What is S/4HANA 1610???
- HANA (High performance ANalytics Appliance) was introduced as in-memory computing database in 2011.
- SAP BW was powered on HANA Database making analytical reporting real-time and no need for running the extractors overnight, no more latency in 2012
- SAP Business suite powered by SAP HANA and cloud services introduced in 2013
- Simple Finance as a frontrunner was released with simplified database structures, much faster reporting, single source of truth & no aggregates in 2014
- In late 2015, S4 HANA 1511 was released with simplified data models across the landscape, extremely friendly Ux, advanced processing and choice of deployment: Public Cloud, On-Premise or Hybrid Cloud
As you can see in the figure below, S/4 HANA Finance is a different product that S/4HANA (Enterprise Management).
Except for some minor differences which are listed below. This make things a bit easier to understand later on :).
S/4HANA 1610 FINANCE – Key differences and innovations
Now we have to understand the product. Let’s look at the benefits of S/4HANA for our organization & key differences compared to classic FICO in R3 including some features which were already included in Simple Finance 1.0 back in 2014.
Before and after S4 HANA The Principle of simplified and One
Diagram source :www.sap.com
- Simple Data Model
Only mail table exists now no redundancies
Clear separation of Master data from transactional data
Reduction of Memory footprint
- Principal of “ONE”
Only one evaluation method(Material Ledger)
Instead of 2(IM + ML)
Flexible rebate Management instead of cumbersome and expensive redundancies
- Throughput Increase
INSERT command available only on data base level (MM-IM)
No locks for standard price valuation
- Master Data: Business partner is now capable of centrally manage data for customers and vendors. BP is now the single point of entry to create, edit and display master data.
- ProductTable T130F (Table of Field attributes) does have delivery class E (E = Control table, SAP and customer have separate key areas). In SAP Business Suite the delivery class of table T130F is G (G= Customizing table, protected against SAP Update, only INS all).
- Material Number field length: With SAP S/4HANA, on premise edition 1511, the maximum field length of the material number is extended from 18 to 40 characters.
- Simplification The field KZEFF in table MARA is not available anymore. The current setting KZEFF is such that the field will be hidden only from the UI, but still continue to be available in the database. However, Assign effectivity parameter values/ override change numbers (KZEFF) impacts the parameter effectivity in BOM explosion by providing a popup to manually overwrite validity parameters.
- The user interface for SAP S/4HANA, on premise edition 1511 is transaction BP.
- The specific transactions like XD01, XD02, XD03 or VD01, VD02, VD03 / XK01, XK02, XK03 or MK01, MK02, MK03 etc. are not available in SAP S/4HANA on premise edition 1511
- Currently mass maintenance for customers and vendors via transaction MASS is not available (on the roadmap of a future SAP S/4HANA release)
Hence, the value of this field needs to be reset from X to space. This ensures similar behavior in UI & in the backend.
- The Foreign Trade functionality as part of Sales & Distribution is not available within SAP S/4HANA. The functional equivalent in SAP S/4 HANA is SAP Global Trade Services (GTS). The below mentioned fields for Letter of Credit/ Legal control/ Export control/ Preference management in Foreign Trade is supported by GTS and not through Material Master:
- CAP product list no.
- CAP prod. Group
- Preference status
- Vendor decl. status
- Exemption Certificate
- Exemption Cert. No.
- Iss.date of ex.cert.
- Military goods
- MRP fields in Material Master
The SAP S/4HANA simplification is done on the following tabs in transaction MM01/02/03.
Lot Size data in MRP1 Tab: unit of measure group is considered in only retail henceforth it is not
required to switch it on in the material master.
- Unit of Measure Group
Procurement in MRP2: MRP considers quota arrangements always, henceforth it is not required to
switch it on in the material master.
- Quota arr. usage.
BOM explosion /dependent Requirement tab in MRP4
- Selection Method
Repetitive manufacturing /assembly /deployment strategy tab of MRP4
- Action control
- fair share rule
- push distribution
- Deployment horizon.
Storage Location in MRP4
- SLoc MRP indicator
- spec.proc.type SLoc
- Reoder Point
- Replenishment qty.
Also the backend database fields for these “omitted functionality” remains existing in the system
- Material type “SERV” for services is introduced for Product Master in S/4HANA for simplification purposes. When you use material type SERV, some fields and departments that are irrelevant in S/4 are hidden from the screen. This gives all transactions relevant for material master, a leaner and simplified look.
- Business Partner IDOC Types (DEBMAS and CREMAS): The business partner related iDoc message types – DEBMAS and CREMAS are not available with Sap S/4HANA, on-premise edition 1511. They are planned to be available in a future release of SAP S/4HANA, on-premise edition.
