Sap s4 hana 1709 what's new in financial planning & analysis

PUBLIC
Edwin weijers, SAP
January 2018
SAP S/4HANA 1709
What’s new in Financial Planning & Analysis?
Status: PLAN
until final release
shipment

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All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from
expectations. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates,
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Disclaimer

Agenda
Central Finance
 Fiori
 Central AR/AR management
 Enhanced VAT/TAX Configuration check
 CO-PA support
 Third party interfaces
Financial Planning &
Analysis
 Fiori
 Profitability Analysis
 Planning Content
 Material Ledger
 Semantic Tagging
 Flexible Hierarchies
 SAP RealSpend
 SAP Financial Statements Insight
Accounting and Financial
Close
 Fiori
 Subsequent introduction of document splitting
 SAP S/4HANA Financial Closing cockpit
 SAP S/4HANA for advanced compliance reporting
 Real time consolidation
Treasury Management
 Fiori
 Innovations of Core Treasury
 Value-added cloud services
 SAP Cash Management innovations
Financial Operations
 Fiori
 Integration with Business networks
 Value-added cloud services
 SAP Shared Service Framework

Financial Planning & Analysis
Fiori

Future DirectionPlanned innovations
2018 / 2019 Product vision2017 Planned innovations
This is the current state of planning and may be changed by SAP at any time.
SAP Fiori Road Map: Finance
Cost Accountant - Inventory
SAP Fiori app Schedule Inventory Accounting Jobs
 Eliminate possible rounding differences for standard price materials
 Mark material cost estimates
 Release future prices
 FIFO (first in first out) valuation processes
SAP Fiori apps to analyze inventory valuation
SAP Fiori apps to view and control product cost planning:
SAP Fiori apps to view and control actual costing:
SAP Fiori Overview Page covering actual costing
SAP Fiori app Manage Material Valuations to view and change
material prices and inventory values
SAP Fiori app Manage Costing Runs – Estimated Costs to create,
copy, and delete multiple costing runs
SAP Fiori Overview Page covering the functional domains:
 Product cost planning
 Material prices and inventory values
Solution today in SAP Fiori apps reference library

Cost Accountant – Production
New SAP Fiori apps for KPIs driven cost analysis for manufacturing
customers based on event-based approach to analyze material costs,
overhead, settled WIP (work in progress), scrap, variance.
New SAP Fiori analytical app to support product cost collector cost
analysis for manufacturing customers:
• Display Product Cost Collector Cost Detail
Enhancements to SAP Fiori analytical app Product Cost Analysis:
• Supports New Planning Solution to display planned costs for product cost
collector in Product Cost Analysis
• Provides further dimensions according to derivation functions to analyze
production order costs
Enhancements to SAP Fiori analytical app Product Cost
Analysis:
• Supports New Planning Solution to display planned costs for manufacturing
orders and product cost collector in Product Cost Analysis
• Supports additional dimensions to report production order costs on these
dimensions, such as operation and work center

Application Brief: Production Cost Analysis
The Production Cost Analysis app enables:
Flexible navigation and collaboration capabilities
Order analysis
 Overall and Detailed Cost
 Order Status
 Exception Status
Cost Component Group
 Cost Details
 Cost Components
 Cost Component Groups of
Orders
Work Center
 Plan/Actual Costs at Work
Center/Operation Level
 Harmonized plan costs
based on new planning
solution for manufacturing
orders

Work Center View
 Enabled new planning solution (Based on
ACDCOP) for manufacturing orders
related Plan Costs
 Reports on Work Center / Operation to
help customer analyse production costs at
more detailed responsible area

Cost Accountant - Sales
New SAP Fiori launchpad role Cost Accountant – Sales to
 Support revenue and margin analysis by market segment
 Allow period end close processes, e.g. allocations
 Support Event-Based Revenue Recognition for commercial projects
 New template for plan data upload
SAP Fiori app to support reporting on realigned profitability
characteristics
SAP Fiori apps to analyze plan-actual-comparisons and profitability
for projects
SAP Fiori app to support Event-Based Revenue Recognition for
some Sell from Stock scenarios:
 Ensure matching principle for Sell from Stock, “Customer Returns” and
“Sales Processing using Third Party Direct Ship”
 Analyze revenue recognition postings
SAP Fiori apps to analyze order entry
Enhancements to SAP Fiori app to support Event-Based Revenue
Recognition for further scenarios for Sell from Stock

