FERC Reporting Options on SAP

Utilities on SAP, learn everything about FERC reporting options on SAP S/4HANA and SAP ECC at next week's SAP for Utilities conference in San Diego. HPC America will share its 25 years of experience in utility accounting and the SAP ERP.

On Tuesday, Oct. 22 at 1:10pm, HPC's customer Salt River Project will present its case study about FERC optimization and preparation for migration to SAP S/4HANA. SRP implemented HPC Utility Financials Accelerator (UFA) in 2018 in order to eliminate reconciliation differences between GAAP and FERC, speed up the monthly trace, and improve other regulatory reporting processes and results. HPC UFA is a NetWeaver-based add-on software solution that eliminates the delivered FERC module's inherent limitations, and runs on both SAP ECC and SAP S/4HANA. Read the full SRP case study and learn more about HPC UFA.

HPC's latest software innovation is HPC DECIPHER, an add-on regulatory financials solution that is certified by SAP as integrated with SAP S/4HANA. HPC DECIPHER provides real-time reporting and takes full advantage of the line items in S/4HANA's Universal Journal (table ACDOCA). It translates transactions from natural to regulatory accounts as they are posted, eliminating period-end batch processes, and uses dedicated, parallel ledgers for full FERC details. HPC DECIPHER also includes comprehensive functionality for allocations, adjustments, and cost flow forensics directly in the ERP. Learn more about HPC DECIPHER for real-time regulatory (FERC) reporting on SAP S/4HANA.

To schedule a meeting with HPC at the 2019 SAP for Utilities conference, please contact us.

Continuous Accounting for Utilities on SAP S/4HANA

For too long, utilities have been beholden to batch accounting processes that delay financial analysis, obscure timely visibility into job spend, and hinder proactive mitigation of variances. The “monthly close” is such a foundational element of the business that it’s hard to imagine not relying on it. 

It doesn’t have to be this way, however, and HPC America’s vision for the future is decidedly different. When utilities move to SAP S/4HANA, they have a tremendous opportunity to get more timely, actionable financial information without waiting for period-end, by taking concrete steps towards “continuous accounting.”

Get the Continuous Accounting white paper (PDF)

Why Continuous Accounting Matters
At HPC, we think of “continuous accounting” as embedded, real-time, or otherwise automated processes that replace traditional period-end batch processes. Continuous accounting processes generate valuable financial data on a more regular and frequent basis than the monthly close alone. A utility with a continuous accounting model would enable its analysts and managers to evaluate and take action on operational performance, spend variances, and other business metrics without having to wait for a period-end report.

For example, collecting functionalized cost data in real time would allow analysts to identify and correct mischarged postings before month-end, thereby making the actual closing process less error-prone. Likewise, loading overheads more often than monthly would provide project managers with fully loaded cost views of their projects mid-month, which would in turn enable them to adjust resources proactively in the current period instead of reacting after the period has been closed.

Six Ways to Continuous Accounting on SAP S/4HANA

(1) Functionalize costs at the point of data entry instead of in a batch process at month-end.
Replace the derivation-based FERC solution that’s delivered with S/4HANA with a real time, line item design. There are a number of ways to do this, depending on how much flexibility and control your utility needs. One is to use HPC’s latest add-on software for utility financials on S/4HANA, HPC DECIPHER, which is certified by SAP as integrated with SAP S/4HANA, and eliminates the FERC module that we created 25 years ago.

(2) Minimize cost flow streams...
by reducing (or eliminating) allocations and settlements that only serve to functionalize costs. Streamlining cost flows is an underappreciated but valuable effort, and every utility moving to S/4HANA should consider it carefully. We have great experience and can help.

(3) Activate Functional Areas...
to leverage the Universal Journal’s power to record and report generation, transmission, and distribution costs right from the general ledger (not just from Controlling or the FERC module). We first did this for We Energies in 2012, then again for Cleco on S/4HANA in 2018, and we’ve just started a new Functional Area project for another utility

(4) Collect job costs daily, if not more frequently.
As mobile devices become ubiquitous throughout the enterprise, labor entry should occur in real time when technicians complete their Plant Maintenance tasks, even before they leave a job site.

(5) Run overheads after every pay period, or even more frequently.
In conjunction with more timely direct labor entry, apply your indirect labor and overheads more often, perhaps even weekly. This will fully load costs for job managers, project managers, and program managers to gain insights into total spend much earlier than waiting for the month-end close.  

(6) Modernize the availability and presentation of financial data.
Use Fiori apps to access a P&L statement at any time of the month, from any device, and use nested, real-time drill-down reports to show how job order costs roll up to the income statement. Get multi-dimensional data on the fly in S/4HANA without the need for ETL processes customary with separate OLAP servers like BW or BOBJ.

