l3.f.gl2 period management

8/2/2019 L3.F.gl2 Period Management

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Period Management andClosing Operations

General LedgerL3.F. GL2 Session

October 12, 2006


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Agenda

Ground Rules & Introduction Project Timeline Work session Objectives SAP Terms Glossary

Business Process Review AS-IS process flow

Process Improvement opportunities SAP concepts & functionality Business process flow

Best practices & Benefits realization Organizational Impacts

Next Steps Action items Questions


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Ground Rules

Everybody participates blueprint is not aspectator sport

Silence means agreement Focus is key please turn off cell phones and

close laptops Challenge existing processes and mindsets Offer suggestions and ideas Think Enterprise Ask questions at any time

One person at a time please Timeliness returning from break


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Introduction

Roles Process Analyst and Functional Consultant lead and

facilitate the discussions and drive design decisions Documenter take detailed notes to support the formal

meeting minutes to be sent by the Process Analyst to allparticipants for review and feedback

Team Members provide additional support for processdiscussions, address key integration touch points Subject Matter Experts advise team members on the

detailed business process and participate in the decisionsrequired to design the future state business process

PRM Team Members transition assistance, controls

documentation, and risk assessment

Round the Room IntroductionsName

Position

Department or School


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What is BRITE?

BRITEBrowards Innovative Tool for Education

Our Vision One Business System for Broward Schools

Our Mission Adopt best practices and involve endusers to create one business system in SAP

Want to know more:

Visit our website at: http://web/erphttp://www.broward.k12.fl.us/erp
http://web/erphttp://www.broward.k12.fl.us/erphttp://www.broward.k12.fl.us/erphttp://web/erp


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Project Phases

Five Key Phases

Strategy & Approach Defined

Project Team Training

Business Process Definition

Development Requirements

Development & Unit Testing

Integration Testing

End-User Training Materials

User Acceptance

Technical Testing

End-User Training

Conversion

Go-Live Support

Performance Tuning

Pro

ject

Prepa

ration

Business

Blue

print

Realization

Go

Live

and

Sup

port

Final

Prepa

ration


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Project TimelineWaves Process Areas Specific Modules

Wave 1Finance/BudgetHR/PayrollProcurement

GL, AP, FM, CO, SEM-BPSPA, OM, PY, TM, TEM, e-Rec, BN, ESS, PD, PayrollMM, IM

Wave 2 Finance GM, CFM, AA, AR, PS, PBC

Wave 3 Plant Maintenance PM

FebMarApr ayJun Jul AugSepOct ovDecJanFebMarApr ayJun Jul AugSepOct ovDecJanFebMarApr ayJun Jul AugSepOct ovDecJanFebMarApr ayJun Jul AugSepOct ov

mySAP Wave s Proce ss Area s

Enterprise

Blueprint

All Functional

AreasBlueprint

Wave 1GL, AP, FM, CO, SEM-

BPS,PA, OM, PY, TM, TEM,eRec, BN, ESS, PD, Payroll,

MM, IM

Finance/Budget,

HR/Payroll,Procurement

Realization

Fina

lPrep

Go

Live

Wave 2GM, CFM, AA, AR, PS, PBC

Finance

Blueprint

Realizati

FinalPrep

Go

Live

Wave 3PM

Plant

Maintenance

Blue

print Realization

FinalPrep

Go

Live

BCPSmySAP

Implementation

2006 20092007 2008


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Project Organization Functional TeamsProject Management

Melissa Grimm (Project Mgt)Leah Williams (Project Mgt)

Finance/Budget Leads

Tom Campbell Finance Lead

Colleen Casey Budget Lead

Mary Ramsrud Consulting Lead

HR/Payroll Leads

Susan Rockelman HR Lead

Debbie Bouhenguel Payroll Lead

Patsy Burns Consulting Lead

Operations Team Leads

Robert Peinado Operations Lead

Jeetendra Kumar MM Consulting Lead

Bob ThomassonPM Consulting Lead

General Ledger

Accts ReceivableCost Accounting

Grants Mgt

Asset Accounting

Position Budget (PBC)

Cindy WadeSheeraz IqbalAccounts Payable

Cash ManagementFunds Management

Project Systems

Budget Prep (BPS)


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Blueprint Objectives

Review and discuss the current or As-Is business processes Which helps to drive out the Business requirements

As well as the integration pointswith other processes Define Master Data

Address key integration points Support organizational requirements

Consistent and appropriate use of data fields Define Future or To-Be business processes based on:

Best Practices inherent in SAP Intellectual capital from other SAP implementations The BCPS business requirements

Identify development requirements

Which could result in the need for a form, report, interface,conversion, or enhancement (FRICE) Understand and communicate any organizational impacts / Change

Management Gather system security authorizations and district-wide training

requirements


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Work Session Objectives

Month End closing process

Year End closing process

Period Control with determination of special periods

Cross Module and team integration


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AS-IS Controls Environment

Examples of existing controls around current businessprocesses: Authorization / approvals

Management approves purchases.

