SAP Basics interview questions

SAP stands for Systems, Applications and Products in Data Processing. It is a German multinational software company founded in 1972, and its flagship product is the world's most widely used ERP (Enterprise Resource Planning) system. ERP stands for Enterprise Resource Planning — software that integrates all core business processes into a single unified system: - Finance and Accounting (FI/CO) - Sales and Distribution (SD) - Materials Management (MM) - Human Resources (HR/HCM) - Production Planning (PP) - Plant Maintenance (PM) - Quality Management (QM) Why ERP matters: Before ERP, each department ran its own isolated system — sales used one software, finance used another, warehouse used a third. Data didn't flow between them, leading to duplication, errors, and delays. SAP ERP integrates all departments into one system where a sales order in SD automatically triggers inventory updates in MM, generates a delivery in WM, creates a billing document in SD, and posts an accounting entry in FI — all in real time. SAP versions: - SAP R/3: Classic client-server architecture (still widely used) - SAP ECC (ERP Central Component): Current on-premise version - SAP S/4HANA: Next-generation in-memory ERP (cloud and on-premise) - SAP HANA: The in-memory database platform underlying S/4HANA Market position: SAP is used by 92% of the Forbes Global 2000 companies. In India, TCS, Infosys, Wipro, HCL, and Accenture employ hundreds of thousands of SAP consultants.

SAP is organized into functional modules, each covering a specific business area. They are deeply integrated — a transaction in one module triggers automatic postings in others. Finance and Controlling: - FI (Financial Accounting): General ledger, accounts payable, accounts receivable, asset accounting, bank accounting. Produces statutory financial statements (P&L, Balance Sheet). - CO (Controlling): Internal cost management — cost centers, profit centers, internal orders, product costing, profitability analysis (CO-PA). Used for management reporting. - FICO is the most common combined specialization. Logistics: - SD (Sales and Distribution): Order-to-cash process — sales orders, pricing, delivery, billing, credit management, customer master. - MM (Materials Management): Procure-to-pay process — purchase orders, goods receipt, invoice verification, inventory management, vendor master, material master. - PP (Production Planning): Manufacturing — Bill of Materials (BOM), routings, production orders, capacity planning, MRP (Material Requirements Planning). - WM/EWM (Warehouse Management / Extended Warehouse Management): Physical warehouse operations — storage locations, transfer orders, goods movements. - QM (Quality Management): Inspection lots, quality notifications, certificates of analysis. - PM (Plant Maintenance): Equipment maintenance, work orders, preventive maintenance. Human Resources: - HCM (Human Capital Management) / HR: Personnel administration, payroll, time management, organizational management, training and development. - SAP SuccessFactors: Cloud HCM suite (recruiting, learning, performance, workforce analytics). Other key modules: - PS (Project System): Project planning, WBS, project budgeting. - SRM (Supplier Relationship Management): Strategic procurement. - CRM (Customer Relationship Management): Sales force automation (largely replaced by SAP C/4HANA).

SAP's organizational structure is hierarchical. Every transaction is posted at a specific organizational level, and these levels control how data flows across the system. Client (Highest Level): - Represents the entire SAP system/enterprise group - All data (master data, transactional data) is client-specific - Clients are typically: 000 (system client), 001 (template), and a custom production client (e.g., 100, 200) - In a multi-national group, the entire group operates under one client Company Code: - The smallest legal entity for which a complete set of accounts can be drawn up - Represents a legal entity (company) for statutory reporting purposes - Each company code has its own chart of accounts, fiscal year variant, and currency - Example: Tata Motors Ltd (Company Code 1000), Jaguar Land Rover Ltd (Company Code 2000) — both under the Tata Group client Plant: - A production facility, branch, or location within a company code - Linked to one company code; a company code can have multiple plants - Central for materials management and production planning - Example: Tata Motors Pune Plant (Plant 1001), Tata Motors Jamshedpur Plant (Plant 1002) Storage Location: - A physical area within a plant where inventory is stored - Used for inventory management — where exactly is the material? - Example: Raw Material Store (SL01), Finished Goods Store (SL02), Defect Goods Store (SL03) Purchasing Organization / Purchasing Group (MM-specific): - Purchasing Org: Legal entity responsible for procurement negotiations - Purchasing Group: Buyer or group of buyers within the purchasing org Sales Organization / Distribution Channel / Division (SD-specific): - Sales Org: Responsible for distributing goods/services - Distribution Channel: How goods reach customers (wholesale, retail, direct) - Division: Product line grouping

