1. Glossary

Workload Automation and Job Scheduling Glossary

Explore commonly used Workload Automation and Job Scheduling terms.

Account reconciliation

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Account reconciliation ensures the accuracy of financial records by matching the balances in an organization's accounting records with external sources such as bank statements. It identifies discrepancies and confirms the correctness of transactions recorded. This process is especially critical during the month-end close to ensure all financial activities are accounted for accurately.

Accounts receivable

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Accounts receivable refers to the funds a company is due from its customers for goods or services provided on credit. This asset is expected to be converted to cash within one year and is crucial for maintaining cash flow.

Accrual accounting

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Accrual accounting is a financial reporting method in which revenues and expenses are recorded when earned or incurred, regardless of when the cash is received or paid. This approach accurately represents a company's financial position by matching income and expenses to the relevant accounting period. It offers a clearer view of its economic performance over time.

Accrual basis accounting

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Accrual basis accounting is a method in which revenues and expenses are recorded when earned or incurred, regardless of when the cash is received or paid. This approach contrasts with cash-based accounting, offering a more comprehensive view of a company's financial activities by recognizing transactions as they occur rather than when cash changes hands.

Accrued expenses

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Accrued expenses refer to costs that have been incurred but have not been paid. These expenses are recognized on the income statement when incurred, regardless of when the payment is made. Common examples include salaries, utilities, and interest expenses, which accumulate over time and are typically recorded as liabilities until settled.

Accrued interest

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Accrued interest is the amount accumulated on a financial obligation but has yet to be paid or received. This interest is typically recorded as a liability by the borrower and as an asset by the lender until it is settled. Accrued interest is commonly associated with loans, bonds, and other interest-bearing financial instruments.

Accrued revenue

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Accrued revenue is income that has been earned but has yet to be received. This revenue is recognized on the income statement when earned, regardless of when the payment is received. Common examples include service fees, rent, and interest income, which accrue over time and are typically recorded as assets until collected.

Adjusting entries

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Adjusting entries are journal entries made at the end of an accounting period to update accounts and ensure that financial statements reflect accurate information. These entries are necessary to account for transactions that have occurred but have not been recorded, such as accrued expenses or unearned revenue. Adjusting entries is crucial for maintaining the accuracy of financial records and preparing financial statements using generally accepted accounting principles (GAAP).

Find out more about journal entry including the process, common challenges and how to overcome them.

Analytics Cloud

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Analytics Cloud is a tool that combines data analysis and planning features to help organizations use key business applications and data sources more effectively for informed decision-making.

AP automation

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AP automation refers to using technology to streamline and automate accounts payable processes. This includes invoice processing, payment approval workflows, and vendor management. Organizations can improve efficiency, reduce errors, and gain better control over their cash flow and financial obligations by automating these tasks.

Approval workflow

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Approval workflow is a systematic process used to route documents, requests, or transactions through various stages of review and approval within an organization. In finance, approval workflows are commonly used for authorizing expenditures, verifying invoices, and approving financial transactions. These workflows help ensure compliance with internal policies and procedures while providing transparency and accountability in the approval process.

Automate approval workflows and audit trails for seamless, compliant recording.

Balance sheet

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A balance sheet is a financial statement that provides a snapshot of a company's financial position at a specific time. It summarizes the company's assets, liabilities, and shareholders' equity, showing what it owns and owes. The balance sheet follows the accounting equation: Assets = Liabilities + Shareholders' Equity, providing investors, creditors, and other stakeholders valuable insights into the company's financial health and stability.

Discover how you can save your accounting teams hundreds of unnecessary hours spent on manual tasks with an automation solution.

Balance sheet reconciliation

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Balance sheet reconciliation is comparing the balances of a company's accounting records for assets, liabilities, and equity against external sources to ensure accuracy and consistency. This process involves identifying and resolving discrepancies or errors between the accounting records and the supporting documentation, such as bank statements, invoices, and financial statements. Balance sheet reconciliation is essential for verifying the integrity of economic data and detecting potential errors or fraud.

Bank reconciliation

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Bank reconciliation is comparing a company's internal financial records, such as cash accounts and transactions, with the records provided by its bank to ensure accuracy and consistency. This process involves identifying and resolving discrepancies between the two documents, such as unrecorded transactions, bank errors, or timing differences. Bank reconciliation is essential for maintaining the integrity of financial data and ensuring the accuracy of financial statements.

