An insight in ECC data issues impacting Financial Results

Examples are the purchasing data like goods receipts/invoice receipts matching, accounts receivable analyses, order aging where sales orders, or production orders, can carry balances that did not get cleared.

Results Analysis (RA) is one of the more complicated functionalities in SAP Controlling used to calculate results on orders, projects, and sales orders. Auditors are always looking to reconcile this due to the direct impact RA has on the financial result, but again volumes are high and data sits in various modules making reconciliation and transparency hard.

Intercompany transactions occur via automated invoice exchanges that can fail, but often manual too. Transactions can happen within the SAP platform or between systems. Lots of companies are struggling with keeping this organized and reconciled. Again, this is a focus of auditors due to the impact on the group results.

Inventories lock up a big part of a company’s asset value. Reserved stocks (called special stocks in SAP) for Projects or Make to Order jobs can hide a lot of leftovers. Each company ends up building some kind of solution for slow moving and obsolete items, but price inaccuracy has a major impact too. Again volumes are high making automated analyses necessary to get insight.

Finance to controlling reconciliation is needed especially when multiple submodules in Controlling are used like CO Profitability Analyses (COPA). SAP has strong integrations and validations build in making it harder to cause discrepancies, but incomplete closing activities or system set up flaws can still cause FI and CO to be out of sync with COPA being the most error prone. Even though Simple Finance is going to address some of this, there are still many hand-offs between FI and CO.

Solutions

Staying on top of the data quality in your ECC system is good housekeeping and pays off tremendously in terms of reporting reliability and easy audit approvals. Having a plan and the tools in place to manage it is the first step, having the discipline to stay on top of it and adding it to your KPI reporting is the second.

My recommendation is that in finance data quality analyses should be part of the monthly cycle and incorporated in the closing schedule. Keeping up is much better than infrequent big clean up exercises. Standard SAP offers standard reports, but often these are complicated, narrow focused and require configuration. Business Intelligence companies offer various data clean up services too. However, your ECC system is the source of your SAP Financial data and you need to keep records up to date in there and reconciled. Linking and reconciling the financials to data in other modules gives you full insight and the confidence the financial reports represent the state of the business.

DQM stands for Data Quality Monitor and consists of a suite of solution focused to cover all FICO areas your auditors will look at each year. Closing validation is vital for reliable Income Statement reporting in SAP and offers great value for (SOX) audits.