SAP S/4HANA Finance: A Comprehensive Overview

This report delves into the intricacies of SAP S/4HANA Finance, a powerful financial management tool designed to streamline business operations and enhance decision-making. It explores the historical evolution of SAP S/4HANA Finance, highlighting its key features and benefits. The report also differentiates SAP S/4HANA Finance from its predecessor, SAP ERP FICO, and examines real-world case studies of companies that have successfully implemented this solution. By analyzing the challenges faced during the transition and the strategies employed to overcome them, this report provides valuable insights for organizations considering adopting SAP S/4HANA Finance.

BAO6714 COMPUTERISED ACCOUNTING
IN AN ERP ASSIGNMENT
Student Name:
Student Number:
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Contents
Introduction.................................................................................................................................................3
Section C.....................................................................................................................................................4
1. A brief historical overview of SAP S/4 HANA finance.......................................................................4
2. Differentiate between SAP S/4HANA Finance and current SAP ERP FICO......................................7
3. Explain benefits of SAP S/4HANA Finance for business....................................................................9
4. Case studies of companies and the issue that were faced while mitigating to SAP S/4 HANA
Finance..................................................................................................................................................12
Conclusion.................................................................................................................................................15
Bibliography...............................................................................................................................................16
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Introduction
This report consists of the study on the tool of the ERP system which is SAP S/4 finance. It a
financial tool that uses to solve all the financial implications attached with the company like,
journal, ledger, and reconciliation statements it provides a database of HANA which is user
friendly, accurate, flexible and provides solution to all the financial problems rapidly. This
system is used by various large organizations to not only solve their particular issues of the
financial problems but it also lesson the burden of the CFO by a visionary plan layout that could
help in their decision making. The Deloitte and KPMG have used this approach to help their
system in financial planning and the management. They just made a report that would guide a
hundred of employees and finance professionals to how they can utilize their energies by the use
of this approach. The user friendly techniques always provide accurate results. The Evolution of
SAP S/4 finance has been discussed with the case study of the KPMG, it was suggested to their
employees to use this approach, and various systems of SAP are discussed in this report.
According to its study the evolution of SAP was considered in 1972.
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Section C
1. A brief historical overview of SAP S/4 HANA finance
The SAP S/4 HANA finance is a financial solution to all the business organizations running with
the new technology (Günter, 2017). It is one of the tools of the ERP management. It is one of the
finance providing solution to the business enterprise. It facilitates the business organizations to
correlate the operational and financial functions and thereby enhancing the flexibility, accuracy,
forecasting of all the transactions of the company, as well as provide automatic update, back up
features and financial reporting and evaluation features that improves the quality of financial
reporting.
It also provides the business models a risk cover and is made to fit for the use in the offices of
the CFO. The popular big companies that are using this tool is Deloitte, KPMG, E&Y, Wipro
and many more large organizations (Günter, 2017).
An overview of SAP S/4 HANA its brief history
According to the case study of KPMG report on the SAP marketing trends which increases
the value of S/4 HANA finance.
Long back in 1972 the concept of SAP was emerged into the market. The first product of SAP
was launched in the market as (R/1) also known with the name one tier system. In 1979 the
launch of (R/2) with the feature three layers ERP system and the introduction of (R/3) in a year
1992 a customer friendly system it also produce the IDOC/ALE methods of processing. It is
more users friendly.
Since the beginning of the 2012 the R/3 is considered as the most innovative and the best product
in the history of SAP management which has changed with the upcoming product called the
HANA a new version in the business suite, it uses the latest technology it used to perform
calculations and it is in memory form (Limited, 2018). HANA uses the single sheet of data to
interpret the results before that the traditional method uses the 3 sheet of database which
facilitates the duplication of the work. It uses single approach of database against the transactions
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of OTLP and OLAP (online transactions processing. It was found that since 1511 or 2015
November the set up of the logistics module on the database of S/4 HANA finance, which brings
more quality and innovation in the technologies and other things.
In 2016 HANA2 has launched this version provides the other functions on HANA database like
more flexibility, transparency in the third party transactions, more accuracy.
The SAP business suite consist of the HANA as the database also called as the S/4 HANA
database runs on the principle of HANA database .ECC found to be the first solution to all the
business suits; it runs on the principle of HANA user database which facilitates suite solutions to
all the business enterprise and their activity (Ghattamneni, 2016). The all business suite run on
the application of HANA known as S/4 HANA enterprise management all the applications run
on the principle of HANA database.
