Status
Owner	Anil Para
Stakeholders	The business stakeholders involved in making, reviewing, and endorsing this decision. Type @ to mention people by name

Purpose

The purpose of this document is to define the conversion approach for RE-FX Contract and Lease Management (CLM) master data and balances in S/4 HANA.

The main object of RE-FX migration is Lease contract master and balances. Due to the technical structure of RE-FX, there are also several tightly connected migration objects such as Business Partners  (i.e., Vendors), Right of Use (RoU) Assets & their balances, and GL Liability balances. The scope of this conversion specification is the Lease contract master records. Migration of Lease contracts are however dependent on the other objects mentioned above to migrate Lease contracts and their balances completely and accurately.

Group entities currently using SAP ECC solution shall use S/4 HANA CLM for IFRS 16 Lease Accounting in SyWay. S/4 HANA CLM provides a standardized framework, single source of truth and processes for a streamlined management of lease contracts across all Syensqo group entities directly in S/4 HANA  

Conversion Scope

The scope of this document covers the approach for converting active IFRS 16 Lease Contracts from Legacy Source Systems into S/4HANA following the RE-FX Contracts MDS Standard. The BPML process for RE-FX contracts will be followed as below

Level-1	Level-2	Level-3	Level-4
9. Finance	9.5 Perform Transactional Accounting	9.5.6 Perform Lease Accounting	9.5.6.2 Manage Finance Lease Contracts
			9.5.6.3 Manage Lease Contract Adjustments
			9.5.6.4 Manage Lease Contract Terminations
	9.7 Perform Financial Close	9.7.1 Period-End Close	9.7.1.11 Manage Real Estate Close
	9.12 Perform Financial Reporting	9.12.1 Perform Operational Reporting	9.12.1.4 Perform Operational Reporting for Lease Accounting

The following ROU Asset Classes from legacy are applicable for this conversion. Corresponding S/4 HANA asset classes will be added later.

System	Asset Class	Description
WP2	AC231001	Leasing - Real Estate - Land
WP2	AC233001	Leasing - Real Estate - Office Building
WP2	AC233002	Leasing - Real Estate - Employee Lease Apartments
WP2	AC233003	Leasing - Real Estate - Storage Space
WP2	AC234001	Leasing - Real Estate - Cars
WP2	AC234002	Leasing - Real Estate - Railcars
WP2	AC234003	Leasing - Real Estate - Containers / Trailers
WP2	AC234004	Leasing - Real Estate - Other Vehicles
WP2	AC235001	Leasing - Real Estate - IT Hardware
WP2	AC235002	Leasing - Real Estate - Computers
WP2	AC235003	Leasing - Real Estate - Office Equipment
WP2	AC235004	Leasing - Real Estate - Others Tangible
WP2	AC237001	Leasing - Real Estate - Industrial Equipment
PF2	ZLE23101	Leasing - Real Estate - Land
PF2	ZLE23301	Leasing - Real Estate - Office Building
PF2	ZLE23302	Leasing - Real Estate - Employee Lease Apartments
PF2	ZLE23303	Leasing - Real Estate - Storage Space
PF2	ZLE23401	Leasing - Real Estate - Cars
PF2	ZLE23402	Leasing - Real Estate - Railcars
PF2	ZLE23403	Leasing - Real Estate - Containers / Trailers
PF2	ZLE23404	Leasing - Real Estate - Other Vehicles
PF2	ZLE23501	Leasing - Real Estate - IT Hardware
PF2	ZLE23502	Leasing - Real Estate - Computers
PF2	ZLE23503	Leasing - Real Estate - Office Equipment
PF2	ZLE23504	Leasing - Real Estate - Others Tangible
PF2	ZLE23701	Leasing - Real Estate - Industrial Equipment

The data from legacy system includes:

1. IFRS 16 Lease contracts - Lease contract master data and balances
2. ROU Assets - Right of Use Assets and Balances
3. Lease Liabilities - Short Term and Long Term Lease Liability Balances
4. Accrued Lease Liability - Intermediatory Lease liability balance
5. Business Partners - Vendor Business Partner master data with a specific RE-FX role
6. Purchase Order - Need a further check on the Lease POs strategy?

The data from legacy system excludes:

1. Inactive Lease Contracts
2. Deactivated ROU Assets
3. Lease contracts will be ended equal to go-live date

List of source systems and approximate number of records

Source	Scope	Source Approx No. of Records	Target System	Target Approx No. of Records
PF2	RE-FX Lease Contracts and ROU Assets	1,781	S/4 HANA	Will be same as Source, unless any new contracts and/or deactivation before Go-live
WP2	RE-FX Lease Contracts and ROU Assets	2,022	S/4 HANA	Will be same as Source, unless any new contracts and/or deactivation before Go-live

Additional Information

Multi-language Requirement

IFRS 16 Lease Contracts will primarily be managed in English

Document Management

N/A

Legal Requirement

There are no legal requirements relevant to data migration of IFRS 16 Lease Contracts

Special Requirements

Specify any special requirements or considerations that may impact the data conversion process based on specific locations, regulatory compliance or system limitations. Clearly outline any regional or localization requirements such as country-specific data formats, legal reporting obligations or industry standards that must be adhered to (e.g., localization rules for countries like China).

