Tackle Changes to Inventory, Cash Flow, and Benefit Regulations with SAP ERP

  • by Kehinde Eseyin, Security Architect
  • December 30, 2009
Review some accounting standard changes, including changes to foreign exchange rates, inventory, and benefits, and see how the SAP ERP system can address them.
Key Concept
The driver of International Financial Reporting Standards (IFRS) and International Accounting Standards (IAS) is the need to bring uniformity and consistency to accounting practices and reporting across the globe. SAP is conscious of this business need and has continually enhanced and adapted its functionalities to meet the dynamics of global accounting and financial reporting requirements.

The coming changes to financial accounting standards mean that you need to reconsider how SAP ERP software addresses regulatory changes. The most prominent change is International Financial Reporting Standards (IFRS). IFRS is widely based on International Accounting Standards (IAS), but with some changes.

I’ll review how the SAP ERP system can address some elements of IFRS and IAS standards, including:

  • Financial Instruments: Presentation (IAS 32)
  • Financial Instruments: Recognition and Measurement (IAS 39)
  • Financial Instruments: Disclosures (IFRS 7)
  • Foreign Exchange Rates (IAS 21)
  • Financial Reporting in Hyperinflationary Economies (IAS 29)
  • Cash Flow Statement (IAS 7)
  • Inventories (IAS 2)
  • Employee Benefits (IAS 19)
  • Share-Based Payments (IFRS 2)

Some of the functionalities that can help you enhance IFRS compliance include multi-currency support, SAP Hedge Management, SAP Exposure Management, SAP Balance Analyzer, SAP Market Risk Analyzer, SAP Payroll, and SAP Liquidity Planner.

Kehinde Eseyin

Kehinde Eseyin is a security architect. He holds a bachelor’s degree in computer science. He has about 12 years of IT security, governance framework, IS risk, and compliance experience gained by working in numerous global organizations. Over the years, he has demonstrated competencies in security design, information assurance, cyber security, data privacy, threat and vulnerability management, penetration testing, business architecture, project management, IT audit, IS controls framework, and identity and access management.
 

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