What is hierarchical elimination in SAP FIN-CS - S4HANA Financial Consolidation?

SAP Term: hierarchical elimination

• Component: FIN-CS

• Component Name: S4HANA Financial Consolidation

• Description: An option to show specific organizational dimensions, such as profit center, segment, or consolidation unit with the eliminations at the different hierarchy levels. Hierarchical elimination requires both, a unit field and a partner field. For example: Unit - partner unit or segment - partner segment. Hierarchical eliminations are displayed based on a specific elimination member, which is included in the same hierarchy node as the unit and the partner fields.

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• Key Concepts: 
  Hierarchical elimination is a feature of SAP S4HANA Financial Consolidation that allows users to eliminate the effects of intercompany transactions between entities in a consolidation group. This eliminates the need to manually adjust the financial statements of each entity in the group. 
  
  How to use it: 
  To use hierarchical elimination, users must first define the consolidation group and assign each entity to it. Then, they must define the intercompany relationships between entities in the group. Finally, they can enable hierarchical elimination for the consolidation group and run the consolidation process. 
  
  Tips & Tricks: 
  When setting up hierarchical elimination, it is important to ensure that all intercompany relationships are correctly defined. This will ensure that all intercompany transactions are eliminated accurately. 
  
  Related Information: 
  For more information on hierarchical elimination, please refer to SAP's documentation on S4HANA Financial Consolidation.