The things that increases the value of the S/4HANA
1. The performance of the HANA DB.
2. Reorganization of the existing processes.
3. Adoption of the functions of S/4 HANA
4. A leverage on the S/4 HANA
5. Conduction of the user friendly principles.
6. Implementing new principles and the innovations
7. Correlating with other business enterprise networks.
Scope of the S/4 HANA finance are
It provides the user friendly solutions to the business enterprise with the modern technology
framework. It reduced the efforts made on the reconciliation statements as well as reducing the
task of reconciliation by a single use of journal (Necas, 2016). It made easy to know the correct
valuation for acquiring and selling the assets and acquisition, made easy policy in disposal and
depreciation of the assets, made an easy access to the financial planning and other things (Necas,
2016).
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Case study of Deloitte on S/4 HANA finance
This study provides an introduction on SAP S/4 finance to the finance professionals it describes
the (in memory) built feature which allows a accurate information it used to integrate all the
sales, finance as well as marketing activities (Huurinainen, 2018). It simplifies the data and has
the multitasking capacity and the other functions by the use of this S/4 HANA finance.
The case study of Deloitte on creating value of CFO through the S/4 HANA finance
The finance sector has been fighting with many tax and other complications in the field of
finance and other operations department, the S/4 HANA provides a solution to that (Günter,
2017). The S/4 HANA provide the future solutions to the business, it provides the value driving
techniques that uses the innovations and technology and it also builds the understanding towards
the S/4 HANA it makes the complicated study to the conceptual study with the use of HANA as
the database. It further adds a solution to all the technical problems and also defines the vision of
the CFO by a visionary roadmap of the entire financial plan to an organization. It also provides
the rapid solutions to all the problems of financial and technical issues (Fujitsu, 2018).
So, at lasts the S/4 HANA tries to unite all the financial implications and all the data interference
with the HANA database which provides solution to the entire problems of business organization
and address very rapidly, flexible and more accurately. So, thereby increasing the role of finance
and SAP accountant professionals which lesson all the burden of the CFO.
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2. Differentiate between SAP S/4HANA Finance and current SAP ERP FICO.
SAP S/4HANA Finance is the management tool which is used in the organization so as to
embrace the digital age with the innovative and the new business models so that the proper
insight can be provided to the decision makers. With the use of SAP S/4HANA Finance, the
organizations can get the view about all the operational and the financial data and also provides
the flexibility in reporting which is consumable reporting (Hyyryläinen, 2017). It also evaluates
the financial implications with the real time analytics of the options which are of business. These
are designed so as to remove the boundaries about analytical, transaction as well as the planning
systems so that the analysis can easily be done of all the available financial data (Hyyryläinen,
2017).
The SAP FICO stands for the financial accounting and controlling. It is the process which is
designed for the external as well as the internal process. In this the financial transactions are
integrated with the different other SAP model so that the best results can be provided to the
managers of the organization. It is believed as one of the difficult method for recording the
financial transactions and is best suited for the professionals who have expertise in the finance
and accounts field. It basically lays the emphasis on the internal factors rather than the external
factors so that all the diverse modules can be integrated to the single module.
Difference between both
There occurs the slight difference between the SAP S/4HANA and the SAP FICO which can be
determined in the particular way. SAP FICO is the important module through which the financial
data is stored in the accounts while the SAP HANA is the simple financial solution based on the
SAP HANA through which the deployment can be done in the premise and the cloud. Before the
transactional financial reporting the reporting does not had any of the limited boundaries by the
application. But once the implementation of the SAP S/4HANA financials the process for the
reporting of the management was improved and the decisions were taken accordingly (Günter,
2017). The package of the S/4HANA includes the various factors which help in differentiating
the one with another one. It includes the accounting in the simplified form such as the general
ledger, the accounting of new asset and the account based CO PA. With this the tool also enabled
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the authorization through which the enhancement of the product can be done (Chuprunov, 2018).
Due to improvement in the technology the HANA provided the real time based reporting which
enabled the managers of the organization in taking the decisions accordingly. The HANA
finance rather than that of the ERP improved the performance as the business planning was
integrated within the organization. The SAP FICO does not report the real time picture of the
accounting financials which led to the difficulties while analyzing the financial statements
(Günter, 2017). Through this the FICO was used for the controlling of the errors in the financial
accounts but the S/4HANA also used the planning which is integrated within the software. This
also provided the next generation user experience through the improvement in the financial
reporting standards. The S/4HANA also provided the opportunity for creating the SAP HANA
views with the tables, index and the other items. The new table was also created for the new
journal so that the assets and the liabilities can easily be recorded in the journal entry (Günter,
2017). The main aim of the SAP S/4HANA is at the professionals and the experts of the
industries so that the compliance can be reduced in the treasury, tax as well as the law activities.
While the aim of the SAP FICO is to provide the best performance results so that the wrong
results can easily be avoided in the financial accounts. The SAP FI includes the various modules
through which the financial statements for the future can be analyzed. Accounts receivable,
accounts payables and the assets and the bank accounting are the modules which are included in
the reporting of the statements (Limited, 2018).