Cost Accountant - Overhead
New SAP Fiori apps
 Flexible hierarchy
Enhancements to SAP Fiori apps:
 Manage Profit Center Master Data to provide extensibility
 Manage Internal Order Master Data to display Asset Under Construction
when capital expense
 Import Financial Plan Data to enhance verification through new plan data
report
New SAP Fiori app Manage Cost Allocations to provide plan cost
allocations using SAP’s enhanced data structures
Enhanced tools to allow key users to define company-specific
reports
New SAP Fiori apps to leverage newly available data structures
 Manage Commitments
 Manage Budget
 Manage Manual Postings
Refactoring and enhancements to Fact Sheets
 Reduce complexity of the architecture and configuration replacing enterprise
search to Core Data Services (CDS) based search and CDS views

Manager - Finance
Enhancements to the SAP Fiori analytical app My Spend to support
Plan and Expense Analysis:
 Supports Statistical Orders
 Supports new planning solution to display plan data in My Spend
 Enhancements of functionalities for better user experience
Further enhancements based on customer feedback

Profitability Analysis in the Universal Journal

Splitting Cost of Goods Sold in SAP
S/4HANA
 Enhanced functionality enables to split
costs of goods sold during more
processes such as third party or other
processes with account assignment to
internal orders or projects
 COGS Splitting customizing has been
adjusted
 Previous COGS Split functionality
which processed the splitting only for
goods movements with reference to a
sales order is still available

Reporting app for Realignment Results
 With this app you can see the
adjustments that were made to your
posted profitability reporting
dimensions by the realignment for
Profitability Analysis
 You gain insight into the changes
resulting from realignment runs by
reviewing the profitability
characteristics as originally posted and
after realignment and Analyzing the
results with visual graphs

Planning Content

New workbook to plan COGM:
Material Quantity * Standard Cost =
Cost of Goods Manufactured
Planning in SAP S/4HANA: Financial Product Cost Calculation
Workbook with several worksheets to
demonstrate end-to-end process
 this can be divided into separated role
specific workbooks at customer site
Sales Quantities per Plant and (Reference-)Product
Sales Prices per (Reference-)Product
Customer Deductions per Customer Group
Production Costs transferred from Cost Estimate
Lot Sizes transferred from Cost Estimate
Profitability Analysis with ability to calculate Sales
Amount, Deduction and Production Costs
Workbook Steps:

Material Ledger

Product Cost Controlling on the time scale
Evaluating master data
 Bill of materials
 Routing
 Planned prices
 Planned activities
 Planned yield
Recording logistical
information for
controlling:
 Production Orders
 Consumptions
 Yield & scrap
 Purchasing & supplier
invoices
 Activities & time recording
Recalculating the value
flow using
 Actual quantity structure
 Actual activity recording
 Multi-level value flow
 Actual raw material prices
Reporting Costs and
Contribution Margins
 Production costs
 Sales Revenues
Dimensions
 Regions
 Channels
 Customers
In advance,
e.g. yearly
During periods After period end Any time
Cost Planning Procurement Production Actual costing Profitability Analysis

Trends in Material Management & Valuation
Latest trends in Material Management aim for
 Reducing required system resources
 Improving scalability & throughput
 Flexible international valuation requirements
(parallel currencies and parallel accounting standards on material / product level)
 Accurate transparency into the actual cost flow and transfer prices
ONEPrinciple of
Since the Data Model of the Material Ledger (ML)
module supports all these business requirements, it
was chosen as the basis for material inventory
valuation in SAP S/4HANA

