With more and more corporates moving their workloads to the cloud and in many cases in a staggered manner many found themselves with a unique situation where some workloads were on cloud while others were on prem. In such a scenario, a strong need was felt by the CFOs and accountant community to have a one stop application on the cloud which could provide a single source of truth from a period end close perspective
The AFC solution from SAP provides a closing hub in the cloud for all corporate entities, regardless of their operative accounting system and can be truly positioned as a solution for close orchestration. This closing hub is called as SAP S/4 HANA Cloud for Advanced Financial Closing (AFC). This single solution to automate, manage and steer all closing processes of an enterprise ensures efficient and auditable financial closing and reporting. SAP Advanced Financial Closing is deployed in the cloud and is available as software as a service (SaaS). The AFC is hosted on SAP BTP providing extensive extensibility options
This is a logical evolution in the Period End closing space. Indeed AFC has come a long way from the days of manual entries to excel entries to Corporates already using SAP S/4HANA as an operational ERP system where some closing steps of the legal entity close are no longer necessary, as the Universal Journal integrates the General Ledger with the subledgers and with the cost accounting module
The next logical step that the CFOs and accountants would be looking forward to is to integrate such cloud solutions with Group Reporting, offering a holistic solution framework as well as to further automate remaining manual tasks for example by using Intelligent RPA to automate chains that include several steps in different applications and require cognitive abilities
All these advancements help Corporates to meet and exceed one of their key KPI, that of ensuring as short a duration of the period end close as feasible that causes least disruption to business
It is indeed very riveting to see how new technologies have over the years helped reduce the manual element involved in this most critical task that every accountant can never escape from thereby reducing the overall duration of a period end close!
As a CA article clerk back in the mid 1990s I have seen how accountants used physical ledgers and other manual aids like writing up a trial balance and P/L using large sized paper. In the late 1990s and early 2000s software applications like Tally and other home grown applications helped automate and to some extent ease the workload involved during period end closes. The 2000s and 2010s saw further advancements in this area where large ERPs like BAAN, Ramco Marshalls, SAP and others provided rapid reduction in the period end close durations. With the onset of cloud and other Industry 4.0 technologies, latest innovations like SAP AFC have only taken this progress a notch further up!
