AC040 Cost Management and Controlling
Cost Management and Controlling SAP AG 2001 SAP AG
R/3
System
Release
46C
August
2001
Collection
13
Material number
5004 4346
Copyright
Copyright 2001 SAP AG. All rights reserved. No part of this publication may be reproduced or transmitted in any form or for any purpose without the express permission of SAP AG. The information contained herein may be changed without prior notice. All rights reserved.
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Trademarks: Some
software products marketed by SAP AG and its distributors contain proprietary software components of other software vendors.
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SAP,
SAP Logo, R/2, RIVA, R/3, ABAP, SAP ArchiveLink, SAP Business Workflow, WebFlow, SAP EarlyWatch, BAPI, SAPPHIRE, Management Cockpit, mySAP.com Logo and mySAP.com are trademarks or registered trademarks of SAP AG in Germany and in several other countries all over the world. All other products mentioned are trademarks or registered trademarks of their respective companies.
Controlling Level 2
Level 3 AC412 2 days Cost Center Accounting: Extended Functionality AC410 Cost Center Accounting
3 days
AC415 AC420
AC040
2 days
Activity Based Costing
5 days
AC510 3 days Cost Object Controlling for Products
Cost Management and Controlling AC505
4 days
Product Cost Planning AC605
5 days
Profitability Analysis AC610 Profit Center Accounting
2 days
AC615 4.6B 2 days Executive Information System (EIS) 1 Reporting SAP AG 2001
2 days
Overhead Orders
AC515 3 days Cost Object Controlling for Sales Orders AC530 3 days Actual Costing / Material Ledger AC650
2 days
Transfer Prices AC620 4.6B 2 days Executive Information System (EIS) - Setting up the System
AC625 4.6B 1 day Executive Information System (EIS) 3 Business Planning
Prerequisites:
z Recommended: z SAP20 - SAP R/3 Overview z Basic knowledge and experience in Cost and Managerail Accounting z Working knowledge of the Windows operating environment
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Target Group
z Implementation project managers, project team leaders and team members who have the appropriate background in Controlling z Management and support personnel who want to know what the R/3 Controlling component can do
SAP AG 2001
Notes to the user The training materials
are not teach-yourself programs. They complement the course instructor’s explanations. There is space for you to write down additional information on the sheets.
Introduction: Unit Contents
z Course Goals z Course Objectives z Course Contents z Course Overview Diagram z Main Business Scenario
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Course Goals This course: z Provides you with basic knowledge of the components of Controlling (CO) in R/3 z Explains the integration between CO and other R/3 components z Explains the various cost allocation methods in CO z Helps you decide which R/3 tools to use depending on the cost allocation options you select z Familiarizes you with SAP terminology z Describes further training requirements and prepares you for the corresponding training courses
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Course Objectives At the conclusion of this course, you will be able to: z Use the main CO functions
z Identify the components in CO that address different business requirements
z Explain how the CO components are integrated with each other z Explain how CO is integrated with other R/3 components z Understand SAP terminology
z Describe the different cost allocation methods and explain the differences between them z Decide which CO tools to use in given business situations SAP AG 2001
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Course Content Preface Unit 1
Introduction
Unit 7
Posting to CO from Other Modules
Unit 2
Navigation
Unit 3
Overview of Controlling
Unit 8
Transaction-Based Postings in CO
Unit 4
Representing Your Business in CO
Unit 9
Period-End Postings in CO
Unit 5
Reporting Tools
Unit 10
AcceleratedSAP
Unit 6
Planning and Integrated Planning
Unit 11
Summary
Exercises Solutions SAP AG 2001
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Course Overview
$ t Reporting Tools
+ABC Planning and Integrated Planning
HR
MM
FI
SD AA
DM DM
Posting to CO from Other Components
CO 1
9
12
$
Transaction-Based Postings in CO
OM PC Profit Representing Your Business in CO
CO
AC040
1 12 OM PC Profit FI CO
INT EXT OM PC Profit
Period-End Postings in CO
FI MM HR AA SD
Overview of Controlling
“Where now?" Navigation
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Summary
ASAP: Introduction
Getting Started
AC040
1-5
Main Business Scenario
z You work in your company’s cost accounting department. The company has recently implemented a number of the R/3 application components, including FI and CO. z You have been temporarily assigned to a special project having a dual purpose. First, as a form of quality review, you are being asked to analyze how effectively CO is meeting your company’s management accounting requirements. And, in conjunction with this, the newly engaged CPA audit firm is conducting an operational review to learn about your company’s business. You have been asked to serve as a liaison for their review. z This assignment will require your involvement in all aspects of CO. Since you have no experience with the R/3 CO component, your initial priority will be to learn about CO’s capabilities.
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Navigation
Contents: z Navigation in the system z User-specific settings z Navigation in the mySAP.com Workplace
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Navigation: Unit Objectives
At the conclusion of this unit, you will be able to: z Identify the elements of a typical window z Navigate in the system z Personalize your user settings z Describe and use the mySAP.com Workplace
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Navigation: Business Scenario
z New users need to familiarize themselves with the screens in the system and define their personal default settings
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Logging On to the System User System
Help
SAP R/3 New Password
If you have problems logging on, contact Donna Moore, x486
Client User Password
Language
You can place your own text on the initial screen: See SAP Note 205487
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SAP
R/3 Systems are client systems. The client concept enables the parallel operation, in one system, of several enterprises that are independent of each other in business terms. The components SAP Business Information Warehouse (BW) and SAP Knowledge Warehouse (KW) are exceptions to this: in these cases only one client is used. During each user session you can only access the data of the client selected during logon.
A
client is, in organizational terms, an independent unit in the system. Each client has its own data environment and therefore its own master data and transaction data, assigned user master records and charts of accounts, and specific Customizing parameters.
For
a user to log on to the system, a master record must exist in the system for that user. To protect access, a password is required for logon. The password is hidden as you type (you only see asterisks).
SAP
R/3 Systems are available in several languages. Use the Language input field to select the logon language for each session.
Multiple logons
are always logged in the system beginning with SAP R/3 4.6. This is for security as well as licensing reasons. A warning message appears if the same user attempts to log on twice or more. This message offers three options: y Continue with current logon and end any other logons of the same user in the system
y Continue with current logon without ending any other logons in the system (logged in system) y Terminate current logon attempt
You
can place your own text on the initial screen in a number of ways. For more information, see the SAP Note mentioned above. The GuiXT (covered at the end of this chapter) offers a further option.
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Screen Elements Command Field Menu Edit Favorites Extras System
Standard Toolbar
Help
System Function Name: Activity Choose
Save
Application Toolbar
Input field
Tick Selection 1 Selection 2 Selection 3 Selection 4
Checkboxes Radio Buttons Pushbuttons
Options Option 1 Option 2 Option 3
This screen is made up of various screen elements. It does not match an actual screen in the system. Overview
Option 4 Option 5
Positive Display
Edit
Neutral
Tab Page System Message
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Status Bar
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Command field:
You can use the command field to go to applications directly by entering the transaction code. You can find the transaction code either in the SAP Easy Access menu tree (see the page User-Specific Personalization) or in the appropriate application by choosing System→ Status.
Standard toolbar: The icons
in the standard toolbar are available on all SAP R/3 screens. Any icons that you cannot use on a particular screen are dimmed. If you leave the cursor on an icon for a moment, a QuickInfo appears with the name (or function) of that icon. You will also see the corresponding function key. The application toolbar shows you which functions are available in the current application.
Checkboxes: Radio
Checkboxes allow you to select several options simultaneously within a group.
buttons: Radio buttons allow you to select one option only.
Tabs: Tabs
provide a clearer overview of several information screens.
Status bar: The
status bar displays information on the current system status, for example, warnings or error messages. Other elements are: Menu bar: The menus shown here depend on which application you are working in. These menus contain cascading menu options.
Title bar: The title bar displays your current position and activity in the system.
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SAP Easy Access - Standard Menu Edit Favorites Extras System
Help
SAP Easy Access Other Menu
Create Role
Assign User
Documentation
Favorites SAP Menu Office Logistics Accounting Human Resources Information Systems Tools
You are greeted by your logo in the right-hand part of the window.
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SAP
Easy Access is the standard entry screen displayed after logon. You navigate through the system using a compact tree structure.
You
can include an image on the right-hand side of the screen such as your company logo. This image can only be entered systemwide, and is a cross-client setting. Assuming you have the appropriate authorization, you can find a detailed description of the necessary settings by choosing Extras → Administration Information. Note that this image is stored in the system and transported to the SAP Frontend every time it is called by SAP Easy Access. Although this transfer is compressed, the image for the initial screen should not be bigger than around 20 kB. You can prevent this image being called either by using the setting Low Speed Connection in the SAPLogon program (see SAP Note 161053), or by switching off the calling of the image under Extras→Settings. See also UserSpecific Personalization.
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Selecting Functions ... using the transaction code in the command field Menu
Edit
Favorites
Extras
SAP Easy Access - Enjoy User Favorites Enjoy User Menu URL - SAP Notes (User / PW req.) Accounts Receivable FD02 -Change Customer (Account Materials Management Sales and Distribution Tools
System
Help
Create session End session User profile Menu Services Utilities List Services for object Object history Own spool requests Own Jobs Short Message Status... Log off
... using the menu path ... using SAP Easy Access and Favorites SAP AG 2001
You
can select system functions in the following ways:
y Use the mouse to choose: Menu options, Favorites, and SAP Easy Access options y Use the keyboard (ALT + the underlined letter of the relevant menu option) y Enter a transaction code in the command field: A transaction code is assigned to each function in SAP R/3 Systems. You can access the assigned transaction code from any screen in the system. For example, to display customer master data, enter /n and the appropriate transaction code (in this case /nfd03). You can find the transaction code for the function you are working in under the Status option of the System menu. Other possible entries: - /n ends the current transaction. - /i ends the current session. - /osm04 creates a new session and goes to the transaction specified (SM04). You
can also use the keyboard to go to the command field. Use the CTRL + TAB key combination to move the cursor from one (input) field group to the next. Use TAB to move between fields within a group.
By entering search_sap_menu
in the command field, you can search for and display the menu path for an SAP transaction. You can also search for text strings.
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Role-Based User Menu Menu Edit Favorites Extras System
Help
SAP Easy Access - Enjoy User Menu Other Menu
Create Role
Favorites Great Transactions SM50 - Prcoess Overview VA01 - Create Sales Order Interesting WWW Pages URL - The Herald Tribune URL - Time Magazine Important Files URL - Vacation Planning Enjoy User Menu URL - SAP Notes (User / PW req.) Accounts Receivable FD02 - Change Customer (Accountin Materials Management Sales and Dsitribution Tools
Assign User
Documentation
Favorites chosen by the user reduce navigation time
A role-based menu contains the activities that the user can execute based on the role assigned to the user in the system. T70 (1) (400)
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A
Role describes a set of logically linked transactions in the system. These represent the range of functions users typically need for their work.
User
roles (previously “activity groups”) have to be set up using the Profile Generator so that SAP R/3 System users can work with user-specific or position-related menus.
The authorizations for the activities
listed in the menus are also assigned to the users using user roles. With Release 4.6, predefined user roles from all application areas are included in the standard system.
Users
menu.
who have been assigned a user role can choose between the user menu and the SAP standard
The above
screen shows the role-based user menu for a user with the name "Enjoy". You can find roles that are supplied in the standard SAP R/3 System by choosing Other menu on the SAP Easy Access initial screen.
Every enduser
can personalize the initial screen using Favorites. You can create your own Favorites list containing the transactions, reports, files, and Web addresses that you use most often.
You
can add favorites either by choosing Favorites or by using the mouse to “drag & drop” items into the Favorites directory.
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Field Help: F1 and F4 Customer
Edit Goto Extras Environment System
Help
Display Customer: Customer: Initial Screen
F1 Help: Displays the Meaning of Fields and Technical Information
Customer
Customer account number
Company Code
A unique key is used to clearly identify the customer within the SAP System. Procedure When creating a customer master record, the user either enters the account number of the customer or has the system determine the number when the record is saved, depending on the type of number assignment used. The account group determines how numbers are
Restrictions
assigned. Customer
1000
Entries Found
Company Code Company Name City Currency
Restrictions
F4 Help: Displays Possible Entries Co...
Restrict Number to
Company Name City
Cur...
SAP A.G.
Walldorf EUR
IDES AG 1000 IDES Canada
Frankfurt UNI Toronto CAD
IDES AG
Frankfurt UNI
SAP AG 2001
For
help on fields, menus, functions, and messages, use F1.
F1
help also provides technical information on the relevant field. This includes, for example, the parameter ID, which you can use to assign values for your user to input fields , which have to refer to these parameter IDs.
For
information on what values you can enter, use F4. You can also access F4 help for a selected field using the button immediately to the right of that field.
If
input fields are marked with a small icon with a checkmark, then you can only continue in that application by entering a permitted value. You can mark many fields in an application as either required entry fields or optional entry fields. You can also hide fields and preassign values using transaction or screen variants or Customizing.
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SAP Library SAP Library - SAP Library
Contents
Index
Search
SAPLibrary
SAP Library
Release 4.6C, March 2000
IDES Getting Started
You can access the complete online documentation for the system using the SAP Library
Release Notes Implementation Guide Glossary Copyright 2000 SAP AG All rights reserved.
SAP AG 2001
SAP
R/3 Systems provide comprehensive online help. You can display the help from any screen in the system. You can always request help using the Help menu or using the relevant icon (the yellow question mark).
You
can access the SAP Library quickly and comfortably by using the SAP Service Marketplace. There you can find the SAP Help Portal under Knowledge and Training, where you can not only access Help in HTML format, but can also perform efficient full-text searches in the SAP Library. If you have the SAP Library installed, you also have, of course, these opportunities within your company.
You
can access the Help Portal directly at http://help.sap.com
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Menus: System and Help Menu
Edit
Favorites
SAP Easy Access Other Menu
Favorites SAP Menu Office Logistics Accounting Personnel Information Systems Tools
Extras
System
Help
Create Session End Session User profile Rolle anlegen Services
Application help SAP Library Glossary Benutzer zuordnen Notes Release
Utilities List Services for object Object history Own spool requests Own jobs
SAPNet Feedback Settings...
Documentation
Short message Status... Log off
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The System
menu contains, among others, the following options:
y Create/End Session: Allows you to create and end sessions. The maximum number of sessions can be set to a number between 2 and 6 by the system administrator using the parameter rdisp/max_alt_modes. y User profile: This is where you can enter user-specific settings. For example, you can use Parameter IDs in Own Data, in order to set default values for specific user-dependent fields in the system (for example the company code field). y List: Contains important list functions, such as searching for character strings, saving in PC files, printing, and so on. y Status: Enables you to display important user and system data. y Log off: Ends the R/3 session with a confirmation prompt. The Help
menu contains, among others, the following options:
y Context-sensitive Application Help y Access to the SAP Library (see previous page) y a Glossary y ...
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User-Specific Personalization Menu
Edit
Favorites
SAP Easy Access Other Menu
Favorites SAP Menu Office Logistics Accounting Human Resources Information Systems Tools
Exrtas
System
Help
Administration Information Ctrl+Shift+ F8 Assign user Options ... Display Documentation Shift+ F6 Generate Graphic Rolle anlegen Benutzer zuordnen Dokumentation Ctrl+Shift+ F10 Technical Details Create Shortcut ... Shift+ F9 Settings Activate GuiXT Set Start Transaction Shift+ F7 Default Size Hardcopy Quick Cut and Paste About...
Settings This is used to specify settings Display favorites at end of list Do not display menu, only display favorites Do not display picture Display technical names
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The end
user has many possibilities for personalizing the system. Some are described below:
y You can alter the layout of your initial screen under Extras → Settings, for example by switching off the image in the right-hand part of the window or by turning on the option to display the technical names (transaction codes) in the SAP Easy Access Menu. y Among other things, you can activate a quick cut and paste in the Options menu. Using Options you can change the reaction speed of the QuickInfo that is displayed when you hold your mouse cursor over an icon or a push button. y By following the path System→ User profile→ Own data, you can set personal standard values. You can choose the tabs Address, Defaults, and Parameters. As an example, the setting of Parameters is explained here: - Parameters: Here you can set defaults for frequently used input fields. In order to be able set a default value for a field, it must have been assigned a Parameter ID. Procedure for finding the Parameter ID: Go to the field for which you wish to set a default value. Select the F1 help, and then choose Technical Info. The system displays an information window that contains the relevant parameter ID under the heading Field Data (as long as the field has been assigned a Parameter ID).
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Table Settings - Example
Parameters
Value
Text Sales order type Company code Processing group Bank key
Table Settings Choose Variants Current setting
My variant
Standard setting
Basic setting
Maintain Variants Variant Use as standard setting Create Delete
Save
Administrator
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Use
the Table Settings function to change, in the table control, the individual basic table settings that are supplied with the system. This is particularly useful for tables where you do not need all the columns. You can use the mouse to drag & drop column positions and widths, or even make the column disappear.
Save
the changed table settings as a variant. The number of different variants you can create per table is not restricted.
The first
variant is called the basic setting; the SAP System defines this setting. You cannot delete the basic setting (you can delete the variants you define yourself).
The table settings
are stored with your user name. The system uses the variant currently valid until you exit the relevant application. If you then select the application again, the system will use the standard settings valid for this table.
Note:
you can change table settings wherever you see the table control icon in the top right-hand corner of a table.
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Personalizing the Frontend with GuiXT
FD03 without GuiXT
FD03 with GuiXT
Example from http://www.guixt.com SAP AG 2001
SAP
R/3 Systems offer numerous options for settings and adjustments:
y Define default values for input fields y Hide screen elements y Deactivate screen elements (dimmed) You can do this by, for example, defining transaction variants. SAP
now:
offers GuiXT, as of SAP R/3 Release 4.6. In addition to all of the above functions, you can
y Include graphics y Convert fields and add pushbuttons and text y Change input fields (or their F4 help results) into radio buttons GuiXT
scripts are stored on the Frontend. In accordance with local scripts (which can also be stored centrally), the GUIXT scripts determine how data sent from the application server is displayed. These scripts can be standard throughout a company, or they can be different for each Frontend.
NOTE: The
GuiXT will support the mySAP.com Workplace only as of the end of the year 2000. This means that until then you should use either the SAP GUI for the Windows Environment and the GuiXT or the mySAP.com Workplace with the SAP GUI for HTML (or the SAP GUI for Java or the SAP GUI for Windows).
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Navigation: Unit Summary
You are now able to: z Identify the elements of a typical window z Navigate in the system z Make personal system settings z Describe and use the mySAP.com Workplace
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Exercises Unit: Navigation Topic: Basic Functions At the conclusion of this exercise, you will be able to: •
Log on to an SAP R/3 System
•
Find transaction codes
•
Access the SAP Library
•
Use F1 help to find field information
•
Use F4 help to search for possible field entries
As a new user of an SAP R/3 System, you begin to navigate the system using the menu paths and transaction codes. You also begin to access the various types of online help.
All menu paths in the exercises refer to the SAP standard menu. 1-1
Logging on to the system Select the appropriate system for this course. Use the client, user name, initial password and logon language specified by the instructor. The first time you log on, you will get a prompt in which you must enter your new password, which you choose yourself, twice. Make a note of the following: Client: _ _ _ User: _ _ _ _ _ _ Password: ____________ Language: _ _.
1-2
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What is the maximum number of sessions (windows in the SAP R/3 System) you can have open simultaneously? __
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1-3
Identify the functions and find the transaction codes that correspond to the following menu paths in the SAP standard menu. 1-3-1 Toolso Administration o Monitor o System Monitoringo User Overview Name of function: ___________________________________________ Transaction: _________________________________________________ 1-3-2 Accounting o Financial Accounting o Accounts Receivableo Master Recordso Display Enter Customer 1000 and Company Code 1000 to go to the next screen.
Name of function: _____________________________________ Transaction: ___________________________________________
1-4
Help 1-4-1 If you choose Application help in the SAP Easy Access initial screen (System menu), which area of the SAP Library does it take you to? _________________________________________________________
To answer the questions below, you will need to go to the Display Customer: Initial Screen. 1-4-2 Use F1 help on the Customer field. What is this field used for? Write a brief summary of the business-related information. ______________________________________________________
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1-4-3 Use the F1 help on the Company code field. If you choose the Application help icon from the F1 help screen, which area of the SAP Library does it take you to? ______________________________________________________ 1-4-4 Which icon do you need to use on the F1 help screen to find the parameter ID for the Company code field? Hint: See the notes on the slide User-Specific Personalization
______________________________________________________ 1-4-5 Use F4 help on the Customer field to find the customer number for Becker ##. To do this, use the Search term "Becker*" after calling the F4 help. Note: ## corresponds to your assigned group number. ___________________________________________________
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Unit: Navigation Topic: User-Specific Settings At the conclusion of this exercise, you will be able to: •
Set a user parameter for a field
•
Set user defaults
•
Maintain your favorites
•
Select a start transaction of your choice
You begin to set various user-specific settings.
Exercises marked * are optional. 2-1
Setting user parameters. 2-1-1 Assign a parameter value for the Company code field to your user profile. Note: The instructor will tell you what parameter value to enter (for example For information about defaults, see the notes on the slide UserSpecific Personalization. 1000).
Parameter ID: ___ ___ ___ Parameter value: ___ ___ ___ ___
2-2
Defining User-Specific Settings using System → User profile → Own Data 2-2-1 In your user profile, set your logon language to the value used for the course. 2-2-2 In your user profile, set the decimal notation and date format of your choice.
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2-3
Defining your favorites 2-3-1 Insert at least one new folder under the Favorites folder. 2-3-2 Add any two of your favorite transactions to the corresponding folders. 2-3-3 Add the Internet address http://www.sap.com with the text SAP Homepage.
2-4*
Setting a start transaction using the Extras menu. 2-4-1 Enter a transaction of your choice as the initial transaction. You will then need to log off and on again for the change to take effect. Note: If desired, you can change the initial transaction back to the default value simply by deleting the transaction code that you entered.
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Solutions Unit: Navigation Topic: Basic Functions 1-1
Log on to the system specified by the instructor and change your initial password.
1-2
To open and close sessions, choose System o Create session (or use the appropriate icon) or System o End session. The maximum number of sessions you can have open simultaneously is six (6), depending on your system settings.