Reconciliation

Bank reconciliations

System Configuration

Three-way matching occurs in system

Data Interfaces, exception / edit reports

Rejected data is isolated, analyzed and corrected in a timely manner.

System Access

Access to post Journal Entries is restricted to authorized personnel

Management Review

Large and unusual cash disbursements are reviewed by management.

Segregation of Duties

Access to pay vendors is segregated from access to create vendors.


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Period Management and Closing Operations

As-Is Process Flow


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As-Is Process Flow



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The closing of a period is performed in threesets of steps: pre-closing, managerial closing,and financial closing.

Pre-Close activities ensure that all necessaryentries have been posted in the General Ledger(G/L), including entries from feeder systems/sub

ledgers and accruals and recurring entriesposted directly to the G/L. Pre-close activitiesoccur in both the old and new months.

Managerial Close activities involve the re-assignment of costs throughout the entireorganization, using the allocation and

settlement functionality provided withinControlling

Financial Close activities include finaladjustments to valuations and balances prior tothe final close and preparation of reports.Adjustments from the cost flows recorded in the

managerial closing activities are updated to FIthrough the reconciliation ledger posting.


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The closing of a period is performed in three sets of steps: pre-closing, managerial closing, andfinancial closing.

Pre-Close activities ensure that all necessary entries have been posted in the General Ledger

(G/L), including entries from feeder systems/sub ledgers and accruals and recurring entriesposted directly to the G/L. Pre-close activities occur in both the old and new months.

Managerial Close activities involve the re-assignment of costs throughout the entire organization,using the allocation and settlement functionality provided within Controlling

Financial Close activities include final adjustments to valuations and balances prior to the finalclose and preparation of reports. Adjustments from the cost flows recorded in the managerialclosing activities are updated to FI through the reconciliation ledger posting.


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To separate business transactions into different periods, a fiscalyear with posting periods has to be defined. The fiscal year isdefined as a variant which is assigned to the company code.

The fiscal year variant contains the definition of posting periodsand special periods . Special periods are used for postings whichare not assigned to time periods, but to the process of year-end

closing. In total,16 periods can be used. The system derives the posting period from the posting date. When

the posting date falls within the last normal posting period, thetransaction may be posted into one of the special periods.

Example: Above you see a fiscal year with 12 posting periods and4 special periods. If the posting date falls in the 12th period, the

transaction can instead be posted in one of the four specialperiods. Standard fiscal year variants are already defined in the system and

can be used as templates. Note: The fiscal year variant does not include the information as to

whether a period is open or closed; this is maintained in anothertable. The fiscal year variant only defines the amount of periods

and their start and finish dates.


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Use of Special Periods

Period 13 - Year-End adjustments prior to draft statements

Period 14 - Draft Statements including re-class entries

Period 15 - School Board generated adjustments for Audit purposes

Period 16 - Final statements including audit adjustments

Special periods need extra care when posting to them

Access to posting in the special periods should be limited to key staff


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DAY 0 - last day of the

month

DAY 1 DAY 2 DAY 3 DAY 4

Open next month's posting

period for FI-GL, AR, AP

& AA

Post all parked entries

(AP, AR, GL)

Post final AP invoices Record recurring expenses Perform FI reposting


period for CO

Complete all goods

receipt of the reporting

month (MM)

Maintain GR/IR account Transfer CATS time sheetpostings for activity

allocation

Run assessments forGrant


period for FM

Record payroll accrual Bank reconciliations (to

final hardcopy (Wave1)

Run CO assessments,

distributions, settlements

Resource related Billing

for reporting month

Complete and verifydaily interfaces andbatch jobs

Perform Purchasing

closing steps (e.g.

contracts, etc)

Complete Customerbillings for reportingmonth

Effect all fixed asset

transfers

Run & Verify MRP Perform Inventory closingsteps

Settle capital projects to

AuCs and final assets

Record accrued expenses,

assets and liabilities

Investment and debt

postings (interestaccrual, allocations,market valuation)

Run asset depreciation

Roll MM period Load last electronic bankstatement (EBS) for the

month (Wave2)

