Name: Exploring Cost Settlement in Contract and Lease Management in SAP S4/HANA Cloud Public Edition – PET 2026
Uploaded: 2026-6-17
Duration: 1065 s

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<div><div><div>SAP Business Suite Product Expert Training (PET) H1 2026 / Finance and risk / SAP Cloud ERP / SAP S/4HANA Cloud Public Edition / Contract and Lease Management <br><br>Discover the new Cost Settlement capabilities in Contract and Lease Management for SAP S/4HANA Cloud Public Edition. In this session, you will learn how the simplified cost settlement process helps organizations collect, classify, and allocate real estate-related costs while decoupling operational and financial processes. Through a system demonstration, the session showcases key innovations including service groups, settlement regulations, journal entry classification, and cost settlement simulation, providing greater transparency and efficiency in managing real estate accounting and tenant cost allocations.<br><br>Ask your questions in our <a target="_blank" rel="nofollow noopener noreferrer" href="https://community.sap.com/t5/enterprise-resource-planning-q-a/qa-p/erp-questions">community</a> using the PET_Enablement tag under “Question User Tags.”<br><br>Here is the <a target="_blank" rel="nofollow noopener noreferrer" href="https://d.dam.sap.com/a/QaUifJF/Exploring_Cost_Settlement.pdf?rc=10&inline=true&doi=SAP1321220">slide deck</a>.<br><br>Please note that captions have not been edited.</div></div></div>

Exploring Cost Settlement in Contract and Lease Management in SAP S4/HANA Cloud Public Edition – PET 2026

