Concepts and products overview - SAP ERP Tutorial

- [Instructor] Let's start the first lesson of the S/4 Financial Accounting Overview. So in this lesson, you'll learn how to recognize the scope and function of the financial accounting module, you'll learn to identify financial accounting sub-components, you'll also learn to understand the role of the Financial Org Structure, or Organizational Structure, and you'll also learn how to identify the different integration points of the financial accounting modules with other modules in SAP. In terms of an agenda, we'll first look at what S/4 HANA Finance is in terms of its Scope, and the Product structure the way SAP structures its products, and the capabilities. We'll then dive into SAP's accounting concepts, how it breaks things down into different modules, and also how they are integrated, and we'll also focus on the SAP Organizational Structure. And then we'll go to the individual modules themselves, looking at the General Ledger, or known as the GL, Accounts Payable, also known as AP, Accounts Receivable, AR, or Asset Accounting, AA, and Financial Supply Chain Management. So, with that said, let's dive into the details. The main scope of financial accounting really is to collect, and classify all financially relevant transactions for a company, so it really is the heart of the system, collecting all of your debits and credits in a standard accounting format. Once the data's been collected, recorded and classified, it can then become the system of record to produce for external and internal financial reporting, primarily for legal entities, and for your global organization. Once you've collected the information, you can produce your internal and external financial reporting, the idea is also to empower decision makers to take appropriate action to improve company performance and reduce risk. All of the information in SAP is available by real-time flow between all of the modules, and this is so you don't have to wait for best processes or the end of month to see specific reports. So this really is the main scope of what financial accounting is intended to do in SAP. So in terms of their modular approach of the product, the capabilities are structured as a set of modules and sub-modules, the key thing in SAP is that these modules share data and they are very tightly integrated. Think of them as puzzle pieces as they fit together. Core financial capabilities are part of the S/4 HANA Business Suite, and then additional capabilities can also be added as optional extras, but the key takeaway here is there many different modules and sub-modules in finance, but they are very tightly integrated together, and that's how their chief product is structured. So on this slide, we're going to look at how the SAP Finance Product is actually structured and its capabilities. When we talk about SAP S/4 HANA Finance, when you license the product, you get certain core capabilities that are part of the S/4 business suite, and then you get other capabilities which are available as optional add-ons or specialized products which can be integrated with S/4. So for this course, we're going to focus on the Core S/4 finance modules that you get with the standard S/4 licensing. So in terms of those components, if we break this down into different business capabilities. The green boxes here represent the main business capabilities that you get with S/4. So from a finance perspective, you get capabilities that cover Financial Planning and Analysis, so typical things like Planning, Budgeting, Profitability and Cost Management are included under this area. We also cover the capability of Accounting and Financial Close, so Financial Accounting processes, like entering journals et cetera, Periodic Closing, Consolidation and general Financial Reporting are also part of the standard Core business suite. Capabilities with Treasury and Risk Management are also included, this will cover things like bank and Cash Management and liquidity management are also part of the S/4 Finance Core. Then Finance Operations, things like Receivables, Payables, and Invoice management are also part of the S/4 Core. There's also a basic set of Governance Risks and Compliance capabilities with the standard Core. These help you control, you know, user access Control and Compliance and Audit Capabilities. So these are all basic capabilities that every company would get by licensing Core S/4, and we're going to focus on these areas in green here in more detail. As for the optional extras, we'll cover this later in the course, some of the very common ones which are popular are things like BPC, which is more advanced Planning and Consolidation capability, and, if you think of a process maturity curve, a company may first adopt the more basic processes in the Core, and then expand to more advanced capabilities or depending on the size of your organization. This is also where you can then also adopt additional SAP capabilities like Receivables Management, or a Financial Closing Cockpit, or other areas where machine learning can also be adopted, like the Cash Application module. So these are all additional areas that can be added on, but these are optional areas versus the Core. So this is just to give you a better understanding of how some of the product capabilities are structured.