How to Define Financial Management (FM) Area in SAP HANA

What is Financial Management (FM) area in SAP

Financial Management Area (FM Area) in SAP S/4Hana is an important organizational unit used in funds management and cash budget management to generate all cash flow statement reports and fund flow statement reports.

Financial Management Area in SAP Hana – Scenarios

1.  The currency FM currency can be different as company code currency
2. You can assign more than one company code to FM area in SAP
3. You cannot change the FM area currency after postings for the FM area have been done in SAP HANA.
4. You can define the financial management area separately for both funds management and cash budget management in SAP.

How to Define Financial Management Area in SAP S/4HANA

You can create a new FM Area in SAP Hana using the following configuration steps

• IMG Menu Path: SPRO {Transaction Code} -> SAP Reference IMG -> Enterprise Structure -> Definition -> Financial Accounting -> Maintain FM Areas
• Transaction code: OF01

Step 1: From SAP Easy Access S/4Hana Access screen, execute transaction code SPRO as shown below image

Step 3: Choose “SAP Reference IMG”

Step 4: From display IMG screen, navigation to IMG menu path and click on IMG activity of “Maintain FM Areas”

Step 5: In next screen, change the view of Financial Management Areas {FM Areas}, it display list of FM area the defined in SAP S/4Hana system. To create new FM areas in S4Hana, click on the new entries option

Step 6: On new entries of FM Area creation S/4Hana screen, enter the following details

• FM Area: Enter 4 characters alphanumeric key that identifies as Financial Management Area in SAP S4Hana system.
• Name of FM Area: Enter the name of the Financial Management Area
• FM Area currency:  Enter the currency of the Financial Management Area

After updating the required FM area, choose the save option to save the details of FM area in SAP S/4Hana system.