1-3
To find the transaction code, choose System o Status. These function names and transaction codes correspond to the menu paths: 1-3-1 Transaction: SM04 for Function Name: User list 1-3-2 Transaction: FD03 for Function Name: Display Customer: General Data
1-4
Help 1-4-1 The section of the unit Getting Started that deals with using SAP Easy Access is displayed. 1-4-2 Suggestion: The customer is a unique key (account number) used to clearly identify the customer within the system. 1-4-3 FI – Accounts Receivable and Accounts Payable 1-4-4 To find the Parameter ID: BUK, choose Technical Info 1-4-5 Customer ## (## corresponds to your assigned group number) When you select F4 in the Customer field, the Restrict Value Range window appears. You can explore the various tabs to see the different search criteria available. Find a tab that includes the Search term field and enter the following: Field Name
Value
Search term
Becker*
Choose Enter. A window appears listing the customer account numbers that match your search criteria. Select the line that corresponds to Becker ##, then choose Copy. This automatically copies the customer account number into the Customer field.
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Unit: Navigation Topic: User-Specific Settings
2-1
Setting user parameters. 2-1-1 To assign a parameter value to a field you will need the parameter ID of the field. First you need to select a transaction that contains this field. For example, Company code can be found in transaction FD03. Next, place the cursor on that field (click it with the mouse). To display the required info, choose: F1 o Technical Info o Parameter ID gives you the required information. For the Company code field, the parameter ID is BUK. Finally, enter the parameter ID and desired value in your user profile: System o User profile o Own data On the Parameter tab page you enter the parameter ID and value that you want to be entered into the field. Save your entries.
2-2
Setting user defaults. 2-2-1 To set the logon language, go to your user profile: System o User profile o Own data On the Defaults tab page, enter the language of your choice in the Logon language field. 2-2-2 To set the decimal notation and date format, remain on the Defaults tab in your user profile. Select the indicator adjacent to the notation and format you desire. Save your selections.
2-3
Defining favorites of your choice. 2-3-1 Favorites o Insert folder Type any name for the folder then select Enter. You can add as many folders as you desire. Once created, folders can be dragged and dropped to position them where you want. 2-3-2 To create favorites, select specific applications (transactions) that you need as favorites for your daily work from the menu tree of the SAP standard menu. Add them to your Favorites list by selecting them and choosing Favorites → Add from the menu bar. Alternatively, use the mouse to drag & drop favorites to a folder. You can also use the menu path Favorites o Insert transaction to add using a transaction code.. Finally, you can move existing favorites to different folders later by choosing Favorites o Move or using drag & drop.
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2-3-3 Create Internet addresses by choosing Favorites o Add Web address or file. When you select SAP Homepage from your favorites, an Internet browser will open and you will be connected to SAP’s homepage. 2-4
Setting a start transaction. 2-4-1 Extras o Set start transaction Enter a transaction of your choice then choose Enter. Notice the system message on the status bar indicates that your selected transaction has been set as the start transaction. The next time you log on, the system will go directly to your start transaction. Note: To change back to SAP Easy Access as the initial screen, follow the menu path again, delete the transaction code and select Enter. The next time you log on, SAP Easy Access will be the initial screen.
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Overview Of Controlling: Contents
z General Tasks of Controlling z The Components of CO z Integration z Transfer Prices
SAP AG 2001
© SAP AG
AC040
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Overview Of Controlling: Unit Objectives At the conclusion of this unit, you will be able to: z Explain the differences between Internal and External Accounting. z Explain how CO helps manage a business and use some standard CO reports. z List the components of CO and explain their purpose. z Explain the basic integration points between the components of CO. z Explain the basic integration points between CO and other R/3 components. z Explain the transfer price concept in the SAP system
SAP AG 2001
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AC040
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Overview
$
+ ABC
t Reporting Tools
Planning and Integrated Planning
HR
MM
FI
SD AA
FI
MM
HR
AC040
Navigation
© SAP AG
12
$
Period-End Postings in CO
SD
Overview“Where of Controlling now?"
SAP AG 2001
9
1 12 OM PC Profit FI CO
Profit AA
CO 1
Transaction-Based Postings in CO
Representing Your Business INT in CO EXT
PC
DM DM
Postings to CO From Other Modules
OM PC Profit
OM
CO
AC040 AC040
Summary
ASAP: Introduction
Introduction
AC040
3-3
Overview Of Controlling:Business Scenario
z Your initial focus is to gain an understanding of the purpose of CO, and how FI and CO work together to provide both financial and management information. z You learn that CO has several different major components, each having a particular purpose. You also learn that these different components are integrated with each other, as well as with other R/3 components.
z In order to get some exposure to the output of CO, you volunteer to assist in running and analyzing some reports for the subsidiary of your company. These reports mainly concern the business results of the subsidiary. They illustrate the integration between the General Ledger (FI),), Cost Center Accounting (CO), and Profitability Analysis (CO) components.
SAP AG 2001
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AC040
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General Tasks of Controlling
At the conclusion of this topic, you will be able to: z Explain the differences between Internal and External Accounting within the R/3 System.
z Explain some of the ways in which Controlling can help to manage a business. z Use some standard CO reports to perform a typical business analysis.
SAP AG 2001
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AC040
3-5
Accounting Architecture EC
Enterprise Controlling Profit Centers EIS
ConsoliConsoli- Enterprise Planning dation
TR
FI
CO
TREASURY
Financial Accounting
CONTROLLING
zCash zTreasury zFunds
zGeneral Ledger zPayables/ Receivables zAssets FI IM
zCost Controlling zRevenue Controlling
Investments and Financing
SAP AG 2001
The general
expression "Accounting" is used to describe a variety of different functions and business processes. The R/3 system architecture comprises specialized accounting components which serve these various functions.
The “Treasury”
(TR) component concentrates on functions such as cash, treasury management (for instance funds, foreign exchange, derivatives and securities), loans and market risk management.
The component “Financial Accounting"
(FI) chiefly involves the general ledger (G/L), processing receivables and payables and asset accounting.
The component "Investment
Management" (IM) supports planning, investment and finance processes for capital investment measures.
The component “Controlling”
(CO) offers a variety of tools that can be used in preparing operational information for business analysis and decision-making by management. The main emphasis of this course is on the Controlling component. The most important CO components (cost and revenue controlling) are treated in great detail in this course.
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AC040
3-6
FI and CO: Standard versus Flexibility ECPCA
FI
Internal accounting Cost accounting Various valuations Flexibility
Controlling
Financial Accounting
IA GA S GO A B P
Tax audit
Profit Center Accounting
CO
Ext. accounting Financial statements Legal requirements Standards
SAP AG 2001
The R/3
application component Controlling (CO) contains all the functions necessary for effective cost and revenue controlling. CO covers all aspects of management Controlling.. It offers a broad spectrum of tools which can be used to compile information for the company management which greatly exceeds that required by law.
Financial
reports used for external reporting purposes (such as balance sheets and profit and loss calculations) are created in FI. These external reporting requirements are, like the varying legal requirements set by the relevant financial authorities, usually prescribed through general accounting standards such as GAAP or IAS.
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AC040
3-7
Reporting Requirements
External reporting
External Accounting
Balance Sheet
Cash flow statement Profit & loss (P&L)
Internal reporting Internal Accounting
Product cost reports
Retained earnings
Cost center reports Profit Center reports
Contribution margins
SAP AG 2001
While there
are often different accounting information requirements for internal and external users, much of the underlying data may be relevant for both purposes. But that same data can be presented in very different ways to satisfy the differing requirements.
Standardized
accounting intended for external users is sometimes termed "financial accounting". The term "managerial accounting" generally refers to the non-standardized accounting approach that supports the management decision-making process.
Financial
accounting reports typically required include the income statement (or profit & loss statement), and balance sheet. Managerial accounting reports can be structured individually, a common example being the plan/actual cost comparison for the current period directed to the department.
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AC040
3-8
Controlling Architecture COPA
Overhead Cost Controlling
Cost Center
CO-PC
Overhead Cost Controlling Material Valuation
Process Internal Order
Production MaterialLabor OH Process Order
Cost Element Accounting
FI
Financial Accounting
HR Human Resources
WIP
Asset
Procure
Product
Stock
Warehouse
ECPCA
Profit Center Accounting
CO OM
Profitability segment
Profitability Analysis
Revenue
Sales
SAP AG 2001
This
graphic illustrates the essential features of the CO architecture. The black arrows between the different CO components display the typical cost and activity quantity flows (such as working hours) which occur between these components. The arrow between CO-OM and CO-PC shows, for example, that costs can flow from overhead controlling to product cost controlling. Later on in the course it will be shown that these costs can be transferred to a production order in the form of an overhead allocation. Likewise they can be charged as overhead to the same production order as working hours, meaning the labor costs could be calculated by multiplying the number of hours with a standard hourly rate
Similarly,
costs from Overhead Controlling (OM) and Product Cost Controlling (PC) can flow into Profitability Analysis, where together with revenue data they can be used to calculate operating results making it possible to establish how profitable the various area are.
You
will also later see that other R/3 applications can post costs or revenues to CO. The arrows between FI and CO illustrate the relationship between Financial Accounting (FI) and CO. Hence, for example, postings to expense account in FI can cause cost postings in the OM component in CO. In the same way FI can post revenues directly in component PA. Cost flows also occur between FI and the component PC, which is where raw material costs incurred in the production process are entered In addition, there is a flow back into FI if production costs have been activated as an end product or WIP (work in process).
Other
R/3 components such as Human Resources (HR), and Logistics (materials management, sales and production planning) are integrated with CO, as can be seen in the logistics process flow (procurement, production, warehouse and sales) in the above graphic.
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AC040
3-9
Important Controlling Areas
Typical Controlling Activities
Cost allocation according to source of costs
Overhead Cost Controlling Planning Price Calculation Distribution Assessment Activity allocation - fixed - variable
Cost Object controlling Preliminary Costing Simultaneous Costing Final Costing Calculation of Actual Costs of Goods Manufactured
Profitability Analysis Sales Planning Drill- downReporting Profit Centers Analysis Transfer Prices
SAP AG 2001
This
graphic contains several functions which are typically executed in the three most important CO areas. These functions will be described in detail in a later part of the course. For now, the main focus is on the basic concept of the flow of costs.
The main
emphasis in Overhead Cost Controlling (CO-OM) concerns those costs which cannot be traced directly to the goods and services of a company, but which need to be included and settled as far as is possible according to their origin. Account assignment objects for such costs include cost centers and internal orders, for example. This means that within the planning process it is possible to plan not just costs but also internal activities which can then be used to calculate prices for the activity types. If, in the course of the year, activities are supplied from the cost centers to other cost centers or even to the shop floor area of the company, the activities - with the prices valuated - flow to the corresponding receivers (consumers). At the end of the period the overhead cost object balances are calculated and then allocated to Product Cost Controlling or profitability and sales accounting
Product
Cost Controlling includes the costs for the production of goods and services (and in certain cases also their sales revenues) and settles these finally to financial accounting or to profitability and sales accounting.
Profitability and
sales accounting is used for enterprise planning. However, its main focus is the determination of the business profit and loss in actual. To do this two views are always used: first the ’external view in the market’ for the analysis of profitability segments (Profitability Analysis) and secondly the ’internal view’ of individual parts of the company responsible for profit (Profit Center Accounting)
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AC040
3-10
Typical Controlling Area Tasks
Cost Element z Which expenses are also costs? Accounting
Overhead Cost Controlling
z How can we reduce our overhead costs?
and
Are the areas of responsiblity effective?
ABC
How can we optimize our internal business processes?
Product Cost Controlling
Profitability Analysis
Profit Center Accounting
z How high are the costs - of a product? - of a manufacturing order? - of a project?
z
How efficient are my enterprise areas (profit centers)
z How profitable are individual market segments? z How effective are the sales organizations?
SAP AG 2001
The main
areas in Controlling are used for different tasks and types of analysis:
y Cost Element Accounting classifies the costs and revenues posted to CO. It also enables the reconciliation of the costs in CO with Financial Accounting (FI). y Overhead Cost Controlling examines the causes of costs in the functional areas of an enterprise. In many enterprises, overhead costs have increased rapidly. These include costs that cannot be directly assigned to a product or a service. While strong progress has been made for controlling costs and optimizing processes in the production areas, the overhead costs remain unclear, meaning that it is difficult to judge what caused these costs. Activity Based Costing (ABC) provides you with more ways of allocating costs. y Product Cost Controlling is used for costing and evaluating the cost of goods manufactured for a product, and the costs and possibly revenues when providing a service, or when carrying out a project (plan and actual). This provides the tools for a comprehensive analysis of the value added processes in an enterprise. y Profitability Analysis deals mainly with analyzing the results of enterprise activities on the external market. It enables you to determine how successful the enterprise is in different market segments (product divisions or customers for example) and how this data has developed over a period of time. y Profit Center Accounting analyzes the success of the subareas in the enterprise which are responsible for profits. It can represent the internal market in the enterprise, particularly if the functions of multiple valuation approaches and transfer prices are used. y The cost flow in CO can mean the need for reconciliation between internal and external accounting. In Cost Element Accounting, the reconciliation ledger provides reporting functions for identification of the cost differences between FI and CO. It can also be used for reconciliation posting to Financial Accounting (FI) if required. © SAP AG
AC040
3-11
The Components of Controlling
At the conclusion of this topic, you will be able to: z Name the components of CO z Explain the basic purpose of each component
SAP AG 2001
© SAP AG
AC040
3-12
Overview of CO Components z Cost Element Accounting z Overhead Cost Controlling: Cost Center Accounting
Internal Orders
z Activity-Based Costing z Product Cost Controlling: Product Cost Planning
Cost Object Controlling
Actual Costing/Material Ledger
z Profitability and Sales Accounting Profitability Analysis
Profit Center Accounting
SAP AG 2001
The CO
components can be divided into various groups. The classification indicates the general purpose of a given component.
Management
of an enterprise requires the use of different tools for different situations. If you want to analyze profit, for example, you need a tool appropriate to the desired perspective (for example, product profitability or the profitability of responsibility areas). To meet this requirement, profitability and sales accounting uses two tools (components): Profitability Analysis and Profit Center Accounting.
Likewise,
Overhead Cost Controlling and Product Cost Controlling offer different tools to meet different types of management requirements.
© SAP AG
AC040
3-13
Cost and Revenue Element Accounting
Cost and Revenue Element Accounting
FI
AA
Answers the question:
MM
Overhead Cost Controlling Cost Center Internal Orders
Product cost Controlling
Process
Cost object
SD What costs have been incurred?
HR
Profit Center Invoice
Profitability Analysis
Profit Center
Profitability segment SAP AG 2001
Cost
and Revenue Element Accounting (CO-OM-CEL) is part of Overhead Cost Controlling. It provides a structure for the assignment of CO data by the classification of transaction items. These items are posted to a corresponding controlling object (e.g. a cost center or an internal order) depending on their cost or revenue element.
The cost
flow in CO can mean the need for reconciliation between internal and external accounting. Cost and Revenue Element Accounting is the CO component that supports this reconciliation requirement. The reconciliation ledger provides reporting functions for the identification of cost differences between FI and CO. If required, it can be used for reconciliation postings to Financial Accounting (FI).
© SAP AG
AC040
3-14
Overhead Cost Controlling (CO-OM) and Activity-Based Costing (ABC)
z Overhead Cost Controlling: Cost Center Accounting
Internal Orders
z Activity-Based Costing
SAP AG 2001
Overhead
Cost Controlling has two components. Each addresses certain aspects of analyzing and controlling overhead costs. Overhead costs are defined as costs that cannot be assigned directly to cost objects (e.g. production orders, etc.).
Activity-Based
Costing provides you with more cost allocation options that you can use for the overhead costs in Product Cost Controlling and Profitability and Sales Accounting. You can also assign the process directly from operational systems and thus use it as a cost object.
The percentage
of overhead in total costs has risen sharply in recent years. The number of workers employed in overhead areas grew from 25-30% in the 1950’s to more than 50% today. Overhead has grown in both manufacturing and service organizations. Research in the United States revealed that overhead makes up approximately 80% of the costs in the machine and electronics manufacturing industries. As overhead grows, the proportion of directly assignable production costs shrink. Consequently, it is becoming increasingly important to analyze and control overhead costs. Similarly, increasingly sophisticated tools are needed to facilitate the application of overhead to production orders and other cost objects.
© SAP AG
AC040
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Cost Center Accounting H1
H2100 H2100 Portugal
IDES Europe
H2000 H2000 UK
H1000 H1000
H2300 H2300 Spain
Germany H1010 Group H1110
H1120
The Management
Corporate services
1110 The Management
1000 Corporate services 1200 Cafeteria 1210 Telephone
H1200
H1400
Finance & Administration H1210
H1220
Technical services H1230
Administration Human Resources
Purchasing
2100 Finance & Administration
2300 Purchasing
2200 Human Resources
H1300 Sales & Marketing
1220 Motor Pool 1230
SAP AG 2001 Energy
Cost
Center Accounting (CO-CCA) is for finding out where costs are incurred in your organization. When costs are incurred, you assign them to the corresponding cost center or you post them to this cost center. These costs can include personnel costs, rental costs, or any other costs that can be assigned to an existing cost center.
You
assign each cost center to a cost center type (for example, administration cost centers or production cost centers). In the master record for each cost center, there is a field for the name of the cost center manager.
The posting and assignment
of costs on or to cost centers enables internal accounting, but more importantly, is also a significant requirement for using the other CO components. The following are typical approaches that can be used for defining cost centers: functional requirements, allocation criteria, activity provided, geographical location and or the area of responsibility. The selected approach should, however, be used consistently throughout the entire enterprise.
Cost
centers can be grouped together to provide summary cost information. A basic requirement for setting up Cost Center Accounting is thus the creation of a standard hierarchy for a controlling area. This reflects the whole structure of all cost centers in the controlling area, and provides cost totals at each node of the structure. This will be described in greater detail in the next unit.
The HAC040
HAC040.
© SAP AG
node is used throughout this course. It is under the hierarchy path H1 -> H9500 ->
AC040
3-16
Internal Orders FI
MM
CO
Internal Orders Investment Orders
Overhead Cost Orders
Accrual Orders
Orders with Revenues revenues
Order
G/L Account
Proftblty seg.
project
Proftblty segment
G/L Account
Proftblty segment
Cost Center
Cost Center
Sales order
Assets
Billing element
project
Cost Accounting Functions
Costs
Orders with Revenues
For any receiver
SAP AG 2001
An
internal order is an extremely flexible CO tool that can be used for a wide variety of purposes to document costs and, in some cases revenues within a controlling area. You use internal orders for planning, monitoring and allocating costs.
You
can use internal orders for different purposes. They can be split into four categories:
y Overhead cost orders: monitoring overhead costs that are incurred for certain purpose, such as holding a trade fair, or for the documentation of costs, such as for maintenance and repair tasks. y Investment orders: monitoring costs that are incurred for an asset under construction, for example, a building or a warehouse. y Accrual order: offsetting entry of accrual costs (calculated costs in CO) to cost centers. y Orders with revenues: can be used as cost objects so that costs and revenues can be tracked.
© SAP AG
AC040
3-17
Activity-Based Costing: Model
Process
Process
Process
ABC -PC CO
Product
CO -P A
CO-OM Product Groups Customers Distrib. Channels ...
CO
SAP AG 2001
Traditionally,
overhead costs have been allocated from cost centers to cost objects using various methods such as predefined overhead rates and activity allocation.
Activity-Based
Costing (ABC), however, assigns the costs to business processes without regard to which organizational units caused the costs. A process is a cross-functional object that can use the resources of any cost center in a controlling area.
Activity-Based
Costing has been implemented in the R/3 System as an enhancement to the existing cost management functions. Overhead costs are still assigned to cost centers. The cost centers that use resources necessary for the process allocate the resulting resource costs to the process. (Example: a purchasing cost center allocates the costs incurred in preparing and distributing a quotation inquiry to a procurement process.) The processes are then used by cost objects (such as production orders) and the costs allocated to those cost objects. Process costs that are not assigned to any cost object are transferred to CO-PA to enable more precise and complete settlement of overhead.
Cost
drivers can be used as a basis for allocating process quantities. In principle, any information that exists in R/3 or that you provide can be used as a cost driver. Examples of possible cost drivers: Output quantity or scrap quantity of a production order; number of processed sales order items; number of network operations for a project; information from the material or service master.
Cost
Center Accounting answers the question of where costs were incurred, while Activity-Based Costing answers the question of why (for what purpose) costs were incurred.
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AC040
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Product Cost Controlling (CO-PC)
z Product Cost Controlling Product Cost Planning
Cost Object Controlling
Actual Costing/Material Ledger
SAP AG 2001
Product
Cost Controlling is concerned with all aspects of planning the cost of producing products or services, as well as tracking and analyzing the actual costs. Product Cost Controlling consists of the following components:
Product
Cost Planning is used for preliminary costing purposes and can answer the following questions: y What will the production of a certain product or service cost? y Is external procurement less expensive than on site production?
Cost Object
Controlling focuses on simultaneous costing and the period end closing.
y Actual production costs are cumulated alongside raw material consumption when completing the work. This means that the information provided allows you to compare planned and actual costs for any phase of the production process. y Period end closing calculates the value of goods still in the production process (work in process) and the variances between the cost estimate and the actual costs, and settles them to other modules like CO-PA, EC-PCA and FI. Actual
Costing / Material Ledger is used to provide actual costs for each material at the end of the period. Materials and their movements are valued with a standard price during the period. Any variances with respect to this standard are collected in the material ledger when invoices are received or orders settled. During period closing these variances are used to calculate an actual price for the material in the closed period.
© SAP AG
AC040
3-19
Product Cost Controlling: Overview Product Cost Planning
Cost Object Controlling
Actual Costing / Material Ledger
Quantity Structure: PP Master Data
Preliminary Costing, Simultaneous Costing
Quantity Structure: Material Movements
BOM
Routing
Value Structure Material prices Activity prices Process prices Overhead costs
Costing: Standard costs
Order Plan costs, actual Material UNI costs Labor UNI Overhead UNI Process UNI Sum ... Final Costing Period-End Closing Work in process Scrap Variances Settlement
Process
Value Structure Material Movements Material Ledger
Material settlement: Actual costs
SAP AG 2001
Product
Cost Planning is a set of functions that estimate the costs to produce goods or services. If a quantity structure (bill of material and routing) is available in the PP (Production Planning) component of the R/3 System, the system can automatically create a cost estimate based on this data. If no quantity structure is available in R/3, you can either enter the costing items manually with the unit costing tool or transfer them automatically from a non-SAP system using batch input.
In
Cost Object Controlling, the costs incurred during production of a product or service are collected on cost objects (such as production orders). A number of different types of cost objects are available, depending on your requirements. These include sales orders, production orders, process orders, and production cost collectors. When you run the period-end closing process, Cost Object Controlling calculates work in process, scrap costs, and variances.
