Watch the video to understand what SAP Green Ledger is.
In addition to the value and quantity flow of Financial Accounting, Carbon Accounting generates a CO2 flow (Emissions and natural resource flow). For example, for logistical goods receipt and goods issue transactions.
The posting of the goods receipt, or goods issue generates:
- A Goods document for material management, for example, in pieces.
- A Journal entry for financial accounting, for example, in EUR and profit center, account Cost of Goods Sold (COGS) on the debit side, and account Finished Goods on the credit side.
These quantities and values are stored in ACDOCA.
- The additional recording of CO2 consumption in tons, and posting to accounts with financial dimensions in the SAP Green Ledger on the BTP (business technology platform), enables the carbon footprint to be evaluated.
As we saw in the video, the goods movement results in a financial accounting document that is recorded in the general ledger. The financial accounting document can optionally be consolidated at group level. The process ends in a balance sheet, profit and loss statement, and cash flow.
For example, for a goods issue of 10 pieces of a finished product, the account Cost of Good Sold (COGS) on the debit side, and the account Inventory of Finished Goods on the credit side, are both posted in with a value of 45,000 EURO.
Similarly, carbon accounting documents emissions, and the flow of natural resources through CO2 inputs and valuations, resulting in a carbon journal entry recorded in Green Journal.
The CO2 journal entry can optionally be consolidated at group level.
In the same scenario, for a goods issue of 10 pieces of a finished product, the account COGS on the debit side, and the account Inventory of Finished Goods on the credit side, are both recorded with a value of 10 tons of CO2.
Looking at the lower right table, we can analyze the Profit and Loss Statement entries for a hypothetical customer contract involving the sale of 10 products. With revenue at 100 EUR, and costs totaling 85 EUR (60 EUR direct and 25 EUR overhead costs) the transaction yields a 15 EUR margin. This represents the financial performance.
The next column reveals the environmental impact. Here, we see 10 tons of directly attributable carbon emissions, plus 1 ton of overhead emissions, resulting in a carbon intensity (or footprint) of 1 ton per unit. For this transaction, that totals 10 tons. This transparent accounting allows for insightful scenario analysis, modeling, what-if explorations.
Example
Track now, the CO2 flow of a polyethylene purchasing process.
Starting from the selection of the supplier with the best CO2 values, the purchase order, the goods receipt with Finance journal entry.
Take a look at how to post in the CO2 document in the Manage Carbon app.
Finally, you can see how the CO2 data is evaluated together with the Finance data in the Green Ledger Analytics Dashboard. This is possible because both the Financial ledger and the data of the Green Ledger are in SAP Datasphere.
Let’s take a closer look at the CO2 journal entry:
The general structure of the journal entry is divided into the General Information tab, and the Line Items tab. Under General Information, it shows transaction data and date/time details, including the journal entry number, company code, fiscal year, and entry creation details such as the creator's name. The Quantity by GHG Emission Scope segment details the CO2e emissions categorized by emission scopes.
The line items show the account, greenhouse Gas (GHG) category, debit or credit amount, and details such as cost center, profit center, and carbon data entered in the carbon collection document. If there are any reversals for the journal entry, that information is also displayed along with the related carbon collection document.