Predictive Accounting in SAP S/4HANA 1809: A foundation for Intelligent forward-looking enterprise

Gaurav Agarwal

The next step of continuous accounting is predictive accounting, and it makes sense to see through the future to plan the business operations and make strategies. E.g. how much revenue organization will make based on incoming sales order data even if no goods receipt or invoice is booked.

SAP S/4HANA 1809 has introduced predictive accounting for incoming sales orders and in this blog, I will explain how it works, what reporting capabilities are available and how to troubleshoot issues.

(A) Availability:

Scope item 2FD (Accounting for Incoming Sales Orders) covers the predictive accounting for incoming sales orders covering 36 countries.

(B) Customization Setup:

The setup to activate predictive accounting is quite simple and straight forward. It involves below steps:

1. Define Settings for Ledgers and Currency Types

Path: SPRO -> Financial Accounting ® Financial Accounting Global Settings® Ledgers® Ledger® Define Settings for Ledgers and Currency Types

Transaction Code: FINSC_LEDGER

Here a new ledger is to be created as extension ledger with type as “Prediction and Commitment” type. This type is newly introduced in version 1809. The base ledger for this should be leading ledger, so that the report can contain the actual data coming from leading ledger and predictive data from this extension ledger. No manual posting should be allowed to keep a system control on this prediction ledger from audit perspective and to avoid conflict with SAP automated process for sales order handling:

And this ledger should be extended to the relevant company codes:

And accounting principal assigned to this extension should be same as leading ledger, as predictive accounting is just an extension of your main reporting with forward-looking data:

2. Define Ledger Group

Path: SPRO -> Financial Accounting ® Financial Accounting Global Settings® Ledgers® Ledger® Define Ledger Group

Transaction Code: S_AL0_19000001

Here you create a new ledger group which contains only above special extension ledger created for predictive accounting:

3. Map the predictive ledger to the control settings:

Transaction Code: SM30 (Table FINSV_PRED_RLDNR)

Here this dedicated extension ledger for predictive accounting should be maintained, so that SAP know which one is to be used for posting of incoming sales orders:

4. Activate Predictive Accounting for Incoming Sales Orders

Path: SPRO -> Controlling ® Profitability Analysis ® Flows of Actual Values ® Transfer of Incoming Sales Orders ® Activate Predictive Accounting for Incoming Sales Orders

Transaction Code: FINS_PRED_INC_SO_ACT

For the controlling area, activate the incoming sales order with indicator “Active with date of entry”:

5. Maintain Billing Types for Predictive Accounting

Transaction Code: SM30 (Table FINSV_PRED_FKART)

Here, all the billing types which you want to get considered by predictive accounting must be maintained, e.g.:

6. Maintain SD item categories for Predictive Accounting

Transaction Code: SM30 (Table FINSV_PRED_FKREL)

Here, all the SD item categories which you want to get considered by predictive accounting must be maintained, e.g.:

7. Other sanity checks:

The above configurations are specific to predictive accounting, however other normal settings which are otherwise needed for actual PGI/Billing postings should also exist, e.g. activation of ABCOPA for controlling area, revenue account determination, posting period open etc. In nutshell if the actual posting can be done for PGI/Billing, then predictive accounting should also happen after above customization settings.

(C) Process Flow:

No new process for making predictive accounting postings. The normal sales order of sales order type configured in FINSV_PRED_FKART and having item category in line item as configured in FINSV_PRED_FKREL should post to predictive ledger as soon as sales order is saved.

E.g.  below sales order created, where no PGI/Billing yet posted:

SAP has posted to predictive ledger (0E) for PGI and Billing Simulation as shown below in table ACDOCA:

Any change in sales order impacting the PGI/Invoice simulation, will also make the adjustment postings in prediction ledger.

(D) Reporting and Analytics for Predictive Accounting:

SAP has provided out of the box fiori apps to see the impact of predictive accounting on gross margin etc. See below fiori apps in details:

• Sales Accounting Overview (Fiori ID F3228)

Here you can see that data from leading ledger and prediction ledger can be combined to see the incoming sales order impact even if there is no actual PGI/Billing:

• Incoming Sales Orders – Predictive Accounting (Fiori ID F2964)

This report shows the incoming sales order details with postings for prediction ledger:

• Gross Margin – Presumed/Actual (Fiori ID F3417)

This fiori application show the prediction postings with actual postings allows users to analyze the expected results at period/quarter end:

(E) Troubleshooting:

SAP use the AIF framework for controlling the posting flow for predictive accounting, and thus the you will be able to see the issues in the sales order replication in the transaction code /AIF/IFMON – Interface Monitor, e.g.:

Before you use the AIF monitor, make sure that you have assigned the namespace /FINPR in transaction code /AIF/MYRECIPIENTS – Recipients of Current User (Or admin can maintain for other users using transaction code /AIF/RECIPIENTS):

(Note: The fiori application “Message Dashboard – SAP AIF” can also be used for error monitoring as shown below:

)

(F) Limitations:

• For 3^rd party direct shipment and intercompany sales within selling company, predicted costs will not be calculated correctly because there is no simulation of goods issues:
• Predictive accounting only processes SD document categories C (Order), H (Return), I (Order Without Charge), K (Credit Memo Request), L (Debit Memo Request)
• If the document split is active, offsetting entries are not reduced.
• Predictive accounting does not simulate deliveries. Within customer invoice simulation, the system always assumes order-related billing.
• Customer project management and project bases services are not processed by predictive accounting.

Going through this predictive functionality, the real use cases for extension ledger are now unearthing, enabling more predictive/ simulation capabilities for intelligent enterprise without impacting the normal set of books represented in leading and non-leading ledgers. Time to get this included in project scope/ plan!