SAP MDG is especially used for master data management in companies that have lots of GL accounts, customer, vendor data, etc. Managing all this data manually obviously needs huge effort to handle.
Central Finance also uses different master data from various source systems, at this point, if this mapping process is performed manually then this would be ineffective to get real-time data. Because of this reason, SAP MDG provides remarkable value for companies which has complex different systems.
Central Finance offers integration to Master Data Governance to access available mapping information there. You can map your different accounting entities (for example, account, profit center, or cost center) in your source systems to one common set of master data in the central system to establish a common central reporting structure.
SAP TRM provides the treasury manager with an instant snapshot of cash effects and enables prompt distribution of cash to the strategic areas and different divisions of the company. At the same time, the manager can acquire cash in times of need from the most competent and inexpensive source. It is an integrated solution that helps in generating cash and simplifying operations. The integrated treasury and cash management process will provide additional benefits to the company’s finance function, leading to more accurate prediction of cash impact on the company.
So, having Treasury and Risk Management on every related system may have some downsides such as being more costly, master data conflicts, in this context, Central Finance offers the possibility to setup TRM on top of a harmonized dataset that’s updated in real-time.
All following TRM applications will be available with Central Finance capabilities :
Central Payment for SAP Central Finance allows you to make centralized payments and perform centralized clearing activities in the Central Finance system instead of each source system.
In case of Central Payment’s activation for a specific company code, open-item processing of all customer and vendor accounts for this company code is transported totally to the Central Finance system. Relevant customer and vendor open items are reproduced in Central Finance system so all connected open-item processes regarding customer and vendor must be moved to Central Finance system.
Benefits of Central Payment;
SAP Credit Management allows companies to handle risk via real-time credit allocation, monitoring and making faster credit decisions, lower transaction costs by automating credit application and approval processes, reduce DSO through reducing payment delays and bad debt and decrease the rate of credit refusal and improve relationships by focusing on profitable customers.
The main benefits of Credit Management; Faster, more reliable credit decisions with full documentation and easy audit trail, reduced sales order delays, order suspensions and cancellations to worthy customers, lower costs and reduced demands, reduce bad debt write-offs.
Local payment and Central Payment processes need to be taken into consideration while deploying Central Credit Management in Central Finance. To enable the update of credit exposure, Ale and web service scenarios must be used in any case. Besides, if local payment is used then the clearing status of open items must be sent to Central Finance system to feed credit exposure.
SAP Dispute Management provides functions for processing receivables related dispute cases. The dispute cases occur in case of customers deduction from invoiced amount or customers holding back payment. The AR Items which are in conflict are marked as a dispute and an object is created against the item.
A dispute case is a process to keep the reason for the disputed item, the information of the personnel following up on the same and the various stages of communication on the same. As the dispute is resolved, the case is closed with a suitable action.
One of the scenarios of integration Dispute Management with Central Finance is through the Central Payment function. Open item processes must be taken place in Central Finance system if Central Payment is activated, So the dispute cases would be created from that customer open items. Otherwise, in the local payment scenario, Central Finance system needs to be connected to source system to take open item information to create the dispute case and also update dispute case status.
SAP Collection Management provides collection strategies that allow to select and prioritize customers for the collection of receivables. The creation of daily worklists that based on collection strategies is triggered automatically by the system for collection specialists.
According to the collection strategy, the organization takes the advantage of customer’s prioritization, identification and evaluation. Daily worklists improve user productivity and efficiency, which could be brought possible income from customers in the short-term.
In terms of Collection Management integration with Central Finance, the same conditions are available as Dispute Management as being used open items for Collection Management process. In case of Central Payment activation, all open items will be in the Central Finance instance so no need for the additional integration except open items. In other case, local payment, to create collection strategies the Central Finance system will need open items and that causes other possible Ale, web service integration scenarios.
Most of the big companies prefer simple, agile and reliable financial tools to make decisions right time and this purpose might be difficult to handle due to structure of companies that generally have several systems as SAP or NON – SAP.
As a summary, SAP recommends SAP Central Finance solution for organizations to create value for their partners.
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