R2R 101 · PROCESS OVERVIEW
What is Record to Report?
Record to Report is the Finance process that turns business events into governed journal entries, measures the period correctly, closes the books, and produces financial statements that can be traced back to evidence.
Record to Report flow
Continuous recording converges into a controlled close
ONE PROCESS, THREE PROMISES
Why R2R matters
Complete record
Accounting-relevant events from sales, purchasing, inventory, assets, payroll, banking, controlling, and manual journals reach the right books.
Correct period
Cut-off, reconciliation, accruals, valuation, depreciation, allocation, and review place value in the appropriate period and accounting view.
Trusted report
Approved balances become entity and group reporting with controlled hierarchies, currencies, adjustments, drill-down, and retained sign-off.
FOLLOW THE ACCOUNTING CYCLE
What changes at each stage?
The stages are connected, but they do not all wait for month-end. Recording, clearing, and reconciliation should happen throughout the period.
- 01
Record Continuous
Source processes and accountants create balanced, referenced journal entries in the intended company, ledger, currencies, accounts, and dimensions.
Creates Governed accounting evidence
- 02
Reconcile Daily + close
Finance proves customer, supplier, asset, inventory, bank, GR/IR, tax, intercompany, and other balances against complete supporting populations.
Reveals Agreement and owned exceptions
- 03
Adjust and value Period-end
Accruals, provisions, depreciation, foreign-currency valuation, allocations, reclassifications, and other policy entries refine timing and measurement.
Produces Policy-compliant period balances
- 04
Close and control Dependency gate
Close owners coordinate operational cut-off, subledger completion, jobs, reconciliations, reviews, late journals, exceptions, and posting-period access.
Protects An approved reporting population
- 05
Report and explain Entity + group
Financial statement hierarchies organize approved balances; group processes map, translate, reconcile, adjust, and eliminate where applicable.
Delivers Traceable financial statements
HOW SAP FRAMES THE ACCOUNTING EVENT
Three structures make the close reportable
The process explains what Finance does. These structures explain where the value is recorded and how the same journal can support different views.
Company, ledger, and currency
Legal entity, fiscal calendar, accounting principle, and currency settings establish the books.
Explore Finance structure → ACCOUNTING RECORDUniversal Journal
Journal line items carry financial and management-accounting dimensions in one integrated record.
Explore journal controls → PRESENTATIONHierarchy and group hand-off
Financial statement hierarchies, mappings, currencies, and eliminations turn balances into reporting views.
Explore reporting →ONE MONTH-END STORY
From July activity to approved statements
Operational postings build the July ledger. Finance clears and reconciles open items, accrues an uninvoiced service, runs depreciation and foreign-currency valuation, reviews the trial balance, publishes entity statements, submits the group package, and restricts late posting.
See how the close is governedTHREE RHYTHMS
R2R is not only a month-end process
Process source postings and interfaces, clear open items, reconcile bank activity, resolve errors, and keep ownership current.
Enforce cut-off, finish subledgers, reconcile, value, adjust, review, report, submit, and protect the period.
Add balance confirmations, audit and disclosures, reclassifications, carry-forward, statutory work, and fiscal-year closure.
A distributor records customer billing, supplier invoices, inventory movements, assets, payroll, and bank activity throughout July. At close, Finance proves the populations, records supported adjustments, reviews the statements, submits group data, and closes normal posting access.
Explore Finance structure, journal controls, integration, reconciliation, valuation, banking, close governance, and reporting.