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Saturday, October 17, 2015

SAP S/4 HANA – Simple Finance: Simplified

SAP’s Financial & Controlling module (one of the core modules from SAP, since its R/2 days) is a pretty mature offering with awesome breadth and depth. But over the years, the world has changed a lot.  New financial regulations across the globe are necessitating change. There is also a need for lightning fast financials reporting.  The world of data is changing swiftly and financial operations must deal with enormous amounts of data processed at higher speeds and make sense of it.

Considering this and to leverage its high-performance HANA platform, SAP has taken its Financial & Controlling module to the next level by launching “Simple Finance” (short form- SFIN) with SAP Business suite 4 HANA (i.e. S/4 HANA) ). And while doing it, SAP not only overcame some of the short-comings (of traditional FICO module) but also packed it with some powerful new features.

The single source of truth

In Simple Finance, SAP has introduced a new table named ‘ACDOCA’ for the Universal Journal. It allows bringing data from General Ledger, Asset Accounting, Material Ledger, Controlling (Including coding block & CO-PA) into one journal. By this one master stroke, SAP has overcome the need of reconciliation (FI & CO), has overcome the need of settlement(All cost elements, including secondary cost elements are G/L accounts) & has done away with index tables /aggregate tables. 

§  Aggregate tables removed – GLT0, GLT3, FAGLFEXT, KNC1, LFC1,KNC3, KFC3, COSS, COSIP
§  Material Ledger - Contents of tables MLIT, MLPP, MLPPF, MLCR, MLCRF, MLCD, CKMI1, BSIM are now stored in ACDOCA. MLHD data is stored in 
§  Focus will be on Account-based CO-PA

o   The Journal Entry consists of a header (stored in table BKPF) & items (stored in table ACDOCA).  (Table BSEG continues for items. But it stores items coming from classical FI postings like FB01, FB50, FB60, FB70 etc.)     

(Please double-click on below image to see a bigger picture in a new window)

·         ACDOCA provides 6 digit field for document line item numbering & 23 characters for currency field. It provides multi-GAAP capability through “RLDNR” dimension (Ledger in GL accounting)

·         Profit Center Accounting (PCA), Sp. Purpose Ledger (FI-SL), & Consolidation (EC-CS) remain untouched & work as before. Components built with FI-SL technology like Joint Venture accounting & Public sector are untouched & work as before. Cost-based CO-PA works as before.

The ACDOCA design provides the highest level of granularity to users. It enables trial balance with many drill-downs & also provides multi-dimensional income statement.

Line item based analytics –
SFIN allows Processing and analysis of data based on line items rather than pre-configured totals, so that you can achieve the highest level of granularity available. Moreover, you do not have to set up aggregates before evaluating the data, which limits the type of analysis you can do and the speed of the analysis. With SAP HANA, you can perform your analysis quickly. This covers all the dimensions that you have in your line items.

Covering each and every topic of Simple Finance is not feasible, but in nutshell, it consists of following sub-modules:
·         General Ledger
·         Account Receivable
·         Accounts Payable
·         New Asset Accounting
·         Management accounting (including Material Ledger & Profitability Analysis)
·         Cash Management
·         Integrated Business Planning for Finance (IBPF)

User Experience -  
Fiori is SAP’s user experience paradigm. It allows role-based queries (with drill-down & slice-and-dice capabilities with graphical representation) on all devices (work-station, tab, mobile phones). Launch pad designer allows user personalization. SFIN comes with some ready-to-use queries which work without any configuration.  One can add more (customized) queries/tiles with minimal efforts.

Reporting capabilities -
Customers can use new dashboards based on Fiori layout options, SAP Smart Business Apps, SAP Analysis for Office and SAP HANA Live and new sFIN HANA Live content.
Depending on the requirements, reports can be built in HANA Studio, or also via the embedded BW. It depends on customer requirements for how much standard content should be (re-)used versus custom built.

Simple Finance users will experience much greater execution speeds, in some cases even as high as 1000x. It removes bottlenecks from closing process, eliminates time and efforts needed for reconciliation. The new architecture also eliminates data redundancy & thereby reducing the data foot-print drastically. The new user interface tools such as Fiori, Office Analysis Excel will revolutionize the user experience.  Instant improvement were observed in operational performances as well as closing processes which were seen to be 5X faster than before.

Simple Finance allows SAP customers to run trial Balance sheets, P&L's and Cash flow analysis any time of the day and any day of the quarter. The granular design enables trial balance with many drill-downs & also provides multi-dimensional income statement.

Organizations on SAP (with traditional SAP FICO module) can migrate to Simple Finance (SFIN 2.0) in following way –
Those who are on New GL can directly migrate to SFIN.
Those who are on classical GL, need to first migrate to New GL (bare-minimum functionality, no need to have document splitting or parallel ledger) & then move to SFIN.
This migration happens purely through SPRO & doesn’t need any technical (i.e. ABAP/4) help.

This migration is not to be confused with the one using “Central Finance component” (which helps in moving data from distributed ERP landscape and even from non-SAP ERP, using SLT – SAP Landscape Transformation)

Deployment options -
Currently, SFIN is available as SFIN 2.0 On-premise edition (1503) only. But as SAP is chalking out its Cloud strategy aggressively, it is only a matter of time before its availability in Cloud edition.

Important SAP Notes you may want to refer for more details -
·         SAP Note 2119188   Release scope including industry solution status
·         SAP Note 2103558   Availability/Compatibility of SAP add-ons
·         SAP Note 1946054 - SAP Simple Finance, on premise edition: Transaction codes and programs - Comparison to EHP7 for SAP ERP 6.0
·         SAP Note 2131643 - Replacement of SAP Simple Finance add-on 1.0 reporting content with SAP Simple Finance, on premise edition 1503

Conclusion –
SFIN offers absolutely great value, especially for those customers who are going directly for it as part of their SAP implementation (i.e. case of green-field implementation).
For customers who already are running on SAP, they should wait for a while. Author’s personal opinion is, SFIN needs some more time to stabilize (especially, its migration methodology). 


  1. Thanks for publishing well researched content ;-)

  2. Great article, precise summary...

  3. Excellent explanation at broader level. Appreciating you....

  4. I am very greatful to you that you share very informative post with us...
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  5. Thank you for valuable information on sap s4 hana finance.It has good information on SAP S4 HANA.It is the Best online training and remote access.More Details Follow link SAP S4 HANA simple

  6. Thank you for valuable information on sap s4 hana finance.It has good information on SAP S4 HANA.It is the Best online training and remote access.More Details Follow link SAP S4 HANA simple

  7. I'm so exited about the new possibilities with S/4HANA, especially for us as FICO consultants. Thanks for this blog!