How to Get Started
To learn more about how your utility can best get closer to continuous accounting—say, starting with a functionalized income statement mid-month—contact HPC for a discussion, or meet us at the 2019 SAP for Utilities conference in San Diego on October 21-23.

2019 SAP for Utilities Conference - Meet HPC America

Meet HPC America at this October's SAP for Utilities conference to learn more about two key subjects for utility company IT, Customer Service, and Finance leaders:

1. Lessons learned from managing the first-ever—and only in-production instance of—SAP C/4HANA Service Cloud (aka, C4C) integrated with on-premises IS-U Billing.


2. FAQ about FERC reporting on SAP S/4HANA. We've got detailed pros and cons of four different options for regulatory accounting on S/4: the delivered FERC module, an optimized FERC module, a basic line item (real-time) model, and an advanced line item model.  

In addition, HPC's customer Salt River Project (SRP) will present our recent optimization of FERC on SAP Suite on HANA utilizing HPC Utility Financials Accelerator (UFA) add-on software (check out SRP's full case study, too). 

We're also going to walk conference attendees through the benefits of our latest regulatory financials solution, HPC DECIPHER, which is certified by SAP as integrated with SAP S/4HANA and helps utilities fully leverage the Universal Journal's capacity for continuous accounting.

Contact HPC America in advance to schedule an appointment with our utility industry experts and SAP solution architects. 

Innovation for Utilities on SAP Since 1994

Big news: 2019 marks HPC America’s 25th anniversary. We first got our start in the United States in 1994, after a decade of success in Germany, when SAP's Hasso Plattner asked HPC AG’s founder, Josef Heck, to assist with the SAP ERP implementation at Pacific Gas & Electric. HPC America’s primary contribution was the creation of the first regulatory accounting solution for utilities on SAP — the “FERC module” that is still delivered with SAP S/4HANA to this very day (not that we’d recommend you continue to use it alone - but more on that later).

Since that time, HPC has demonstrated an unmatched track record of pragmatic consulting services and innovative add-on software solutions for utility companies on SAP. For utilities large and small, public and investor-owned, we’ve optimized accounting processes, streamlined cost models, made functionalized financial data more meaningful, and, ultimately, helped our amazing customers get more out of their investments in SAP.

Most recently, we led the first-ever integration of SAP C/4HANA Cloud for Customer with on-prem IS-U billing, establishing a powerful, flexible CRM system for NTUA that leverages their existing SAP ECC without further taxing their lean IT department. And our latest add-on solution, HPC DECIPHER, is certified by SAP as integrated with SAP S/4HANA and enables utilities to replace old FERC batch processes with a modern, line item model that generates better data, much faster.

Credit for HPC’s endurance over the last 25 years must go to our incredible team of people. Their functional and technical SAP skills are strong, and they continue to learn more as the technology has evolved. They bring years of utility industry knowledge, many having been former utility company employees, and that first-hand understanding of the business of a utility resonates deeply with our customers. Guys, your competency is tremendous, and we wouldn’t be here without you.

To see how HPC’s 25 years of dedication to utilities on SAP can benefit your company, meet us in two weeks at SAPPHIRE 2019 at Booth 346A. We can share insights on how SAP C/4HANA works in the real world, walk you through a demo of HPC DECIPHER, or talk about anything else on your mind about SAP Financials, Work Management, Billing, and CRM for utilities on SAP. Contact us to schedule an appointment in advance.

HPC DECIPHER® 1.0 Achieves SAP-Certified Integration with SAP S/4HANA®

We’re pleased to announce that our software solution HPC DECIPHER® 1.0 has achieved SAP certification as integrated with SAP S/4HANA®. The integration helps utility companies to realize greater accounting transparency, speed up the monthly close and, ultimately, strengthen rate-case positions with the most defensible cost of service data.

HPC DECIPHER builds on HPC America’s nearly 25 years of experience advising utilities on SAP solutions. It leverages the Universal Journal in SAP S/4HANA for modern, line-item-based regulatory financials . HPC DECIPHER eliminates time consuming batch processes, and includes real-time translation, powerful allocations, insightful cost flow forensics, and other useful utility accounting functionality.

The SAP® Integration and Certification Center (SAP ICC) has certified that HPC DECIPHER version 1.0 integrates with SAP S/4HANA 1610 using standard integration technologies. SAP S/4HANA is the next-generation business suite, built for the SAP HANA® platform, with on-premise and cloud deployment options. It is designed to act as the digital core, helping customers drive digital transformation across their entire organizations, taking advantage of the award-winning, role-based user experience of SAP Fiori®.