If the data conversion involves third-party systems or external data sources, such as Icertis, describe any additional requirements related to data mapping, transformation logic, validation rules or security measures that must be followed.

Target Design

With Functional input, document the technical design of the target fields that are in the scope of this document.

The technical design of the target for this conversion approach.

Table	Field	Data Element	Field Description	Data Type	Length	Requirement
VICNCN	BUKRS		Company Code	CHAR	4	Mandatory
VICNCN	RECNNR		Contract Number	CHAR	13	Mandatory
VICNCN	RECNTYPE		Contract Type	CHAR	4	Mandatory
VICNCN	RECNTXT		Contract Description	CHAR	80	Optional
VICNCN	RELEVANTEVAL		Valuation Relevance	CHAR	10	Optional
VICNCN			Purchasing Document
VICNCN	RECNTXTOLD		Number of Old Contract	CHAR	20	Optional
VICNCN	RECNCNCURR		Currency	CHAR	5	Optional
VICNCN	KEY_ID		Line ID	CHAR	2	Mandatory
VICNCN	TERM_NO		Term Number	CHAR	4	Optional
VICNCN	OBJTYPECN		Business Object Type of Contract	CHAR	2	Optional
VICNCN	OBJDCN		ID Part of Contract Object	CHAR	45	Optional
VICNCN	XCNSUBJECT		Name for Contract Term	Text	60	Optional
VICERULE	ACCTOBJNR		Account Assignment Object	CHAR	45	Mandatory
VICERULE	CNSUBJECTTYPE		Type of Contract Object	CHAR	6	Optional

Data Cleansing

ID	Criticality	Error Message/Report Description	Rule	Output	Source System
DC-1	Medium		Terminated or concluded lease contracts must be closed and all related postings need to be completed.	Data cleansing to deactivate and exclude terminated or concluded contracts	SAP ECC
DC-2	Medium		Lease - Suspense account balances to be cleared	The balances are to be closed to 0 for any terminated or concluded contracts. Open items are to be cleared as much as possible.	SAP ECC

Conversion Process

The high-level process is illustrate by the diagram below:

Data Privacy and Sensitivity

Summarize Data Privacy and Sensitivity Requirements, if any

Extraction

The IFRS 16 Lease contract master data records shall be extracted from SAP ECC and shall be migrated using the Syniti Migrate / lease migration template. There are 2 possibilities:

1. The data exists. Syniti Migrate connects to the source and loads the data into Syniti Migrate. There are 3 methods:
   1. Perform full data extraction from relevant tables in the source system(s).
   2. Perform extraction through the application layer.
   3. Only if Syniti Migrate; cannot connect to the source, data is loaded to the repository from the provided source system extract/report.
2. The data does not exist (or cannot be converted from its current state). The data is manually collected by the business directly in Syniti Migrate. This is to be conducted using DCT (Data Collection Template) in Syniti Migrate

The agreed Relevancy criteria is applied to the extracted records to identify the records that are applicable for the Target loads

Extraction Run Sheet

Req #	Requirement Description	Team Responsible
ERS-1	Firstly, go to table ANLA (Asset Master Record Segment) and filter based on BUKRS (company code) and ANLKL (Asset Class) that are in scope during the deployment. Ensure that the DEAKT (deactivation date) is blank. After, retrieve the table results.	Data team
ERS-2	Based on the result from ERS-1, proceed to table ANLZ (Time-Dependent Depreciation Terms). Filter the details based on BUKRS (company code), ANLN1 (main asset number) and ANLN2 (asset sub number). Next obtain the entries for asset master data time-dependent details.	Data team
ERS-3	Based on the result from ERS-1, proceed to table ANLB (Depreciation terms). Filter the details based on BUKRS (company code, ANLN1 (main asset number) and ANLN2 (asset sub number). Next obtain the entries for asset master data depreciation areas details.  Note:  i. One asset will consist more than one line item depending on the number of depreciation areas that is setup in the legacy ECC system ii. Take note of NDJAR (planned useful life) and NDPER (planned useful life in periods)	Data team
ERS-4	Based on the result from ERS-1 and ERS-3, proceed to table ANLC (Asset Value Fields). Filter based on BUKRS (company code), ANLN1 (main asset number), ANLN2 (asset sub number), GJAHR (Fiscal year) and AFABE (depreciation area). Take note of AFBLPE (Period for the last depreciation posting), then, retrieve the cumulative values. i. KANSW (Cumulative acquisition and production costs)  ii. KNAFA (Accumulated ordinary depreciation)i ii. NAFAG (Ordinary depreciation)	Data team

Selection Screen

If applicable, this section will give the details on any selection screen parameters, including the parameter type, that are required to be entered to ensure consistent data extracts.