If you try to transfer data using these message types in S/4HANA, data would be transferred without actually having created a business partner
- SD Data Model:
- Elimination of Status Tables VBUK, VBUP: Status fields have been moved to the corresponding header and item tables – VBAK and VBAP for sales documents, LIKP, and LIPS for deliveries, VBRK for billing documents
- Simplification of Document Flow table VBFA.
- Field length extension of SD document category: Data element VBTYP (Char1) has been replaced by data element VBTYPL (Char4), also: elimination of field VBTYP_EXT (Char4)
- Elimination of redundancies – Document Index Tables VAKPA , VAPMA, VLKPA, VLPMA, VRKPA, VRPMA
- Elimination of redundancies – Rebate Index Table VBOX: see simplification item SD Rebate Optimization
Key benefits of the data model changes:
- Reduced memory footprint (simplified Document Flow, elimination of index tables, fewer aggregates)
- Increased performance of HANA queries and code pushdown (one select statement instead of two select statements, easier join for header/items including status and business data)
- Increased robustness of Rebate processing (no redundancies due to aggregates)
- Data Model Changes in SD Pricing
Business documents within the SAP Business Suite such as the sales order or the purchase order used
to store the pricing result in the database table KONV. In SAP S/4HANA, table KONV was replaced in
its data persistency role by the new table PRCD_ELEMENTS. However, KONV is and can still be used for
data declaration purposes. It still defines the structure of the pricing result within the application coding. The content of KONV is transferred to PRCD_ELEMENTS when moving to SAP S/4HANA.
Several other DDIC changes have been done in pricing condition table. Please refer the SAP paper for more details.
|Type of Change
|Access Sequence – Access Number
|Field is obsolete. Possible field content will be
merged with content of KOLNR and moved
|Level (in multi-level BOM explosions)
|Field is obsolete and will not be transferred to
|Path (for multi-level BOM explosions)
|Field is obsolete and will not be transferred to
- Billing Document Output Management
With SAP S/4HANA a new Output Management approach is in place
- The complete configuration differs from the configuration that is used when output
management is based on NAST. The configuration is based on BRF+ which is accessible for Customers.
- Output management based on NAST is not available for new documents in SD Billing. Billing documents that
are migrated from legacy systems and for which NAST based output has been determined, can be processed
with this technology.
- In application Billing it is recommended to use Adobe Forms but also Smartforms and SapScripts are supported
- In contrast to the output management based on NAST the new output management supports only the
Channels PRINT, EMAIL, XML and IDOC (for on premise). Other channels are not available by default.
- The FI-AR-CR Credit Management
- SD Rebate Processing replaced by Settlement Management: In general, SD Rebate Processing is not available within SAP S/4HANA. The functional equivalent in SAP S/4 HANA is SD Rebate Processing is Settlement Management.
- SAP SRM: The functional scope of SAP supplier relationship management will gradually be made available with S/4 HANA a limited functional scope is now available as compared to SAP SRM. The coverage is proposed to grow overtime and procurement solution will evolve to take over SRM functions.
- SAP Supplier Lifecycle Management: The goal is that – over time – the functional scope of SAP Supplier Lifecycle Management (SAP SLC) will be available within the SAP S/4HANA stack.
- MM-Inventory management data Model:
- Material Ledger Obligatory for Material Valuation: This simplification makes it obligatory to use the Material Ledger in all SAP S/4HANA systems. When a system is converted to SAP S/4HANA the Material Ledger will be activated if not active already. Please take a note that though material ledger will be active for parallel valuation of inventory and other purposes it is not mandatory to activate/use actual costing.
In MM02 and MR21 material prices can now be maintained in multiple currencies. In Financials the inventory account balances are calculated separately for each currency and result therefore in a cleaner and more consistent valuation in other currencies than the local currency.
- Sales & Operations Planning (SOP) will be replaced by Integrated Business Planning IBP12. Integrated Business Planning supports all SOP features plus advanced statistical forecasting, multi-level supply planning, an optimizer, collaboration tools, an Excel-based UI, and Web-based UIs.
