Simplify Segment Reporting with the New General Ledger

  • by Aylin Korkmaz, Manager, Accenture UK
  • November 15, 2005
Find out how the new General Ledger (G/L) in mySAP ERP differs from the classic G/L. With its new segment functionality, you do not need to create a Special Purpose Ledger to meet different compliance standards.
Key Concept
One of the requirements of International Financial Reporting Standards (IFRS) is to report financial information by line of business and by geographical area, which is known as segment reporting compliance. It applies to enterprises whose equity or debt securities are publicly traded and to enterprises in the process of issuing securities to the public. Previous SAP releases contained various complex ways to provide this compliance, but the new General Ledger (G/L) available in mySAP ERP offers better quality and modeling of segment reporting.

Beginning with mySAP ERP 2004, SAP introduced new General Ledger (G/L) functionality. In this article, I’ll explain the key differences between the new G/L and the conventional G/L as well as the new G/L functions that support segment reporting. Subsequent articles will describe other new features, including parallel valuation supported with parallel ledgers and new processes that speed up your period-end closing.

I’ll focus on the integration in the new G/L of functionality that used to be in separate ledgers. You now can use a new standard account assignment object called “segment” and new G/L functions to comply with the requirements of the internationally accepted accounting frameworks such as International Financial Reporting Standards (IFRS) and US Generally Accepted Accounting Principles (US GAAP) for segment reporting.

In spite of the convergence initiatives of the accounting frameworks, accounting practices including segment reporting still differ. The major differences are in the segment definition, accounting policies, and disclosure of segment information. For example, segment definition is based on risk and return profiles along with internal reporting structure in IFRS, whereas it is based on internally reported operating segments in US-GAAP.

Aylin Korkmaz

Aylin Korkmaz is a manager in Accenture’s Global Energy practice specializing in finance streamlining and management reporting. She has seven years of experience working in global multi-stream projects containing challenging business process designs and change management issues. Aylin has deep process architecture and design skills, and is one of Accenture’s leading practitioners in the area of Financial and Strategic Enterprise Management modules. She has led design and configuration teams within complex SAP solution environments and delivered cutting-edge finance and business intelligence solutions.

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