Actual
Costing calculates actual product costs at the end of the period. The result of this calculation be transferred into the material master data as a weighted average price for the closed period and used for account-based valuation of warehouse inventory. The values connected with these movements are collected in the Material Ledger. You can use the single-level and multilevel material settlement functions to calculate the actual cost of goods manufactured at the end of the period.
© SAP AG
AC040
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Product Cost Planning
z
Costing Result Cost of goods manufactured
Cost of goods sold
z
Pricing
z
Productivity
z
Comparison of alternatives
z
Continuous improvement
z
Comparison of plants
z
Influence of primary costs
z
Material valuation
SAP AG 2001
Product
Cost Planning can answer a number of frequently asked questions. These include:
y What are the cost of goods manufactured and cost of goods sold for our product? y Is it even possible to manufacture the product at this market price? What is our price limit? y Is it more cost-efficient to produce in smaller or larger lot sizes? y What is the structure of our costs? How high are our material costs in comparison to labor costs? y What are the effects on costs of improving the production process? y Which parts of the organization contribute to the cost of the product? y In which plant would production be most efficient? y What is the impact of energy costs and machinery depreciation on my product (primary costs)? y Standard cost estimates can be used to valuate inventories.
© SAP AG
AC040
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Cost Object Controlling
z
What actual costs has our area caused in the current period?
z
What costs were anticipated based on the output?
z
Are some product groups performing significantly better than others?
z
What is the reason for these variances?
z
How high are the scrap costs of our new product line?
z
Are our continuous improvement efforts having any effect on costs?
SAP AG 2001
Cost
Object Controlling comprises three main steps: Preliminary costing of the cost object, simultaneous costing, and period-end closing.
Preliminary
costing refers to the calculation of planned (i.e. budgeted) costs for a cost object such as a production order. Plan variances can be determined by comparing the results of preliminary cost estimate of the order with the standard cost estimate based on the output to be produced with the order.
As
raw materials are consumed in production (after being either issued from inventory or purchased externally), their value is assigned to the appropriate cost object. Similarly, when a given quantity of units of an activity type (such as hours of direct labor) is consumed during production, the value of that activity is assigned to the cost object as well. This process of assigning costs to cost objects during the production process itself is called simultaneous costing. Costs are assigned to cost objects by the same transaction that documents the issue of a material or performance of an activity. (The transaction that documents the output of a particular number of activity units is called a confirmation.) Simultaneous costing is sometimes referred to as the valuation of quantity flows on a cost object.
Period-end closing refers
to a series of tasks performed at the end of each accounting period. This includes calculating applicable overhead costs, work in process (WIP), variances, and settlement (which passes information to Financial Accounting, Profit Center Accounting, and Profitability Analysis).
© SAP AG
AC040
3-22
Material Ledger Concept Actual Costing
Transparency
Possible inventory revaluation with actual prices
Value Added
Analysis of actual cost component split
Material Ledger Material inventory
Multiple currencies
Multiple Valuations
Translation to historical exchange rates
Transfer Prices
Legal
Group
Profit center
SAP AG 2001
The material ledger is a
tool which collects data for materials where master data has been saved in a material master record. The material ledger uses this data to calculate prices which are then used to valuate the materials. The material ledger forms the basis for actual costing and enables inventory valuation in up to three currencies and/or valuation methods.
As
the subledger for materials, the material ledger is a prerequisite for using multiple valuation approaches. In addition to the standard situation where the inventory value of stock managed on a value basis is only updated in one currency (company code currency), the material ledger enables you to manage the material inventory value in two further currencies. This means that all goods movements in the material ledger are updated in up to 3 currencies/valuation methods. The conversion into foreign currency amounts takes place using historical exchange rates (valid when the posting is made). In addition to this the material ledger allows companies in countries with high inflation the option of managing their material inventory in a hard currency. This means that the effect of inflation on the material inventory value can be seen more clearly.
If
actual costing is implemented, the system can use the values collected periodically to automatically calculate new inventory values and valuation prices independently from one another and in different currencies/valuation methods.
If
transfer pricing is used, the material ledger is then also used to save the three different valution approaches.
© SAP AG
AC040
3-23
Actual Costing Cost Center Accounting Product Cost Controlling
Material Ledger Ending Inv. Price diff. .
Cost center
Activity type
Order
Ending Inv. Price diff. .
Cost center
Activity type
Order
Ending Inv. Price diff. .
Ending Inv. Price diff. .
External Procurement
A SAP AG 2001
SAP AG 2001
You
can assign the variances per material at the end of a period using single-level price determination. It is also possible to proportionally assign the cumulated price differences to the ending inventory quantity and material consumption for the period.
At
the same time the periodic unit price for the inventory can be valuated using the actual price for the period. Price difference assigned to consumption remain in price difference accounts.
When
you settle an order, the system calculates the price differences that occurred during the production process for the respective materials.
In
addition to this, multilevel price determination can also project the variances that occur in higher levels of the production process using a multilevel actual quantity structure.
Through
the quantity structure, a type of actual BOM, the system knows which materials were used to produce which higher level products. It is then possible to calculate the price for the finished goods.
It
is then also possible to roll up price differences, from raw materials to semifinished goods and in the next step to the finished product.
After
executing multilevel price determination, you can recognise the actual prices per material (raw materials, semifinished goods and finished products) using actual costing. Actual Prices are the real price occurred for actual quantities or procured quantity per period.
It
is also possible to revaluate your products or raw materials using the actual price.
The procedure
allows you to use actual costing in parallel to your standard cost accounting, as the values from your standard cost accounting procedures are not debited or credited during subsequent adjustments.
© SAP AG
AC040
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Profitability and Sales Accounting
z Profitability and Sales Accounting Profitability Analysis (CO-PA)
Profit Center Accounting (EC-PCA)
SAP AG 2001
© SAP AG
AC040
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Aspects of Profitability and Sales Accounting
Profit Center Accounting Revenue Salaries Material ... Profit Profitability
2000 468 230
Profitability analysis by market segments Revenue 2000 Discounts 100 COGS 460 Contr. margin 1 1440 Advertizing 230 ...
Profitability segments
Profit Centers
Procurement
Direct labor
Distribution
Sales
SAP AG 2001
Profitability analysis:
y You can use Profitability Analysis (CO-PA) to analyze the profitability of segments in your external market. These segments can be defined by product, customer, geographical area or other characteristics, and by your internal organizational units, for example, company codes or business areas. The aim of profitability analysis is to provide the Board, sales and distribution, marketing, planning and other groups in your organization with support that is market-oriented and aids decision-making. Profit
Center Accounting:
y You can use EC-PCA to analyze internal profit and loss for profit centers. This enables you to valuate different areas or units in your enterprise. You can structure profit centers by region (branches, plants), functions (production, sales) or products (product groups, divisions). Profit Center Accounting is a component from the Enterprise Controlling module.
© SAP AG
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Typical Questions in Profitability Analysis Contribution of individual market segments
Contribution margin target of individual S&D units
Success of marketing activities
Revenue and cost structure
Who are the largest customers and who has the strongest growth?
Has S&D reached its contribution margin target? How successful was the last S&D campaign for a certain product line? What effect does a price determination strategy have on a customer group?
SAP AG 2001
Profitability Analysis (CO-PA)
enables you to analyze the profits and contribution margins for the market segments of your enterprise. CO-PA is designed to support sales and distribution, product management, company-wide planning and decision-making by the use of an external view from a market-oriented aspect.
© SAP AG
AC040
3-27
Profitability Analysis per Market Segment
Customer
Region Area
Sales Quantity Sales revenue Customer discount Sales commission Direct sales costs Net revenue
Sales Office
Product
Reporting Dimensions Answers Profit analyses Revenue Market segments
Direct material costs Variable production costs Contribution margin I Material overhead costs Fixed production costs Contribution margin II Variances Contribution margin III Overhead costs SAP AG 2001 Operative profit
P ro
Lo
fit
Cost
ss
The market
segments are defined by characteristics such as products, product groups, customers, customer groups or geographical areas. You can, for example, analyze the profitability of a particular product group that you are selling to a certain customer (or a certain customer group). If you set up CO-PA in your enterprise, you make yourself very flexible when you select the characteristics that are relevant for the definition of the market segments of your enterprise. Each unique combination of characteristic values (for example, sale of product A to customer Y) defines a profitability segment.
You
also need to specify which of the values that affect profitability are to be analyzed for this object. These values are key figures. You can, for example, define which revenue types and expense/cost categories are to be used for determining a value for the trade margin according to the requirements of your enterprise. CO-PA also provides you the option of choosing relevant values for the different users of your enterprise. If different types of user define the trade margin differently (for example, profitability and sales accounting vs. product management) you can determine different key figures for each trade margin according to each specific requirement.
CO-PA
provides you with a multidimensional reporting tool. This tool can be used for creating reports that analyze data for any market segment and any profitability measure.
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Typical Questions in Profit Center Accounting
Contribution of an organizational unit
Return on investment
What is the operating profit of a profit center?
Which fixed asset value is assigned to a profit center?
Cost management
Which areas of responsibility exceeded their plan during the last month?
Management of internal sales and activity
Which goods and services were provided or sold in the enterprise?
SAP AG 2001
A
profit center is a management-oriented organizational unit used for internal controlling purposes. If you divide your enterprise up into profit centers, you can analyze the areas of responsibility and delegate responsibility to decentral units, which thus become "companies within the company". ECPCA enables you to set up your profit centers according to products (product lines, divisions), geographical factors (regions, offices or production sites) or functions (production, sales).
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Profit Center Accounting
Accounts
Reporting Dimensions
Revenues Deductions Administration overhead Operating profit Payables Accounts receivable Fixed asset capital Asset balance Capital costs
Answers Analyses of profit, balances and financial key figures by profit center Profit
ROI Capital sales Sales revenue
Return on Investment (ROI)
Capital investment
SAP AG 2001
Profit
Center Accounting (PCA) enables you to draw conclusions on the internal aspects of profitability. This internal view of profitability is used for measuring the success of a particular profit center in meeting the profitability goals of a given area of responsibility.
The Information
System provides a tool for evaluating plan and actual data. Numerous standard reports are provided, and you can create your own custom reports as well. Reports can be executed for profit centers or profit center groups. Profit Center Accounting can report on selected balance sheet items, such as assets, AR/AP, material inventory, and work in process. This permits the calculation of certain financial key ratios such as ROI (Return on Investment). Other reporting functions include detailed the provision of information on the source objects (e.g. cost centers, internal orders) that contributed costs posted to profit centers.
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Profitability and Sales Accounting: Methods
Cost-of-Sales Accounting
Period Accounting
Revenue - Sales deductions - Cost of sales
Revenue - Sales deductions +/- Change in inventories +/- Change in assets +/- Change in work in process
Gross operating results -
- Sales/marketing costs - Administration costs - R&D Net operating result
Material costs Personnel costs Depreciation Interest
Net operating result
SAP AG 2001
Two
methods can be used to compile profitability reports: the cost-of-sales method and the period accounting method. Both methods will deliver the same results if they are applied to the same business transactions and are based on the same accounting standards.
Companies
must decide on one of the two methods when they compile their external financial reports. The choice of method is often prescribed by country-specific factors. However, the methods support two different types of analysis, both of which can be useful. Consequently, for internal reporting purposes it may be appropriate to use both methods in parallel.
Cost-of-sales method:
Here the focus is on comparing revenues from goods and/or services that were delivered or provided with the costs/expenses for those items. This method provides profit and loss information that is particularly useful with different types of contribution margin analysis. It is therefore recommended for marketing and product management.
Period accounting: This
method determines the revenue realized for the period and the various costs and expenses (such as personnel costs and depreciation). It also includes the changes in the inventory value, work in process, and assets that have occurred during the period. This method is useful in measuring the profitability of profit centers.
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Integration
At the conclusion of this topic, you will be able to: z Explain the basic integration points between the components of CO. z Explain the basic integration points between CO and other R/3 modules. z Run a simple inquiry in the system on an FI document and any associated CO document(s).
SAP AG 2001
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Cost and and Revenue Revenue Element Element Accounting Accounting Cost
Integration Within CO - Value Flows (1) Profit Center Accounting
Overhead Cost Controlling Cost center
Process
Internal orders
Profit Centers
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There can
be numerous interrelationships between the various CO components. Value flows can occur for many different purposes.
Within the Overhead
Cost Controlling area, costs can be posted to cost centers, internal orders and processes from other R/3 modules (external costs). Cost centers can then allocate costs to other cost centers, to orders, and to processes in Activity Based Costing (ABC). ABC, in turn, can pass costs to cost centers and orders. Internal orders can settle costs to cost centers and to processes in ABC (as well as to other orders).
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Cost and and Revenue Revenue Element Element Accounting Accounting Cost
Integration Within CO - Value Flows (2) Profit Center Accounting
Overhead Cost Controlling Cost center
Process
Internal orders
Product Cost Controlling
Cost Object
Profit Centers
SAP AG 2001
In
addition to other factors, central cost flows can exist between overhead cost controlling and product cost controlling. Cost objects (such as production orders) can receive direct cost postings from FI (assignment of invoice receipt to a cost object), costs from cost centers (if production activities are carried out or from overhead accounting), costs calculated from internal orders and costs allocated from ABC Processes.
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Cost and and Revenue Revenue Element Element Accounting Accounting Cost
Integration Within CO - Value Flows (3) Profit Center Accounting
Overhead Cost Controlling Cost center
Process
Internal orders
Product Cost Controlling
Cost object
Profitability Analysis Profitability segment
Profit Centers
SAP AG 2001
Profitability Accounting components
also are tightly integrated with Overhead Management and Product Cost Controlling. Profit Center Accounting, by virtue of its basic design, receives statistical cost postings from all other CO components.
In
addition to direct postings from FI, Profitability Analysis can receive cost assessments from cost centers and ABC processes, settlements of cost from internal orders, and production variances settled from cost objects.
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FI
AA
Depreciation
Vendor Analysis
Cost and and Revenue Revenue Element Element Accounting Accounting Cost
Integration With Other Modules (1) Overhead Cost Controlling Cost center
Internal Orders
Product cost Controlling
Profit Center Acc.
Process
Cost object Profit Centers
Profitability Analysis Profitability segment
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Data
created in other R/3 modules can have a direct influence on CO, If, for example a non-stock item is purchased, this results in an expense being posted to the general ledger. At the same time, this expense is posted, in the form of costs, to a cost center or other CO Object for which the item was purchased. That cost center’s costs may later be passed on as overhead to a production cost center, or elsewhere in CO.
The Financial Accounting application area
of R/3 is a primary source of data for Controlling. Most expense postings in the general ledger result in a cost posting in CO. These expense posting in the general ledger can be journal postings, vendor invoices, or depreciation postings from Asset Management (FI-AA) or other R/3 Modules.
Revenue
postings also result in postings to CO, CO-PA and Profit Center Accounting.
Both
expense and revenue postings from FI must specify one (or more) object in CO that will receive the cost or revenue data.
There are also
several situations that will cause CO to create postings in FI. These would include reconciliation postings initiated by the reconciliation ledger in CO, inventory postings caused by the delivery of finished goods from production, and settlement of capital costs from the creation of fixed assets.
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HR
Personnel Costs
Cost and and Revenue Revenue Element Element Accounting Accounting Cost
Integration With Other Modules (2) Overhead Cost Controlling Cost center
Internal Orders
Product cost Controlling
Profit Center Acc.
Process
Cost object Profit Centers
Profitability Analysis Profitability segment
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The Human
Resource component (HR) can generate different types of cost postings in Controlling. The HR System offers you the opportunity to allocate labor costs to various controlling objects. In addition to this, planned personnel costs can be transferred and be used for CO planning.
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MM
Purchase order
Goods receipts/ Goods Issue
Cost and and Revenue Revenue Element Element Accounting Accounting Cost
Integration With Other Modules (3) Overhead Cost Controlling Cost center
Internal Orders
Product cost Controlling
Profit Center Acc.
Process
Cost object Profit Centers
Profitability Analysis Profitability segment
SAP AG 2001
The Logistics area
of R/3 also has numerous integration points with Controlling. In the inventory area of Materials Management, a goods issue transaction can create a cost posting in CO to whichever object is specified (e.g. cost center, production order, internal order). Looking from the other direction, CO can cause a posting to inventory (in MM) resulting from the delivery of finished goods from production. In addition, product cost estimates created in CO can update price fields in material master records. Finally, the creation of purchase orders in MM can generate commitment postings within CO.
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SD
PP
Production orders
Customer orders
Cost and and Revenue Revenue Element Element Accounting Accounting Cost
Integration With Other Modules (4) Overhead Cost Controlling Cost center
Internal Orders
Product cost Controlling
Profit Center Acc.
Process
Cost object Profit Centers
Profitability Analysis Profitability segment
SAP AG 2001
The Production
Planning (PP) area of Logistics also works very closely with Controlling. Bills of Materials and routings, which are created in PP, can be utilized in Product Cost Accounting in CO. In addition, PP production orders are one form of cost object utilized to track and control production costs in Cost Object Controlling.
Sales and
Distribution (SD) is a primary source for revenue postings from billing documents to CO. A SD sales order can also be used in conjunction with the make-to-order production scenario in CO, in order to track costs and revenues and evaluate the profitability of the arrangement.
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Transfer Price Concept in R/3
At the conclusion of this topic, you will be able to: z Explain the purpose of transfer prices z Describe how the transfer price concept is
realized in the R/3 System
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Managing a Global Enterprise
D F E
USA
J
III I I I MEX
Management
z z z z
BRA
Globalization and international cooperation Increasing specialization within the group Complex value chains Decentralization of responsibilities
SAP AG 2001
Large
corporations often have a large number of subsidiaries that exchange goods and services among themselves. The continuous increase in specialization among the international subsidiaries of global corporations is increasing the complexity of value chains and leading to further decentralization of responsibilities. Consequently, transfer prices are playing a more significant role in corporate management.
Valuating the
exchanges of goods and services with transfer prices enables you to significantly influence the operating results of your group’s units or profit centers.
A
simple example: When company A sells a product to company B, it realizes revenue that must be reflected in its operating profits. However, if company A and company B are part of the same corporate group, the sale is simply an internal inventory transfer and does not result in any revenue realization within the group. Internal profits can also arise when an exchange takes place between profit centers rather than between two independent subsidiaries of the group.
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Different Views of a Corporate Group
Group View
Group
TP Company CompanyCode Code 11
TP
Production Company CompanyCode Code 22 Semifinished goods Production Finished goods
Company CompanyCode Code 33 Suppliers
Internal View
TP Division Division 11 Profit Center
TP Division Division 22
Legal View
TP
Division Division33
Division Division44
SAP AG 2001
Different
kinds of decision makers in a company require different information.
Consequently,
managers of the individual companies must have access to profitability data that reflects the view of each company while conforming to the financial statements for external reporting.
For
corporate management, the group view normally offers the central perspective. This means that corporate decision making must be based on data that represents the group as a consolidated business unit, without internal revenues.
If
profit centers are treated as independent subsidiaries, profit center managers must have information that is comparable with the information required by individual subsidiaries. In this case, sales between profit centers are treated like sales between independent units rather than internal inventory transfers.
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Multiple Valuation Views
Group
Group
Legal
Profit Center
Group Company 1
Company 2
Company 3
Profit Center 1
Profit Center 2
SAP AG 2001
The view
of the individual company and the valuation of the business transactions in accordance with the legal reporting requirements is only one of several possible perspectives. Concerns regarding financial statements and taxes are of central importance for the financial reports of the individual companies.
In
addition to this legal view, successful management of the group requires information on activities from the perspective of both the entire group and of the individual profit centers.
For
the purposes of cost management for the entire group, these business transactions must be valuated with group production costs. In many corporate groups, management structures do not correspond to the individual units of external accounting. Using internal prices, the activities of the individual profit centers are managed on the basis of market principles. Value flows that are represented from the point of view of the profit center are therefore required to meet the goals of internal management and internal profitability analysis.
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Overview Of Controlling: Summary At the conclusion of this unit, you should be able to: z Explain the differences between Internal and External Accounting. z Explain the role of CO for controlling an enterprise z Explain the components of CO and explain their purpose z Explain the basic integration points between the components of CO. z Explain how CO is integrated with other R/3 components z Explain the transfer price concept in the SAP system
SAP AG 2001
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Exercises Data used in the exercises: You will create most of the data used in the exercises yourself. When you create the data, use the following key: Replace
by....
##
Your group number (01,02,..., 19,20)
Use the following additional information in the exercises: Data used in the exercises: Data
Data in the training system Data in the IDES system
Operating Concern
IDEA
IDEA
Controlling area
1000
1000
Company code
1000
1000
Business Area
9900
9900
Business Area
1000
1000
Profit Centers
1010
1010
Profit Centers
1400
1400
Node in standard hierarchy for cost centers
HAC040
Cost Center
4230
Cost Center
AC040-SERV
Cost Center
PROD00
Cost element group
OAS
OAS
Cost Element
403000
403000
Cost Element
415000
415000
Cost Element
417000
417000
Cost Element
420000
420000
Cost Element
475000
475000
Cost Element
800000
800000
Cost Element
615000
615000
Cost Element
631300
631300
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G/L account cash account
113100
113100
activity type
1421
1421
Material
T-F100
P-100
Material
T-F1##
Material
T-T200
Material
T-SERVICE
Base planning object
T-SERVICE
Order type
0400
0400
Type of statistical order
1000
1000
Vendor
1000
1000
Purchasing organization
1000
1000
Purchasing group
000
000
Plant
1000
1000
Storage bin
0001
0001
Division
00
00
Division
01
01
Sales organization
1000
1000
Distribution channel
10
10
Customer
1000
1000
Personnel number
7017
7017
Contribution margin report
AC040
Enter the following data that you create in the table as a reference for future exercises. Participant data Description
Number
Trade fair order
________________________________________
Production Order
________________________________________
Sales order
________________________________________
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Unit: Controlling Overview Topic: The Components of Controlling
•
Describe the purpose of each component of Controlling.
To provide data for different purposes and different users, you can use different components in Controlling to focus on the appropriate objects.
1-1
What components of Controlling (CO) and Enterprise Controlling (EC) were explained in this unit? _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________
1-2
Briefly, what is the purpose of each component? _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________
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_________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________
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Solutions
Unit: Controlling Overview Topic: The Components of Controlling
•
Describe the purpose of each component of Controlling.
To provide data for different purposes and different users, you can use different components in Controlling to focus on the appropriate objects.
