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Practical Tips for Designing Forward Looking Statements in SAP Analytics Cloud

One of the key elements in the Financial Planning and Analysis (FP&A) is forward looking P&L statements. Reporting of forward-looking information is a critical component of effective communication to the market. Forward looking P&L statements integrate actual data for the past with plan data for the future, combining both revenue and costs related datasets together.

FP&A Plan to Optimize Financials cycle can be represented as follows:

In the conceptual model for forward looking P&L statements we should define KPIs for planning, plan input forms, relevant reports, planning processes, user groups, roles and responsibilities, etc. We need to identify what will be our sources for actuals, who and when will maintain budgets and forecasts, what will be the review and approval cycles.

Below is an example of a planning process diagram for an international organization generating revenue by project, and planning costs by cost center, cost element group. The organization has an annual budget approval cycle, and multiple rolling forecasts during the year. Controllers at profit centers mange plans for their units, review them with controllers in Divisions and Group. At the same time OPEX cost center planning/forecasting is done both at Profit Centers and at Divisions/Group.

This kind of process diagram can serve as a starting point for the EPM application design and clarification of the business planning process building blocks.

Table of Contents

  • Define a Conceptual Planning Process Diagram 1

  • EPM Design Components 2

  • Ways of Integrating Actuals to EPM 3

  • Define Granularity for Planning 3

  • Define Input Forms Used in Planning 4

  • Role of Master Data Hierarchies 4

  • Locking Plan Figures for Closed Periods Automatically 5

  • Financial Consolidation Steps 5

  • Technology Behind the Solution 6

  • Final Words 6

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Design forward looking P&L in SAC
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