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Conversion of Credit Management to SAP S/4HANA

In this blog, I tried to provide a high-level perspective of steps involved in the Conversion of Credit Management (FI-AR-CR) to SAP Credit management in SAP S/4HANA. And will not cover the details of SAP Credit Management related configuration.

To keep it easy in our understanding, SAP Credit Management may be viewed more of a business governance feature in relation to Checks and Controls relating to Credit facility extended to Customers, includes various other features.  Effective use of SAP Credit Management results in improved Operational Efficiencies in the areas of Receivables/Collections and better Working Capital Management, visible impact on DSO.

SAP Credit Management is one of the components of SAP Financial Supply Chain Management in SAP S/4HANA.

To keep it simple in understanding, SAP Credit Management, can be classified into following:

1. SAP Credit Management is a part of SAP Financial Supply Chain Management (FSCM) Module.

2. Business Partner Concept in SAP S/4HANA and SAP Credit Management as a BP Role.

3. Technical and functional – requirements and  configuration that would be required for an effective use of SAP Credit Management.

4. Use of Basic SAP Credit Management do not require additional licence and  is a part of SAP S/4HANA System.

We will walk through on the below topics:

  1. Credit Management Changes
  2. Activities involved in the Conversion
  3. Activating BP/Role -SAP Credit management
  4. Documented Credit Decisions

 

I tried to keep this blog simple and also covered some high-level technical aspects for functional consultants. This blog will not cover the use of Business Partner in Financial Services.

I tried to arrange this blog in a logical sequence.  In some places it  may look confusing – as such the references would help to clarify/provide more insights into SAP Credit Management.  🙂

 

High level Functionality Changes/features:

  • In SAP S/4HANA, Credit Management (FI-AR-CR) is not available, functional equivalent is SAP Credit Management (FIN-FSCM-CR)
  • No 1:1 correlation with Old functionality
  • SAP FI-AR-CR is a purely internal FI credit management application, whereas SAP Credit Management (FIN-FSCM-CR) provides with a comprehensive, integrated, and cross-system form of credit management.
  • Several field names used in classic credit management no longer available in SAP S/4HANA
  • Use of Transaction Code BP or UKM_BP for SAP Credit Management Customer Master Data. Tcode BP, role: SAP Credit Management
  • Credit Management Master Data stored in tables: UKMBP_CMS & UKMBP_CMS_SGM
  • UKM_CASE to process sales documents (eg: releasing blocked sales orders)
  • Create a relationship with from Credit Analysts to Customers
  • Documented Credit Decision
  • Risk category -> Risk class maintained for the whole business partner (not per customer & credit control area), as the probability of a credit default of your customer does depend on the characteristics of your customer and not your internal organizational structures.
  • Maintenance of customer master data in business partner transaction
  • The credit checks carried out for a customer depend on the assigned check rule in the business partner transaction. They do not depend on the risk class (formerly risk category).
  • Releasing blocked documents via Case Management (documents the blocking reason)

Business value

  • Higher degree of automation, thanks to automatic calculation of credit scores, risk classes and credit limits
  • Credit events help the credit analyst to focus on exceptions during daily business
  • Create a relationship from credit analysts to customers
  • Process of credit limit requests
  • Documented credit decisions
  • Higher / lower account relationship of business partners (adds up exposure of lower accounts on higher accounts)
  • Less redundant data (reading FI-data via HANA view)

High-level overview of SAP Credit Management

 

Following tables are no longer used in SAP FSCM and usages in the custom codes are listed as errors during custom code check.

Table Name Description Comment1 Comment2
KNKK Customer Master Credit Management: Control Area Data Relevant for Classic Credit Management

Update to these tables to ensure backward compatibility

These tables are obsolete with SAP Credit Management (FSCM)

 

KNKA Customer Master Credit Management – Central Data Relevant for Classic Credit Management
T042B Credit Management:Credit Representative Groups Relevant for Classic Credit Management
T042P Credit Management: Credit Representative Relevant for Classic Credit Management
T691B Credit Management Groups Relevant for Classic Credit Management

Direct Mapping is available for the following KNKA table fields with SAP Credit Management Tables fields:

Table KNKK – Customer Master Credit Management: Control Area Data – Field Mapping

Table UKMBP_CMS

SAP Credit management: Credit Master Data for Partner – Field Mapping

Table UKMBP_CMS_SG

SAP Credit Management: Master Data for Credit Account – Field Mapping

KNKLI (Credit Account) PARTNER PARTNER
KLIMK (Credit Limit) CREDIT_LIMIT
CRBLB(Blocked) XBLOCKED
CTLPC (Risk Category) RISK_CLASS (Risk Category/Risk Class)
GRUPP (Customer Credit Group) CREDIT_GROUP

There is no change in Business processes because of System Conversion, however, some transactions become obsolete and are replaced by new transactions.