1-1
What components of Controlling (CO) and Enterprise Controlling (EC) were explained in this unit? Overhead Cost Controlling (CO): -
Cost and Revenue Element Accounting
-
Cost Center Accounting
-
Overhead Order Accounting
-
Activity-Based Costing
Product Cost Controlling (CO): -
Product Cost Planning
-
Cost Object Controlling
-
Actual Costing/Material Ledger
Profitability and Sales Accounting:
© SAP AG
-
Profitability Analysis (CO)
-
Profit Center Accounting (EC)
AC040
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1-2
Briefly, what is the purpose of each component? Cost and Revenue Element Accounting provides the structure for assignment of CO data through the classification of transaction line items according to the type of cost or revenue being posted. Cost Center Accounting tracks where costs occur in your organization. Overhead Cost Controlling (internal orders) describes the costs of single tasks (holding a trade fair or building a warehouse for example), or current activities (plant maintenance of an administrative building or running and maintenance costs for a vehicle) within a controlling area. Activity-Based Costing provides a process-oriented view of the organization. It provides more clarity of the activities provided in your enterprise and the costs involved. Product Cost Planning is used to calculate the cost of the production of a material or the provision of a service. Cost Object Accounting deals mainly with monitoring the actual production costs and with period-end closing activities that affect production. Actual Costing/Material Ledger provides the actual costs for each material at the end of the period. Profitability Analysis (CO-PA) enables you to analyze profits and contribution margins for market segments of your enterprise. The objective of CO-PA is to support sales, product management, and corporate-wide planning as well as decision-making, using an external view from a market-oriented perspective. Profit Center Accounting enables you to calculate internal measurements of profitability. It portrays the earnings of each profit center during the attempt of the enterprise to meet the planned profitability targets.
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Representing Your Business in CO: Contents
z Organizational Units and Structures z Basic Data and Structures
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Representing Your Business in CO: Contents
At the conclusion of this unit, you will be able to:
z Identify the basic organizational structures which are relevant to CO, and the relationships between them z Name examples of master data which are relevant to CO, and their purpose z List at least three ways in which groups of master data can be used
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Overview
$
+ABC
t Reporting Tools
OM
PC
Profit
Representing Your Business INT EXTin CO
Planning and Integrated Planning
HR
MM
FI
SD AA
CO DM DM
Postings to CO from Other Components
CO 1
9
12
$
Transaction-Based Postings in CO
AC040
1 12 OM PC Profit FI CO
OM PC Profit
Period-End Postings in CO
FI MM HR AA SD
Overview of Controlling
“Where now?" Navigation
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© SAP AG
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Summary
ASAP: Introduction
Introduction
AC040
4-3
Portraying Your Business in CO: Enterprise Scenario z Each company has an organizational structure that must be reflected in the R/3 system. You are responsible for reviewing the decisions made by the implementation team in this area. z Since your company has elected to use all CO components, you need to familiarize yourself with the basic organizational structures available in CO. Your analysis must focus on whether the appropriate relationships have been defined to support the company’s developments and its key information requirements. z This analysis deals with the relationship between controlling area and company code, and with the definition of areas of responsibility such as cost centers and profit centers. It also includes the production processes and the analysis of profitability for key market segments. This requires an understanding of the different master records used in CO. SAP AG 2001
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Organizational Units and Structures
At the conclusion of this topic, you will be able to: z Identify the basic organizational structures which are relevant to CO z Define the relationships between these organizational structures.
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Organizational Units COPA
Operating Concern
Controlling area
Company code BA1
SD MM
Purchasing organization 1000
PP
BA2 Plant 1000 Plant 1100
A A A
Plant 1200
COOM
COPC
ECPCA
Emphasis: External Accounting
FI
Sales organization 1000
Emphasis: Logistics Procurement and sales
SAP AG 2001
The controlling
area is the basic organizational unit in Controlling. A controlling area is a closed entity used for cost accounting. You can only allocate costs within a controlling area. These allocations cannot affect objects in other controlling areas. You can assign more than one company code to a controlling area. This enables cost accounting across company codes. y Note: The controlling area and its company codes must always use the same chart of accounts and the same fiscal year. (only the number of special periods may vary).
Profitability Analysis (CO-PA)
is used within the operating concern. The operating concern is an organizational unit that represents the structure of external market segments for the enterprise. You can assign several controlling areas to each operating concern, for the purpose of analyzing them together.
The company
code is an independent accounting unit. Financial and profit & loss statements are prepared at company code level to meet legal reporting requirements. Business areas (BA) can be used to group strategical business fields, and for reporting in the form of P&L and financial statements (not suitable for auditing, reporting purposes only). Business areas can also be crosscompany code.
The plant
represents a production unit. It represents the central organizational unit in R/3’s Materials Management and Production Planning. When you define organizational structures, you assign plants to company codes.
The purchasing organization
is an organizational unit of MM Purchasing and the sales organization is an organizational unit in SD Sales & Distribution. Both are only important for CO in that this data needs to be included for integral business processes between Logistics and Accounting.
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Multiple Assignment CO PA
Profitability Profitability
Operating Analysis Analysis Concern
Currency: EURO
Controlling area 1000
z Currency: EURO z Chart of accounts - Operative z Fiscal year variant
FI
Company code 1000
z Currency: EURO z Chart of accounts - Operative INT z Fiscal year variant K4
INT
K4
Profit Center Accounting
CO PC
CO OM
ECPCA
Company code 2000
z Currency: $ z Chart of accounts - Operative INT - Local: CAUS z Fiscal year variant K4
SAP AG 2001
By assigning more
than one company code to a controlling area, you can perform cost accounting for all company codes. You can allocate values in CO that affect more than one company code.
In
cross-company code cost accounting, the controlling area and the company codes can have different currencies. The currency of the controlling area can be the same as that for a company code. It can also differ from the currency of all the company codes assigned to the controlling area.
You
can use three currencies in CO:
y Controlling area currency
y Company code currency OR object currency - Cross-company code cost accounting defaults the company code currency as the object currency. You cannot change this default. If you have only assigned one company code to the controlling area, the object currency can be assigned for each controlling object (such as a cost center) as required. y Transaction currency - The transaction currency is the currency used for posting a document to CO.
You
can assign more than one company code to a single controlling area. All companies in the controlling area must then use the same operative accounts. However, these accounts can be linked to country-specific accounts using the alternative account number that is stored in the master data record for accounts.
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Basic Data and Structures
At the conclusion of this topic, you will be able to: z Name the main types of master data used in each of the components of CO z Explain the purpose of the different types of master data z List at least three ways in which groups of master data can be used
SAP AG 2001
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Accounts and Cost Elements Example: International Chart of Accounts Financial Accounting
Financial Accounting
0
1
2
3
4
7
Material Expense Current Nonassets operating inventory accounts and short- costs, term revenues capital
1
2
3
Material Current Nonoperating inventory assets costs, and short- revenues term capital
Semifinished products and finished products
5
Primary Second ary CElems CElems
8
9
Revenue/ Closing Inventory change/ current internal activity
6
Second ary
Revenue elements
CElems
Controlling
Profit Center Accounting SAP AG 2001
The above
diagram displays the chart of accounts that is used in SAP training systems and in IDES. This is also in the standard system of SAP R/3.
This
chart of accounts is based on process classification. All expense accounts are in a class (class 4) and all revenue accounts are in class 8.
Expense accounts
to which costs are posted for cost accounting purposes must also be created as cost elements in Controlling. This ensures that all postings to this type of expense account always arrive in CO on time.
Procedure:
y Define an expense account or revenue account in FI. y Next, you can create this automatically or manually in CO as a cost element or revenue element. Secondary cost elements
are only defined in CO and used for internal CO allocations (such as assessments or settlements). You do not have any corresponding G/L accounts in FI.
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Cost Elements and Revenue Elements Costs
Management level Primary costs
Secondary costs
Predefined by SAP
Primary CElem categories
Secondary CElem categories
CO master data level
Primary cost elements
Secondary cost elements
FI master data level
FI G/L account
Chart of accounts SAP AG 2001
Expenses
in Financial Accounting (FI) that are cost-relevant to cost accounting, are entered in CO using primary cost elements. The primary cost elements must exist first as general ledger expense accounts in FI before being created, automatically or manually, in CO.
If
a posting is made in FI to an expense account, for which a primary cost element was created, you must enter an account assignment object from CO (for example, a cost center, internal order or cost object). This ensures that it is not possible to post costs in FI without being posted at the same time in CO.
Secondary cost elements
are only used for certain types of internal CO transactions. They have no corresponding G/L accounts in FI. These only exist in CO.
Revenues
from FI can be recorded in CO using revenue elements, similarly to primary cost elements. Again, the revenue account must already exist in FI. Revenues can only be recorded statistically in Cost Center Accounting.
Each
cost element is assigned a cost element category in its master record, which determines the type of transaction for which a cost element may be used. For example, cost element category "1" (primary cost element) is used for posting primary costs in CO. The secondary cost element category "42" is used for the internal allocation of costs (within CO), and cost element category "21" is used for order settlement in CO.
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Master Data in Overhead Cost Controlling Overhead Cost Controlling
Cost Center Process
Internal Orders
Product Cost Controlling
Profit Center Accounting
Cost object
Profitability Analysis
Profit Center
Profitability Segment SAP AG 2001
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Cost Center
Validity Period
Communication Control Data
Basic Data
Cost Center
Address Data
Indicator
SAP AG 2001
The cost
center master record contains different categories of information. The header row of the master record includes the cost center ID, the controlling area to which the cost center is assigned, and the validity date range for the cost center.
Under the "Basic
data" section, there are fields for the name and description of the cost center, the cost center manager, and the department to which the cost center is assigned. The next field is the "cost center type", which identifies the cost center purpose such as production, service, sales, administration, etc.
The "hierarchy area" field shows
the standard hierarchy node to which the cost center was assigned. You need to make an entry in this field. The standard hierarchy is a control feature of Cost Center Accounting. Each controlling area must have a unique standard hierarchy that includes every cost center created in that controlling area.
The company code
and business area fields represent the close ties between CO and FI. If a controlling area has more than one company code, then you need to specfy the company code that is linked to each cost center. If business areas are used for that company code (as defined in FI), then a business area must also be specified in the cost center master record.
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Activity Type
Validity Period
Basic Data
Activity type
OUTPUT
Indicator
SAP AG 2001
The master
data consists of the names for the activity type and controlling area to which the activity type is assigned, as well as the validity period.
The "basic
data" includes fields for the name and description. There is an "activity unit" field in which you specify how the activity type is to be measured (for example, in hours, days or seconds). There is also a "cost center types" field, in which you specify the cost center types that this activity type may provide.
The "default
values for allocation" section in the master record is used for selecting different aspects that specify how the activity type is used in activity allocation. The two most important fields here are "activity type category" and "price indicator". The activty type category specifies how the activity type can be allocated (for example, directly by manual allocation or indirectly by a senderreceiver relationship in an allocation cycle). You use the price indicator to determine how the price is calculated. You can enter the price manually or calculate it by using the plan and actual costs.
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Statistical Key Figures
z A measurable quantity that can be assigned to cost centers, overhead cost orders, business processes, and profit centers z Used as an allocation base (tracing factor) in overhead cost allocations z Two categories: Category 1 = fixed, category 2 = totals z Can be linked to the Logistics Information System (LIS)
Periods
1
2
3
. . . 12
Cat. 01
Employees
20
20
20
20
Cat. 02
Counter
1300
1355
1275
1325
SAP AG 2001
Statistical key figures
are measurable values applicable to cost centers, profit centers, internal orders, or processes. An example would be the number of employees in the cost center Transportation which performs activities such as vehicle maintenance.
You
can use statistical key figures as an allocation base (or tracing factor in CO terminology) for periodic allocations such as distribution or assessment, as well as for analysis purposes (such as to calculate the rent cost per employee).
You
can define a statistical key figure as a fixed value or a totals value:
y Fixed values are carried over from the periods in which they are posted to all subsequent periods of the same fiscal year. This is useful for statistical key figures that tend to remain relatively constant over time, such as the number of employees. You only need to update the data when the value changes. y Totals values are not transferred to subsequent periods but must be entered individually for each period. This is preferable for statistical key figures whose values tend to change from period to period, such as kilowatt hours of electricity usage. You
can also transfer statistical key figures values from the Logistics Information System (LIS). This is accomplished by linking a key figure from LIS to a statistical key figure in Cost Center Accounting.
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Internal Order
Order Type
General Data
Assignments Internal orders
Details Period-End Closing
Control Data
SAP AG 2001
You
use internal orders for planning, collecting, monitoring and settling costs of certain operations and tasks in an enterprise. You can use the R/3 System to control your internal orders during the complete life cycle (from creation through to final settlement, including planning and posting actua. costs).
You
can use internal orders for different things. This functional classification is represented in the different order types, which are used to determine how the orders are processed in the system. The general categories of internal orders contain overhead cost orders, investment orders, accrual orders and orders with revenues.
The most
important field in the order master data is that of the order type. Orders are divided into different types depending on what they are being used for. The order type enables the default values for the different master data fields to be determined, and also the definition of certain order characteristics, such as the settings for settlement, planning and budgeting.
The master record
of an internal order comprises several different sections that are represented by a tab page with predefined field groups. You can change the tab page title in Customizing, and assign different fields to the tab pages.
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Business Process
Organizational Units
Basic Data
Business process
Attributes
Allocation
SAP AG 2001
A
business process describes a business transaction or series of actions that consume resources and may be involved in more or one organizational units of an enterprise.
The master record
header information contains the business process ID number and description, the controlling area to which it is assigned, and the validity period.
The master record consists of
allocation.
four main areas: basic data, organizational units, characteristics and
The Basic
data area contains the text descriptions, name of the responsible person, the item (node) of the process in the standard hierarchy, the company code and assigned business areas, the process currency (object currency), and the assigned profit center. There is also a field for the business process type. This is used for standard allocation. In the last field you can specify the template need for structured processes.
The org.
units area contains fields for the assignment of business processes to a plant, sales area (combination of sales organization, distribution channel and division), cost center, and cost center group.
In
the allocation area, data is used to specify how the process can be used for allocation. It includes the unit of measure, the allocation cost element that is used in process allocations, and the method in which the process unit price is to be calculated (price indicator).
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Master Data Groups
Cost elements
Cost centers
Activity types
Statistical key figures
Internal orders
Personnel
Motor Pool
Production Hours
Employees
Trade Fair
Wages Salaries
F1
F2 F3
Temp. FST1 PDH2 Perman. PDH1 empl.
Domestic
The Processes
Sales
Ord. Cust. Abroad Receipt suppt
SAP AG 2001
Master data
groups enable you to group different master data from CO-OM for analysis purposes (reporting), for planning and for allocation. These groups are used for processing more than one master data record in a single transaction. Example: For a cost planning transaction that you only use once, you could enter the planning data for all of the cost elements used by your cost center, by creating a corresponding cost element group and entering this on the planning screen. Similarly, you can produce a report summarizing the results for all the cost centers that you manage by creating the cost center group, and then specifying it in your report definition.
When
using these groups in reporting, each hierarchical level can produce automatic totals of the levels beneath it. The master data itself is assigned to the lowest level nodes in the structure. The R/3 System checks that a value (cost center, cost element, activity type, etc.) is represented only once in the group. You can create as many different groups as you require. Each value can be used in more than one group.
The standard
hierarchy for the cost center is a special type of cost center group. Each controlling area must have a unique standard hierarchy. All cost centers in this controlling area must be assigned to a node on the standard hierarchy.
You
can only use each name of a master data group once in a client. If, for example, you create a cost center group called "tools management", you cannot use this name for another group.
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Master Data in Product Cost Controlling Overhead Cost Controlling Cost center Process
Internal Orders
Product cost Controlling
Profit Center Accounting
Cost object
Profitability Analysis
Profit Centers
Profitability segment SAP AG 2001
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Master Data in CO-PC Material Master
BOM 2
1
1
3 4
5 The material master contains data that represents products, assemblies, raw materials, documents, and so on.
A BOM is a complete, formally structured component list for a product or assembly.
Work Center
Routing
A work center is the physical location where an operation is performed. Each work center is assigned to a cost center.
10 min
5 min
A routing describes a sequence of process steps, and determines the activity quantities used by Cost Center Accounting.
3 min SAP AG 2001
Master data
enables cost objects to be created quickly and economically in the SAP System. The basic data above are copied into the quantity structure of a production order, for example. y The material master is used to represent raw materials, assemblies, and products. y A BOM is a list of the components used in an assembly or product. y A work center is a physical location at which operations are performed. When the master record for a work center is created in production planning, it is linked to the cost center and to the various activity types of the cost center. This link enables the price of the activity type to be accessed. The activity price is used to valuate the labor or machine time that is made available by the cost center during the production process. y A routing describes a sequence of process steps, and determines the activity quantities used by Cost Center Accounting.
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Product Cost by Order
When is it used? Lot Lot
Workplace 2 Workplace 1 Production Order M
Lot
Workplace 3
z
Very flexible production environment
z
High set-up costs
z
Complete costs required
z
Controlling according to individual production lots required
z
Example: Order-Related Manufacturing
SAP AG 2001
Product
Cost by Order relates to lot-orientated production of goods and services, which means the view is always set on a fixed quantity (lot size). A period exact display of costs in reporting is also possible.
Example:
Product Cost by Order using a production order for a specific quantity which is manufactured and then delivered to the warehouse. Sales order are also lot size-relates because they are also created for specific quantities.
For
each production order you can:
y Calculate planned and actual costs y Transfer actual costs to other objects in the R/3 System y Analyse planned and actual costs When
using Product Cost by Order, you can:
y Find out which costs are not yet settled to production orders, and transfer the period’s work in progress for each order to Financial Accounting and Profitability Analysis. y Discover the production variances that occurred for each order and transfer these values as costs for the period to Profitability Analysis. y Determine scrap costs and transfer these periodically to Profitability Analysis.
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Product Cost by Period
When is it used?
am-line1
Line am-100 am-110
am-120
am-200 am-210
am-220
z High number of units manufactured z Constant and continuous production z Individual lot related controlling is not required z Cost collection using Product Cost Collector z Example: Repetitive manufacturing
Cost collector M
SAP AG 2001
Product
Cost by Period relates to time-orientated production of goods and services, which means the view is always set on a fixed amount of time (period).
Example:
Periodic production using a product cost collector (for example mass production), whereby entering a production quantity is not possible. An internal order or project can also be periodic as they do not generally relate to a fixed quantity of goods or services.
The following applies for mass
production:
y The planned requirements for mass production are normally generated automatically by Materials Requirement Planning (MRP), however they can also be created manually. Production planning and control uses planned orders for capacity requirements planning and leveling. y In contrast to Product Cost by Order, planned orders are not converted and production takes place using the planned orders, which adopt all logistical functions. A cost object is opened to record cost postings, however it does not contain a lot size. It is valid for a fixed amount of time (set by the user) and is periodically closed for cost controlling purposes. You can use the same cost object in the following period, and in certain circumstances over the complete product life cycle.
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Product Cost by Sales Order
When is it used? Sales order
M
z Costs and revenues independent of production scenario are collected on a sales order z Collection of special sales costs on sales order z Calculation of work in progress and proportional cost of sales for results analysis z Example: Controlling a complex make to order project
SAP AG 2001
Product Cost by Sales Order relates to the production of goods and services for a specific customer (requirement) know at the point of production. Sales orders always refer to a specific quantitiy. However you can choose whether the sales order should also be a cost object (sales-order related production with sales order controlling) or whether it only transfers the requirement to Logistics and is not relevant for Controlling (sales order-related production without sales order controlling). Examples of sales order-related production with sales order controlling include: yManufacturing a product whereby the costs and revenues are to be analysed at sales order level. yProviding a service, whos costs are credited to a sales order and whos revenues are posted using a
billing document or a resource related billing document.
Product Cost by Sales Order is especially suited to complex make-to-order environments. The combination of a sales order with a project is also possible for particularly complex make-to-order situations (customer project production). Using this function you can: yCalculate and analyse planned and actual costs per sales order item. yCalculate and analyse planned and actual revenues per sales order item. yCalculate the value of your stock for semifinished and finished products. yTransfer data to Financial Accounting (FI) yTransfer data to Profitability Analysis (CO-PA) yTransfer data to Profit Center Accounting (EC-PCA) © SAP AG
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Master Data in Profitability and Sales Accounting Overhead Cost Controlling
Cost Center Process
Internal Orders
Product cost Controlling
Profit Center Accounting
Cost object
Profitability Analysis
Profit Center
Profitability segment SAP AG 2001
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Types of Profitability Analysis Costing-Based
Account-Based Value Fields Revenues Sales Deductions Net Revenue Material Costs Production Costs Production Variances Contribution Margin 1 Material Overhead Production Overhead Contribution Margin 2 R&D Marketing Costs Admin. Costs Contribution Margin 3
Cost/Revenue Elements 800000 Revenue 808000 Sales deductions
1,000,000 100,000 -------------900,000 400,000 190,000 10,000 -------------300,000 50,000 50,000 -------------200,000 10,000 50,000 40,000 -------------100,000
Net Revenue 893000 Cost of Sales 231000 Price Variances
651000 R & D Costs 671000 Marketing Costs 655000 Admin. Costs Operating Profit
1,000,000 100,000 -------------900,000 690,000 10,000
10,000 50,000 40,000 -------------100,000
SAP AG 2001
Profitability
Analysis is an application belonging to the component Controlling and is denoted by the abbreviation CO-PA. Within Controlling, two modules have been designed specifically for certain types of profitability reporting:
Costing-based Profitability
Analysis:
y Reports display values by "value field" (flexibly-defined key figures) y Other anticipated values, such as accrued freight costs, can be added y Uses CO-PA-specific database tables y Revenues and cost of sales are produced simultaneously when the billing document is calculated Account-based Profitability
Analysis:
y Reports display values by cost elements and revenue elements y Reconciles directly with Financial Accounting at the account level y Shares data tables with other CO applications, such as Cost Center Accounting y Revenues are posted when the billing document is created, whereas cost of sales are updated at the point of goods issue.
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Basic Concepts of CO-PA
Federal land Sales rep.
W
P. R G
N
North Prod1 Electronics Cust1 Wholesale trade Bavaria Miller
S
Sales region Product Product group customer Cust. grp
Values REGION
Characteristics
T. S U
Food
Bicy.
C Electr.
PRODUCT GRP Revenues
Value fields Revenues 800 Sales, discounts and returns 100 COGS 650
Sales, discounts and returns COGS Profitability segment
SAP AG 2001
The following are important
in CO-PA:
y Characteristic - Answers the following question: "What is the report to be about?" - Examples: Divisions, regions, products, customers y Characteristic value - Answers the following question: "What values can these characteristics have?" - Examples: the southern region, the northern region. y Value field - Answers the following question: "Which key figures do I want to monitor and analyze?" - Examples: Gross sales, surcharges, discounts, cost-of-sales A
profitability segment defines a specific value combination of all characteristics, which corresponds to a market segment.
A
profitability segment is automatically generated as soon as it is addressed.
