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Introduction to

Digital Finance with


SAP S/4HANA 1809
SAP European Finance CoE
SAP CoE is…
 Mutualisation of Global Portfolio to maintain our offers at state-of-the-art to support customers
 A Capgemini investment for each portfolio line in knowledge and assets such as Point of View, decks, use cases available in S/4HANA
Test&Demo System, participation to SAP Bootcamp, training, certifications etc.

Scandinavia
Netherlands Johan Kirstein
Erik Van Den Berg Mark Allen Carter
Thomas Mulder

UK Germany
John Crowley Sebastian Pelmer

France
Phuong Nguyen

Spain
Rovira Navarro Ricard Europe Cluster
Georges Debroux
Italy Topi Uitto
Sergio Di Molfetta

S/4HANA 1809 – CoE Deck | 8th February 2019 © Capgemini 2019. All rights reserved | 2
Contents

1 Enable the Digital Transformation

2 S/4HANA Finance 1809


 S/4HANA Finance Core
 Inventory Valuation and Transfer Price
 Profitability Analysis
 Universal Allocation
 Machine Learning & Accrual Management
 Treasury
 Analytics
 Central Finance

3 Credits

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Enable the Digital
Transformation

© Capgemini 2017. All rights reserved | 4


What is S/4HANA

SAP S/4HANA is an entirely new


SAP S/4HANA is the application
generation of SAP Business Suite
layer that works as Digital core
that is characterized by
for an IT environment. It’s an
simplifications, massively
ideal choice as Digital Core
increased efficiency, and
because of SAP Fiori-based UX,
compelling features such as
Real time Analytics, capability to
planning and simulation options
handle various types of data
in many conventional
from multiple sources.
transactions.

SAP S/4HANA signals a move SAP S/4HANA is a non-


away from the transactional Disruptive journey toward Digital
system that merely records data transformation because of
toward giving end users active Compatibility Views so custom
decision support in real time that programs/reports with read
is based on data from both access to old tables continue to
internal and external sources. work.

Mission: Establish SAP S/4HANA as the Digital Core to support the Digital Transformation of our customers
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The Value for Finance perspective
SAP S/4HANA allows to run your
processes faster, which enables faster
Issues planning, reactions, reporting, and
Considerable skills are required to
operate and benefit from sophisticated
analysis because of both Technology analytical tools such as SAP Predictive
capability and streamlined processes Analytics so human resources know-how
 Lack of timely, qualitative, (e.g. Intercompany reconciliation, GR/IR increasing is crucial.
good, and easily accessible monitor, Financial Closing Cockpit).
information Execute
continuous Develop
 No transparency finance talent in
process the finance
 No reliable forecasts improve- organization
With the introduction of S/4HANA
(e.g., revenue) BPC Embedded a single tool ments Because the introduction
Optimize of the Universal Journal
 Lack of perspective is provided to plan Profit and planning, Measure/
loss, Cost of sales, Market F Finance simplifies data structures,
budgeting, monitor
segments, Profit centers, Cost
I Efficiency N predicting the future
and N
E
business
centers, Internal orders, A & can be performed.
forecasting N
E performance
Projects, Liquidity. C
D
S
E Business
Drive Insight Drive
Benefits integration enterprise
of information cost
across the Provide
reduction Processes normally executed
 Soft close, no waiting to enterprise input
It means be able to have all into at period-end due to long running
analyze data after month-end information technically captured in enterprise times can now be run on a daily or
close activities one place: a single source of truth. strategy weekly basis (batches removed).
Reconciliation no longer needed.
 Support/manage/mitigate
enterprise risk
 Strengthen compliance Challenge is predictable financial results, eliminate surprises,
programs/internal controls and respond to market changes with more agility. it’s absolutely
necessary to link company’s KPIs with company’s strategic objectives
 Manage investor/stakeholder (BPC Embedded, SAP HANA Live and SAP Crystal Reports.
relations
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S/4HANA Finance 1809
S/4HANA Finance Core

© Capgemini 2017. All rights reserved | 7


Simplify Data Model
The Value for Finance prespective (Integration of information)

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FCC on S/4HANA Benefits

Faster Entity Close Audit Trail,


through improved Logging and
close efficiency Documentation

Real-Time Insight
Governance and into Closing Status
Compliance S/4 HANA Monitoring by Subsidiaries
and Headquarter
Financial
Close Analysis
Closing Cockpit