Business Data Cloud (BDC)

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SAP Business Data Cloud is a fully managed SaaS solution that unifies and governs SAP data, connects to third-party sources and provides context for decision-making across business areas.

Business Technology Platform (BTP)

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SAP Business Technology Platform supports RISE with SAP and S/4HANA Cloud by unifying development, data, analytics, integration and AI to extend and optimize SAP systems.

Business Warehouse (BW)

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SAP Business Warehouse is an SAP data warehousing solution that collects, integrates and consolidates data from SAP and non-SAP sources to support reporting, analysis and informed business decisions.

BusinessObjects

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BusinessObjects is an on-premises business intelligence suite for reporting, data visualization and sharing that helps convert data into insights across SAP's Business Technology Platform.

Certification

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Certification is a program that validates expertise in SAP solutions through credentials recognized globally, confirming that defined SAP standards for knowledge or technical capability are met.

Certification of accounts

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Certification of accounts is the process of formally verifying the accuracy and completeness of financial statements by a qualified individual or entity. This certification assures stakeholders that the financial statements have been prepared per relevant accounting standards and accurately represent the organization's financial position and performance. External auditors often perform accounts certification, which may be conducted by internal accounting personnel or other authorized individuals.

Chart of accounts

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A chart of accounts is a structured list of all the accounts a company uses to record its financial transactions and prepare its financial statements. Each account is assigned a unique identifier and categorized according to its nature, such as assets, liabilities, equity, revenues, and expenses. The chart of accounts provides a standardized framework for organizing and classifying financial data, facilitating accurate record-keeping, financial reporting, and analysis.

Standardize journal entry creation while automatically managing approvals, calculations, validations and ERP postings.

Clean core

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Clean core refers to an ERP system built on standard elements with limited customizations, allowing for easier updates and use of cloud-compliant extensions.

Closing entries

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Closing entries are journal entries made at the end of an accounting period to transfer the balances of temporary accounts, such as revenues and expenses, to permanent accounts, such as retained earnings. This process effectively resets the temporary accounts to zero in preparation for the next accounting period. Closing entries ensure that the company's financial statements accurately reflect its financial performance for the period and comply with generally accepted accounting principles (GAAP).

Cloud Connector

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Cloud Connector links SAP BTP to on-premises systems using a secure reverse proxy, allowing controlled access without changing firewall rules or exposing internal systems directly to the cloud.

Cloud Foundry

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Cloud Foundry is an open-source application runtime on SAP BTP that supports building and running cloud applications using multiple languages, frameworks and services on scalable hyperscaler infrastructure.

CPI for Data Services

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CPI for Data Services is an ETL tool used to move and convert data between on-premises and cloud systems on a scheduled basis, supporting both SAP and non-SAP targets.

Databricks

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Databricks in SAP Business Data Cloud combines application data with AI, ML and data engineering to enable analytics at scale, while preserving business context across SAP and non-SAP sources.

Datasphere

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SAP Datasphere is a cloud-based solution that combines data integration, cataloging, modeling, warehousing and virtualization across SAP and non-SAP systems in one unified service.

Deferred revenue

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Deferred revenue, also known as unearned revenue or prepaid revenue, refers to income received in advance of the delivery of goods or services. This revenue is recorded as a liability on the balance sheet until the goods or services are provided to the customer. At this point, it is recognized as revenue on the income statement. Deferred revenue represents an obligation to fulfill future obligations and is common in industries such as subscription-based services, software licensing, and prepaid memberships.

Double-entry accounting

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Double-entry accounting is a bookkeeping method that requires every financial transaction to be recorded in at least two accounts, with equal and opposite debits and credits. This ensures that the accounting equation (Assets = Liabilities + Equity) remains balanced after each transaction. Double-entry accounting provides a systematic and accurate way to record and track financial transactions, enabling businesses to maintain accurate financial records and prepare reliable financial statements.

Automation tools enhance financial reporting and support processes like double-entry accounting to improve the accuracy of financial statements.

Endorsed App

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Applications that have achieved invitation-only validation from SAP, requiring deep security, performance and integration testing.

Enterprise Cloud Services (ECS)

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SAP Enterprise Cloud Services provides managed operations for RISE with SAP, handling infrastructure and system management so customers can focus on core business needs.

