| Status | Approved |
| Owner | |
| Stakeholders |
Issue
In Syensqo all the companies are created as company codes in the ECC system irrespective of whether the company code is operational or not. This added to the complexity of configuring the system and month-end / year-end closures.
Recommendation
Background & Context
A company is a structure within S4 HANA used to identify intercompany relationships and facilitate legal and management consolidation within the consolidations system and a company code is an organisational unit used in financial accounting representing an organisation’s independent legal entity. In Syensqo current systems, all companies are set up as company codes in the ECC system, regardless of whether they are operational or not. This approach has led to increased complexity in system configuration and has made month-end and year-end closures more challenging. The presence of non-operational company codes adds unnecessary layers to financial processes, complicating the overall system management and potentially leading to inefficiencies during critical financial reporting periods.
Assumptions
None at this point
Constraints
None at this point
Impacts
Following are the impacts
Data Conversion and migration: Data from the As-Is systems need to be mapped based on the proposed Company code Structure
Downstream System: There will be an impact on all the downstream systems that use Company code and there should be a one-time remediation or mapping exercise that should be undertaken
Business Rules
Options considered
Following are the options proposed for the issue
Option A: Follow the As-Is Structure i.e. Create company and company code for all the entities
As a part of this option the company and company code is created for all the entities that are in scope of consolidation
Option B: Create Company for all the entities and company code only for the operational entities
As part of this option, company code is created only for the operational entities
| Type of company arrangement | In legacy ECC | Ownership | Syensqo as Operator | Consolidation | Company | Company Code | Business Rule |
|---|---|---|---|---|---|---|---|
| 100% Owned by Syensqo and consolidated | Yes | Yes | Yes | Yes | Yes | Yes | Every legal entity on its own and 100%-owned by Syensqo should be a company code set up in S/4. |
| JV Entity | Yes | No | Yes | Yes | Yes | Yes | Every company code that is a JV entity in nature where Syensqo acts as the operator, must be created in S/4 HANA as a company code. |
| JV Entity | Yes | No | No | Yes | Yes | No | Every company code that is a JV entity in nature where Syensqo acts as the non-operator, must not be created in S/4 HANA as a company code. |
| Entities non-consolidated | Yes | No | No | No | Yes | Yes | Entities that are not consolidated, must not be created as a company code in S/4 HANA unless it's a JV operator entity or an active entity in legacy SAP or if it's been set up as a company code in ECC. |
| Entities non-consolidated | No | No | No | No | No | No | Entities that are not consolidated, must not be created as a company code |
| All other consolidated entities | Any | Any | Any | Yes | Yes | No | Every entity will be created as a company in the Consolidation system due to group reporting requirements. |
Evaluation
Option A: Follow the As-Is Structure i.e. Create company and company code for all the entities | Option B: Create Company for all the entities and company code only for the operational entities | |
|---|---|---|
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| |
| Criterion 2 |
|  Con |
| Criterion 3 |  Pro | Con |
See also
Change log
Workflow history
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