There is a complete list of t-codes and programs that are impacted after migrating to S4 HANA Finance. Most important that we focused on were as below:
|Vendor Line Item Browser
|G/L Account Line Item Browser
|Customer Line Item Browser
|G/L Account Line Item Browser (G/L View)
|Foreign Currency Valuation
|Display Actual Line Items for Cost Centers
|Actual Settlement: Production/ Process Orders
|Calculate Work in Process: Collective Processing
|Mass Schedule Maintenance Plans
* t-code remains same, options changed
|Create asset transaction
|Asset Sales Without Customer
|Asset Retirement By Scrapping
|Transfer From Initial Screen
|Acquisition From In-House Production
|Asset Acquisition Autom. Offset.Posting
|Acquisition From Affiliated Company
One Single Source of truth and all accounts become GL accounts
All actual line items will be stored in the new table ACDOCA. There will be no redundant, aggregate or total tables anymore. All dimensions of GL, CO, COPA, AA and ML will be in ACDOCA.
In the ACDOCA whe have multidemsional GL, parallel ledgers, parallel currencies, 999,999 line items and custom defined fields. The chalenges of gathering combined content of several tables to represents the truth and reconcile the different level of detail stored in the different components/tables of SAP (e.g. CO= much detail, Fi= less detail) is now somehting of the past.
The reason of the merge of secondary and primary cost elements is the fact that all actual line items will now be stored in one single table. The ACDOCA. This also applies on purely (internal) CO postings. You should not include these secondary accounts in your P&L.
Parallel currencies and parallel valuation
In S/4HANA 1610 we can now have up to 10 parallel currencies per ledger. Real-time conversion for all currency types is possible, Zero balance per document is guaranteed for each currency and CO-area currency is now calculated for all accounts (also non cost element).
Parallel valuation functionality is significantly enhanced in S/4HANA 1610. SAP now provides two options to store multiple valuations:
- Parallel valuation updated in parallel single-valuation ledger
- Separate ledger for each valuation
- Transparent separation of posting and reporting based on different regulations
- Parallel valuation updated in multi-valuation ledger
- Separate amount columns in the same ledger
- Reduce memory footprint
- Reduce effort and time for closing
See an example of the 2 methods below.
Profitability Analysis in S/4HANA 1610
With S/4HANA SAP focuses on the enhancement and integration of Account based COPA. This is the preferred type of Profitability Analysis. Costing Based profitability analysis is still available and can be used in parallel, but there will be no integration with the Universal Journal (ACDOCA table).
Below you will find the list of enhancements on Account Based profitability analysis. Critical gaps of the past are closed.
- Split of Cost of Goods Sold on multiple accounts based on cost component split. This is done during posting of the Goods issue.
- Split of production variances on multiple accounts. This is done at order settlement.
- 3 new quantity fields provided in the line items and a BAdI for conversion of the logistical quantities to common quantities in Finance.
- Real-Time derivation of market segment information from cost postings (Cost Center, order etc.)
Summary of the enhancement:
Unfortunately there are still some limitations which are on the future roadmap. Current limitations of Account Based profitability analysis:
- Sales conditions which are not posting to GL (statistical) are not supported
- Realignment of characteristics which are changed after posting are partially supported. Not for all characteristics!
- Creation of sales order generates expected revenue, COGS etc. in profitability analysis is not supported.
Attributed Profitability Segments
In my opinion, this is one of the greatest enhancements in Profitability Analysis. I was always thinking why this was not possible in SAP and now it is here! With a couple of additional configuration steps the ‘Attributed PA segment’ can be activated.
Another good example is when you have a debit memo request in a Time & Material Service order which has a settlement rule for settlement to COPA. The debit memo request will have an account assignment to the service order and no profitability segment. That means that you do not have the profitability segment information until the service order is settled to COPA. With this new functionality you can have the real account assignment to the service order and an attributed assignment to a profitability segment. Great stuff!
Event based revenue recognition
The revenue recognition process is now fully integrated with the Universal Journal. There is no separate storage for Revenue Recognition data anymore.
Cost and revenues are recognized as they occur. The entry of the source document will generate two postings. An entry for the initial costs and revenue and an entry for the revenue recognition posting.
There is even a new app ‘Event based revenue recognition’ for monitoring of revenue recognition postings and manual adjustments.
Bank Account Management (lite)
In the ‘old’ setup there were house banks and bank accounts in SAP. In S/4HANA basic functions of the Bank Account Management functionality of Cash Management is brought in to the core. This is called Bank Account Management Lite.
The main new features and differences compared to the old house bank and bank account setup are the following:
- Group-wised account management
- Overdraft Limit
- Opening and Closing with approval process
- Easily maintain bank accounts
To highlight the latest point. Bank accounts are now part of master data and can be maintained by users through a dedicated Web Dynpro or Fiori application. The house banks itself are still created in customizing. Transaction FI12 is obsolete and the new transaction FI12_HBANK is introduced for this purpose.