Hello and welcome to today's product expert training for the features of the first half of 2026. Today, you will learn about subcontract and lease management and the new cost settlement feature. Please carefully read our disclaimer. My name is Norman Weigel and I am product manager for subcontract lease and real estate management. And subcontract and lease management belongs to managed real estate, which you can see here on the slide. Today I will first give you an introduction to contract and lease management in general. Afterwards I will explain the new cost settlement feature and the business process and afterwards I will show you the new feature in our system demo. Subcontract and lease management belongs to the subbusiness suite. So we are part of the cloud ERP. In addition to the contract management part we also have our product from our partner Planon which is sub-real estate and facilities management by Planon. So this product consists of these four main areas, the real estate management for the general portfolio management, the space and workplace services management, for managing meeting rooms and desks, asset and maintenance management, for the management of all the equipments in the building, and the energy and sustainability management to keep track of your building and its CO2 emissions. In addition to that, in the Cloud ERP, we have, of course, the contract management part, which is core for our real estate accounting so this enables the whole accounting processes for real estate. With this product we are compliant with all the accounting standards globally like IFRS or HGV. In addition to that of course we have data products so that we can also report our data in the business data cloud. Let's start with contract and lease management in general So with contract and lease management in general, we're focusing on the whole contract lifecycle. That means from the part of the contract negotiation over the execution administration, the compliance, like I mentioned before, with RFL 16, and of course, the contract closeout or renewal. On the other hand side, one important pillar is integration to the asset accounting for the financials. So with contract management, we have deep integration to the asset accounting that is, for instance, for the valuation of your real estate and the right of use asset calculation. Now let's talk about the new cost settlement process. In the public cloud, we have simplified the cost settlement process and we have decoupled the real estate operations from the financial operations. So you can see here the master data that is relevant for the cost settlement process. So we need the architecture objects, which we get from our solution extension by planon. We need to have the usable objects, which enable our buildings for accounting processes. We have our rentable objects, so that's the actual lease out to our tenants. Of course, we have the contracts that then contain all the conditions that we need for the postings. And we have our service groups. This is the new master data object for the cost settlement process. So where can this data come from that we need for the cost settlement? so like the financial postings. So this could for instance be an invoice by the central invoice management. It could be in general journal entries that are posted. It could be allocation of internal cost. This could be for instance for the usage of meeting rooms or for booking of additional things like drinks for meetings. And of course we could have partner postings. So all this data now flows into the process for cost settlement so first step is that we collect these postings the financial postings and the next step we need to classify those journal entries so in general we here need a couple of journal entries that we can configure for our cost categories so that we can make the classification of the cost according to the journal entries. So when the cost is posted to the cost center or to in general to a cost object here it's mentioned accounting objects that are supported so this is the cost center but also a project controlling object. It can also be different from the building cost center and it first just collects the cost and with the gl account and the postings to the cost center we can then classify the journal entry so in this step we can check if the classification was correct based on the configuration above so where we make an assignment of the gl account to the cost category category we can derive already the cost category but if there are changes necessary then we have application which i will show you later that can take over this step as the next step of the whole cost settlement process we have the simulation with the simulation you can already check what would be the result of the cost settlement itself you can see the distribution of the cost to the different areas or rentable units and at the end you can execute the the cost settlement which will then make the postings accordingly. For the future, we are also looking into topics like AI, like it's already supported in the central invoice management process in order to also enable the classification for postings which cannot be derived just on rules. Now looking into the delivery of 2602. What is now available in a cost settlement process? So we have, first of all, our managed service groups. So this is the point where we bring everything together as the configuration. So here we will have our architecture objects, we will have the accounting object that is relevant for the service group in order to collect the cost. And we also decide based on which rules the cost settlement will be calculated. I will show this later in the system. The next step is the managed contract settlement regulations. So we will automatically, based on the areas used in a service group or basically the architecture objects that are used in a service group, we can derive the rentable units and the contracts that are relevant for these rentable units. And with this app, we can add additional regulations that are contract-specific. In the step before I mentioned, on the slide before, I mentioned to classify journal entries for real estate settlement. So here we can do the check of the postings if they are allocated to the correct cost categories. And in the next step, in a process cost settlement step, we can simulate the cost settlement run and can check the data up front. with the next plan delivery 2608 we will enable further steps for the cost settlement process like the actual posting the correspondence and the advanced payment for cost settlement how does this look like now in the overall process so we start with the cost settlement preparation like where we first define our service group make the assignment of the space that participates in a cost settlement we assign the cost categories that are relevant for the service group and we assign the settlement regulations as well as the accounting objects in the next step we can then also create the contract regulations so these are derived automatically and we just need to make the assignment of the regulation in the second step we classify the journal entries that means like we are receiving for instance the cost from a supplier invoice and then we can review this cost in a way that first of all of course we review and process the invoice we post then the invoice to the corresponding for instance cost center general accounting object and the GL account which collects the cost that can be transferred to the tenants and as a last step then we classify the journal entries or in general we check it and do the classification if necessary. In a third step we process the cost settlement that means we have the over cost settlement process so we determine the settlement hierarchy the reference factors and we calculate the distribution or not we do it the system does it and at the end we can check the simulation or the results of the simulation of the distribution to our tenants all right this is now our public cloud system and here we have these new applications available the managed service group the classified journal entry items for real estate settlement and the display results of cost settlement process steps. Let's start with the managed service groups. So I just take a look at all the service groups that are available and we can see already here in the service groups that we have prepared that with the service group we define which spaces participate in a cost settlement process. In this example we have prepared it that there's a part of the cost that is relevant for the entire building so every user of the building will participate in a cost and then there is a part here it's the elevator maintenance so only the upper floor so the ground floor does not participate in this cost let's go into the details for the service group so in the service group we have of course the general information the name of the service group and the start and the end date we have the object participation so as this is for the entire building we can see here that the building will participate for for the cost that is collected under the service group or for the cost settlement at this process that is relevant for the service group and we have the accounting object so here we can see the cost center and we can also add additional cost objects but this is more for a later process and then we can see the settlement regulations so here it's then for the usable area the denominator rule and with the settlement rule we can also see which cost categories are relevant. So therefore we need to go into the details and here under cost categories we can now see which costs are relevant. So we can see for instance the property tax, electricity cost, the property and liability insurance but also cleaning cost and garbage removal so all these cost categories are relevant and in the configuration up front we would have assigned and the corresponding GL accounts to which those cost is posted so it could be automatically classified let's get back to the service group so here below of course we then can see the change log for the changes that have been made to the service group now we look into the next step so let's assume that post the cost was for instance posted by a supplier invoice and going back to our main menu we can now go to the classified journal entry items and in this application we can see the results of the there's a so there's a background job configured that then takes over the information that was posted and provides the csn as this overview and then we can see for those entries if it was classified by user or if it was classified by the system and for those entries where it was not classified you can do the declassification manually that means we can say if this is the right service group we can define also the cost category so we could enter a new value and select the cost category from the available cost categories that have been configured and the customizing. And we can also select the service date, but that's taken over from the journal entry. All right. You can also change it for an existing one. For instance, if it was not correct, let's say, for instance, we have here the one that was classified by the system. So we can also go to edit and switch by entering a new value and changing it, which I won't do now. All right, so that's the part of the classification. Now let's get back to our overview in the main menu. and here we can now process or display the results of the cost settlement process steps so we can see that the ledger is already pre-selected now we have to find the corresponding id that's interesting for us and i can see the the hierarchy so in the hierarchy we can see which service group is available so we can see here we have the service group for general costs and there's this group for the for the elevator and then we can also see the from the assignment of the architecture object which spaces are relevant and also to which rentable object they belong so you can group spaces like multiple spaces into one rentable object and then we can also see which contract for which period was assigned to these rentable objects. We can in general see if the space was occupied or not. So of course cost that belongs to a space that was not occupied stays with the landlord and then we can also see for which period this cost settlement process was executed. With the apportionment factor we can also see now for the service groups and the relevant rentable objects, so which part of the cost was allocated to the different rentable objects for the two service groups, so that's why here it sums up to one per service group. And then we see it overall, so we have two service groups, so it sums up overall to two. Of course we cannot only see this by the factor, we can also see this by the cost. and then we can see here the overview like from the overall amount that was distributed we can see that this part like approximately 1700 was allocated to the first service group and the rest was allocated to the second service group and we can then in the last overview see the the distribution of the cost so here we can see for the rentable objects and the real estate contract so which part of the cost would be then distributed to this to the tenant of course if there is a switch of a tenant during the year we would also then see that a rentable object would be twice but we can see this in here in a period for so which period and which cost per period would be um transferred to this tenant yeah that's all already for the for the cost settlement so you can see it's it's now pretty simple um and uh yeah we're looking forward to the next release where we will then complete this functionality with the actual transfer posting to our tenants thank you for listening to this product expert training. We have more learning material for you prepared. Please also have a look at the different channels where we provide new material, like expert trainings every Friday. If you have questions or feedback, please contact us via the email address given on this slide. Thank you very much, and we're looking forward to see you again in the product expert training.