EOD: Close A/P period EOD: Close AA period EOD: Close A/R period

Review Schedule

Manager tasksReview Schedule Manager

task status

Late pm: Run pre-close

financial reports (eg.Trial

Balance for Fund, Grant,Project, etc


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DAY 5 DAY 6 DAY 7 DAY 8 DAY 9

Review pre-close reports Run FinancialAccounting comparative

analysis

Enter Agency Trial

Balances in SAPReverse accrual forinterest on investmentsand debt (Wave 1)

Reconcile fund-level

cash to investments &

cash on hand

Post final adjusting/ re-

class journalsReverse accruals in the new

reporting period

Complete bankreconciliations

Perform variance

analysis, as required

Transfer encumbrancefrom FM to FI

Calculate and post

adjustments, if any

EOD: Close CO period 5pm: Close G/L period

EOD: Close FM period

for reporting monthLate pm: Run final

financial reports

Inform all end-Usersthat Reporting month isclosed for postings

Late pm: Verify BW

extracts & reports


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POSTING PERIOD

Posting periods are defined in the fiscal year variant. To prevent documents from being posted to a wrong posting period, desired periods

can be closed.

Usually the current posting period is open and all other periods are closed. At theend of a period it is usually closed and the next period is opened. A period isopened by entering a range into the posting period variant which encompasses thisperiod. It is possible to have as many periods open as desired.

The posting period variant controls whether or not it is possible to post to a givenperiod or periods within either a single company code or a group of company codes.


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Month-End Closing


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Due to statutory requirements and/or company policies,the companys books may be closed and a new period

opened on a monthly basis.

The typical SAP fiscal closing spans 5-7 days after theend of the month. The goal is to eventually reduce it to 5days

The month-end closing process, using SAP transactions,

is provided in the following section.


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Month-End Closing Process

Open and ClosePosting Periods

(OB52)

CloseMaterial Master

(MMPV)

Generate List ofStock Values

(MB5L)

Reconcile: Daily Journal Entries (FB50) Daily Deposits (FB50) Weekly Journal Entries

Bank Charges and Credits (FB50)Vendor Checks Issued (FCHR)

Post (FB50): Depreciation Amortization Salaries Accruals/Deferrals Month-EndInsurance and Rent

Perform CostCenter Analysis

(S_ALR_87013612)

Create FinancialStatements

(S_ALR_87012284)


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You define posting

periods in your fiscal yearvariants. You can openand close theseposting periods forposting. As many periods asyou require can be openfor posting

simultaneously.

Usually, only the current posting period is openfor posting, all other posting periods are closed.At the end of this posting period, the period isclosed, and the next posting period is opened.

Open and ClosePosting Periods

(OB52)


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Special PeriodsPeriod Range

Closing a Posting Period and Opening a New One


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Some data (stocks and

certain valuation datasuch as total value,total stock, valuationclass, price control indicator,

and price unit) ismanaged by period.

For values and goods movements to be posted tothe correct period, the period must be setwhenever a new period starts.

CloseMaterial Master

(MMPV)


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MMRV providescurrent status.

MMPV closes Material Master recordsfor the old period and opens a new one.


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This list provides total stock

count and respectivevalues.

Totals

Details

Generate List ofStock Values

(MB5L)


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Reconcile Daily Journal Entries (FB50)

Use this transaction to enter G/L account postings on adaily basis.

Reconcile Daily Deposits (FB50)

The same transaction is used to reconcile daily,

lockbox, and credit card deposits.

Reconcile: Daily Journal Entries (FB50) Daily Deposits (FB50)


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This is a single-screen transaction. You can

enter, hold, park, and post documents on onescreen with a minimum amount of entries.

DebitCredit


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Bank Charges and Credits (FB50)

Use the same transaction used for daily reconciliations.This transaction is used to post bank charges, credits,

and other miscellaneous charges.

Vendor Checks Issued (FCHR)

Use this procedure to reconcile and post vendorchecks that have been issued.

Perform this procedure when the bank statementverifies payment to vendor.

Reconcile Weekly Journal Entries Bank Charges and Credits (FB50)Vendor Checks Issued (FCHR)


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Using the same transaction used to perform daily and weeklyreconciliations, at month-end, post the following:

Depreciation - allowance made for a loss in value of property

Amortization - the reduction of the value of an asset by prorating

its cost over a period of time Salaries the fixed compensation for services paid to a person on

a regular basis

Accruals the accounts on a balance sheet that representliabilities and non-cash-based assets used in accrual-based

accounting. These accounts include accounts payable, accountsreceivable, goodwill, future tax liability and future interest expense

Deferrals payments deferred to a later date

Month-End Insurance and Rent insurance and rent payments

Month-End Posting (FB50


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Perform this procedure when you

need to determine/report theresults of the balance sheet andprofit and loss statement.

