Outlining the Integration Between FI and CO

Objectives

After completing this lesson, you will be able to:

  • Explain the integration between FI and CO

FI and CO Integration

SAP S/4HANA Finance - Simplified Data Model

FI is intended for legal reporting. It can be used to draw up a balance sheet and an income statement at the level of accounting entities.

The purpose of Management Accounting is to collect revenue and expenses by areas of responsibility to be used for internal management reporting purposes.

The level at which FI is needed is determined by law. Legal reporting is different for each country.

Management Accounting analyzes costs and revenues at high levels across country boundaries. For example, it can analyze costs for all production departments worldwide.

Costs and revenues from FI are used in Management Accounting. In Management Accounting, financial data can be allocated across several (FI) boundaries. The results in Management Accounting can be compared with the result in FI (reconciliation).

Management Accounting provides Controlling (CO) objects, which can represent areas of responsibilities that incur costs, revenues, or both, which allow an organization to track both costs and revenues internally.​

In SAP S/4HANA, Financial Accounting and Management Accounting use common line items for actual data, stored in a Universal Journal. The technical name of the table is ACDOCA.

The common line items provide the following:

  • A single source of truth for all accounting components:

    Reconciliation is a topic of the past bringing large cost and time savings.

  • A simple but holistic data model:

    SAP HANA can be leveraged in the best possible manner bringing unprecedented insight (in both speed and content).

  • The universal journal combines and harmonizes the good qualities of all accounting components:

    The simplification of the application is a required step and a great foundation for further enhancements.

  • Non-disruptive innovation and simplification:

    SAP strives to provide a true next generation application with the least possible disruption, safeguarding customer investments and processes

The data model of SAP S/4HANA Finance, has got the following benefits:

  • One line item table with full detail for all components.

  • Data is stored only once, so no reconciliation needed by architecture.

  • Fast multi-dimensional reporting on the Universal Journal is possible without replicating data to Business Intelligence (BI). If BI is in place, one single BI extractor is needed.

  • Reduction of memory footprint through elimination of redundancy.

  • Technical preparation is done to enhance important structural capabilities of the Financials solution (for example, multi-GAAP, additional currencies).

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