Advantages of sap

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Title: Advantages of SAP
Tags: Enterprise systems assignment help, Enterprise systems, SAP assignment help, SAP, SAP
software, Advantages of SAP, Enterprise System Application Software
Description: If you are looking for Advantages of using SAP (Enterprise System Application
Software) in producing the legally required financial statements, then you can check the
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Category: Application Software Assignment Help

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Advantages of SAP

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Advantages of using SAP (Enterprise System Application Software) in producing the
legally required financial statements
Enterprise systems (ES) are referred to as business usage application software packages
that help various business processes, information flows, analyzing the data collected and also
reports on the analysis made. Enterprise system application software of financial module are
available both in readymade and customized form. SAP is the typical form of ES application
software that can be used in solving various business needs. The financial accounting module of
SAP in made in such a way that it shows the enterprise business transaction in such a manner
that complies with the external reporting requirement (SAP Service and Support Expert in the
Center of Expertise, Active Global Support, 2010). This module of Sap has capability to track
and report on multiples enterprises across many countries and it also supports multiple languages
and currencies to make the work easy. The financial module in SAP also has the facility to
integrate with the sale and distribution, purchasing and management of raw materials, which
helps the user to locate the original transaction in easier manner whether it is sales order or
purchase order. It has been said that SAP FI (Financial Module) is the central point of the
integrated SAP system as there is financial impact on all other business process that results to
some flow of information to the financial module (O’Brien, 2011). The biggest advantage of
using the SAP financial module is its system integration with other application modules of
business information system. Using SAP, one can easily read, appraise, and respond to the
changing business situations and helps to prepare legally required financial statements.
In addition to the above benefits SAP also allows better transparency while preparing the
financial statements that increase the corporate governance. The main advantage is that SAP

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financial module comes with preloaded accounting standards, federal regulations that help in
improving the administration of internal controls. The SAP FI has the unique ability to manage
the cash across the countries, location and companies (Khoshnevis, 2009). The benefit of using
the SAP is endless. SAP Fi deals with the wide range of governance practices and also the
supported compliance issues like compliance to the Sarbanes-Oxley, segregation of duties, IFRS,
countries GAAP and other legal regulations of respective countries. On analyzing the benefit of
using the SAP FI (ES application software) it can be said that it can help in producing the legally
required financial statements.
Issues faced by the global firms while using an ES for the production of group and/or entity
financial statements
There are many problems that have to be faced while using the SAP for the recording,
analyzing and recording of the financial transaction in order to produce the financial statement of
the entity or company. As it is the main requirement that financial statement of the company or
entity must be according to the domestic GAAP that have compliance with the IFRS
(International accepted accounting standards). There is individual GAAP for the respective
countries and it is very hard to make adherence with these separate GAAP while making the SAP
software. Therefore module makes let the provision for the user to make required changes as
their requirement (BEng, 2004). The main challenge is the SAP installation in the organization.
There are some basic requirements in the SAP installation, if not fulfilled leads to complete
failure of the enterprise resource planning. There is inflexibility of using the SAP module in the
company as the vendor software packages may or may not fit company’s business module and it
is true that customized software leads to high expenditure. It is true that SAP comes with very

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total cost of ownership that includes the acquisition cost, deployment cost and other maintenance
cost. While integrating SAP financial module with other modules of the enterprise it may lead to
error as it cannot be possible for readymade software to be easily integrate with the available
resources of the company. Legally correct financial statements required full compliance with the
domestic GAAP and IFRS but the truth is that it is not possible through using ant ES application
software. Entity has to bear regular updating cost of the SAP application software that leads to
increase in the overall cost (ERP Workshops, 2011). There is also risk of steal of data as all the
information has made available online that can be accessed from anywhere connected to the
server of the company. To made data under protection company has to bear addition cost of
implementing various internal and external control measures to avoid the risk of data steal.

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References
2011 ERP Workshops. [Online]. Available at:
http://big.computing.dcu.ie/information/sap_workshopmay2011.pdf [Accessed on: 1
December 2014].
BEng, A.M. 2004. A Framework for Adaptive Monitoring and Performance Management of
Component-Based Enterprise Applications. [Online]. Available at:
http://doras.dcu.ie/18093/1/Adrian_Mos_20130116123408.pdf [Accessed on: 1
December 2014].
Khoshnevis, S. et.al. 2009. Model Driven Approach to Service Oriented Enterprise Architecture.
[Online]. Available at: http://www.computing.dcu.ie/~pjamshidi/PDF/APSCC2009-1.pdf
[Accessed on: 1 December 2014].
O’Brien, T. 2011. Creating and Sustaining Data Quality within diverse Enterprise Resource
Planning and Information Systems. [Online]. Available at:
http://dataquality.computing.dcu.ie/thesis/OBrien_Tony_2011.pdf [Accessed on: 1
December 2014].
SAP Service and Support Expert in the Center of Expertise, Active Global Support. 2010.
[Online]. Available at: http://www.dcu.ie/alumni/job_spec/vacancy_sap1.pdf [Accessed
on: 1 December 2014].

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