SAP FI Define Business Area - SAP FICO

What are Business Areas in SAP FICO?

To identify the transactions coming from different lines of business, SAP uses Business Areas.

Example

For instance, a company XYZ which runs multiple businesses has three different domains - manufacturing, marketing, and sales.

The available options are:

  • First is to create different company codes.
  • And the other better option is to create each of these business lines into the business areas.

What are the benefits or Business Area in SAP FICO?

The benefits associated by using Business Areas are:

  • Business areas can be used if other company codes require the same areas.
  • It is easy to configure if a Business Area is used, as just need to attach to the company code and the other details in that business area will get attached automatically.
  • By using Business Areas in controlling, Profit and Loss statement, Balance Sheet, etc. for business areas can be created. Hence it is used for management accounting in a few companies.

Note − Business areas are used more in Controlling as compared to Finance Accounting.

How to create a new Business Area in SAP FI?

Expand Enterprise Structure as mentioned in the previous topic → Definition → Financial Accounting → Define Business Area → Execute → Go to New Entries.

Enterprise Structure

New Entries Business Area

Enter the Business Area code which is of 4 digits and the configuration is saved.

Business Area Code

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