Cash Management in SAP S/4HANA Finance takes care of the cash movements in business. It ensures on-time availability of funds for financial requirements and payment obligations and maintains accurate liquidity in the business.

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Cash Management in SAP S/4HANA Finance – Detailed Overview
Published by Pradeep on August 8, 2020
What is SAP Cash Management?
Cash Management in SAP S/4HANA Finance takes care of the cash movements in business. It ensures on-time
availability of funds for financial requirements and payment obligations and maintains accurate liquidity in the
business.
What is for you in this article?
In this blog, we will discuss an overview of what Cash Management in SAP S/4 HANA is. How it has emerged over time from
ECC to S/4HANA. You would further learn its Key Components and understand their role individually in the development
process.
Conclusively, by the end, you would get an idea of what exactly to expect when you get started and implement SAP S/4 HANA
Cash Management solution.
So let us get started.
Key Component in SAP Cash Management
The next-generation SAP Cash Management product provides the following three components:
1. Bank Account Management
2. Cash Flow Management (Cash Operations)
3. SAP Liquidity Management (Liquidity Planner)

2. An Overview
Cash Management in SAP S/4HANA
With SAP S/4 HANA, the classic SAP cash and liquidity management have been replaced by the new SAP Cash
Management. So, if you are using the classic SAP cash and Liquidity management, you can migrate the related master data
to the new SAP cash Management.
Though Cash Management in SAP is not a new concept. It was there in ECC also. However, in S/4HANA, it is more
advanced, compact and user-friendly.
The Comparison
Classic Cash Management Vs. New Cash Management
Classic Cash Management in ECC
The previous functionalities and modules that were known as SAP Cash and Liquidity Management are referred as Classic
Cash Management now.
It is consist of Classic Cash Position report ( FF7A) and classic Liquidity Forecast report (FF7B) as well as classic Liquidity
Planner with all its transaction codes, programs and reports.
New Cash Management in S/4HANA
Classic Cash Management has been completely replaced by the new Cash Management in S/4 HANA. However, in the
backend, classic Cash management settings with regard to planning levels and planning groups are still in place. Even, also
the liquidity planner still exists.
Key Components
Now, We will start knowing the key components of Cash Management in SAP S4 HANA Finance.
1. Bank Account Management
With Cash Management in SAP S/4 HANA, the entire management of bank data has completely changed. Previous functions
for maintaining bank and bank account data are no longer valid. Additionally, you must activate at least the basic scope of
Bank Account Management (BAM Lite) to create and maintain bank accounts and banks.
Consequently, no SAP customer can migrate to or implement SAP S/4 HANA without also at least implementing a portion of
BAM.
Where the Bank Account Management required?
Bank accounts are the core of all operations involving cash. We use it in almost all the departments in the business.
Treasury/Cash Department- Bank accounts needed in the treasury department to make treasury payments and to manage
cash. Therefore, bank accounts can be considered core assets of cash or treasury department.
Bank accounts are owned and controlled centrally by the group cash or treasury department.

3. AR/AP and Payroll Departments- Not only are bank accounts used by Treasury or the cash management department, but
you also need bank account across the entire organization from accounts payable and accounts receivables to payroll.
You may read: AR/AP Interview Questions in SAP FICO
Bank Account Management in SAP Cash Management in
S/4HANA
In S/4 HANA Cash Management Bank Account Management is introduced as brand-new function and core component.
The new Bank Account Management function comes with the following features:
I) Bank Account Master Data and Attributes
True Management tool- Bank Account management offers you a true management tool for your Bank Account Master Data.
Access Through Fiori Apps – You can access all maintenance functions through SAP FIORIapps.
Shorter Maintenance Process – Earlier the House Bank Maintenance was an important configuration task that we do in the
development system. It involved transporting the house banks and house bank accounts from the development system to
production.
Now with Bank Account Management we no more require this long process. Instead, now you maintain the house bank data
directly in the Production. Likewise, now the treasury department or user group owns the bank master data rather than IT.
Maintain Bank Master Data – The new BAM also provides more functions to control and maintain bank master data.
Example, you can now maintain payment approval signatories, overdraft limits, cut-off times, bank statement upload times,
internal contact person and external contact person for a specific bank account master data.
You may be interested in: Bank Accounting Configuration in SAP FICO
II) Reporting on Bank Master Data with Bank Hierarchy and Bank Account
Group
Flexible Reports – Bank Account management in cash Management in SAP S/4 HANA addresses the need to analyze the
access details for banks and bank accounts through flexible reports.
Reporting Functionalities – BAM offers complete reporting functionalities with filters, views and variants.
Hierarchies Creation – BAM also slows you to create two types of hierarchies to help you structure your reports.
Bank Hierarchies
Bank Account Groups
You can do many things with Bank account groups. For example:-
1. you can take your accounts and group them together in a hierarchical structure.
2. Further, you can use a bank account group to group bank accounts into areas of responsibility for different users.
3. Else you can also achieve other reporting and control goals.
4. You can also use bank accounts groups for your cash position reporting.

