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SAP Business ByDesign Financials Vs SAP Business One Financials

As a result of SAP’s continuous efforts to meet advancement in technologies and industry expectations SAP Business ByDesign (SAP ByD) cloud based ERP solution is available for mid market customers. As there is already SAP Business One solution is also available for mid market most of customers asked why we should go for SAP ByD so i will try to compare the feature in financial modules of both systems as financials are backbone of each business. For other modules i will try to compare in my other blogs.

Before starting anything i would like to clear one thing this blog is not intended to discourage any product/service offered by SAP or any other company to its customer, purpose of this blog is just to help the business users and decision makers to select the proper ERP product which fits to their needs. 

SAP ByD is the product for small and medium enterprises (SME) while some people says SAP Business One is also for Small and medium enterprises but in some cases medium enterprises with complex business process high requirements cannot use SAP Business One.

Below is the comparison of SAP Business One Financials and SAP ByD financials

  1. If you requirement of different financial reporting like one financial reports as per IFRS and one set as per GAAP or tax requirements with SAP ByD you can set different Books Of Accounts for different financial reporting requirements and whenever these is financial transaction it will effect all the books automatically while with SAP Business One you cannot achieve this only possible option is to have different companies and use some development or integration to replicate data.
  2. Like above in SAP ByD you can have multiple chart of accounts for one company and chart of accounts are linked with financial books and transactions automatically effects the GLs in different chart of accounts. While SAP Business One does not offer any such feature.
  3. You can have different financial periods for different financial books like one period starts from 1st Jan to 31st Dec and another one with 1st June to 31st December and you generate financial reports based on these periods. While SAP Business One have option to create only one posting period for one company
  4. SAP ByD offers different posting methods for revenue recognition like realizable, accrual, deferring to other accounting period and after booking system will auto clear revenue from accruals to actual sales revenue accounts. While SAP Business One does not offer different methods of revenue recognition.
  5. Similarly for revenue recognition SAP ByD Supports different accrual methods for different sales documents like point of invoice, Point of delivery, Continue to defer, Reverse deferrals and accruals, Recognize based on manual amounts i.e when you want to book your revenue at the time of delivery of Invoice. While SAP Business One does not offer any such feature.
  6. SAP ByD offers built in analytics like early margins information from Sales. While In SAP Business One version for HANA built in analytics are available but not in details like SAP ByD.
  7. In SAP ByD purchasing supports different account assignments like cost center, project, sales contract, sales Oder,service order, individual material(IMAT) and subsidiary ledger depends upon these assignments also. While in SAP Business One you can assign cost centers, projects or internal purchasing for stock only.
  8. In purchasing  SAP ByD offers invoice receipt concept (GR/IR) to confirm invoice from vendor is received and if there is any variance its understood and accepted. this invoice receipt is saved in system before booking final invoice. While in SAP Business One there is direct invoice after receiving goods. If there is any variance obviously it will effect the inventory cost but  there is no document between goods receipt and A/P invoice to save the information of invoice received and ongoing communication with vendor to resolve the discrepancies.
  9. SAP ByD offers document flow to see the history/details of base documents while SAP Business One Offers relationship map to see history/details of all base documents.
  10. SAP ByD offers project types like direct cost projects, overhead cost project, Customer and multi customer projects and financial transactions are restricted automatically as per project types. While business one only offers project types as internal or external and there are not much extensive controls to book revenue and cost based on project types.
