Introduction

In today's rapidly changing business world, financial data governance is critical for companies looking to remain efficient and compliant. SAP Master Data Governance for Financials (SAP MDG-F) provides a comprehensive financial data governance solution that ensures accuracy and consistency across the enterprise.

SAP Master Data Governance (MDG) is an advanced master data management platform. It supports centralized creation, modification and distribution of master data across your entire system landscape. It also provides the ability to consolidate all master data across the entire IT landscape. Continue reading here for general information about SAP MDG.

SAP MDG is available by default for various domains as shown below.

In this blog we focus specifically on SAP Master Data Governance for Financials (MDG-F). SAP MDG-F is SAP's standard solution for centrally managing financial master data. It offers a centrally positioned application for managing and controlling the master data, regardless of whether the master data is processed locally or centrally. The financial master data can be created, supplemented and modified in the so-called staging area. In this staging area the master data is not yet available for the underlying business applications. The master data is only made available for actual use once the data has been checked, supplemented and approved. This setup can be used for various types of financial master data, such as controlling area, account schedules, cost centers, general ledger accounts, company numbers and controlling objects such as profit centers and cost centers with hierarchies. The MDG-F solution is made available to end users via ABAP Web Dynpro and SAPUI5 (Fiori), which offers the necessary flexibility to adapt to the requirements and wishes of end users.

Why MDG-F?

A problem that many companies encounter nowadays is that a lot of information used for business operations is duplicated or incorrectly stored in systems. For example, when a cost centre occurs multiple times in a system such as "Avelon"or "avalon", then there's a real chance some bookings won't or will be overlooked. Consequences of this in turn may be that ultimately there will be less profit, more costs or late payments.

Performing a good and reliable audit becomes a challenge with duplicated data present in the system. The audit will take more time to analyze and allocate the duplicated data properly, which will ultimately result in a longer turnaround time and higher costs. In addition to inefficiency, there will also be an increased chance of incorrect reporting.

MDG-F is ideally suited to raise the quality and consistency of financial data to a higher level. It ensures consistency of data between local and enterprise systems, where there is only one source and therefore only one truth, data models are standardized, validation of data can be set up company-wide but also locally and workflows are available to guide application, change and approval processes. As a result, reliable information can easily be retrieved from the system, data is consistent and data modelling, planning and analysis will improve.

For an Excel file detailing all fields in MDG-F, see SAP note 2021246 MDG Financials- (Un-) Supported Segments and Fields.

What's MDG-F?

MDG-F supports the 3 main areas in financial accounting, namely Accounting, Controlling and Consolidation. This is reflected in the hierarchy below.

SAP MDG-F Financial Accounting Hierarchy

Because all entities in this hierarchy are linked, it becomes more complicated to create incoherent or inconsistent data. This creates, as it were, a web of aligned and linked master data.

Various validation options can be used so that only allowed and correct content is managed. SAP MDG-F also offers the possibility to store draft versions of master data or incomplete records that do not yet meet all validation requirements. However, before final approval can be given, all validation requirements must be met, so that incorrect or incomplete data never ends up in the underlying business systems.

Editions

Throughout master data processes, time-dependent checks on master data release are not taken into account. Within MDG-F, however, this is standard, because so-called Editions (or versions) are used. All change requests within MDG-F, also for new objects, are collected in one edition and released on a certain date. Time-dependent objects automatically receive their validity from the validity dates of the parent edition. After an edition is released, all change requests in the edition are only made available to the underlying systems. In addition, an edition can only be released when all change requests in the edition have been completed; i.e. approved, rejected, or revoked. When the edition is released, a validation is performed for all change requests in the edition. If any inconsistency is found with this validation, the edition cannot be released and the errors found must first be resolved. In this way MDG-F ensures that only consistent and correct supply of master data to the linked business systems takes place.

When an edition is created, MDG-F automatically determines the date from/to when the edition is valid, based on already existing editions. In this way, there can be no overlap between different editions. An edition can only be valid until the validity of a new edition.

By way of illustration:

Edition A is valid from 01/2019 to 12/9999.
- When you create edition B with a validity from 11/2018, MDG-F will automatically set the validity for edition B on 12/2018.
Edition A is valid from 01/2019 to 12/9999.
- When you create edition B with a validity from 11/2020, MDG-F will automatically adjust the validity of edition A to 01/2019 to 10/2020.

Change requests within MDG-F always fall within one edition, regardless of whether the change is to be implemented immediately in the underlying business systems or at a later time. This is because it is possible to implement changes within an edition in underlying business systems without the edition having been released. In this way, small independent changes can be implemented without having to release the entire edition.

At the time a change request is created, it must be selected in which edition the change is to be included and thus in which period of time the changes are to become active. An edition that is valid today can be chosen to implement changes immediately or an edition that will only be valid later for scheduling future changes. As soon as an edition becomes active, i.e. the current date falls in the validity of the edition, all changes in the edition can be implemented to the underlying business systems. In all cases, of course, all validation checks and approvals have to be done.

In the diagram above, the changes are illustrated on two cost centers: cost center AVELON and cost center SAP. Looking at AVELON cost centre, we can draw the following conclusions:

In Q2 of 2020, version AVELON 1 was valid in released Edition 1.
As of Q3 2020, version AVELON 2 becomes active from the released Edition 2.
Also, for changes in Q3 2020, a new Edition 6 has been created, which is still being processed. Edition 6 includes changes in version AVELON 6 compared to version AVELON 2.
As of Q2 2021, version AVELON 4 becomes active from Edition 4. It is valid until Q3 2021.
As of Q3 2021, version AVELON5 becomes active from Edition 5. It is valid until Q4 9999.
On the marked date "Today", version AVELON 2 and AVELON 6 are active. Awning 2 is in an already released edition, but needs to be changed. A new edition has been created to include changes to GAVELON 2 to become GAVELON 6.
On the marked date "Future date", version AVELON 4 becomes active.

SAP Fiori

SAP MDG-F, like the other MDG domains, comes with a wide range of Fiori applications, which facilitates an intuitive and smooth user experience.

Requesting, for example, financial master data can easily be provided by means of a Fiori application, in which not all mandatory information has to be filled in yet.

Missing data can later be supplemented by a master data specialist in another Fiori application. Subsequently, the requested and completed master data can be approved in yet another Fiori application.

In addition to SAP Fiori applications for guiding the process for change requests regarding financial master data, SAP MDG-F also has so-called Fiori Analytics applications. By means of various Fiori reports, insight can be gained into the SAP MDG-F processes.

Demo

In the video below, a scenario is run through in which a new cost centre is requested. This takes place on an S/4HANA MDG 1909 system.

Conclusion MDG-F

MDG-F provides you with an application that optimizes your financial data and allows you to manage financial data within your company through streamlined processes.

In short, MDG-F facilitates the following:

Consistent financial master data throughout the organization;
Traceability changes for regulatory requirements;
Optimization of financial processes, internal audits, short turnaround times when periods are closed;
High quality financial master data. Data is reliable, where only one version of the truth exists;
Importing business data from external systems, such as investment management systems;
Through Fiori applications, MDG-F offers a user-friendly user interface for managing master data and handling change requests;
No duplicate data in the SAP system;
Time-dependent and period-based version of master data through editions.

For further questions or information on this subject or for other questions regarding SAP Workflow, Fiori or SAP Invoice Management (SIM), please contact Sander van der Wijngaart.

MDG-F or SAP MDG for Financials