Selection Ref Screen	Parameter Name	Selection Type	Requirement	Value to be entered/set

Data Collection Template (DCT)

Target Ready Data Collection Template will be created for Data Object data with exception of some fields which require transformation as mentioned in the transformation rule.

<Object> DCT Rules

Field Name	Field Description	Rule

Extraction Dependencies

List the steps that need to occur before extraction can commence

Item #	Step Description	Team Responsible
ED-1	RoU Assets of contracts that are retired will not be migrated	Data Team
ED-2	Contracts which are already concluded and no longer valuated shall not be migrated however their assets shall only be migrated if the asset is still in use	Data Team
ED-3	Total NBV of the RoU assets are to be compared with total RoU Asset GL balance for each of the ledgers	Data Team
ED-4	Total lease liabilities of the downloaded list of contracts are to be compared that they match the total short and long term lease liabilities in GL for each of the ledgers	Data Team

Transformation

The Target fields are mapped to the applicable Legacy field that will be its source, this is a 3-way activity involving the Business, Functional team and Data team. This identifies the transformation activity required to allow Syniti Migrate to make the data Target ready:

1. Perform value mapping and data transformation rules.
   1. Legacy values are mapped to the to-be values (this could include a default value)
   2. Values are transformed according to the rules defined in Syniti Migrate
2. Prepare target-ready data in the structure and format that is required for loading via prescribed Load Tool. This step also produces the load data ready for business to perform Pre-load Data Validation

Transformation Run Sheet

Item #	Step Description	Team Responsible

Transformation Rules

Rule #	Source system	Source Table	Source Field	Source Description	Target System	Target Table	Target Field	Target Description	Transformation Logic

List of Custom Target Reports for this object is maintained here: Conversion Specification - Custom Reports Register.

Transformation Mapping

Use the exact name and reference this section in the “Transformation rules” above

Mapping Table Name	Mapping Table Description

Transformation Dependencies

List the steps that need to occur before transformation can commence

Item #	Step Description	Team Responsible

Pre-Load Validation

Project Team

The following pre-load validations will be performed by the Project Team.

Completeness

Task	Action
title	specific details of what and how the task needs to be performed e.g. which reports are being used etc.

Accuracy

Task	Action
title	specific details of what and how the task needs to be performed e.g. which reports are being used etc.

Business

The following pre-load validations will be performed by the business.

Completeness

Task	Action
title	specific details of what and how the task needs to be performed e.g. which reports are being used etc.

Accuracy

Task	Action
title	specific details of what and how the task needs to be performed e.g. which reports are being used etc.

Load

The load process includes:

1. Execute the automated data load into target system using load tool or product the load file if the load must be done manually
2. Once the data is loaded to the target system, it will be extracted and prepared for Post Load Data Validation

Load Run Sheet

Item #	Step Description	Team Responsible

Load Phase and Dependencies

Identify the phase as to “when” the load for this object will occur. <Pre-Cutover, Cutover, Post Cutover> and list the steps that need to occur before the load can commence

Configuration

List the Configurations required before loading can commence

Item #	Configuration Item
1	Company Code
2	Contract Types
3	Valuation Rules
4	Conditions and Condition Purpose
5	Contract Object Types
6	Tax Type and Tax Group
7	Valuation Relevance
8	ROU Asset Classes
9	Fixed Asset - Legacy Transfer Date
10	ROU Assets Number Ranges
11	Contract Number Ranges
12	Business Partners with specific Role
13	GL Accounts
14	Cost Centres, Profit Centres and Functional Area
15	Discounted Interest Rates

Conversion Objects

Object #	Preceding Object Conversion Approach
	list the exact title of the conversion object of only the immediate predecessor – this will then confirm the DDD (Data Dependency Diagram)

Error Handling

The table below depicts some possible system errors for this data object during data load. All data load error is to be logged as defect and managed within the Defect Management

Error Type	Error Description	Action Taken

Post-Load Validation

Project Team

The following post-load validations will be performed by the Project Team.

Completeness

Task	Action
title	specific details of what and how the task needs to be performed e.g. which reports are being used etc.

Accuracy

Task	Action
title	specific details of what and how the task needs to be performed e.g. which reports are being used etc.

Business

The following post-load validations will be performed by the business.

Completeness

Task	Action
title	specific details of what and how the task needs to be performed e.g. which reports are being used etc.

Accuracy

Task	Action
title	specific details of what and how the task needs to be performed e.g. which reports are being used etc.

Key Assumptions

• Master Data Standard is up to date as on the date of documenting this conversion approach and data load.
• Data Object is in scope based on data design and any exception requested by business.

Any additional key assumptions.

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