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Profit Center
Validity Period
Company Code Assignment
Profit Center
Address Data Communication Data
Basic Data
SAP AG 2001
The Profit
Center master record is relatively simple. The header contains the profit center ID, controlling area, and validity date range. There are text fields for the name and description of the profit center.
The "basic
data" area contains three fields: The name of the person in charge of the profit center, the department name, and profit center group ID. This last field refers to the location of the profit center within the profit center standard hierarchy for that controlling area.
By selecting the lock indicator,
you can prevent the profit center from receiving any postings. The lock is valid for the specified validity period. If a locked profit center is assigned to an object (such as a cost center, production order, or internal order) and a posting is attempted to that object, the system displays an error message and does not post the data.
Using the
pushbuttons on the master data screen, you can access additional information where you can enter other information about the profit center, such as an address, telephone number or fax.
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Profit Center Assignments
Profitability segments Cost center, center, business process Cost object
Sales order Profit center
Internal order, order, project
Asset
Product order
Material
Profit centers SAP AG 2001
When
you install Profit Center Accounting, you assign a particular profit center to each object for which costs or revenues are incurred in your system.
When the
data is posted to the original object, the system automatically posts this data to Profit Center Accounting. This way, the actual data for the assigned objects in Profit Center Accounting is updated. You can also do the same for planning data. However, this data can alternatively be derived in the form of a summary from planning in the CO components if required.
Cost
centers, business processes, internal orders, projects, production orders and cost objects have a field for profit center assignments in their master records.
A
project, for example, crane building, normally affects more than one profit center (e.g. design of the motor, building the frame etc.). The different operative structures WBS element, network header and network can therefore be assigned to separate profit centers.
When the
profit center assignment is determined in the sales order, the revenue postings are transferred to Profit Center Accounting.
Profitability segments
do not have a master record. A profitability segment is a combination of characteristics such as customer, product, plant or distribution channel. One of these is always the profit center. The profit center can be automatically derived from the material, plant or from other characteristics. You can, however, enter it manually too.
Fixed assets are
assigned to profit centers indirectly by means of the cost centers stored in the fixed asset master record.
This
means that a profit center is the summary of all posted values for all assigned account assignment objects. Further allocations between the profit centers are possible.
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Representing Your Business in CO: Summary At the conclusion of this unit, you will be able to: z Identify the basic organizational structures which are relevant to CO, and the relationships between them z Name examples of master data which are relevant to CO, and their purpose z Name at least three uses of master data groups
SAP AG 2001
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Exercises Unit: Representing Your Business in CO Topic: Organizational Units and Structures
•
Identify the basic organizational structures used in CO and explain the relationships between them.
Each company has its own particular organizational structure, which must be "mapped" into the system. You define the structure of your company using the organizational units available in R/3.
1-1
© SAP AG
Think about how your company might best be represented in the system with the organizational units discussed in this unit. Draw the structure.
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Unit: Representing Your Business in CO Topic: Basic Data and Structures
•
Create CO master data.
•
Use master data groups.
Depending on your business requirements, you use different application components to provide particular data. In these components, you use master data to which you can assign, allocate, and plan revenues and costs. You will create a number of master records in Overhead Cost Controlling to manage your overhead costs. To show who is responsible for which costs, you split your company into different cost responsibility areas, which are represented by cost centers. If you also use profit centers – which are profit responsibility areas – you should assign the cost centers to the appropriate profit centers. To determine a quantifiable output of a cost center, you can use activity types. Only cost centers can produce an activity type. In activity planning, you will assign the activity types to the appropriate cost centers. The activity type master records can only be used to post actual costs after you have made this assignment. To facilitate analysis, you would like to provide additional information other than costs and revenues. You use statistical key figures for this purpose. Statistical key figures are measurable quantities that are planned on cost centers or internal orders or that can be posted as actual data. In addition to managing costs by organizational units (cost centers), you also want to manage costs for internal tasks that are undertaken within your company. You will create overhead orders to collect these costs. As with cost centers, you should assign your order to the appropriate profit center if you use profit centers. At the end of the accounting period, the order costs will be allocated to the cost center responsible for the costs.
The first time you access a Controlling function after logging onto the system, the Set Controlling Area dialog box appears. If this dialog box appears, enter 1000 as the controlling area.
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2-1
Create a new cost element. 2-1-1 Create a secondary cost element 6200## in the controlling area CO Europe (1000). Make sure that the cost element is valid for the entire fiscal year. Name the cost element DAA Check Assets, enter a suitable description, and assign the cost element category 43. Save the new cost element. 2-1-2 How can you use this cost element in the system? _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________
2-2
Create two cost centers in the controlling area CO Europe (1000) and in the company code of the German subsidiary (1000): an internal service cost center and a production cost center. Make sure that the cost centers are valid for the entire fiscal year and that they are assigned to the HAC040 node in the standard hierarchy. 2-2-1 Cost center SERV-##, Group ## Services, is a service cost center category (H), which will be assigned to the business area Corporate Other (9900) and to the profit center Internal Services (1400). Make sure that the cost center is only locked against planning and posting revenues. Save the cost center master data. 2-2-2 Cost center PROD-##, Group ## Production, is a production cost center category (F), which will be assigned to the business area Mechanical Engineering (1000) and the profit center High Speed Pumps (1010). Make sure that the cost center is only locked against planning and posting revenues. Save the cost center master data.
2-3
To be able to address both new cost centers at the same time, create a cost center group that contains both cost centers. Give the cost center group the designation CENTERS-## and the description Group ## cost centers. Assign this group to both the production cost center and the service cost center (PROD-## and SERV##). Do not assign your cost center group to the standard hierarchy.
2-4
Create activity types to describe the production output of the new service cost center. 2-4-1 Display activity type 1421 in the system and look at the master data information. 2-4-2 Create activity type REP-##. You may copy from activity type 1421. Make sure the activity type is valid for the entire year. This activity type is for repairs on your group’s assets, therefore its name and description is Repair Group ##. The activity type category is manual entry, manual allocation (1) and the allocation cost element is DAA Repair Hours (615000).
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2-4-3 Create activity type CHK-##. You may copy from activity type 1421. Make sure that the activity type is valid for the entire year. This activity type is for checking your group’s assets, therefore its name and description is Check Assets Gr ##. The activity type category is manual entry with manual allocation (1), and the allocation cost element is your new cost element DAA Check Assets (6200##). 2-5
Create a statistical key figure EMPL##, Number of Employees with a fixed value to record the number of employees in your cost centers. Use the unit of measure for pieces (PC).
2-6
To enable more detailed cost analysis, you want to record the costs connected with your firm' s participation at a trade fair both on a cost center and separately. Create an overhead order using the Order Manager. The costs will be allocated to this order in each accounting period. 2-6-1 Use the order type Internal Order – Marketing (0400). Give your order the name Trade Fair Group ## and assign it to the business area Corporate Other (9900) and profit center Internal Services (1400). Specify your service cost center (SERV-##) as the responsible cost center. Do not save your order yet. 2-6-2 Create a periodic settlement rule to settle 100% of the actual costs to your service cost center (SERV-##). Save the order. Record the order number on your data sheet.
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Solutions Unit: Representing Your Business in CO Topic: Organizational Units and Structures
•
Identify the basic organizational structures used in CO and explain the relationships between them.
Each company has its own particular organizational structure, which must be "mapped" into the system. You define the structure of your company using the organizational units available in R/3.
1-1
© SAP AG
Responses will vary.
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Unit: Representing Your Business in CO Topic: Basic Data and Structures
•
Create CO master data.
•
Use master data groups.
Depending on your business requirements, you use different application components to provide particular data. In these components, you use master data to which you can assign, allocate, and plan revenues and costs. You will create a number of master records in Overhead Cost Controlling to manage your overhead costs. To show who is responsible for which costs, you split your company into different cost responsibility areas, which are represented by cost centers. If you also use profit centers – which are profit responsibility areas – you should assign the cost centers to the appropriate profit centers. To determine a quantifiable output of a cost center, you can use activity types. Only cost centers can produce an activity type. In activity planning, you will assign the activity types to the appropriate cost centers. The activity type master records can only be used to post actual costs after you have made this assignment. To facilitate analysis, you would like to provide additional information other than costs and revenues. You use statistical key figures for this purpose. Statistical key figures are measurable quantities that are planned on cost centers or internal orders or that can be posted as actual data. In addition to managing costs by organizational units (cost centers), you also want to manage costs for internal tasks that are undertaken within your company. You will create overhead orders to collect these costs. As with cost centers, you should assign your order to the appropriate profit center if you use profit centers. At the end of the accounting period, the order costs will be allocated to the cost center responsible for the costs. The first time you access a Controlling function after logging onto the system, the Set Controlling Area dialog box appears. If this dialog box appears, enter 1000 as the controlling area.
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2-1
Create a new cost element. 2-1-1 Create a secondary cost element 6200## in the controlling area CO Europe (1000). Accounting → Controlling → Cost Center Accounting → Master Data → Cost Element → Individual Processing → Create Secondary Enter 6200## as the cost element. Enter the first day of the current fiscal year in the Valid from field. Enter the last day of the current fiscal year in the To field. Choose Master data. Give the cost element the name DAA Check Assets and enter a suitable description. Enter 43 in the CElem category field. Choose Save. 2-1-2 How can you use this cost element in the system? By defining this cost element as a cost element category 43, you have stipulated that it will be used for internal activity allocations or process allocations. Internal activity allocations result in a flow of costs (more precisely: a flow of valuated quantities) from a cost center to other controlling objects (cost centers, overhead orders, production orders, and so on) based on the number of units of activity provided by the sender to the receiver. The allocated costs are posted using this cost element category.
2-2
Create two cost centers in the controlling area CO Europe (1000) and the company code of the German subsidiary (1000): 2-2-1 Accounting o Controlling o Cost Center Accounting o Master Data o Cost Center o Individual Processing o Create Enter SERV-## as the cost center. Enter the first day of the current fiscal year in the Valid from field. Enter the last day of the current fiscal year in the To field. Choose Master data. Enter Group ## Services in the Name field. Enter any name in the Person responsible field. Enter H in the Cost center category field. Enter HAC040 in the Hierarchy area field. Enter 1000 in the Company code field. Enter 9900 in the Business area field. Enter 1400 in the Profit center field. Switch to the Control tab. Under Lock, only Actual revenues and Plan revenues should be selected. Choose Save.
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2-2-2 Create a second cost center with reference to your first cost center. Enter PROD-## in the cost center field, check the from/to validity (current fiscal year) and enter SERV-## as the reference cost center. Choose Master data. Enter Group ## Production in the Name field. Enter any name in the Person responsible field. Enter F in the Cost center category field. Enter HAC040 in the Hierarchy area field. Enter 1000 in the Company code field. Enter 1000 in the Business area field. Enter 1010 in the Profit center field. Switch to the Control tab. Under Lock, only Actual revenues and Plan revenues should be selected. Choose Save. 2-3
To be able to address both new cost centers at the same time, create a cost center group that contains both cost centers. Accounting o Controllingo Cost Center Accounting o Master Data o Cost Center Group o Create Enter CENTERS-## in the Cost center group field. Choose Hierarchy. Enter Group ## Cost Centers in the description field. Choose Insert Cost Center. Enter both PROD-## and SERV-## in the left column. Choose Save.
2-4
Create two activity types to describe the production output of the new service cost center. 2-4-1 Display activity type 1421 in the system. Accounting o Controlling o Cost Center Accounting o Master Data o Activity Type o Individual Processing o Display Enter 1421 in the Activity type field. Choose Master data. Check the master data. 2-4-2 Create activity type REP-##. Accounting o Controlling o Cost Center Accounting o Master Data o Activity Type o Individual Processing o Create Enter REP-## in the Activity type field. Enter the first day of the current fiscal year in the Valid from field. Enter the last day of the current fiscal year in the To field.
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Enter 1421 as the activity type under Copy from. Choose Master data. Enter Repair Group ## in the Name and Description fields. Verify that the activity type category is 1. Enter 615000 as the allocation cost element. Choose Save. Remain in the screen Create Activity Type: Initial Screen for the next exercise. 2-4-3 Create activity type CHK-##. Enter CHK-## in the Activity type field. Enter the first day of the current fiscal year in the Valid from field. Enter the last day of the current fiscal year in the To field. Enter 1421 as the activity type under Copy from. Choose Master data. Enter Check Assets Gr ## in the Name and Description fields. Verify that the activity type category is 1. Enter 6200## as the allocation cost element. Choose Save. 2-5
Create statistical key figure EMPL-##, Number of Employees. Accounting o Controlling o Cost Center Accounting o Master Data o Statistical Key Figures o Individual Processing o Create Enter EMPL## as the statistical key figure. Choose Master data. Enter Number of Employees in the Name field. Enter PC in the Stat. key fig. UnM. field. (The setting for the key figure category should default to fixed value.) Choose Save.
2-6
Create an overhead order using the Order Manager. 2-6-1 The menu path is: Accounting o Controlling o Internal Orders o Master Data o Order Manager Click on the pushbutton Create and enter order type 0400. Enter Trade Fair Group ## in the Short text field. Switch to the Assignments tab. Enter 9900 in the Business area field. Enter 1400 in the Profit center field.
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Enter SERV-## in the Responsible CCtr field. Do not save the order master record yet. 2-6-2 Create a settlement rule for periodic settlement. Click the pushbutton Settlement rule. Enter CTR in the Cat field. Enter SERV-## in the Settlement Receivers field. Enter 100 in the % field. Enter PER in the Settlement type field. Choose Save. Write down the order number. Note: Your order number appears on the left side of the screen. You will notice that all orders you processed will be listed there, together with some important information. You can see more of this information by increasing the width of the panel with the mouse. You can change which information is displayed here by selecting a different layout. You can also create your own layouts. You can jump directly to any order by clicking on the order number. You can sort and filter the list of orders, and switch to collective processing mode.
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Reporting Tools: Contents
z Overview of Reporting z Report Writer Reports z Drilldown Reporting
z ABAP List Viewer (ALV)
z Report Definition with the Report Painter
SAP AG 2001
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Reporting Tools: Unit Objectives
At the conclusion of this unit, you will be able to: z Name the different reporting tools available in Controlling z Explain the purpose and features of the different reporting tools
SAP AG 2001
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Overview $ + ABC
t
Reporting Tools
HR
MM
FI
SD AA
DM DM
Planning and Integrated Planning Posting to CO from Other Components
CO 1
9
12
$
Transaction-Based Postings in CO
OM PC Profit Representing Your Business in CO
CO
AC040
1 12 OM PC Profit FI CO
INT EXT OM PC Profit
Period-End Postings in CO
FI MM HR AA SD
Overview of Controlling
“Which key?" Navigation
SAP AG 2001
© SAP AG
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Summary
ASAP: Introduction
Introduction
AC040
5-3
Reporting Tools: Business Scenario z The next stage of your system review involves the area of reporting. You are well aware that reporting requirements can vary substantially throughout an organization. z You talk with a number of different managers with different information needs to assess the adequacy of their current reports. You come to the conclusion that in many cases, the standard reports supplied with R/3 are sufficient. z But you also find that in some instances, custom reports are required to meet specialized needs. You learn that there are different reporting tools available to create custom reports.
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AC040
5-4
Reporting Tools of CO
z Reporting tools:
Report Painter/Report Writer
Drilldown reports
ABAP List Viewer (ALV)
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A
number of different reporting tools are used in the Controlling information system. Each tool has its own special features and area of application.
The Report
Writer enables you to use data from CO and other R/3 applications in reports, and modify the reports according to your specific requirements. For many of your reporting requirements, you will find that the standard reports available in the different CO application components are entirely sufficient.
The Report Painter
is similar to the Report Writer, but is easier to use. Most of the functions of the Report Writer are also available in the Report Painter. However, you don’t need comprehensive knowledge of the Report Writer before you can use the Report Painter.
Drilldown
reports are used in Profitability Analysis (CO-PA) and Product Cost Controlling (COPC). This reporting tool uses characteristics to classify the data of the business transactions. Examples of characteristics are controlling area, company code, customer, product group, order, and product. The time dimension (fiscal year, period) is also a characteristic. Key figures represent specific values of the classified data. You can use key figures to perform calculations that derive values such as revenue per employee and the contribution margin.
The ABAP
List Viewer standardizes and simplifies list output in the R/3 System. The List Viewer is used in CO for line item reporting. All lists have a uniform interface and format. You can also create your own display layouts. These layouts enable you to change the format of your lists. You can add fields to a list, change the sequence of fields, and change the column width.
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AC040
5-5
Report Selection
Information System
-
+ +
Plan/Actual Comparisons Cost Centers: Actual/Plan/Var. Area: Cost Centers Area: Cost Elements Cost Centers: Cur. Period/Cum. + Additional Characteristics + Additional Key Figures Actual/Actual Comparison Target/Actual Comparisons
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Data is
evaluated in Controlling using the reports that are provided in the standard system or that you define yourself.
The standard reports
you want to work.
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are supplied in client 0. You must import the reports into the client in which
AC040
5-6
Report Painter/Report Writer
-
Cost Element/Cost Center Actual/Plan: Profitability Report ***** Cost Element/Cost Center Actual/Plan ***** Reporting period .... 1 to 03
2000
Cost Elements / Cost Centers
Actual Costs
**
Other administration costs
Date 07/04/00 Planned Costs
Var. (abs.)
6,477,800.00
3,238,900.00
3,238,900.00 -
2210
Energy
112,000.00
56,000.00
56,000.00 -
*
481000
Depreciation
112,000.00
56,000.00
56,000.00
**
Accrued costs 2110 Goods receipt 2120 Warehouse, receipt 2130 Warehouse, issue 2310 Building admin. 2320 Warehouse building
112,000.00 566,000.00 849,000.00 1,414,999.84 590,000.00 900,000.00
56,000.00 283,000.00 424,500.00 707,499.92 295,000.00 450,000.00 -
56,000.00 283,000.00 424,500.00 707,499.92 295,000.00 450,000.00
2330
Production building
1,340,000.00
670,000.00 -
670,000.00
511111 2110
Assessment Goods receipt
1,277,159.92
638,579.96
638,579.96 -
*
SAP AG 2001
In
addition to using the standard reports, you can also use the Report Painter and Report Writer to define your own custom reports.
In
the interactive information system, you can valuate posted data immediately after it is recorded in the R/3 System, and trace the source of the data down to the document level. Both the Report Painter and the Report Writer provide a variety of functions with which data can be displayed, sorted, filtered, and totaled.
You
can modify Report Painter reports with the Report Writer, but reports modified in this way can no longer be edited with the Report Painter. Report Writer reports cannot be modified with the Report Painter.
When
you create your own custom reports with the Report Painter, you define the report rows, the report columns, and the general data selection. The Report Painter can access data in an extract, direct from the database, or from an archive.
All
reports that are available online can be run in the background at a predefined time. This can be particularly useful during a process (such as the period-end close) when you want to run different reports for different users. Background processing enables you to process large amounts of data at times when system utilization is low.
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AC040
5-7
Options in Report Writer Reports Graphics
Internet
Summation Level
Export
** Debit ** Credit ** Overabsorption
Threshold Value Print
Number Format 100.00 100
Call Report Sort Rows
Show/Hide Rows
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Once
you execute a Report Writer report, you have a variety of options for analyzing the data. These options assist you in navigating through the data and changing the report layout. You can modify the report online to meet your specific requirements.
The most
important of these functions can be accessed with the buttons in the output screen of the report. You can access other functions with the menu. Some examples of these functions include: y Downloading the report to your PC (as a Microsoft Excel spreadsheet, for example) y Setting threshold values to highlight or skip certain rows of the report
y Mailing reports using the Send function. To do this, you have to have saved the report in an extract.
y Additional functions: Sorting rows, hiding rows, changing the number format, entering a summation level to see only the totals, and producing graphical renditions of the report data
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AC040
5-8
Drilldown Reporting
Sales Report: Divisions Periods 1 - 7, 1999 Characteristics Customer group Sales organization Material group Division
Revenue Cost of sales CM1 CM1 % Sales & admin.
Division 01 02 03
Revenue Cost of Sales CM1 Auto Bicycle Parts
1,000,000 250,000 100,000
800,000 150,000 70,000
20% 16% 30%
Revenue - Divisions
1,000,000 800,000 200,000 20% 50,000
1000000 500000 250000 0
Auto
Bicycles
Parts
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You
can recognize drilldown reports by the characteristics you can use to navigate in the report. Examples of drilldown reports are the reports in CO-PA.
You
can summarize the data according to the characteristics and then drill down interactively in the report. At each level of the report, you can display the drilldown list (overview) or the detailed list.
In
the example above, the drilldown was on the Region characteristic and then Customer group characteristic. The region North was chosen for further analysis, and both a detail and drilldown list were produced. The drilldown list shows an overview of profitability for each value of the nextlower level (customer group). The detail list shows the profitability for all of the north region, without a further breakdown by customer group.
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AC040
5-9
Options for Drilldown Reporting
Currency Translation
Other Reports Graphics Customer Group
Print
E-Mail
Attributes Street, City, Country
01 Retail 1,000,000 02 Wholesale 2,500,000 03 Investment1,500,000 04 Mail order 1,000,000
Microsoft Excel
Microsoft Word
Hierarchies
Display Master Data
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The drilldown reporting functions are separated into
functions that he or she requires.
three levels so that you can assign each user the
Level
1 contains the basic functions of drilldown reporting plus the ability to send reports via SAPmail. This level is designed for users who do not require the full functionality of drilldown reporting.
Level
2 contains the remaining drilldown functions. You can also display graphics and download reports in Microsoft Excel format.
All Functions
provides you with the complete range of drilldown functions including printing, saving report data, and defining exceptions. This level is designed for users who want all interactive drilldown functions plus the ability to print and change reports.
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AC040
5-10
Interactive Information System
Account 470000 rent
Actual Costs Plan Costs 100,000 100,000
Var.(abs.) Var.(%)
CO Documents 470000 Rent 60,000 cost center 470000 Rent 30,000 cost center 470000 Rent 10,000 cost center
FI Document Debit 470000 Rent Credit 113100 Bank
10,000 10,000-
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Each
individual movement is automatically summarized in totals records. This summarization takes place in the R/3 System by object/account, and enables faster evaluation of the data. You can analyze the totals record data with the information system. From the summary report, you can analyze the associated line items by calling up the line item report. You can also branch from a line item to the original documents that created it.
Displaying the
Original Document To display the original document of the application that sent the data to CO, click on the line item to select it, and choose the original document button or the menu path Extras > Original document. You can also select a line item simply by double-clicking on it. For example, if a document line originated with a posting to a cost center in Financial Accounting (FI), the system displays the FI document.
