UPA – Universal Parallel Accounting On-Premise/Private Cloud Advantages and Asset Accounting Configuration

Introduction:

My journey with SAP 17+ years and have been working various versions from 4.6B, 4.7EE, ECC 5, ECC 6 (1 to 8), sFIN, S/4 HANA all the versions till now (up to S4H 2022) on Cloud and on-premises versions.

I personally feel & absorbed the new changes on each version & with that excitement, I used to implement those features by showcasing the business value additions to the customers/projects & now with UPA solution we have been achieve a bigger milestone.

UPA Key Capabilities:

• Parallel Valuations: Target to achieve non leading ledgers functionality same as Leading ledger
• Alternative Fiscal year: Possible to use different fiscal years for each ledger with limitations and that has been addressed in UPA and have it’s own reporting capability as per the local / group level fiscal years.
• Group Valuation on real-time (refer Slide1 below): Was it addressed through Leading ledger and now with UPA this has been achieved with non leading ledgers by posting data on real-time without posting an adjustments.
• Multi Currency Capability: we have been using 10 currencies (8 additional Currencies) from the first release of S4HANA with few limitations, that has been addressed now with UPA.
  • Ex:
    • Material master has the capability to hold Ledger + currency type wise amounts
    • CO –> FI will be post all the currencies
    • No additional configuration needed for AA, ML, CO for currencies except ledger, company code setup.
• Value Chain Analysis & Transactional Carbon Accounting

Recap a few highlights:

• 4.6 B to 4.7EE:
  • Withholding tax à Extending withholding Tax including TCS.
  • Partner functions (Bill to, ship to etc).
  • FSCM Solutions.
• 4.7 EE to ECC:
  • ECC is built on Net Weaver Technology, hence more reliable and improved as compared to previous ones.
  • New GL (Document splitting, Parallel accounting)
  • Segmental reporting
  • New Asset accounting from EHP8
  • Profit Center account replaced with New GL & Many more………
• ECC to sFIN:
  • Simplified the Finance architecture and data model
  • Introduced Universal general (Single source of truth: ACDOCA)
  • Introduced three Additional currencies
  • New Asset Accounting
  • Real-time reconciliation b/n CO <-> FI
  • Minimized period and year-end activities.
  • Enabled Netweaver for Bank account setup & Many more………
• sFIN to S/4HANA:
  • Simplified the Finance & Logistic architecture and data model
  • Introduced Extension Ledgers
  • Introduced Eight Additional currencies
  • Predictive Accounting / PO Accruals
  • Realtime reconciliation b/n CO ßà
  • Drag and drop, 360-degree reporting capability.
  • Single BI Extractor
  • Eliminating data redundancy and data footprint reduction
  • Fiori apps for setup Banking solution (BAM) Bank account setup & Many more………

• S4HANA to UPA:Universal Parallel Accounting is the basis for future innovations within and beyond accounting.

UPA – Universal Parallel Accounting is the next-generation out-of-the-box solution from the SAP S/4 HANA and it has addressed many issues for which we do not have straightforward solutions from the earlier releases and would be covered through the alternative way by covering the technical limitations.

UPA solution provided much more advantages to the business and eliminated key period-end closing activities, by designing the process simplified, and making real-time posting by eliminating period-end batch jobs or executions etc.

