With the Board, we have been working on SAP's strategy and actually produced a fairly detailed document that will be made available to all of you shortly. If I were to summarize this document, this is how I would do it. As Marty just told, being a great company is when there's a match between clients' expectations and your reality. If we want to be a great C°, we have to deliver on expectations . I am sure there's a word we all cherish in this summary it is independence. But independence has a price, it is financial performance that drives market cap. A company's value depends on: Earnings: increase profitability (25 %, benchm. Oracle) grow SW-licence faster (1,5 times) Strategy: &quot;one voice&quot; - doc. on strategy Reputation: keep building the SAP brand with pride Independence is also about running faster than the others (c.f. the bill GATES anecdote). Being a fast follower isn't sufficient anymore. The market expects SAP to lead the way in turning the promise of new technologies into results bearing business reality. We want to be known as the TRUSTED INNOVATOR. Last but not least, our focus remains Business Solutions. But as we've seen, business has changed a lot and this also means change the way we develop our solutions. We need to combines the advantages of the integrated suite – efficiency and low TCO – with the flexibility promise of BoB solutions. SAP is then moving to &quot;Best of Suite&quot;.
Building a Business Case for Enterprise Analytics What is the result? For the first time since the inception of business intelligence technology, organizations are now able to realize the full impact of performance management tools. The value and opportunity for enhanced business performance is obvious. Companies through the use of mySAP ERP can increase visibility for every employee and role, utilize predictive analysis to guide business decisions, leverage real-time actual data of the business to set strategy, spend more time breaking down performance measures versus constructing model and achieve first-mover advantages in their market by targeting the right customers, investing more intelligently and optimizing the price their services or products.
We are well prepared from the product side – but what about our business? What applies to products also is true for business, i.e. processes and people. One fits all doesn’t work any longer. If we want to be successful in volume business we cannot apply our way of doing business proven for the complex systems world From 2006 on we will separate both worlds of business step by step and implement new lean processes for volume business. However, we will continue to be one SAP with one strategy, one set of values and one goal: customer value. What does this mean for the CSO? Two different sales models and different set of skills: Relationship model: We improve continuously where we are already very good in: value engineering worldwide, MaxAttention for complex landscapes, a broad ISV-Ecosystem for co-innovation. Hybrid sales model: Here we cannot continue to do what we did in the past. We will add disruptive innovations to our product portfolio and answer the burning issues of short implementation time, instant usage and painless upgrades. We must add disruptive elements to the way we are doing business and reduce sales and support costs dramatically. Will be an area of major investments throughout the next 3 years.
Let‘s have a more detailed look at the functional scope of mySAP ERP. Evolving the ERP standards into the next generation, mySAP ERP not only includes the traditional functionalities in financials, human resources and operations, but expands the scope in all areas. To mention some of the highlights, with the Analytics area, mySAP ERP contains state-of-the art data warehousing capabilities, allowing quick and interactive information retrieval. mySAP ERP also includes a variety of corporate services like travel or real estate management. But also in the other area, value-add capabilities have been added, e.g. Self-Service Procurement in the purchasing area, or Strategic Enterprise Management. We will have a more detailed look at the different functionalities on the following slides.
This is what we are frequently talking about with our customers if it comes to Finance Topics: The traditional components like Financial and Management Accounting (Controlling) are still important, but the main focus here is on a tighter integration and harmonization of these both worlds. Many Customers tell us that they have historically grown systems and approaches for Financial Accounting and Controlling and have to spend huge efforts to reconcile both. There are many good reasons for such harmonization (e.g. Fast Close, Corporate Governance, Requirements for Segment Reporting according to IFRS) and consequently there is a clear trend towards that direction. Corporate Governance is a topic that became more and more important in the last years. An important driver is the Sarbanes-Oxley-Act, which is a set of sohisticated rules to which companies have to apply if they are listed at a US Stock Exchange. However also outside of the US there is a clear dendency that investors and auditors expect from an enterprise to provide evidence of the correctness of reported data and of the effectiveness of controls and transparency of management decisions. Coporate Governance leads to significant efforts in the enterprises mostly effecting the Finance Department. Efficiency in Finance is a important, especially in the context of what has been said in the prior paragraph, because new regulations cause big efforts and can be only managed with efficient processes. Cost of Finance is on the scope of many customers. Performance Management is a key topic for many enterprises, because the global competition and dynamic market environment require faster decisions then ever before. Enterprises want to leverage the information which is in most cases available but located in many fragmented information silos which do not deliver the required combined information in time and quality as a basis for decision making to a certain person.
The impressions from our customer meeting discussed on the prior slide are also confirmed by an CFO survey from Deloitte Consulting. Number one priority is to control costs in the business (Refers to Management Accounting) Another high Priority topic is decision support (refers to Performance Management) Risk Management and Internal Controls refers to Corporate Governance The topic of “reducing finance function costs” is only a small one, but it is remarkable that it appears at all – we will have a look on the next slide why.
