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Author's profile photo Former Member

Public Sector Funds Management Reconciliation

It was just recently that I was once again reminded how difficult it could be for the Public Sector FI-FM reconciliation to take place with organization that did not follow the standard SAP practice.   So, after reviewing the same issues that I’ve seen in the past with State of CA public sector budget related practices, I’ve identified the similarities with another public sector organization in Connecticut as well.

Basically, the issues remain very similar and we can group them to a several recognizable categories.

SAP has and always was able to meet the public sector’s business practices and expectations, however, most of those SAP implementations deal with the following types of issues:

1.  BASIS configuration is not fully extended

2.  Database upgrade is not fully upgraded

3.  OSS notes are pulled back due to heavy custom coding not architectured with integrated point of view within their User Exists

Yes, business processes are complex, but very easy to design with many different configuration and application options when using SAP.

I completely prefer to do it all in SAP and ABAP versus in Excel.  However, our client’s seem to prefer to use the Excel to lead and validate the data in SAP. 

It takes some serious effort, time and organizational team work to correct this type of practice and to build the best SAP model for such organizations where SAP is used as a secondary system. 

Who has the resources and capabilities to assign all those necessary hours of work that would be required to correct such system configuration and space?

However, without the proper configuration in the system, and proper business practice, and without the relevant OSS notes completely upgraded, certain components and objects would not necessarily contain any relevant data.  Therefore, to expect that “only one” report that our customers would “only” require, “quickly”, could not be possible.   Based on the wrong configuration and lack of master and transactional data within the objects necessary to integrate for such reporting, that is not feasible, so that would be the first realization point that our clients would need to face.  Also, the integrated-FM reconciliation report could not be customized in 2 weeks as it wouldn’t be meaningful to assume that integration was possible to take place when certain transactions were posted and settlements took place as if system was properly used and configured.  Each business process and scenario would need to be re-evaluated and test prototyped to address any differences in balances between different modules within the organization, which will be addressing the cost flow scenarios as well.

The more we deviate from the standard SAP best practices, the more we need to customize and use the Excel and other tools to compensate the integration.  In such case it would take much longer for SAP consultants to produce that CAFR true reporting scenario out of system where SAP was used as a secondary system of record.

Staying very close to SAP teachings will prevent such labor intensive effort and allow the public sector reporting and planning to be as easy as it was intended to be.

Thank you.

Alexandra Weber

SAP IBC Senior Delivery Consultant

Business Process Expert and Integration Architect since 1994

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      Author's profile photo Former Member
      Former Member

      Hello Alex,

      Glad to hear from you.

      It is so true that we should always stay with SAP best practice.Correctly mapping organization's business processes to SAP configuration is vital. The frustration part is oftern time consultants, business analysts and business owners do not have comprehensive understanding of what SAP functionality can achieve from business point of view. They quickly get lost in the technical details, start ABAP coding without architectural design and resort to using tools like Excel. One example is that some people still do not know Fund Accounting can fully accomplish GASB 34/35. Another example I saw recently on the forum is people do not seem to realize that CO actual activity price calculation is what they need when they are struggling to come up with the actual cost for grants billing.

      I believe SAP should make more effort to bring people into the big picture and enlight people on how module and integration functionality fit their business functions.

      Best regards,


      Author's profile photo Former Member
      Former Member


      It is great to collaborate once again and only minds like yours can follow this complex but capable system and use it as expandably and extensively like you've done. 

      I will add to your examples situations where we see that New GL splitter was used together with contradicting functions of FMDERIVE account assignments, and therefore ofther FI and FM teams are trying to figure out why the postings went wrong.

      I am sure you can share the similar situations done with FI and MM with cross related functions with FMDERIVER and actually see how those powerful and integrated SAP business processes and offerings can also confuse our customers. 

      Like you said, we should teach on those examples and collaborating like this together can bring us closer to accomplishing more of those team objectives.

      Thank you - it is great to hear these stories with such an amazing impact for our customers.

      Kind Regards,


      Author's profile photo Frank Godeby
      Frank Godeby

      Hi Alexandra,

      Good Topic. I was involved in the development of fmderive and the reconciliation tool. We worked at a customer site trying to reconcile NewGl and fm after live data has been produced over several months. It was a huge job with a lot of repostings. The flexibility of the product was your best friend and your worst enemy if people did not fully understand recon implications.

      Reconciliation has to be the mantra from (blue-print) day one on ... Otherwise someone will try it years later .... with many year ends the pain is growing.



      Author's profile photo Aleksey Stephen
      Aleksey Stephen

      Very interesting comments Frank and Alexandra.

      I can see how substitutions and abap could conflict with fmderive.

      Can you give an example where the splitter could cause a mismatch with fmderive?

      Also, we are looking at using the reconciliation tool now in our implementation.

      From what you say it looks like it could be important to do it early - I assume you are talking about the Reconciliation Data Slice/Reconciliation Rule IMG function here, to reconcile fm vt payments to bank account?

      Thanks, Aleksey

      Author's profile photo Frank Godeby
      Frank Godeby

      Stephen, most of the reconciliation issues came from soft-derivation, where users were allowed to overwrite derived values or in case of exceptions rules that have been changed over the years. E.g. one of the derivation rules we always used: Accounts derive commitment items and there are no exceptions/no overwriting.

      Otherwise it could happen that FI-Postings are seeking FM-Postings, but they do not exist because they used a commitment item with financial transaction 50. So once a posting is only partially posted in FM, then you have no chance to reconcile cash either. But that is obviously only one example.

      Yes I am talking about "Reconciliation Data Slice/Reconciliation Rule IMG function".

      Cheers, Frank.