Global Game Plan for


Transparency and Entity Close; leverage it
Insight for multiple Org. Unit
and Closing Type

Automated Closing Task, Collaboration,


even in Remote System Notification and Workflow

15–25% Faster Closing Cycle – While ensuring high quality compliant result
Source: SAP Performance Benchmarking
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S/4HANA Finance 1809
Inventory Valuation and
Transfer Price

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SAP Solution...
Multiple Views of the
Same Material
Flow

Legal view focuses on inter


company pricing agreements
and legal tax requirements

Group view focuses on


eliminating intercompany
profits and acting as „one
company‟

Profit Center view focuses on


management prices agreed e.g.
between divisions

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Transfer Pricing: Markups for material movements –
Divisions

Group

Company 1 Company 2 Company 3

50$ Division 1 Legal:70 $ Legal:70 $ Division 2 Legal: 90$ 100$


Group: 50$ Group: 50$ Group: 50$
Profit Profit Profit Profit
PrCtr: 60$ PrCtr: 80$ PrCtr: 95$
Center 1 Center 2 Center 3 Center 4
Division: 50$ Division: 80$ Division: 80$

Financial Management
Entity Close Intercompany Consolidation Disclosure
Accounting Accounting

Financial Steering Model (Universal Journal)

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S/4HANA Finance 1809
Profitability Analysis

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Added value of Profitability Analysis integrated in the
Universal Journal
Summary of enhancements
Integrated
profitability Costing-based
Capability Example analysis * COPA

Reconciliation Reconciliation of legal and management accounting and profitability, for example by
profit center  
Drilldown by profitability Drilldown by product and customer-related characteristics in COGS and revenues
characteristic from income within income statement  
statement

Profitability characteristic For unbilled revenues on WIP, customer wants to see the project, region, customer
on balance sheet items category  
Top-down distribution Distribute high-level costs to the relevant market segments to allow profitability
analysis  
Realignment After changes of profitability characteristic such as division, it is possible to derive
for historic data new values in margin analysis  
Cost of good sold Breakdown of COGS into fixed and variable, as well as different kind of costs such
(Cost component) split as material, administration and overhead costs  
(Actual costing scenario added with S/4HANA 1809)

Production variance split Distinguish variances in costs of producing materials by price, quantity or
scrap variances  
Statistical sales conditions Sales conditions can be used to calculate contribution margin level, such as sales
commissions, calculated freight or discounts, which are not posted in G/L (with  
S/4HANA 1809)

Incoming sales order entry Creation of a sales order item generates expected revenue and COGS entry in
profitability (with S/4HANA 1809, using predictive accounting logic)  
* For single product cost valuation only
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Instant Margin Insight with S/4HANA

COGS Split
with actual Costing

Statistical
Sales Conditions
 Multi-dimensional
reporting based
on Universal
Incoming
Journal
Sales Orders
 Reconciled by
nature
 Real-time

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S/4HANA Finance 1809
Universal Allocation

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Motivation of Universal Allocation
Problem Statement – Why do we need a Change?

Organizations struggle Analyst struggle Lack of Lack of


top understand their to answer simulation state-of-the-art
allocation process allocation questions capabilities visualizations

 Complex organization  How did this cost get  How would the result look  Limited standard reporting
structures requiring allocated to my area? like in case we merge two  ERP transactions only
multiple views (Traceability – billed in vs legal entities? based on one cycle at a
(stewardship vs allocated)  Customers want to time
business unit)  How do amounts flow understand and identify  Difficult to explore the
 Legal and industry across the chain of cycles possible financial effects of allocation structure
challenges and segments? changes allocation rules holistically
 High number of cycles  Are the tracing factors on the their financial data
 Simply process with
segments (copy plan to reliable? (SFK/activity  Tool are bound by guided procedures,
actual) type) operational requirements reducing effort of
 Long cycle runtime  Why am I accountable for (year-to-date problem) knowledge transfer
 Complex knowledge this? (controllable drivers)
required
 Dynamic organization
boundaries
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Outlook
Prototype for Cost Object Analysis

Example Scenario
You’re manager, who is responsible for
a Cost Center. You want to answer the
following questions:

Who is allocating which cost to me?