Efficiency: If a customer chooses SAP it is a choice for best-practice processes. SAP is used by more than xxx customers and consequently SAP is the standard setter. A direct payback of that decision is, that auditors know the SAP system and will be faster than auditing a best-of-breed solution or even a self-developed solution. With SAP’s Industry Solutions also very specific processes are covered and fully integrated with the core components.
Efficiency: Within SAP we are not only talking about Integration of Financials and Controlling but also with Logistical Processes. The processes shown on the slide should not be understood as SAP specific models, but rather common flows of activities. Thus the arrows can also be understood as a flow of information, how it would ideally look like. However for customers with fragmented systems there is no way to realize such timely flow of information. With SAP you have a real time integration of all these aspects. Background information – not necessarily to be discussed in all details: Purchase Requests create a “Purchase Request Commitment” in CO. This is important because it enables Controlling to be already informed about the “plan” to purchase and can check that against current budget situation. With the help of the Cash Forecast it can even be checked against the expected budget situation at the expected payment date. This enables early alerts and control mechanisms. If the purchase request is confirmed a purchase order is created. The CO Commitment is now changed to a Purchase Order Commitment and Cash Forecast changes to a more advanced status. Goods Receipt triggers a provisional actual posting in CO and a posting into the General Ledger. Incoming Invoices can be matched against the purchase order and blocked in case of differences If released the invoice triggers an actual posting to CO and an updated Cash forecast Payment at due date is triggered in Accounts Payables with update of Cash Position in Treasury Electronic Banking provides a variety of options how to hand over the payment advice to the home bank and reconcile the home bank account with the related amounts in the SAP system.
[Note: To safe time this slide can be left out. Instead you can only explain the next one about Purchase-to-Pay] Efficiency: Within SAP we are not only talking about Integration of Financials and Controlling but also with Logistical Processes. The processes shown on the slide should not be understood as SAP specific models, but rather common flows of activities. Thus the arrows can also be understood as a flow of information, how it would ideally look like. However for customers with fragmented systems there is no way to realize such timely flow of information. With SAP you have a real time integration of all these aspects. Background information – not necessarily to be discussed in all details: Incoming Orders cause a credit check. If the incoming order is confirmed it triggers an Incoming Order forecast in Controlling and a Cash/Liquidity Forecast in Treasury. The Incoming Order forecast in CO can be selectively shown in CO reporting in addition to the billing data to gain also a picture of expected revenues. Goods issue is reflected as cost in CO. Inventory and Cost are posted in General Ledger. Optionally the goods issue posting can be made depending on an additional credit check The invoice creates an open item of the customer record and an update of the receivables item in the General Ledger. The contra item for the revenue is found automatically via customizing. The invoice updates CO-PA and Treasury. The following activities around dunning and collection and payment are part of Accounts Receivables. Electronic Banking provides a variety of options how to automatically load the incoming payment from the bank statement into the SAP system.
As a result of working with you, we have organized our thinking around four key points of emphasis in mySAP ERP Analytics – for insight and real-time decision support -> Development of long term enterprise strategies and alignment with short term business plans, Embedded analytics Financial Accounting – to deal with the mounting complexity in financial reporting -> one true reconciled version for parallel accounting Management Accounting -> Cost and Profitability Management for better business decisions The Financial Supply Chain – for better operational improvement of finance -> optimization of the cash-to-cash cycle, better visibility and control over all cash-related processes And Corporate Governance and Compliance – to reduce risk and ensure sustainable shareholder trust -> Transparent, secure and auditable accounting, Compliant to all local and international rules and regulations
The GL in mySAP ERP unifies data and functionality which were previously split over multiple ledgers and applications—such as the Classic General Ledger, Cost of Goods Sold Ledger, Profit Center Ledger, Consolidation Preparation Ledger, and other Special Ledgers. The General Ledger: Supports a unified financial and management accounting by integrating company code, profit center, functional area, transaction type, etc. into one common data structure and processing. Provides extensibility and flexibility to add industry or customer specific dimensions to standard accounting. Powerfully splits functionality for balanced books by any dimension which is important for segment and management reporting, and in many industries. Supports parallel accounting by using parallel ledgers or parallel accounts. Supports a fast close since many period-end activities are no longer required. Provides perfect transparency and reduces the risk of non-compliance – thus supporting Corporate Governance . Lowers TCO for implementing and running the General Ledger (when compared with SAP R/3). Abbreviations New GL = New General Ledger, TCO = Total Cost of Ownership IFRS = International Financial Reporting Standards, US GAAP = US Generally Accepted Accounting Standards Accnt = Account, SEG = Segment
Financial accounting with mySAP ERP Financials allows your organization to standardize all accounting dimensions on a single platform. No matter what your business, industry, or company size, SAP offers a comprehensive solution for all your accounting needs, helping you to reduce total cost of ownership and error rates while improving reporting functionality and transparency into individual dimensions of financial accounting. SAP full supports Accounts Receivable, Accounts Payable, Bank Accounting, and Cash Journal Accounting.
