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The new Financial Closing Cockpit:

Improve speed, accuracy, and compliance


while reducing cost with new add-on from SAP

Sandeep Bagchi and Indrasen Avancha


NTT Data at a Glance

 World’s sixth largest IT Service provider & systems integrator


 Founded in 1967 in Japan as the technology arm of the NTT Group
 Over $15B in annual revenues
 60,000 professionals operating in 36 countries
 Serving 80 of the Global Top 100 organizations
 Executing aggressive globalization strategy
NTT DATA Americas - at a Glance

over

17,000 $5B
$ 1.4 +
Annual Revenues
billion
professionals
Revenue

Ambition
and, expanding share of wallet
Successful, long-term client ... sustained through client
through collaboration with NTT
relationships…. delivery excellence…
Group companies…

Balanced Industry
Expertise
Services
55% of ~500
Manufacturing Workforce in low cost Enterprise Clients
Communications and Media
Financial locations
Heath & Life Sciences
Public Sector
NTT DATA Americas - at a Glance

Fast Facts Balanced Delivery Footprint

Resource Locations Additional Projects


• 6500+ SAP Professionals
• 2400+ SAP Professionals are part of NTT North America Organization
• Balanced delivery model: Onshore, near-shore, and offshore
• Key industries: Manufacturing (Discrete & Chemical) , Communications & Media,
Life sciences, Prof Services, Hi-Tech, Public Sector and Distribution
• Tools and Accelerators for ERP Lifecycle management

Competencies
Applications Technology Platforms ERP Tools Achievements / Certifications
• ECC • Netweaver • Mobility • Uptimizer
• CRM • BW/BI/ BOBJ • HANA • Hot Pack Analyzer
• SW CMMi L5 and PCMMi L4 • RUN SAP Certified
• SCM, SRM • MDM • Cloud • ArchivePac
• Financials • BASIS • SPPED • SAP Pinnacle Award : • Challenger in Gartner ERP MQ
• EPM / GRC • Security • SCEA Finalist/Winner for last 5 years in • Leader in Forrester ERP report
• HCM a row.
• Process Aligned Competency
• 5 SAP BAIO certified Solutions excellence (PACE by SAP)
Key Project Stats • SAP Gold Partner approach

• More than 475 Implementations and 45+ Global roll outs


• 120+ Logistics Projects

• 675+ Upgrade planning and Analysis


• 225+ Upgrades Recognized as LEADER by
Forrester in the SAP Service
• 75 + Application Management & Support Providers wave report 2011
• 100+ Advisory Services Engagements and 75+ optimization Projects
Forrester Q1-11 – IT Service Providers
Learning Points

 Financial Closing Cockpit solution from SAP to accelerate an accurate


financial closing cycle, generate accurate financial reports, increase
automation, visibility, and control of regulatory financial statements

 An integrated ‘System of Records’ with ‘System for Reporting’ to


ensure timely and accurate financial statements to the stakeholders

 A full suite of add-on technology and products for SAP customers to


make the closing process faster
Anticipated Benefits with Closing Cockpit

 Increased efficiency and productivity during Close ~ 20%


(Through improved coordination and collaboration)

 Improved control through standard reporting ~ 20%

 Less maintenance and IT administration ~ 15%


(Single-product solution and web-based administration)

 Reduced time for report data collection/distribution ~ 15%

 Reduced need for resource cost and time during close ~ 15%
(Through improved automation and task dependencies/validations)

Based on SAP benchmark studies combined with our experiences


Best Practices

End-to-end best practices to streamline financial close; coordinated processes


across SAP and non-SAP systems

FOREX Valuation, Closing preparation


• SAP GL ; SAP CPS
Global and Local Closing
• Financial Closing Cockpit; SAP CPS
Intercompany Eliminations
• SAP BOBJ Intercompany
Consolidation
• BPC; SAP CPS
Internal Control and Access Control
• SAP GRC
Analysis and Reporting
• SAP BI / BW ; SAP CPS
Barriers to Financial Fast Close

Processes
 Manual procedures
 Missing recon: FI & CO ledger
 Multiple requirements for ‘GAAPs’
 Tedious Intercompany Recon
Controls  Inadequate Audit trails
 Lack of overview of ‘closing
process’
 Error detection is not real-time
Systems
 Coordination is not effective  Decentralized IT systems
 Pressure of regulations like  Lack of process automation
SOX / IFRS / Internal Controls  Lack of integration with source
systems
 Dependency on e-mails/IM/Excel

Organization
 Missing ‘global plan’ for closing
 Lack of coordination
 Within HQ/Subsidiaries
 Between IT & Business
 Missing ownership within
Long and
business teams
frustrating
closing process
Business need for Financial Fast Close

Process
 Automated eliminations, consolidations, audit
trails
 Increased compliance & adherence to both local
and group accounting standards

Systems / Tech
 Integrated systems, automated mapping from
Controls entity to corporate accounts
 Increased efficiency through standardization
& automation

