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SAP function modules are sections of ABAP code which can be re-used in any SAP program.
They generally consist of a number of inputs where you can pass values to the function and a number of outputs which return the calculated value or values back to the calling program.
While developing your bespoke SAP applications you can create your own FM's to perform specific functionality you may wish to reuse but there are also thousands which have already been created by SAP. Many of these actually perform very usful functionality such as simple date caltulations, more complex transaction specific functionality as well as report creation using the ALV reporting function modules.
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