How does SAP impact my control structure Inherent Controls - the document principle Reporting Controls - standard or ad-hoc reports (i.e., review change of master data) Configurable Controls - automated controls set up at time of configuration (e.g., tolerances, required fields, document flow, etc.) Access Controls - user access and segregation of duties controls (From PwC Webinar) There is a shift from the traditional view of internal controls being the sole responsibility of Finance. To be effective, internal controls must be considered throughout the enterprise, and the Act recommends the establishment of a disclosure committee. CEO / CFO Quarterly and annual certification Annual assertion attested to by external auditor Department Heads Upstream processes have downstream financial impact Upstream processes impact disclosures CIO / Information Technology – Systems supporting processes must ensure data integrity
Built on SAP‘s commitment to internal controls, the audit information system (AIS) in mySAP ERP Financials offers a tool for improving the internal and external audit process. Working with SAP user groups and external auditors, SAP has designed AIS to facilitate system audit reviews, business audits of financial transactions, and tax audits using a structured, preconfigured collection of standard SAP programs and checklists. AIS easily supports offsetting account analysis, individual inquiries, and document tracing activities that can be structured in role-based sets and asssigned to auditors to further streamline the audit process. And because AIS functionality supports account-based audits, you get an easy-to-execute audit process, improved audit quality, enhanced collaboration with external auditors, and above all, a transparent audit trail.
Helping to reduce communication costs, the closing cockpit displays all closing functions on a single screen , allowing departments to work together to structure, schedule, and execute the closing process. The graphical interface uses color-coding to show the status of scheduled and completed jobs, critical paths, and detailed reports. With a transparent process, errors can be pinpointed more quickly and the repsonible employee notified immediately, further reducing surprises and unexpected downtime.
Managerial accounting flexibly supports virtually any cost accounting methodology—from simple overhead allocation to Activity Based Costing. With this approach, you can use the methodology best suited for your industry to reduce cost-of-goods-sold or operating costs, increase production or process efficiency, maximize customer profitability, or improve inventory visibility. Cost center accounting : Automatically assign simple and complex costs to cost centers and structures; Ensure transparency and clear audit trails; Complete detailed variance analysis Internal order accounting : Improve the accuracy of internal job costing; Monitor internal orders through their entire lifecycle; Complete variance analysis to understand cost overages Activity based costing (ABC): Increase transparency on the real costs of business processes, products, and customer service; Use template allocations to easily execute complex allocations; Support ABC methodology throughout the cost management process Product costing : Optimize product portfolio based on detailed cost information; Improve transparency of and control over product costs: Calculate standard and actual costs, Complete detailed variance analysis, Meet legal inventory valuation requirements Profit center accounting : Determine profit and losses for internal areas of responsibility: Use period accounting or cost of sale approach; Set accurate transfer prices to better value internal exchange of goods; Facilitate the consolidation and elimination of intercompany profits and losses; Analyze the profitability of even the smallest unit of responsibility Investment management: Support the investment decision process by improving visibility into overall investment program; Improve the speed and flow of investment information (investment request, internal order, capitalize asset under construction, seamless integration with fixed asset accounting and general ledger Profitability analysis: Identify profitability by any market segment with multi-dimensional profitability reporting: Accurately assign revenues, sales deductions, direct costs and overhead by market segment; Analyze the profitability of a market segment by product, customer, order, strategic business unit or any user-defined dimension; Layer on cost-of-goods-sold (COGS) from product cost accounting to construct a contribution margin model; Flexibly define key figures and characteristics of market segments
Financial supply chain management This is all about improving a process your business executes thousands of times a day. Each step incurs a cost: when added together, on an annual basis, translates into millions of dollars of lost opportunity for many businesses. Translates in your need to add more working capital (float) to the system. Chokes your ability to free resources for investment or growth. Enables collaboration within enterprises and within their business networks, by using defined business policies and shared services to handle all customer-related and supply-chain-related financial processes. Helps automate the financial supply chain, by using the Web and other electronic service models. This example illustrates how Financial Supply Chain Management is used to optimize the cash-to-cash cycle, by bringing together credit management, electronic bill presentment and payment, dispute management, and collections management, to name a few of the processes.
