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, 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

The decision may translate into business rules which enforce the decision and will require configuration. List these business rules here. For example, "An Outline Agreement cannot be created via the RFQ process. An awarded RFQ can only result in a Purchase Order". 

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

1. Every legal entity on its own and 100%-owned by Syensqo should be a company code set up in S/4.
2.  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.
3.  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. 
4.  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.
5.  Entities using a different non-SAP ERP system must not be created as a company code in S/4 HANA. If required for consolidation purposes, trial balances of such entities must be loaded into the consolidation system directly.
6.  Every entity will be created as a company in the Consolidation system due to group reporting requirements.

Evaluation

Outline why you selected a position. The best format could be a pro/con table (sample below), but is up to you as the author. You must consider complexity, feasibility, cost/effort to implement, but also ongoing operational impact and cost. You must consider the program principles and explain any deviations in detail. This is probably as important as the decision itself.

	Option A	Option B	Option C	Option D
Criterion 1	Pro Con	Pro Pro	Pro Con	Pro Con
Criterion 2	Pro Con	Con	Pro Pro	Con Con
Criterion 3	Pro	Con	Con	Pro

See also

Insert links and references to other documents which are relevant when trying to understand this decision and its implications. Other decisions are often impacted, so it's good to list them here with links. Attachments are also possible but dangerous as they are static documents and not updated by their authors.

Change log

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