• UPA was released on the public cloud in 2105 and Private/On-premises versions from 2022 (with few restrictions)
• Released New Business Function (FINS_PARALLEL_ACCOUNTING_BF) for UPA and no reactive once it is active.
• Setup each Ledger has its own valuation view (Legal valuation / Group Valuation etc.)
• Setup Ledger and Currencies for the company codes and they are supporting the entire process (FI/AA/CO/ML etc.) & no additional configuration is required as in earlier versions.
• Further simplified Asset Accounting configuration, user activities, and no more alternative setup required for different fiscal years/currencies.
• Except for the Depreciation setup, the rest of the configuration steps have been replaced with a new path, transaction codes, screens etc.
• AUC-Investment order / WBS are supporting with ledger base settlement rules.
• AUC line-item settlement is no longer available.
• Quantity field enabled for all the valuation views/Depreciation areas.
• Introduced “Usage Object” field in asset master for calculating depreciation on UoP-Unit of Production.
• Fiori App for “Maintain Number of Units for UoP Depreciation”
• Possible to setup derive depreciation areas
• Asset Master and explorer from Fiori App “Manage Fixed Assets” (GUI transactions are not supported)
• Each ledger-wise Capitalization date / Asset deactivate date fields are available.
• Introduced Planning horizon field “OAAQ” (Max 10 years) and the system will calculate planned depreciation on the fly (Impact system performance).
• UPA-Asset Master data/transaction tables are replaced compared with S4HANA.
• New Fiori App “Manage cost rates” for uploading ledger-wise activity price.
• Event Base Posting (WIP calculation) and eliminated period end process.
• Assign Ledger/ Accounting principle-wise different costing variants.
• The price variance is automatically calculated during goods receipt on the production order (event-based postings).
• Cost sheet month-end activities are no longer required.
• Execute standard cost for each ledger and those rates are updated in Material master with reference to ledger and currencies.
• The material price will be updated in the master with a combination of Ledger + Currency type & while posting the Goods movements the system takes the price from the material master (Accounting 1) and generates accounting entries with different amounts for all the ledgers assigned to the company code.
• For the Good Receipt & goods issue the system will take the price from the material master based on each ledger and currency type combination and post accounting entries without checking TCURR table rates.
• Account Assignment “M” will be supporting to calculate of Sale order costing
• Transaction CK51N is allowed to run “Sales order costing” for all ledgers and VA01/VA02 will be supported leading ledger only.
• Lower Cost of Finance with a base layer for group reporting with pre-elimination of inter-company profit:
  pre-consolidated view eliminating markups for intercompany transactions to see the impact on business unit and group performance without running a consolidation process
• More effective steering with a layer for predictions and simulations
  the resulting parallel postings result in improved, consistent transparency for better business steering, along with flexible organizational structures
• Drag and drop, 360-degree reporting capability.
• Realtime reporting “Management reporting at group level”.
• Generating Local Legal & Group view reports at the same time.
• UPA has its own FIORI roles (S4H roles are not supporting) and Apps.

Parallel Valuation (Inventory / Assets etc)

Slide1: UPA Addressed Parallel account GAPs

Asset Accounting Configuration Guide on UPA:

Slide2: AA Configuration S4HANA vs UPA

• Ledger Setup: 0L = K4 (Jan to Dec)                               2L = V3 (Apr to March)

Slide3: Ledger Setup with Different Fiscal year

• Ledger and Currency:

Slide4: Ledger wise Currency Mapping for Local legal / Group Valuation

Note: the Configuration related to Asset accounting has been completely changed & Simplified on UPA (Except depreciation setup) and I have presented below related Asset accounting end to end configuration steps.

• Define Valuation View
  

SPRO à Financial Accounting à Financial Accounting Global Settings à Asset Accounting (Parallel Accounting) à Basic Settings for Valuation à Define Valuation View

Slide5: AA- Valuation View

• Assign Valuation Views to Accounting Principle

Slide6: AA- Assign Valuation view to Acc Principle

The entry “MSNA” in this field means:

1. 1. M – Transferred reserves (acquisition value reducing depreciation)

1. 2. S – Special depreciation

1. 3. N – Ordinary depreciation

1. 4. A – Unplanned depreciation

This field internally stores the sequence in which ordinary depreciation, special depreciation, transferred reserves (depreciation reducing acquisition value) and unplanned depreciation are calculated. The reverse sequence applies when the system corrects calculated depreciation, either because the asset’s value goes below the cutoff value, or because of violation of the rules for postive/negative net book value.

• Define Depreciation Areas in Company Code

Slide7: AA-Define Depreciation Areas in Company code

Note: before UPA, the COD-Char of Depreciation area & Depreciation areas are playing key roll in Asset Accounting and now with UPA the valuation view is the key step for Asset Accounting.

• Make Company Code-Dependent FI-AA Settings per Accounting Principle

Slide8: AA- Company code dependent Setting, Acc Principle, COD, Document type for posting Depreciation and Revenue posting on net/Gross.

