Background and the need for Workflow in ICMR
I was so excited to see the automatic adjustment postings functionality in ICMR. ICMR is so user-friendly that the user can create 10-15 different matching methods and corresponding automatic adjustments in a very short time.
The downside is that the number of auto-posted adjustments can quickly get out of hand. I have seen users creating adjustments for thousands of dollars with no one to oversee or monitor the postings. In one extreme example, two users created identical matching methods making duplicate adjustments for the same difference.
Soon we realized that having someone monitor and control your auto adjustments is critical from an internal control perspective and for the accuracy of the books.
What will the adjustment Workflow help achieve in ICMR?
That’s where we leverage the flexible workflow approval and control functionality. Having a workflow to monitor and review your adjustments will get the control back to the organization and add a layer of transparency and audit trail. You can set limits for what needs approval and how many people need to approve it before it gets posted. You can go one step further to create approvals for differences that don’t need adjustments. The email notifications allow users to get timely notifications, so there is no hold-up for month-end close.
A note on Flexible workflow
We have come a long way in how we used to handle workflow vs how we do it these days. Setting up and using a flexible workflow is a breeze compared to the hoops we had to go through earlier. Everything I show here doesn’t need any technical knowledge and can be done by the functional consultant.
In this blog post, I will walk you through the step-by-step process of how to set up and use workflow effectively with email notifications.
Step 1: Ensure your reason codes have the correct workflow assignments.
Reason codes are a separate topic in itself, and I have published a separate blog post on this topic.
https://blogs.sap.com/2022/03/28/a-deep-dive-into-matching-methods-and-reason-codes-in-icmr/
For the purposes of workflow setup, you need to ensure that the standard workflow is assigned in the reason configuration, as shown below.
- If you need just the workflow triggered for approval, you need to populate WS78500087 for the workflow Scenario ID.
- If you need to post the adjustment after the approval of the workflow, ensure you populate the Adjustment class as shown below. There is a further step for an adjustment that I will explain in the workflow steps below.
Reason codes with Workflow assignment
Step 2: Create a flexible workflow
The next step is to create a workflow using the app “Manage workflows for Intercompany variance Adjustments.”
- The order of workflow is essential.
- You can change what gets triggered first and next using the define order button.
- SAP delivers a standard workflow that can be used as a template. Its indicated with a package icon shown below
- You cannot change the standard workflow. We can copy from the standard and create our own version of it.
- You can activate or deactivate a workflow depending on what you need to trigger.
Workflow Definition screen
- In this example, I am creating a workflow for a variance adjustment posting that exceeds $100. We have a one-step approval and an automatic posting step.
- Note that the second step is necessary to post the adjustment. If you don’t want to post, you can skip this step.
Workflow definition and steps overview
Workflow step Variance adjustment posting
Role/ Agent assignment: You can determine the approver by role or Team (Created in the app ‘Manage teams and responsibilities’)
You can assign by role or by a team (Created in the Manage teams and responsibilities app)
- One or all of the recipients’ button allows you to determine if all the team members in the group have to approve or if any one of the team members’ approval should be good to go.
- If you select All, the workflow will not be approved unless every team member approves.
Workflow Step to check variance adjustment.
- The second step is straightforward. It’s determined automatically once step 1 is successful.
- Hence you can see that there is no agent determination for this step
- But this is nessasary for the adjustment posting
- Do not forget to activate the workflow step after you are done saving
Note: SAP wont allow you to change the workflow configuration once its activated even if you deactivate it later. Its designed that way to avoid people circumventing internal controls. This is very important. People who have burnt their hands at building secure workflows can relate to this.
This step allows for posting the adjustment after approval
Step 3: A look at the Matching method step that we will use to trigger the workflow
- The data I have choosen for this example is a matching of an AR and AP invoice across company codes
- I have set that the matching should happen with the reason code TA0899.
- TA0899 has the workflow assigned in the configuration as we have seen in the screenshots of the earlier steps.
Matching Method and step 1/2
Matching method and step 2/2
Step 4: Workflow Execution
Let’s run the matching method and see the workflow in action. Here is the matched data that has a difference of $110. This should trigger a workflow when I click on ‘Process.’
A look at the data before we trigger the workflow. I click on the Process button next to the trigger.
The workflow status is in Progress. That means it’s waiting for the Agent to approve.
Here is the workflow is in the inbox of the approver. He can approve or reject or review the items.
Once the workflow is approved, the adjustment posting is posted automatically, as shown above.
Here is the adjustment posting posted after the approval
Email Notifications
The advantage of flexible workflow is that the Email notifications can be seamlessly triggered for every process step. Since this blog post is already long, I would recommend reading the excellent blog post on this article by Rosaria below. It shows the setup in Cloud, but the steps are similar for an on-prem system.
https://blogs.sap.com/2022/01/12/how-to-set-up-the-email-notification-for-flexible-workflow-in-sap-s-4hana-cloud/
Conclusion:
SAP addressed a practical business problem with the use of adjustment workflow and in-app communication
I gained a newfound appreciation for the importance of this once I have seen the things that can go wrong
When you have teams operating across various geographies and cultures, its paramount to ensure that a complex functionality like ICMR has robust approvals and checks and balances.
Further reading
I have a series of blogs on Group reporting ICMR and SAP finance. Some of the related blog links are given below.
Eliminate profit in Inventory with IPI in group reporting.
Reason codes and Matching methods in ICMR
https://blogs.sap.com/2022/03/28/a-deep-dive-into-matching-methods-and-reason-codes-in-icmr/
Q&A
Feel free to ask any questions or share your experience in the comments section below. I will try to answer questions as soon as I can. Alternatively, you can reach out to me on my LinkedIn page below. Follow me there for further updates,
https://ca.linkedin.com/in/naveen-pidikiti
