Sap For Finance In Media And Entertainment Accounting Essay
Media and amusement includes a assortment of merchandises that entertains or keeps informed a day-to-day consumer.
The industry is segmented into wireless, telecasting, wireless broadcast medium, etc. The competition in the media and amusement infinite is increasing twenty-four hours by twenty-four hours. To be on the top or even to last in this extremely competitory market one has to be really efficient in pull offing the information systems. In 2005 Reliance ventured into this infinite and rapidly adopted the criterions required to last in this market. The twelvemonth 2005 saw the entry of new participants across all sections of the E & A ; M industry. Reliance made its manner into amusement by purchasing out ‘Adlabs ‘ and besides acquired a wireless station known as BIG FM 92.7after command for 50 FM wireless Stationss across with aggregative commands of over INR 1.5 billion.
In this M & A ; E industry one can non bury the function of finance and accounting in the success way of these companies. Finance and accounting should be really efficient so that there are no statistical errors/delays.Most companies that fail in this industry have no or hold a weak information system for finance and accounting system. Finance holds the key for company ‘s success.
Reliance Media works adopted a really good MIS every bit shortly as it entered the infinite. It implemented a ‘SAP ‘ made MIS and rapidly got the positive consequences of utilizing it.
Finance and Accounting
Relationship to Accounting: There is really small difference between finance and accounting. Both autumn under the legal power of main fiscal officer who uses a peculiar MIS to function the intent of both.The difference lies in the sense that in finance the intent is to maximise the net income whereas the intent of accounting is score maintaining so that a base for revenue enhancement payment is prepared.
A fiscal director analyses the natural information ( provided by the comptroller about the company ‘s yesteryear, present and future ) as inputs to MIS for doing of import determinations.Accounting is non concerned with hard currency flows. It is merely based on the recognized grosss when sale occurs. Finance is merely concerned to hard currency flows. The magnitude, timing and hazard of hard currency flows are the focal point of finance director.
Finance involves determination doing under unsure conditions and is concerned with future whereas accounting is concerned with the past records.
WHY MIS IS USED?
A
Large organisations have a batch of information. This aggregation of informations can non be of any usage if it is non streamlined so that informations can be retrieved easy.MIS would assist in commanding, tracking and monitoring of informations.Segregation of informations into faculties would ensue in faster determination devising.
Would assist in traveling paper free.Use of MIS would guarantee the consequence as per the outlook and analysis of informations would be done easy.
SAP FOR FINANCE IN MEDIA AND ENTERTAINMENT
hypertext transfer protocol: //www.sap.com/global/images/tce/spacer.gifReliance Mediaworks uses SAP for functioning its fiscal jobs.
SAP for Media provides trim solutions to maintain up with rapid alterations driven by the Internet, on-line publication, and digital broadcast medium.
SAP FOR Reliance mediaworks
The maps of SAP for Reliance Mediaworks are as follows- :License acquisition and surpassing royalties – Reports on accurate royalty statements are prepared utilizing SAP.Core accounting and coverage capablenesssFiscal supply concatenation directionTreasury ManagementShared servicesSupply Chain ManagementSAP for Media solutions enable a scope of cardinal procedures for license acquisition and surpassing royalties, including:License acquisition contract treating – Sap for Media solutions support the rendition and recording of understandings and contracts with assorted licensors sing the type and figure of rights or services, and the engagement ( royalties ) .
Rights clearance – Sap for Media solutions give you a complete overview of all IP rights and the associated contract, release, and rights handiness information.Surpassing royalties colony – With SAP for Media solutions, you can settle surpassing royalties on the footing of grosss achieved and harmonizing to the understandings in the license acquisition contracts, taking into history any progresss and minimal warrants paid.License acquisition contract analysis – With SAP for Media solutions, you can analyse the concern minutess for license acquisition to find the success achieved in assorted markets.SAP Intellectual Property Management helps in applications for royalties.
License gross revenues and incoming royalties – Support coaction between licensees and your company – from contract dialogues to the aggregation of incoming royalty payments – to cut down the manual handling of contracts and guarantee accurate royalty statements.
The Business Process of License Gross saless and Incoming Royalties
SAP for Media solutions support a assortment of cardinal procedures for licence gross revenues and incoming royalties, including:Rights handiness analysis – With SAP for Media solutions, you can expose an overview of IP rights, utilizing hunt standards such as rights freely available to be sold or gross revenues contracts in which specific rights have already been assigned. The rights handiness analysis can function as a type of rights stock list direction.
License gross revenues contract treating – Sap for Media solutions enable you to sell rights to a licensee, commanding the transportation of rights against fixed or variable fees in license gross revenues contracts, while the pecuniary deductions of the sale ( such as the profitableness analysis ) are transferred to SAP accounting package.Rights use verification – Sap for Media supports the gross revenues of rights against variable licence fees, based on the licensee ‘s success from working the right. With SAP package, the informations on grosss and rights development costs reported by a licensee are entered in the licence use verification and automatically assigned to the gross revenues contract for specific periods, so accounted for during charge for incoming royalties in conformity with the agreements in the contract.Incoming royalties charging – With SAP for Media solutions, you can measure licence grosss on agenda, on the footing of the licensee ‘s use informations – and reimburse any bing progresss and minimal warrants automatically – when you make understandings on the transportation of rights against fixed or variable licence fees.Contract alteration – With SAP for Media solutions, you can do subsequent alterations to licence gross revenues contract points that have already been released, retroactively or non-retroactively, during the full life rhythm of a licence gross revenues contract.License gross revenues contract analysis ( by rubric ) – You can utilize SAP solutions to analyse concern minutess for licencing with respect to the success achieved in assorted markets.