See the original Cost Centers that
are sending you costs via allocations

Which tracing factor is used?


On which basis is the cost amount
calculated (e.g. headcount or sqm)

To whom do I send which cost?


Comprehend to which receivers you
send cost on which basis

S/4HANA 1809 – CoE Deck | 8th February 2019 © Capgemini 2019. All rights reserved | 18
S/4HANA Finance 1809
Machine Learning & Accrual
Management

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Machine Learning – Cash Application

Intelligent receivables automation powered by S/4HANA 1809 Machine Learning

History
Matching proposals &
Payments
Cash Application automated payment
Invoices
Machine Learning clearing
Payment Advices

SAP Cash Application intelligently learns matching criteria from


your history, reads and processes payment advice documents,
and automatically clears payments with minimal intervention.

Drastically reduce
Allows shared services
Improves days Seamlessly integrated manual effort, focus
to scale as the
sales outstanding with SAP S/4HANA on strategic tasks
business grows
and service quality

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Machine Learning – GR/IR
The goal of the ML service is to learn from decisions taken in the past, to apply the learned
knowledge to the new business situation and to make recommendations for the next meaningful
steps for each purchase order item.
The recommendations from the algorithm are seamlessly integrated in the UI.

GR Yes Automatic
equals
Clearing
IR
Goods and Invoice Receipts
posted to a Purchase Order No

Recommend the best next action based on


similar decisions made in the past
Recommendation Service

Automatic GR/IR Automatic


Write-Off
Clearing Postings Clearing
Investigation & Decision

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Machine Learning – Accrual Process

Purchase SAP S/4HANA for Accruals Management


Orders

Unified accrual
Manual data structure
Accruals

Multiple Calculate Review Post


Journal
Sources Entry

Spread-
Accrual
sheets  Unified User Experience
Object
 Transparent Reporting, Analytics
....  Auditability

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S/4HANA Finance 1809
Treasury

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What’s new in 1809?

Cash Management
Bank fee importing and reporting
Import the ISO 20022 camt.086 format bank fee file into the system and provide the cash manager with a comprehensive view of the services
provided by banks and the charges paid to banks
 Import Bank Services Billing Files
 Monitor Bank Fees
 Manage bank fee condition
Snapshot of historic cash position
 Cash manager to retain a historic snapshot of the cash position report for comparison with
the current view
 Ability to compare yesterday’s historic cash position with today’s view to reveal the differences
in actual and to optimize the future cash disposition for investment or financing
Enhance the liquidity forecast through integration of real estate data
Provide the cash manager with an enhanced, more comprehensive forecast of cash data by including cash flow information from contract and leasing
management
 Tap into business operations to provide an indication of future cash flow to the customer who uses contract and leasing management, even before it
is booked in accounting
 Integrate the cash report with future flows
Correspondence from bank account management
 Generation of correspondence to banks based on opening, changing, and closing activities in bank account management

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S/4HANA Finance 1809
Analytics

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S/4HANA Analytics
What’s new in 1809

With 1809 release, new FIORI APPS are Analytics / BI (user)


deployed by SAP: DATA
Aggregate Visualize
 Accounts Payable Overview
 Accounts Receivable Overview
 Asset Accounting Overview
 …
Predictive Analysis (SAP)

It was also introduced the possibility to use


Embedded machine learning to perform Train model

simple prediction like trending or forecasting


(on simple model). Prepare data Apply model

Algorithm used should be low cpu Monitor


demanded. Propose/
make decision

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Planning: What has changed
Before Now

Standalone planning
application in the Cloud Analytics Cloud
(SaaS)

Standalone planning
Standalone on premise and with SAP S/4HANA Analytics Cloud
application BPC (all Versions)
and other Cloud apps

Planning application Customers requiring an


BPC Optimized on premise solution BPC*
embedded within S/4HANA
(on premise)

Planning application
embedded within S/4HANA N/A
Cloud and other Cloud apps

*BPC optimized can still be used for real-time planning on SAP S/4HANA on premise and BPC for BW/4HANA is recommended for standalone on premise deployments
S/4HANA 1809 – CoE Deck | 8th February 2019 © Capgemini 2019. All rights reserved | 27
S/4HANA Finance 1809
Central Finance

