#S4HANA 1610 use case series: 7b – Finance (tech view)

After taking a look at the business aspects in Finance with the SAP S/4HANA 1610 release in the last blog, we will dive a bit deeper into the technical aspects of Finance in the 1610 release. This use case series focuses on the SAP S/4HANA 1610 release to bring some light into the innovations and enhancements and make them more relatable through use cases.Finance in SAP S/4HANA 1610: Now fully integrated innovations

In the previous use-case blog “How to get visibility into the global business performance” we explained the many new capabilities of SAP S/4HANA 1610 for the finance functions and specifically the new functions added to manage global corporation’s business performance while driving compliance and efficiency of the whole finance function. The reason for the broad scope is the result of the addition of the entire scope of SAP S/4HANA Finance 1605 into SAP S/4HANA Enterprise 1610. And even more functionality has been added to that on top, so that from now finance innovations are always fully delivered with innovations in logistics in one integrated SAP S/4HANA solution. Let us now have a look into important technical use cases added to SAP S/4HANA 1610:

Universal Journal: Subsequent Introduction of a Further Accounting Principle in the General Ledger

Companies are increasingly required to produce financial statements based on different accounting principles including IFRS, US GAAP, or local legal requirements such as the German HGB. The ledger approach for parallel accounting is recommended. The ledger approach in SAP S/4HANA operates on the assumption that common postings are made to all ledgers. For this purpose, postings from just one valuation view are only made to the specific ledger. For example, if the posting is only relevant for the leading valuation, this can be a posting to the leading ledger. However, if the posting is only relevant for the other (non-leading) valuation, this can be a posting to one of the other ledgers.

With SAP S/4HANA 1610 you can subsequently introduce additional parallel ledger with new accounting principles. A guided approach in a project cockpit supports you in setting up your new ledger and conduct a data load of the relevant accounting data from a sources ledger into the new ledger. For example customers running an existing classical GL in SAP ERP and want to move to SAP S/4HANA 1610 could also use this function to subsequently add parallel ledgers in a second step after migrating their current GL to SAP S/4HANA.

Universal Journal: Multi-Currency

In SAP S/4HANA 1610 the Universal Journal now supports up to 10 parallel currencies per ledger which give you a maximum flexibility: the local currency (fieldname HSL) and global currency (field name KSL) as well as 8 freely defined currencies of a configured currency type (with the field names OSL, VSL, BSL, CSL, DSL, ESL, FSL, GSL).

Additional currencies are very often requested for use cases such as functional currencies, hard currencies or for example to create valuations in different currencies.

The new currencies are converted in real time for each journal entry according to the specified currency conversion settings. The following business processes can handle the new currency types:

Open Item Management in:

• General Ledger Accounting (FI-GL)
• Accounts Payable (FI-AP)
• Accounts Receivable (FI-AR)

Allocations in:

• Financial Accounting (FI)
• Controlling (CO)

Realtime Consolidation and New ACDOCC

The new consolidation for SAP S/4HANA enables you to perform financial consolidation in real time. The consolidation is performed on actuals data of the universal journal (ACDOCA) on line item level, and it uses the integrated consolidation capabilities of SAP BusinessObjects Planning and Consolidation 10.1, in the embedded version. Unified staging and storage of finance data provides high data quality and eliminates redundancy. By leveraging SAP S/4HANA technology, Real-Time Consolidation supports top management with timely and confident consolidated financial statements.

Consolidation preparation is carried out in SAP S/4HANA, i. e. the Data Modeling happens directly on the financial master and transaction data of SAP S/4HANA. The flexible upload allows you to report financial data from non-integrated source systems. Groups and local accountants monitor, lock and unlock data for consolidation submission. Currency translation for consolidation is also happening directly within SAP S/4HANA.

SAP Business Planning and Consolidation writes-back the consolidated results to the new SAP S/4HANA consolidation journal (table ACDOCC) for reporting of the consolidated data in SAP S/4HANA.

Planning is comping home and New ACDOCP

Beside of the new realtime consolidation capabilities, SAP BusinessObjects Planning and Consolidation 10.1, embedded version, comes with planning, budgeting and forecasting capabilities entirely integrated, while remaining flexible. You can run simulation scenarios on flexible planning levels, periods, preliminary master data, workflow, comments and a MS Excel-Frontend. Planning data is stored within the new table ACDOCP, so that overall you have a consistent approach for the universal journal data:

• Actuals: ACDOCA
• Consolidation: ACDOCC
• Planning: ACDOCP

Planning & simulation scenarios supported with SAP S/4HANA 1610 are primary cost planning of cost centers, simulation of cost allocations, cost center tariff planning, activity consumption planning, cost center fixed consumption planning and a first version of Sales & Profitability Planning.

Example: cost simulation scenarios

Stay tuned when we take a closer look into the next use case, Product Lifecycle Management.

Discover the full scope and benefits of SAP S/4HANA 1610

• SAP S/4HANA 1610 Release Highlights Brochure
• SAP S/4HANA 1610 Release Information
• Discover SAP S/4HANA

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Here the link to Part 7a:

https://blogs.sap.com/2017/01/18/s4hana-1610-use-case-series-7a-finance-biz-view/

Link to the series:

https://blogs.sap.com/2016/11/09/s4hana-1610-use-case-series-intro/