Financial Closing

Best Practice Scenario: Financial Closing

The Financial Closing business scenario helps you to perform financial period-end closing activities to ensure correct financial statements, such as Balance Sheet, Income Statement, and Cash Flow Statement. Other closing activities are performed in the corresponding areas separately. The system generates a closing activity list according to the company‘s individual scope that can be adapted according to the requirements of month-end or year-end closing.

The accountant prepares closing by ensuring that all operational transactions are entered in the system, such as entering and paying invoices or performing physical inventory counts.

The Closing Cockpit supports the legal requirements and minimizes the risk of missing important steps or incorrect timing.

The accountant performs periodic valuation tasks, such as asset depreciation or foreign currency remeasurement and allocates costs and revenues to the correct periods. This ensures timely and compliant financial reporting and analysis.

Process Flow details Financial Closing

Roles of Financial Closing

• Accountant

Business Value of Financial Closing

For midsize companies who need to meet quickly and efficiently financial filing deadlines and achieve better transparency and compliance, this scenario aligns payables and receivables, tax and inventory accounting, management and general ledger accounting. You can improve financial and management reporting for regulatory compliance and increase investor confidence.

SAP Business ByDesign helps manage efficiently the end-of-period closing process: From completing operational transactions and their required postings, submitting reports to tax authorities through to the creation of financial statements. 

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[caption id="attachment_201670" align="aligncenter" width="1024"] The Business Flow of Financial Closing within SAP Business ByDesign[/caption]

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Key Benefits of Financial Closing

• Central and standardized closing procedure ensures the integration of each individual statement form;
• Reconciliation capabilities to proof the consistency across different business areas;
• Access to an up-to-date, comprehensive overview of the closing status, which promotes transparency;
• Parallel accounting functionality enables creation of financial statements that comply with appropriate accounting principles;
• Ability of employees to define closing tasks and their sequence well in advance, thereby supporting compliance and minimizing the risk of missing important steps or getting their timing wrong;
• Built in analytics enables a drill down to capture changes and adjustments affected by closing activities

Application

• SAP Business ByDesign

Continue to review the other Business Processes SAP Business ByDesign

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