Luke Carlson started his career in financial services before moving into SAP Treasury consulting. Specializing for the past 18 years in SAP Treasury and Risk Management, he has delivered SAP treasury projects to more than 25 companies across the globe. He is a thought leader in the SAP treasury space and regularly speaks at the SAP Financials and SAP Treasury conferences. He has worked with SAP to design and provide insight on many of the treasury and cash management additions and changes in SAP S/4HANA. In 2017, Luke co-founded Carlson Cash alongside a team of SAP treasury experts. Their initiative stemmed from identifying a market need: a company exclusively dedicated to ensuring the seamless implementation of SAP Treasury and Risk Management projects.

... Preface ... 19

... Objective of the Book ... 19

... Content and Structure of the Book ... 20

... Acknowledgements ... 23

1 ... Introduction to Treasury and Risk Management with SAP ... 25

1.1 ... Changes in Technology and the Evolving Corporate Treasury Function ... 26

1.2 ... Treasury and Risk Management with SAP ... 27

1.3 ... SAP Fiori User Experience ... 32

1.4 ... Supported Treasury Contracts ... 46

1.5 ... Summary ... 51

2 ... Master Data ... 53

2.1 ... Company Code ... 54

2.2 ... Bank Master ... 55

2.3 ... House Bank ... 57

2.4 ... House Bank Account/Account ID ... 59

2.5 ... Business Partners ... 60

2.6 ... Derivative Contract Specification ... 74

2.7 ... Calendars ... 84

2.8 ... Traders ... 86

2.9 ... Market Data ... 89

2.10 ... Market Data Interfaces ... 99

2.11 ... Summary ... 102

3 ... Core Configuration Elements ... 103

3.1 ... Company Code Additional Data ... 104

3.2 ... Accounting Codes ... 106

3.3 ... Valuation Areas ... 107

3.4 ... Valuation Class ... 108

3.5 ... General Valuation Class ... 109

3.6 ... Position Management Procedure ... 113

3.7 ... User Data ... 131

3.8 ... Product Categories ... 134

3.9 ... Product Types ... 141

3.10 ... Number Ranges ... 145

3.11 ... Transaction Types ... 146

3.12 ... Field Selection ... 148

3.13 ... Flow Types ... 151

3.14 ... Update Types ... 156

3.15 ... Condition Types ... 161

3.16 ... Accruals and Deferrals ... 165

3.17 ... Portfolios ... 170

3.18 ... Administration Fields ... 171

3.19 ... Workflow ... 172

3.20 ... Account Symbols ... 176

3.21 ... Posting Specifications ... 178

3.22 ... Account Assignment Reference ... 184

3.23 ... Position Transfers ... 194

3.24 ... Summary ... 199

4 ... Contract-Specific Configuration ... 201

4.1 ... Debt and Investments ... 201

4.2 ... Foreign Exchange ... 256

4.3 ... Securities ... 275

4.4 ... Derivatives ... 293

4.5 ... Commodity Derivatives ... 305

4.6 ... Summary ... 319

5 ... General Contract Processes ... 321

5.1 ... Create Financial Transaction App ... 321

5.2 ... Contract Settlement ... 342

5.3 ... Transaction Posting ... 344

5.4 ... Payment Processing ... 364

5.5 ... Summary ... 368

6 ... Treasury Management?Specific Processes ... 369

6.1 ... Debt and Investments ... 369

6.2 ... Facilities ... 390

6.3 ... Intercompany Loans ... 402

6.4 ... Securities ... 415

6.5 ... Foreign Exchange ... 438

6.6 ... Interest Rate Swaps ... 459

6.7 ... Trade Finance ... 468

6.8 ... Commodity Contracts ... 476

6.9 ... Summary ... 484

7 ... Exposure Management ... 485

7.1 ... Raw Exposures ... 486

7.2 ... Raw Exposures Apps ... 491

7.3 ... Releasing Raw Exposures ... 495

7.4 ... Exposure Configuration ... 497

7.5 ... Summary ... 514

8 ... Cash Flow Hedging ... 515

8.1 ... Hedge Management Configuration ... 517

8.2 ... Hedge Accounting for Positions Configuration ... 523

8.3 ... Hedging Area ... 541

8.4 ... Cash Flow Hedging Process ... 558

8.5 ... Period End Closing ... 591

8.6 ... Contract Close ... 594

8.7 ... Summary ... 597

9 ... Balance Sheet Hedging ... 599

9.1 ... Reviewing Balance Sheet Risk ... 600

9.2 ... Taking a Foreign Exchange Snapshot for Balance Sheet Risk ... 602

9.3 ... Balance Sheet Risk Overview Reporting ... 608

9.4 ... Processing Hedge Requests ... 609

9.5 ... SAP Trading Platform Integration ... 613

9.6 ... Master Data Setup ... 636

9.7 ... Summary ... 645

10 ... Correspondence ... 647

10.1 ... Configuration ... 648

10.2 ... Inbound and Outbound Process Settings ... 663

10.3 ... Additional Correspondence Settings ... 667

10.4 ... Correspondence Mapping Rules ... 671

10.5 ... Outbound Messaging ... 683

10.6 ... Inbound Messaging ... 687

10.7 ... Correspondence Matching ... 690

10.8 ... Display Correspondence ... 693

10.9 ... Alerts ... 699

10.10 ... Summary ... 703

11 ... SAP Treasury Analyzers ... 705

11.1 ... Credit Risk Analyzer ... 705

11.2 ... Market Risk Analyzer ... 724

11.3 ... Summary ... 741

12 ... Integration with Other Areas ... 743

12.1 ... Cash Management ... 744

12.2 ... Accounting ... 752

12.3 ... Payments ... 753

12.4 ... In-House Cash and In-House Banking ... 759

12.5 ... Summary ... 761

13 ... Reports, Key Performance Indicators, and Alerts ... 763

13.1 ... Standard SAP Fiori Reports ... 763

13.2 ... SAP Fiori Analysis Reports ... 782

13.3 ... SAP GUI Reports ... 794

13.4 ... Summary ... 803

... Conclusion ... 805

... The Evolution and Importance of Treasury and Risk Management ... 805

... Addressing Common Scenarios and Challenges ... 805

... Practical Applications and the User Experience ... 806

... Integration ... 806

... Looking Ahead ... 807

... Final Thoughts ... 807

... The Authors ... 809

... Index ... 811