Supporting strategy and growth of the corporate enterprise is a major challenge for today‘s finance departments. In a globalized business environment and globale enterprise structures the role of the CFO is more and more the role of a „Business Integrator“. LOB representatives expect guidance how they can align their business with the corporate strategy and what KPI‘s will be relevant to finally measure their performance. The CFO needs transparency into the value drivers of the business, effective methods to manage corporate plan and strategy and to monitor execution of business strategies. The LOB Executives and mid managers need a clear understanding of the Corporate Strategy and what is expected from them how to contribute to the enterprise success. SAP provides for these purposes a complete suite of applications for Corporate Performance Management. Let‘s have a closer look into the components: With SAP Business Consolidation (SEM-BCS) we provide a complete solution for legal and for management consolidation purposes. Both aspects a tightly integrated, which means that in a common process data is consolidated along management hierarchies (typically the profit center hierarchy) as well as along hierarchies for external reporting (typically the investment hierarchy or regional groupings of subsidiaries). With that approach you will realize the famous „single version of the truth“ for internal and external reporting. An important part of CPM is Business Planning. We provide a solution which is tightly integrated with Business Consolidation, which can go in two directions: - use actual data from consolidation as starting point for the planning cycle or - use results from Business Planning as input for consolidation and simulate the corporate figures on the basis of the current plans SAP‘s planning solution is also integrated in a vertical direction: high level strategic plans can be broken down into operational plans with common tools and a common plattform. This facilitates the reconciliation of buttom up and top down planning results and shortens the overall time of the planning cycle. 3. For Performance Measurement SAP provides a lot of functionality for analytic and formatted reporting. But keep in mind: Performance Measurement is more than just reporting – it is all about having the right insight to make better decisions. Therefore SAP provides composition tools and a portal concept that enable you to put relevant information together in the right context and on the required aggregation level to finally support a certain person in decision making. 4. Withing Strategy Management the goal is to come to a global view on the enterprise situation and strategy. CPM is not just about managing financial performance – what about your customer‘s satisfaction, what about the quality of your products? Just some examples that show, that managing a company‘s strategy requires a broad view on the enterprise. SAP delivers a lot of KPI‘s the can be used within Strategy Management to setup Balanced Scorecards or to calcuate what-if-analysis using value driver trees.
For most businesses, compliance with regulatory mandates remains an overly complex and costly challenge. Even after dedicating millions of dollars to compliance initiatives, organizations can still have considerable uncertainty regarding the effectiveness of their efforts. And the costs of noncompliance can be insurmountable. Compliance with mySAP ERP : Compliance is effectively addressed by a broad set of solutions and technology. mySAP ERP helps you to effectively manage risk, compliance, and corporate governance. SAP offers a uniquely effective strategy for companies seeking to meet their immediate and long-term compliance, risk, and corporate governance needs. By combining business-process insight with an integrated technology platform, SAP can help you turn regulatory burden into competitive advantage, and realize the benefits of improved operational efficiencies and corporate transparency at a sustainable cost. Proven GRC Solutions from SAP SAP® solutions for GRC offer a holistic approach for addressing a broad range of cross-industry and industry-specific regulations. They include a comprehensive set of integrated applications that simplify – and reduce the cost of ensuring – compliance with access and authorization control mandates. These marketleading applications provide end-to-end automation for detecting, remediating, mitigating, and preventing access and authorization risk across the enterprise, resulting in lower costs, reduced risk, and better business performance. By deploying SAP applications for access and authorization control as part of an integrated GRC strategy that leverages the SAP framework for GRC, companies can proactively achieve two significant returns on their investment. First, they can address more regulatory- and business-related risks with a lower cost structure for compliance. And second, while the competition is mired in tactical compliance management, a holistic GRC approach enables organizations to create a differentiated business and achieve greater agility.
