Dear,
As organizations have to operate in multiple jurisdictions and industries, it becomes critical improving a common language for communicating with their counter-parties.
Financial Planning, Reporting, Disclosure and Consolidation is the backbone of this communication language, and of the main pillars of the companies information systems.
Historically, companies prepared their Financial Statements in Flat-Structures with multiple number of GL-Accounts representing both, the economic nature of the accounting event and the analytical position where the accounting event was happening.
As companies became more complex and regulatory requirements more demanding, the growing number of analytical dimensions/positions and economic event types ended in huge chart of accounts with thousands of GL-Accounts.
For making it worse, Financial Statements structure are different amongst affiliates of the same group making consolidation a very complicated puzzle to assemble.
SAP brought a solution to the problem with the delivery of the Flexible General Ledger (with some limitations) and the Universal Journal of S4 HANA. With them, SAP provided the concept of Multi-Dimensional Ledger where the analytical positions are represented by its own dimensions combination in the coding block, and only the economic nature of the accounting event is represented by the GL-Account.
This technology opened the gate for the harmonization and simplification of the Chart of Accounts of the affiliates of a companies group, facilitating significantly the production of homogeneous Financial Statements and their reconciliation and consolidation.
With the embedded version of Business Planning and Consolidation in the Universal Journal of S4 HANA SAP provided a powerful Real Time Consolidation platform, taking advantage on the deep integration between SAP S/4HANA and the Planning and Consolidation functionalities of SAP BPC.
The Universal Journal integrates the Accounting Information in the ACDOCA table, facilitating SAP BPC direct access to the Journal Entries of the company affiliates as they are posted, so the rule based consolidation engine of SAP BPC can deliver the consolidation entries in Real Time.
SAP S/4HANA Finance for group reporting includes a complete of set of financial consolidation capabilities, supporting currency translation, inter-unit eliminations, data validation and analysis reports for company and group scope in real time.
Finally, SAP Group Reporting provides seamless integration with Cloud Analytics for central reporting and visualization of consolidated and non-consolidated financial information.
On the other hand, SAP has not delivered yet a complete solution for Solvency and Fair Value Accounting Planning, including collaterals revaluation, commitments postings, Valuet at Risk Analysis, etc.
We do have Solvency Stress-Testing Analysis in the Credit Risk Module of SAP Banking Services Analytical Banking and some new Forecasting, Planning, and Simulation capabilities in SAP Financial Products Subledger.
We also can take advantage of the Accounting and Risk Integration Capabilities of the SAP Integrated Financial and Risk Architecture, but the Planning Capabilities are still far from these available for Accounting.
Looking forward to read your opinions.
K. Regards,
Ferran.
www.capitency.com
Join the SAP Banking Group at: https://www.linkedin.com/groups/92860
Visit my SAP Banking Blog at: http://sapbank.blogspot.com/
Let's connect on Twitter: @FerranFrancesGi
Ferran.frances@capitency.com
As organizations have to operate in multiple jurisdictions and industries, it becomes critical improving a common language for communicating with their counter-parties.
Financial Planning, Reporting, Disclosure and Consolidation is the backbone of this communication language, and of the main pillars of the companies information systems.
Historically, companies prepared their Financial Statements in Flat-Structures with multiple number of GL-Accounts representing both, the economic nature of the accounting event and the analytical position where the accounting event was happening.
As companies became more complex and regulatory requirements more demanding, the growing number of analytical dimensions/positions and economic event types ended in huge chart of accounts with thousands of GL-Accounts.
For making it worse, Financial Statements structure are different amongst affiliates of the same group making consolidation a very complicated puzzle to assemble.
SAP brought a solution to the problem with the delivery of the Flexible General Ledger (with some limitations) and the Universal Journal of S4 HANA. With them, SAP provided the concept of Multi-Dimensional Ledger where the analytical positions are represented by its own dimensions combination in the coding block, and only the economic nature of the accounting event is represented by the GL-Account.
This technology opened the gate for the harmonization and simplification of the Chart of Accounts of the affiliates of a companies group, facilitating significantly the production of homogeneous Financial Statements and their reconciliation and consolidation.
With the embedded version of Business Planning and Consolidation in the Universal Journal of S4 HANA SAP provided a powerful Real Time Consolidation platform, taking advantage on the deep integration between SAP S/4HANA and the Planning and Consolidation functionalities of SAP BPC.
The Universal Journal integrates the Accounting Information in the ACDOCA table, facilitating SAP BPC direct access to the Journal Entries of the company affiliates as they are posted, so the rule based consolidation engine of SAP BPC can deliver the consolidation entries in Real Time.
SAP S/4HANA Finance for group reporting includes a complete of set of financial consolidation capabilities, supporting currency translation, inter-unit eliminations, data validation and analysis reports for company and group scope in real time.
Finally, SAP Group Reporting provides seamless integration with Cloud Analytics for central reporting and visualization of consolidated and non-consolidated financial information.
On the other hand, SAP has not delivered yet a complete solution for Solvency and Fair Value Accounting Planning, including collaterals revaluation, commitments postings, Valuet at Risk Analysis, etc.
We do have Solvency Stress-Testing Analysis in the Credit Risk Module of SAP Banking Services Analytical Banking and some new Forecasting, Planning, and Simulation capabilities in SAP Financial Products Subledger.
We also can take advantage of the Accounting and Risk Integration Capabilities of the SAP Integrated Financial and Risk Architecture, but the Planning Capabilities are still far from these available for Accounting.
Looking forward to read your opinions.
K. Regards,
Ferran.
www.capitency.com
Join the SAP Banking Group at: https://www.linkedin.com/groups/92860
Visit my SAP Banking Blog at: http://sapbank.blogspot.com/
Let's connect on Twitter: @FerranFrancesGi
Ferran.frances@capitency.com
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