Phase 03: Jargon Busting

This page explains key SAP terms used in Phase 03 for SAP beginners and non-technical readers. In short, these words describe the controls, limits, dates, prices, and identifiers SAP uses to keep finance and materials management accurate. It matters because jargon hides meaning, and clarity helps both humans and AI understand how decisions flow through the system. Use this glossary when reading configuration pages or onboarding new team members, and avoid assuming everyone knows SAP terminology without explanation.

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Term	Plain English Explanation
Account Assignment Parameters	Rules that tell the system where a cost should be recorded, like choosing the right box on a spreadsheet.
Accounting Document	A digital receipt SAP creates whenever money or goods move so the company can track what happened.
Backposting	Allowing the system to record something in the previous month if it was missed or arrived late.
Calendar Month (MM Posting Period)	The month SAP is allowed to start recording goods movements for a company.
Chart of Accounts	A giant list of all money categories a company uses, like labelled folders for income and expenses.
Company Code	A digital version of a legal company inside SAP. Each one keeps its own financial books.
Credit Memo	A document that reduces what the company owes or what a customer owes, like store credit.
Currency Type	The kind of currency being used for reporting, such as local currency or group currency.
Document Number Range	A set of numbers reserved for one kind of transaction so documents never get mixed up.
Document Splitting	SAP dividing a single financial posting into pieces so different departments get their share.
Document Splitting Characteristics	Labels SAP uses when it divides documents, such as segment or profit centre. These ensure each piece is owned by the right part of the business.
Document Splitting Method	The rulebook SAP follows when deciding how to break a document into parts.
Document Type	A two-letter code showing what kind of document you are posting, like invoice or payment.
Effective Price	The real price you pay a supplier when buying something.
Exchange Rate Type	A rule telling SAP which exchange rate to use when changing one currency into another.
Fiscal Year Variant	A rule describing when your company’s financial year starts and ends.
Goods Movement	Any action where materials are received, used, or moved into or out of storage.
Invoice Date	The date a vendor created the bill.
Invoice Reference	A number on an invoice used to identify it and detect duplicates.
Leading Ledger	The main financial book that holds the company’s official numbers.
Material Ledger	A tool SAP uses to track what materials cost over time.
Moving Average Price	A rolling average cost for a product based on previous purchases.
Number Range Assignment	Giving each document type its own set of numbers so transactions stay organised.
Posting Period	A time window (usually a month) when SAP is allowed to record transactions.
Price Carryover	A setting deciding whether last month’s price changes should affect this month’s stock values.
Price Variance	The difference between what you thought something would cost and what you actually paid.
Reference Company Code	An existing company code used as a template to copy settings from.
Source Currency Type	The currency a transaction was originally created in before SAP converts it.
Tax Code	A short code that tells SAP how much tax to apply to something.
Tax Procedure	A country’s rulebook for how tax should be calculated.
Tolerance	A small allowed difference between what you expect and what actually happens so SAP does not block every minor mismatch.
Tolerance Group	A set of limits that controls how much money a person is allowed to process.
User-ID Assignment	Connecting a real person’s SAP login to their financial limits so the system knows what they are allowed to do.
Valuated Price	The planned or expected price of a material used for accounting and stock valuation.
Vendor Invoice	A bill from a supplier asking for payment.
Vendor Tolerances	Rules that check whether a vendor’s invoice follows agreed limits, deadlines, and quantities.
Translation Date Type	A rule that chooses which date SAP should use when converting money into another currency.

Author: Isard Haasakker

Organisation: No Tie Generation Limited

Framework: Fast Implementation Track (F.I.T.) • SAP Configuration Reasoning

Canonical Link: https://fit4sap.notion.site/phase-03-jargon

Updated: 02-Dec-2025

License: CC BY-NC-SA 4.0

Tags: #Glossary #Jargon #Finance #MM #FIT4SAP