SAP Financial Closing Cockpit

Accounting and Financial Close

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SAP’s accounting and financial close solutions streamlines the accounting for multiple companies, currencies, charts of accounts, and reporting standards. The solutions enable finance to efficiently close books on time, and create financial statements at the entity and corporate levels for IFRS, U.S. GAAP, or other local and global requirements.

  • SAP offers a modern accounting system for finance teams needing to streamline core financial and closing processes to meet increasingly complex business and disclosure demands.
  • It accelerates your company’s path to financial transformation by eliminating boundaries between transactional and analytical processes combined with proven excellence in accounting and closing capabilities.
  • SAP Financial Closing cockpit = Transactions codes “FCLOCOx

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Top 10 Benefits of SAP Accounting and Financial Close Solutions

1. Lower Cost of Finance

Accelerated processes increase productivity and reduce cost. Automate manual steps  to reduce staff workloads which lowers the cost of their work and increases productivity.

2. Accelerated Closing

Reduce cycle time via automation, integration and collaboration. Virtual soft close provides better insight at anytime from anywhere. Accelerate accounting by integrating GL, fixed assets, accounts payables, accounts receivables, inventory, revenue, and costs in real-time.

3. Real-Time Business Insight

Enables fast issue resolution and gets you closer to the business. Monitor in real-time the progress, quality, and financial results of the closing cycle to avoid bottlenecks and address business concerns

4. Responsiveness

Closes the gap between insight and action. Achieve fast, multi-dimensional reporting without replicating information to a data warehouse Instant access anywhere with drill-down from the highest to the lowest level of detail.

5. Harmonization
Harmonize internal and external reporting without redundancy. Unify financial, regulatory, managerial and operational data in a single repository across multiple systems. Eliminate redundant data aggregation for easy analysis down to the lowest   level of detail. Reduction of memory footprint through elimination of redundancy. Unite OLTP and OLAP together for simplified landscape, processes, and analysis.

6. Seamless Access

Self-service access to transactions and analytics anywhere, at any time. Past, present and future analysis at your fingertips to answer tough questions in briefings and meeting.

7. Modern User Experience

State-of-the-art user experience using the latest technology innovations. Intuitive end user training interfaces and guided processes eliminate complex teaching undertakings. Customize templates for event-driven closing tasks and collaboration.

8. Compliance You Can Count On

Efficiently meet the demands of complex compliance regulations. Generate high-quality financial statements and management reports required by international and local reporting standards.

9. Boundless Extensibility

Unlimited potential to extend system to customer’s specific business needs.

10. Foundation for Finance Transformation and Innovation

A seamless path to your finance transformation. Choose your path towards finance transformation with real-time software available in on-premise, cloud or hybrid options.

Reconciliation Functionality in SAP ERP

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Execute Entity Close Tasks

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Financial Closing Cockpit on Fiori

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  Cockpit to monitor the progress of the entity close via KPIs, also on a mobile device

  Analyze the completion rate of closing tasks by multiple dimensions like region, country, company, milestone, working day, etc

  Monitor the tasks delayed or in error with easy collaboration to respective task owners

  Analysis of historic closing cycles

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Source : SAP ™

Thank You

Jayanth Maydipalle

Key Features on S/4 HANA FINANCE

1.     Currency types in S/4 FINANCE

For release S4 FINANCE more flexibility was introduced regarding currency configuration. The Universal Journal in SAP S/4HANA can handle up to 10 currency fields.

It is possible to have 2 fix (Local and Global currencies) plus 8 freely defined currencies for GL (3 for AA, 3 for ML, and 2 for CO). The 8 freely currencies can be defined on ledger level.

However, the currencies for parallel ledgers do not depend on leading ledger.

2.     Extension ledger

  • Appendix/Extension ledger is defined on top of a base ledger, which is a standard ledger.
  • Inherits in reporting all transaction data of underlying base ledger.
  • Carries physically only line items posted to Appendix ledger only.
  • Can be defined separate Open period variant

How to Set Up the Simulation Extension Ledger

The customizing task to set up the simulation extension ledger is similar to the regular extension ledger. Apart from defining the ledger, there is no other customizing to be done. You set up the ledgers in SAP S/4HANA using transaction code FINSC_LEDGER, which leads you to the screen shown in below screen.

Ledger definition in SAP S/4HANA

Click the New Entries button and create the entries as highlighted in Figure 1. In this example, extension ledgers E1 and Z1 are created.

To create these ledgers:

  • Type E1 and Z1 in the Ledger column
  • Enter a description in the Ledger Name column
  • Choose the Extension Ledger option from the drop-down list of options in the Ledger Type column
  • Specify the Underlying Ledger as 0L
  • For the E1 ledger, choose the drop-down option Simulation Extension Ledger in the Extn. Ledger Type column
  • For the Z1 ledger, choose the drop-down option Extension Ledger in the Extn. Ledger Type column
  • After entering these details, save (CTRL+S) these entries.

3.     Simplified data model on S/4 FINANCE

  • Data will now be stored in Universal journal table ACDOCA i,e GL, AA, CO, CO-PA and ML.
  • The Journal entry consists of a header (BKPF) and items (ACDOCA), moreover ACDOCA has a 6 digit field for the document line, whereas BSEG has only a 3 digit field.
  • The new Material Ledger Document tables MLDOC and MLDOCCCS replace most former periodic tables (MLHD, MLIT, MLPP, MLPPF, MLCR, MLCRF, MLKEPH, CKMLPP, CKMLCR, MLCD, CKMLMV003, CKMLMV004, CKMLPPWIP, CKMLKEPH).

