Nowadays, the general ledger in SAP R/3 is quite fragmented. SAP customers currently have to implement several SAP components in order to meet international and/or industry-specific standards. To get round this, a new flexible solution for the general ledger has been created in mySAP ERP. It combines the general ledger modules including the cost-of-sales ledger, profit center accounting, special purpose ledger and the consolidation ledger. The new general ledger is built on a “broader”, standardized database, and aspects such as the general ledger account, functional area and profit center are grouped together in one data record. This enhances the quality of data, reconciliation measures become unnecessary and the period-end closing processes are quicker to carry out. In short, the new general ledger helps to reduce the total cost of ownership considerably.
Stock-exchange listed companies are bound by accounting regulations such as the International Financial Reporting Standards (IFRS) when it comes to consolidated financial statements, but local regulations still apply to the individual accounts. Parallel accounting has increased in importance over the past years. But where and how should the values for the different accounting regulations be efficiently recorded, stored, and made available for reporting?
Up till now, SAP R/3 offered three possibilities – accounts, special purpose ledger and company codes. The accounts solution is the one used by the majority of customers and is the option recommended by SAP. For customers with a very large number of accounts with valuation differences, one alternative to the account solution was to maintain a “parallel” ledger to the main ledger in the Special Ledger application. Users are advised against using the company codes solution, since this is only supported by asset accounting and is not being further developed by SAP.
A fourth option will be available in mySAP ERP from 2004 onward with the new general ledger. It will enable several ledgers to be represented, provided with content through a standardized posting transaction (e.g. FB50) or analyzed for e.g. balance sheet or profit and loss account (GuV, RFBILA10) with standardized reporting. The new “ledger group” field in the document header determines which ledger is posted to in the case of manual postings. Where values are provided by the contributory accounting unit, for example in the transaction manager of SAP Treasury and Risk Management, different values are ascertained for each valuation area or accounting regulation, and transferred to the relevant ledger group of the new general ledger.
As a result of the additional legal requirements of IFRS or the US GAAP, which demand segment reporting in financial statements, the new general ledger is to be supplied with a new “segment” feature. This can either be completed manually, using substitution or by employing profit center derivation. Customer-specific fields can also be depicted with considerable flexibility. The technology that was already available in the SAP R/3 special purpose ledger for extensions, has been adapted for the new general ledger. It is therefore possible to add extra fields to the system for postings, planning, allocations and analyses.
Online document breakdown
Document enhancement (online split) will also be possible in the new updated general ledger. The objective of this feature is to project account assignment objects into document rows where they were not originally assigned, for example the profit center from the expenditure items in the liabilities row. This increases the transparency of the postings and enables the creation of additional internal balance sheets. A compound entry for subsequent charging of the balance sheet and profit and loss account is therefore no longer necessary because all information is already available at document level.
Transition to mySAP ERP
Users changing from SAP R/3 to mySAP ERP will find that their general ledger is not affected at first. At client level, a “switch” offers the option of continuing to use the traditional general ledger or activating the new general ledger. The new general ledger is therefore optional. The new summary and line item databases are automatically updated when the new general ledger is activated. The document files BKPF and BSEG are not transferred as they too are part of the new general ledger. The standard reports “recognize”, in the case of year-by-year comparisons for example, whether data exists in the new summary databases or whether this is still in the “old” database.
The transition from the classical general ledger to the new system can be very simple or highly complex, depending on the initial system and the results the customer expects. To support customers and consultants, SAP is currently drawing up a manual describing procedures for the most common transition scenarios and the reports that are available. This handbook will also contain information on experiences gathered from customer ramp-up projects.