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Choosing the right financial ledger: 9 key issues

by The Tip Doctor

February 17, 2011

Tip Doctor, Insider Learning Network.

The following tip has been taken from Rohana Gunawardena’s presentation “Guidelines for choosing the right financial ledger to meet your reporting needs” scheduled to take place at the Financials 2011 conference in Las Vegas, March 8-11.

With more than a dozen options available in the SAP system for financial ledgers, choosing the best solution to meet your needs can be challenging.  Here are 9 things that you should keep in mind when going through the selection process:

1. Keeping a book of record

  • In your SAP financial system, you will need to have one ledger that is considered the book of record
    • Basis for legal financial records
    • Usually it is FI-GL, SAP G/L, or FI-SL

2. Maintaining multiple data sources

  • Multiple ledgers mean the possibility that the different ledgers will give different answers to the same question
    • Reliability of financial figures is questioned because of multiple sources
    • Unnecessary duplicated data eats up database space
  • Multiple layers of ledgers can result in confusion when a problem occurs
    • Lack of transparency in source data
    • Cannot find origin of summarized data

3. Keeping in mind any reconciliation issues

  • The use of multiple ledgers always raises reconciliation issues
    • Some are easier to reconcile
      • FI-GL vs. FI-SL
      • FI-GL vs. CO-CCA
  • Some are more complex to reconcile
    • FI-GL vs. CO-PA
    • FI-SL vs. SIS
  • In some cases trying to reconcile the two ledgers may not be effective or required

4. Factoring in how your ledgers affect your closing processes

  • More ledgers mean more processes at closing
    • Using too many ledgers can cause too much work at closing
      • Make sure the benefits of the new ledger outweigh the drawbacks
  • Consider shutting down unnecessary ledgers
    • If EC-PCA is implemented, do you still need FI-SL?

5. Interdependencies between ledgers

  • You will always need to have FI-GL or SAP G/L configured in SAP ECC as the basis for all financial transactions
  • To get specific functionality, you may need multi ple ledgers/modules implemented
    • To get inter-company stock transfer pricing working correctly, you need EC-PCA and CO-PC-ACT

6. Existing Configuration

  • The existing configuration of key ledgers may limit their use or entail corrective action
    • E.g., Initially FI-GL was configured with document currency and local currency only; now you require group currency for your transfer pricing solution
      • This is a common scenario for a company which started with a local outlook, but has now acquired an overseas subsidiary
  • You need to call in the SAP System Landscape Optimization Group or a specialist consulting firm to make the change for you
    • See SAP Notes 27621 and 39919

7. Storage Space

  • Activating new ledgers/modules will take up additional database storage space
    • This can be a major issue with SAP ECC systems
  • Work with your Basis and DBA teams to size the ledger and allocate adequate storage space
    • Realistically, you should size for several years of data, not just the current month’s requirements
  • It’s never too early to start thinking about an archiving strategy
    • If the ledger is supplementary to FI-GL or SAP G/L, as little as two years of data may be adequate

8. Performance

  • Additional reporting from an SAP ECC system will reduce end-user response time
    <
    • Each financial transaction needs to update multiple ledgers, adding to system load
    • Review slow reports
      • Break up into smaller reports
      • Review coding for performance tuning
  • Work with Basis and DBA teams to tune database response time
  • Consider SAP BusinessObjects BI-based solutions to reduce system load and improve reporting performance

9. SAP Support

  • SAP has discontinued any new development for many of the ledgers listed
    • This does not mean they are bad choices
    • Often older modules are more stable than newer ones
    • It is easier to find skilled consultants for older modules
    • SAP still has SAPNet support for bug fixing, just no new functionality

More Financials information, tips and advice, including articles from Financials Expert, are available on Insider Learning Network's Financials Group.

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