Some Examples:

ECC Tcode SAP S/4HANA
FD32 UKM_BP
VMK1

UKM_MY_DCDS

VKM1/VKM4 still available

Obsolete Tcodes:

F.28 – SD, FI: Recreation of Credit Data after Organizational Changes

F.31 – Credit Overview

F.32 – Customers With Missing Credit Data

F.33 – Credit Limit Overview

F.34 – Credit Limit Data Mass Change

FCV1 – Credit Management: Create A/R Summary

FCV2 – Delete A/R Summary Data

FCV3 – Credit Management: Early Warning List

FD24 – Credit Management Changes

FDK43

Master Data List S_ALR_87012215 Display changes to Credit Management

S_ALR_87012218 – Credit Master Sheet

VKM2 – Released SD Documents

VKM3 – Sales Documents

VKM5 – Deliveries

Reports Not available:
RFARI020 – FI-ARI: Extract from credit master data

RFARI030 – FI-ARI: Import Credit Master data

RFDFILZE Credit Management : Branch/Head Office Reconciliation Program

RFDKLI -*NACC Reports RFDKLXX Reports

 

 

FD33 still available for Migration Checks

 

Some of the Changes  affected by Migration:

  • IMG:SPRO>Financial Supply Chain Management > Credit Management.
  • The credit check when changing critical fields has been removed from the SD side.
  • The payment guarantee-related Letter of Credit has been removed from the SD side.
  • Review/Activate BADIs: Ukm_r3_activate AND ukm_fill

There are certain fields in classic Credit Management related tables where we can have alternatives as mentioned in the below KBAs

  • 2659692 – Replacement for S066 , S067 in S/4HANA
  • 2656921 – FSCM: How to maintain Credit Analyst?
  • 2371714 – Next Review Date and Resubmission date in new credit management

Maintenance of Customer Master Data relating to SAP Credit Management is performed using the Tcode BP and Role SAP Credit Management. or Tcode: UKM_BP. We can see the multiple tabs maintained for “Credit Profile” and “Credit Segment Data”. Pre-requisite is mentioned as we move forward.

Conversion from SAP FI-AR-CR to  SAP Credit Management (SAP-FSCM-CM)

List of Activities required for conversion from SAP ECC (AR-CR) to SAP Credit Management in SAP S/4HANA

A. Technical Settings: System and Component Landscape:

 

# Topic Component Relevance Comments1 Comments2
1 Configure SOAP Runtime Mandatory In client 000 and clients on which you are working*.

Basis/Technical Team

Please refer the relevant references

2 Activate HTTPS Port Mandatory Tcode: SMICM*. Basis/Technical Team
3 Maintain Logical System Mandatory SE11 – Check logical system maintained correctly in table T000. Can maintain in SM31*. Basis/Technical Team
4 Set up Webservice Configuration Optional

This is required if a multiple system is used ex: CRM. BADI: UKM_R3_ACTIVATE.

Configuration in receiver system is also involved.*

Please refer BADI documentation

Financial Supply Chain Management > SAP Credit Management > Integration with Accounts Receivable Accounting > BAdI: Activation of SAP Credit Management

·Financial Supply Chain Management > SAP Credit Management  Integration with Sales and Distribution > BAdI: Activation of SAP Credit Management

 

5 Pre-requisite settings for Documented Credit Decision Mandatory Set up Adobe server*

Technical Team

 

 

*These topics are supported by technical team – as such we will not discuss in this blog. It is good for functional consultants to know the activities involved.

B. Functional/Business Customizing:

# Activity Relevance Comments
1 Settings in SAP credit Management (FIN-FSCM-CR) Mandatory Example: Credit Risk Monitoring, Credit Limit check etc
2 Activating the Business Partner Role for Credit Management Mandatory BP Credit Master data is the basis for SAP Credit Management.
3 Settings for Documented Credit Decisions Mandatory Recommended: Activate BC Set UKM_DCD_CUST using transaction SCPR20. If you don’t activate this BC set, you have to manually maintain the settings for DCD in customizing – lot of steps involved.
4 Process Integration with SAP Systems Optional Setting relating to FI-AR/SD
1.     Settings in SAP Credit Management (FIN-FSCM-CR)

Check any configuration needed specifically Credit Risk Monitoring in view of the change in the design/functionality. SPRO> Financial Supply Chain Management> Credit Management> Credit Risk Monitoring. Focus only the areas required for Conversion but not the entire configuration of Credit Management during the Migration Project, idea is to save time on the conversion as it would involve change management explaining the concept of SAP Credit Management. visa-vis functional requirements. 🙂

2.     Activating the Business Partner Role for Credit Management:

BP Credit Master data is the basis for SAP Credit Management.

