Learn how to set up the new Asset Accounting functionality (FI-AA) in SAP S/4HANA Finance in a parallel reporting scenario with differing fiscal year variants.
Reading this article, you’ll learn:
How the real-time integration between General Ledger Accounting (FI-GL) and Asset Accounting (FI-AA) in SAP S/4HANA forces a different kind of setup for the ledgers
The unified data model and real-time integration between General Ledger Accounting (FI-GL) and Asset Accounting (FI-AA) force the fiscal year variants from the leading and non-leading ledgers onto the depreciation areas.
SAP S/4HANA Finance offers an integrated and unified data model in Finance between the SAP General Ledger Accounting (FI-GL) and Asset Accounting (FI-AA). It offers many benefits to users, especially the real-time reconciled ledgers (the main ledger and asset sub-ledger).
However, the new features of SAP S/4HANA Finance also significantly change how the new FI-AA module must be set up in a parallel reporting scenario (for example, local reporting and group reporting, where the local company and parent companies follow different reporting periods).
Consider a scenario that represents a practical real-life scenario for many organizations. ABC Inc. USA follows International Financial Reporting Standards (IFRS) reporting standards and Jan-Dec as the fiscal reporting period. It has a subsidiary company in India (represented by company code 9999 in our example) that has to follow Apr-Mar as the fiscal reporting period to comply with local laws. As such, company code 9999 follows parallel accounting in SAP S/4HANA Finance, using a ledger approach.
Setting Up the Scenario in Classic FI-AA as of ECC 6.0
To set up the above scenario in classic FI-AA as of SAP ERP Central Component (ECC) 6.0, you would do the following customizing in your SAP system, as shown in Table 1.
In our scenario, you would assign the leading ledger (0L) and a non-leading ledger (2L), with fiscal year variants as V3 and K4, respectively, to the company code 9999. (The steps for this configuration in ECC are not part of the scope of this article). Using the ledger 0L, company code 9999 would be reporting as per local laws (i.e., Apr-Mar) and with the ledger 2L, it would report as per the group reporting norms (i.e., Jan-Dec).
The leading ledger 0L is assigned to the Depreciation Area 01 and the non-leading ledger 2L is assigned to the Depreciation Area 02. However, you don’t have to assign a fiscal year variant specifically to the depreciation areas, as the asset accounting derives the fiscal year variant from the leading ledger. It must be noted that the fiscal year start and end date must be same for all depreciation areas in asset accounting.
Setting Up the Scenario in New FI-AA in SAP S/4HANA Finance
For the same scenario, you cannot manage it the same way in SAP S/4HANA Finance as in classic FI-AA. Let’s find out why.
Ajay Maheshwari is an SAP Finance and Controlling (FI/CO) and SAP S4/HANA solution architect with more than 13 years of experience. He is well known for his contributions to the SAP Community Network (SCN) Forum.
He is among the all-time top 20 contributors to the SCN Forum, across all SAP modules and one of the top contributors in his own space, SAP FI/CO.
He is one of the official SAP mentors and has been recognized as the topic leader in the SCN Forum each year since 2011.
He has experience with SAP implementations and rollouts in several industries and thoroughly enjoys designing complex business processes and delivering SAP training in the areas of FI/CO and SAP S/4HANA.
Currently, he works as associate director at itelligence, an SAP Platinum Partner.
Kavita Agarwal is an SAP FI/CO and SAP S/4HANA solution architect with more than 16 years of experience. She is well known for her contributions to the SAP Community Network (SCN) Forum and is a platinum level contributor there.
She has experience with medium- to large-sized SAP implementations and rollouts in several industries and geographies and has been part of major finance transformation programs in the chocolates and confectionary industry. She enjoys designing complex business processes and delivering SAP training in the areas of SAP FI and SAP S/4HANA.
Currently, she works as an independent consultant helping customers optimize their SAP systems to derive maximum benefits out of their SAP investments and also offers e-learning solutions in SAP FI/CO.