Organization

 Coordinated worldwide closing process


Process Controls
 Improved transparency & investor

Standardization
confidence
IT Systems,
Technology

 Complete control & visibility over the close


process Organization
 Full cycle compliance monitoring and
internal control
Optimization
Financial Fast Close

 Financial Fast Close (FFC) solution integrates four different SAP applications
to support an effective financial close:
 Financial Closing Cockpit (FCC) for robust
closing process in SAP ECC
 BW for reliable reporting and analysis of close
 CPS scheduler for greater automation and
transparency
 BPC for efficient consolidation, financial
reporting and analysis
 Additional components from the SAP Business Analytics product line are
layered into a holistic solution:
 Disclosure Management
 Business Intelligence
 GRC Access and Risk assessment
Integrating the Closing Applications

 Financial Fast Close Solution


(leveraging SAP® Applications )
helps entire finance
organizations create an
automated, standardized
dashboard serving as a single
point of control

 The overall solution increases


the speed and reliability of the
financial close by simplifying
time-consuming, error-prone
tasks, improving finance
functions and processes
Financial Fast Close – Overview

Faster Closure in ECC with FCC:

 Global game plan to execute,


automate, monitor and analyze the
closing tasks

 Improved transparency and reduced


errors during transaction processing

 Reduced cycle time from weeks to


days and therefore reduced TCO –
better utilization of resources.

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Copyrght © 2011 NTT DATA Group 2
Financial Fast Close – Consolidation

Financial Consolidation (BPC) :

 User adopted MS Excel interface

 Process-centric for compliance

 Automation /standardization of
intercompany eliminations and
recurring entries

 Easily adapts to business


changes/models and demand

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Copyrght © 2011 NTT DATA Group 3
Financial Fast Close – Reporting

Financial Reporting (BI/BW/BPC)


 Single source for robust
reporting and analysis of results.
Immediate reporting after
adjustments

 Operational review deck with key


performance indicators for
consistent assessment of metrics
for investors

1
Copyrght © 2011 NTT DATA Group 4
Financial Fast Close Solution Overview

SAP ECC BI/BW Reporting

CPS from Redwood Enterprise Portal

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Copyrght © 2011 NTT DATA Group 5
What is Financial Closing Cockpit?

Closing Cycle in SAP ECC


Define  ERP-based application to plan, execute,
Global automate, monitor and analyze the closing tasks
Close Plan
 Provides a global game plan perspective for the
Prepare financial close
Local Close
 Minimizes the process cycle time to close by
Execute providing complete visibility to the closing tasks
Local Close
Tasks  Allows for easy integration with SAP BW/BI and
Enterprise Portal for reporting and SAP BPC for
Analyze
Local Close Planning and Consolidation
Result

Prepare Data
for
Consolidation
Financial Closing Cockpit – Evolution

SAP ERP EhP3 SAP ERP EhP4 SAP ERP EhP5 SAP ERP EhP6
Web user interface Multiple calendars in Mass change for Multiple attachments
the same template Template ,Task-lists per task
Structuring of tasks into Web UI in NW Transport of Template User-definable time
closing phases Business Client and its components zones

Remote Tasks execution Better reporting with Increased compliance Increased Performance
via integration real-time SAP NW
to SAP CPS BW queries
Process Automation Better Integration Better integration with Improved Integration
through SAP CPS with SAP workflow SAP CPS with SAP CPS

Factory calendar Document upload New organization Enhanced Task-list


functionality entity: Plant creation/change

Responsibilities on Customer-defined
folder level fields on template and
task level
Financial Closing Cockpit (FCC) Add-on 1.0

The add-on combines significant new capabilities on top of existing SAP


ERP 6.0 EHP6 functionality
 Governance and Control
 Extended Authorization
 Central storage of log
 Audit trail for all changes to templates and task lists
 Efficiency
 Easy template maintenance (Upload / download)
 Improved usability (SAP GUI, Web UI harmonization, Other UI
enhancements)
 Control
 Task execution with dependency view
 Easy monitoring and analysis of global tasks
 Upgrade monitor for existing customers
FCC Add-on 1.0: Improved Architecture

SAP Financial Closing Cockpit SAP Financial Closing Cockpit


as a part of ECC 6X Add-on 1.0

Installation options: NW or Business


Suite Foundation

Recommendation: Leverage ERP


server with ECC
Source: SAP
FCC Add-on 1.0: Improved Authorization

Old New
FCC Add-on 1.0: Improved Audit Trail

 Job Log, Spool Log and the history of execution logs are stored
automatically and are accessible by PDF file even if out dated
 Log links are displayed in detailed format with run times/ID/time
 The feature applies to both SAP GUI and Web UI
FCC Add-on 1.0: Improved Efficiency
FCC Add-on 1.0: Improved Automation