So the process of creating the house bank and the house bank account are separated and executed in two different places.
New Asset Accounting
Migrating to New Asset Accounting is a pre-requisite for migration to S/4HANA (Finance). The reason and motivation behind New Asset Accounting is:
- No data redundancy
- Reconciliation between GL and AA ensured
- Transparent assignment of depreciation area to accounting principle
- Simplified chart of depreciation: only 1 CoD per valuation
- No delta depreciation areas
- Asset balance in real-time (APC posting run not needed)
- Plan values in real-time
Usage of the New Depreciation Calculation Engine is mandatory and the tables ANEA, ANEP, ANEK, ANLC, and ANLP are not updated anymore in New Asset Accounting.
New Asset Accounting is not really new. It has been available since SAP ECC enhancement pack 6. However, lately it has gained attention because it is a mandatory step to activate New Asset Accounting in the S4HANA Finance or S4HANA migration. It is mandatory. One good thing about it is that it provides an opportunity to be proactive. If you are already on New GL, you could start going through the pre-requisites, pre-checks and even head start activating New Asset Accounting project before your S4HANA migration project.
Though in our recent S4HANA Finance 1605 project we did not come across any serious issues, few consultants I talked to face some challenges that could turn into prove a bottleneck and slow down the progress. It is not only because of the complexity but also large impact of asset accounting on business. I am hereby trying to connect few dots that would bring clarity.
The program RASFIN_MIGR_PRECHECK checks if the migration pre-requisite is complete. Also the business function (Enterprise extension) EA-FIN and FIN_AA_CI_1 (for parallel accounting) are activated. Refer to the SAP Note 1939592 and also Note 965032 for more details.
Pre-Check if the New Asset Accounting
Check if the New Depreciation Engine is Active once business extensions activated.
Let us now start with the functional benefits of New Asset Accounting when you migrate to S4HANA Finance and then discuss on changes in the architecture, configuration options, new posting logic, new t-codes and (positive) impact on the closing process. I will also discuss on some specific errors we came across in our recent S4HANA Fin 1605 migration project and the resolution.
Impact on Functionality
- Reconciliation between FI and AA is not required
- Depreciation values posted in Real time – efficient and faster depreciation run.
- Depreciation posted for the individual asset
- Depreciation posting run, detailed log option provides information on individual assets level along with cost centers.
- Clean and transparent assignment of depreciation areas to the Accounting Principle.
- APC ( Acquisition and Production Costs) posting run are not required – Closing
- Balance carryforward is not required by design and FAGLGVTR takes care of balance carry forward for all sub ledger accounts including Asset Accounting – Closing
- Planned values are updated online with master data and transaction to assets – Closing
- No need of the delta areas as separate single valuation area per valuation
- Since the Asset Accounting is a part of universal journal there are many opportunities combining GL and Asset Accounting example drill down by cost center or asset from one place.
- Accounting Principle and depreciation area can be entered in the Document posting
- Optional display of Asset view of journal entries
- Period Close is possible even if there are errors on assets ( No blocking for the process) – Closing
- Classic Asset Accounting is no more supported
- All actual line items are posted to the Universal Journal Entry – ACDOCA table. Tables ANEK, ANEP, ANLC, ANLP are hence redundant but reporting is possible due to compatibility views. You still can run reports for earlier periods before migration.
- The plan and statistical data is stored in separate tables FAAT_DOC_IT ( statistical), FAAT_PLAN_VALUES (Planned) and FAAT_YDDA (year dependent
The integrated acquisition of an asset is split in to two parts – an operational ( Vendor Invoice – Debit Technical Clearing Account to Vendor. In the second part, valuation part ledger group specific document is posted to each of the accounting principle.
Customizing / Configuration
The IMG path covers step by step customizing / configuration of the new Asset Accounting
I am covering only few of the important customizing / configuration steps to build our understand
- Migration of Chart of Depreciation. There is a migration program FAA_CHECK_MIG2SFIN but it is recommended to it manually.
- Assign Accounting Principles and Ledger Groups to the depreciation are.
- Make sure that for each currency type a separate Depreciation area is assigned
GL currency config in parallel accounting
|Company Code Currency
|Company Code Currency
Depreciation Area Config
|Name od Dep Area
|Posting to GL
|Book Depreciation (Co Code)
|Posting to GL
|Consolidated B/S (Group)
|Area Does not post
|Adj Current Earning
|Area Does not Post
|Company Code – Val 2
|Area Post in Real time
|Group – Val 2
|Area Does not post
- Refer to SAP Note 2180591. This note is to address issues with parallel valuation / currencies but useful in clear understanding of the new architecture and configuration requirements.
