SAP Analytics Cloud (SAC) propels into Q3 2024, leveraging new features that enhance financial planning and strategic decision-making. This quarter, SAP introduces deeper integrations with Microsoft PowerPoint and advanced forecasting tools, paralleling innovations seen in tech leaders like Google and Amazon.
The highlight is the integration with Microsoft PowerPoint, allowing for live data updates directly in presentations—vital for real-time business decision-making. Deeper integration with Microsoft PowerPoint now allows financial planners to present up-to-the-minute financial data directly in their strategic presentations, ensuring decisions are based on the latest insights.
SAP has introduced a transformative update to its Advanced Financial Closing (AFC) solution with the introduction of Company Code Groups, allowing finance teams to streamline and organize financial closing tasks more efficiently. For those new to this, AFC is a robust SAP solution designed to optimize the complex process of financial closing by automating tasks, enhancing reporting accuracy, and reducing closing times.
This update marks a significant milestone for global enterprises like Siemens and Nestlé, which now have enhanced capabilities to streamline their financial operations efficiently across various business dimensions.
The new Company Code Groups feature revolutionizes financial closing by allowing more dynamic, customizable groupings of company codes. This means finance teams can tailor their processes to fit distinct business units or geographic regions with unprecedented precision. This tool simplifies handling your finances, making sure everything's up to standard with rules like IFRS and SOX, and lets you check your financial status on the fly, all from one spot.
In this blog, you will discover how SAP’s latest innovation in AFC will significantly reduce the complexity and duration of financial closing processes. We’ll delve into the technical nuts and bolts of Company Code Groups, explore their impact on flexibility and efficiency, and look at real-world applications that demonstrate why this tool is essential for today’s multinational corporations.
With the ongoing generative AI boom, businesses are seeing unprecedented scalability and accessibility in AI applications, making advanced AI tools available not just to large corporations but to startups and mid-sized businesses as well. The blend of these advancements with SAP’s innovative approach paves the way for a transformative era in business technology.
This article delves into the concept of real-time reporting, highlighting the fundamental differences between real-time and traditional reporting. We'll then explore five key advantages that real-time reporting in S/4HANA Finance offers, such as enhanced decision-making, improved operational efficiency, etc.
Additionally, we will discuss the key features of S/4HANA Finance that support real-time reporting, and how businesses can leverage embedded analytics within S/4HANA and SAC for practical real-time FI reporting use cases.
Predictive accounting enables you to take the most up-to-date data from areas in S/4HANA outside of Finance, such as Sales; other integrated products, such as SAP Concur; or external systems, and use it to predict future results at any time. You then have a better understanding of what your accounting results, at the end of the current period or quarter, might look like, and why.
Using the postings in the prediction ledger, along with the actual data from the underlying ledger, you can predict future figures, such as the revenue forecast for one product. It is also possible for you to see a report of all line items for one product. You can display and analyze the data in detail but also at a higher level, for example, in a financial statement. Since all postings, such as expenses or revenues, both actual and predicted, are stored in one place, the universal journal, you can drill down from your profit and loss statement or your balance sheet to the individual journal entries in the general ledger and display the corresponding line items.
Sr. Director- SAP Practice. Hackett Group, S/4 HANA Certified Architect & Visiting Trainer -SAP Education - SAP India & APJ. S/4HANA Conversion, CFIN, Group Reporting & Author, Cloud ALM, Public Cloud Certified
Ultimately costing principles, such as the causality principle, must be converted into practical practices with supporting tools. This webcast will examine how cost modeling has evolved over the last century. This webcast will describe the trends and obstacles that have helped or delayed developments. These evolving areas and trends include:
Dawn Watts is an experienced SAP consultant and founder of Guided Tech Solutions: An SAP consulting company specializing in SAP Finance & Controlling. Dawn has led SAP project implementations and support teams in Finance & Controlling for 2 decades. She has experience working with financial, customer service, and manufacturing teams in the telecommunications, medical devices, flooring, industrial, life sciences, and energy industries.