Financial Sapphire Talk
Nitin Joshi, General Manager (Services ), SAP India SAP ERP Overview
Integrated Application Framework About SAP Summary and Outlook SAP ERP - Solution Overview
SAP Strategy Fundamentals – Our Commitment Become the Trusted Innovator Move to Best of Suite SAP will be the Greatest Independent Provider of Innovative Business Solutions Focus on performance Deliver on expectations
Summary of SAP Today <ul><li>SAP AG in 2006 revenues: €9.4 billion </li></ul><ul><ul><li>More than 38,000 companies run SAP software </li></ul></ul><ul><ul><li>Providing more than 28 industry solutions </li></ul></ul><ul><ul><li>39,355 SAP employees (December, 2006) </li></ul></ul><ul><li>12 million users in 120+ countries team with us to… </li></ul><ul><ul><li>Integrate their business processes </li></ul></ul><ul><ul><li>Extend their competitive capabilities </li></ul></ul><ul><ul><li>Get a better return on investment at a lower total cost of ownership </li></ul></ul><ul><li>Unique partner ecosystem </li></ul><ul><ul><li>More than 2,200 partners </li></ul></ul><ul><ul><li>Overall more than 1 80, 000 SAP p artner c ertificates </li></ul></ul>
North America Palo Alto and satellites India Bangalore, Gurgaon Bulgaria Sofia Canada Montréal China Shanghai Israel Ra’anana Germany Walldorf and satellites SAP's Global R&D Organization Hungary Budapest
SAP in India – Glorious 11 years SAP SALES OFFICE SAP SALES OFFICE, MUMBAI SAP SALES OFFICE, CALCUTTA SAP SUPPORT OFFICE SAP LABS, GURGAON SAP SALES OFFICE SAP GLOBAL DELIVERY CENTER SAP LABS SAP INDIA HEADQUARTERS Accelerated Investments ($ 1 b) in Operations & Localization – VAT, Best Practices.. More than 4000 people strong Development team in India 1800+ customer installations 32 Leading IT companies in India are SAP partners 400+ new customer wins with 20 competitive Win Backs in 2006 High Rankings by Leading Industry Analysts - IDC, GS, Gartner, AMR etc NEW ESTABLISHED IN 1996
Best Run Businesses Run on SAP… SME and mid-market partnerships… Discrete Manufacturing flagship partnerships… Process Manufacturing flagship partnerships… Consumer & Retail flagship partnership… Services industries flagship partnerships…
Solid Penetration … Hallmark of the Leader Telecom Auto Oil & Gas E&C IT Service CPG
Integrated Application Framework About SAP Summary and Outlook SAP ERP - Solution Overview
Integration Concept Inventory Management Vendor Management Purchase Costing Accounting Treasury Integration of previously off-line functions into the operational flow is a key enabler for competitive advantage ... Cross Country ... Cross Department ... Cross Organization Indent Tender and Evaluation Goods Receipt Invoicing & Payment Forex Matching Currency Risk Budget Check Purchase Order Vendor Master Cash Management Stock Update Material Valuation Stock Available Account Updation Cost Control Cash Outflow
Solution - An integrated system design Finance Enterprise Management Asset Management Budgetary Control Human Resources Maintenance Management Management Information System Project Management Material Management
IN OUT Benefits of Integrated Application Visibility Uncertainty Common Data Model Data Redundancy Real-time Decisions Monthly Reports Performance Measures Excel Reporting Predictive Analysis Educated Guesses Process Oriented Function Oriented
Integrated Application Framework About SAP Summary and Outlook SAP ERP - Solution Overview
One Platform Strategy, But Different Markets DIFFERENT PRODUCTS DIFFERENT SALES MODELS <ul><li>RELATIONSHIP </li></ul><ul><li>Enterprise licenses </li></ul><ul><li>1/1 marketing </li></ul><ul><li>ISVs ecosystem </li></ul><ul><ul><li>One strategy </li></ul></ul><ul><ul><li>One goal </li></ul></ul><ul><li>CUSTOMER VALUE </li></ul>mySAP SAP Business One SAP All-in-One LARGE MIDSIZE SMALL <ul><li>VOLUME </li></ul><ul><li>Volume business </li></ul><ul><li>Lead generation </li></ul><ul><li>Channel partners </li></ul>
SAP ERP - Comprehensive Solution <ul><li>mySAP ERP provides the most comprehensive ERP functionality allowing the achievement of business strategies in an integrated but open and extendable architecture </li></ul>Employee and Manager Self-Services Analytics Strategic Enterprise Management Financial Analytics Workforce Analytics Operations Analytics Financials Financial Accounting Management Accounting Corporate Governance Financial Supply Chain Management Human Capital Management Employee Relationship Management Employee Lifecycle Management Employee Transaction Management Operations Purchasing Inventory Management Production Project Management Maintenance Quality Management Distribution Sales Order Management Corporate Services Travel Management Environment, Health & Safety Incentives & Commissions Corporate Real Estate SAP NetWeaver™ People Integration Information Integration Process Integration Application Platform mySAP SCM mySAP PLM mySAP SRM mySAP CRM mySAP ERP SAP NetWeaver