  11. For project planning and budgeting SAP ByD offers feature to plan service and materials required for project using pre-defined methods. While SAP Business One does not offer any such facility.
  12. In SAP ByD production module to save the variance user has to confirm he understood variance reasons and then by wizard he can post variance and clear the work in process accounts, While SAP Business One does not offer any such wizards only concept of production order closing is there and system clears the variance at teh time of production order closure.
  13. In SAP ByD Costing methods depends upon company, cost type and product category and its same in SAP Business One also.
  14. In SAP ByD you can save the cost center rates for cost also without linking any resource or labor item.  While in SAP Business One you cannot save cost center rates.
  15. In SAP ByD you can upload item master by import feature, in Business One also you can import by excel.
  16. SAP ByD offers  automatic creation of supplier invoices just by scanned copies of PDF, RTF, DOC, TXT format, user will just review and clear exceptions of missing information then supplier invoice is created. SAP Business One offers feature of electronic documents but no option to review like SAP ByD. In B1 its either errors in uploading or successful uploading no concept of partial uploading.
  17. SAP ByD offers expense reimbursement management with different expense types and reimbursement groups, expense can allocated to customer contract, project task, cost center, sales order and service order. SAP Business One does not offer any standard features for this however simple workarounds cater this requirements with the help of A/P invoice but assignment to sales order and services orders required customization
  18. SAP BYD offers VAT setup by country and based on customer and buyer location, vat return runs to calculate all vat and vat report to show net receivable / payable amount and then payment to authorities after approval from system.. In SAP Business One some localization offers VAT setup based on buyer and seller locations and input and output VAT reports are there but there is no concept of finalizing VAT returns.
  19. SAP Business ByDesign uses a tax decision tree as per country (if you have multiple countries in system)  to correctly determine the tax codes. While SAP Business One has simple setup to define tax codes.
  20. In SAP ByD and Business One automatic payments and receipts by run based on predefined payments methods and some bank formats of certain countries are also available.
  21. SAP ByD offers petty cash management with the help of petty cash account definition, balance count and with transfer cash from bank to petty cash account facility by using specific form for this transaction. SAP Business One have simple definition of cash account and there is no dedicated documents for petty cash management,
  22. In SAP ByD there is liquidity management for batter cash flow planning in terms of receivables and payable according to due dates. SAP Business One has simple cash flow and aging reports the is no standard consolidated report of liquidity.
  23. SAP ByD has period end closing and tax adjustments in single books of accounts or multiple books of accounts while SAP B1 has no concept of different books so only one period end closing.
  24. SAP ByD offers separate form for tax adjustment journal entries while SAP business uses same form of Journal entries for all.
  25. In SAP ByD user cannot close a period if open transactions like open draft documents exist for the period. While SAP Business One does not have any such checks.
  26. In SAP ByD you can lock each specific transactions in a closed period while SAP has not option to select each transaction,
  27. User can use different runs before period end closing like reconciliation run, depreciation and revaluation runs in both system like SAP Business One and ByD.
  28. In SAP ByD Income statement is based on functional areas like Sales and Direct cost as main titles. While in SAP Business One you can achieve this by defining financial report templates.
  29. In SAP ByD balance sheet can also be based on cost centers and cost center groups, one company or multi company and multi books of accounts. While in SAP Business One you cannot generate balance sheet based on cost center and for multiple companies, for multiple companies you need to have inter company add on as in SAP you cannot have multiple companies in one database.
  30. In SAP ByD there are purchase and Sales registers other than General ledgers and 130 standard reports related to General Ledger. While in SAP Business One there is no sale or purchase registers its only sales / purchase analysis reports.

