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

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

Controls

Lack of overview of ‘closing
process’

Error detection is not real-time

Coordination is not effective

Pressure of regulations like
SOX / IFRS / Internal Controls
Processes

Manual procedures

Missing recon: FI & CO ledger

Multiple requirements for ‘GAAPs’

Tedious Intercompany Recon

Inadequate Audit trails
Systems

Decentralized IT systems

Lack of process automation

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.

1
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

1
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

1
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
 THANK YOU FOR PARTICIPATING
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