With this there is one more difference in the SAP FICO and the SAP S/4HANA through which
the reporting of both the system can be evaluated and analyzed. It can be seen through the SAP
FICO the financial transaction results were not accurate at the end of trading accounting period
but when the improvements were made the quality for the product has been enhanced and
improved (Missbach, 2016). With this if the differentiation is done on the basis of the reporting
so it can be seen that the reporting of the S/4HANA was the simplest process but in case of the
SAP FICO there was the complex process for the reporting of the financial transactions. So,
these are the major differences between both the systems which can be said that are the slight
difference instead of the major one as both are the financials of the SAP system (Günter, 2017).
The finance follows the process of reconciliation which is faster which will provide the truth
about the finances of organization as the whole so that the operations of the business can run
smoothly and the clear and the true picture about the financial transactions can be provided.
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3. Explain benefits of SAP S/4HANA Finance for business.
The implementation of the SAP S/4HANA provided various benefits to the users as well as the
organizations as it enhanced the working of organizations through the improvement in current
procedures. The business management software is the enterprise resource planning which is used
in the organizations so that the development and the planning for the reporting of transactions
can easily be done. The ERP software manages the SAP S4 HNA Finance as it is one of the
technological advancement software (Hyyryläinen, 2017). The SAP S4 HANA provides the
benefits to the business through its features. The features and the functions of software are easy
which will provide them the easy process through which the ERP systems of the organization
can be managed and evaluated. The first advantage which can be provided is that it combines the
features of the ERO system with that of Financial and management accounting data so that the
integration be maintained within the organization. It also provides the real time data through
which the reconciliation and the closing of the financial transactions can be done easily. With
this it also have the benefit such as it provides the ability so that the batch bottlenecks can be
eliminated and the reconciliation of the continuous intercompany can be made. With this the
system also provides various benefits which will help in enhancing the performance of
organization through the improvement in working condition of the organization (Hyyryläinen,
2017). The following are the benefits of SAP S4 HANA Finance:
Empowers business to maximize the opportunities of new emerging technologies:
The implementation of the SAP S4 HANA empowers the business opportunities for the business
by providing the new technologies so that digitalized platform can be provided to the
organization and the enhancement in technologies and the transactions can be made (Günter,
2017). It also provides the business the improvements so that the emerging technologies which
are used in the business can be replaced with the new one and the decisions can be enhanced
which will lead the organization to achieve success. This also helps in providing business the
opportunities through which the more challenges can be faced by the organizations and the work
for the same can be dine accordingly so that the overall benefit of the organization can be
enhanced (Chuprunov, 2018).
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Access to real time information to support decision making:
Though the SAP S4 HANA the insight can be provided that real time access can be done to all
the results as well as the data which will help the managers of the organization in taking the
proper decisions related to the organization so that the planning can be done accordingly and the
forecasting related to future can be made (Missbach, 2016). The real time results also slows the
managers of the organization to solve the issue at the particular time without any delay so that
the overall profitability of the organization cannot get impacted and the areas where the
improvements are necessary can be considered so that the solution for same can be provided at
that particular point of time. The real time results can also help in maintaing the transparency
within the organizational structure and will also help in maintaing the accountability within
organization (Huurinainen, 2018).
Efficient collaboration:
This is the application which is developed so as the user satisfaction of the employees can be
increased and the user friendly services can be provided to the customers of the organization.
This application will enable the opportunity for the users so that the modernized and the new
ways of working can be experienced by them. This also increased the productivity among the
users of SAP S4 HANA by 30% in the IT as well as the business sectors (Missbach, 2016). The
results showed that there is the great efficiency in the business and the user friendly feature is
enabling more customers to switch from the earlier version to the updated one.
Increased Productivity:
With the implementation the new system the productivity within the organization is also
increased. The system provides the tangible benefits to the users so there seemed to be the 25%
of improvement in the fulfillment of order. There was also the reduction in the errors rates of the
manufactures which was approximately about 20%. With this the supply chain has improved to
the 12% with the decrease in the cost of procurement (Missbach, 2016). This data showed the
positive results as the users enabled the business to access the data anytime with the real time
results which enabled the transparency and with the change in the business environment as it also
reduced the workload of the customers which was manual (Missbach, 2016).
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IT Cost Savings:
The implementation of the system reduced the cost as only one time investment have to be done
for the investment of the software and the overlapping of data can also be reduced. It has also
optimized the volume of data through the removal of parallel and the data which is of no use so
that the enhancement can be done and cost savings can be provided to the customers of the
organization (Missbach, 2016).
Increased Efficiency:
The efficiency has been increased through the automation of the techniques in the use business
processes. The combination of simplicity and innovation the productivity can be boosted and the
errors can be reduced (Hyyryläinen, 2017). The reduction in the errors will help in enhancing the
efficiency within organization which in turn will help the organization in providing the better
results for future. With the improvement in efficiency of business the decisions of the
organizations will include the policies for reducing the cost and increasing the profits of
organization (Huurinainen, 2018).