Entity close

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Entity close is finalizing the financial records and preparing financial statements for a specific legal entity within a larger organization. This process involves reconciling accounts, adjusting entries, and generating financial reports by relevant accounting standards and regulatory requirements. Entity close is typically performed at the end of each accounting period to ensure the accuracy and completeness of the financial information for that entity.

Discover how organizations can accelerate the entity close stage with automation.

ERP Central Component (ECC)

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SAP ERP Central Component (ECC) and R/3 refer to legacy SAP ERP platforms still widely used in hybrid environments that require clean, governed connectivity to SAP Business Technology Platform (BTP) and cloud applications during cloud transformations.

Expense accruals

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Expense accruals refer to costs incurred but have not been paid or recorded in the accounting records. These expenses are recognized on the income statement when incurred, regardless of when the payment is made. Expense accruals help ensure that expenses are appropriately matched with their revenues, providing a more accurate representation of a company's financial performance.

External audit

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External audits are conducted by an independent auditor from outside the organization to provide an opinion on the fairness and accuracy of the company's financial statements. External auditors are typically certified public accountants (CPAs) or chartered accountants not affiliated with the organization being audited. They examine the financial statements and supporting documentation to ensure compliance with accounting standards and regulatory requirements. To ensure the financial statements' reliability, external audit reports are provided to shareholders, creditors, and other stakeholders.

Financial close

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Financial close, also known as the accounting close or month-end close, is the process of finalizing the financial records for a specific accounting period and preparing financial statements. This process involves reconciling accounts, adjusting entries, and reviewing financial data to ensure accuracy and completeness. Financial close is typically performed at the end of each accounting period to facilitate financial reporting, analysis, and decision-making.

Financial consolidation and close

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Financial consolidation and closing combine and reconcile the financial results of multiple legal entities or business units within a larger organization to produce consolidated financial statements. This process involves eliminating intercompany transactions and balances, adjusting for differences in accounting policies and reporting currencies, and ensuring compliance with relevant accounting standards and regulatory requirements. Financial consolidation and closing give stakeholders a comprehensive view of the organization's economic performance and position across all its subsidiaries and divisions.

See how to fully automate and optimize tasks related to reconciliation, reporting and other financial consolidation processes.

Financial operations

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Financial operations are the activities and processes in managing an organization's economic activities. This includes budgeting, forecasting, cash flow management, and financial reporting. Effective financial operations ensure financial stability and success by optimizing resource allocation, minimizing risks, and maximizing profitability.

Financial operations management

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Financial operations management oversees and optimizes an organization's financial activities and processes to achieve its strategic objectives. This includes financial planning, budgeting, expense management, and performance analysis. Financial operations management aims to improve efficiency, transparency, and control over financial resources, enabling organizations to make informed decisions and achieve their financial goals.

Financial operations transformation

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Financial operations transformation refers to the strategic initiative undertaken by organizations to fundamentally change and improve their financial operations processes, systems, and capabilities. This may involve implementing new technologies, redesigning processes, and restructuring organizational roles to achieve greater efficiency, agility, and effectiveness in managing financial activities. Financial operations transformation is driven by the need to adapt to changing business environments, drive innovation, and enhance competitive advantage.

Financial performance analysis

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Financial performance analysis evaluates and interprets a company's financial results to assess its profitability, efficiency, liquidity, and solvency. This analysis involves comparing financial metrics such as revenue, expenses, profit margins, and return on investment over time or against industry benchmarks. Financial performance analysis helps stakeholders, including investors, creditors, and management, to understand the company's financial health, identify areas for improvement, and make informed decisions.

Financial reconciliation

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Financial reconciliation is comparing and matching two sets of financial records to ensure they are accurate and consistent. This may involve reconciling bank statements with internal cash records, reconciling accounts receivable with customer payments, or reconciling inventory records with physical counts. Financial reconciliation helps identify discrepancies, errors, or fraud, ensuring financial data's integrity and financial reporting's reliability.

Financial statement

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A financial statement is a formal document that summarizes a business entity's economic activities and position. The main types of financial statements include the balance sheet, income statement, statement of cash flows, and statement of changes in equity. These statements provide valuable information about a company's assets, liabilities, equity, revenues, and expenses, enabling stakeholders to assess its financial performance and make informed decisions.

General ledger

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A general ledger is a central accounting record containing all a business entity's financial transactions, organized by account. Each transaction is recorded as a journal entry, with debits and credits corresponding to the affected accounts. The general ledger is the foundation for preparing financial statements and provides a comprehensive overview of the company's financial activities over a specified period.