Displaying Accounting Documents
(line items only) Choosing the menu path Environment > Accounting documents displays a dialog box containing the documents in accounting that were created in connection with that line item. In the example above (primary posting to a cost center in FI), these would be the FI document, the CO document, and possibly other documents such as the FI-SL document or the consolidation document.
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AC040
5-11
ABAP List Viewer
Column set
Column selection Column name
Column name
Cost center
Costs
Cost element
Plant
Quantity
...
Unit
... ...
Save as layout Layout
Layout name
Default setting
1SAP
Primary cost posting
2SAP
Secondary costs: Activity
3SAP
Sec. costs: Val. alloc.
Layout:
/AC040
Name:
Activity allocation User-specific
CCtr
CElem
4220 4220 4220 4220 4230 4230 4230 4230 4230 4230 4230 4230
619000 619000 620000 620000 619000 619000 619000 620000 620000 625000 625000 625000
Total qty entered 819,083 105,500 1001,000 1476,111 105,500 77,747 1102,800 35,001 3,125 10,000 5,500 82,030
Unit h h h h h h h h h h h h
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The ABAP
list viewer (ALV) is particularly recommended for all types of list-based reports. An example of this are the line item reports.
In
the ALV report, you can choose between different standard display variants (layouts) for the line item display. The display variant controls how the line item information is displayed on the screen. If required, you can change the sequence of the fields, or select new fields from a field catalog, or remove ones already selected. You can save these new settings as your own layout, either userspecific or generally available.
Depending on
the width of a column, the R/3 System automatically displays the short text version or the long text version of the field name, using your logon language, if available.
Once
you have run a line item report, you have the following display options:
- Horizontal scrolling by column - Hide/show columns - Change order of columns - Sort list according to certain criteria - Totals for value columns - Subtotals for each object in a row - Filter function - Display original document
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AC040
5-12
Reporting Tools: Summary
At the conclusion of this unit, you should be able to: z Name the different reporting tools available in Controlling z Explain the purpose and features of the different reporting tools
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AC040
5-13
Exercises Unit: Reporting Tools Topic: Overview of Reporting
•
Through the use of different reports, participants learn about the similarities and differences between FI and CO regarding report contents and the level of detail of the reported data.
Although FI and CO are both used for internal accounting, these two applications provide very different levels of detail with respect to the focus of reporting and the drilldown capabilities. While FI focuses on the revenues and expenses at a high level (company code and business area), CO provides detailed data on costs and revenues for individual cost objects (cost centers, orders, profit centers, and so on). You will use the reports of the German subsidiary of the CO controlling area Europe (operating concern IDES Worldwide) in the General Ledger (FI), Profitability Analysis (CO), and Cost Center Accounting (CO) to examine the reporting focus in each of these application areas.
1-1
Generate a balance sheet/profit and loss statement in the general ledger for the German IDES subsidiary. 1-1-1 Execute the actual/actual comparison report Balance Sheet/Profit and Loss Statement for company code 1000. Using the SAP minimal variant and the financial statement version INT, generate a report for the current fiscal year in English that enables a comparison with the previous fiscal year. 1-1-2 Concentrate on the sales revenue account (800000) and the expense account for direct labor costs (420000). How detailed is the revenue and expense information in this report? (You can find the accounts quickly with Edit Æ Find). _________________________________________________________ _________________________________________________________ _________________________________________________________
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AC040
5-14
1-2
Execute a report in costing-based profitability analysis for the operating concern IDES Worldwide (IDEA). To see the results for different market segments, execute contribution margin report AC040 for the current fiscal year with plan version 100. 1-2-1 Drill down to the results for the Hamburg plant (1000). What is the gross revenue for this view? _________________________________________________________ 1-2-2 Drill down in this report for plant 1000 to division 00 (cross-division sales), product P-100 and customer 1320. What is the actual gross revenue for this view? _________________________________________________________ 1-2-3 From the main report, drill down to investigate the results for product P100 (pump). What is the actual gross revenue for this view? _________________________________________________________
1-3
In cost accounting, execute a report for the controlling area Europe (1000). Execute the Cost Centers: Actual/Plan/Variance report for periods 1 to 12 of the current fiscal year and plan version 0. Use cost center 4230. How detailed is the cost information in this report? _________________________________________________________ _________________________________________________________ When you leave a cost center report, if the system asks whether you want to exit the report and generate an extract, choose Yes to leave the report but don’t select Generate extract.
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AC040
5-15
Unit: Reporting Tools Topic: Integration
•
The participants trace a cost posting in CO back to the original FI transaction that caused the posting, which helps them become familiar with the system’s integration.
When expenses are posted in a component outside of CO, and if the accounts for these expenses have been defined in CO as cost elements and a Controlling object was specified, cost postings are generated in CO. The costs are assigned to the specified objects (such as a cost center or internal order).
2-1
Review the cost postings on service cost center 4230 and examine the posting documents that concern cost element 420000 (direct labor costs). 2-1-1 In Cost Center Accounting, execute a report for the controlling area CO Europe (1000). Execute the Cost Centers: Actual/Plan/Variance report for periods 1 to 12 of the current fiscal year and plan version 0. Use cost center 4230. 2-1-2 Drill down on cost element 420000 (direct labor costs) to the actual line items. Drill down on a line item to the document (source document) that captured the business transaction. Look at the other accounting documents connected with this business transaction.
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AC040
5-16
Solutions Unit: Reporting Tools Topic: Overview of Reporting
•
Through the use of different reports, participants learn about the similarities and differences between FI and CO regarding report contents and the level of detail of the reported data.
Although FI and CO are both used for internal accounting, these two applications provide very different levels of detail with respect to the focus of reporting and the drilldown capabilities. While FI focuses on the revenues and expenses at a high level (company code and business area), CO provides detailed data on costs and revenues for individual cost objects (cost centers, orders, profit centers, and so on). You will use the reports of the German subsidiary of the CO controlling area Europe (operating concern IDES Worldwide) in the General Ledger (FI), Profitability Analysis (CO), and Cost Center Accounting (CO) to examine the reporting focus in each of these application areas.
1-1
Generate a balance sheet/profit and loss statement in the general ledger for the German IDES subsidiary. 1-1-1 Execute the Balance Sheet/Profit and Loss Statement report for company code 1000. Accounting → Financial Accounting → General Ledger → Information System → General Ledger Reports → Balance Sheet/Profit and Loss Statement/Cash Flow → General → Actual/Actual Comparisons → SAP Minimal Variant Enter 1000 in the company code field. Enter INT in the Financial statement version field. Enter EN in the Language field. Enter the current fiscal year in the Reporting year field. Enter the previous fiscal year in the Comparison year field. Choose Execute.
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AC040
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1-1-2 Concentrate on the sales revenue account (800000) and the expense account for direct labor costs (420000). Choose Edit → Find. Enter 800000 as the search term and press OK. Position the cursor on a row in the report and click the Details icon. Check the displayed information. After checking the information, choose Edit → Find again. Enter 420000 as the search term and press OK. Position the cursor on a row in the report and click the Details icon. Check the displayed information.
In this report, the revenue and expense information is output at the company code/business area/account level. 1-2
Execute a report in profitability analysis for the operating concern IDES Worldwide (IDEA). 1-2-1 Drill down to the results for the Hamburg plant (1000). Accounting → Controlling → Profitability Analysis → Information System → Execute Report Select the report AC040 (double-click). In the dialog box Set Operating Concern, enter IDEA in the operating concern field. Choose costing-based and confirm with Continue (if the system asks you whether costing-based is the correct type of profitability analysis, choose yes.) Enter the current fiscal year and plan version 100. Choose Execute. Choose Plant in the navigation area. Check whether plant 1000 (Hamburg) is displayed. If necessary, you can scroll with the navigation arrows or use the magnifying glass to see which plants are available.
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AC040
5-18
1-2-2 Drill down on plant 1000 to division 00, product P-100, and customer 1320. Click on Division. Check whether division 00 (cross-division) is displayed. Click on Product. Check whether product P-100 is displayed. Click on Customer. Check whether customer 1320 is displayed.
1-2-3 From the main report, drill down to display the results for product P-100 (pump). Choose Back (green arrow) in the navigation area repeatedly until you return to the initial report. Click on Product and select product P-100. 1-3
Execute a report in Cost Center Accounting. Accounting → Controlling → Cost Center Accounting → Information System → Reports for Cost Center Accounting → Plan/Actual Comparisons → Cost Centers: Actual/Plan/Variance Enter 1000 in the Controlling area field. Enter the current fiscal year in the Fiscal year field. Enter 1 in the From period field. Enter 12 in the To period field. Enter 0 in the Plan version field. Enter cost center 4230 in the first Or Value(s) field. Execute the report.
In this report, cost information is displayed at the cost center and cost element level.
When you leave a cost center report, if the system asks whether you want to exit the report and generate an extract, choose Yes to leave the report but don’t select Generate extract.
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AC040
5-19
Unit: Reporting Tools Topic: Integration
•
The participants trace a cost posting in CO back to the original FI transaction that caused the posting, which helps them become familiar with the system’s integration.
When expenses are posted in a component outside of CO, and if the accounts for these expenses have been defined in CO as cost elements and a Controlling object was specified, cost postings are generated in CO. The costs are assigned to the specified objects (such as a cost center or internal order).
2-1
Review the cost postings on service cost center 4230 and examine the posting documents that concern cost element 420000 (direct labor costs).
2-1-1 Execute a report in Cost Center Accounting. Accounting → Controlling → Cost Center Accounting → Information System → Reports for Cost Center Accounting → Plan/Actual Comparisons → Cost Centers: Actual/Plan/Variance Enter 1000 in the Controlling area field. Enter the current fiscal year in the Fiscal year field. Enter 1 in the From period field. Enter 12 in the To period field. Enter 0 in the Plan version field. Enter cost center 4230 in the first Or Value(s) field. Execute the report.
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AC040
5-20
2-1-2 Drill down on cost element 420000 (direct labor costs) to the actual line items. Double-click on the report row for cost element 420000. Double-click on the Cost Centers: Actual Line Items report. Choose the Document button to see the original FI document (accounting document). Return to the screen Display Actual Cost Line Items for Cost Centers. Position the cursor on the line item and choose Environment Æ Accounting documents. The system displays a list of the accounting documents generated by this posting. Examine the accounting document and the profit center document. In this example, the source document is the same as the accounting document.
Exit the report and return to the application menu.
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AC040
5-21
Planning and Planning Integration: Overview
z Introduction to Planning
z Planning in Cost Center Accounting using different Controlling methods z Integrated Planning Cycle z Planning With ABC
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AC040
6-1
Planning and Plan Integration: Unit Objectives
At the conclusion of this unit, you will be able to: z Differentiate between the most important cost accounting methods in R/3
z Name and explain the application components and their tasks that are relevant to integrated planning z Explain the use of planning in different industries z Name the additional functions that are related to Activity-Based Costing z Use some basic planning functions.
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© SAP AG
AC040
6-2
Overview
$
HR
t
+ ABC
Reporting Tools
MM
FI
SD AA
DM DM
Postings to CO from Other Components
Planning and Integrated Planning
CO 1
9
12
$
Transaction-Based Postings in CO
OM PC Profit Representing Your Business in CO
CO
AC040
1 12 OM PC Profit FI CO
INT EXT OM PC Profit
Period-End Postings in CO
FI MM HR AA SD
Overview of Controlling
“Where now?" Navigation
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© SAP AG
AC040 AC040
Summary
ASAP: Introduction
Introduction
AC040
6-3
Planning and Plan Integration: Enterprise Scenario
z
z
z
You now focus on the planning function. Your enterprise wants to plan the costs and revenues for the coming year. You are responsible for checking these planned values, and ensuring that uniform and realistic values are obtained, with the help of integrated planning. Planning starts with the forecast of sales figures for different products and services. Planning then concentrates on costs that are incurred by the production/purchasing for these products. Next, the planned revenues are compared with the costs to see if each contribution margin is acceptable.
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AC040
6-4
Introduction to Planning
At the conclusion of this topic, you will be able to: z Describe the extent of the current planning activities within your organization.
z Explain how different plan versions can be used.
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Virtually every business
organization plans to some extent for future business operations. The extent and way of planning, however, can vary greatly from one enterprise to another.
The best
reason for planning is that it provides a baseline measurement against which actual operating results can be matched. This improves the analysis and control aspects of the business operations to achieve the desired results.
Plan figures
can be part of an enterprise’s goals, or may just apply as a type of general guideline. The purpose depends on the enterprise culture and policies.
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AC040
6-5
Planning: Goals
Planning of future business activities, taking changing business circumstances into account
Forecasting for setting up binding standards for a fiscal year, for the following: z Valuation of internal business activities
z Monitoring efficiency using “plan / actual” & “target / actual” variance analyses. SAP AG 2001
Planning is
used to set organizational goals. The comparison of actual operating results with the plan can identify variances that serve as signals to take corrective measures in the business operations.
There are several
basic goals in planning:
y Plan the structure of the company’s future operations for particular periods
y Create benchmarks for monitoring the business transactions within a fiscal year
y Monitor efficiency at the end of the posting periods using plan/actual and target/actual comparisons
To achieve
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these goals, the R/3 System offers a wide variety of options from which to choose.
AC040
6-6
Versions
z General version definition Æ Settings in the Operating Concern
Æ Settings for Profit Center Accounting Æ Settings in the Controlling Area Æ
Settings for fiscal year
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A
“version” can be thought of as a unique view of planned costs and revenues, given a particular set of assumptions. In the planning process, many different versions can be created, and different planned values created for each version. Each version is independent of all others.
The SAP
R/3 System automatically creates version 000 when you create a controlling area. The actual values created when entering primary costs and allocating costs internally are posted in this version. This version must be used for plan/actual cost comparisons. Version 000 is the version used for analyzing actual data.
Planning always
take place within a plan version. A version is cross-application. This helps ensure that the integrated use of a particular version produces consistent results across applications (for example, planning integration between Cost Center Accounting and Profit Center Accounting).
A
given version can have certain settings that apply individually to each controlling area, and to each fiscal year, such as whether copying the version is allowed, or if planned data for the version is locked (cannot be changed). There are also further version settings that affect planning in different areas.
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AC040
6-7
Copy Plan and Actual Data
Plan data
Actual data
Plan 2000 Version 1
Actual 1999
Copy: Cost Centers Profitability Segments . .
Plan data Plan 2001 Version 1
Revaluation
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If
you want to reuse large parts of your cost and revenue planning from the previous year for your current fiscal year, or if you want to transfer plan values within a fiscal year to a different period, or generate alternate versions, you can use the tool Copy planning.
The copy
planning function can also be used to copy actual data from cost center accounting to be used as the base for future planning data.
You
can copy as much or a little data as required. For example, you may limit the selection of data to a particular cost center, or you can select all cost centers.
Revaluation
allows you to increase or decrease the planning results on a percentage basis. The combination of copy planning and revaluation allows you to create multiple planning versions. This may be useful after copying the plan data from the previous year or for producing best-case and worst-case scenarios within a year.
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AC040
6-8
Planning Layouts
Activity Type/Activity Price Planning
Year Periods Cost Center
2001 1 to 12 4100 Technical Services
Activity type
Release activity 10000 5000
MAINT Repairs
Unit H H
Price 35.00 60.00
Allocation PPI cost element 3 612000 3 615000
SAP AG 2001
Planning layouts are used
for defining the planning screen. You define the titles, key columns and value columns according to your business requirements for all planning areas. In Cost Center Accounting, for example, has the following planning areas: y Cost elements/activity input y Activity types/prices
y Statistical key figures
The R/3
System provides standard planning layouts for almost every type of planning area. You can copy these standard planning layouts and adapt them as required, or create new ones.
You
can create your own planning layouts for each planning area that displays other key columns. The key columns show the objects that require planning. You can define more than one key column, and can, for example, create a planning layout with cost center and activity type as the key columns. In this case, value columns are available for planning values for all combinations of cost centers/activity type.
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AC040
6-9
Organization of the Planning Views
Planning areas
Cost elements/ Activity input
Planning layout 1-101 CElems Activity-indep./dep. 1-201 Activity input Activity-indep./dep.
Planner profile
SAPALL CO Planning: All planning areas
Z0011 Own layout for activity input planning Activity types/prices
1-201 Activity types
SAPEASY CO-OM: Simple layouts
A0014 Own layout for Activity Type Planning Statistical Key figures
1-201 Stat. key fig. S0010 Own layout for Stat. key figures
P0001 Own profile CO-OM
SAP AG 2001
You
use entry displays to enter CO planning data. You can customize these displays as reqiured. These displays are also called planning layouts.
There are three planning areas in
Cost Center Accounting:
y Cost element/activity input planning y Activity types/prices
y Statistical key figures
A
planning layout is created for each planning area. You use the layout to define the key columns (these are characteristics for which you enter planning values, for example, cost center or cost element) and assigned to the value columns in which you enter the planning data. SAP provides numerous predefined standard layouts. Layout 1-101 is for activity-independent and activitydependent cost element planning for example.
You
can control the planning process with the help of planner profiles. In a planner profile you can assign as many planning layouts as required to each planning area. A planning area can therefore contain more than one planning layout. You can also group the planning layouts together by assigning them to planner profiles. During the planning phase, you can switch between the planning layouts that belong to a certain planning area of a planner profile. In this way, you can switch between layouts 1-101 and 1-102 in the SAPALL profile.
The R/3
System contains standard planner profiles and planning layouts that cover numerous possible planning situations. You can use the SAPALL planner profile to plan three planning areas with more than one assigned SAP standard layout. SAP has designed the SAPEASY planner profile for more simple planning requirements. You can also create your own.
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AC040
6-10
Planning with Different Cost Accounting Methods
At the conclusion of this topic, you will be able to: z Describe the most important cost accounting methods in the R/3 System z Explain the difference between these cost accounting methods z Use some of the basic planning functions using these cost accounting methods
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AC040
6-11
Cost Accounting Methods z Cost allocations Only cost values are planned Enables target/actual comparisons
z Internal activity allocations
The activity types of a Cost Center must be defined Activity type quantities are planned Activity type quantities can be scheduled and reconciled You can manually enter the price, or use the system to calculate it
z Fixed and variable costs
Based on activity-dependent and activity-independent cost planning Enables fixed and variable components in the activity type price Enables Target / Actual comparisons Marginal Costing (cost per additional unit) SAP AG 2001
Different
cost accounting methods have been implemented in CO. These methods have different levels of detail and most of the analysis options, therefore requiring more time for implementation and maintenance. The selection of each method depends on the amount of detail that you require.
The selected
method does not have to be valid for the whole enterprise. If planning detail and accuracy do not have to be so high for certain parts of the enterprise, then you can use a more simple method. It is recommended that you select a more complex method for areas in the enterprise that require comprehensive cost accounting functions.
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AC040
6-12
Planning in Cost Center Accounting At the conclusion of this unit, you should be able to: z Explain the planning of statistical key figures z Describe the targets of activity type planning z Explain the typical sequence of tasks in cost center
planning
z Describe simple and complex planning options
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AC040
6-13
Planning Statistical Key Figures
Cost Center Administration
36 Employees
1200 Telephone units
SAP AG 2001 1999
Planning statistical
key figures enables you to
y Calculate the ratios in Cost Center Accounting (such as costs per employee)
y Create receiver bases (allocation factors) for allocations such as assessment or distribution.
There are two
y Fixed value
different kinds of statistical key figure:
y Totals value
If
you plan a statistical key figure that is a fixed value (for example, employee), you enter the number of employees that are assigned to a cost center. The system then shows the mean value for all planned periods in the overview screen. The period data screen shows you the plan quantity for each period.
If
you plan a statistical key figure that is a total value (for example, telephone units), the quantity that you entered is distributed to the periods according to the assigned distribution key.
You
can, however, plan statistical key figures directly or according to the activity types for a cost center. SAP provides you with standard layout 1-301 for activity-independent planning of statistical key figures, and 1-302 for activity-dependent planning of statistical key figures. You can access both these layouts via the SAPALL standard profile.
You
can also transfer statistical key figures from the Logistics Information System (LIS). See also the following slide: "Transferring Planning Values to Cost Centers" under "Integrated Planning Cycle".
© SAP AG
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Primary Cost Planning
Cost Center: Production Primary cost element
Fixed costs
420000 Direct labor costs
300,000
421000 Indirect labor costs
100,000
430000
Wages/salaries
130,000
452000
Machines & equipment
400,000
471000 Machine rental
50,000
481000 Depreciation
100,000
490000
...
...
SAP AG 2001
You
plan activity-independent primary costs structured by cost element on the cost centers where you later assign actual data. Most cost elements are normally planned this way (material costs, costs for raw materials and operating materials for example).
To
plan activity-independent primary costs, proceed as follows:
y Choose a standard profile such as SAP101 or SAPALL. y Choose Planning -> CElems/ActyInputs -> Change
© SAP AG
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Cost Allocation Methods for Planning
Costs
Cost Center
Overheads Distribution Assessment
Cost center 1
Cost center 2
Cost center 3
SAP AG 2001
In
distributions and assessments, costs that were planned on a cost center by means of user-defined keys (such as percentages, amounts or statistical key figures) are allocated.
The advantage
of these methods is that they are simple: you only need to define the keys and the sender/receiver relationships once.
You
can, for example, assess the costs for the cafeteria using the number of employees per cost center, or distribute the telephone costs according to the telephone units or telephones per cost center.
For
more information, see the unit on period-end closing postings in CO.
© SAP AG
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Pure Cost Allocations
Cost center
z z
Simplest planning method Analysis: Plan/actual or actual/actual comparison
Cost center Proftblty seg. Process
Order, project
SAP AG 2001
Cost
accounting methods that are based on pure cost allocations do not necessarily require planning. However, there are many types of cost allocation (e.g. distribution or assessment), which are only possible within overhead cost controlling. For this reason, this cost accounting method is only recommended for relatively simple cost accounting systems that do not require special integration with other components such as SD or PP.
If
you do not enter any planning data then your options for a later analysis using actual/actual comparisons with past periods will be reduced.
Plan
costs can be entered manually or transferred from feeder systems such as Human Resources (HR), Asset Management (AM), and the Logistics Information System (LIS).
For
cost allocation the system provides different functions such as distributions, assessments and overheads.
© SAP AG
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Activity Type Planning
Cost Center: Production Activity type "machine hours" Plan qty: Capacity: Price:
10,000 hrs 12,000 hrs Fixed _____Variable____
Cost element: 620,000
Activity type "labor hours" Plan qty: 800 hrs Capacity: 1,000 hrs Price: Fixed _____Variable____ Cost element: 625,000
... SAP AG 2001
Activity types can
be used to measure cost center performance. They describe the activity output (output quantity) of a cost center and are used for calculating the operating rate and the target costs.
