] Brenda Hagen, Allison Transmission

Rajkishore Una, GyanSys Inc.

Managing Financial Consolidation in ECCS

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Agenda

Introduction

About Allison Transmission

About GyanSys

Allison SAP System Landscape

Drivers for Implementation

Why Allison chose ECCS vs. Others

Project Scope

Team Structure

Future State

Integration with other modules

Implementation Tips

Business Benefits

Key Learning

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Abstract

Description: Discover how Allison Transmission is planning to implement the enterprise controlling-consolidation function in SAP ECCS for financial consolidation. This session covers the solution's functionality, including specific constraints and lessons learned in meeting the reporting requirements of a group that comprises multiple diverse operating entities from various global regions.

Key Learning Points: * Facilitating an auditable business process * Uniform data collection and warehousing * Platform for efficient and accurate reporting

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About Allison Transmission

The world leader in the design, manufacture and

sales of commercial-duty automatic transmissions

for on-highway trucks and buses, off-highway

equipment and military vehicles.

The company holds an 80% market share of all

medium- and heavy-duty commercial fully

automatic transmissions produced.

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About Allison Transmission

Founded in 1915 by James Allison

Headquartered in Indianapolis

Five international regional offices: The Netherlands, Japan,

China, Singapore, and Brazil.

Presence in more than 80 countries, which includes over

1,500 distributors and dealers.

Workforce of over 4,000 salaried and hourly employees.

Owned by GM until August 2007 when sold to two private

equity firms: Onex Corporation and Caryle Group

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About GyanSys

Head-quartered in Indianapolis since 2001

Provides cost effective innovative solutions using Onshore,

Offshore and Near-shore delivery models

Specializes in FSCM, PLM, CRM, SCM, HCM, SRM and other

business suites on BI & Portal

Extensive experience Project Management, Change

Management and Business Process Reengineering

Ongoing Partnership with SAP on Product testing and

Education

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Allison System Landscape

Implemented FI (GL, AR, AP, SPL), CO (CCA, PCA, CO-PA, IO), PS, SD, MM, WM, PP in 2001

Upgraded to ECC 6.0 from 4.6C in Dec 07

Sandbox, Development, Quality & Production systems

One FI company is live in SAP

Currently implementing FI-AM, HCM, Unicode upgrade, Portal, BI and rolling out SAP to international affiliates

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Drivers for Implementation

Divestiture

Owned by GM and sold to Private Equity Groups in Aug’07

SAP implementation geared towards to support business requirements of a division of a company not as separate financial entity

Consolidation was done at Corporate Level

Current State

Manual and Excel based solutions

Time-consuming during multiple iterations

Resource Risk

Audit Risks

Not Transparent

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Why Allison chose ECCS over Others

BW was on 3.1 and the process of being upgraded

Rapid/Quick implementation

ECCS is stable and well understood

Simpler business requirements and for Actual only

Real-time update from FI/CO

BI-BCS/OutlookSoft requires ECC integration besides additional licensing cost

Hyperion requires interface and extra system resource requirements

New tools will have ongoing support implication

Lower Implementation cost since team size is small

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Project Scope

Phase I

Standalone ECCS

Flexible File upload for all entities

New Group COA

Legal Consolidation

Allows focus of attention on core consolidation functions first E.g. exchange rate translation, elimination, adjustment entries,

validation rules etc.

Phase II

Real-time Update from FI

Assigning new Group COA to Operational COA

Requires “Trading Partner” in all inter-company postings

Additional validations/substitutions rules

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Team Structure

Full Time:

1 Financial Accountant

1 ECCS Functional Consultant

Part-Time

Business Process Owner

IT Project Manager

ABAP Resource

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Future State:

Prepare

Master Data

Consolidation Groups Hierarchy

Financial Items Hierarchy

Additional Sub-Items (e.g. Functional Area)

Additional Characteristics (e.g. Segment)

Break-down Categories (e.g. Trading Partner)

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Future State:

Collect (Data Monitor)

Method of Update

Flexible file upload (Phase I)

Real-time update from FI (Phase II)

Periodic Extract

Roll-up through SPL

Adjustment Entries

Manual

Automatic Re-class

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Future State:

Collect (Data Monitor)

Currency Translations

Unique exchange rates for B/S (month-end) and IS

(average)

US FAS52 compliant (e.g. Equity at historical rate)

Different than FI revaluation

Same central exchange rate table in SAP (OB08)

Finite control over each FS Item being translated

Leverage Versions for different types of translations

for other GAAP requirements

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Future State:

Collect (Data Monitor)

Retained Earnings

Automatic calculation of current year retained earnings at every consolidation cycle

Validation

Data integrity checks

TB (BS & IS) must be equal to zero

Assets = Liabilities + Shareholder’s Equity

Avoid errors in case of Flex-file upload

Sense checks

Any other business rules

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Future State:

Consolidate (Consolidation Monitor)

Inter-unit elimination

Can be done for both BS (I/C AR and AP) and IS (I/C

Revenue & COGS)

Multiple Steps within each method

Control Mechanism in case of differences

Task can be performed multiple times in test mode

Validation

Similar checks in Group Currency

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Future State:

Consolidate (Consolidation Monitor)

Adjustment

Similar entries in Group currency

Consolidation of Investment (Out-of Scope)

Required in case of Minority Interest calculation

Overkill in case of 100% of ownership

Time Consuming and Complex

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Future State:

Analysis

Database Listings report (CX34) is the most

powerful report

Standard delivered reports are not sufficient

Developed a custom ALV report with comparative

analysis

BW standard delivered extractors are planned to be

leveraged in the future

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Future State:

Integration with other modules

ECCS Consolidation Unit maps to FI Company not FI Company code

FI Group COA maps to ECCS FS Items hierarchy

Custom Characteristics can be derived automatically without any enhancements – e.g. Segment, Functional Area, Plant etc.

Requires FI Trading partner as a basis for elimination (cross-company postings, inter-company Stock Transfer)

Simultaneous postings in ECCS, FI and sub-ledger document and drill-down capability

Method of entry can be changed from Flexible Upload to real-time update as Companies go-live in SAP

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Implementation Tips :

Help file:

http://help.sap.com/printdocu/core/Print46c/en/data/

pdf/ECCS/ECCS.pdf

Custom characteristics can not be transported.

OSS Note: 402968

All master data are transportable

Data can be deleted if required (CXDL)

Test system only

Upload file formats (Flexible !!!!) are easily

configurable

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Benefits :

Graphical with Status Icons

Ability to upload multiple times

Lock vs. Un-lock..

Restrict the users to specific entity

Control environment

Consistent manner

Allows different methods for different entities

R/3 and non-SAP company codes

Data integrity and Accounting Sense Checks

Identify differences between I/C account and specify on how to treat them (Alert and Control mechanism)

Ability to check proper inter-company posting at the time of origination

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Key Learning:

Define the internal business process first before

system implementation

Dedicated full-time business resource

Manageable scope and team focus

Implement in Phases (Walk before Run !!!!!)

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Speaker Contact Information

Brenda Hagen

Allison Transmission, Manager of Accounting

E-mail: brenda.hagen@allisontransmission.com

Raj Una

GyanSys Inc., Senior Solution Architect

E-mail: raj.una@gyansys.com

Please visit GyanSys Booth 484 for more details

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