I have not provided the steps but captured the requirements in screen shot (Shaped Red)

Transaction Code: BUPT

Tcode: BUPT

BP>Control>Screen Sequences.

 

Tcode: BUPT

 

3. Tcode: SM30 View: V_TBZJ1C

Insert following new table entry – if it already exists fine.

 

4. In Customizing SPRO>Cross App Comp>SAP BP

 

This completes the requirements for Activating the BP Role for Credit Management. With this, if we chose the BP master data editing, you can now edit the Credit Master Data of your customers as can be seen in the screen shots provided in the beginning of this blog.

 

5.    Authorization Objects
  • SAP Credit Management : Authorization Object: F_UKM_SGMT. Credit Segment
  • Role: SAP_FIN_FSCM_CR_USER delivered with all authorizations for this authorization object.
  • Credit Segment Independent Master data for SAP Credit Management (example: Credit Score) – Authorization Object B_BUPA_RLT with role BP Credit Management (UKM000)

 

You can organize the authorizations of your users as follows:

Activities Authorization Activity
Restrict access to one or more credit segments F_UKM_SGMT with specified credit segment
Edit master data F_UKM_SGMT

01

02

03

Display master data F_UKM_SGMT 03
Delete master data F_UKM_SGMT 06
Display change documents for master data changes F_UKM_SGMT 08
Release and reject credit limit changes/increases requested (dual control principle) F_UKM_SGMT 43
Edit and display master data of SAP Credit Management B_BUPA_RLT with the BP role UKM000
Display and/or delete application logs of SAP Credit Management S_APPL_LOG with the object names and subobjects listed above

03

06

Display and process documented credit decisions S_SCMG_CAS and other authorization objects of the Case Management component

The authorization objects provided above, are for information. Further, the authorization concept also mentioned as we moved forward in this blog.

We are not discussing about Events and follow-on process in this blog as it will not impact the conversion process. It could be ongoing process, if need be.

We will restrict the blog in understanding the SAP Credit Management from the Conversion stand point and some related important concepts – but not the entire Configuration/Process relating to SAP Credit Management. And also, we will not be discussing about connecting CRM System. We will focus more about SAP ECC Conversion to SAP S/4HANA relating to Credit Management. 🙂

1.    Customizing steps for Migration

If Credit Management (FI-AR-CR) was used on the start release, a migration to SAP Credit Management (FIN-FSCM-CR) is mandatory. The necessary migration steps must be performed after the technical system conversion to SAP S/4HANA (SUM run).

(FI-AR-CR) Credit Management to SAP S/4HANA

Preparatory Activity and Migration of Customizing for Credit Management

a.     Define Settings for Credit Management Migration. Following will be defaulted

This step determines the target values for Credit Management.

The check on with Main Credit Segmt ☒ has effects on the credit segments and on the master data of the credit account. Following information will be defaulted

 

 

b.     Migrate Credit Management Customizing

This step migrates your FI/AR customizing to the new configuration of SAP Credit Management.

Following settings are migrated and is a part of Customizing Transport

Note: As a business partner in FIN-FSCM, the customer has only one  risk class for all segments. To ensure that the correct risk class  is migrated, you should have one consistent risk category for the customer in all credit control areas. To understand this, please the BP screen shots captured in the beginning of the blog.

Please also refer the above information in a tabular sequence in this blog.

 

New Authorization Concept:

Below information is only for understanding the concept – Technical team would help for the same.

  • The sales representative doesn’t need any authorizations in SAP Credit Management.
  • The documented credit decision is now created by the workflow user SAP_WFRT. To this user, you must assign a copy of the business role SAP_FIN_CR_DCD_WF. This business role includes all necessary authorizations for creating documented credit decisions in SAP Credit Management.
  • If your SAP Credit Managementis running in a one-system-scenario, the system administrator must assign a copy of the business role SAP_FIN_CR_DCD_WF to the new workflow user SAP_WFRT.
  • If your SAP Credit Management is running in a one-system-scenario, the system administrator must assign a copy of the business role SAP_FIN_CR_DCD_WFto the new workflow user SAP_WFRT.

Please note, user SAP_WFRT to be in place and need to coordinate with Technical team for the same.

Prerequisites

  • In Customizing, the SAP Business Workflow is set up under the following path:

SPRO> SAP Netweaver>Application Server>Business Management> SAP Business Workflow> Maintain Standard Settings

 

  • In addition, you have to activate the corresponding event type linkage:
    1. Enter transaction SWE2or choose the following path in the SAP menu:

Tools> Business Workflow>  Development>  Administration>  Event Manager>  Type linkages

  1. Open the object type CL_UKM_DCD_WF_EVENTand set the Linkage Activated field to active.

 

The following settings should be available:

Field Setting
Object Category CL ABAP Class
Event PUSH_DCD
Receiver Type PUSH_DCD
Receiver Call M Method
Event Delivery Using tRFC (Default)
Linkage Activated Yes
Behavior Upon Error Feedback 3 Do not change linkage
Receiver Status 0 No errors

This is a technical settings – good to know for a functional consultant.