In S/4HANA 2022, SAP introduced a tool called “Organizational Flexibility in Financial Accounting” (also called “Organizational Change” or “Profit Center Reorganization”) which enables the changing of legal and management entities that are grouped according to organizational structures, master data and transactional data. This feature allows you to update the profit center assignment in master data, such as Materials, Assets, WBS Elements CO Orders, and creates transfer postings for selected balance sheet accounts and open payables and receivables. Watch this recorded webcast with SAP FI/CO Expert Paul Ovigele to learn the following:
- The various scenarios where Profit Center Reorganization is needed.
- How to use the “Manage Organizational Changes” app is to help you to split, combine, and replace profit centers.
- Which SAP Objects are affected by the reorganization.
- How you can navigate to related apps for organizational changes.
- Limitations of the “Organizational Flexibility in Accounting” feature.
Customers moving to the Intelligent Enterprise come from a variety of backgrounds and have different end goals. RISE with SAP is designed to address unique customer scenarios. RISE is a Business Transformation as a Service. RISE with SAP supports customers in Modernizing - on the best cloud infrastructure to achieve the lowest possible TCO, Standardizing - on the best intelligent suite to drive process efficiency and scale, Digitizing - on the best transformation platform to innovate faster than your competition
SAP offers multiple pathways to implement SAP S/4HANA latest release. One pathway is Central Finance. A typical use case is customers with different release of SAP systems or non-SAP system can leverage SAP S/4HANA features by implementing Central Finance. SAP offers SAP Central finance solution. a deployment option, to leverage latest innovations of S/4HANA by replication of posting data from different ERP systems to central finance system without disturbing the existing ERP systems. The source system can be SAP, non-SAP systems or customized home-grown systems. There are several advantages with this approach such as shared services, advanced segment/group reporting, and transform business processes to SAP S/4HANA quickly. In addition, Central Finance provides companies with an opportunity to harmonize master data on the fly and enable fast closing.
In this recorded session, you will learn key considerations of General ledger in central finance with FI/CO expert Anand Seetharaju:
- Introduction to Central Finance
- What do you need to know about parallel ledgers when implementing central finance?
- What document splitting features available with Central Finance?
- Key currency considerations you must know.
- Chart of accounts considerations
- Key takeaways
- References
Are you aware of the changes to the Controlling module with S/4HANA? Is your SAP Controlling implementation optimized to make the most of the available functionality? Are you taking advantage of the integrated nature of the SAP system and making the most out of this module?
Watch this recorded session with ERPfixers and SAP Controlling Consultant Ashish Sampat where you can find answers to questions such as below:
- What are the important changes in Controlling under S/4HANA that I should be aware of?
- Which cost allocation method is better - Distribution or Assessment, when should I use one versus another?
- What are the different standard costing methods that are available for use, and under what circumstances should they be used?
- How does one go about correcting various error / warning messages encountered during costing?
- What are the different cost objects that are available for use in SAP Controlling?
- Under what circumstances should I go about automating WIP, Variance and Settlement jobs?
- What various design options can we use to add freight and other incidental costs on procured materials?
- How can we link and analyze Movement Types (in Materials Management) to GL Account (in Financial Accounting)?
- How to separate GR/IR for Intercompany transactions?
John and Janet’s new book, on publication Jan 26, 2023, immediately entered the SAP Press Bestsellers top ten. The first edition in 2007 was the first-ever book on SAP Controlling (CO), which explains SAP CO in an easy-to-understand way and has continued to attract positive feedback from our SAP Controlling community.
The 2nd edition was released in 2011 with a revised and improved layout and new content based on SAP ERP 6.0, continued as a bestseller, and remained in the SAP Press catalog.
To completely transform the book to the latest SAP S/4HANA version, John asked Janet Salmon, Chief Product Owner of Management Accounting at SAP SE, to co-author with him. They have included S/4HANA version 2021 screenshots and content throughout the book and S/4HANA version 2022 in the new chapter 7 on event-based processing, SAP Fiori Apps, and the future direction of SAP S/4HANA.
Chapter 7 discusses new options for variance analysis delivered with SAP S/4HANA Cloud when you use scope item 3F0 (Event-Based Production Cost Posting) and SAP S/4HANA 2022, with the business function for universal parallel accounting.
