SAP ERP is an integrated enterprise resource planning (ERP) software manufactured by SAP AG that targets business software requirements of midsize and large organizations in all industries and sectors. More than 2,300 customers are using the latest version of mySAP ERP. It is a real-time process system which all the users log on the central platform server. There are many sub-functions of SAP including SAP ERP Financials, SAP ERP Human Capital, Management SAP ERP Operations, and SAP ERP Corporate Services. We only focus on the revenue cycle and expenditure cycle of the SAP system which is direct related to the accounting information system.
About master records:
The expenditure cycle is composed of purchase system and accounts payable system. The creation of material master records and vendor master records makes the purchase system more efficient. While traditional information system has three databases include customer sales A/R (customer database), production scheduling shipping (Manufacturing database) and vendor A/P inventory (Procurement database). SAP systems a common operational database (customer, production, vendor, and inventory). The problem with traditional system is the lack of effective communication between systems is often the result of a fragmented systems design process. On the other hand, SAP systems use a common operational database that supports communications and present the data in a way that meets all user needs. The material master is the main source of material specific data. It is used by all components in the logistics system. By using the master record, we can avoid data redundancy, and use the data in many other functions other than purchasing data for ordering. Those include posting goods movements, managing physical inventory, inventory valuation, and material requirements planning. Also material master is divided into three levels: client level, plant level and...