Ingeniero

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2010 Global Integrated Audit Instructions

including

procedures in support of the
2010 group audit of internal control
over financial reporting


December 31, 2010








TABLE OF CONTENTS


1 Purpose and Background 1

1.1 Success factors 2

2 Significant changes from prior year instructions and other important matters 3

3Engagement Management 7

3.1 KPMG Mannheim Engagement Team 7
3.1.1 Address for correspondence: KPMG MANNHEIM OFFICE 7

3.2 Independence / Sentinel 8
3.2.1 Independence 8
3.2.2 Sentinel 8

3.3 Professional Qualifications of the Engagement Team 8

3.4 Site Visits and Desk Reviews 10

3.5 Consultation regarding IFRS, PCAOB or SEC Rules 10

3.6 Reporting to KPMGMannheim 10

4 Knowledge Sharing 13

4.1 Sources for Information on SAP 13

4.2 Financial Accounting and Reporting of SAP 13

4.3 KPMG Audit Manual-International & eAudIT KAM-International 14

5 Audit Approach 14

5.1 General Considerations 14
5.1.1 Audit Scoping – Considerations, Definitions, and Locations 14
5.1.2 Scope definitions/locations 15
5.1.3 Audit Workflowand Global Working Papers 16
5.1.4 Materiality (FSA and ICOFR) 16

5.2 FSA Audit and Reporting 17
5.2.1 Shared Audit Center - Audit work performed centrally by KPMG Mannheim 18
5.2.2 Sample Selection 24
5.2.3 Evaluating Samples 25
5.2.4 Internal Control and Risk Management assessment 25
5.2.5 Audit Risk Analysis and Significant Accounts 26
5.2.6 Other AuditConsiderations 31

5.3 ICOFR Audit and Reporting 38
5.3.1 Overview 38
5.3.2 SAP’s ICOFR Approach for 2010 39
5.3.3 KPMG Mannheim’s ICOFR audit strategy decisions 42
5.3.4 Audit Approach Related to KPMG’s Opinion on the Effectiveness of ICOFR 45
5.3.5 KPMG Mannheim’s Evaluation and Aggregation of Deficiencies 47
5.3.6 Timing, Reporting Tools and Reporting Deadlines48
5.3.7 Engagement Management and Administration 49

6 Reporting Forms and Due Dates 49

6.1 General 49

7 KPMG Ethics and Compliance Hotline and Website 50

8 List of Appendixes 50
Purpose and Background


The purpose of the SAP Global Integrated Audit Instructions is to provide information concerning KPMG’s approach to, and conduct of, our audit of the consolidatedfinancial statements of SAP Aktiengesellschaft and Subsidiaries (SAP, the Company or the Group) for the year ending December 31, 2010, as well as our audit of internal control over financial reporting (ICOFR) as of December 31, 2010. These instructions include background information on SAP, our assessment of how recent developments impact our global audit approach, communication of the audit strategy toparticipating locations, and the definition of responsibilities and reporting requirements for local auditors.


These instructions address important changes from the prior year; please refer to Section 2 below for further discussion of such changes.


Similar to last year, these instructions address both the Financial Statement Audit and the audit of ICOFR. We will ask you to acknowledgethe receipt of these instructions and your agreement with the requirements outlined herein by completing and releasing the respective reporting document in eASy (refer to Section 5.3.6 for details on the reporting process).


These Global Integrated Audit Instructions articulate the respective responsibilities of each participating KPMG audit engagement team in executing the Integrated Audit ofthe Group in compliance with the KPMG Audit Manual – International (KAM-I) (updated in April 2009) and the standards of the PCAOB. Engagement teams are responsible for monitoring any further updates to KAM-I during the year in order to reflect any required updates in the performance of audit procedures. Due to 2010 being a transition year to eAudIT, KPMG’s tool for executing a paperless audit,...