SAP & EURO

Index

SAP - Euro Mission

SAP-Euro Major Events

Business Implications: by functional area

Euro Impacts on SAP environment

Release Version Management

Local Euro related Legal Requirements

AC method on Euro project approach

Euro Major References

Euro comprehension and awareness Euro DB

Euro Issues: Key Messages

 SAP Euro - Mission

 “ Select and disseminate information regarding the

topic Euro to all our SAP engagements in Italy ”

 “ Facilitate the finding of valuable and official SAP

Euro information for all interested parts ”

SAP Euro Major Events

2nd of May 1998: Italy admitted to EMU Contries

July 1998: Official Issue SAP R/3 Euro compliant version

- 3.1.I

- 4.0.b

NO Italian Detailed Official Regulatory

as Today (July 1998)

Business Implications: Accounting

Convert all amounts into Euro

 Re-evaluate:

long-term delivery and service contracts

forward exchange transactions

interest rate transactions

long-term loans and interest agreements

 Reset key figures

Business Implications: Treasury / Finance

 Convert all payment transactions into Euro in

agreement with central banks, financial institutions
and business partners

 Restructure investment management under aspects of

new risk considerations

 Restructure foreign exchange management

Business Implications: Controlling

 Re-determine medium to long-term planning

 Define the Euro as reporting currency

 Determine new relationships between non-EU

currencies and the Euro
Business Implications: Procurement

Re-assess purchasing terms

 Carry out new pricing comparison

 Adapt long-term contracts

 Reconfigure purchasing volumes

 Reassess supply sources and transport routes

Business Implications: Inventory Management

 LIFO and FIFO evaluations

 Stock valuation procedures in terms of valuation method(standard or MAP)

 Inventory adjustments
Business Implications: Sales

 Restructure overall pricing and sales policy

 Re-assess ticketing practice; Double ticketing of items during
transitional period
 Re-determine quotation prices and discounts

 Regenerate price lists

 Restructure billing procedures

 Revise dunning procedures

 Redraft payment periods and payment terms

Business Implications: Human Resources

 Convert standard pay scales to euro

 Convert non pay scales compensation and payments in excess of
the general pay scale to euro
 Convert existing company pension reserves
 Convert internal relief fond contributions and financial aid
 Analyze and determine the relevant amounts of local taxes
 Consult employee representatives in advance of conversion

process
EURO impact on SAP environment
1 St. Phase - Dual Currency Management
From 1.1.1999
FI
SD Financial
Sales Acctg.

MM CO
Materials Controlling
Mgmt
PP AM

R/3
Production Asset
Planning Mgmt

QM
Quality Client / Server PS
Project
System
Mgmt
PM WF
Plant Workflow
Maint.
HR IS
Human Industry
Resources Solution

2 nd Phase - Conversion on Key Date

from 1.1.1999 - before 1.1.2002
“ EURO has a Wide and Deep
Impact on all SAP Modules and
Functionalities “
EURO impact on SAP environment

SAP - Euro: Critical Issues

 Direct exchange rates between EMU currencies will not exist
anymore: in order to execute the conversion from one currency to
another one, the amount must first be converted into Euro and
then from Euro to the other currency.

 The amount obtained after the conversion in Euro must be

rounded at the third decimal place.

 Conversion rates can not be rounded or cut off.

 It is not allowed to use inverted exchange rates.

 Conversion rates will be composed of 6 significant figures

Release Version Management

Euro Compliance with the EU Council Regulation 1103/97

Release Version Standard Hotpackage Issue Date

Nr HP
4.5A X Feb '99
4.0B X Jun '98
4.0A X Dec '97
3.1I X Jun '98
3.1H X 07-09 Jan '98
3.1G
3.0F X 23-25 Jan '98
3.0E
3.0D X 36 Jan '98

X = SAP Supported Version

Release Version Management

Functions Delivered with Hot Package 3.0D-3.1H:

 Conversion rate and rounding logic according to legal requirements

Business transactions in euros using the multi currency capability

 Changing currency in individual customer and vendor master records

 Changing document currency for individuals quotations and sales orders

 Entering invoices in a different currency

 Creating pricing conditions in euros

 Translating balance sheet into euros

Release Version Management

Local Currency Conversion on Key Date

Release Version Standard

4.5A X
4.0B X
4.0A
3.1I X
3.1H
3.1G
3.0F *)
3.0E
3.0D

X = Supported
*) On project basis with SAP only
Release Version Management
Functions Delivered with Conversion On Key Date Toolkit

In addition to the euro functions in release 3.0D - 3.1H following will be

delivered:
 Conversion of local currency into euro at system client level
 Mass change for customer and vendor master records
 Mass change for converting open quotations and orders
 Check on euro conversion rate when rate is entered manually in document
 Separate conversion of payroll accounting
 Full retroactive Accounting capabilities in HR also

after conversion
 Renumeration statement in two currencies
 Mass change in HR for pay scales and contracts
 IS-Utilities
X

IS-Telecommun.
X
Industry Solution by Release Version

IS-Retail
X
X

IS-Real Estate
X
X
X
X
X
X
X
IS-Public Sector
X
X

IS-Oil
X
X
X
X
X
IS-Insurance
X
Release Version Management

IS-Hightech.
X
IS-Healtcare
X
X
X
X
X
X
X
X
X
IS-Consumer
X
IS-ChemicalsI

X
X
X
X
X
X
X
X
X
IS-Banking

X
IS-Automotive

X
IS-Aerospace

3.1G
3.1H

3.0D
4.5A
4.0B
4.0A

3.0E
3.0F
3.1I
Release
Release Version Management

Tools to manage custom add-ons

 No standard SAP Official Tools

 Organize internal check in each project

 First step suggest for phase:

Dual currency phase

 “ verify Add-Ons containing currency ex-rates tables (TCUR*)”

Conversion On Key Date

 “ verify Add-Ons containing / not containing

Company Info (table 001 references)”.