Today’s Business Challenges in Financials <ul><li>Accelerate Close </li></ul><ul><ul><li>Legal Requirements </li></ul></ul><ul><ul><li>Companies Act Requirements </li></ul></ul><ul><ul><li>Parallel Closings </li></ul></ul><ul><ul><li>External Reporting </li></ul></ul><ul><li>Improve Corporate Governance </li></ul><ul><ul><li>Efficient Process Controls </li></ul></ul><ul><ul><li>Risk Management </li></ul></ul><ul><ul><li>Audit Support </li></ul></ul><ul><li>Drive Efficiency in Finance </li></ul><ul><ul><li>Streamline Financial Processes </li></ul></ul><ul><ul><li>Free-up Working Capital </li></ul></ul><ul><ul><li>Decrease Cost of Finance </li></ul></ul><ul><ul><li>Centralize Finance Operations </li></ul></ul><ul><li>Increase Business Insight for Management Reporting </li></ul><ul><ul><li>Measure Profitability </li></ul></ul><ul><ul><li>Control Costs </li></ul></ul><ul><ul><li>Management Consolidation </li></ul></ul><ul><ul><li>Analysis and Reporting </li></ul></ul><ul><li>Enhance Performance Management </li></ul><ul><ul><li>Strategy Management </li></ul></ul><ul><ul><li>Budgeting and Planning </li></ul></ul><ul><ul><li>Consolidate Plan Data </li></ul></ul><ul><ul><li>Corporate Scorecards </li></ul></ul><ul><ul><li>Benchmarks and KPI’s </li></ul></ul>The responsibilities of Finance expand well beyond Financial and Management Accounting Finance Department
Priorities for Finance Source: Deloitte, CFO Survey Results 2005 <ul><li>Priorities facing the Finance Function </li></ul><ul><ul><li>Controlling costs in the business </li></ul></ul><ul><ul><li>Providing better information to support the business </li></ul></ul><ul><ul><li>Improving risk management and internal controls </li></ul></ul>
Efficiency– One Solution Covering all Financial Processes Issue Invoice Reconcile Settle & Pay Collect Cash Resolve Disputes Finance Working Capital Forecast Cash Procure Forecast Cash Reconcile Settle & Pay Approve Invoice Resolve Exception Receiving Invoice Financing working Capital Valuation for Accounting Close Preparation Audit Support Group Close Local Close Purchase to Pay Order to Cash Account to Report Share best-practice process standards with more than 25.000 customers Seemless integration with SAP‘s Industry Solutions Flexible enhancement with other components of the mySAP Business Suite Check Credit Worthiness Performance Management Define Strategy Setup Targets Align with execution Measure success Adjust Strategy Scope & Setup Document Process & Control Attest & Report Signoff, Certify & Report Test Effectiveness Assess Design & Remediate Management of Internal Control Report
Efficiency – One Integrated Approach for Logistics and Finance Controlling Purchasing Accounting Treasury Purch.req. Commit- ment Purch.ord. Commit- ment Provision Actual Actual Purchase request Purchase order Goods Receipt Cash forecast Cash forecast GL Receiving Invoice Approve Post Invoice Resolve Exception Cash forecast Cash Position Settle Payment Electric Banking Reconcile Financing Working Capital Example 1: Purchase to Pay process
Efficiency – One Integrated Approach for Logistics and Finance Controlling Sales and Distribution Electronic billing Incoming orders Goods issue Accounting Payment Dunning & Collection Treasury Electronic banking Costing Cash Positioning Example2: Order to Cash process Profitability accounting Credit review Incoming orders forecast Cash/ liquidity forecast Cash/ liquidity forecast Customer G/Ledger Credit rev. G/Ledger
The Five Key Capabilities of SAP ERP Financials Financial Accounting Management Accounting Financial Supply Chain Management Corporate Governance Corporate Performance Mgmt
Financial Accounting - General Ledger Customer Quote “ With the GL in mySAP ERP we are able to master all requirements for parallel valuation—including local GAAP and US-GAAP.” Dieter Bankosegger, HDI International <ul><li>Keep and balance multiple ledgers faster and more accurately </li></ul><ul><li>Use one unified database for financial and managerial accounting data </li></ul><ul><ul><li>Improve user productivity with uniform user interface and functionality </li></ul></ul><ul><ul><li>Reconcile reports easily </li></ul></ul><ul><ul><li>Eliminate many period-end activities </li></ul></ul><ul><li>Support multiple reporting requirements </li></ul><ul><ul><li>Use parallel accounting; segment reporting; cost of sale accounting; or profit center accounting as needed </li></ul></ul>Split Logic Multi- dimensional Multi -ledger update Multi ple valuation Multi -dimensional balancing Debit 60 40 Accnt / SEG ---------- A ---------- B ---------- A ---------- B Credit 60 40 Companies Act US GAAP xxx xxx xxx Document entry Debit 100 Accnt / SEG ---------- ---------- A ---------- B Credit 60 40 Management xxx xxx xxx xxx xxx