4. III) Structure Process and workflow for opening, closing and changing
bank accounts
As per the old process, these functionalities for managing bank account master data did not allow for any change in procedure
or workflow. Instead, these tasks were basically IT tasks performed in the development system and then transported to quality
assurance and production.
Any control processes and workflow was usually managed outside SAP. Now that process has become user procedure,
performed directly in production.
You will also need a framework to manage and control changes. Bank Account Management in Cash Management in SAP S/4
HANA Finance enables you to centrally control any change bank account master data and process these changes through a
structured workflow, monitored by a changelog.
IV) Bank Account Inventory and Periodic Review Process
You will periodically have to take stock of your bank accounts. I.e. by performing an inventory of all the accounts held by an
entity in your organization.
Certainly, it depends on the jurisdiction of the internal control environment where your Treasury Department operates.
While in past customers were managing this process in external systems. Or they were simply using an email-centric
procedure. But with the New Bank Account Management, they can take advantage of SAP business workflow functionalities. In
order to streamline the process, the system has embedded these functionalities in the bank account review process App.
You may read: Interview Questions on Bank Accounts
2. Daily Cash Operation
In classic SAP Cash Management, your tools were limited and need to consolidate information and validate across different
sources. You may even have opted not to use SAP Cash Management at all.
Overall, the process at times felt disconnected from your actual data and preparing reports was time-consuming.
But the New Cash Management in S/4 HANA resolves this issue by introducing a series of APPs and reports.
Know About: SAP S/4HANAFinance Online Training

5. I) Cash Management – Key Performance Indicators
Since KPIhelps you to get a quick view of the Cash Management Reports. You need not look into any detailed report to find
out whether any of the values you are monitoring is out of line. In other words, you can read the report at a glance.
Depending on the time in a day, you may see the status of the bank statement that has already been integrated and
processed.
Likewise, towards the end of the day, you may be interested in checking your cash position. The KPIshows it all directly on the
SAP Fiori Launchpad.
II) Bank Statement
A fundamental element for accurate knowledge about your cash position is the import status of your bank statements.
You may have deleted an issue while monitoring the import success rate of the bank statements. Likewise, perhaps you are
simply executing your daily activity and need to drill down into more detailed information in the Bank Statement Monitor app.
Now, from the app, you can quickly see where the issue is and you can directly contact the person in charge of the account with
the issue.
III) Cash Position
Once you are sure that you have processed all bank statements as expected, you are now ready to analyze your cash position.
Since you already had a quick glance and know the global level cash from the cash position KPI. Thus, now you can navigate
into the various reporting dimensions that the Cash Position App provides. It also analyzes your cash balances aggregated by
account, bank, country, currency etc.
Further, you can navigate into the cash position Detailed app, where you now get a line item level view of your cash balances.
To clarify any doubts, you can drill down into the original source document by navigating to the Check Cash flow items app.
IV) Payment management and bank transfers
Managing payments through the Bank Communication ( BCM) module may not necessarily be a cash management task.
However, these payments certainly affect cash management.
How?
It works in such a way that the flow of information from accounts payable to cash management must be accurate, timely and
reliable.
The “Make Bank Transfers App” is the tool to enter those transfers when you are the responsible cash manager or
treasurer. This App is complemented by the Approve Bank Payments App and related approval workflow.
You can trigger the bank transfer directly from the Cash position App or from the Cash Position Details App.
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6. Make Bank Transfer App
V) Cash pooling
Another way to make transfers is cash pooling. Cash pooling functionalities automates the bank transfers required for pooling
your cash into one or multiple pool header accounts.
Importantly, Cash pooling is not necessarily a replacement for your ZBA program but does fulfil a similar function.
You can use cash poling to pool accounts that are not in a ZBA structure or to pool header accounts held at different banks.
3. SAP Liquidity Management
The main job of SAP Liquidity Management is to manage the planned cash flows and finding actual values. For this job, there
is a Liquidity Planner under Liquidity management. This Liquidity Planner provides various tools to input, adjust, aggregate
and evaluate the cash flows.
These tools are very user-friendly and quick in providing the desired information as soon as it is available to the decision-
maker.
The information that it provides is truly reliable and gives its user a clear picture of the real financial situation of the business. It
not only helps the owner use its funds in a much efficient manner but also they can optimize their financial resources more
effectively.
All these tools of the Liquidity Planner extend a great help to enhance financial planning, influencing expected cash flows.
(More to come in this section…)
“As for now, I am writing only a brief about the SAP Liquidity management here in this article. I will extend this topic by
adding more information soon. Since I am in the process of completing it. In some time you will get more information on
this topic. Kindly wait.”
EndNote
Cash Management in SAP is truly a very important subject in S/4HANA. We mainly require it to manage the funds, bank
accounts, vendor payments and liquidity.
Is it important for me to learn to SAP Cash Management?

7. Development of Cash Management is a very important part of the SAP S/4HANA implementation in a business.
Thus, as an SAP S/4HANA Finance consultant, you must have the knowledge of this subject. You should also know
its components thoroughly in order to do the development process in the right manner and smoothly.
Learn More: SAP S/4HANAFinance Training with Cash Management
Important Video: Business Process in SAP S/4HANAFinance
Categories: SAP FICO SAP HANA
Tags: sap bank account management sap cash management sap s4 hana finance SAP Simple Finance
Know Pradeep Hota
About Pradeep Hota Pradeep Hota –
Profile. SAP HANA Solution Architect |
13+ Years Experience | CFA | Trainer &
Founder – Skillstek Pradeep Hota is an
SAP S/4HANA Finance Consultant and
Trainer (for Corporate and Online
Training) with a total 13+ years of
experience. His unique credential lies in
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