Communication Obstacle
SAP: “Material Ledger is now obligatory for all customers”
What Customers understood
 We never needed ML and now we have to use it
 A lot of extra work in implementation
 Extra work for each month end closing
 Standard price and moving average price are not
possible any longer
What SAP wanted to say
 Material Ledger and Finance is now responsible for
material valuation
 Only one solution (ML) and not two in parallel (ML
+ MM)
 The checkmark ‘material ledger active’ will be set
 Material valuation is now stored in ML tables and
not MM
Reality: Most Customers will not feel any consequences of the SAP development decision

Improvements in Material Valuation with S/4HANA
Advanced reporting capabilities because of better integration into accounting
 material valuation is part of the unified journal entry.
* Current lab results indicate that the elimination of exclusive locks lead to a throughput increase of factor 5 for the valuation of material documents.
5x throughput increase
for the valuation of
material documents*
Improved scalability through optimization of locking mechanism. In case of
standard price materials exclusive enqueue locks for application processes
are eliminated, instead only shared locks are used.
Redundancies for material valuations are eliminated (for customers already
using Material Ledger). Local currency was stored twice in different material
master tables and in ML tables.
reduced memory
footprint
3x parallel valuations
for currencies and
values
The new material valuation solution enables customers to store material
prices and inventory values in multiple currencies and according to several
parallel accounting standards.
improved reporting
capabilities

Material Valuation in S/4HANA
Actual Costing
 Optional revaluation of stock and COGS
 Leverage Actual cost component split
Realtime Insights
 Analyze & Optimize the Flow
 Use realtime KPI‘s (Inv. turnover)
 Predict/ Simulate
Up to 3 currencies
 Tracking historic rates in material master
 Local legal valuation & e.g. hard or trading currency
Transfer prices
 Legal Costing
 Corporate Costing (w/o intercompany)
 Transfer prices (political)
¥
Digital Core
SAP Cloud PlatformSAP HANA
Business
Transactions
Intelligent
Insights

Notes
2416935 - Material Ledger with Actual Costing in S/4HANA 1610: HotNews
All relevant SAP notes can be found using the following search criteria: MALENA, MLDOC, FCML4H.
2354768 - S4TWL - Technical Changes in Material Ledger with Actual Costing
For a usage of actual costing it is recommended to go for the latest SP of S/4HANA 1610. An
implementation without SP should be avoided.

News in S/4HANA 1709
Parallel Cost of Goods Manufactured now working with 3rd parallel currency in CO
 Still no support of account solution
 No activation for a subsequently introduced new parallel ledger
New Value Flow Monitor (using ACDOCA and new ML document)
Valuated Quantity Structure reimplemented again (was missing in 1610)
Continuous Improvement

Semantic Tagging

Semantic Tag – New Infrastructure of Reporting
Challenges
 Double, sometimes even triple maintenance
of account group, Financial Statement
Version (FSV) for reporting
 Data inconsistency regarding G/L account
adding and deletion
 Lack of multi-dimensional drill down report
 Lack of key user tools to enable finance user
to lead the change process
Solution
 Semantic Tag based reporting
 Key User Tools – Custom Analytical Query
What customers do with it:
 Tag master data to classify objects (no
need to misuse fields anymore)
 derive operation business unit from profit
centers
 derive hierarchies
 link master data to assist derivation of CO-
PA characteristics

Semantic Tag Semantic Tag Name
COGS Cost of Goods Sold
DEPREC Depreciation
GROSSPROF Gross Profit
GROSSREV Gross Revenue
INTEREST Interest
NETINC Net Income
NETINCBT Net Income before Ta
NETREV Net Revenue
OPEREXP Operating Expenses
OPERINC Operating Income
REVENUEADJ Revenue Adjusted
REVENUEUNB Revenue Unbilled
SELLEXP Selling Expense
TAX Tax
…
…
Reports
 Cash Flow
 Contribution Margin
 Project Profitability
 Product Profitability
 Event-based Revenue
Recognition
FSV Semantic Tag
After assignment semantic tag to FSV, the semantic tag can be reused in the report and KPI.
Any future changes of FSV structure and semantic tag assignment will automatically reflect in report and KPI
without any code change.
KPI

Following report has been consumed and released:
Event Based Revenue Recognition Stock Champion Project Profitability
Product Profitability Cash Flow Statement

