Central Finance, Simple Finance or S/4HANA Finance?

SAP Central Finance, SAP Simple Finance or SAP S/4HANA Finance - the variety of terms can be confusing. We will shed light on this and tell you how the solutions differ.

Anyone interested in SAP's solutions for finance will sooner or later stumble upon the terms SAP Simple Finance, SAP S/4HANA Finance, and SAP Central Finance. Due to the similar terminology, the solutions are often confused.

A brief overview of the main differences

  • SAP Simple Finance is the predecessor product of SAP S/4HANA Finance. SAP Simple Finance was replaced at the end of 2015.
  • SAP S/4HANA Finance is the current ERP financial software from SAP and part of SAP S/4HANA. The ERP solution runs on the SAP HANA in-memory database.
  • SAP Central Finance is a platform based on SAP S/4HANA. It enables a centralized financial system. This solution can be used as an initial entry point for a later full implementation of SAP S/4HANA.

What is SAP Simple Finance?

With the introduction of the HANA database 2011, SAP laid the foundation for the SAP S/4HANA Business Suite. In 2014, the company announced SAP Simple Finance - the first business application developed by SAP for finance functions on the HANA platform.

SAP Simple Finance was also made available as an add-on via the EHP 7 enhancement package for SAP ERP 6.0. The solution was based on a simplified architecture, delivered new solutions for finance and accounting and provided a modern user experience.

Above all, the application technically combined financial accounting with controlling for the first time - the basis for shorter processing times and faster analyses.

SAP changed the product name at the end of 2015: SAP Simple Finance became SAP S/4HANA Finance.

What is SAP S/4HANA Finance?

SAP S/4HANA Finance is part of the SAP S/4HANA Business Suite. The current version is SAP S4 HANA Finance 1909.

With the ERP financial software, SAP provides companies with a comprehensive solution for the entire financial management - from financial planning and analysis, accounting, risk and compliance management to receivables management.

SAP S/4HANA Finance is available on-premise or for the cloud. The solution provides companies with a uniform view of all financial and operational data. It ensures optimized business processes and enables real-time analysis.

What is SAP Central Finance?

SAP Central Finance is a platform based on SAP S/4HANA. It enables a centralized financial system. Data from heterogeneous SAP and non-SAP ERP systems with different data structures can be transferred to this system and harmonized. This does not involve any intervention in the operative systems.

It is not necessary to convert the ERP landscape used. The existing systems and system landscapes remain unchanged. They will only be connected to the SAP central finance system. This creates a "single-point-of-truth" with which current figures can be provided across different group companies.

SAP Central Finance also gives companies the opportunity to benefit from the key advantages of SAP S/4HANA - but without having to switch directly to SAP S/4HANA in its entirety. SAP Central Finance is also referred to as the "ideal door opener" for SAP S/4HANA.

The silver bullet - SAP Central Finance as a preliminary project to SAP S/4HANA

According to the motto "Finance first", SAP Central Finance can pave the way to SAP S/4HANA. SAP writes: "For internationally active companies with very heterogeneous landscapes, Central Finance is today considered the ideal way to SAP S/4HANA.

If companies decide to use SAP Central Finance, SAP Central Finance first consolidates all existing systems. The complete migration to SAP S/4HANA will follow at a later date. This procedure considerably reduces the complexity and risks of a migration to SAP S/4HANA.