In this webinar, John and Janet present a chapter-by-chapter review of the updated contents and structure and, in the process, you'll gain an overview of SAP Product Costing.
Enterprise performance management (EPM) is now viewed as the seamless integration of managerial methods such as strategy execution with a strategy map and its companion balanced scorecard (KPIs) and operational dashboards (OPIs); enterprise risk management (ERM); capacity-sensitive driver-based budgets and rolling financial forecasts; product / service / channel / customer profitability analysis (using activity-based costing [ABC] principles); supply chain management; lean and Six Sigma quality management for operational improvement; and resource capacity spending planning. Each method should be embedded with business analytics of all flavors, such as correlation, segmentation, and regression, and analysis; and especially predictive analytics as a bridge to prescriptive analytics to yield the best (ideally optimal) decisions. This presentation will describe how to complete the full vision of analytics-based enterprise performance management.
Cost components break down the costs of a material across the entire production structure into material costs, production costs, material overhead, production overhead, and other costs. However, this breakdown has not been available in the General Ledger before SAP S/4HANA. By utilizing a Custom Enhancement, the Cost Component Split by G/L Account can be available in the ECC system as well. This will provide suitable transparency about cost drivers in the General Ledger, particularly for companies that do not plan an S/4 conversion for a few years, and also positions them with a Splitting Structure that is compatible for an eventual S/4 Conversion. This functionality can be used to split cost components for COGS accounts as well as Inventory accounts and Production Variances, among others. Also, this functionality can be used whether a company uses Material Ledger or not.
Watch this recorded webcast with Controlling expert Rogerio Faleiros to learn:
- Splitting of COGS Accounts based on cost component split.
- Splitting of Ending Inventory based on cost component split.
- Customizing of accounts and posting scenarios.
- Enhancement of program to include Cost Component split for other accounts, such as Scrap, Consumption, Production Variance, etc.
- Viewing Enhanced Drilldown Reports for Product Costing and Material Ledger
Transfer pricing is a widely used functionality which sets a price between affiliated entities. It is typically setup for cross border transactions and need to conform with the tax laws in the respective countries. In SAP, Material Ledger can be used to enable multiple Valuation Views that can include or exclude the impact of transfer pricing and intercompany profit. In this regard it is used as an internal mechanism that treats every transfer between different company codes as is they occurred within the same entity, by eliminating intercompany profit and reporting in a common currency.
Watch this recorded webcast with FI/CO expert Paul Ovigele, to learn the following:
- What needs to be set up for Transfer Pricing between Company Codes?
- How is standard cost calculated for Profit center Transfer Pricing?
- How does a Transfer Pricing Posting look in the Group Valuation View?
- How is profit in Inventory identified in an Intercompany Posting?
- What changes have been made to the Transfer Pricing process in S/4HANA?
As SAP ECC customers are planning to move to SAP S/4HANA they want to know how to get started.
Join ERPfixers and Dr. Ravi Surya Subrahmanyam in this recorded webcast to learn more about:
- An overview on SAP S/4HANA & SAP S/4HANA Finance
- SAP S/4HANA transition options
- Tools that support SAP S/4HANA transition
- SAP S/4HANA readiness check for SAP ERP usage and data profiling
- Process discovery for SAP S/4HANA Transformation (evolution of SAP Business Scenario Recommendations)
- Building a business case for SAP S/4HANA transition
Variance analysis begins much earlier than month end. It begins the previous fiscal year when sales, production, and cost center plans are created. You then create cost estimates for the following fiscal year which provide plan costs for the manufacture of products, and when compared with actual costs, allow variance analysis.
With the introduction of SAP S/4HANA there have been many improvements in SAP Controlling which we'll cover in this Webcast, including new Fiori apps which access the universal journal for improved views of variance analysis.
Is your company's tax asset depreciation managed within SAP ERP or in a separate tax-specific system? Over the past 30+ years, Kent has encountered many tax managers and some finance managers, with a risk-aversion or reluctance to connect the tax asset depreciation process to SAP.