The Order-to-Cash (O2C) process covers everything from when a customer places an order to when payment is received and posted in accounting. O2C steps in SAP SD: 1. Pre-Sales Activities (Optional) - Inquiry (transaction VA11): Customer asks about product/price availability - Quotation (VA21): Company sends a formal price quote - These are reference documents for the sales order 2. Sales Order (VA01 / VA02 / VA03) - Core document of the SD module - Contains: customer, items, quantities, pricing, delivery date, shipping info - Triggers: availability check (checks MM stock), credit check (checks FI credit limit) 3. Delivery (VL01N / VL02N) - Outbound delivery document created from the sales order - Picking: warehouse picks the goods (reduces unrestricted stock to "stock in transfer") - Packing: goods are packed (optional) - Goods Issue (PGI): Physical transfer of goods; stock is reduced; accounting entry posted: - Dr. Cost of Goods Sold (COGS) account - Cr. Inventory account 4. Billing / Invoice (VF01 / VF04) - Billing document created based on the delivery - Triggers automatic accounting entry in FI: - Dr. Customer (AR) account - Cr. Revenue account - Invoice sent to customer 5. Payment (F-28 / F-32) - Customer pays the invoice - Payment posted in FI: - Dr. Bank account - Cr. Customer (AR) account - Cleared against open invoice Key integration points: - SD ↔ MM: Delivery reduces inventory - SD ↔ FI: PGI and billing generate automatic FI postings - SD ↔ CO: Revenue flows to CO-PA for profitability analysis

The Procure-to-Pay (P2P) process covers everything from identifying a need to buy something through to paying the vendor. P2P steps in SAP MM: 1. Purchase Requisition (ME51N / ME52N / ME53N) - Internal document requesting that a purchase be made - Created by: end users, MRP run (automatic), production planning - Not sent to vendor — purely internal 2. Request for Quotation / RFQ (ME41) - Optional: send RFQ to multiple vendors to get competitive quotes - Vendor responses recorded as Quotations (ME47) - Price comparison (ME49) to select best vendor 3. Purchase Order (ME21N / ME22N / ME23N) - Legal contract between company and vendor - Contains: vendor, material, quantity, price, delivery date, terms - Can be created from PR (reference) or independently - Types: Standard PO, Scheduling Agreement, Contract, Framework Order 4. Goods Receipt (MIGO - GR) - Physical receipt of goods from the vendor - Updates inventory: stock increases - Posts accounting entry: - Dr. Inventory / GR/IR (Goods Receipt / Invoice Receipt) account - Cr. GR/IR clearing account (liability pending invoice) - Creates a material document and an accounting document 5. Invoice Verification (MIRO) - Vendor sends invoice; accounts payable team enters in SAP - Three-way match: PO quantity/price = GR quantity = Invoice quantity/price - If matched → posts: - Dr. GR/IR clearing account - Cr. Vendor (AP) account 6. Payment (F110 - Automatic Payment Program) - Vendor payment processed per payment terms - Dr. Vendor (AP) account - Cr. Bank account Three-way match: PO ↔ GR ↔ Invoice — the cornerstone of MM/FI compliance