Financial Accounting – Subledger Effectively record and manage accounting data for all vendors Speed up and improve the customer accounting process Better manage bank master data and cash balances Improve cash journal accounting Accounts Receivable Bank Accounting Accounts Payable Cash Journal Accounting Manage the value and quantity of material stock Proactively manage asset lifecycle from acquisition to retirement Accurately account for taxes according to the legal requirements of a country/region Streamline accounting accruals Fixed Asset Accounting Tax Accounting Inventory Accounting Accrual Accounting
ERP Principles and Applications supporting Controls <ul><li>ERP Principles </li></ul><ul><ul><li>Inherent Controls </li></ul></ul><ul><ul><li>Configurable Controls </li></ul></ul><ul><ul><li>Security Controls </li></ul></ul><ul><ul><li>Reporting Controls </li></ul></ul><ul><li>ERP Applications </li></ul><ul><ul><li>Management of Internal Controls </li></ul></ul><ul><ul><li>Whistle Blower </li></ul></ul><ul><ul><li>Audit Information System </li></ul></ul><ul><ul><li>Business Consolidation </li></ul></ul><ul><ul><li>Risk Management </li></ul></ul><ul><ul><li>Management Cockpit </li></ul></ul><ul><ul><li>Balanced Scorecard </li></ul></ul><ul><ul><li>Business Planning and Simulation </li></ul></ul>
How Does ERP Handle the Challenges? mySAP Business Suite SAP NetWeaver Technology People Inherent Controls Configurable Controls Security Controls Reporting Controls Manual & Procedural Controls Business Objectives (Control Objectives & Risk)
AUDIT INFORMATION SYSTEM A I S <ul><li>Rationalize auditing with built-in controls and credibility </li></ul><ul><ul><li>Improve audit quality </li></ul></ul><ul><ul><ul><li>Select and prepare individual pieces of data with r evision-specific analysis </li></ul></ul></ul><ul><ul><li>Enhance collaboration with external auditors </li></ul></ul><ul><ul><ul><li>Download critical information for further revision </li></ul></ul></ul><ul><ul><ul><li>Meet auditing requirements of standard revision tools, such as ACL, IDEA, AuditAgent </li></ul></ul></ul><ul><ul><li>Use built-in auditing </li></ul></ul><ul><ul><ul><li>Seamlessly integrate with mySAP ERP </li></ul></ul></ul><ul><ul><ul><li>Utilize role-specific SAP reporting </li></ul></ul></ul><ul><li>Auditor’s Quote </li></ul><ul><li>“ AIS is the result of many years of intensive collaboration between SAP and auditors concerning auditing requirements. That collaboration has achieved an excellent tool for supporting auditing in SAP systems. ” W. Storm, PwC Germany, 2004 </li></ul>
Overview – Audit Management in SAP <ul><li>Processing </li></ul><ul><li>Valuation </li></ul><ul><li>Corrective and Preventive Actions </li></ul><ul><li>Documentation </li></ul><ul><li>Evaluation </li></ul><ul><li>Planning </li></ul>Audit Cycle
CLOSING COCKPIT <ul><li>Accelerate and standardize your closing process </li></ul><ul><li>Use standard closing templates for consistency across closing periods and subsidiaries </li></ul><ul><li>Accelerate the closing process and improve user productivity </li></ul><ul><ul><li>Bundle and automate closing activities </li></ul></ul><ul><ul><li>Use interactive processing for quick error correction </li></ul></ul><ul><ul><li>Automate collaboration via workflow </li></ul></ul><ul><li>Create transparency and support compliance </li></ul><ul><ul><li>Provide a perfect overview of the closing status </li></ul></ul><ul><ul><li>Drilldown to all details </li></ul></ul>Customer Quote “ We decided to use SAP because our controllers can execute the period-end closing within the SAP ERP environment more efficiently. We achieved a time reduction of 25% in the closing process.” Zeiss Optronik
Management Accounting SAP structures management accounting processes through a dedicated, best-of-breed module suite Cost Center Accounting Internal Order Accounting Activity-Based Costing Product Costing Profit Center Accounting Investment Management Profitability Analysis Managerial Accounting Managerial Accounting
Financial Supply Chain Management within mySAP ERP Financials <ul><li>- FSCM provides enhanced Tools to Improve Cash Flow and Cash Management </li></ul><ul><li>- Choose from the following options according to your individual needs </li></ul>Cash and liquidity management Electronic bill presentment and payment Collections management Dispute management Credit management Treasury and risk management Check credit-worthiness Issue invoice Reconcile Settle & pay Collect cash Resolve disputes Finance working capital Forecast cash
