JUL-SEP 2007 Vol 3 Issue14

Technova                                                 

 

SAP ERP- Financial

by Abhyan Arora
IIIT Gwalior
e-mail-abhay_2183@yahoo.co.in

Finance is the vital part of any organization despite it is a profit or non-profit organization. A good control on finance any organizations secure its existence in the competitive business world. Time changed but the importance of finance remains same. Revolution of IT added new feature in this which enhanced its capability & reliability, security threat are also there but when it is a matter of Finance there will always a threat in some or another form.ERP software proven to be a valuable business tool which increased the efficiency & integrity between different component of an organization such as marketing, finance, operation etc. But here we will talk about the functional part of it in finance domain not about the technical part.

     Implementation with SAP Financial Accounting (FI) and SAP Controlling (CO) module, the fundamental bookkeeping modules. SAP financial modules provide whole of accounting functionality with extensive reporting support system, the controlling module have functionality for the controlling purposes. An important aspect of the financial accounting system is the real-time generation of the current balance.SAP is a globalized solution for the industry but it provides the functionality according to various countries taxation rules and regulations the CIN which is known as country India versions define the rules and regulations  in Indian context. The related modules are SAP Enterprise Controlling (EC) providing an executive management system (EIS), as well as financial consolidation for subsidiaries in countries with different legal regulations, and the SAP Treasury (TR) module. Documents generated by the financial modules have a relatively low performance impact on the SAP system.

      The primary SAP R/3 application module that support financial activities are:

 
  • Financial Accounting
  • Controlling

            Financial Accounting is broken down into the following sub modules:

  • General Ledger accounting - The general serves as a complete record of company’s business transaction show company’s accounts is being managed.
  • Accounts Receivable - This component manage the most integral part of the organization administrative data of customer is being maintained
  • Accounts Payable – This application module keep records and administrative data of vendors
  • Legal Consolidations
  • Special Purpose ledger
  • Asset Accounting- This component manages companies fixed asset. Asset accounting

            Controlling is broken down into the following sub modules:

  • Overhead Cost Controlling
  • Product Cost Controlling
  • Sales and Profitability Analysis
  • Activity Based Costing

SAP ERP provides powerful analytic software that enables powerful financial analysis to help to the analyze business financial transaction. It helps to develop the plan controlling techniques for the betterment of business. It helps to make a common platform which help for creating the business thoughts in an efficient manner. This helps to business for better performance.

SAP ERP supports financial analysis and reporting for a wide range of users -- from C-level executives to line-of-business managers.

SAP ERP includes features and functions that support the following business activities:

  • Financial and management reporting.
  • Planning, budgeting, and forecasting
  • Strategy management and scorecards
  • Cost and profitability management
  • Working capital and cash flow management
  • Payment behavior analysis

Disclaimer : The views expressed in the articles are author’s own views B’Cognizance or IIITA is not liable for any objections arising out of the same. The matter here is solely for academic use only.
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