The Material Master is the central repository for all information about a material (product, raw material, semi-finished good, service) in SAP. Every material that a company buys, sells, stores, or produces has a material master record. Key characteristics: - One material master per material number across the entire client - Data is organized into views, each maintained at different organizational levels - Multiple departments maintain their relevant views — MM team maintains purchasing views, SD team maintains sales views, FI team maintains accounting views Key Material Master views: Basic Data (General): - Material description, base unit of measure, material group, division, weight/volume - Language-dependent description - Maintained at: Client level (visible to all) Purchasing: - Purchasing group, purchasing value key, over/under delivery tolerances, GR processing time - Maintained at: Purchasing Organization level MRP (Material Requirements Planning): - MRP type (MRP, consumption-based), lot size, safety stock, reorder point, planned delivery time - Maintained at: Plant level - Drives automatic procurement proposals Storage: - Storage conditions, unit of issue, warehouse management data - Maintained at: Plant / Storage Location level Sales (Sales: General/Plant): - Delivering plant, loading group, availability check rule - Maintained at: Sales Organization / Distribution Channel level Accounting: - Valuation class (links to G/L accounts), price control (Standard Price "S" vs Moving Average "V"), standard price / moving average price - Maintained at: Plant level - Critical for FI integration — wrong valuation class → wrong G/L account Classification: - Class and characteristic assignments for variant configuration Material Types: Raw Material (ROH), Semi-Finished (HALB), Finished Good (FERT), Trading Good (HAWA), Non-Valuated (NLAG), Service (DIEN)

SAP FICO combines two closely related modules — Financial Accounting (FI) and Controlling (CO) — into the most widely implemented SAP specialization. SAP FI (Financial Accounting): - Purpose: External financial reporting — statutory accounts for tax authorities, regulators, investors, and banks - Produces: Balance Sheet, Profit & Loss (Income Statement), Cash Flow Statement - Legal requirement: Every company is legally required to maintain these accounts - Key objects: G/L accounts, customer accounts (AR), vendor accounts (AP), asset master, bank accounts - Postings: Real postings that affect the legal books - Key sub-modules: - FI-GL: General Ledger (central) - FI-AR: Accounts Receivable (customer invoices, payments) - FI-AP: Accounts Payable (vendor invoices, payments) - FI-AA: Asset Accounting (depreciation, asset acquisition/disposal) - FI-BL: Bank Ledger (bank reconciliation) SAP CO (Controlling): - Purpose: Internal cost management — information for management to make business decisions - Produces: Cost center reports, profit center reports, product cost analysis, profitability reports - Not a legal requirement — designed for management insight - Key objects: Cost centers, profit centers, internal orders, WBS elements, cost elements - Postings: Can be real (some CO postings) or statistical (planning, assessments, distributions) - Key sub-modules: - CO-CCA: Cost Center Accounting (where costs are incurred) - CO-PC: Product Costing (cost of manufacturing a product) - CO-PA: Profitability Analysis (margin by customer/product/region) - CO-IO: Internal Orders (temporary cost collectors) - CO-PCA: Profit Center Accounting The relationship: - FI and CO share the same document — when an FI posting occurs (e.g., salary payment), it automatically generates a CO posting (assigned to a cost center) - New G/L in SAP ECC and Universal Journal in S/4HANA merge FI and CO into a single ledger

A transaction code (T-code) is a 4-6 character shortcut that opens a specific SAP screen or function directly, without navigating through menus. How to use: Type the T-code in the command field (top-left of the SAP screen) and press Enter. Naming conventions: - Create: usually ends or starts with a number "1" or has "N" suffix (VA01, ME21N) - Change: usually "2" (VA02, ME22N) - Display: usually "3" (VA03, ME23N) Essential T-codes by module: SD (Sales & Distribution): - VA01/VA02/VA03: Create/Change/Display Sales Order - VL01N: Create Outbound Delivery - VF01: Create Billing Document - VA11: Create Inquiry; VA21: Create Quotation - VD01/XD01: Create Customer (sales area / full) MM (Materials Management): - ME21N/ME22N/ME23N: Create/Change/Display Purchase Order - ME51N: Create Purchase Requisition - MIGO: Goods Movements (GR, GI, transfers) - MIRO: Invoice Verification - MM01: Create Material Master - MK01/XK01: Create Vendor (purchasing / full) FI (Financial Accounting): - FB01: Post Document - F-28: Post Incoming Payments (AR) - F-53: Post Outgoing Payments (AP) - F110: Automatic Payment Run - FS00: G/L Account Master - FB60: Enter Vendor Invoice CO (Controlling): - KS01: Create Cost Center - KA01: Create Cost Element - KE51: Create Profit Center Basis / Technical: - SE11: ABAP Data Dictionary (tables, structures) - SE38: ABAP Editor (write/edit programs) - SM30: Table Maintenance - ST05: SQL Trace (performance analysis) - SU01: User Administration

