The company and master data in SAP Business One

After the environment decision at the previous station, this is the first station where you build something. It is also the most dangerous on the path, because some of its decisions are taken once, when the company database is created, and are not repaired later by configuration.

The decisions taken once

The general rule governing this station: what is decided when the company is created is repaired later with a new database, not with a settings screen.

Four of them are worth writing down.

1. The country localisation. It sets the tax model and the local report formats. Choosing the wrong localisation is not an error in a field; it is a company rebuilt from scratch.

2. The local currency and the system currency. Because everything after them is translated into them.

3. The inventory method. Is the stock account in the general ledger updated with every movement, or is cost recorded periodically? That decision shapes your income statement, and its full effect is set out at station six.

4. The chart of accounts. Built from the localisation template, and amended afterwards with a difficulty that rises with every movement posted against it.

The practical advice: create a training database, break it deliberately, then create another. That is the real value of a training environment with nothing to lose in it — making your mistakes there before you make them at a client.

Account determination — half the understanding in one concept

This is the concept that separates somebody who “knows the screens” from somebody who “understands the product”.

The question asked on every project: why did this entry go to this account?

The answer is that the product does not ask the user for an account on every document. It infers it from rules configured in advance, and those rules have levels, with the more specific beating the more general:

Level	What it covers	When to use it
Company	The default rule for everything	Always start here
Warehouse	Movements at one specific warehouse	A warehouse with different accounting treatment
Item group	Every item in the group	The most used level on a sound project
Item	One specific item	A justified exception, not a rule

Read the last two rows together, because between them lies the difference between a project that is maintained and one that is abandoned.

Setting accounts at item group level configures dozens of items with one decision, and changes them with one decision. Setting them at item level saves a minute today and costs a week a year from now, the day somebody asks for the account to change on five hundred items.

The rule: configure at the highest level that suffices, and descend one level only when there is a written reason.

The business partner — one record with roles

A partner in this product is not a customer and is not a vendor; it is a partner with a type: customer, vendor, or lead. Its identity — name, address, tax registration number — is written once.

Three fields on it are filled now and thanked for later:

• The tax registration number, which is asked for literally at station eight.
• The address in separate components rather than one block of text — for the same reason.
• Payment terms and the credit limit, because a sale that is never collected is not a sale.

The rule governing partner data: clean before you migrate, never after. Cleaning data on a live system costs twice as much and happens under operational pressure.

The item master — three questions before any field

The item record is long, and it collapses into three questions answered first:

1. Is it an inventory item? Is it held and valued — or is it a service that is sold and never stored?
2. Is it purchased, sold, or both? That decides which documents it appears in.
3. How is it valued? That is the whole of station six, and it is decided here rather than there.

Everything beyond those three is filled when needed. A field filled because the screen displays it is a field maintained for ever at no return — and most master-data projects bloat from here rather than from the number of items.

Units of measure — the silent error

Buying by the carton, selling by the piece and storing by the box is entirely normal, and setting the conversion factors between them is what prevents differences that look like price errors and are arithmetic errors.

Set them now, because discovering them after go-live means reviewing every movement posted in between.

What you actually do at this station

• Create a complete company database with your country’s localisation, then write why you chose each of the four decisions.
• Build three item groups and set account determination on them rather than on the items.
• Create five items by answering the three questions only, and leave the rest.
• Create three partners — a corporate customer with a tax number, an individual customer without one, and a vendor — with credit limits and payment terms.
• Create two warehouses and write why two rather than one.

Then do what a real consultant does: document all of it on one sheet explaining the structure and the reason for every decision. That sheet is a portfolio piece, and it is the first thing a partner asks a new trainee for.

The three commonest errors

One: building a chart of accounts by copying another company’s. The chart is a reflection of what you want to read in your reports, and copying it imports decisions that were never taken. A bloated chart does not produce detail; it produces empty accounts that confuse the reader.

Two: setting accounts at item level from the start. It works in the demonstration and collapses at the first bulk change.

Three: deferring tax numbers and credit limits on the grounds that they will “be filled in later”. They are never filled in later — they are filled under pressure, at random, on the day a report is asked for.

What master-data quality does to project cost and implementation days is set out in the SAP Business One guide.

The acceptance test for this station

1. Write the four decisions taken at creation, and what happens if you get each one wrong.
2. Explain the levels of account determination from memory, and which one wins.
3. Create a complete company database and document it on one justified sheet.
4. Design five items by answering the three questions only.
5. Set a purchase unit different from the sales unit on one item, and calculate the conversion by hand to verify it.

What comes next

The structure is ready. The next station moves the first money: the purchase cycle — from requisition to paying the vendor — containing the intermediate account between receipt and invoice, which is the clearest place in the product to understand how it thinks about money.