Dear,
Since version 5 of Bank Analyzer was released 10 years ago, we've enjoyed a powerful system for the management of the Financial Instruments of an institution, from two perspectives.
- Multi-GAAP, Accounting representation of the financial events, impacting the Bank's portfolio (Bank Analyzer-AFI).
- Capital Consumption and correspondent Capital Requirements of the Bank's Assets (Bank Analyzer-Credit Risk).
This double representation is the foundation of the Integrated Financial Risk Architecture of Bank Analyzer, which was already available in previous versions of the system.
On the other hand, and that was the most relevant improvement of the version 5, the Accounting for Financial Instruments module of Bank Analyzer offered complete Financial Statements of every contract of the Bank, fully integrated and reconcilable with the General Ledger.
This integration was provided with the structure of a sub-ledger. In the AFI sub-ledger we have the detailed statement of every Financial Instrument/Transaction, fully reconcilable on account level, with the aggregated statement of the company, available in the General Ledger.
On the other hand, as the number of entries of the detailed sub-ledger, is far bigger than the aggregated entries of the General Ledger, the final architecture was called Fat-Subledger / Thin-General Ledger.
This was 10 years ago; on 2010 we saw the release of the SAP HANA Database whose performance opened new opportunities in Information Systems simplification, and since 2015 we can enjoy a new concept of Accounting Simplification with the Universal Journal of S4 HANA.
Amongst other advantages, the Universal Journal of S4 HANA has eliminated the separation between the sub-ledgers and the General Ledger.
With the Universal Ledger, the accounting information is not spread in the information system of the company.
We don't have to look for accounting aggregated information in the General Ledger and detailed accounting information in the Sub-ledgers (Accounts Payable, Accounts Receivable, Assets Management, Projects System, Real Estate, Material Ledger, etc.). With the Universal Journal, we have all the accounting information in a single multi-dimensional ledger, with separated but integrated entries, structured on the multiple dimensions of this ledger.
The simplified architecture of the Universal Ledger comes with new capabilities for analyzing and reconciling the accounting information.
For instance, let's imagine that we have to model the business process of a construction company, in which the invested capital is collected in the Projects System module, till the Work in Process is activated in an Asset, that will be managed by the Assets System module of SAP ECC. Finally, the asset will generate profits by lease out contracts, managed with the Real Estate Module.
Without the Universal Journal, accounting information for Projects needs to be recovered from the WBS's tables (PROJ, PRPS, etc.), while the accounting information of the Assets is stored in the Assets System tables (ANLA, ANLB, ANLC, ANEK, etc.), and the Lease Out contracts are stored in the Real Estate tables (VIMIMV, VIMI01, etc.).
With the Universal Journal, the accounting entries of the WBS elements, the Assets and the Lease Out contracts will be posted in the Universal Journal tables (ACDOCA, BKPF, etc) during all phases of the business process, simplifying the reporting and reconciliation requirements.
But let's come back to the Bank Analyzer system; theoretically SAP – AFI is not part of the S4 HANA simplification initiative, and consequently it will not offer the integrated capabilities of the Universal Journal.
Recently, we worked in a proof of concept for taking advantage of the Universal Journal capabilities, integrated with the Accounting for Financial Instruments module of Bank Analyzer version 9.
We'll talk about our conclusions in the next blog.
Looking forward to read your opinions.
Join the SAP Banking Group at: http://www.linkedin.com/e/gis/92860
K. Regards,
Ferran.
Since version 5 of Bank Analyzer was released 10 years ago, we've enjoyed a powerful system for the management of the Financial Instruments of an institution, from two perspectives.
- Multi-GAAP, Accounting representation of the financial events, impacting the Bank's portfolio (Bank Analyzer-AFI).
- Capital Consumption and correspondent Capital Requirements of the Bank's Assets (Bank Analyzer-Credit Risk).
This double representation is the foundation of the Integrated Financial Risk Architecture of Bank Analyzer, which was already available in previous versions of the system.