Click here to check – Planned data on S/4 FINANCE 1610 – ACDOCP

4    New Asset Accounting.

The architecture of new Asset Accounting is very flexible now. That means you can very easily handle parallel valuation of your assets using both the ledger approach and the accounts approach.

The leading valuation can be recorded in any depreciation area. It is no longer necessary to use depreciation area 01 for this. The system now posts both the actual values of the leading valuation and the values of parallel valuation in real time. This means the posting of delta values has been replaced; as a result, the delta depreciation areas are no longer required.

New Asset Accounting makes it possible to post in real time in all valuations (that is, for all accounting principles). You can track the postings of all valuations, without having to take into account the postings of the leading valuation, as was partly the case in classic Asset Accounting.

In a new Asset Accounting posting transaction, the system creates a document for each accounting principle in the general ledger.

  • Choice of using the ledger approach or accounts approach
  • Real time postings in all valuations
  • Depreciation postings and runs complete a lot faster due to the streamlined model.
  • Data redundancy has been reduced and actuals are stored in the universal journal (ACDOCA) instead of in a variety of tables (including ANEP, ANEK, ANLC, ANLP, and ANEA). Plan and statistical data are stored in individual tables.
  • You can choose between the accounts and the ledger approach for asset postings. In the accounts approach, different valuations on different accounts are reflected in the same ledger. In comparison, if you use the ledger approach, different valuations or different accounting principles are reflected in relevant separate ledgers.

5.     New Depreciation Run

  • Planned depreciation is determined and updated with each asset master record change and each posting to the asset.
  • The depreciation run posts the pre-calculated planned values.
  • The journal entry is updated in financial on the asset level.
  • Period end closing can be performed even if there are errors on individual assets.
  •  A test can be performed but still with the restriction for 1000 assets.

6.     Inventory Valuation

Traditionally Inventory is mainly valuated with single currency in SAP ERP.

Today with S/4 FINANCE global organizations operating in different countries can valuate inventory in multiple currencies (3 currencies) this functionality is available in S4 FINANCE 1511 and higher. Material ledger provides balances per inventory account in multiple currencies, these values will be included in the universal journal.

The impacts on the inventory valuation tables xBEW(H) – tables: EBEW, EBEWH, MBEW, MBEWH, OBEW, OBEWH, QBEW, QBEWH

7.     Business Partner Functionality

Customer, Vendor and employer can be created in single transaction code called BP.

  • General data are shared across different roles
  • One business partner could perform multiple roles (eg Customer, Vendor and Employer)
  • One business partner could have multiple addresses.
  • One BP can be extended to multiple company codes.

8.     Account-Based CO-PA

  • Up to 60 Characteristics can be defined.
  • Split of Cost of goods sold posting on multiple account (by cost component)
  • The COGS posting includes all costs for manufacturing the product such as labor or material cost.
  • Split of production variances posting on multiple accounts (differentiation of price/quantity effects)

9.     Refined of Cost of goods sold postings.

Goods issue to sales order results in a posting containing following line items:

  • Line item crediting an Inventory account
  • Line item debiting an Expenses account

Different accounting principles use different income statement methods.

For example: US GAAP requires income statement by function, where in India GAAP requires income statement by nature.

Depending on the income statement method used, the account to the debit line represents:

  • Changes in Inventory of Finished goods for income statement by nature
  • Costs of goods sold for income statement by function.

10. Accelerated Close

  • Real time integration of Asset with GL, Eliminates of reconciliation steps.
  • No Separate program to be executed for balance carry forward in asset accounting. This would be done along with the GL close process FAGLGVTR
  • Continuous intercompany reconciliation.
  • Planned depreciation will automatically be calculated for the new year after having performed the balance carry forward (year end close) fast depreciation posting run due to simple processing logic, new data structures and parallel posting.
  • Complex calculations that are performed at period close, for example, the calculation of work in progress at actual costs, determination variances for production orders and results analysis for sales orders, are pushed down to the SAP HANA database in-memory capabilities.
  • Eliminates end-of-period batch job bottlenecks.
  • Enhanced reports use a logical view that combines the financial accounting (FI) line item, the CO line item, and the CO-PA dimensions to provide an income statement broken down by market segments.

11. Fiori Apps

Roles based fiori apps are built in three categories ie, transactional, fact sheet and analytical apps.

It provides a set of applications that are used in regular business functions like work approvals, financial apps, calculation apps and various self-service apps.

SAP Fiori provides all business roles in real time on compatible hand devices. It offers business roles on easy to use functions, simple with unmatched responsiveness on desktop, smartphones and Tablets.

Accounting Determination on Fiori App for On-premise 1610:

  • The app is for desktop only. Smart phone or table is not supported.
  • The app must be connected to the customizing client of a testing system, do not connect the app to a production client.
  • Up to now, the app supports G/L account assignments in the following areas:
  1. MM: The app supports all transaction keys under the transaction group RMK, which includes T-code OBYC, with customizing tables T030RT030B and T030.
  2. SD: The app supports 4 applications: V, VB, VC & VD. It covers T-code VKOAOV64OV77 and OV87. Condition tables within SAP and customer namespaces are all supported.
  3. FI-GL. The app supports the following processes in FI-GL:
  • Foreign currency valuation. Currently, only transaction key KDF (under transaction group FWA) is supported. It covers T-code OBA1, tables T030H and T030HB.
  • Transfer and Sort Receivables and Payables, It corresponds to T code OBBV (transaction group BI2), tables T030B and T030U.
  • Retained earnings account. It corresponds to T-code OB53, tables T030 and T030B.
  • Bank Account Determination for Payment Transactions in AP/AR: “Bank Accounts” view cluster.

Implement SAP S/4HANA on-premise with SAP Best Practices – Reference Guide

SAP S4HANA Cookbook