Computerized Accounting in an ERP System with SAP S/4HANA Finance

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Computerized Accounting in an ERP System.
SAP S/4 HANA Finance
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Computerized Accounting in an ERP System.
SAP S/4HANA Finance
Introduction
A computerized accounting system is the use of computer and the specialized software in
carrying out accounting practices. These systems have levied many advantages in business
organisations by out doing the tedious manual accounting practices experienced in the past (De
Gorostiza et al., 2018, pp.50-64). However, an Enterprise Resource Planning (ERP) is a
software module integrated into the computerized accounting with the ability to synchronize
reports and automation. This implies that the employees in an organization do not have to
maintain separate databases and the spreadsheets in order to generate reports but rather enables
the employees to put extract reports from a single system (Sheldon, 2018, pp.49-56). These
Enterprise Resource Planning tools include Oracle, SAP, Sage, Microsoft Dynamics, and
NetSuite among others. In the past, the accounting systems were used majorly track daily
transactions in order to provide monthly or annual financial reports. However, with the changing
business models and the bulky market demands, companies need more information that is vital in
making good decisions. This has made the accounting systems to be useful for both managerial
accounting and the financial accounting (Duska, Ronald, and Brenda, 2018). The small
accounting packages such as the Peachtree and QuickBooks provided features that were
important for managerial accounting. In this report, we will focus on the use of SAP S/HANA
Finance software, which is an advanced ERP tool that is being implemented by most
organisations in the subsequent sections of the report.

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Statement of purpose (brief description of the report structure)
The purpose of this report is to explain the challenges facing the financial accounting and
analysis in different organizations and the remedies that can be brought about by the use of
powerful financial accounting software. The SAP S/HANA Finance software is chosen for this
report in addressing the challenges faced by the Chief Financial Officers in relation to the
previous systems used for financial accounting (Asprion, Peter, and Bettina, 2018, pp.15-29).
The report is also aimed at encouraging organisations to implement the use of the SAP S/HANA
Finance software in financial planning and forecasting using the two case studies and the benefits
that have been brought about by the use of the software in the case study scenarios.
Report structure
The report will be structured into different sections including a historical overview of the
SAP S/HANA Finance, the differences between this software and the current SAP ERP FICO,
and the benefits that are brought along with the use of the software in finance. Additionally, the
report will utilize the use of the two case studies to bring out the practical advantages and
improvements to the companies that have been brought up by the use of the SAP S/HANA
Finance software. The report will then draw conclusions and recommendations based on the
historical overview of the software and the case studies explored in the report.
An overview of SAP S/4HANA Finance
This was formally known as the SAP Simple Finance, which includes components that
facilitate the real-time analytics, universal journal, and streamlined design (Kraljic and Kraljic,
2018, pp.190-201). However, a module of the SAP Asset Accounting is redesigned in the
S/4HANA to boost the effectiveness through the asset life-cycle. Since the announcement of
SAP S/4HANA in 2014 by SAP, there has been a lot of misunderstanding of what the new

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product was all about among the different new users. Moreover, reports indicated that most users
viewed it as a Financial Accounting and Controlling (SAP FICO) aimed at replacing the ERP
suite due to its simplicity in configuration. To counter for this confusion among the users, this
report puts into account the historical development of the SAP S/4HANA and the understanding
of how it came into use until today (Kusters et al., 2018).
To begin with, it is import to understand what the SAP S/4HANA is. The SAP Simple
Finance (version 1.0) released in 2014 was an add-on to SAP HANA that was an advanced
version of the Financial Accounting module in the SAP Business Suite. However, the improved
model of the software, the SAP Simple Finance 2.0 was released in 2015 as a redesigned
successor of the SAP Simple Finance 1.0. Moreover, from September 2015, the term SAP
Simple Finance was replaced with SAP S/4HANA Finance with a series of continual
improvement to the software. Since the SAP S4/HANA is part of the S/4HANA suite, we will
outline the four components consisting of the SAP S/4HANA (Reisert, Corinne, and Sarah,
2018, pp.21-36).
The first functional or core component of this software is the SAP which provides a
number of the different finance capabilities and enhancements that have been developed since
2015. This component requires that for it to function, you need to incorporate the SAP Net
Weaver 7.4, SAP HANA 1.0, and the SAP ERP Central Component (ECC) 6.0 in order to
initiate an upgrade to S4HANA. Another key component is the user experience (UX) or the
presentation component. According to (Konstantakis et al., 2018), this component was based on
SAP Fiori that enables the user to use the core components through the Fiori screens that are
user-friendly. This mandatory component must be accompanied by for the operation of the SAP
GUI with the Gateway Version 2.0 and the SAP Net Weaver 7.4. Another component is the