New ways for Group reporting

End of SAP Financial Consolidation maintenance

Many companies are still working with software solutions that are no longer up to the new requirements and whose maintenance the manufacturers are therefore ending in the foreseeable future: SAP Financial Consolidation, for example. It is therefore important to look for a suitable successor system now and to tackle the change in good time.

The consolidated financial statements are a legal obligation for companies, but at the same time reporting also offers the opportunity to convince partners, investors and customers of the financial situation and to win them over. In addition, comprehensive reporting also facilitates internal decision-making processes. However, the demands on reporting have increased considerably in recent years: Reports are no longer expected on cyclical, fixed dates; instead, analyses and forecasts are increasingly required on an ad hoc basis - for example, when important operational or strategic decisions have to be made in corporate planning. However, the quality of data must not suffer as a result of its rapid availability - quite the opposite. As many data sources as possible should be taken into account, and consolidation processing should be automatic but also easy to follow.

Discontinuation of Financial Consolidation

Ideally, companies therefore work with highly integrated software that includes a data model for both actual reporting and planning and offers powerful functions for consolidation and reporting. Companies around the world have been using SAP's consolidation products for this purpose for years, including SAP Financial Consolidation (SAP FC) and Strategic Enterprise Management-Business Consolidation (SEM-BCS). The problem with this is that SAP now offers more modern solutions and has discontinued SAP Financial Consulting at the end of 2027 - mainstream maintenance for SEM-BCS also expires at the end of 2027. From then on, risk-free operation of these solutions is no longer guaranteed.

However, waiting until then to switch to a different software is not advisable - because the introduction of a new solution can take up to two years, depending on the complexity of the booking and reporting requirements. In order to minimize the risk of being left with unmaintained software or not being able to make the switch on time shortly before the deadline, it makes sense to switch to the successor system now - especially since companies can already benefit from additional functionalities by switching to modern software for group reporting. S/4 Hana for Group Reporting is the successor solution that not only incorporates strengths of SAP Financial Consolidation, but even goes beyond it in terms of integration with accounting and controlling. The change of system therefore offers companies the opportunity for modern group reporting that meets increasing requirements.

Successor system

Like SAP FC, S/4 for Group Reporting offers intuitive definable posting logic as well as consolidation processing that can be automated and easily tracked. The system can therefore be tailored to the company and its reporting system and combine the reporting of all group companies into a meaningful consolidated financial statement. Alternative consolidations can be efficiently mapped for simulations, enabling companies to react quickly and flexibly to changes in exchange rates or reorganizations, for example. The data required for reporting can be transferred in a variety of ways, from automatic integration to web-based data entry. A wide variety of data sources or upstream systems can be efficiently connected and used in this way. The data is also available for further evaluations and can be exported. Reporting is comprehensive with the system and also includes the automatic determination of the necessary key figures.

Conceptually, Group Reporting has a certain similarity to SAP FC in some areas and is therefore the ideal successor for those who have already been working with SAP FC. Migration tools are provided to make the transition easier. It should be noted, however, that they primarily enable the transfer of transaction data between Financial Consolidation and Group Reporting. The transfer of the posting logic is not supported by the tools and must be done in another way. Comprehensive knowledge of SAP FC is therefore a mandatory prerequisite for the migration to Group Reporting. Management consultancies that specialize in the areas of Enterprise Performance Management and Business Intelligence can provide significant support during the migration and ensure that it runs smoothly.

BCS/4 Hana to SEM-BCS

In addition to S/4 for Group Reporting, SAP has another product for group reporting in its portfolio: For companies for which Group Reporting does not offer sufficient added value, and especially for those who have been working with SEM-BCS up to now, the BCS/4 solution is particularly suitable. This is because it extends the scope of its predecessor, but is essentially based on the familiar concepts. Companies therefore do not have to familiarize themselves with a completely new system and at the same time benefit from additional functions. 

The new functionalities cover all product areas, from administration and user-friendliness to data transfer and the consolidation process to evaluations and reporting. Like SEM-BCS, the solution offers powerful yet flexible customizing, expandability of the programmed posting logic, and efficient processing of the consolidated financial statements. For example, it is possible to define the report contents completely freely. This makes it possible to map external and internal reporting that is completely adapted to the company's own requirements.

The extended functionalities of BCS/4 Hana are no longer available in the initial version SEM-BCS. To use them, companies must license BCS/4 separately. Companies that have already built applications for consolidation and group reporting with SEM-BCS in the past can protect their investments with the new license. In addition to the extended scope of services of BCS/4 compared to SEM-BCS, companies also benefit from the migration to BW/4 Hana as SAP's strategic data warehouse solution.

System change as an opportunity

Companies should not see the change of system for group reporting as a burdensome evil that sprouts up because maintenance for the previous system will be discontinued in the foreseeable future or because certain functionalities are not provided in the software currently in use. Rather, the changeover is also an opportunity to benefit from the technical advancements that take reporting to a new level. This is because the modern solutions make it possible to accelerate the preparation of consolidated financial statements, while optimizing processes and thus also saving costs. At the same time, internal and external accounting are integrated, enabling a holistic view of the earnings, financial and asset situation. Accounting processes, for example intercompany reconciliation, are facilitated by the new solutions through digitization and machine learning - meaning that many processes can be automated. The new products also offer informative and intuitive reports and dashboards that can be used to efficiently analyze company performance and create valid forecasts.

Conclusion:

The SAP Financial Consolidation and SEM-BCS products will be discontinued in the foreseeable future. Companies are therefore well advised to rely on the successor solutions now: not only because they can minimize the risk of a system change with sufficient lead time, but also because they can benefit early on from the expanded functional scope of the modern solutions. After all, these offer helpful innovations for group reporting that accelerate reporting processes and make them more efficient. External partners provide support in choosing the most suitable successor software and in ensuring a smooth migration.