What makes financial accounting in SAP S/4HANA Cloud Public Edition stand out

SAP S/4HANA Cloud Public Edition offers companies the opportunity to modernize their financial management and access ready-to-use financial processes. Compared to SAP ERP, one visual change is immediately apparent: the user interface in SAP S/4HANA Cloud Public Edition is designed in SAP Fiori style and differs significantly from the previous SAP GUI interface. In SAP Fiori, the various financial accounting functionalities are executed by using applications. Users can save individual applications as favorites on the start screen. In addition, the most frequently used, most recently used, and recommended apps are displayed.

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Typical activities in financial accounting

Financial accounting is essentially based on four pillars: the general ledger (FI-GL) and the subledgers for accounts payable (FI-AP), accounts receivable (FI-AR), and asset accounting (FI-AA). Here, SAP S/4HANA Cloud Public Edition offers various options for entering documents. The following section outlines an example of a posting from each of the four areas.

Enter G/L document (FI-GL)

G/L documents are entered in the “Post General Journal Entry” application. The input screen is similar to the old FB50 transaction and includes a document header with the most important information about the document. Accounts are available for posting via the prepared SAP standard chart of accounts YCOA. After data entry, the system checks whether all fields required for the posting have been filled in. As in the on-premise world, it is also possible to simulate a posting in advance in SAP S/4HANA Cloud Public Edition. The actual posting can then also be made directly from the “Post General Journal Entry” application.

Post outgoing invoice (FI-AR)

Another example of a common scenario is posting an outgoing invoice in SAP FI (Financial Accounting) if it is not transferred from the Sales module. The appropriate application is called “Create Outgoing Invoice” and is based on the classic SAP GUI transaction. Information such as the document type, amount, tax calculation, and G/L account must be entered in the input mask. This posting can also be simulated before execution and is finally carried out after verification.

Manage Fixed Assets (FI-AA)

“Manage Fixed Assets” is a new application in SAP S/4HANA Cloud Public Edition and can be described as a combination of the Asset Explorer (FI-AA) and transactions AS01 to AS03. Users can create a new asset in the application or display existing assets. When creating an asset, the company code and asset class must first be selected. The system assigns an interim number that remains valid until the document is saved or discarded. As a standard SAP functionality, the profit center can be derived from the cost center. The cost center is required for depreciation to function. A special exception applies if project control – financial accounting is active in the system and has been set up accordingly. The system then generates default values for the ledgers and depreciation keys. However, these default values can also be changed, as in the on-premise version of SAP S/4HANA. After clicking “Create,” the system creates the asset master record, whereby the interim number becomes a fixed asset number.

Create supplier invoice (FI-AP)

In our example, the asset is now to be capitalized from a supplier invoice without a purchase order reference. This step is performed in the “Create Supplier Invoice” application. In the “Asset Item” section, the user selects the asset to which the entry is to be posted. After the invoice has been successfully checked and the posting made, the posted values are visible in the overview.

The documents appear under “Journal Entries” with a financial accounting number, and the transaction type and line item type are also visible. There is also the option of a depreciation preview, and different valuation areas can be compared with each other. It is possible to work with different accounting regulations.

The “Manage Fixed Assets” application offers a direct link to display the document flow. The new “Display Document Flow – Journal Entry” application is available for this purpose. The document flow is displayed on two levels: as an operational document flow and as a G/L document flow.

The postings can also be displayed as T-accounts specific to the ledger.

Predefined or customizable? Chart of accounts in SAP S/4HANA Cloud Public Edition

Since SAP S/4HANA Cloud Public Edition is a standardized system, the chart of accounts is delivered predefined. However, it is possible to extend the chart of accounts or develop a customized chart of accounts. To do this, the accounts can be renumbered after a corresponding mapping has been maintained.

This means that internal company account logic can also be mapped under YCOA. In this context, however, it is important to make the adjustments during the conceptual phase, as this option is only available as long as there are no postings on the accounts in the production system.