General ledger reconciliation

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General ledger reconciliation is comparing and matching the accounts balances in the general ledger with subsidiary records or external sources to ensure accuracy and consistency. This process involves identifying and resolving discrepancies or errors, such as posting mistakes, timing differences, or unauthorized transactions. General ledger reconciliation is essential for maintaining the integrity of financial data and preparing accurate financial statements.

Group consolidation

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Group consolidation combines and integrates the financial results and position of multiple subsidiary companies or business units into a single set of consolidated financial statements. This process involves eliminating intercompany transactions and balances, adjusting for differences in accounting policies and reporting currencies, and ensuring compliance with relevant accounting standards. Group consolidation provides stakeholders with a comprehensive view of the financial performance and position of the entire group, enabling better decision-making and transparency.

GROW with SAP

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GROW with SAP helps new customers move to cloud ERP faster using a tailored approach. It supports AI adoption across finance, supply chain and HR to enable scalable and sustainable business growth.

IFRS

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IFRS stands for International Financial Reporting Standards, a set of accounting standards developed and maintained by the International Accounting Standards Board (IASB). Companies worldwide use IFRS to prepare their financial statements and ensure consistency and comparability in financial reporting. IFRS aims to provide transparent, high-quality financial information that is relevant and reliable for investors, creditors, and other stakeholders.

Industry Solutions

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Industry-specific applications designed to support regulated, complex or verticalized operations with built-in best practices.

Integrated audit

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An integrated audit is a comprehensive examination of a company's financial statements and internal controls conducted by an independent auditor. This type of audit combines the review of financial information with an assessment of the effectiveness of internal controls over financial reporting. Integrated audits aim to assure the reliability of financial statements and the integrity of financial reporting processes.

Discover how to prevent a bad audit with 4 things you should address.

Integrated Business Planning (IBP)

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A cloud-based supply chain solution that supports planning for sales, demand, supply, inventory and replenishment using analytics and simulations.

Integration Suite

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SAP Integration Suite is a cloud-based iPaaS that connects SAP and third-party systems, enabling data exchange and process integration across cloud and on-premises environments.

Intercompany accounting

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Intercompany accounting involves recording and reconciling financial transactions and balances between different entities or subsidiaries within the parent company. These transactions can include intercompany sales, transfers of assets, loans, and payments. Intercompany accounting ensures that transactions between related entities are correctly accounted for and eliminates any double-counting or misstatement of financial results.

Intercompany analysis

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Intercompany analysis involves examining and evaluating the financial relationships and transactions between different entities or subsidiaries within a group. This analysis helps identify trends, patterns, and discrepancies in intercompany transactions, enabling management to assess each entity's financial performance and operational effectiveness. Intercompany analysis is crucial for understanding the group's economic health and performance.

Intercompany financial management

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Intercompany financial management encompasses the processes and practices used to manage financial relationships and transactions between entities or subsidiaries within a group. This includes establishing intercompany policies, procedures, and controls to ensure transparency, accuracy, and compliance with regulatory requirements. Intercompany financial management aims to optimize cash flow, minimize risks, and maximize value creation within the group.

Intercompany invoice

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An intercompany invoice is a billing document that records and documents transactions between different entities or subsidiaries within the same parent company. This invoice typically includes details such as the description of goods or services provided, quantities, prices, and payment terms. Intercompany invoices facilitate the proper recording and reconciliation of intercompany transactions, ensuring accurate financial reporting and compliance with internal policies and external regulations.

Intercompany journal entry

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An intercompany journal entry is a financial transaction in the accounting records of two or more related entities or subsidiaries within the parent company. These entries are used to transfer funds, assets, or liabilities between entities, adjust intercompany account balances, or allocate expenses or revenues. Intercompany journal entries ensure financial transactions between related entities are correctly accounted for and reflected in the consolidated financial statements.

Intercompany reconciliation

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Intercompany reconciliation compares and reconciles financial transactions and account balances between different entities or subsidiaries within the same parent company. This process involves identifying and resolving discrepancies, errors, or inconsistencies in intercompany accounts, such as receivables, payables, and equity balances. Intercompany reconciliation ensures the accuracy and integrity of financial data and facilitates the preparation of consolidated financial statements.