On the other hand, and that was the most relevant improvement of the version 5, the Accounting for Financial Instruments module of Bank Analyzer offered complete Financial Statements of every contract of the Bank, fully integrated and reconcilable with the General Ledger.
This integration was provided with the structure of a sub-ledger. In the AFI sub-ledger we have the detailed statement of every Financial Instrument/Transaction, fully reconcilable on account level, with the aggregated statement of the company, available in the General Ledger.
On the other hand, as the number of entries of the detailed sub-ledger, is far bigger than the aggregated entries of the General Ledger, the final architecture was called Fat-Subledger / Thin-General Ledger.
This was 10 years ago; on 2010 we saw the release of the SAP HANA Database whose performance opened new opportunities in Information Systems simplification, and since 2015 we can enjoy a new concept of Accounting Simplification with the Universal Journal of S4 HANA.
Amongst other advantages, the Universal Journal of S4 HANA has eliminated the separation between the sub-ledgers and the General Ledger.
With the Universal Ledger, the accounting information is not spread in the information system of the company.
We don't have to look for accounting aggregated information in the General Ledger and detailed accounting information in the Sub-ledgers (Accounts Payable, Accounts Receivable, Assets Management, Projects System, Real Estate, Material Ledger, etc.). With the Universal Journal, we have all the accounting information in a single multi-dimensional ledger, with separated but integrated entries, structured on the multiple dimensions of this ledger.
The simplified architecture of the Universal Ledger comes with new capabilities for analyzing and reconciling the accounting information.
For instance, let's imagine that we have to model the business process of a construction company, in which the invested capital is collected in the Projects System module, till the Work in Process is activated in an Asset, that will be managed by the Assets System module of SAP ECC. Finally, the asset will generate profits by lease out contracts, managed with the Real Estate Module.
Without the Universal Journal, accounting information for Projects needs to be recovered from the WBS's tables (PROJ, PRPS, etc.), while the accounting information of the Assets is stored in the Assets System tables (ANLA, ANLB, ANLC, ANEK, etc.), and the Lease Out contracts are stored in the Real Estate tables (VIMIMV, VIMI01, etc.).
With the Universal Journal, the accounting entries of the WBS elements, the Assets and the Lease Out contracts will be posted in the Universal Journal tables (ACDOCA, BKPF, etc) during all phases of the business process, simplifying the reporting and reconciliation requirements.
But let's come back to the Bank Analyzer system; theoretically SAP – AFI is not part of the S4 HANA simplification initiative, and consequently it will not offer the integrated capabilities of the Universal Journal.
Recently, we worked in a proof of concept for taking advantage of the Universal Journal capabilities, integrated with the Accounting for Financial Instruments module of Bank Analyzer version 9.
We'll talk about our conclusions in the next blog.
Looking forward to read your opinions.
Join the SAP Banking Group at: http://www.linkedin.com/e/gis/92860
K. Regards,
Ferran.
1 comment:
Hi Fara,
I have a customer that is live on ECC on Db2, and BA 9 on Db2. They have been live for 6 years. Their current ECC system doesn't satisfy the CFO office requirements & they use the subledger in BA to manage the business, they have SAP BW to integrate, BA, BS, PA, CRM & ECC. They are looking at their HANA roadmap initiative. our instinct is that they should upgrade to s4 first and establish a modern enterprise organisation and then upgrade BA 10 on HANA in a after they are IFRS 9 compliant, and eventually eliminate BW all together with a Enterprise HANA box for non sap & sap data. the rest will run with virtual views. The CFO office isnt convinced in the value of the S4 financial transformation because they run the business out of the sub-ledger in AFI.
If I understand you correctly, the sub-ledger concept will no longer be there in BA 10 (BS9), and they will have to have the S4 unified journal concept in place inorder to run the business in a BA10 (Bs9) world.
Is that correct? what would your initial recommendation be?
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