Thanks everyone for reading this blog.

Happy Working to All!

6 Comments
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  • Excellent post, Abdul. Very pointed and clarifies the differences between both products.

    SAP ByD is more robust and fits better for complex business and/or complex processes.

  • Of course, the question from the customer’s point of view is justified, according to which criteria one should decide between two SME products of a company.

     

    Of course, such a functional comparison can help make the right decision. However, it would like to correct the information about the functions that are not supposed to exist in SAP Business One as follows (Since the headline is a comparison of the financial function, I will only refer to the financial functions given here):

     

    1. Requierements regarding different financial reports, e.g. HGB, IFRS, USGAAP.

    In SAP Business One, different financial report templates can be used for e.g. Generate profit and loss account, balance sheet or totals and balances list.

    Based on a German company with HGB and simultaneous need for USGAAP reports, the procedure would be as follows:

     

    • Create your CoA based on HGB accounts
    • Create your financial reports by using the standard structure of the CoA (HGB)
    • Create the additional account which needed for IFRS or USGAAP
    • Create additional financial report templates (balance sheet, Profit or loss etc.) based on the current structure of the CoA (including the IFRS/USGAAP accounts)
    • Result: for each financial report you have two different templates, one for HGB and one for e.g. IFRS
    • Reconciliation postings are posted to the journal as usual, namely to the IFRS / US GAAP accounts. By using the different templates you are able to use all financial for different financial reporting requirements

     

    This solution is 100% mappable in the standard of SAP Business One

     

    1. Multiple chart of accounts

    In SAP Business One, it is quite possible to work with multiple charts of accounts. There is the possibility to associate each account with an external code (from another chart of accounts, for example corporation chart of accounts). All financial reports available in the standard can be executed after the external code.

     

    So far multiple chart of accounts is part of the standard of SAP Business One

     

    1. Revenue recognition

    It is true that you cannot post automatic accruals in the SAP Business One standard, but you can easily create recurring transactions for them.

    Alternatively, we have a very fine solution that allows you to automatically create the accrual postings for both purchasing and sales documents.

    How the automatic accruals works in SAP Business One can be accessed via the following link:

    https://youtu.be/jWwzvKHLDLI

     

     

     

    1. Analytics for sales margins:

    In SAP Business One, you can call up the “Last Prices” overview directly from a receipt – while processing a transaction – and output the historical values such as sales prices, purchase prices or gross profits. It is therefore quite possible – even with a different approach – to analyze these values (even without HANA)

     

    1. Purchasing Support different accounts

    In SAP Business One, you can assign G / L accounts, cost centers (namely, multidimensionally up to 5 different ones), projects, and cost elements to purchasing, sales, and stock for all transactions and transactions. And that is possible since 2003!

     

    1. In purchasing SAP ByD offers invoice receipt concept (GR/IR) to confirm invoice from vendor is received and if there is any variance its understood and accepted….

     

    Basically, you can decide in SAP Business One whether or not inventory accounts are posted at goods receipt (keyword: continues stock). Regardless, incoming invoices can be saved as a draft documents. The drafts can be checked and changed at any time. Only when the bill is added, this is fixed.

     

    1. Document flow

    This is the document flow in SAP Business One:

    https://www.youtube.com/watch?v=LbOoiQJZdJE

     

    What information is missing here to speak of a document flow?

     

    1. Upload master data

    Although the following note has a very irritating note, nothing to do with finance, I would like to note that in SAP Business One the item master can be imported and exported via Excel as well:

    “In SAP ByD you can upload item master by import feature, in Business One so you can import by excel.”

     

    1. Automatic creation of supplier invoices.

    You write that SAP Business One brings errors in the failed data or confirmation upon successful upload, but does not support partial uploading. Whatever this means, if that works differently in SAPByD, I find the approach of SAP B1 better, because I can not do anything with partially uploaded supplier invoices.

     

    1. Finalizing VAT returns.

    In the German localization there is the ELSTER module (= electronic tax declaration). Thus, the tax data can even be transferred online to the tax authorities.

     

    1. User text definitions

    Contrary to your statement that SAP B1 only contains a simple set-up setup, there is the function “Tax code determination”. Thus the correct tax can be defined according to umpteen criteria. Based on these rules, the correct tax codes are automatically transferred to the documents.

    100% in the standard and very flexible even possible!

    Here the solution:

    https://www.youtube.com/watch?v=k4ejps4ajnM&feature=youtu.be

     

    1. Petty cash management

    Use the link below to see how we have solved petty cash management in SAP Business One:

     

    https://www.youtube.com/watch?v=hrZrbRH-QdE

     

    1. Liquidity Management

    Whether liquidity management in SAP Business One is simple or not is probably more subjective. In any case, there is the possibility of taking into account not only invoices but also orders and open deliveries in cash flow. Furthermore, SAP Business One allows to integrate recurring transactions (such as rent). The cash flow report with so-called pseudo-claims and pseudo-obligations becomes really flexible. Using HANA, there are even more possibilities in cash flow management.

     

    1. Seperats forms for journal entries

    “SAP ByD offers separate form for tax adjustment journal entries while SAP business uses same form of Journal entries for all“

    Why would it be better to use two different forms for journal entries? The fact that the user does not have to change over and books as in SAP Business One in a mask, I find rather advantageous over SAPByD

     

    1. “In SAP ByD you can lock each specific transactions in a closed period while SAP has not option to select each transaction”
    • what should that be good for?

