What is 'nature of business' in SAP FI - Financial Accounting?

nature of business - Overview

• Component: FI

• Component Name: Financial Accounting

• Description: It indicates the main objective of the business between companies or between companies and customers.

nature of business - Details

• 
  Key Concepts: 
  Nature of business is a term used in SAP Financial Accounting (FI) to describe the type of business an organization is engaged in. It is used to classify the company’s financial transactions and to determine which accounting rules should be applied. The nature of business is also used to determine which reports should be generated and which taxes should be paid. 
  
  How to use it: 
  In SAP FI, the nature of business is set up in the company code configuration. This setting can be changed at any time, but it is important to ensure that all transactions are correctly classified according to the new nature of business. Once the nature of business has been set up, it will be used to determine which accounting rules should be applied and which reports should be generated. 
  
  Tips & Tricks: 
  It is important to ensure that the nature of business is set up correctly in SAP FI, as this will affect how transactions are classified and reported. It is also important to keep this setting up-to-date, as changes in the company’s operations may require a change in the nature of business. 
  
  Related Information: 
  The nature of business setting in SAP FI can be found in the company code configuration. For more information on setting up and managing the nature of business, please refer to the SAP