Activity types are allocated using a
master record.
secondary cost element, which is stored in the activity type
You
either enter the price for each cost center/activity type manually, or calculate it using automatic price calculation. y You can set manual activity prices for your cost center/activity type combination if the activity price is fixed within your company and unaffected by any internal exchange of activities.
y In the automatic calculation of prices, all primary and secondary costs are contained in the price. These were planned either activity-dependent or activity-independent for each cost center. y If several activity types are planned on a cost center, the activity-independent plan costs are broken down (split) onto these activity types for activity price calculation. You can accomplish this by entering equivalence numbers along with each planned activity type, or with plan cost splitting. y The unit price for an activity type is calculated by dividing planned costs for an activity by the planned quantity of activity type units. Alternatively, the capacity of a cost center to produce a given activity type can be used in calculating the fixed portion of the activity price.
Since the activity quantity is
valuated with this price, a combined quantity and value flow is the result of an activity allocation.
For
activity type planning, SAP provides the Standard-Layout 1-201 in R/3, which assigned to the standard planner profile SAPALL.
© SAP AG
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Planning Primary Costs that are ActivityDependent Cost Center: Production Activity type Machine hours Primary cost elements
1200 hrs Fixed costs
Variable costs
420000 Direct labor costs
600,000
400,000
421000 Indirect labor costs
200,000
130,000
453000 Plant maintenance costs
100,000
100,000
481000 Depreciation (estimated)
300,000
270,000
Activity type Labor hours 420000
800 hrs
...
SAP AG 2001
When
you plan primary costs that are activity-dependent, you plan primary costs that depend on certain activity types provided by the cost center. You thus specify that if the activity type is no longer provided, that these costs also no longer apply.
Procedure:
Once activity type planning is complete, you can plan the costs taking into account these activity (divided into fixed and variable costs if required). Variable costs are costs that occur in relation to the planned activity quantity. These costs can be planned in addition to costs that are not activity-dependent. This means that the price can contain two types of fixed costs: y Plan costs (activity-independent) for the cost center
y Fixed plan costs (activity-dependent) for the activity type
SAP
provides standard layout 1-101 (contained in SAP profile SAPALL) for the planning of primary costs that are activity-dependent.
© SAP AG
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Planning Secondary Costs
Receiver Cost Center: Production Sender cctr 4100
Sender activity type Repair hours
Input quantity
Plan costs
100 hrs
8000
Sender Cost Center: Plant Maintenance 4100 Activity type
Plan qty
Rep. hrs
100 hrs
Scheduled qty 100 hrs
Fixed price Variable price 30
50
80 x 100 hrs = 8000 SAP AG 2001
In
addition to the primary costs, a cost center often incurs secondary costs, since it has to use services (activity input) from other cost centers. You can plan this kind of activity input as either activity-independent or dependent.
You
plan activity input as activity-independent if you use services such as plant maintenance hours, regardless of the activity of the receiver cost center. The consumption of planned activity input is, in this case, regarded as fixed. Activity input is planned as activity-dependent if the consumption of this activity depends on the output of an activity on the receiver cost center. The consumption can be fixed or variable for the activity output quantity.
You
need to plan secondary costs for your cost center to enable a comparison of plan and actual data at regular intervals. In an actual posting, you are the receiver of internal activity allocations, since you receive the services from other cost centers.
A
cost center that plans the receipt of secondary costs from internal activity allocations must always specify a sender cost center and the quantity of the recieved activity for this business transaction.
To calculate
the planned secondary costs, the R/3 System multiplies the price of the activity type from the sender cost center with the activity quantity that is consumed by the receiver cost center. Planned secondary costs (activity-independent) are always fixed costs for a receiver cost center.
You
can use standard layout 1-102 in the SAPALL profile for this business transaction.
© SAP AG
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Cost Allocations Using Activity Types z Cost Center
z
h
z z Cost Center
h
Proftblty segment
Quantity allocation (activity types) Valuation with prices (plan or actual price) Fixed and variable costs/ activity type Target/actual comparison & extended variance analysis
Process
Order, project Production orders SAP AG 2001
Cost
accounting methods that allocate activity-based costs do not necessarily need planning, but the activity type that is provided must be assigned to the cost center and a price must be stored. Since you can allocate activity allocations (even though not every available tool can be used) to all other account assignment objects in CO, these types of cost accounting methods are also recommended for more complex cost accounting systems as well as for the integration with other components, such as SD and PP.
If
, however, you allocate costs using activity types, the planning function is recommended. In addition to planning costs, you can also plan the output quantities of the activity types. This means that you can also, in this case, calculate the costs per unit of the activity type provided using price calculation. These can be stored as the price in cost center planning.
You
can overwrite manually stored prices if required, or (for political reasons) these can be retained to keep a particular type of activity expensive, for example.
Activity input
planning values shows the requirement for "scheduled activity quantity" to the sender of the activity. The cost center manager can then adapt the activity output of the cost center to adapt to the requirement. This can help avoid idle capacity. This visibility facilitates plan reconciliation between activity quantities scheduled to be consumed and those planned to be produced by a cost center.
The calculated
prices are used immediately for all participant senders and receivers to display the new plan debits or plan credits. The result of the price calculation should be prices which bring the cost center balance to zero in the planning figures. This is a "fair allocation price for the activity type".
You
can use output quantities to determine an operating rate and cacluate target costs. This provides you with plan/actual comparisons and target/actual comparisons for analysis purposes.
© SAP AG
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Example of Price Calculation
Cost center 4210
Cost per hour:
Activity type Production hrs Planned activity 100 hrs Activity-dependent Fixed 2000 Variable 3000 Equivalence number 1 _____________________________
+ 7000
Activity type Planned activity Activity-dependent Fixed Variable
90 fixed 30 variable
Machine hrs 100 hrs 5000 8000
+ 14000 at
190 fixed 80 variable
Equivalence number 2 _____________________________ Activity-dependent 21000
SAP AG 2001
Equivalence
numbers are one way of assigning planned costs (activity-independent) to the activity types (splitting).
Example:
A cost center plans to produce two activity types: production hours (PHR) and machine hours (MHR). The activity types were selected for cost element planning (activity-dependent). In addition, activity-indpendent costs of 21,000.00 were planned, that need to be distributed to the different activity types using equivalence numbers. y PHR Equivalence no. = 1:
y PHR Equivalence no. = 2:
The split
© SAP AG
21,000 x 1/3 = 7,000.00 21,000 x 2/3 = 14,000.00
costs are a component of the fixed part of the price of each activity type.
AC040
6-22
Examples of Typical Planning Steps for Cost Centers
9 Planning statistical key figures 9 Assigning activity types to cost centers 9 Planning the activity inputs 9 Reconciliation (scheduled activity
(activity-dependent/activity-independent)
9 Planning the primary costs
quantity/plan activity quantity)
9 Planning additional secondary costs 9 Automatic price calculation
(activity-dependent/activity-independent)
SAP AG 2001
There is
no prescribed sequence in which the steps involved in cost center planning must be performed. However, SAP does recommend that you follow a few general rules to ensure a logical sequence that meets your requirements. You may nevertheless find that you need to adjust this sequence in your particular situation.
The first
step is to plan statistical key figures. Statistical key figures are frequently used as tracing factors in distribution and assessment.
Activity type
planning is usually the next step, because it must be known which activities can be performed by which cost centers.
Using activity input
planning, the cost center managers plan how much activity they want to use. This can be seen on the sending cost centers as the scheduled activity quantity.
The cost
center managers then plan the activity quantities that they want to provide. These quantities should be based on the scheduled activity quantities. This can be done automatically using plan reconciliation, which adjusts the planned activity quantity for a cost center to the activity quantity scheduled for the receiver cost centers.
The next
logical step is planning the primary costs and the additional secondary costs. These costs can be planned manually as either activity-independent or activity-dependent costs. You can subdivide the activity-dependent costs into fixed and variable costs.
Secondary cost planning can
include assessment and indirect activity allocation.
Activity price calculation is the final stage
of the planning process. The R/3 System calculates the prices for all combinations of cost centers and activity types iteratively. The activity prices are then used to valuate the planned activity exchange.
© SAP AG
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Assigning Planning Methods to Controlling Methods (1)
Simple planning options for overhead cost controlling
Additional planning options in scenarios with integration, for example, to SD and PP
y Only cost planning
y Cost allocation using distribution and assessment
y Æ Only possible to compare actual/actual costs and plan/actual costs y Overhead rates
y Activity types with manually entered prices y Activity input planning
y plan reconciliation (of activity quantities) y Æ Activity price calculation
y Æ Actual/actual and plan/actual reports of costs, activity output quantities and scheduled quantities SAP AG 2001
In
simple scenarios planning is optional and no activity types are necessary. Only costs are planned. Plan cost allocations can be accomplished with distributions and assessments.
If
you also want to use Cost Object Controlling, you need to be able to allocate the overhead costs to production orders and other cost objects.
The advantage
of the activity type allocation is that it combines both quantity and value flows. Required activity quantities are specified in routings, which provides detailed cost controlling information in product cost planning and on cost objects.
Activity types can
also be consumed by cost centers and internal orders. When activity input is planned, the quantity of activities other controlling objects have planned to consume shows up on the sender cost center as the scheduled quantity. You can use the plan reconciliation function to adjust the planned activity quantities to the scheduled activity quantities.
After
cost and activity planning is complete, the system can calculate activity prices by dividing the plan costs by the planned activity output quantities. If more than one activity is produced by a cost center, you have to split the costs to the different activity types first, using equivalence numbers or the splitting tool.
© SAP AG
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Assigning Planning Methods to Controlling Methods (2)
More detailed planning options
y Planning activity-dependent costs (fixed/variable costs)
y Planning activity-dependent input quantities (fixed/variable quantities)
y Æ Price calculation with fixed and variable price portions y Æ Determination of the operating rate of cost centers y Æ Target/actual comparisons
SAP AG 2001
More detailed planning methods
operating rates.
provide far more information on costs, activity outputs and
In
order to address the operation level of a cost center in the analysis of actual costs, the planning process should classify planned costs and activity input as either activity-independent or activitydependent. This will give the system the information necessary to calculate target costs. A change in the operating level for an activity type will result in a changed value for target costs. Target costs = planned fixed costs + planned variable costs x operating rate. The operating rate represents the actual activity quantity of an activity type in a period divided by the planned activity quantity of an activity type (actual activity quantity / planned activity quantity).
The target
costs are costs that are expected for a certain operating rate. They form the basis of the target/actual cost comparison, in addition to the plan/actual cost comparison. Plan cost values are statistical values that do not take into account the changes to operating rates. Target costs are dynamic values that continuously change according to the activity types. As a result, these values provide much more information regarding the calculation of the operating rate by the cost center.
These
planning methods can be used for flexible marginal costing.
© SAP AG
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Integrated Planning Cycle
At the conclusion of this topic, you will be able to: z Identify the application components that are involved in the Integrated Planning Cycle.
z Explain the impact of each of the application components involved.
z Explain how the Integrated Planning Cycle is used in the Manufacturing and Service industries.
SAP AG 2001
© SAP AG
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Integrated Corporate Planning Strategic Procedure LIS (SIS)
planned requirements
Sales Planning
Profit Planning
Sales Template
SOP LTP
Activity input quantity Process Input quantity
Routing
Bill of material
Cost center/ Activity type
Cost of goods manufactured / sold Material Cost Estimate
Activity price Process price
Business Process SAP AG 2001
A
company can use the Sales Information System (SIS), a component of the Logistics Information System (LIS), to plan sales quantities at product or product group level for the following year. Similarly, sales quantity planning can be accomplished in profitability analysis (CO-PA). The sales plans from SIS and CO-PA can be compared with one another so that a single forecast can be transfered to Sales and Operations Planning (SOP). There, a capacity-based comparison of plan quantities with production resources takes place. If the plan cannot be met, additional resources must be obtained or the sales plan changed.
The activity requirements can
then be created, either here or using long term requirements planning (LTP), and transferred as scheduled activities to cost center planning.
In
cost center planning, the plan activity quantities are created on the basis of scheduled quantities. Cost planning is performed for cost centers and internal orders, as well as additional activity planning for overhead cost controlling. Planned costs from the HR and Asset Management components can be transferred to cost center planning. Plan activity prices are then calculated.
The calculated
plan activity prices go to Product Cost Planning, which estimates the production costs of the planned products with the use of bills of material and routings (quantity structures).
The cost
of goods manufactured, that were calculated on the basis of the sales plan are then transferred to Profitability Analysis (CO-PA). These costs are used, alongside the forecasted revenues, to create a profit plan. You can use the results of this plan to make adjustments to the original sales plan, which then execute the complete integrated planning process again. This cycle can be repeated until all aspects of the integration plan are completed.
© SAP AG
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Planning Integration - Sales Planning Logistics Information System Sales Quantity
Sales Planning/ Forecasts Sales Quantity
SAP AG 2001
Profitability Analysis
planning enables you to plan sales, revenue and profitability data for any profitability segments. Thus, the complete planning process for an enterprise can reflect its business requirements.
Usually sales
and profit planning is an integrated process comprising different roles in Controlling, such as Sales Manager, Regional Manager and Sales Executive. There are often various approaches, for example top-down, centralized planning and bottom-up, decentralized planning.
The planning tools
for Profitability Analysis provide everyone involved in the planning process with a uniform, easily understandable, and modern planning interface. This enables smooth co-operation between ’powerusers’, for example, the central planner who monitors and modulates the planning process and occasional users who only confirm planned values once in a while.
© SAP AG
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CO- PA: Planning
Sales Organization
Time frame from … to ... Version
Industry Media Software Pharma
Product
Quantity 1000 5000 3000
Revenue 3000 4000 1000
COGS 2000 3000 800
SAP AG 2001
As
the contents and level of detail of individual plans can vary according to role and area of responsibility, the planning framework enables you to structure your plan by planning level and content, which you can allocate to the individual responsible. The planning hierarchy is displayed in a tree structure. You can execute nearly all planning functions directly from the planning framework - modeling the planning process, monitoring planning tasks and manual entry of plan data.
To support the individual
steps of the planning process, the planning tools for Profitability Analysis provide numerous plannning functions and planning aids that you can use to create and change any plan data. These include both automatic functions that create and change data for the whole plan, and the possibility to enter plan data manually. Alternatively, you can enter plan data decentrally in Microsoft Excel and then reload it to the R/3 System.
© SAP AG
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CO-PA: Top-Down Distribution Plan Values Product Grp Pumps
Distribution Value
Revenues 3000
Reference Data Product Product Grp P1 Pumps P2 Pumps
Sales Quantity 1999 100 200
Result: Distribution Values Product P1 P2
Product Grp Pumps Pumps
Revenues 1000 + 1/3*3000 2000 + 2/3*3000
Operating Profit
SAP AG 2001
In
top-down distribution, data planned at a level in CO-PA is distributed to other levels. The distribution occurs on the basis of reference data, which can be planning data or actual data from CO-PA.
One
example of this is planning values at the product group level and then distributing these values to the individual products in that group. Another example might be planning values at the individual product levels, and then distributing those values to the plants where the products are sold.
Plan
values can be distributed on the basis of reference data by period or across periods. If periodindependent reference data is used as the basis for distribution, the distribution percentages are brought in line across the periods for the receivers.
When
performing a top-down distribution, it is necessary to specify the fields in the reference data whose values should be used as the distribution basis.
In
the above example, revenue for the product group is distributed to the individual products belonging to this group. The values of the value field "Sales Quantity" serve as reference data. As a distribution base, the value 100 is taken for product P1 and 200 for product P2.
© SAP AG
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Integrated Planning - Planning in PP Logistics Information System
Sales Planning/ Forecasts
Sales Quantity
Sales Sales Quantity
Production Production - PP SOP SOP, LTP
SAP AG 2001
You
can transfer a sales quantity plan created in CO-PA to Sales and Operations Planning (SOP). You can transfer the sales quantity either for individual products or cumulatively at the product group level. You can select any market segment (for example all products from one division) and time frame (reporting period) for transfer.
You
can transfer data for one plant, or for several plants. If you do not plan at plant level in CO-PA, the planned quantities are distributed to the plants. If necessary, translation takes place between different units of measure and period types during the transfer.
In
the work centers, the activity quantities are calculated using the activity types and the associated formulas. The activity requirement quantities calculated in long term planning are taken into account in thereconciliation of the activity requirement with the cost centers’ range of services.
© SAP AG
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Planning Integration – Transferring Activity Requirements to Cost Center Accounting Logistics Information System Sales Quantity
Sales Planning/ Forecasts Sales Quantity
Production - PP SOP, LTP Activity Requirements
Cost Centers
SAP AG 2001
You
can transfer the values calculated for the activity requirement during long term planning to Cost Center Accounting as planned figures.
The cost
center records the transferred activity requirements as scheduled activity quantities for the production sector (for example, substituted by reconciliation objects from SOP planning).
© SAP AG
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Integrated Planning: Cost Center Planning Logistics Information System
Sales Planning/ Forecasts
Sales Quantity
Sales Quantity
Production - PP SOP, LTP Activity Requirements
Cost Centers Human Asset Cost Planning SAP AG 2001
Activity prices
$
Plan-Integrated Orders/WBS
Using the
scheduled activity quantity, the output quantities of activity types for cost centers can be planned. This can be done automatically using a reconciliation run or manually by the cost center manager.
After
this, the costs are planned. The cost center manager does not plan all the costs manually. Many costs can be taken from the plans in other modules, for example: y Human Resources Management (HR) y Asset Accounting (FI-AA) y Plan-integrated orders
y Plan-integrated WBS elements (PS)
Once
all this data has been transferred, the cost center manager plans the remaining costs manually. Plan prices are calculated last.
© SAP AG
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Transferring Planned Values for Cost Centers
Activity Requirements
Cost Center
Production Planning HR
PL AN NI NG
PP
Personnel Costs
Depreciation/Interest
Assets
CO ST
AA
CE NT
ER
Personnel
Statistical Key Figures Logistics Information System (LIS) SAP AG 2001
In
more detail:
y In integrated planning, data can be transferred from upstream systems of Cost Center Accounting to cost center planning. y If you have planned this data in the upstream systems and now want to transfer it unchanged to cost center planning, it is not necessary to replan the data in Cost Center Accounting.
y To be able to use integrated planning, a number of requirements must be met in Cost Center Accounting and in the upstream systems. For example, if you want to transfer planned values for statistical key figures, you must first create master records for these key figures and then link them to the Logistics Information System (LIS). y The personnel costs planned in Personnel Administration can be transferred to the affected cost centers. Integrated planning between Cost Center Accounting (CO-OM-CCA) and personnel planning enables you to plan personnel costs for target wages, payroll results, or basic pay, and then transfer these costs to Cost Center Accounting. y Integrated planning between Cost Center Accounting (CO-OM-CCA) and Asset Accounting enables you to transfer periodic depreciation charges and interest (on the tied-up capital) to primary cost planning in Cost Center Accounting.
© SAP AG
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Planning Internal Orders
Internal Orders Overall planning
Primary/secondary costs and revenues Manual
Unit costing
Stat. key figures
Automatic
Cost elements
Overhead rate
Activity input
Periodic reposting
Revenues
Distribution/assessment Indirect activity allocation Process costs Settlement
SAP AG 2001
Costs are normally planned for
orders that have a long life cycle. Orders with a short life cycle, such as for unexpected small repairs are normally not planned.
When
you plan internal orders, there are three different cost planning levels:
y Overall planning is the simplest level of planning order costs. You can plan overall values and yearly values regardless of the cost elements.
y If detailed information is available for an internal order, you can use the primary/secondary cost and revenue planning. For manual planning purposes, this comprises the planning of primary costs, activity inputs and revenues. If the order is plan integrated, you can, for example, credit plan values by making settlement to a cost center. y You can use unit costing to make your planning more detailed than on cost elements.
In
integrated planning for internal orders, you include the cost element and activity input planning for an internal order in the cost center or business process planning. You activate integrated planning in the plan version. When you plan activity inputs for integrated internal orders, the scheduled activity is posted to the sender cost center/sender process. In addition, planned settlements and periodic repostings of integrated orders to cost centers/processes are allowed. This also applies to plan allocation of indirect activity, assessments and distribution of cost cneters/processes to plan integrated orders.
© SAP AG
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Planning Integration - Product Cost Planning Logistics Information System
Sales Planning/ Forecasts
Sales Quantity
Sales Quantity
Production - PP SOP, LTP
Material Cost Estimate
Material Master
Cost of goods manufactured Activity Requirements
Cost Centers Human Asset Cost Planning SAP AG 2001
Plan-Integrated Orders
For
the costing, product cost planning uses master data from other R/3 applications, for example, bills of materials, routings and work centers from production planning, and cost centers, activity types and business processes from Overhead Cost Controlling.
You
can use various tools for product cost planning, irrespective of whether data is available from Production Planning (PP or PP-PI) or not: y Product Costing with Quantity Structures
Costs are calculated for a material via automatic derivation of the quantity structure from bills of materials and routings or the master recipe, or from network resources. If certain prerequisites exist, the results can be updated in the standard price field or in another price field of the material master record.
y Product Costing without Quantity Structures
Costs are calculated for a material without automatic derivation of a quantity structure. When you execute the costing, either you must enter the quantity structure manually, or copy it from a template. If certain prerequisites exist, the results can be updated in the standard price field or in another price field of the material master record.
y Reference and Simulation Costings
Costs are calculated for an abstract object that is known as a ’base planning object’. When you execute the costing, either you enter the quantity structure manually, or you copy it from a template. The result is a planned quantity structure that you can use in subsequent costings uner the name of the base planning object. You can use i as "additive costs" for a product costing with a quantity structure.
© SAP AG
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Product Cost Planning: Overview Views for costing result
Quantity Structure BOM
Routing
Cost Components Mat. Work
Prices Process Costs Overhead
Cost Elements 400000 610000 660000 650000
$ $ $ $
Consumption
Price of material
Cost estimate
Value Structure
OH Process
Itemization M M E X G
Pricing Valuation Profitability Analysis Cost Object Accounting
Material $ Material $ Activity $ Process $ O/H costs $
SAP AG 2001
When
you create a cost estimate with a quantity structure, you need to enter the costing variant, the material, the plant, and the lot size. The dates are proposed from the costing variant and determine the following: y The period of validity of the cost estimate (costing date from/to)
y The selection date for the bill of material and routing (quantity structure date) y The pricing date for the material components and activities (valuation date)
You
use the transfer control indicator to specify that you either want to use an existing cost estimate for material components, or create a new cost estimate.
The system selects
and values the quantity structure automatically.
