Simple Finance: The Hybrid Approach
In order to solve this double issue (redoing the programs and values on summary data), the SAP
development team came up with an hybrid architecture, in which the line item values and the summary
specific values are separated into different tables, and then combined into a consolidated view.
It is very important to understand that these new views (technically called CDS Views) will be
automatically generated by Simple Finance during installation and guarantee the continuity of all
existing programs, standard (variance, assessments, settlement, etc.) or custom, while reducing the
database footprint and boosting the overall performance. As Hasso Platner said himself in his blog: “It is
the by far the biggest improvement in the history of SAP's enterprise systems
Multiple Implementation Scenarios
The new Simple Finance platform will enable companies to implement new scenarios, depending on
their priorities:
Significant reduction in reconciliation efforts;
Real-time processes that eliminate bottlenecks during financial close;
Next-generation user experience.
Reduction in Reconciliation Efforts
A typical case is the rework needed when corrections are done in the ledger and subsequent cost
allocations have to be reverted and reprocessed. In order to avoid this situation, the FI and CO
documents have been merged 1:1 at the line-item level into a so-called “Logical Document.” With this
new architecture in place, the internal and external reporting is harmonized, and the reporting and
analysis can be performed with more flexibility given the smooth link between FI and CO.
Thanks to the Logical Document introduced with Simple Finance, the account-based CO-PA integration
mechanisms can be used in real time; there is no need for reconciliation anymore and several steps can
be skipped at each month’s end. (However, be aware that Simple Finance does not yet support
costing-based CO-PA.)
Real-time Processes that Eliminate Bottlenecks during Financial Close
With SAP Simple Finance, thanks to the removal of aggregate tables and the introduction of the logical
document, the period-end close can be performed on a recurring basis and reports can be published in
real time. This enables analysts to identify and correct mistakes earlier and decision-makers to correct
course during the period rather than 30 days later
Next-Generation User Experience
The key difference is that not only were aggregate tables replaced with CDS Views that support a
reduced footprint, higher performance, as well as backward-compatibility of all standard and custom
ABAP programs, but also that these views were integrated into SAP HANA Live.[9] This HANA layer acts
as a content publication service offering an easier platform for the creation of reports. Here are some
examples:
Migration to Simple Finance from Current Environment
Two options are available for migration -
Using Simple Finance as Central Ledger
Many large organizations maintain more than a single ERP. This architecture is usually the result of
performance trade-offs (one smaller ERP system, according to region), history (mergers, fusions or
acquisitions) or legal requirements. In order to achieve a corporate view of the organization, operations
are handled locally and data is collected centrally for reporting. However, this process is very slow,
doesn’t allow real-time decisions at a high level, and presents a disconnection between the aggregated
results in the central repository and the line item stored in decentralized locations.
Moving from Business Suite to Financials Add-On.
If your organization is maintaining a single ERP environment, or only a few ERP instances, a better
solution could be the migration from a traditional SAP ERP Business Suite to Simple Finance. To do this,
you would have to perform a migration of your underlying database to SAP HANA before installing the
Financials Add-On. Check the documentation for more details on the requirements.