Corporate Performance Management Enabled by SAP <ul><li>Performance Measurement </li></ul><ul><ul><li>Financial, Workforce & Operations Analytics </li></ul></ul><ul><ul><li>Corporate KPI catalogue </li></ul></ul><ul><li>Business Consolidation </li></ul><ul><ul><li>Legal Consolidation </li></ul></ul><ul><ul><li>Management Consolidation </li></ul></ul>LOB EXECUTIVES (Strategic) Marketing Finance Sales Operations <ul><li>Mid-Term Plan </li></ul><ul><ul><li>Sales </li></ul></ul><ul><ul><li>Headcount </li></ul></ul><ul><ul><li>Budget </li></ul></ul><ul><ul><li>Maintenance Cost </li></ul></ul><ul><ul><li>… </li></ul></ul>MID-MANAGERS (Operational) <ul><li>Long-Term Plan </li></ul><ul><ul><li>Financial Statements </li></ul></ul><ul><ul><li>Cash Flow </li></ul></ul><ul><li>Strategy Management </li></ul><ul><ul><li>Balanced Scorecard </li></ul></ul><ul><ul><li>Value Based Management </li></ul></ul>CEO & Board <ul><li>Roles </li></ul><ul><ul><li>Manager Self Service </li></ul></ul><ul><ul><li>Business Unit Analyst </li></ul></ul>
What is a Balanced Score Card ? <ul><li>Balanced Score Card (BSC) is a management system </li></ul><ul><li>to model strategies, deploy them and measure </li></ul><ul><li>their execution by linking them to the right KPI. </li></ul>
Corporate Governance - mySAP ERP and SAP GRC <ul><li>- Inherent controls </li></ul><ul><li>- Configurable controls </li></ul><ul><li>- Reporting controls </li></ul><ul><li>- Security controls </li></ul>Audit information system <ul><li>Corporate Performance Management - Consolidations </li></ul><ul><li>Risks </li></ul><ul><li>Scorecards (analytics) </li></ul>Whistle-blower complains * SAP solutions for GRC are delivered and licensed separate from SAP ERP2005 mySAP ERP Stack for Sustaining Compliance: SAP Solutions for Governance, Risk and Compliance*
What SAP’s Solution does for you Today’s Business Challenges Summary and Outlook mySAP ERP Financials – Solution Overview
SAP’s Answer to todays Business Challenges in Financials <ul><li>Accelerate Close </li></ul><ul><ul><li>Subledger and General Ledger </li></ul></ul><ul><ul><li>Integrated Segment Reporting </li></ul></ul><ul><ul><li>Closing Cockpit </li></ul></ul><ul><ul><li>Intercompany Reconciliation </li></ul></ul><ul><ul><li>Business Consolidation </li></ul></ul><ul><li>Improve Corporate Governance </li></ul><ul><ul><li>Inherant or configurable controls </li></ul></ul><ul><ul><li>Reporting Controls </li></ul></ul><ul><ul><li>Security Controls </li></ul></ul><ul><ul><li>Audit Information System </li></ul></ul><ul><ul><li>Whistle Blower </li></ul></ul><ul><ul><li>SAP Solutions for GRC </li></ul></ul><ul><li>Drive Efficiency in Finance </li></ul><ul><ul><li>Best-Practice Process Standards </li></ul></ul><ul><ul><li>End-to-end Integrations </li></ul></ul><ul><ul><li>Financial Supply Chain Mgmt. </li></ul></ul><ul><ul><li>to optimize individual bottle necks </li></ul></ul><ul><li>Increase Business Insight for Management Reporting </li></ul><ul><ul><li>Profitability Analysis </li></ul></ul><ul><ul><li>Cost-Center Accounting </li></ul></ul><ul><ul><li>Activity-based Costing </li></ul></ul><ul><ul><li>Management Consolidation </li></ul></ul><ul><li>Enhance Performance Management </li></ul><ul><ul><li>Fin, Operations and HCM Analytics </li></ul></ul><ul><ul><li>Balanced Scorecard </li></ul></ul><ul><ul><li>Value Driver Tree </li></ul></ul><ul><ul><li>Business Planning </li></ul></ul><ul><ul><li>Business Consolidation </li></ul></ul><ul><ul><li>xAPP Analytics </li></ul></ul>One integrated system to gain efficiency and effectiveness:
SAP Education <ul><li>SAP Education Welcomes you to a whole new, learner-centric approach to training </li></ul><ul><li>A range of highly interactive Web-based courses </li></ul><ul><li>delivering effective knowledge transfer </li></ul><ul><li>wherever and whenever it’s needed … </li></ul>
SAP Online Education – Details <ul><li>Why online education? </li></ul><ul><ul><li>Candidates can start their training as per their convenience and don’t need to wait for a scheduled batch. </li></ul></ul><ul><ul><li>Candidates can allocate time for their training at their convenience. </li></ul></ul><ul><ul><li>No additional cost in terms of travel and accommodation since contact centers available in almost all the cities. </li></ul></ul>
SAP Online Education – Details <ul><li>How does the learning happen? </li></ul><ul><li>Through SAP authorized contact centers in various cities. </li></ul><ul><li>Why this mode of learning will be effective ? </li></ul><ul><li>No difference in an ILT and an Online course </li></ul><ul><li>Certification similar to that of the ILT courses </li></ul><ul><li>Infrastructure in sync with the SAP Education ILT centers </li></ul>
E-Learning Course Fee per Module for ICAI ONLY Rs.70,000/Module* * Tax – 12.36%
SAP Online Education – Student <ul><li>REGISTRATION </li></ul><ul><li>All Payments are to be made to ICAI in form of DD in favor of “Secretary ICAI” payable at Delhi. </li></ul><ul><li>Students send along with DD 2 passport size photographs , </li></ul><ul><li>Self attested photocopy of member ship cert or student registration letter . </li></ul><ul><li>Photo copy of ID </li></ul><ul><li>Enroll online on www.ICAI.org or contact center </li></ul><ul><li>** Final year students or members or CA to enroll only </li></ul><ul><li>[email_address] </li></ul>