Intercompany transactions

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Intercompany transactions are financial transactions that occur between different entities or subsidiaries within the same parent company. These transactions include selling goods or services, transferring assets or liabilities, loans, dividends, or payments for shared expenses. Intercompany transactions must be appropriately recorded, documented, and reconciled to ensure accurate financial reporting and compliance with internal policies and external regulations.

Internal audit

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An internal audit is an independent, objective assurance and consulting activity designed to add value and improve an organization's operations. It helps an organization accomplish its objectives by taking a systematic, disciplined approach to evaluating and enhancing the effectiveness of risk management, control, and governance processes. Internal auditors are employees of the organization and report to its management.

Invoice management

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Invoice management refers to receiving, reviewing, processing, and tracking invoices from vendors or suppliers. This includes tasks such as verifying the accuracy of invoices, matching them to purchase orders or contracts, obtaining necessary approvals for payment, and recording them in the accounting system. Invoice management helps organizations ensure timely payment of obligations, avoid late fees or penalties, and maintain accurate financial records. It may also involve implementing automation tools or systems to streamline the invoice processing workflow and improve efficiency.

Invoice processing

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Invoice processing refers to the systematic handling of invoices from receipt to payment within an organization. This process involves capturing, validating, approving, and reconciling invoices before they are paid. Automated invoice processing systems can streamline these tasks by extracting data from invoices, routing them for approval, and integrating them with accounting software for payment processing. Effective invoice processing helps organizations manage cash flow, optimize vendor relationships, and maintain accurate financial records.

Invoice to cash

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Invoice to cash, also known as "order to cash," manages the entire lifecycle of a customer order, from the initial order placement to the payment collection. This process typically includes order entry, credit approval, order fulfillment, invoicing, and payment collection. Invoice-to-cash processes aim to streamline and automate the order-to-payment cycle, reduce errors, minimize delays, and improve cash flow management.

Journals

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Journals, or "journal entries," are accounting records used to record financial transactions in a company's general ledger manually. Each journal entry includes a description of the transaction, the accounts affected, and the amount debited or credited to each account. Journals are typically organized by date and serve as the primary source of information for posting transactions to the general ledger. Common types of journals include sales journals, purchase journals, cash receipt journals, and cash disbursement journals.

Local entities

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Local entities are business units, subsidiaries, or divisions operating within a specific geographic region or jurisdiction. They are typically distinct legal entities with management, operations, and financial reporting requirements. Local entities may operate independently or as part of a larger corporate structure, subject to local laws, regulations, and taxation policies. Managing local entities requires coordination, communication, and corporate policies and standards compliance.

Modern accounting

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Modern accounting uses advanced technologies, processes, and practices to effectively manage financial information and reporting. This includes adopting cloud-based accounting software, automation tools, data analytics, and artificial intelligence to streamline accounting processes, improve accuracy, and enhance decision-making. Modern accounting aims to provide real-time insights, increase efficiency, and adapt to changing business environments and regulatory requirements.

Month-end close

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Month-end close is the process of finalizing the financial records and preparing financial statements at the end of each accounting period, typically every month. This process involves reconciling accounts, adjusting entries, and reviewing economic data to ensure accuracy and completeness. Month-end close is essential for timely financial reporting, analysis, decision-making, and compliance with regulatory requirements and internal policies.

NetWeaver

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SAP NetWeaver is an application server platform that runs ABAP or Java. It uses systems and instances to manage how SAP applications are deployed and operated.

Production planning

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Production planning is the process of aligning demand, materials, capacity and production schedules so manufacturers can decide what to produce, when to produce it and at what scale. Production Planning (PP) is a core module in SAP that manages manufacturing activities.

Profit and loss

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Profit and loss, also known as the income statement, is a financial statement that summarizes a company's revenues, expenses, and net income or loss for a specific period, such as a month, quarter, or year. The profit and loss statement shows the company's ability to generate profits from its operations by comparing revenue earned with expenses incurred during the period. It provides valuable insights into the company's financial performance and profitability.

Achieve a seamless financial close with financial month-end close checklist automation software.

Provisions

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Provisions are liabilities recorded on the balance sheet to account for probable future expenses or losses that are not yet certain in amount or timing. Examples of provisions include warranty provisions, restructuring provisions, and legal provisions. Provisions are recorded based on estimates and adjusted over time as more information becomes available. Recording provisions help ensure that financial statements reflect the company's obligations accurately and fairly.