Summary of Conversion Steps which is a part of functional/Business Customizing:

Perform the following activities in sequence:

Activity Relevance SAP Node Comments
Set number of Jobs for Activities in Mass Data Framework Optional SPRO>Conversion to SAP S/4HANA> Typically, we can keep at 30 – depends on the number of resources/landscape of the system.
Migrate Credit Management Customizing Mandatory Migration to SAP S/4HANA Finance  Preparations and Migration of Customizing  Preparatory Activities and Migration of Customizing for Credit Managemen Please refer the IMG documentation for detailed information.
Define Credit Analyst Group as Business Partner Group Optional This help in approvals of Credit Limit based on Credit Analysts. .Please refer the IMG documentation for detailed information.
Assign Credit Representative Group to Credit Analyst Group Optional The above steps is required for this step Please refer the IMG documentation for detailed information.
Define Customer Credit Group Optional Please refer the IMG documentation for detailed information.
Assign Credit Management Group to Customer Credit Group Optional Please refer the IMG documentation for detailed information.
Check and Define Credit Management Customizing Mandatory This steps helps to identify the consistency of configuration or issues if any.
Define Settings for Credit Management Migration Mandatory Please refer the IMG documentation for detailed information.
Check Customizing Settings Mandatory Please refer the IMG documentation for detailed information.
 
After the above steps are completed – the next steps is to start the Data Migration It would be good idea to start the Credit Management Data Migration after the Accounting Migration(FI) is completed.(Not set to complete please)
Migrate Credit Management Master Data Mandatory
Display Status of Migration of Credit Management Master Data Mandatory
Migrate Credit Management Exposure Mandatory As prerequisite for this step, you must have completed the Finance data migration to SAP S/4HANA up to the following activity in Customizing: Migration to SAP S/4HANA Finance  Data Migration  Start and Monitor Data Migration
Display Status of Credit Management Exposure Migration Mandatory Initialize Documented Credit Decisions
Initialize Documented Credit Decisions Mandatory DCD setting are pre-requisite
Display Status of Initialization of Documented Credit Decisions Mandatory
Reconcile Documented Credit Decisions Mandatory

Please refer the IMG documentation to understand in much detail.

Define Credit Master Data in Business Partner – this can be scheduled to a batch job through fiori app or through program:

Workflow Settings – to be configured based on the requirements. Some concepts mentioned in this blog.

The last step in FI  Data Migration is to set it to complete.

We need to ensure all the FI related Data migration activities are completed in sequence as per SPRO>Conversion to SAP S/4HANA, before setting it to complete. As this  step is very critical.

 

Please note, to do the testing  after the conversion/data enrichment is done, before taking it to production, just to ensure things are fine and as usual with enhanced functionality/features.

Thought of providing the screen shot about Documented Credit Decision how it looks. 🙂

Documented Credit Decision (DCD):

Little background about the structure of DCD – it uses the Case Management component as the technical basis for processing the DCD.

Transaction code:

UKM_CASE – Cases in SAP Credit Management

UKM_MY_DCDS – My Documented Credit Decisions

The documented credit decision for the document contains a range of specific attributes, such as the business partner, the credit segment, the open and checked credit value, the key and status of the blocked SD document, and information about approval process etc. We can find the change layout option to see further information.

The below screen shot indicates the attributes of – these attributes are a part of the configuration.

 

To sum up, below is the single chart of the above – may be a ready reckon-er!!. 🙂

 

References:

2270544 – S4TWL – Credit Management

2217124 – S/4 HANA: Credit Management Changes in SD

2227014 – S/4 HANA: Credit Management Changes in FI

2267306 – S4TWL – SD Simplified Data Models

2518127 – Handling of KNKK-KNKLI and KNKK-KUNNR during credit management migration

2700336 – RMCS1US1 and RMCS1US3 userexits during credit release from DCDs in SAP Credit Management

2760814 – Deactivate / Activate SAP Credit Management

2788718 – Configuration checklist for SAP Credit Management (FSCM)

2554785 – Upon opening transactions VKM2/VKM3 in an SAP S/4HANA system either a short dump or an error message occurs

SAP#1043195

https://help.sap.com/viewer/0bfd0ef8ac604566b03299809b86b10e/1909.001/en-US/9289b956c1db4023e10000000a44147b.html

 

Hope this blog provided a high level perspective about conversion activities from FI-AR-CR to FSCM-CM. And met its objective…. Learning is a continuous journey.  🙂

 

Thank you for reading my blog!

have a good time!!

 

regards

naag

 

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