SAP S/4HANA Cash Management is the finance application where business users can immediately see the huge advancements when comparing to the old SAP ERP predecessor application.
In this blog post, we will take a look at what is new in release 2020. There are 3 major functional areas of SAP Cash Management— Bank Relationship Management, Cash Operations, and Liquidity Management. I will give you an overview of new or enhanced functionalities for each of these areas.
For delta in release 1909, you may refer to my previous blog SAP S/4HANA Cash Management – What is new in release 1909.
Bank Relationship Management
Bank Account Ledger
Probably the most significant change coming with S/4HANA 2020 in Bank Account Management is the introduction of decoupled Bank Account Ledger (aka a reduction of GL accounts). This enhancement brings many changes in the area of GL and bank account master data, in the payment configuration and financial reporting.
Until now, you were required to create and assign separate GL accounts to different house bank accounts. This led to the proliferation of GL accounts in the group Chart of Account, with large companies creating and maintaining thousands of GL accounts just to run payments. When thinking of typical processes surrounding the governance of GL accounts master data in a multinational corporation, you can imagine how much effort and time it adds to opening a bank account. Also for SAP to deliver content especially for the cloud, the need for decoupling of Bank Account Management from GL becomes evident. Therefore, starting from S4hANA Cloud 2008 and S/4HANA OP 2020, a new approach has been introduced.
1. Bank Reconciliation account
The new GL account type “Cash account” has been introduced. Once you select the Cash Account in the GL account master data, a new mandatory field GL account subtype becomes visible. Here you need to select the GL account subtype:
- B – Bank reconciliation account
- S – Bank Subaccount
- P – Petty Cash
If you select “Bank Subaccount” you need to specify the value in the new field “Reconciliation account” which refers to B bank reconciliation account. Please refer to Define G/L Accounts for Payment Processes.
In the next step, you need to assign the bank reconciliation account in Bank Account Master Data. Please refer to Assigning G/L Accounts to House Bank Accounts.
2. Simplification of automatic outgoing payments configuration
Financial Accounting-> Bank Accounting -> Business Transactions-> Payment Transactions-> Electronic Bank Statement->Make Global Settings for Electronic Bank Statement
Select the SIP Relev. (Self-Initiated Payment) checkbox for the account symbol to enable it for use in automatic payment programs.
IMG: Financial Accounting->Accounts Receivable and Accounts Payable->Business Transactions->Outgoing Payments->Automatic Outgoing Payments->Payment Method/Bank Selection for Payment Program -> Assign Account Symbol to Payment Methods
Specify the account symbol to use for a combination of country/region with the payment method.
IMG: Financial Accounting->Accounts Receivable and Accounts Payable->Business Transactions->Outgoing Payments->Automatic Outgoing Payments->Payment Method/Bank Selection for Payment Program ->Set Up Bank Determination for Payment Transactions
3. Closing of a bank account
The new Bank Account Ledger requires an extension of the bank account closing process. In the previous releases, you could set an active bank account as a closed in the bank account master data but there was no integration to payment processes, etc. In order to block postings, the GL account must have been set with a posting block. This is not possible with a new bank ledger functionality because blocking GL account assigned to multiple house bank accounts would result in the blocking of all these bank accounts.
In previous releases, a bank account could exist in one of three statuses: Inactive, Active, and Closed. Starting from 2020, there are 3 more bank account statuses possible: Marked for Closing, Closing Request Sent to Bank, Closed at Bank. Once the Closed status is obtained, the Posting block is set automatically in BAM.
New functionality is described in SAP help in the Closing and Reopening Bank Accounts section.
4. The “defaultable Business partner” concept
Companies that hold financial instruments are subject to the disclosure requirement according to international accounting standards i.e. IAS 32 and IFRS 7. These standards require them to report their exposure to risk. This impacts not only companies in the financial services industry but all entities that hold financial instruments including simple instruments such as borrowings, accounts payable and receivable, cash and investments.
One of the options for how to meet these reporting requirements is to group the respective financial instruments by type and counterparty. In the previous releases, companies could use GL accounts to group bank accounts. With the new Bank Account Ledger, this might not possible. In S/4HANA 2020 release, a new field Defaultable Business Partner has been introduced in the Manage Banks app. The defaultable business partner represents counterparty in the sense of IAS 32 and IFRS 7. At the same time, the original bank business partner has been renamed Risk Business Partner.
5. Bank account grouping in financial statements
In the context of the above-mentioned disclosure requirements, bank account balances can be reported in the analytical reports grouped by defaultable business partner assigned to the corresponding bank. The grouping feature is supported for Financial Statement versions that are created using the Manage Global Hierarchies app. In the financial statement version, you can select the Bank Account Grouping checkbox for bank reconciliation accounts you wish to activate grouping for.
Manage Bank Account app improvements
There have been numerous enhancements in the Manage Bank Accounts app.
- Possibility to delete active bank accounts
- two new buttons, to generate an IBAN from bank account information and to generate Bank Account Information from an IBAN
- Filters to select the bank accounts that you want to export.
