What is functional classification in SAP PSM-FM - Funds Management?

SAP Term: functional classification

• Component: PSM-FM

• Component Name: Funds Management

• Description: A numeric code that categorizes a government expenditure according to its government function, for example, safety, science and education, or environmental protection.

Smart SAP Assistant

• Key Concepts: 
  Functional classification is a feature of Funds Management (FM) in SAP that allows users to classify funds according to their purpose. This classification helps to ensure that funds are used for their intended purpose and that the budget is managed effectively. It also helps to provide an overview of the financial situation of an organization. 
  
  How to use it: 
  Functional classification can be used in Funds Management (FM) in SAP by setting up a functional structure for the organization. This structure can be used to classify funds according to their purpose, such as research and development, marketing, or operations. The functional structure can also be used to track the budget and monitor spending. 
  
  Tips & Tricks: 
  When setting up a functional structure for Funds Management (FM) in SAP, it is important to ensure that the structure is comprehensive and easy to understand. It should also be flexible enough to accommodate changes in the organization’s financial situation. 
  
  Related Information: 
  For more information on functional classification in Funds Management (FM) in SAP, please refer to the official SAP documentation. Additionally, there are many online resources available that provide detailed tutorials and best practices for setting up a functional structure in SAP.