Reclassifications

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Reclassifications refer to transferring amounts from one accounting category or account to another within an organization’s financial records. This may involve moving expenses from one expense account to another, reallocating revenues between different revenue streams, or reclassifying assets or liabilities into various categories. Reclassifications are typically made to correct errors, adjust for changes in accounting policies, or improve the presentation of financial information.

Record-to-report (R2R)

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Record-to-report, or R2R, is the process of recording, summarizing, and reporting financial transactions and results within an organization. This process encompasses journal entry, general ledger maintenance, financial consolidation, and financial reporting. Record-to-report processes ensure financial data's accuracy, completeness, and integrity and support informed decision-making by management, investors, and other stakeholders.

Revenue recognition

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Revenue recognition is the accounting principle that governs when revenue is recognized and recorded in the financial statements. According to generally accepted accounting principles (GAAP), revenue should be recognized when it is earned and realizable and when the amount can be reasonably measured. This typically occurs when goods or services are delivered to customers, who are likely to pay for them. Revenue recognition is crucial for accurately reporting a company's financial performance and ensuring compliance with accounting standards. Discover 5 major revenue recognition risks and how finance automation can help.

RISE with SAP

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RISE with SAP helps on-premises SAP ERP customers move to the cloud by combining software, infrastructure and services to modernize ERP using SAP Business Suite.

SAP Cloud ERP (S/4HANA)

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SAP Cloud ERP is a cloud-based ERP system that uses AI, machine learning and analytics to automate business processes. It runs on the SAP HANA in-memory database for real-time data processing.

SOX

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SOX stands for the Sarbanes-Oxley Act, also known as the Public Company Accounting Reform and Investor Protection Act of 2002. This legislation was enacted in response to corporate accounting scandals to protect investors by improving the accuracy and reliability of corporate disclosures. SOX established new standards for corporate governance, internal controls, financial reporting, and auditor independence for publicly traded companies in the United States.

SOX compliance

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SOX compliance refers to a company’s adherence to the requirements and provisions outlined in the Sarbanes-Oxley Act. This includes implementing and maintaining effective internal controls over financial reporting, ensuring the accuracy and integrity of financial statements, and disclosing material information to investors and regulatory authorities. SOX compliance is mandatory for publicly traded companies in the United States and is overseen by the Securities and Exchange Commission (SEC) and other regulatory bodies.

Supply Chain Management (SCM)

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SAP Supply Chain Management (SCM) is a suite of solutions that leverages integrated data and embedded intelligence to align planning, execution and monitoring across sourcing, manufacturing, logistics and distribution.

Transaction reconciliation

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Transaction reconciliation is the process of comparing and matching financial transactions recorded in different accounts or systems to ensure accuracy and consistency. This may involve reconciling bank statements with cash accounts, matching invoices with payments, or verifying inventory records with physical counts. Transaction reconciliation helps identify errors, discrepancies, or fraudulent activities and ensures financial data's integrity and financial reporting's reliability.

Discover how to automate currency difference calculations and post-system reconciliations to enhance accuracy in financial close.

Transfer pricing

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Transfer pricing refers to the pricing of goods, services, or intangible assets transferred between related entities within the same multinational company. This includes transactions between a company's subsidiaries, divisions, or branches located in different countries or jurisdictions. Transfer pricing aims to establish fair and arm's length prices for intercompany transactions to ensure compliance with tax regulations and avoid tax evasion or profit shifting. Transfer pricing practices are subject to scrutiny by tax authorities to prevent abuse and ensure compliance with international tax laws.

Virtual close

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Virtual close refers to using technology and automation tools to accelerate and streamline the financial close process. This includes automating routine tasks, such as journal entries, account reconciliations, and financial reporting, to reduce manual effort and shorten the time required to complete the close process. Virtual close enables real-time visibility into financial performance, improves accuracy, and enhances decision-making by providing timely access to financial data and insights.

Working capital

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Working capital measures a company's liquidity and short-term financial health, calculated as the difference between its current assets and current liabilities. Current assets include cash, accounts receivable, and inventory, while current liabilities include accounts payable, short-term debt, and accrued expenses. Working capital represents the amount of funds available to cover day-to-day operational expenses and short-term obligations. Positive working capital indicates that a company has sufficient liquidity to meet its short-term obligations, while negative working capital may indicate financial distress or liquidity problems.

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