- Unlimited Payment Approval indicator giving the right to approve all payments irrespective of the amount
- the new field Activation Sequence which helps to better identify bank account revision
- the new button”Save as Inactive” for Bank Account Creation. You must first use the new button Save as Inactive to save the bank account as an inactive version before you activate it or submit it for activation or approval.
- Sunsetting of Classic workflow – The classic workflow, the template 74300043, is no longer supported, only the flexible workflow, the template 78500050.
Technical bank accounts
You can now create technical banks and corresponding bank accounts, either via the Manage Bank Accounts FIORI app or SAP GUI transaction FITE (which is designated primarily for ECC systems, please refer to SAP Note 2964730 – Transaction for Technical Bank).
In the Manage Banks app, you can select Technical Bank as a new Internal bank category value. Once selected, the bank and the assigned bank account are considered to be technical.
Each technical bank can be linked only to a single bank account. Therefore, if you created banks with multiple „virtual“ bank accounts for this purpose in the past, you can use transaction FCLM_TECH_ACNT_MIG Split technical Bank accounts to identify and split these technical banks.
Bank correspondence – new email templates
With the Bank correspondence functionality which is available already since 1809, email or PDF correspondence letters can be automatically generated in Cash Management when a certain event occurs. In release 2020, in addition to already existing Email Notification Templates for Bank revision and Workflow, two new email templates and the respective CDS view have been shipped for managing bank accounts using the dual control mode.
- Bank Account Revision submitted for activation – once a bank account is submitted for activation, users who are authorized to activate bank accounts receive an email notification.
- Bank Account Revision Activated – With this email template, once a bank account is submitted for activation, users who are authorized to activate bank accounts receive an email notification.
You can customize the predefined email templates using the Maintain Email Templates app.
Bank fees management – validating bank service charges
Since SAP S/4HANA release 1809, the functionality of Bank Fees Management provides the cash manager with a comprehensive view of the services provided by banks and the charges paid to banks. You can import the BSB (bank service billing) ISO 20022 camt.086 format bank fee file into the system and leverage Monitor Bank Fees app to monitor bank charges
Starting from release 2020, you can compare the bank service volumes from the imported end-of-day bank statements with the service volumes from the bank services billing files to validate the service volumes and service charges using the Monitor Bank Fees app.
Authorization Objects Simplification
Several authorization objects have been made obsolete and replaced with the central object F_CLM_BAM and/or functionalities within the FIORI apps. For more details please refer to Authorization Object Simplification for Bank Account Management.
Situation Handling for Date Difference Warning for FI flows
In addition to the already existing situation templates
you can now use the situation template FIN_FQM_FIDATE_DIFFERENCE to inform specific users when the system detects an FI cash flow for which the difference between the posting date and the value date does not meet the defined conditions.
FIORI apps enhancements
Reconcile Cash Flows – Memo Records (since FPS1)
The new FIORI app Reconcile Cash Flows – Memo Records enables you to compare your end-of-day bank statements with your forecasted cashflows.
Cash Flow Analyzer
The Cash Flow analyzer app has been enhanced with the following features:
- the new button Display Cash Flow Items, which navigates you to a new list
page for the aggregated cash flows from various source applications, such as confirmed payments and bank
statements, and so on. I
- Cash flows can be searched and displayed by the local currency. The
- new Posting Date field is added in the Date Indicator field of the filter bar. Cash flows can be searched by the posting date or the value date.
Check Cash Flow Items
The Check Cash Flow Items app has been enhanced with the following features:
- new filters – exchange rate type, snapshot date and time, the source application description, and the Manually Adjusted indicator
- two separate fields for value date and posting date.
Cash Trade Request
- cash trade request for new financial instrument type Money Market: Fixed Term Deposit/Loan.
- partial fulfillment of trade requests
Manage Cash Concentration
The Manage Cash Concentration app has been enhanced to support:
- new button Specify Cash Pool, which guides you to enter a cash pool before you display bank accounts and view simulation results.
- New fields Plan Date, Value Date, and Reference Text.
Make Bank Transfers
The Make Bank Transfers app has been enhanced with:
- Application Log where you can see the history of bank transfers
- Possibility to specify payment instruction keys
Since SAP S/4HANA release 1909, the liquidity planning is built on top of the SAP Analytics Cloud application. What is new in 2020 is that you can now define different rate versions for exchange rates and view your liquidity figures in different rate versions.
New CDS views and APIs
A number of new CDS (Core Data Service) views have been released for Cash Management in S/4HANA 2020. For the list of new CDS views please see What’s new viewer. For details about individual CDS views, please see SAP help.
Application programming interfaces (APIs) are the new modern way how to communicate with external systems.
- Bank – Read ODATA based API to read bank data from your SAP S/4HANA system
- Cash Flow SOAP-based API to create cash flows through an API call from a source system outside SAP S/4HANA. Furthermore, the service enables you to create, update, delete, and erase existing cash flow data from the SAP S/4HANA system.
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