction –> Document Splitting –>Define Document Splitting Characteristics for General
Ledger Accounting

This is one of the most important

configurations step in document splitting. In
this step we have to define the splitting
characteristics. Additionally you can define
whether this should be Zero Balance and
Mandatory.
SPRO –> SAP Reference IMG –> Financial Accounting (New) –> General Ledger Accounting (New) –
> Business Transaction –> Document Splitting –>Activate Document Splitting
 Define
Valuation
Areas
 Assign
Accounting
Codes &
Valuation
Areas
Initialize Parallel Valuation Areas
TPM_INITIALIZE

Here is rule for Initialization -:

Initialization posts all the
historical documents from the
operative valuation area in the
parallel valuation area but
condition is all the accounting
customization in treasury should
be completed and Initialization
should be completed before the
first transaction enter into
system.
Internal Deal
Mirroring
Mirroring
 Maintain
Correspondence
 Assign
General
Valuation
Class
 General
Valuation
Class -
Activation
 Activate
Financial
Object
Integration
 Activate
Integrated
Limit Check
 Exclude
Product
Types for
Postings
Define Cash
Management
Number
Ranges
Maintain
Structure

Only Required to be maintained for GL Bank Accounts when you add a new entity.
Caution: Grouping should be carefully done so Cash pools and Non cash pools are grouped
correctly. Otherwise will impact Daily Liquidity!!
Maintain Traders Access
Transaction Code TBT1 – for New Co code Trader Access