SAP S/4HANA Cloud for advanced financial closing: What is a good practice for the closing structure ?
The optimal design and setup of the financial close process is highly dependent on the customer’s size, industry, systems landscape, localizations, and organizational structures. Some AFC customers have a strong central team that takes over most of the closing workload, others have a rather distributed process, where each subsidiary is taking care of key closing steps on their own. Especially with large enterprises, it is quite common to have a split of the responsibilities between central shared services centers and local accounting teams. AFC efficiently supports all described scenarios and provides a flexible modeling approach to design the closing process as needed. In the following blog, I want to provide you with some good practices for using key concepts like Closing Hierarchy Types and Folders to model the closing structures in AFC so that you can make the most out of the features in the system.
Key questions you might ask:
- How can we avoid duplicate efforts during the creation of tasks in Closing Templates?
- How can we avoid duplicate efforts for processing users that are taking care of multiple Company Codes during the close?
- How can new Company Codes best be incorporated into an existing Closing Structure?
How the system works:
- Folders of type Company Code, Controlling Area or Plant are assigned to one or several organizational units of the respective type.
- Closing Tasks subordinate to such Org Unit Folders are parametrized accordingly.
- A Closing Task of type Job created below a Folder of type Company Code when scheduled is automatically executed for each company code assigned .
- The status set for a manually processed Closing Tasks of type Note, Web Application or Fiori App holds for each company code assigned.
What is a good practice:
The following measures can be taken, while setting up the closing structure with the Define Closing Tasks app and to gain more efficiency in the processing of Closing Tasks:
- Use folders of type Company Code (or CO Area or Plant) in your Closing Structure and assign the respective Organizational Units to these folders. Create any Closing Task relevant for the respective company codes (or other organizational units) below and subordinate to these folders. This leads to the following system behavior:
- When executing manual Closing Tasks of type Fiori App, Note or Web Application or during the scheduling Closing Tasks of type Job, the organizational context and the parametrization of these tasks is ensured without further manual selection.
- During status and completion reporting, the status of these Closing Tasks (regardless of whether the status is set manually or automatically) is displayed both collectively and individually for these company codes, their countries and country/region groups.
- Use one single Company Code-type folder per Entity if responsibility and ownership of Closing Tasks is different for each Company Code.
- Use a folder of type Company Code-type collectively for multiple entities if closing activities are performed centrally and duplicate manual processing of Closing Tasks for multiple Company Codes needs to be avoided.
- If some activities are performed centrally on region-level, others on country-level, while others are done per entity, do not hesitate to assign one and the same entity to multiple Company Code-type folders:
- Assign to the folder for the region collecting all Closing Tasks executed just once on region level,
- Assign to the folder for the country representing all activities to be done once per country.
- Assign to the one folder folder per entity just and only assigned to one single unit collecting all activities done separately and individually for each Company Code.
Good to know:
- When using folders of type Company Code, you can also grant read- or write-access to Closing Tasks by organizational assignments. See “How to Grant Access According to Organizational Units” in the Administration Guide.
- In generated task lists, a company code is technically represented by an SAP-managed parameter type. While under the current release Advanced Financial Closing does not provide a value help for parameter types in general, it does for organizational units such as company codes and plants.
- Closing Tasks of Type Jobs assigned to company code folders are scheduled individually for each company code assigned. In this way, AFC retrieves the status information and execution results automatically per company code.
- The hierarchy has no impact on and no meaning for monitoring and reporting. Monitoring and reporting is controlled by organizational assignments such as company code, CO area or plant, and by task attributes such as custom fields or processing user.
- You can familiarize yourself with the Define Closing Tasks app and the Process Closing Tasks app using the following videos:
- Define Closing Tasks
- Processing and Approving Tasks
For more information on SAP S/4HANA Cloud, check out the following links:
- SAP Community Page for Advanced Financial Closing: here
- SAP Help Portal for AFC: here
- AFC in the SAP Roadmap Explorer: here
- SAP.com page about AFC: here
Follow us via @SAP and #AdvancedFinancialClosing, or myself via Michel Loehden