Balance Sheet

Invoice-based closing for a group at a specific point in time(financial statements key date) in the form of a comparison ofassets and capital (liabilities and owner's equity).

Assets and capital reflect the same total value. This is expressedin the balance sheet (assets = capital).

Profit and Loss Statement Comparison of revenue and expenditure of a period to determine

the results for the company and the sources of these results.


(S_ALR_87012284)


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A cost center is an organizational

unit within a controlling area thatrepresents a defined location of

cost incurrence.

Use this procedure to display, review, and analyze costs

associated with cost centers.

Perform CostCenter Analysis

(S_ALR_87013612)


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Year-End Closing


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Due to statutory requirements and/or companypolicies, the companys books must be closed

and a new period opened on a yearly (annual)basis.

The December month-end closing process mustbe completed prior to performing the year-endclosing process.

The year-end closing process, using SAPtransactions, is provided in the following section.


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Conclude JuneMonth-End

Closing

Generate AccountBalances for Old

Fiscal Year(S_ALR_87012277)

Block OldFinancial Year

(OB52)


(S_ALR_87012284)

Carry ForwardBalance for

Receivables/Payables(F.07)


G/L Accounts(FAGLGVTR)

Generate ForwardAccount Balances for

New Fiscal Year(S_ALR_87012277)


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The G/L account balance list shows the followingfigures:

Balance carried forward at the beginning of the fiscalyear

Total of the period or periods carried forward

Debit total of the reporting period

Credit total of the reporting period

Debit balances or credit balances at the close of thereporting period (optional)

Generate AccountBalances for Old

Fiscal Year(S_ALR_87012277)


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This program calculates the balance carried forward for

customers and/or vendors. The balances of the previous year are carried forward to

the new year. If the account has not yet been posted inthe new year and no balance carried forward has beencarried out for this account, the account is opened in thenew year with the 1st balance carried forward; otherwise,the balance carried forward of the account is stored in thenew year if changes result.


Receivables/Payables(F.07)


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When posting into a previous year, the system carriesforward the balance automatically. This is independent of

whether the program has already run or not. "posting to aprevious year" means that the posting date of thedocument has an earlier year than the entry date.

This automatic carrying forward also occursaccumulatively over several years that means a posting inJanuary 1993 with the posting date December 1991changes the balance carried forward for 1992 and 1993.


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Carry Forward Balance forReceivables/Payables (F.07)

When posting into a previous year, the system carriesforward the balance automatically. This is independent ofwhether the program has already run or not. "posting to aprevious year" means that the posting date of thedocument has an earlier year than the entry date.

This automatic carrying forward also occurs

accumulatively over several years that means a posting inJanuary 1993 with the posting date December 1991changes the balance carried forward for 1992 and 1993.


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Carry Forward Balance for

Receivables/Payables (F.07)

SAP recommends that the program is run at the beginning ofthe new fiscal year.

If the program is already run at the end of the last fiscal year,postings which are posted after this to the last fiscal year, donot result in automatic adjustment of the balance carriedforward because it is not a "posting to a previous year".

In such a case, it is necessary to let the program run againafter these postings to carry forward the postings enteredlater.

P i d M d Cl i O i


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Carry Forward Balance for

Receivables/Payables (F.07) The program can be started as often as desired. Nevertheless, you can post to the new year if the program

has not yet run. When posting, the accounts, however,

with a balance carried forward of greater than zero areopened.

Postings in the previous year do increase this balancecarried forward, but do not carry forward the total of theitems already posted in the old year to the new year; thebalance carried forward only has the items posted by thenew year into the previous year, but not the items postedin the previous year itself.


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Carry Forward Balance for G/L

Accounts (FAGLGVTR)

This process involves carrying forward account balancesinto the new fiscal year. The balance to be carried forwardis shown in the account balance display. To carry forwardbalances, you can use separate programs for G/L

accounts, and for customer and vendor accounts.

You therefore do not even have to carry out the balancecarry forward manually if you have already posted to thenew fiscal year.


G/L Accounts(FAGLGVTR)


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Carry Forward Balance for G/L

Accounts (FAGLGVTR) The transaction is executed as follows:

Balance Sheet and Customer and Vendor Accounts

The balances on the balance sheet accounts are simply

carried forward into the new fiscal year. Additional account assignments are transferred.

Profit and Loss Accounts

Profit and loss accounts are carried forward to retained

earnings accounts. The balances of the profit and lossaccounts are set to 0.

Additional account assignments are not transferred.