     

    1. Balance sheet based on cost center

    At least in Germany, it is not common to book balance accounts with cost centers. Therefore, there is no need to create a balance sheet by cost center.

     

     

     

     

    • Hi Ercan Atici

      Thanks for your comment first of all i like to mention one thing its up to business user to decide based on his/her requirements.

      When we are comparing two products it means we are comparing standard features not customization, workarounds and development because if we consider about customization, workarounds and development then no need of SAP Business One also you can buy any cheap application, do workarounds, develop and customize it as per your need because any business application will have basic features to run a business, you can add whatever you want by development. But In today’s world everyone want to have a user friendly system where end user can do changes as per his/her needs , end user don’t need to go to a technical guy explain all his stories and wait for workarounds.  Similarly standard systems with less customization and complexity are easy to run, error free and more mature.

      Similarly no need to go for S/4 HANA solution just buy business one add workarounds, developments and fulfill all business requirements. 

       

       

      Anyhow i will not go in detailed arguments once again i will try to explain in the context of your solutions.

       

      1. In SAP Business One, different financial report templates can be used for e.g. Generate profit and loss account, balance sheet or totals and balances list.

      I agree you can create accounts for IFRS and use financial reports templates but it work only for simple presentation of reports there are some cases for companies working in different countries, they have to post multiple journal entries as per regulations of each country like 

      GAAP Country A:

      Financial reports order should be Liability Accounts>Asset Accounts>Inventory Accounts>Third-Party Accounts and So on…

      G/L account number should be in sequence like starts with 1 for liabilities ,2 for assets

      Journal Entries numbering should be start from 1 each month and it should be separate for each transaction type

      Similarly tax years starts from 1st July and ends next year 30th June

      GAAP Country B:

      Financial reports should start with assets > Liabilities > Capital & Reserves and so  On. Numbering sequence of G/L should be 1 for assets 2 for liabilities 3 for capital & reserves and so on.

      Numbering series should be continuous for any type of journal entry and Sales revenue should be posted as unrealized revenue first then at the time of Invoice it should move from unrealized accounts to realized and receivables accounts.

      Tax year starts on 1st Jan and end on 31st Dec.

      Now when ever user post sales invoice transaction it should reflect in system according to two different numbering series, two different sales accounts, two different receivable accounts because G/L account codes are different for each country.

      You cannot use financial templates. If you want to use financial report templates then its very difficult to maintain correct numbering of accounts secondly whenever you create a new account in chart of account you have to update the financial report template also & you cannot have different numbering series according to financial report templates. 

      If there are no separate chart of accounts and multiple enteritis managing different tax years will be very difficult. 

      Multiple chart of accounts

      Like i explained above you cannot fulfill all of your requirement with financial reports templates and regarding external code feature you have only one field of external code and there is no field for external name and similarly of i need three chart of accounts for my three companies operating in different countries under one entity ? What i will do i will configure three different companies ? and increase labor work like whenever there is a small change IT has to update three databases ?

      2. Revenue recognition

      SAP Business One does not offer concept of unrealized/unapproved and realized/approved revenue like in most of construction company when they completed the work and send invoice to its client, they want to book this as unapproved revenue and unapproved receivables . Because in construction in some cases invoices amount is very huge and both parties has to agree on work completed first, if there is period ending and they booked the invoices without approval from customers, later on it will be revised then its too much cancellation and reversal entries.  One thing they cannot issue A/R credit  memo because A/R credit memo means sales return which rarely happens in construction. 

      Similarly in case of accruals ByD automatically transfer balances form accruals to actual accounts without any user efforts and navigating in different screens.  

      3. Purchasing Support different accounts

      In SAP Business One, you can assign G / L accounts, cost centers (namely, multidimensionally up to 5 different ones), projects, and cost elements to purchasing, sales, and stock for all transactions and transactions. And that is possible since 2003!