• Define Layout for Asset Master Record

Slide9: AA – Define Asset Master Layout

Note: Simplified approach instead selecting from screen template (from 3 screens) now we have to choose which are the fields needed as per the requirement and select further options for each field and no Copy option available now & Provided another step for similar assets.

• Define Asset Class

Slide10: AA-Define Asset Class

Note: No AUC process enabled with in Asset Accounting Module, but we can have AUC process through Investment order / WBS.

Enabled Asset Super number in Asset class level where is was in Asset master level.

• Make Valuation View-Dependent Settings for Asset Class

Slide11: AA – Default settings for Asset Class and Valuation view

Note: it was AA Class, COD & Depreciation area level, on UPA maintain default values for Each AA class and Valuation view level.

Activate Low Value Assets for each AA Class + Valuation view

• Assign G/L Accounts

Slide12: AA – Assign GL Accounts for AA Postings

Note: this step was tedious activity for the consultants, now it is simplified in UPA, the GL assignment in AA is in once screen.

Make a valuation view “*” for the technical clearing account for APC and Legacy data Transfers.

• Define Account Assignment Rules per Accounting Principle

Slide13: AA- Activate account assignment objects for each accounting principle

Settlement Profile: Ledger wise Settlement

Slide14: AA – setup Settlement profile for enable to settle ledger wise different settlement receiver objects

Note: with this option, we can able to settle ledger wise different receiver objects

Slide15: Ledger wise Settlement rule

Display Asset APC Posting document (ACDOCA)

Slide16: APC Document Display and universal general “ACDOCA” updated view

Conclusion on Asset Accounting:

• Simplified Asset Account configuration screens
• Minimized Asset Accounting configuration steps
• No configuration needed in AA module for additional currencies / Fiscal years.
• UPA “AA” run on Valuation view and further dependents like Accounting principles etc.
• Possible to settle WBS/Investment cost to AA and Cost object based on ledgers.
• Capitalization date & Deactivation date field enabled for each ledger where it was only one for each assets.
• Quantity field available for all ledgers where it was only one depreciation area.
• Technical ledger line has been updated in ACDOCA for each reporting / additional depreciation area.

Summary:

• Prerequisite: OSS Note 3207221
• List of Scop / out of scope items: OSS note 3191636
• Mandatory BF: FINS_PARALLEL_ACCOUNTING_BF (not possible to revert)
• Org element: Business area is no longer available.
• Group Asset: Obsolete in SAP S/4HANA.
• Evaluation groups in AA Master: Obsolete. Is replaced by extensibility concept
• BAPIs for asset postings: The previous BAPIs for asset postings (for example, BAPI_ASSET_ACQUISITION_POST, BAPI_ASSET_TRANSFER_POST, BAPI_ASSET_VALUE_ADJUST_POST) are obsolete
• Independent assets under construction (incl. creation of settlement rules): Obsolete. Instead, you can use WBS elements.
• Depreciation Area for Foreign currency: Obsolete. No longer required due to new concept for parallel accounting and currencies.
• Do not post depreciation area data updated in ACDOCA with Technical Ledgers “$*.
• ML: Material Ledger currency definition is obsoleted.
• The material price will be updated in master with combination of Ledger + Currency type & while posting the Goods movements the system takes the price from material master (Accounting 1) and generating accounting entries with different amounts for all the ledgers assigned to the company code.
• For the Good Receipt & goods issue the system will take price from the material master based each ledger and currency type combination and post accounting entries without checking TCURR table rates.
• UPA for Value Chain Analysis & Transactional Carbon Accounting

Source of more information:

SAP Help on UPA

Value chain Analysis:

Taking Accounting to the Next Level with UPA in SAP S/4HANA

SAP Note 3042679: FAQ: Product Costing: Limitations for Product Cost Collector in Parallel Accounting

SAP Note 3042696: FAQ: Product Costing: Limitations for Settlement to Non-Material Receivers in Parallel Accounting

SAP Note 3049064: FAQ: Product Costing: Limitations for Orders Run with Period-End Closing (BEI) in Parallel Accounting

SAP Note 3042687: FAQ: Product Costing: Transition from Period-End Closing to Event-Based Posting with Parallel Accounting