Beyond Central Finance - A Journey from SAP Central Finance (CFIN) to SAP S/4HANA

[nitin_gupta10]

I have written a lot about cfin via my blogs, however this blog will be focussing on topics which needs to be considered beyond Central Finance.

This blog will not consider  - Logistics and other migration scenarios rather it just talks on the scenario where CFIN is used a stepping stone and now the customer want to move to S/4HANA

In an organization when Central Finance is already live from some time there could be below starting points:

1. Customer is still using Central Finance as reporting solution


2. Customer is using Central Finance with Central Processing where the Finance processes are carried out in cfin box (which is of course S/4HANA)

      

We will focus one by one on each starting point

SCENARIO – 1:

Customer using Central Finance only as reporting solution

When this scenario is applicable then it means all logistics and finance processes are executed in source systems and cfin system is used for reporting or even for consolidation (Group Reporting, OneStream or HFM). Its assumed form here that all master data in cfin project is harmonized. Now from this point if customer have to move a step from CFIN to S/4HANA then below areas needs to be considered:

    

Asset Accounting (Asset Transaction Processing & Reporting)

• Asset Accounting is being used in source systems (SAP or Non-SAP) and the GL balances of asset Accounting are updated in CFIN via load/replication of data over the period of time. Now with full-fledged migration to S4HANA:
  
  
  
  • The Asset accounting needs to be stopped in source systems
  
  
  • All asset master data and Sub ledger balances needs to be migrated to S/4HANA
  
  
  • Balances in GL in CFIN system needs to be adjusted.
  
  
  
  


• This end to end functionality is delivered by Central Asset Accounting and it means that as a transition step Central Asset Accounting needs to be activated

AR & AP Open items handling

• In this scenario the transfer clearing scenario must have been activated where open items are replicated to CFIN as open and when the clearing happens in source those are cleared in CFIN (this is mostly for SAP source systems).


• Open items loaded/posted in S4HANA CFIN system CANNOT be paid from S4HANA system given the case where source is the leading system for payments.


• Solution can be
  
  
  
  • Central Payment needs to be activated as a cutover step so that open items can be paid/received in S4HANA system but this comes with certain restrictions like the items cant be reversed in S4 etc. Detailed solution and approach should be considered while working out the strategy
  
  
  • Enhance the SAP data which is loaded/replicated by CFIN to make system believe that the data is not replicated rather originated in S/4HANA system. This also have some limitations like reconciliation reports may not work for CFIN. Careful decision required based on business alignment as data will be used by business in future for processing & reporting
  
  
  
  

Other satellite systems/interfaces

All other necessary satellite systems/interfaces needs to be connected and well tested.

GL Clearing

Items replicated via central finance can not be directly cleared in CFIN. Right solution needs to be identified based on business strategy. It needs to be worked out whether Centra clearing of open items is needed to handle the GL open items or any enhanced solution needs to be introduced to fit based on data and processing/reporting needs

Stopping SLT

SLT replication should be stopped but at the right timings. First periods needs to be closed in source and then SLT should be stopped as a part of cutover activity

SCENARIO – 2:

Customer using Central Finance with Central Processing including Central Payments

All relevant points mentioned above are applicable for this scenario also. Only change will happen is in

AR & AP Open items handling

Central Payment is already activated and open items are paid/received in S4HANA system. This can continue however this comes with certain restrictions like the items can’t be reversed in S4 etc. Detailed solution and approach should be considered while working out the strategy. Any reversals, billing cancellations should be processed in target systems directly and lot of times for such scenarios the fresh document (inverse) needs to be posted as reversal/cancellation will not be possible for a replicated document.

Feel free to add more via comments based on what you have seen in such projects. There is too little happing in this space as of now and very few customers are planning to move from CFIN to full S/4HANA