- Additionally, if you are using the Accounting approach, for parallel valuation, define the hen G/L accounts as reconciliation accounts
- We need to create a Technical Clearing Account for Integrated Asset Acquisition.
- Following are manual activates needs to be completed depending on the scenario
List of Obsolete t-codes and new t-codes
|Periodic APC Run
|Last Retirement on Group Asset
|Asset Sale Without Customer
|Asset Retirement by Scrapping
|Balance sheet revaluation
|Adjustment Posting to Areas
|Credit Memo in Year after Invoice
|Credit Memo in Year of invoice
|Manual transfer of reserves
|Acquisition from in-house production
|Asset acquis. autom. offset. posting
|Acquisition from affiliated company
Changes in loading of Asset Master – Transaction AS91
The process is changed after migrating to New Asset Accounting. The transaction AS91 still exists but to load the historical values, accumulated depreciation and depreciation costs for the year are loaded through ABLDT. The current year acquisition managed through AB01L
- Reversal for the documents posted prior to migration ( prior to activation of new posting logic) is not possible.
- Transaction types that are specific to depreciation area cannot be used and required to be marked as obsolete
Errors in Migration
We came across a few errors in migration – one of them being “Mismatched Balance for ANLC”. It was corrected thru an SAP Note 2155523
An example of the new posting logic during integrated asset acquisition with two ledger with two different accounting principles:
As you can see a new ‘technical clearing account’ is used to post accounting principle specific documents. The balance of the technical clearing account is zero.
Embedded Analytics and Reporting
SAP blends transactions and analytics in one system allowing operational reporting on live transactional data.
I can talk hours about reporting in S/4HANA. With the new data structure (e.g. ACDOCA), all the pre-delivered Virtual Data Models (VDM’s), the performance of HANA and the modern and state of the art reporting tools/interfaces, there are so many new possibilities.
The concept of embedded analytics in S/4HANA is to provide pre-defined models across the entire suite in which the business logic is embedded. So the provided data models are delivering contextual information rather than raw data.
Let us start with the most commonly used t-code FAGLL03H – G/L Account Line Item Browser (G/L View) that could set up a theme and most of the rest new t-codes become more intuitive to understand.
Please note that the old t-code FAGLL03 still works. The h-version FAGLL03H is optimized for HANA and also provides very interesting and useful, additional features for reporting and analyzing the reports.
The line item browser displays the line items that have been posted in General Ledger Accounting, and also the line items that have arisen through document splitting. The new t-code provides selection from hundreds of fields like COPA, Material Master, Customer. The new t-code also provides additional functionality as on the fly aggregates and pivot model on top of transactions detail. The output is more structured and easy to use.
Run t-code FAGLL03H
With Change Layout Option several fields that were not available earlier could be added and saved as a new Layout.
Click on the the Arrow to expand other functions.
Select line you want to get the line item report. Click on right bottom corner of button and select ‘Call Line Item Report’ from the pull down menu.
G/L Account Line Item Display
Green Arrow Back to go back to G/L Account Line Item Browser
In a nutshell, I can say that the following reporting tools are mostly used at my customers where I did S/4HANA implementations:
- Analysis for Office
- SAP Lumira
Each tool has its own purpose of course. I can say that with out of the box analytical Fiori apps and the KPI Modeler in SAP Smart Business together with the Analytical Path Framework already provides a lot of content and satisfies a lot of customers.
Some examples of Smart Business cockpit and the Analytical Path Framework apps.
Next to these type of apps, SAP provided multi-dimensional reporting apps. For example the Market Segment Actuals app in which I can report on my P&L with in addition my Profitability Analysis characteristics.
For more flexibility the products from the BO suite (additional license) Analysis for Office and Lumira can be used.
Benefits to Organization:
- Financial soft close ( simulation) on the fly, reduced FTE for reconciliation and reporting
- Planning and predictive finance: allows companies to predict inbound and outbound cash flows and risk management
- S&OP will enable sales and marketing department to collaborate with operations and finance in order to evaluate the impact of their strategies and make accurate predictions
- With Live MRP, planners are able to plan to the lot size of 1 making it very customizable resulting in higher customer satisfaction and retention
- Real-time & advanced ATP, interactive back order processing
- With the agility, simplicity S4H offers Users & businesses can re-imagine, re-engineer their business processes
- Role-based screens rather than having to go all the screens relevant or irrelevant
- Can focus on strategic tasks than admin tasks
- Faster reports, analytics will help users in decision making process
- Reduced TCO in terms of data footprint, maintenance, number of servers