What Is Subscription Financing and Accounting with SAP S/4HANA?

Global businesses are always looking for ways to stay relevant, and streamlining business operations has now become more understandable and mainstream. Financial operations are one area that are being streamlined these day.


Finance is a significant part of any business and it requires a lot of visibility. It encompasses accounting and controlling, cost determination, accurate analytics and financial reporting, identification of profit centers, and more.


High-volume, subscription-focused businesses are bound to unique financial limitations and transaction issues that can eventually lead to inconsistent revenue streams. They require a transparent finance system to clarify the various financial transactions and payments that occur, as well as stay on top of different tax laws.


A billing solution for subscription services should have the capability to control these complex processes without compromising profitability. SAP S/4HANA can help fulfill these needs



SAP S/4HANA helps transform business sectors to be more dynamic and relevant to market trends. It allocates effective finance processing capabilities that are insightful and, at the same time, transparent—all in real time.


SAP S/4HANA Finance helps eliminate all the barriers associated with legacy systems, including issues linked to planning, analytics, and transactions. In addition, the solution delivers accurate forecasts using real-time financial data that could help augment planning and decision-making based on the potential demands.


So how do SAP S/4HANA and SAP S/4HANA Finance help companies with subscription-based products? Let’s take a look at five key benefits.


1 Consolidated Invoicing and Billing

With a complete view of the contracts involved and proper allocation of consolidated invoices, SAP S/4HANA enables an accurate billing cycle for the subscription services provided. It also facilitates dispute resolution that helps resolve disruptions in the billing cycle.


2 Transparent Revenue Recognition

Solution order management is an effective way for subscription-based companies to profit; in these cases, companies sell bundled services instead of individual products. SAP S/4HANA allocates event-based revenue recognition for bundled or single offerings through personal sales and service documents.


3 Accounts Receivable and Payable

The automated system and single subledger for accounts receivable and accounts payable in SAP S/4HANA levels the accounting process under a unified approach. This helps enhance the traceability of payment, reconciliation, and closing at the end of a specific period.


4 Effective Financial Close

SAP S/4HANA Finance simplifies accounting and financing by combining all profitability data into a single source of truth. This helps users to get an effortless financial close followed by real-time data accessibility.


5 Control Costs and Profitability

Subscription-based businesses can also improve their profitability through proper analytics and integrated business planning by identifying profit and cost centers. SAP S/4HANA evaluates and generates potential reports quickly, which help assess the profit and margin contribution in real time.


How Is Subscription Financing with SAP S/4HANA Different from SAP BRIM?

SAP Billing and Revenue Innovation Management (SAP BRIM) is an end-to-end solution for subscription lifecycle management that delivers a flexible implementation of the entire quote-to-cash process, especially in the case of high-volume consumption scenarios. Financing in SAP BRIM facilitates intelligent services in order to automate payment handling and settling procedures.



Financing with SAP S/4HANA complements SAP BRIM in the payments and receivables settlement process flow. It allocates accurate management of financial transactions for transparent and insightful financial and accounting. In addition to these complementary features, SAP S/4HANA also has improved capabilities like integration with other finance and accounting solutions, profitability analysis, identification of cost and profit centers, predictive accounting, cost control, and cost management.


SAP S/4HANA serves as a financing platform with an integrative approach that could help elevate the entire finance and accounting process compared to the flexible approach brought by an end-to-end subscription solution. It allows organizations to foresee their cost structure and also upgrade the system architecture with additional solutions.



SAP S/4HANA brings an integrative approach of solutions compared to the end-to-end quote-to-cash cycle, and this benefits the entire subscription accounting lifecycle in a way that a single solution such as SAP BRIM can’t. Along with other SAP S/4HANA functionality and solutions like Solution Order Management and SAP Convergent Mediation by DigitalRoute, SAP S/4HANA can help elevate the finance and accounting process flow for subscription-based organizations.


To learn more about subscription billing with SAP S/4HANA and how to begin an implementation project, visit the Mobolutions website here.


SAP Billing and Revenue Innovation Management: Functionality and Configuration
SAP Billing and Revenue Innovation Management: Functionality and Configuration

Whether you're upgrading an existing billing system or moving to a subscription- or consumption-based model, SAP BRIM is ready—and so here's your guide! From subscription order management and charging to invoicing and contract accounting, get step-by-step instructions for each piece of the billing puzzle. For setup, operations, or analytics, follow a continuous case study through each billing process. With this book, join the future of billing!

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Meenakshy S Nair
by Meenakshy S Nair

Meenakshy S Nair is an experienced writer with extensive knowledge on SAP subscription services and SAP S/4HANA Finance, working at Mobolutions to deliver quality technical content.