Transaction currencies are no longer applicable and theprofit and loss accounts are summarized in local currency.


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Generate Forward Account Balancesfor New FY (S_ALR_87012277)

This is the same transaction as generating forwardaccount balances for old fiscal year.

Generate ForwardAccount Balances for

New Fiscal Year(S_ALR_87012277)


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Create Financial Statements

(S_ALR_87012284)

As part of the year-end closing, individual companiescreate financial statements according to country-specificregulations.

This is the same transaction as creating external reportsdiscussed in the month-end closing process.


(S_ALR_87012284)


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Block Old Financial Year (OB52)

This is the same transaction as opening andclosing posting periods discussed in the month-end closing process.

Block OldFinancial Year

(OB52)


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Profit and Loss Statement Report

S_PL0_86000028 this transaction executes theProfit and Loss statement and provides informationfor actual/actual comparisons.

P i d M d Cl i O i


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General Ledger Account Balance Report

S_PL0_86000030 this transaction generates a GeneralLedger account balance report.

P i d M d Cl i O i


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Additional Closing Transaction

T-Code ReportTitle

Use this transaction to

ACACCARRYFORWARD

AccrualCarryForward

Carry forward already posted accruals from theaccrual engine. After data carry forward, accrualscan be posted in the same year. This transactioncan be run in test mode.

Use the work instruction to perform this additional Closing transaction.



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Additional Closing ReportsUsing the reporting features provided in the SAP Basics and

Navigation Course, you can execute and use the followingadditional reports when needed.

T-Code Report Title Use this transaction to

S_ALR_87012026 DepreciationForecast

Run a report on depreciation.

S_ALR_87011981 PhysicalInventory List

Display inventory of assets in company code.

S_ALR_87012006 DepreciationStatement

Display all depreciation postings for selected assets to aspecific date.

S_ALR_87012394 Record of Useand Sales Taxes(USA)

Display customer/vendor types totaled by jurisdiction code andtax base amount along with total tax.

S_ALR_87012287 DocumentJournal

Display all posting periods with reference to documents(created monthly).

S_ALR_87012289 CompactDocumentJournal

Display the most important data from document headers anditems in a table format for selected documents.

S_ALR_87012291 Line Item

Journal

Display a journal report at the line item level for selected

posting documents.



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Additional Closing Reports (continued)

T-Code Report Title Use/Results

S_ALR_87012293 Display ofChangedDocuments

Display a list of charges made to various documents.Selection is by company code, document number, year,etc.

S_ALR_87012342 Gaps inDocument

NumberAssignment

Display a gap in the document number assignment anddocuments assigned more than once.

S_ALR_87012333 G/L Accounts List Display a list of G/L accounts by company code or Chartof Accounts.

S_ALR_87012341 Invoice NumbersAllocated Twice

List of Invoices applied twice for a vendor

S_ALR_87012342 Gaps inDocumentNumberAssignment

Document Numbers Missed by System

S_ALR_87012346 Recurring EntryDocuments

List displays all recurring entry documents

P i d M t d Cl i O ti


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Schedule Manager

Schedule Manager can be used as the central tool to schedule and monitor all transactions andprocesses related to the closing process. It provides a good overview of the status of theclosing and contains various means of automating and providing reminders for tasks. Thefollowing main areas will be explored and utilized:

Task List components available in the task list are used to structure the period closing process

Workflow (to schedule series of jobs, which need to be run sequentially)

Background jobsOn-line programs or transactions that are executed directly from within Schedule Manager

Text reminders for non-SAP tasks, e.g. reconcile fund-level cash to investments and cash onhand.

Scheduler - shows tasks that have been completed on a specified day, or where action needs tobe taken. The calendar requires entries to be made for a given day at a certain time.

Monitor - functionality provides:

Detailed job status (spool lists, job log) for a given task

View messages related to given tasks

Work List - better handling of errors. Faulty objects do not go through to the next step, but arelogged for review.

Ownership of this tool should rest with the Controllers Office, since this office bears ultimate

responsibility for ensuring that the books are closed on an accurate and timely basis. One person, witha backup, should be designated to run the Schedule Manager and monitor the status of the tasks.



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Perform monthly and annual close

Develop and communicate comprehensive monthly and annual closingschedules

Establish monthly cutoffs to facilitate timely monthly closings

Closing should be centrally controlled and managed to ensure that all stepsare completed timely and in sequence

Closing schedule includes the closing of all modules and the closing shouldbe controlled by Finance

All adjusting entries should be posted in the ERP system

System should provide extended periods for closing entries

Best Practices
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Next Steps


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