 The FCC Add-on uses Standard


Variables from STVARV table as
well as Custom Variables for
closing jobs
 The availability of custom
variables has significantly
helped to improve the
automation of jobs
FCC Add-on 1.0: Improved Task Automation

 New Task Types


introduced in FCC

 Allows to remotely
connect and execute
tasks in
heterogeneous system
without additional
login
FCC : Improved Process Automation

 SAP Central Process Scheduling: SAP’s solution for the SAP


NetWeaver platform to help companies manage, monitor, and
execute business-critical processes from a central location

 Integration of SAP Central Process Scheduling with the FCC


allows:
• Closing tasks in a multisystem landscape
• Event based execution
• Automation of the batch inputs
• Automation of transactions
• Extended management of variants and parameters
• Validation of task outputs
FCC: Automation through CPS

FINANCIAL CLOSING COCKPIT SAP ERP

SAP CPS
REDWOOD SAP CRM
FI/CO MM SD FULLY
INTEGRATED
OTHER
SYSTEMS

SAP Net Weaver

SEAMLESS
PROCESSESS
SEAMLESS
TECHNOLOGY
PROCESS
AUTOMATION
REAL TIME
CROSS SYSTEMS SEAMLESS
INTEGRATED RESOURCES
REMOTE CHAINS BUSINESS SEAMLESS
SOLUTION INSIGHTS
Integration: ECC-BW-BPC

 The BW process chain provides a means for bundling all the operations
together (such as loading master data or transaction data from ECC) so
the entire process can be automated, scheduled, and controlled
 BPC Data Manager packages are technically executed as a BW process
chain

Source: SAP
Integration: Delta Processing

 Financial Closing requires frequent data


updates in the Reporting Application
(BW/BPC) from the Transaction system - ECC

 SAP offers several options to accelerate the


data loading speed to maintain the integrity
of data between transaction and reporting
application:
• Delta loading architecture
• Increasing load frequency
• Leveraging real-time background
processing in SAP NetWeaver BW
Automation of Process Chain: ECC-BW-BPC

 The completed BW process


chain can be executed from
BW by direct scheduling or
by triggering other BW
events (such as ECC to BW
loads)

 Execution of the BW
process chain by triggering
from BPC is recommended
Automation of FX Rate: ECC-BW-BPC

 Currency rates in ECC (TCURR data) could be by date whereas BPC


rates are maintained by month

 In order to automate, maintaining one rate per month per


currency in ECC is recommended

 DSO could be maintained in ECC based on TCURR table to get the


rate for each month for the currency type

 DSO would update the rates systematically using the Data


Manager package
Automation of IC Elimination: ECC-BW-BPC

The IC Elimination process could be automated using the


following steps:
 Importing Transaction Data in the ‘Last Overwrite Mode’

 Exporting IC Transactions to ‘IC Model’ to do the following


• IC Booking
• IC matching
• IC Elimination: To eliminate all the IC transactions and
make it zero during close
Intercompany Reconciliations

• Time consuming and


manual escalation process

• Responsibility of the HQ to
resolve discrepancies
Source: SAP

• Faster peer-to-peer
intercompany
reconciliation

• Allows HQ’s to monitor a


collaborative matching
process using centrally
defined rules and FX
New Financial Close Suite

Comparative list of SAP products and solutions that make closing process
faster, accurate, and less costly for organizations

Business Process SAP Solutions

Financial Accounting (GL FCC Add-on 1.0 & SAP Classic GL, Closing
and Sub Ledger) GL, SAP CPS Cockpit

Local Close FCC Add-on 1.0 & SAP SAP ECC with Backline
GL, SAP CPS A/c Recon
Corporate Close SAP BPC SAP EC-CS

Closing Governance and SAP GRC Solutions


Internal Control
Reporting SAP BO/BI/BW Crystal Reports
Key Learning

 FCC should be a business project. The implementation is more


effective when CFO or the Controller of the organization owns the
project

 Account and plan for ‘Change Management’ during the project


implementation

 There is no ‘integration’ of Financial Closing Cockpit other than via


the Business Automation Enabler (BLE) – SAP CPS

 Process automation is possible beyond Financial Close with SAP


Central Process Scheduler (CPS)

 A considerable amount of time is required in designing a global


plan for close. Start the design on paper/excel. Use upload tool for
large templates
Key Learning..

 Most significant time savings and cost reductions are possible with
event driven scheduling and execution

 Integrate Closing Cockpit with BI/BW reports and Enterprise Portal


to get the most of value additions

 FCc will need continuous analysis of the close activities and


improvement to the Closing Templates / Tasks before the next
period
Contact Information

 Sandeep Bagchi
• Director, SAP Solutions
• Email: Sandeep.Bagchi@NTTData.com
• SAP Ecohub for Fast Close Solution:
http://ecohub.sap.com/catalog/#!solution:FinancialFastCloseServices

 Indrasen Avancha
• Manager, EPM Practice
• Email: Indrasen.Avancha@NTTData.com
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