SAP projects involve two primary types of consultants who work closely together. SAP Functional Consultant: - Focuses on: Business processes and SAP configuration - Background: Business/commerce/engineering + SAP module expertise - Works with: Business users (SMEs) to understand requirements; translates them into SAP configuration - Key activities: - Business process workshops and blueprint documentation - SAP configuration (IMG / SPRO settings — no coding) - Writing functional specifications for ABAP developers - User acceptance testing (UAT) - User training and documentation - Post-go-live support - Tools: SAP GUI, IMG (Implementation Guide), business process documents - Specializes in one or two modules: SD, MM, FICO, PP, HR, etc. SAP Technical Consultant (ABAP Developer): - Focuses on: Custom development and technical solutions - Background: Computer science / programming + ABAP language - Works with: Functional consultants to build custom programs that standard SAP cannot handle - Key activities: - Writing ABAP programs (reports, data conversions, interfaces) - Creating enhancements (BADIs, User Exits, enhancement spots) - Building interfaces (IDocs, RFCs, APIs, BAPIs) - Developing custom forms (SAP Script, SmartForms, Adobe Forms) - Performance tuning and debugging - Tools: SE38 (ABAP Editor), SE11 (Data Dictionary), ST05 (SQL Trace), Eclipse (ABAP Development Tools) SAP Basis Consultant: - Manages the SAP landscape: installation, configuration, performance, security, transport management, upgrades - The "system admin" of SAP Career path: - Most SAP professionals start as functional consultants in one module - Senior functional consultants may learn light technical skills (reading ABAP, writing functional specs) - The combination of functional + technical knowledge (especially FICO + ABAP) commands the highest salaries

ABAP (Advanced Business Application Programming) is SAP's proprietary programming language used to develop custom programs within the SAP environment. Key characteristics: - Interpreted/compiled on the SAP application server (not the client) - Strongly typed with both procedural and object-oriented (ABAP Objects) paradigms - Deep integration with SAP database tables and business logic Core ABAP concepts: Data types: - Elementary: C (character), N (numeric text), I (integer), P (packed decimal), D (date), T (time), F (float), X (hexadecimal) - Complex: Structures (like a record), Internal Tables (like an in-memory table) Internal Tables: - The most important ABAP data structure — an in-memory table for processing data - Types: Standard table (allows duplicates), Sorted table (auto-sorted), Hashed table (hash key access) - Common operations: APPEND, READ, LOOP AT, SORT, DELETE SELECT statement (reading from database): SELECT matnr maktx FROM makt INTO TABLE lt_makt WHERE spras = 'EN'. LOOP AT (processing internal table): LOOP AT lt_makt INTO ls_makt. WRITE: / ls_makt-matnr, ls_makt-maktx. ENDLOOP. Key ABAP program types: - Reports (Type 1): Standalone programs with output (SE38) - Function Modules: Reusable subroutines callable from any program (SE37) - Classes / Methods: Object-oriented programming (SE24) - BADIs / User Exits: Standard SAP enhancement points where custom code plugs in - BAPIs: Business APIs — standard SAP function modules for external calls - IDocs: Intermediate Documents for electronic data interchange (EDI) Important SAP tables every ABAP developer knows: - MARA: Material master (general) - VBAK/VBAP: Sales order header/items - EKKO/EKPO: Purchase order header/items - BKPF/BSEG: Accounting document header/items

