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Sujan Contitech AVS Pvt. Ltd. Successfully
Implements SAP Revenue Accounting and Reporting

About Client

Sujan Contitech AVS PVT LTD is engaged in the manufacturing of Anti-Vibration Systems for Automobile use. ​

Our Engagement

Inteliwaves has been engaged with Sujan Contitech AVS. Inteliwaves is the partner for implementing transforming and supporting Sujan Contitech AVS SAP S/4 India.

Key Challenges Faced by Client

  • As per Incoterms agreed with customers, a sales transaction is considered complete only when goods reach the customer premises. Before that happens, revenue cannot be recognized in the books.
  • According to India Goods & Service Tax (GST) regulations, sales occur upon dispatch of goods, so GST liability must be recognized at that time.
  • Revenue should only be recognized when the “Delivery Obligation” is fulfilled, meaning the customer provides a “Proof of Delivery” as required by IAS 115.
  • The current SAP solution recognizes revenue based on customer invoice generation, which does not comply with statutory audit requirements.
  • Therefore, it is essential to report invoice-wise POD confirmation along with revenue recognition.

Our Approach

  • SAP Revenue Accounting and Reporting (RAR) is designed to fulfil this requirement. SAP RAR is add-on solution to SCS’s existing SAP S/4HANA solution.
  • SAP RAR 1.3 was implemented as an add-on to existing SAP S/4HANA Solution of SCS &  integrated with SAP SD solution used for Sales Order, PGI and Invoicing process.
  • SAP RAR configured to process revenue for Performance Obligations (POBs) as required by SCS business, which is as follows:
    • Customer confirms receipt of goods in their premises by way of acknowledging the proof of delivery.
    • SAP RAR will release revenue based on POBs completion.
  • Business rules for revenue recognition is configured using SAP Business Rule Framework Plus.

Value Delivered by Inteliwaves

  • The SCS team has total control over revenue recognition based on POD confirmation received from a customer.
  • This enables visibility of deliveries acknowledged and not acknowledged by a customer; in case of delayed confirmation, follow-up with the transporter or customer can be initiated.
  • To achieve this, all the RAR steps (except POD Entry) were automated to ensure zero change management impact.
  • Compliance was thereby ensured for GST regulations as well as IAS 115.
  • Revenue recognition is now automated across multiple business scenarios.
  • The system is also integrated with SAP S/4HANA for seamless data flow.
  • As a result, accuracy improved in revenue reporting and financial statements.
  • The approach ultimately provides flexibility to handle complex contract arrangements.