Join ERPfixers and Kent Bettisworth for this recorded session to discuss:
- SAP fixed asset designs that work for both, finance and tax departments.
- The ERP process and system challenges and suggested mitigation actions.
- Two specific SAP fixed asset designs with choices for finance and tax integration
- The impact of design choice , Tax tight integration or relaxed-integration on the risks.
Learn about the history of how SAP software has evolved over the last five decades. Topics will include CO FI Real Time Integration example in ECC; Changes brought in by HANA, cloud and various acquisitions; Important design and configuration changes for Controlling in S/4HANA; Cost Elements are now part of G/L Account; Material Ledger is mandatory in S/4HANA; Cost components and variances break down can now flow to Financial Accounting; Move towards Margin Analysis and Other Features and Innovations.
The SAP S/4 HANA Finance Group Reporting module is SAP’s latest financial consolidation reporting tool which streamlines month-end close processes by unifying operational entity and financial consolidation group close processes. The new group reporting logic was implemented as of S4 HANA 1909. The new group reporting logic includes a set of features to support legal and management consolidation
SAP Margin Analysis (previously known as Account Based CO-PA) allows organizations to gain insights into their margins, revenues, and costs of specific market segments such as products, customers, material groups and other dimensions. The goal is to provide management with contribution margin information to aid in the decision-making process. With S/4HANA, you can perform Profitability Analysis using both the Costing-based CO-PA and Margin Analysis methods. SAP recommends Margin Analysis as the default solution even though both Costing-based and Margin Analysis can co-exist. This is because, only the Margin Analysis solution updates the universal journal (ACDOCA), and all future innovations will only be made for Margin Analysis.
Many organizations that use SAP are far from where they want and need to be with improving their performance. They typically apply intuition and externally oriented financial information, rather than information designed for internal decision support, when making decisions.
To address this problem a non-profit Profitability Analytics Center of Excellence (PACE) was created. PACE is based on a framework that integrates revenue management, capital and intangible investment management, and managerial costing. The framework provides a roadmap for finance to support strategy formulation, validate strategy with operational and financial models, improve the quality of strategy execution, and support strategy evaluation for continuous improvement. The result is improved forecasting and decision making.
Foundational to the PACE framework is the “causality principle” which is the basis of scientific insight, including decision science, as it applies to economic, financial, and operational decisions. Effective economic modeling is essential for all of the enterprise and corporate performance management tools.These include: a strategy maps and its companion balanced scorecard; product, service line, channel, and customer profitability analysis; capacity-sensitive driver-based budgets and rolling financial forecasts; enterprise risk management; supply chain management; and lean and Six Sigma quality management for operational improvement. Each method should be embedded with advanced business analytics of all flavors.
One of the most misunderstood aspects in all of SAP is how to analyze production variances. This is partly because SAP’s method of Product Cost Controlling is different from other accounting software systems, in that production costs are passed through the P&L as well as the Balance Sheet. And also, because production activity (Labor, Machine Time, Overhead) is tracked using Secondary Cost Elements, which are not part of your typical Financial Statements. Even some of the most seasoned cost accountants are flummoxed with how the manufacturing information is represented in Financial and Management Accounting, and how to measure price and efficiency variances. To put it simply, Production Variance Analysis involves three steps:
Creating a standard cost estimate, which calculates the expected cost to manufacture an assembly.
Collecting the Actual manufacturing costs on a manufacturing order (production order/process order /product cost collector).
Calculating the Variance, which is the difference between:
actual costs: components, labor, overhead
actual credits: value of finished goods manufactured.
- Look into the design aspects that are jointly owned by CO, MM and PP teams. (e.g. Resource / Work Center and their Standard Value Keys, Formulae for Activity Types).
- Review options to add freight, other incidental costs in the standard cost estimates and track actuals (e.g. Costing Sheet, Additive Costs, User exit for material valuation, Accrual pricing conditions in Purchase Order, etc.)
- Understand how to investigate and rectify messages encountered during product costing
- Deep dive into movement types and account determination, analyze MM-FI accounting flow