Cash Flow Statement – Indirect Method
New Cash Flow Statement (Indirect Method) can support multi dimension drill down, e.g. G/L account, cost center, profit
center, fixed asset transaction type, etc

Cash Flow Statement – Indirect Method
Drill down dimension can be displayed in flat list or hierarchical way (e.g. G/L account shown in FSV).
In addition, as the report is also based on semantic tag infrastructure, the user can change the report figures by changing
FSV or semantic tag assignment to FSV. The report format and formula can also be changed with key user tools – custom
analytical query.
Drill Down to G/L Account Drill Down to G/L Account in FSV style

Flexible Hierarchies

Hierarchies are used e.g. for Profit Centers
or Cost Centers
Flexible Hierarchies are based on master
data attributes and tags.
Flexible Hierarchies: Challenges
 Organizational changes are complex – however
frequent.
 High effort to set-up and build new hierarchies as
all org units need to be included in new hierarchy:
 Example customer: 12.000 Profit Centers / 7.000
Structuring nodes.
 Customers use a big spreadsheet to list all nodes
and profit centers tag with strong naming
conventions as cross-check.
 Setting up the spreadsheet and double checking
for correctness requires a lot of time.
 Setting up the hierarchy from the spreadsheet is a
complex task on its own.

Flexible Hierarchies: Capabilities and Benefits
 Supports tag mass changes
e.g. selecting a list of Profit Centers based on existing tags and then change a tag, e.g. Line of Business or
Segment.
 Enabling to build the hierarchy based on the assigned tags provides a fast and efficient way to
define a new hierarchy.
Instead of assigning each and every Profit Center to a new hierarchy, one simply defines the order of tags
(e.g. as sequence of attributes; c.f. navigation attributes in BW).
 Setting up a new hierarchy based on sequence definition
e.g. based on Segment->Line of Business->Country just requires this sequence definition whereas with the
current hierarchy, you would need to define the hierarchy as mentioned and then assign each and every
Profit Center in the correct level.
 This also provides a fast and efficient way to setup different hierarchies in parallel just by using a
different sequence of attributes.
Example: "sometimes start reporting with the Segment, sometimes with the Line of Business"

Profit Center Valid From Valid To Country Segment Lob Product
1001 2013.01.01 9999.12.31 DE SEG_01 FUEL GASOLINE
1002 2016.01.01 9999.12.31 DE SEG_01 FUEL DIESEL
1004 2016.01.01 9999.12.31 DE SEG_02 LUBES INDUSTRY
1005 2016.01.01 9999.12.31 CN SEG_01 LUBES MOTOR
1006 2016.01.01 9999.12.31 CN SEG_01 LUBES INDUSTRY
1007 2016.01.01 9999.12.31 US SEG_01 FUEL GASOLINE
1008 2016.01.01 9999.12.31 US SEG_01 FUEL DIESEL
1009 2016.01.01 9999.12.31 US SEG_02 LUBES MOTOR
1010 2016.01.01 9999.12.31 US SEG_02 LUBES INDUSTRY
View Current Tag Assignment Update Tag Assignment
Define Sequence of Hierarchy
1004 2016.01.01 9999.12.31 DE SEG_02 LUBES INDUSTRY
1 2 3 4
Generate Hierarchy
CN
SEG_01
LUBES
INDUSTRY
1006
MOTOR
1005
DE
SEG_01
FUEL
DIESEL
1002
GASOLINE
1001
SEG_02
FUEL
DIESEL
1003
1004
US
SEG_01
FUEL
DIESEL
1008
GASOLINE
1007
SEG_02
LUBES
INDUSTRY
1010
MOTOR
1009
Flexible Hierarchies: Process