These are the only SAP info by today date.

 Release Version Management

SAP R/3 Release Overview of the Euro Solution

Component 4.5A 4.0B 4.0A 3.1I 3.1H 3.1G 3.0F 3.0E 3.0D 2.X
h asEuro
e Conversion and
cy P Rounding roules X X X X X X X
n
u rre Additional Functions:
a lC
Du Business Transactions
Enhancement X X X X X X X
Date Date Conversion
Key
y
n Ke Package X X X (*)
io nO
e rs
nv
Co X= SAP Supported
(*) On project basis with SAP only
 Release Version Management

SAP R/2 Release Overview of the Euro Solution

Component 6.1H 6.0H 5.0H 6.1G 6.0G 5.0G 6.0F 5.0F 5.0E 5.0D
EuroseConversion and
Pha
Rounding roules X X X X X X X X X X
c y
rren Additional Functions:
l Cu Business Transactions
u a
D Enhancement X X X X X X X X X X
ate Conversion
Key Date
D
K ey
Package X X X X X X
n On
r sio
e
o nv
C
Release Version Management

Version migration approach

FI
SD
Financial
Sales

SAP R/3
MM Acctg.CO
Materials Controlling
PPMgmt R/3 AM
Production Asset
Planning Mgmt

4.0.B QM
Quality
MgmtPM
Client / Server

WF
PS
Project
System

Euro Compliant
Plant Workflow
Maint.HR IS
Human Industry
Resources Solution

SAP R/3
4.5.X
Sap R/3 Euro Compliant
3.1.I
Euro Compliant
Release Version Management

SAP Euro targeted versions: main differences

Delta Euro Functionalities 3.1I - 4.0B:

• CO planning processor with euro column

• Conversion in the value display transaction in asset accounting
• Mass change for conditions

Delta Euro Functionalities 4.0B - 4.5A

• None
Release Version Management

SAP R/3 Development Program

Release
Release Issue
Issue Date
Date

3.1
3.1 HH November
November 1997
1997
3.1
3.1 II June
June 1998
1998
4.0
4.0 AA January
January 1998
1998
4.0
4.0 BB June
June 1998
1998

4.5
4.5 44 Qtr.
Qtr. 1998
1998
…..
…..
 Local Euro Related Requirements

Legal references / Booklet

• CEE Regulation introducing Euro (October 1996)

• Comments on Euro Regulation - Technical Committee “Legal aspects on Banking
regulation” (December 1996) - ABI
• Schema “disegno di legge concernente delega al Governo per l’introduzione
dell’Euro” (May 1997)
• “Direttiva del Presidente del Consiglio dei Ministri”
• “Legge Delega al Governo” for Euro adoption (December 1997)
• Working paper on Euro introduction “Commissione congiunta per i principi
contabili di dottori commercialisti e ragionieri” (February 1998)
• “Decreto Legislativo” for Euro introduction (G.U. n. 157, 8 July 1998)
Local Euro Related Requirements

Status of Italian development

Functionalities / Report Euro Compliant

Ricevute Bancarie (RIBA) No

Terzi Percipienti tbi
IVA Documentation tbi
DDT (Documento di Trasporto) tbi
Intrastat tbi
….

Tbi = To be investigated
AC Method & Euro project approach

Managing

Planning
Planning Delivering
Delivering

Operating

AC Change Management Model

Navigation Leadership

Enablement Ownership

Change Model
AC Method & Euro project approach
TASK DELIVERABLE COMPONENTI

Business Context
Define Business Case Business Case Value Impact Analysis

Business Architecture Scope

Business Architecture Scope Definition
Definition
Define Business
Architecture Business Capability Definition
Business Capability Definition Business Capability Performance Model
Business Capability Blueprint

Assess Current Current Business Capability

Current Business Capability Assessment
Capabilities Assessment

Program Description
Identify & Resolve Gaps Gap Closure Solution Component Definition
Solution Component Dependency Diagram

Program Release Approach

Value Realization Approach
Plan Value Realization Value Realization Plan Program Assumption and Costs
Program Responsibility Assignment Matrix
Euro Major References

A.C. Knowledge Xchange: list of referenced D.B. and WEB

 EU Monetary Union Library

EU Monetary Union Discussion

 http://WWW.AC.COM/Euro
Euro Major References

SAP Internet WEB Domains

 SAP AG Home Page (http://www.sap-ag.de/euro)

 SAPNet (http://www.001sap-ag.de/euro)
Euro Major References

Euro News Internet WEB Domains

 Ufficial European Central Bank - http://europa.eu.int/emi/emi

 “Ministero del Tesoro” European Commitee

http://www.tesoro.it/euro-sm.html

 Statistiche europee- http://europa.eu.int/eurostat.html

 European News - http://europa.eu.int/euro

 Italian News - www.ilsole24ore.it/euro/

Euro Comprehension and Awareness Euro DB

• International companies Euro-status survey

• Top Management Euro Observatory

 Euro - Key Messages

 As of 1/1/1999 you need to be at least on release 3.0D,

implementing HotPackages, for correct currency conversion

 Conversion to Euro
 must be done after a fiscal year change (last chance FY 2001,
before 07/2002)
 at least release 3.1I

 Custom build add-ons will require attention at

all clients
End