S/4HANA 1809 – CoE Deck | 8th February 2019 © Capgemini 2019. All rights reserved | 28
What is SAP Central Finance
Customers with heterogeneous system landscapes or even single system landscapes with limitations to adopt innovations
quickly (out of maintenance, heavily customized) can take advantage of the Central Finance deployment approach of SAP
S/4HANA that allows companies to replicate (re-post) financial transactions from several source systems into a single instance
of SAP S/4HANA.
Operational ERP Systems Central Financial System Customers can benefit from:
Local Financial Processes executed Each Operational Systems
in Each System Financial Data Pass into Central Finance  The latest reporting innovations and
architectural simplification
 Gain data access to better
consolidation entity reporting
 Leverage on modern central process
01 Operational ERP System
execution capabilities (Warehouse
Mapping shipping, Warehouse receiving, Payroll,
Treasury)

Central  Non-disruptive implementation which


02 Operational ERP System Finance System allows to leave existing systems widely
unchanged, taking advantage from a
harmonized data environment that
supports financial reporting, planning
and standardized corporate processes
03 Operational ERP System
Frequently Asked Questions (FAQ) are
gathered in the SAP Note 2184567

S/4HANA 1809 – CoE Deck | 8th February 2019 © Capgemini 2019. All rights reserved | 29
S/4HANA Central Finance Overview
In a distributed landscape what a CFO wants?

Common
meaning of the
data model
across the
systems

Synthesis Language Centralization


 Statutory Reporting
 High level Managerial
Standardization
Reporting
 Chart of account  KPI and analytics
 Controlling model  Operative Reporting:
 Master Data Account Payable and
Single source Wording
Organization  Account Receivable
of truth
 Business  Centralized Process and
shared services
 Organizational
Structure and
organization

S/4HANA 1809 – CoE Deck | 8th February 2019 © Capgemini 2019. All rights reserved | 30
S/4HANA Central Finance Overview
Understanding the SAP S/4HANA Central Finance – Use Cases

 Platform and Playbook


(repeatable onboarding script)
for non-organic growth
Mergers & Acquisitions

 Cross-system SAP capabilities like


 Start moving away from credit, intercompany, treasury, shared
on premise installations services on can be consolidated on one
Central Finance instance

Move to the cloud Instance consolidation


Innovate now
 Consolidate, harmonize
data on the fly, update  Migrate and decommission
enterprise structures  Central Tax Reporting, selected existing SAP and
across SAP and non-SAP Central Project, Enhancement non-SAP ERP systems
ERP systems like Oracle, S/4 HANA 1809
PeopleSoft, or JD Edwards
SAP and non-SAP System consolidation

Competitor’s non-SAP and SAP Subsidiary onboarding

 Provide SAP value to  Platform to on-board


Competitor-only environments smaller entities or subsidiaries

S/4HANA 1809 – CoE Deck | 8th February 2019 © Capgemini 2019. All rights reserved | 31
Key Contacts

S/4HANA 1809 – CoE Deck | 8th February 2019 © Capgemini 2019. All rights reserved | 32
Key Contacts

Sergio Di Molfetta Giovanni Nigro Pietro Folonari Marilena Resta Alessandro Negro
Italy CoE Finance
Lead & Finance Expert Finance Expert Controlling Expert BI/BW Expert
Europe Finance
Offer Lead
sergio.dimolfetta@capgemini.com giovanni.nigro@capgemini.com pietro.folonari@capgemini.com marilena.resta@capgemini.com alessandro.negro@capgemini.com

+393428721761 +393402564833 +393440960422 +393483767122 +393428405229

S/4HANA 1809 – CoE Deck | 8th February 2019 © Capgemini 2019. All rights reserved | 33
About Capgemini
A global leader in consulting, technology services and digital transformation,
Capgemini is at the forefront of innovation to address the entire breadth of clients’
opportunities in the evolving world of cloud, digital and platforms. Building on its
strong 50-year heritage and deep industry-specific expertise, Capgemini enables
organizations to realize their business ambitions through an array of services from
strategy to operations. Capgemini is driven by the conviction that the business
value of technology comes from and through people. It is a multicultural company
of 200,000 team members in over 40 countries. The Group reported 2017 global
revenues of EUR 12.8 billion.

Learn more about us at

www.capgemini.com

This presentation contains information that may be privileged or confidential


and is the property of the Capgemini Group.
Copyright © 2019 Capgemini. All rights reserved.

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