“We are delighted that HPC DECIPHER has achieved certified integration with SAP S/4HANA,” said Jerry Cavalieri, CEO of HPC America. “The ability of DECIPHER to interoperate with SAP S/4HANA gives utility company controllers, rates, and IT professionals an even stronger business case to upgrade to SAP S/4HANA.”

Learn more about HPC DECIPHER at the 2018 SAP for Utilities conference in San Antonio, Texas from October 15-17, 2018.

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HPC DECIPHER is a registered trademark of HPC America.

SAP, SAP S/4HANA, SAP HANA, SAP Fiori and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of SAP SE (or an SAP affiliate company) in Germany and other countries. See http://www.sap.com/corporate-en/legal/copyright/index.epx for additional trademark information and notices. All other product and service names mentioned are the trademarks of their respective companies.

#SAP4UTL Take-Aways About FERC Reporting on SAP S/4HANA

Like some of you attending the 2016 SAP for Utilities conference earlier this week, we had the opportunity to learn and talk about different approaches to regulatory accounting on SAP S/4HANA. FERC reporting has historically been an obscure topic, but it’s getting more airtime as utilities consider carefully the business case for, and impact of, moving to S/4HANA or S/4HANA Finance ("Simple Finance").

In the course of discussing FERC processes and results with #SAP4UTL conference attendees, we validated that HPC’s new design for real-time reporting on S/4HANA will in fact meet the needs of utilities adopting SAP’s in-memory platform. The software solution we introduced at the conference, HPC DECIPHER, has a light architecture: it runs natively on the Universal Journal, and doesn’t entail the use of a second HANA system running in parallel (or any additional hardware for that matter). As well, HPC DECIPHER does not require SLT replication of master data or coding block changes.

Bigger picture, we determined that HPC DECIPHER reinforces — even clinches — the business case for SAP S/4HANA in several ways. 

By making the most of SAP’s new technology, HPC DECIPHER translates GAAP to Regulatory accounts in real-time, directly in your S/4HANA server; eliminates GAAP-FERC reconciliation issues; functionalizes operational costs with the most granular level of detail; allocates common costs by utility code or line of business; generates full Financial Statements with drill down to all regulatory line items; enables easy, controlled reversal and reposting of regulatory data; identifies all cost flows traced from start to finish—and in reverse—with drill-down to details; and translates the fixed asset sub-ledger to regulatory accounts (e.g., the 300 series for FERC) directly in S/4HANA, thereby creating the potential to reduce the use of some costly third-party fixed asset solutions. And HPC DECIPHER does all of this, and more, without the legacy FERC module.

So, if you, too, discussed real-time FERC reporting on S/4HANA at the SAP for Utilities conference, and are now asking questions about regulatory reporting on S/4HANA, please contact HPC to chat about HPC DECIPHER — or to simply pick our brains. As you may already know, we’ve specialized in FERC reporting for utilities on SAP for a long time, since the very beginning, and our unmatched expertise will benefit most utilities transitioning to SAP S/4HANA.

SAP S/4HANA Add-On: HPC DECIPHER for Real-Time Regulatory Financials

HPC America is pleased to announce its latest innovation for utilities on SAP^® S/4HANA: HPC DECIPHER for real-time regulatory financials.

HPC DECIPHER is an ABAP-based software application that runs natively on the SAP Universal Journal. It provides the most comprehensive translation, allocation, adjustment, reporting, and forensics for utilities on SAP S/4HANA or S/4HANA Finance. HPC DECIPHER delivers greater accounting transparency, stronger rate case positions, and improved back-office efficiency.

Key Benefits for Utilities on SAP S/4HANA

• Translates GAAP to Regulatory accounts in real-time, directly in S/4HANA or S/4HANA Finance
• Portions line items to multiple regulatory accounts
• Allocates common costs, such as those from shared services, by utility code
• Generates full Financial Statements with drill down to all regulatory line items
• Eliminates the need for lump-sum journal entries that lose valuable transaction details
• Enables easy, controlled reversal and reposting of regulatory data
• Improves responsiveness to regulatory inquiries, and strengthens rate case positions
• Establishes one version of the truth between GAAP and Regulatory views

Read the full product description of HPC DECIPHER.

Learn More at the SAP for Utilities Conference #SAP4UTL

Utilities can learn more about FERC reporting on SAP S/4HANA and the benefits HPC DECIPHER delivers at the SAP for Utilities conference in Huntington Beach, CA, October 10-11, 2016. Meet HPC America at booth #39 to discuss SAP S/4HANA adoption strategies and alternative approaches to regulatory accounting for utilities on SAP S/4HANA. Schedule a meeting with HPC now.