License gross revenues and incoming royalties is enabled with SAP applications such as SAP Intellectual Property Management.By title fiscal accounting – Support the rating and coverage of stock list harmonizing to different ordinances in up to three currencies or ratings.
Fiscal Accounting
Manage by title fiscal accounting: -General ledger – It is a aggregation of histories used to enter and sort all fiscal minutess as plus, liability, gross, or disbursal. External accounting and histories are managed by SAP solutions.Classified by type into one of the undermentioned classs:Assetss illustrations of plus histories include hard currency, histories receivable, stock list, land, edifices, equipment and investings.Liabilitiess illustrations of liability histories include histories collectible and long term debt.Retained Net incomes the cumulative “ life-to-date ” sum of all one-year excesss and shortages over the old ages.Gross illustrations of gross historiesExpense illustrations of expense histories include wages and rewards, depreciation, involvement disbursal etc.
Receivable accounts- : Pull offing a list of receivable histories can be really boring if done manually. This job is solved utilizing SAP which records and manages such histories.Collectible accounts- : Merely as we have receivable histories to enter the income so besides a record should be maintained for the outgoing payments that are to be made.Taxation- : Calculation of revenue enhancements ( gross revenues and purchases ) and coverage of the same is easy done utilizing SAP.
Income-tax disbursal comprises current revenue enhancement disbursal computed in conformity with the relevant commissariats of the Income revenue enhancement Act, 1961 and deferred revenue enhancement charge or recognition.Current revenue enhancement proviso is made based on the revenue enhancement liability computed after sing revenue enhancement allowances and freedoms, in conformity with the Income revenue enhancement Act, 1961. Deferred revenue enhancement charge or recognition and the corresponding deferred revenue enhancement liability or plus is recognised for clocking differences between the net incomes / losingss offered for income revenue enhancements and net incomes / losingss as per the fiscal statements. Deferred revenue enhancement assets and liabilities are measured utilizing the revenue enhancement rates and revenue enhancement Torahs that have been enacted or substantively enacted at the balance sheet day of the month.Provision for periphery benefit revenue enhancement was made on the footing of applicable rates on the nonexempt value of eligible disbursals of the Company as prescribed under the Income Tax Act, 1961 boulder clay 31 March 2009 on the footing of pertinence. Entertainment revenue enhancement is besides levied as a signifier of revenue enhancement.Accrual accounting- : Accrual means entering gross or cost every bit shortly as they are earned and non wait for the clip when they would be settled.
SAP helps in pull offing collectible and receivable histories harmonizing to accrual accounting.The assorted cost/expense of the company include- :Cost can specify as escapes from the company.
Personal costs
Wages, rewards, fillips, PPF, staff public assistance disbursals
Operational costs
Advertisement, bank charges, rent, insurance, labor charges, loss on sale, bad debts, printing and communicating, other assorted disbursals.Other costs include involvement payment on the loans, fiscal charges etc.Income/Revenue includes- :Gross is recognised to the extent that it is likely that the economic benefits will flux to the Company and the gross can be faithfully measured.
Advertisement / sponsorship gross
Gross from advertizements, sponsorship and events is recognised on the day of the month of the exhibition of the advertizement / event, over the period of the contract or on completion of the Company ‘s duties, as applicable.
Film production and related income
Gross from sale of content / gesture images is accounted for on the day of the month of understanding to delegate / sell the rights in the concerned gesture image / content or on the day of the month of release of the content / film, whichever is subsequently.
Income from movie distribution activity
In instance of distribution rights of gesture images / content, gross is recognised on the day of the month of release / exhibition.Gross from other rights such as orbiter rights, abroad rights, music rights, picture rights, etc.
is recognised on the day of the month when the rights are made available to the assignee for development.Gross from sale of VCDs / DVDs, etc is recognised when the hazards and wagess of ownership are passed on to the client, which by and large coincides with the despatch of the merchandises.
Film production services
Gross from treating / printing of cinematographic movies is recognised upon completion of the related processing / printing.Gross from processing of digital content is recognised utilizing the proportionate completion method. Use of the proportionate completion method requires the Company to gauge the attempts expended to day of the month as a proportion of the entire attempts to be expended.
Attempts expended have been used to mensurate advancement towards completion, as there is a direct relationship between attempts expended and contracted end product.Sale of traded goods is recognised when the hazards and wagess of ownership are passed on to the client, which by and large coincides with the despatch of goods.Income from equipment / installation lease is recognised over the period of the relevant understanding / agreement.