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4. Case studies of companies and the issue that were faced while mitigating to SAP S/4
HANA Finance.
There were various issues that were faced by the organizations with the implementation of SAP
S/4 HANA Finance as it was the process which has aimed towards the successful creation of
technologies in the digital way. Not only one of the company was integrated which faced the
issues with mitigation but there are other companies also who faced the issues. The case studies
of the Fujitsu and HCL Technologies (Fujitsu, 2018). With this challenge the organizations also
provided the solution due to which the challenges which are faced by the organizations were
reduced and the efficiency as well as the effectiveness in the organization can be increased. The
issues that were faced by the companies are:
Fujitsu Case Study:
The Fujitsu case study showed various challenges that were faced by the organization with the
adoption of the new system of reporting and analyzing the transactions. The first challenge
which was faced was that the fundamental shift with the result of digitization which enabled the
data flows to become more agile. With this the challenge was that the employees and the
organization was not used to the new environment so they faced the problems while using the
new system in the organization (Fujitsu, 2018). They hinders the consistency of the processes
and as they failed to manage the information and the processes of separate silos. With this there
were more issues such as the shadow process have been established in the organization which led
to the change in the business processes but the implementation of that system was bit difficult
one. There were more of the complexities particularly at the reporting level (Fujitsu, 2018). To
solve this problem the new regulations were established which helps in increasing the legal
requirements which are for reporting (Fujitsu, 2018). With the growth in the volumes of data
company found various difficulties for evaluating and analyzing the data and this in turn made
the report preparation more difficult as the results are not analyzed properly (Fujitsu, 2018).
HCL Technologies:
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This is another case study of the HCL Technologies which also faced the problems while
adopting the new technology of SAP S/4 HANA Finance (Limited, 2018). The problems which
was basically faced by the organization which can be better explained through the graph below:
Image: Challenges in adoption of S/4 HANA
Source: HCL Technologies, 2018
These are the challenges which were faced by the organization. The first one was that there was
the cost of development which seems to be high so the process for developing the whole process
seemed to be the biggest challenged that was faced by the HCL Technologies (Limited, 2018).
With this the constraints of the resources was also one of the challenge that was seen by the
organization as the resources were limited and the adoption of the new system requires much of
the resources. The lack of skills among the employees who are working was also seen that earlier
the employees are used to of the version which was used earlier and that seemed to be the easiest
process and they are habitual of using that software. So, the adoption of the new one faced the
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challenge of skills as the employees were not aware that how to use that system which also
decreased the effectiveness and efficiency in reporting. The high risk of the business disruption
was also seemed to be the challenge which seemed to be the biggest one as there was lack of
analysis and the evaluating in the business processes so the results also were not clear which
showed that the risk is high for the business in the competitive market (Limited, 2018).
The organization responds to the challenges which were faced by the adoption of SAP S/4
HANA. They removed all the obstacles that led to the delay in the adoption of new system. For
removing this hurdle the organization mainly focuses on the decision makers to that the non
disruptive path for the mitigation can be adopted which will help in understanding the risk and
impact of risk to the organization (Günter, 2017). This will also help in integrating the
development with that of the transformation strategy through the digital transformation. This
decision will also help in providing the answers for some of the critical questions which may
delay the better commitment to the hurdle which have been occurred due to the roadmap. This
will also enable the implementation of the product beyond the monitoring and evaluation of the
benefits that will be generated through for providing the nest results to the clients (Ghattamneni,
2016).
These are the two cases through which the clear view about the challenges that were faced by the
organization whiles the implementation of the SAP S/4 HANA. There were various challenges
that were faced but with that the company also provided the possible respond to all the
challenges so that the overall effectiveness can be attained and the better results can be provided
to the customers which will enable them in taking the best possible decisions (Chuprunov, 2018).
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Conclusion
This report was build to provide learning for the functions and principles of the SAP S/4 HANA
finance a solution to all the finance problems to all the business models. The use of this method
makes accurate, flexible and more reliable the task. The purpose of this technology is to lessen
the burden of the finance professionals and the other management staff. The role of CFO is very
high in comparing with the complexities of the financial implication so, here comes the HANA
which provides solution to the CFO in providing all the solutions. The SAP was evolved in the
late 1972 after this there come a lot of versions of the SAP which comes and goes with the new
innovation and the great technology. The large companies like Deloitte and the KPMG use this
technology to ensure their clients a good and better feedback. So, like these companies using the
technology of SAP every large company should use this technology in order to get better
functioning in the ledger and the accounts, it facilitates the quick reconciliation of the bank
accounts, maintains the ledger, removes the errors and moreover it works on the single sheet of
data interpretation which removes all the complexities of the duplication.
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