Maintain Profit Center Tag1
Profit Center Country LoB Product Line Reporting Group Continent
1001 US FUEL GASOLINE Americas North America
1002 DE FUEL DIESEL EMEA Europe
1003 DE FUEL DIESEL EMEA Europe
1004 DE LUBES INDUSTRY EMEA Europe
1005 FR LUBES MOTOR EMEA Europe
1006 AT LUBES INDUSTRY EMEA Africa
1007 CN FUEL GASOLINE APJ Great China
1008 HK FUEL DIESEL APJ Great China
1009 CN LUBES MOTOR APJ Great China
1010 JP LUBES INDUSTRY APJ Japan
1011 US GAS LPG Americas North America
1012 DE GAS LPG EMEA Europe
1013 DE GAS CNG EMEA Europe
1014 CN GAS LPG APJ Great China
Tagging
After maintaining the tags on profit center and defining the hierarchy
sequence, you can flexibly generate multiple hierarchies with focus on
geography, line of business and mixed.
Hierarchy Report
Based on Geo
Level
Hierarchy Report
Based on Line of
Business
Flexible Hierarchies: Quickly generate hierarchy based on rules and tags

SAP RealSpend

Your goal: standardize, automate management reporting
Make use of BI capabilities and enable self-service reporting for ad-hoc analysis
Business Benefits
 Provide decision makers with streamlined efficient
reporting and analysis from a reporting factory
 Heavily reduce individual efforts
 Provide common ground for Business steering
 Enables line managers to maximizing budget
utilization by
• proactively manage spending in real-time
• for all current and future activities
SAP RealSpend

SAP Financial Statements Insight

Your goal: standardize, automate management reporting
Make use of BI capabilities and enable self-service reporting for ad-hoc analysis
Business Benefits
 Provide decision makers with streamlined efficient
reporting and analysis from a reporting factory
 Heavily reduce individual efforts
 Provide common ground for Business steering
 Support drill-down analysis from group figures to
cost center
 Allow for simulation and what-if analysis
SAP Financial Statements Insight

SAP Financial Statements Insight: Roadmap Overview
Today
2017
2018+
Flexible Hierarchies
• Dynamically adapt hierarchies for profit centers
• Simulate impact of hierarchy reorganizations
Leverage SAP S/4HANA
• Dynamic filtering and comparison with high
performance
• Drill down to line item level
Integration of Further Finance Data Sources
• Compare actuals and plan
• Use different plan versions to account for
different possible scenarios
Notifications
• Set thresholds for plan/actual variances or major
deviations between current and historic balances
• Receive alerts for thresholds and instantly view
area of interest
Smart Alerting
• Let the system discover anomalies and
unusual variances autonomously
• Receive alerts and acknowledge discovered
irregularities
Collaboration
• Share analysis results
• Annotate charts and define next steps together
with your colleagues
RECENT
INNOVATIONS
FUTURE
DIRECTION
PLANNED
INNOVATIONS

Content for SAP Digital Boardroom & Analytics Cloud

General:
General assessment of financial performance as information to the management board –
based on P&L, investments, and account positions
Profit and Loss:
Profit and Loss details as well as financial key performance indicators such as revenue,
contribution margin and expenses
Cash Flow and Days Outstanding:
Cash Flow and Inventory overview, analysis of days sales outstanding and days payables
outstanding
Investor view:
Working capital, debt to equity ratio as well as return on equity
Data Connectivity:
CDS-View based on S/4HANA Finance data
General ledger information (“ACDOCA”)
Highlights LoB Finance
See also next slide

General:
General assessment of financial performance as information to the management board –
based on P&L, investments, and account positions
Growth:
Analysis of growth KPI Net Revenue based on YoY and Plan vs Actuals. Among other
analysis are also available Price-Volume-Mix Effects and Machine Discovery
Profitability:
Analysis of EBIT and EBITDA based on Actuals and Forecast. Other profitability KPIs like
Net and Gross Profit are also available. The P&L statement is available.
Liquidity:
Analysis of Cash Flow based on Indirect Method. DSO, DPO and various liquidity ratios
are available. The Cash Flow statement is available.
Data Connectivity:
CDS-Views based on S/4HANA Finance data
General ledger information (“ACDOCA”)
Highlights LoB Finance - Financial Performance

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and/or platform directions and functionality are all subject to change and may be changed by SAP SE or its affiliated companies at any time for any reason without notice. The
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