'Soft close' in S4HC

[former_member94298]

In the documentation about S/4HANA, a lot has been made of the fact that the system enables businesses to move more towards a 'soft close' so speeding up the process of month end.

What does this mean in practice?  I am thinking in particular about a lot of the CO processes (allocation cycles; production variance calculation & settlement etc) - where the apps are very much the old ECC apps rather than anything clever and new, and almost all run on an accounting period basis.  Is there any way of running such tasks more frequently?

For a business that relies heavily on cost allocations to see their month end result, is the old way to get an early view on how a month is looking to repeatedly run / reverse / re-run allocations?

Is there any clever approach to this that I might be missing?

[waman_shirwaicar · Accepted solution]

Hello Claire,

One functionality which helps in 'soft close' is that of attributed PA segments. This is explained in my webinar recorded in KBA 2444746 CO-PA [Expert Webinar] S/4 HANA Finance: Controlling and Profitability Analysis (CO-PA). The concept of attributed PA segments is explained from minute 17 onwards in the webinar. Although the webinar basically deals with S/4H OP the concept of attributed PA segments and how it helps to reduce settlements is explained and that concept is valid for S/4H PC also.

regards

Waman

[former_member94298 · Accepted solution]

Thanks.

I guess this still doesn't really help with overhead allocations?

Is there anything that may be coming with the new allocations apps on the roadmap for 1811 and beyond - or are those just creating a nice new Fiori frontend on the old functionality?

[waman_shirwaicar · Accepted solution]

There is currently a discussion in development about a single allocation processor. So all the allocations could be processed on a single screen, including cost center to cost center, cost center to COPA and even maybe TDD. Currently we have different screens (Fiori apps) for each type of allocation. However this concept is still in discussion / feasibility exploration mode.

[former_member94298]

You could indeed reverse and re-run allocations repeatedly - but when you have a series of interlinked cycles, this can become pretty cumbersome.

Agree that the question applies equally to both On Prem and Cloud - and really just wanted to understand a bit more about the practicalities vs. the sales pitch!

Obviously, keen to understand if there are either any limitations / additional developments in the cloud - as we all know that it's fatal to assume it does the same as On Prem!

[waman_shirwaicar]

One more aspect to settlement:

Using best practice 1NT Project Financial Control customer can maintain a single settlement rule to PSG at top-level for projects, which are created with profile "project with revenue". Each actual cost posting (also to lower level WBS elements) then will be attributed with these characteristics. Hence, it is not necessary to settle these projects (actually it is not allowed).

For projects created via best practice process J11 Customer Project Management - Project-Based Services the characteristics are automatically derived via the assigned sales order item data and hence a maintenance of settlement rules is not required and not possible.

[former_member133122]

For allocations, you could run them daily. Typically, when you run one that has already been executed in a period it will reverse then rerun. However, that doesn't address costs such as depreciation or payroll which only post periodically to cost centers (or other cost objects).

Internal orders can be settled nightly if needed, but again there is a limitation where they haven't released the templates to schedule the jobs so you have to get creative.

[waman_shirwaicar]

This concept of daily run is not unique to cloud. The same thing can be done in onprem in S/4H OP and as well as classical ERP. I guess the question Claire has is what is unique about soft close in cloud ?

[former_member133122]

waman.shirwaicar Yes, I agree completely. We're all looking for that information. It seems to be more around attributed PA segments to reduce the need to allocate.

[waman_shirwaicar]

Attributed PA segments reduce the need for settlement.

Regarding allocations, which kind of allocations are you referring to ? Cost center allocations to COPA or cost center to cost center ?

[former_member94298]

A bit of both: we have a layer of cost centre to cost centre allocations - but then quite a lot of cost centre to COPA - so it becomes quite cumbersome to post and reverse all cycles