With the FPS1 release of SAP S/4HANA 2020 a new scenario for central projects enables asset settlement in Central Finance. In my last blog post I have already explained the options of Asset Accounting in Central Finance. I have shown a scenario for central asset accounting with investment orders in source system. With the new central projects (WBS) – asset settlement scenario this process is now also available for WBS (work breakdown structure) elements.
This functionality is delivered with SAP S/4HANA 2020 FPS1. For SAP S/4HANA 2020 FPS0 you have to implement SAP note 2994285 to be able to use the new scenario. In this blog post I will now take a closer look at this new asset settlement scenario for central projects that enhances the existing reporting scenario for projects.
For an introduction into Central Finance, you can also start reading my blog post first: Different views on what is Central Finance, or you can also have a look into my previous article about Asset Accounting in Central Finance.
Central Projects (WBS) – Reporting Scenario
The first central project scenario with release of SAP S/4HANA 1709 FPS1 enabled a centralized reporting of projects from different source systems in a harmonized way in the central finance system. All projects and WBS elements are replicated to the central finance system via ALE as well as all FI and CO postings with WBS elements via SLT, so that all relevant costs and revenues are available in the Central Finance system. But it was not possible to do any operational processes on the WBS element like settlement in the central finance system. This scenario is shown in the following picture and you can find more details in SAP Help: Central Projects (WBS) – Reporting Scenario
The required set up in source system, AIF and Central Finance system is well documented in SAP Help and there is also a report available that checks settings for replication of projects:
- Configuration in Source System
- Configuration for SAP AIF
- Configuration in the Central Finance System
- Check Settings for Replication of Projects
TIP: The mapping of project IDs
If the project IDs and project coding masks are not already harmonized, the mapping of project and WBS element IDs and the definition of a project coding mask in the target system can be challenging. One simply solution would be to add a prefix for each source system. You can find a simplified example in the following table:
|Source system||Coding mask in source system||Coding mask in target system|
In this example in 2 source systems (A and B) the same coding masks are defined. Thus, the same project ID could exist in both source systems and you cannot use the same project ID in target system. In the Central Finance target system you could simply add a prefix for each source system to avoid conflicting numbers. Of course you can also implement your own logic.
To implement this or your own logic and to create new identifiers for the project ID and the IDs of the work breakdown structure (WBS) elements in the Central Finance target system you have to implement BAdI BADI_FINS_CFIN_PS of enhancement spot ES_FINS_CFIN_PS. You can find an example implementation in class CL_BADI_FINS_CFIN_PS_DEFAULT.
Central Projects (WBS) – Asset Settlement Scenario
The second central project scenario allows the settlement to assets as first operational processes on WBS elements in Central Finance. It is based on the reporting scenario and has been delivered with FPS1 in SAP S/4HANA 2020.
What are the highlights of the new Central Projects (WBS) – Asset Settlement Scenario?
- You can manage fixed assets and asset accounting in the central finance system without managing these fixed assets in the source system.
- In the source system you purchase using a cost object (WBS element) and settle it to a fixed asset in the central finance system.
- The asset under construction (AuC) is automatically created by mapping the project profile that doesn’t have a link to the AuC process in source system to a project profile that does have a link to the AuC process in the central finance system.
- Settlement of replicated WBS elements to fixed AuC or final fixed assets is enabled in the central finance system.
- Fixed asset depreciations are centralized in the central finance system.
- This scenario complements the replication of activity rates from central finance to the source system including their primary cost component structures (as fixed asset depreciations affect activity rates).
What are the Key Benefits?
- Reduction of costs by centralizing fixed asset accounting in central finance and switching off asset accounting in the source systems
- Take advantage of the capabilities of the latest asset accounting application in SAP S/4HANA
The following pictures gives an overview of the new central project scenario for central asset settlement. For details please refer to SAP Help: Central Projects (WBS) – Asset Settlement Scenario
I have highlighted the main process steps:
- First you create a project with WBS element in source with an investment profile that does not create an asset under construction (AuC) automatically. Therefor use or create an investment profile for which the Manage AuC checkbox is not selected. As this WBS settlement will be settled in central finance system and not in source system, assign a settlement profile for which the Not for settlement radio button is selected:
This will allow you to close the WBS element and the project in the source system even if there are still costs posted to it.
- Replicate the project (WBS element) in Central Finance by using the existing ALE scenario and map the project profile and/or investment profile. You can also use the same project profile and/or investment profile like in source, but in the investment profile the Manage AuC checkbox must be selected in Central Finance (details see SAP Help Control Functions of the Investment Profile):
IMG path: Financial Accounting -> Central Finance -> Central Finance: Target System Settings Central Projects -> Assign Project Profile to Company Code for Asset Settlement.
- The Central Projects – Asset Settlement scenario will be enabled from the next day onwards for the settings you make.
- Only projects which were created after this Customizing activity has been maintained can be used for the Central Projects – Asset Settlement scenario.
- If there are active projects or WBS elements using the Central Projects – Asset Settlement scenario, you cannot remove these entries from Customizing anymore.
- The system checks only the company code of the project header – and not the company code of the WBS element – to determine whether the Central Projects – Asset Settlement scenario is enabled.
Therefor the recommendation is to create new project profiles for the scenario and not reuse already existing ones and only set up projects within the same company code. Because the enablement is on project header level and WBS elements with a differing company code would also be included in the scenario and could cause issues, in case asset accounting is not set up in the Central Finance system for this company code.
- The asset under construction is automatically created for the WBS element in central finance system with the asset class defined in the investment profile.
- FI/CO postings and CO postings are created in source system on WBS elements.
- These FI/CO and CO documents from source system are replicated to Central Finance by the standard replication scenario and posted in Universal Journal to WBS element in target system.
- With the periodic settlement of WBS elements, costs are settled from WBS element to asset under construction in Central Finance.
- You create the final asset and maintain settlement rules in the central finance system. The settlement rule is restricted to only fixed assets (FXA) and profitability segments (PSG) as receivers.
- For the final capitalization you can settle costs from asset under construction to final asset in Central Finance (or to profitability segment). Afterwards all other asset related postings and reporting are done in Central Finance only.
- At the end the close status needs to be set first in the Central Finance system project, otherwise the change in the source system project is not possible. The deletion flag status can also be set in the Central Finance system. All other changes in the project are generally done in the source system with the mentioned exceptions.
Some of the existing constraints still exist: The WBS project structure only is replicated. Settlement rules and networks are not replicated. Therefore, you would need to first settle the network to a WBS element in source system. For more details, prerequisites and constraints please refer to the SAP Help and following SAP notes and links.
Important SAP notes and links:
SAP note 2994270 Central Projects – Asset Settlement: Activation in Source Systems
SAP note 2994285 Central Projects – Asset Settlement: Activation in Central Finance System:
- Correction instruction of this note is required for SAP S/4HANA 2020 FPS0.
- It contains also documentation of the new scenario in the attached PDF.
Finally, if not already done, make yourself familiar with the latest simplification list for changes in Project System in SAP S/4HANA and also check the compatibility scope for SAP S/4HANA:
- SAP Note 2269324 – Compatibility Scope Matrix for SAP S/4HANA
- SAP Note 2267286 – S4TWL – Project Reporting
The new Central Projects (WBS) – Asset Settlement Scenario enables one more central process in Central Finance and thus helps to take advantages of centralized processes in Central Finance. With the help of an investment project (WBS element) you can do asset related postings in source while doing the capitalization in the central finance system and keeping asset accounting in the central finance system only.
I hope this blog post was helpful for you!
Brought to you by the S/4HANA RIG