A comparison between Consolidation in SAP BPC and Group Reporting 2022 on premise

[marijnbax2]

SAP group reporting is now 6 years old after its first release in may 2017. BPC has been around since 2007 since it was bought from Outlooksoft. Several versions of BPC have been around since its first release; Standard, Embedded, optimized and a Microsoft version. In this article I’ll try to compare the functionalities of BPC Standard (as this is the mostly used version) compared to what has so far been develop in Group Reporting version 2022 on premise by taking into account some of the main aspects of the consolidation process.

1. Data Collection / Data Entry


2. Master Data


3. Validation


4. Logic / Enhancements


5. Ownership and Consolidation of Investments


6. Reporting


7. Security


8. Process Flows

 

1.      Data Collection / Data Entry

Group Reporting seamlessly integrates with S4 accounting. There is standard functionality in the data monitor to import the data from S4 (ACDOCA). Standard mapping tables are available in FIORI apps to map GL accounts to FS (Financial Statement) items. The system indicates any unmapped items as a means of pre validation. On loading the data there is a clear overview of the amount of records loaded and load errors are indicated. For any data that is not available in an underlying S4 system one has to use a flat file upload or journal upload. Alternatively the GRDC (group reporting data collection) licence can be purchased to have additional functionality for collecting and reclassifying  data. This is especially relevant for organisations that do not have all of their company codes running on S4 HANA operational accounting. Input schedules can be created and API's are available to Collect data similar to the EPM add in in BPC. The extension ledger also provides additional functionality by means of a single entity being able to post to multiple consolidation units and

In BPC one has to manage data manager packages that point to transformation and conversion files. Setting these up is a bit more complex compared to how it’s done in group reporting as you have to manage separate files/worksheets for each conversion. It does offer similar flexibility. One member in the source can be mapped to an other one in BPC potentially also with the use of “if” formulas.

2.      Master Data

Group reporting has the benefit that some master data Items can be sourced from the S4 systems and therefore don’t need dual maintenance or replication. This goes for instance for Profit Center, Cost Center, GL account, WBS element, Customer, Material Number, Vendor etc. This goes as well for any hierarchies that these dimensions could have.

The downside is that the master data that is not sourced from S/4 (FS Item, Reporting Item, Movement Type, Functional Area, Posting Level, Document type etc.) , Need to be manually replicated across the DTAP landscape. This goes for all configuration that is done in Fiori Apps. So Reporting Rules, Global Hierarchies, Validations, FS Items etc all need to be manually replicated in all systems.

Group Reporting does not seem to have any issues with having 40+ dimensions, where with a standard BPC Consolidation implementation normally you would not go beyond 12. Having this far more granular data is a big benefit of Group Reporting. One could think of doing management consolidation and management reporting out of the group reporting.

Group Reporting delivered content comes with predefined FS item attributes. Creation of new attributes is not supported. This is really a limitation once you are in a more complex environment.

3.      Validations / Controls

Validations and controls don’t differ that much between the two products. Both have functionality to break down the validations further by movement type and or functional area. BPC does have far better functionality to build validations reports in the EPM add in. We’ll get back to this on the reporting part. Group Reporting has the ability to include more than 2 dimensions in a validation wh

4.      Logic / Enhancements

Group Reporting has functionality to include a Badi as one of the process steps in the data or consolidation monitor but there is no such thing in as BPC’s default logic. Default logic get’s executed every time data is loaded or entered into the system. This gives a lot of flexibility with regards to reclassifying data as well as to transfer the  net income to the balance sheet so that this is always up to date

5.      Ownership and Consolidation of Investments

Entering ownership of subsidiaries in Group Reporting is not as straight forward as it is in BPC. Group Reporting does not have an ownership model neither does it have an ownership manager. Instead, you have to make a download of your equity and investment accounts, and reverse out the amounts, then bring in the amounts again but with a percentage ownership against the share accounts. In my opinion this is really a step back compared to BPC.

Equity pickup is again a manual process in Group Reporting. After having done the configuration of the accounts, you can make a download, that needs to be turned in to a journal upload file in the parent company. In BPC this can be fully automated.

In group reporting you have the choice between activity based and Rule based consolidation of investments. In the activity based version SAP have pre-configured the eliminations. The only thing that needs to be competed is to tag FS Items with the correct properties. The limitation is that a property can only be used for 1 FS item. Personally, I would always go for rule based to remain flexible and future proof. The rule based consolidation of investments does not differ that much from BPC Reporting

6.      Reporting

The tool is called Group “Reporting” but it does not really live up to its name. The Fiori Apps; Group Data Analysis (with reporting rules) are a bit comparable to the BPC web reporting functionality. It’s just a drag and drop of dimensions with no ability to (conditional) format, suppress, local calculations, Layout, Retrieve Cells etc like what is possible in the EPM add-in in BPC. Group Reporting also offers the possibility to report out of Analysis 4 Office which gives better functionality than Fiori and now with new features like Local Members and Formula based reports it's getting a lot closer to the capabilities of the BPC EPM Add-in.

Of course SAP’s strategic reporting tool is Analytics Cloud but this requires an additional licence. It also requires data to be persisted in SAC as with a live connection the reporting capabilities are also quite limited. Another option would be to use a last mile software like disclosure management, but again this requires and additional licence. BPC outperforms Group Reporting by far on this topic.

In group reporting 2023 a Financial Statement Reporting Booklet will be introduced, (which is already available in the cloud version). this app has had some positive feedback from customers. Reporting rules in Group Reporting also offer on the fly calculations of a combination of FS Item, Subitem (Transaction type or Functional Area), Consolation Unit, Document Type and reverse sign. This functionality is quite strong except for when it needs to be interfaced to BW / SAC. Indirect Cash Flow and a PL by Function can easily be created with these rules.

7.      Security

Security in Group Reporting is done the same way as it is done in S4 Accounting, whereas in BPC a separate security administration is needed. Having the roles and profiles managed by the S4 Team gives an economy of scale.

8.      Process Flows

Standard Processes in data- and consolidation monitor are available. Since Group Reporting is most relevant to customers that have all their data in S4 accounting, the process integrates less well with linking to means of reclassifying data in input schedules as well as to reviewing data in reports. BPC has a customization function in terms of BPF and designing a Custom Menu in Excel. This integrates much better with the EPM add-in for input schedules and reports.

So why would you move to group reporting

Well, first of all; SAP is not giving you much choice as the support (depending on your version) will stop within the next 4 years. Second would be that Group Reporting is SAP’s strategic consolidation solution moving forward. In particular for customers who are using or implementing S4 HANA operational accounting. This is irrespective of the deployment option (cloud or on-premise). It would make sense to have each and every company live on a single S4 instance as otherwise one would have to set up temporary interfaces until the moment these companies go live on S4. Central Finance could also be used but this again requires an additional licence. There is a big benefit for companies that have (most of their) companies live on S4 accounting as the data integration, granularity and analysis are much better than BPC’s. The downsides are that BPC, being the mature product that it is, has better functionality in other area’s. Let’s hope that SAP keeps investing in Group Reporting to make it the complete product that BPC already is and to have to great data integration that Group Reporting already has.

With regards to an implementation of group reporting it makes sense to have the requirements sessions together with S4 Operational Accounting but to start the implementation after S4 Operational Accounting has gone live. As the two systems are interlinked, changes in S4 Operational Accounting could also affect Group Reporting which will result in additional effort.