      I already mentioned business One has cost centers but it does not support sales contract, sales Oder and service orders assignment to purchase transactions if you want to use dimensions of cost centers for sales contract, sales Oder and service orders assignment then first it will increase the labor work because whenever there is any sales contract user has to define the cost center also and cost center cannot be defined by limited logistics user, Secondly if i started using my dimensions for documents like sales contract, sales Oder and service orders assignment then i will have limited dimensions for some of practical requirements like expenses by department, fix assets, divisions or locations because normally people use dimensions for department, fix assets, divisions and locations. 

      4. In purchasing SAP ByD offers invoice receipt concept (GR/IR) to confirm invoice from vendor is received and if there is any variance its understood and accepted….

      If you saved the invoiced as draft then there is no financial effects of drafts and there is no specific document number assignment. For example you are saving draft on last day of posting period when next morning you generate your financials drafts will not reflect in your financials while it should reflect with provisional amounts which will be cleared later one.

      If you think you will save these drafts and generate your financials and after that once its finalized you will cancel and re post with correct figures this solution will not work where you have 100s of transactions per day i know some customers where transaction volume is huge ever day. Canceling and posting reversals will create too much transactions in financials which will be very difficult to understand in like if you want to reconcile your ledger with supplier it will be very difficult because you had a lot of reversals. 

       

      5. Automatic creation of supplier invoices.

      You write that SAP Business One brings errors in the failed data or confirmation upon successful upload, but does not support partial uploading. Whatever this means, if that works differently in SAPByD, I find the approach of SAP B1 better, because I can not do anything with partially uploaded supplier invoices.

      Business One does not support import of PDF and Doc Files and secondly in some cases your business partner is unwilling to share the documents as per your customize fixed format like in business one there is standard formats for DTW or electronic documents and its txt or csv. If a document is not uploaded fully instead to rectifying in my upload file and re uploading why not i should directly rectify in my system. 

      6. Document flow

      As i already mentioned its available in both applications then what you want to show ? 

      7. User tex definitions

      Business One does not support complex tax setup like i have below scenario

      I purchase an item 1 at price $10 per unit  and tax is 17%, my vendor gave me discount of $2 now tax authorities wants me to book tax on $10 per unit and inventory at $8 per unit. Tax authorities want to to book tax amount of $10*17/100 while business one will book VAT at $8*17/100.

      8. Petty cash management

      As i explained before we are discussing standard solutions not customization and workarounds, if we have to incorporate workarounds and customization then why we should invest even in SAP B1 just buy any application and deploy workarounds and customization.

      9. Separate forms for journal entries

      The edge of separate form is we can define authorizations for uses who can adjust tax accounts

      10. “In SAP ByD you can lock each specific transactions in a closed period while SAP has not option to select each transaction”

      I want to allow posting of  journal vouchers / incoming payments in closed periods because normally customers pay in subsequent or later periods. If i allowed all transaction like in SAP b1 may be user can post other documents by mistake or deliberately. Anyhow there is solution available for it in business one to deploy a code to restrict but its customization. 

      11. Balance sheet based on cost center

      In Some countries there are business cases to generate balance sheet by cost centers. 

  • I do not want to go into every single detail again. I would like to say that you seem to have less idea of SAP Business One than of SAP ByDesign. Most of your answers are not correct! That, for example, external code is possible, but no external description, that’s already possible.
    In short, I can understand that you want to convey the differences between the two systems to an interested party, but your article tends to aim to make SAP Business One bad.

    That’s the wrong approach.

     

    • Dear Ercan Atici

      Passing general comments like “article tends to aim to make SAP Business One bad” is not a good approach. Once again if you have any concerns express it with proper standard features explanation and examples.

      In other words you are trying to say just buy a Toyota corolla and fill all your needs, this is actually wrong. One customer has expectations of Mercedes S Class and you are trying to say no no go for Toyota corolla it has everything. Why someone who has expectations & budget of Mercedes S Class should go for Toyota Corolla.

  • Hi Abdul,

    I’m glad when I read your post. I had researched SAP Business One for 3 years before I studied SAP By Design  1 year ago. Therefore, I also think that SAP ByD has superior features than SAP B1. I hope you will have more posts about SAP ByDesign,

    Thank for your writing.

    Phuong,