Theatrical exhibition and related income
Sale of ticketsGross from theatrical exhibition is recognised on the day of the month of the exhibition of the movies and comprises returns from sale of tickets, gross of amusement revenue enhancement.
As the Company is the primary obligor with regard to exhibition activities, the portion of distributers in these returns is individually disclosed as distributers ‘ portion.Sum of amusement revenue enhancement is shown as a decrease from grossSale of nutrient and drinksGross from sale of nutrient and drinks is recognised upon sale and bringing at the counter.
Interest income / income from movie funding
Interest income, including from movie / content related production funding, is recognised on a clip proportion footing at the rate implicit in the dealing.
Dividend income
Dividend income is recognised when the right to have dividend is unconditioned at the balance sheet day of the month.
Marketing rights / Rights to gain
Sums received in stead of future selling rights sale, right to future net income from concern of the Company and other rights are recognised as income in the twelvemonth of come ining into the contract.
Foreign currency minutess
Reliance has operations all over the universe. This income is in footings of foreign currency. Minutess denominated in foreign currency are recorded at the exchange rate predominating on the day of the month of the minutess. Exchange differences originating on foreign exchange minutess settled during the twelvemonth are recognised in the net income and loss history of the twelvemonth.Treasury directionReliance has a separate faculty for the intent of exchequer direction.
This faculty invariably manages the assets and the investings that have been made by the company.
Investings
Reliance Mediaworks is invested in many bonds and common financess. The list of these investings every bit good as such other investings is maintained by SAP. New investings to be made are besides analysed by the MIS. A proviso for decline is made to recognize a diminution, other than impermanent, in the value of long-run investings and is determined individually for each single investing.
Current investings are carried at lower of cost and just value.
Fixed assets and depreciation / amortization
a. Tangible assets
Tangible fixed assets are stated at cost and / or revalued sum in conformity with strategy of merger less accrued depreciation and any proviso for damage. Cost includes cargo, responsibilities, revenue enhancements ( other than those recoverable from revenue enhancement governments ) and other disbursals related straight / indirectly to the acquisition / building and installing of the fixed assets for conveying the plus to its working status for its intended usage.Depreciation on fixed assets is provided on the consecutive line method, at the rates prescribed in Schedule XIV to the Act, which, in direction ‘s sentiment, reflects the estimated utile lives of those fixed assets, except in instance of following assets of theatrical exhibition section wherein depreciation is provided at following rates:
Particulars of fixed assets
Rate of depreciation
Plant and machinery10 %Furniture and fixture10 %Computers20 %Motor auto10 %Application package purchased, which is non an built-in portion of the related hardware, is shown as intangible assets and amortised on a consecutive line footing over its utile life, non transcending five / ten old ages, as determined by direction.
Film rights comprise negative rights and distribution rights in movies and are for a contractually specified manner of development, period and district and are stated at cost less accrued amortization. Cost of movie rights comprises original purchase monetary value / minimal warrant. Cost is ascertained on specific designation footing where possible. In instance multiple movies / rights are acquired for a amalgamate sum, cost is allocated to each movie / right based on direction ‘s best estimations.The single movie prognosis method is used to amortize the cost of movie rights acquired. Under this method, costs are amortised in the proportion that gross grosss realised bear to direction ‘s estimation of the entire gross grosss expected to be received.
If estimations of the entire grosss and other events or alterations in fortunes indicate that the realisable value of a right is less than its unamortised cost, a loss is recognised for the surplus of unamortised cost over the movie right ‘s realisable value.In regard of unreleased movies, payments towards movie rights are classified under capital progresss as the sums are refundable in the event of nonrelease of the movie.Purchased good will is recognised by the Company on the footing of surplus of purchase consideration paid over the value of the assets acquired at the clip of acquisition and is amortised over its estimated utile life non transcending ten old ages.Version: SAP Crystal ReportsEditions: SAP Crystal Reports comes in a individual edition that is the feature equivalent of the old Developer Edition.
SAP Crystal Reports Dashboard Design bundle is a soft package of SAP Crystal Reports and SAP Crystal Dashboard Desing ( once known as Xcelsius Engage ) .Datas beginnings: Native, ODBC, OLE DB, and JDBC connectivity to relational, OLAP, web services, XML, and enterprise informations beginnings, and new salesforce.com driver.License theoretical account: Licensed per named userLanguages: English, Gallic, German, Italian, Spanish, Portuguese ( Brazilian ) , Dutch, Swedish, Russian, Simplified Chinese, Traditional Chinese, Japanese, Korean, Polish, Norwegian, Thai, Czech, and Finnish
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Disk infinite: 300 MB available difficult thrust infinite, 600 MB recommended with SAP Crystal Reports, version for Ocular Studio.NETOperating systems: Microsoft Windows 7, Windows Vista, Windows XP with Service Pack ( SP ) 2, Windows Server 2003 with SP1, or subsequentlyIntegrated development environments: SAP Crystal Reports, version for Ocular Studio 2008, 2005, and 2003Brassy Support: Embedded Flash objects can be viewed with the.NET Winform spectator, .Net Webform spectator, Java DHTML spectator, SAP Crystal Reports spectator, and exported PDF files.