SAP S/4HANA is SAP's next-generation ERP suite, built on the SAP HANA in-memory database platform. It is SAP's strategic product — SAP has announced mainstream maintenance for ECC ends in 2027 (extended to 2030+ for some customers), making S/4HANA migration the biggest SAP project wave globally. Key differences from SAP ECC: 1. In-memory Database (HANA): - ECC: runs on third-party databases (Oracle, SQL Server, DB2, MaxDB) - S/4HANA: runs exclusively on SAP HANA (columnar, in-memory) - Result: analytics that took hours in ECC run in seconds in S/4HANA 2. Simplified Data Model: - ECC: Many redundant aggregation tables (BSIS, BSAS, BSID, BSAD, FAGLFLEXT, COSS, COSP...) - S/4HANA: Universal Journal (table ACDOCA) — single source of truth combining FI and CO - All financial postings go to one table; old aggregate tables are replaced by virtual views 3. Universal Journal (ACDOCA): - Single line-item table for all accounting — FI, CO, Asset Accounting, ML (Material Ledger), Profit Center - Eliminates reconciliation between FI and CO - Real-time reporting from line items — no need for batch aggregation jobs 4. Fiori User Interface: - ECC: SAP GUI (transaction-based, Windows desktop client) - S/4HANA: SAP Fiori (browser-based, mobile-friendly, role-based apps) - Fiori Apps replace T-codes with intuitive web applications 5. Embedded Analytics: - S/4HANA: Real-time operational reporting within the ERP without a separate BW/BI system - CDS Views (Core Data Services) replace custom reports 6. Simplifications: - MRP (Material Requirements Planning) runs on HANA in seconds - Business Partner replaces separate Customer/Vendor masters - Document splitting available without additional configuration Deployment options: - S/4HANA Cloud (public): SAP-managed, faster innovation, lower IT overhead - S/4HANA Cloud (private): Customer-managed cloud on Azure/AWS/GCP - S/4HANA On-Premise: Customer-managed in their own data center

SAP Fiori is SAP's modern user experience (UX) design system and application portfolio — replacing the traditional SAP GUI with browser-based, mobile-friendly applications. Background: SAP GUI (the classic green-screen interface) was powerful but notoriously complex and unintuitive. SAP Fiori, launched in 2013, was designed to provide a consumer-grade experience. Fiori Design Principles: 1. Role-based: Shows only what's relevant to the user's job role (a warehouse worker sees receiving apps; an AP clerk sees invoice apps) 2. Responsive: Works on desktop, tablet, and mobile browsers 3. Simple: Each app focuses on one task — no cluttered screens with 100 fields 4. Coherent: Consistent look and feel across all SAP applications 5. Delightful: Clean, modern UI with meaningful visual indicators Types of Fiori Apps: - Transactional apps: Create, change, display business documents (sales orders, POs, invoices) - Analytical apps: Real-time reports and KPI tiles (live dashboards) - Fact sheets: Contextual information cards about business objects (customer, material, vendor) Fiori Launchpad: - The browser-based home screen for SAP Fiori - Displays tiles (shortcuts) organized by role - Users click tiles instead of typing T-codes - Personalization: users can add/remove tiles and arrange their launchpad Fiori App Library: - SAP publishes 10,000+ standard Fiori apps for S/4HANA - Each app has a unique App ID - Example: F0842 "My Inbox" (workflow approvals), F1243 "Manage Sales Orders", F0971 "Approve Purchase Orders" Technology stack: - SAPUI5: SAP's JavaScript UI framework based on OpenUI5 (open source) - OData Services: RESTful APIs that Fiori apps call to fetch/post data - SAP BTP (Business Technology Platform): Where custom Fiori apps are deployed