The costing results can be
saved and displayed as itemizations, cost element itemizations, or cost component splits. The itemization shows detailed information on the origin of the costs, such as the quantities and prices of the materials and internal activities used.
The cost
element itemization groups the individual costing items into cost elements. The cost elements group the costs in order of appearance. Cost elements are determined via account determination for materials, activity type master record for activities or via activity type planning , and via the process master record for processes.
The cost
component split groups the cost elements into cost components. When a multilevel structure is costed, the cost component split is rolled up so that the original identity of the costs is retained for analysis.
You
can analyze the results of the cost estimate directly in the information system.
© SAP AG
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Overhead Rate Material costs
+
Material overhead costs
=
Material overhead
+ Production overhead
+
Production overhead costs
=
Cost of goods manufactured
= Cost of goods manufactured
+ Sales overhead
+
Costing sheet
=
Costing Sheet
Cost of goods sold
SAP AG 2001
Overhead
costs can be assigned (e.g. energy costs or warehouse costs) to the product.
You
can use costing sheets to calculate your own overhead costs. If you use the traditional method, you apply the overhead costs to the reference object as a percentage or quantity rate.
In
the costing sheet, you determine how the overhead costs are calculated for the cost of goods manufactured and the cost of goods sold.
The costing sheet is assigned
to a valation variant, which is then assigned to a costing variant. When you create a material costing that uses this costing variant, the assigned costing sheet is used for the overhead cost calculation.
When
you calculate overhead costs, the system chooses the costing item category G. the overhead costs are updated according to the cost elements that you created in the costing sheet.
The standard
system contains predefined costing sheets. In addition, you can create your own costing sheets as required.
© SAP AG
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Cost Rollup in Product Cost Planning
Quantity
Unit
Value
Material
1
PC
215 $
100
Housing T-B100
1
PC
20 $
20
Shaft
1
PC
150 $
80
1
PC
80 $
80
Pump T-F100
-
T-B300
Valves T-T400
Work
OH
80
15
50
10
Process 20
10
SAP AG 2001
The purpose of
cost rollup is to ensure that the cost of goods manufactured (material and production costs) of all materials in a multilevel BOM are included in the cost estimate of the higher-level material. This is achieved by assigning the costs in a cost estimate to cost components.
When a
cost estimate for a multilevel BOM is created, the costs are rolled up. That is, the cost components of the cost component split are passed upwards in the hierarchy to the cost estimate of the higher-level material.
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Price Update Analysis of costing results
Material Master Standard price Future
Current Previous
10
Mark for Company code Period, Fiscal year Costing var./ Ver.
Mark standard cost estimate
Future
15
Future
Release standard cost estimate
Current Previous
10
Current
Previous
15
10
Inventory Inventory revaluation revaluation
SAP AG 2001
Marking and releasing a
standard cost estimate updates the standard price for the material in the material master record. This leads to a revaluation of the inventory (important for FI).
The following prerequisites must
released:
be fulfilled, before a standard cost estimate can be marked or
y The standard cost estimate must be free of errors (status CT)
y The marking and release must be reliable. The company code and period in which the standard cost estimate can be marked with a set valuation variant, are entered in the authorization for a marking. The authorization should take place once per period by the employee responsible. If you mark a standard cost estimate, the results are updated in the material master records as the future standard price.
When
price.
you release the standard cost estimate, these future prices are updated as the current standard
You
can only release a standard cost estimate once per period, unless you delete the previously release standard cost estimate (using a special program) from the database. You should also always check the standard cost estimate to ensure that it is correct before you release it for a product. There are specialized reports in the Information System that allow you to do this.
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Planning Integration - Update Sales Plan/CO-PA Logistics Information System
Sales Planning/ Forecasts
Sales quantity
Profit Planning
Cost components
Sales quantity
Production - PP SOP, LTP
Product costing
Material master Cost of goods sold
Activity requirements
Cost Centers Human asset cost planning SAP AG 2001
Plan-Integrated Orders
To copy sales
planning (used in the planning cycle) from CO-PA to profit planning, you have to match the planned revenues and the cost of goods manufactured, generated on the basis of the plan. You can use the valuation function to do this.
Valuation in
CO-PA uses the results of product costing to calculate the cost of goods manufactured (cost of goods sold). The quantities of the planned products are multiplied with the standard cost of goods manufactured and transferred to CO-PA according to cost component. This allows detailed fixed and variable costs to be included in the individual contribution margins.
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Transferring the Costing Results to CO-PA
Quantity
Unit
Value
Material
Labor
1
PC
$215
100
80
15
Housing T-B100
1
PC
$20
20
Shaft
T-B300
1
PC
$150
80
50
10
Valves T-T400
1
PC
$80
80
Pump T-F100
-
OH
Process 20
10
COPA
SAP AG 2001
The cost
components from material costing can be used in Profitability Analysis to valuate the plan or actual data of billing documents. This enables you to see detailed information in Profitability Analysis on the origin of your product costs and to analyze your contribution margins.
To transfer the
material costs, you assign the cost components with the cost of goods manufactured and the sales and administration costs to the corresponding value fields of an operating concern.
The calculated
cost of goods sold is then compared against the planned revenues so that the planned invoice amounts can be calculated.
In
Customizing for Profitability Analysis, you can make the required settings for the transfer of the data from material costing to Profitability Analysis.
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Integration of Services in Planning Strategic Procedure
Target Requirements
Sales Planning
Process/ Resourceplanning using template Process/ Resource Consumption
Profit Planning
Template
Cost center/ Activity type
Monetary Valuation of plan quantity structures Prices
Process SAP AG 2001
Services,
that are not dependent on production plans are realized using a template in the integrated planning cycle.
The template is
used to calculate resource and/or process quantities, that are to be used from the planned sales quantity calculated in CO-PA.
After
primary cost planning has been completed, the prices for activity types and processes are generated using price determination. These prices are then used to valuate the planned quantity structure, whereby, for example the process costs are transferred to CO-PA.
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Integrated Planning in Profit Center Accounting
Profitability Analysis Projects Networks
Profit Center Plan PC
Sales Discounts Cost of sales Marketing costs Administration costs …. Internal Order Business Process
100,000 5,000 50,000 10,000 15,000
MRP
SOP t
Cost Center
SAP AG 2001
To enable internal areas
of responsibility to be controlled and valuated effectively, you should restrict profit center planning to those factors that are measurable and that can be influenced directly. The responsible employees of the profit center can only make use of the planning data if they are in a position to influence the costs, revenues, and stocks in their area. Since the organizational structure and scope of the responsibility areas in your company depend mainly on individual factors, the plan should be as flexible and multidimensional as possible.
Profit center planning is
therefore an integral part of overall enterprise planning. Profit centers illustrate particularly well the integrated nature of enterprise planning, since the planning data is essentially generated by other applications and supplemented or modified in the profit centers. Profit center planning is part of short-term business planning that covers one fiscal year.
During the planning process,
the individual planning areas are combined into an integrated planning network. You can use different plan versions to account for changes during the planning process, or to enable the use of different planning scenarios for a given time frame.
Profit center planning involves
two steps. First, the planning data is transferred to the profit centers from the following applications: Cost Center Accounting, Internal Orders, Profitability Analysis, and Product Cost Planning. Then the planning can be modified directly in the profit centers.
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Planning Process Costs
At the conclusion of this topic, you will be able to: z Identify the additional functions provided in Activity-Based Costing
z Use some of the basic planning functions that contain business processes.
SAP AG 2001
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Comparison of The Push and Pull Approaches (I)
Push
Pull
Finances
Finances
ResourceDriver
Cost Assignment
Cost Driver
Cost Assignment
Products, Customers channels etc.
Cost Center (Resources) ResourceDriver
Cost Driver
Products, Customers channels etc.
Costs = quantity x price
Cost Center (Resources)
Resource quantity pull
Cost Assignment
SAP AG 2001
The R/3
System supports two different approaches in Actvity-Based Costing (ABC): Push and Pull.
The push approach
is the normal approach used in ABC, and is applied when costs are distributed using tracing factors (resouce and cost drivers). The flow of activity quantity is of no significance for this approach.
The main
difference between the quantity consumption method (pull) and pure cost distribution (push) is that the pull method is based on the allocation of activity and business process quantities, which you then valuate with prices in the second step. Values are allocated using a cost element that refers to a certain activity type or business process. The fact that you can create several quantity and cost flows in this way means that you open up many more options for ABC in process cost management.
The pull
method also provides solutions to questions such as "how do I calculate idle-capacity costs?". You can only answer this question once you know how much capacity has been used, and have compared it with the total capacity.
When enterprises
use Activity-Based Cosint, they increasingly opt for the pull method, since it is capable of more with regards to the management of resources and capacity.
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Comparison of The Push and Pull Approaches (II)
Push approach
Pull approach
Implementation
Uncomplicated
+
Requires detailed knowledge of standards and cost behavior
-
Process optimization/ flexible budgeting
No quantity structure • No retroactive withdrawal • No capacity display (requires dummy processes for empty capactities) • No resource usage
Quantity Structure • Retractive withdrawal • Identifcation of idle capacity • Use of resources at an early stage (planning)
+
Fair costing
Cost assignment not based actual use of resources • Idle capacity costs are extra expense for products and customers
Price calculation using + available capacity • Idle capacity costs are only assigned to products and customers if required
SAP AG 2001
Even
though the push approach is easy to understand and implement, it does have some disadvantages in comparison with the pull approach. In particular, this can be seen in the information that is provided by ABC in process cost management.
Since there is
no quantity flow model, this approach does not enable a retroactive withdrawal of sales quantities (CO-PA) up to the resource level for cost centers. However, this model is of significant importance for determining idle-capacity and the use of resources for flexible budgeting. To optimize your processes, you can either use the idle-capacity for continued growth, or remove them long-term.
A
fair costing cannot be guaranteed if the push approach is used, since the idle capacity costs are distributed to products and customers that are not necessarily responsible for these costs. The only solution is to use dummy processes, which carry these idle capacity costs. However, you need an exact knowledge of the idle capacity costs, since the system cannot determine them without a quantity structure. In the pull approach, the idle capacity costs remain on the cost centers and can be allocated to the plant or enterprise level depending on the cause.
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Integrated Activity Based Costing Bill of material
Cost Cost Cost CO-CCA Center 1 Center 2 Center 3 AT x AT 1
Routing
AT 2 Overhead structure
Process 1
CO-ABC
Allocation Assessment
CO - PA
SAP AG 2001
COPC
Production order
Process 2 Template
Variance Allocations Standard cost estimate with process costs
Warehouse
Data LIS Warehs. (LIS)
In
integrated ABC, processes become full controlling objects. They are integrated into the operational value flow of the R/3 system and can become relevant for inventory valuation.
A
structure called the template is the central tool for assigning (or tracing) process quantities to cost objects. By selectively using integrated ABC, you can allocate indirect costs to a single cost object using overheads (calculated with costing sheets), standard values, or processes for various types of overhead.
In
Profitability Analysis, you can also analyze process costs for a production an aggregate level as these costs are transferred to CO-PA, through the cost component view of product costing.
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Cost Allocation with Template
Cost Object (order, project etc.)
Material LIS
Order Header Material Lot-size Routing
Functions Process Template
Bill of materials
CO - Values Material Business transactions Overhead costs Processes
Statistical Key Figures
ss Proce ties quanti
Processes External Sources
Other SAP Sources Sources for cost drivers
SAP AG 2001
You
can use the template functions to determine how the cost driver quantity for a process is to be calculated. You can also define where the template should look for cost driver information in the system.
Once
the cost driver quantity is calculated, the process template exchanges data with Product Costing. Product Cost Controlling multiplies the calculated process quantities with the process price. The resulting costs of the overhead cost resources are then allocated with a particular cost object. Finally, Product Cost Controlling credits the process and debits the cost object accordingly.
If
you allocate by cause instead of using overheads for the basis of your costing, you can avoid the equal distribution of overheads among all the cost objects.
Planned
and actual process quantities are calculated using different functions. You can use this method for higher-level models for the plan process quantities. For actual process quantities, however, the operative driver quantities in LIS are often used.
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Planning and Plan Integration: Unit Summary
At the conclusion of this unit, you should be able to: z Name the most important cost accounting methods in R/3 and list their differences z Name the application components relevant to integrated planning, and explain their tasks
z Explain how planning is used in different industries z Identify the additional features and functionality available when using ABC z Perform some basic planning functions.
SAP AG 2001
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Exercises Unit: Planning and Integrated Planning Topic: Introduction to Planning
•
Describe how planning is used to forecast costs and revenues and make decisions.
The cost center managers want a clear picture of the results that can be expected from your cost centers in future periods. In addition, they require permanent actual figures so that they can recognize variances from the plan in time, and take action, instead of waiting until the end of the period.
1-1
Describe how you might best use the CO planning and budgeting functions in your company. 1-1-1 Name some of the planning goals: _________________________________________________________ _________________________________________________________ _________________________________________________________ _________________________________________________________ 1-1-2 Will you use both planning and budgeting? _________________________________________________________ _________________________________________________________ 1-1-3 How many planning versions could you provide? What could be included in these planning versions ( for example, best case, worst case etc.)? Would you use the “copy plan” function to create some of these plan versions? _________________________________________________________ _________________________________________________________ _________________________________________________________
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Unit: Planning and Integrated Planning Topic: Planning Based on Different Cost Accounting Methods
•
Use the planning tools and see how certain information is planned on master data records.
Since the enterprise would like to be able to forecast costs and revenues, the planning tools will be used to enter planning data into the R/3 System. This planning data will be used for plan/actual comparisons, to see how different areas of responsibility performed. The comparison will also be used for control purposes and to monitor processes, thus making adjustments or corrections possible if there variances from the plan. You will examine different planning functions in Cost Center Accounting and see some of the options for planning cost center inputs and outputs. Note: You can use the SAPALL planner profile for planning in CO-OM. 2-1
Cost element planning: A cost center consumes materials and external services to provide its own services for other CO objects (cost centers or orders for example). This consumption triggers cost postings (debits) on the cost center. You can plan primary costs by entering planning data for the cost elements that are to be used for posting the service or material consumption as actual values. 2-1-1 Plan the costs for cost element (417000) for services used on by your cost center SERV##. Plan the direct labor costs cost element (420000) on your cost center PROD-##. Enter the plan for the periods 1 to 12 for the current fiscal year and plan version 0. The fixed plan costs for the year amount to 36000. The amount is to be equally distributed among the separate posting periods. Save the plan data. 2-1-2 Plan the cost element for direct labor costs (420000) on your cost center PROD-##. Enter periods 1 to 12 and the current fiscal year. Enter the plan for the periods 1 to 12 for the current fiscal year and plan version 0. The fixed plan costs for the year amount to 19200. The amount is to be equally distributed among the separate posting periods. Save the plan data.
2-2
Activity type planning: To keep an overview of the performance of a cost center, you may be interested in monitoring the activity provided by the cost center (output). Plan the price and the plan quantity. 2-2-1 Plan the repair hours to be provided by your service cost center SERV-##, using the activity type REP-##. The planned activity quantity is 1000 hours and the fixed price is 60 per unit. Change the equivalence number to 2.
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2-2-2 It is also the task of the service cost center to check the fixed assets on a regular basis. Therefore cost center SERV-## provides the activity type CHK-##. The planned activity quantity is 500 hours and the fixed price is 40 per unit. Ensure that equivalence number 1 has been entered. Your production cost center produces the activity 1421. Plan the activity type 1421 as the activity output of your cost center PROD-##. The planned activity quantity is 120 hours and the fixed activity price is 180 per unit. 2-3
Activity-dependent cost planning: In order to reflect that some costs are only incurred by a cost center if certain activity types are produced by that cost center, you need to plan those costs as activity-dependent. In addition, you can decide whether the amount is to depend on the output quantity of this activity type. If the cost depends on the activity quantity, it should be planned as a variable cost. If it does not, it should be planned as a fixed cost. Operating supplies costs for the service cost center (SERV-##) are dependent on the REP-## activity type. Plan the operating supplies costs (cost element 403000) as activity-dependent, with 6000 fixed plan costs and 18000 variable plan costs.
2-4
Activity input planning (activity-independent): Your production cost center PROD-## plans to consume 100 hours of the activity type REP-## from your service cost center SERV-##. Use the activity input planning layout (1-102) to enter the planning data. Select Next layout to change the layout to 1-102. Note that the activity provided by the service cost center, which the production cost center wants to use is not dependent on the activity quantity provided by the production cost center (thus activityindependent). Therefore, you should make sure that the activity type field is blank.
2-5
Run the Cost Centers: Planning Overview report for periods 1 to 12 of the current fiscal year and plan version 0. Run the report to view in detail the effect of the planning steps on the service cost center (SERV-##). Review the prices.
Scroll through the report to see the activities planned for the selected cost center.
2-6
© SAP AG
Automatic calculation of the plan price: If a cost center plans to produce a type of activity, it must also plan the costs it expects to incur in order to produce the planned activity quantity. Costs that have been planned independently of activity need to be coded. This enables you to calculate the unit cost of producing the activity. You can use automatic plan price calculation to calculate this value. (Note that the term “price” always refers to a unit of the activity type to be produced). If a AC040
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cost center produces more than one type of activity, you need to distribute the activity-independent plan costs among the activity types of the cost center to calculate the price of each single activity type. In our example, the equivalence numbers, which were entered in the exercise on activity type planning, are the basis for the cost splitting. 2-6-1 Run the automatic plan price calculation for your service and production cost centers. Use your cost center group CENTER-## for periods 1 to 12 in the current fiscal year. Choose No business processes and Test run and Detail lists from the processing options. Compare your results to the manually planned prices (Exercise 2-2). Record the prices from the manual and automatic determination. If your automatically planned prices are acceptable, post the new prices. Activity Type/Cost Center
Manual Price
Automatic Price
CHK-##/SERV-## REP-##/SERV-## 1421/PROD-## 2-6-2 Run the Cost Centers: Planning Overview report for periods 1 to 12 of the current fiscal year and plan version 0. Run the report to view in detail the effects of the price plan on the activity types of the service cost center (SERV-##). Is the balance zero? (Small differences from rounding are allowed). Review the prices. _________________________________________________________
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Unit: Planning and Integrated Planning Topic: Integrated Plan Cycle
•
Create, flag and release a plan product costing.
•
The integrated plan cycle helps clarify the flow of the planning results.
Since the company plans to produce products and to provide services based on market demand, it was decided to start the planning cycle in COPA. The resulting sales plan (business plan) has been transferred to SOP (Sales & Operations Planning), and the required material quantities and production resources were calculated. At the completion of the SOP planning process, cost center figures were planning, and the planned activity prices were calculated. Based on these results, it is now possible to create a standard cost estimate for the material for the next period. 3-1
Before a standard cost estimate is created, you need to check the calculated price for one of the production activities in the pump assembly routing T-F1##. The first production operation for the pump assembly T-F1## occurs at work center T-M##. This work center is assigned to cost center 4230, and the planned labor for this operation is 10 minutes per piece. The activity type 1421 has been assigned to this operation. Check the planned price for activity type 1421 and cost center 4230. Note down the fixed and variable plan prices. Fixed plan price:_________________________________________ Variable plan price: ________________________________________
3-2
After cost center planning, you need to recalculate the cost of goods manufactured for T-FI##. You will also create a new standard cost estimate, including the planned prices from a cost center plan. 3-2-1 Create a standard cost estimate for the material T-F1## with costing variant PPC1 and a lot size of 500 pieces. Change the default for the Costing from date to today’s date. Transfer the other default data for Costing date to, Quantity structure and Valuation. 3-2-2 On the Create Material Costing with Quantity Structure screen, check the cost calculation results. Expand the left-hand side of the screen (panel). Place the cursor on the pump and expand the subtree to display all the material components in a hierarchy. By double clicking on the different material components in the costing structure, you display the costings for each component in the right hand screen section. 3-2-3 Display all the details (resources) used for each of these materials, including production activity, components, processes and overhead rates.
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To do this, place the cursor on the pump to select it and click on the icon “Mat. only/all items” Find activity type 1421, cost center 4230, and verify that the price listed matches the price that you reviewed in exercise 3-1. Reduce the size of the left-hand side of the screen again. 3-2-4 Now analyze the itemization displayed in the lower section of the screen. You can expand the upper edge of the screen using the mouse to drag it upwards. Change the costing allocation base “1 piece” by choosing Settings -> Cost Display. What does pump T-F1## cost?
_____________________
Try to select other layouts to obtain a cost display with a different layout (e.g. layout 1SAP09 for a list in order of the cost elements). 3-2-5 Save the costing with itemization and log. 3-3
To use the result of this costing as the future standard price, you need to flag the costing by choosing Price Update in the menu. Once you have flagged this, call up Costing 2 view of the material master record for T-F1## and review the future price that is entered in the material master record.
3-4
Release the costing for material T-F1##. This makes the costing result the new standard price. Check this in the Costing 2 view in the material master record.
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Unit: Planning and Integrated Planning Topic: Activity-Based Costing
•
In the following, you will get to know Activity-Based Costing and learn how to transfer the allocated process amounts to the standard cost estimate.
An important step in the plan integration cycle is the calculation of the costs of goods manufactured based on the business plan. Since one of the company objectives is to minimize overhead costs, it has been decided to use ABC to have a more dynamic method cost allocation from the overhead management area to the production controlling area. The process template has already been maintained to allocate planned process quantities to the standard cost estimate accordingly.
4-1
In the following, you learn about Activity-Based Costing using a standard cost estimate. 4-1-1 Call up your standard cost estimate from the previous exercise (material TF1##, costing variant PPC1). Which process template is this costing based on? Look this up under the tab page Valuation. The name of the template is _______________________________ 4-1-2 Change the costing to the display of cost of goods sold under the tab page Costs. 4-1-3 Select layout ISAP06 from the itemization (grouped by operations). To which costs and quantities has overhead been applied for the automatically allocated processes? This information is identified with the item category X.
_________________________________________________________ _________________________________________________________
4-1-4 Change the costing to the display of cost of goods manufactured under the tab page Costs. To which costs has overhead been applied for automatically allocated processes now? What conclusion do you draw? © SAP AG
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________________________________________________________ ________________________________________________________ 4-1-5 Which costs are incurred by the first operation (0010)? ________________________________________________________ ________________________________________________________
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Solutions Unit: Planning and Integrated Planning Topic: Introduction to Planning
•
Describe how planning is used to forecast costs and revenues and make decisions.
The cost center managers want a clear picture of the results that can be expected from your cost centers in future periods. In addition, they require permanent actual figures so that they can recognize variances from the plan in time, and take action, instead of waiting until the end of the period.
1-1
Describe how you might best use the CO planning and budgeting functions in your company. 1-1-1 Name some planning goals. 1-1-2 Will you use both planning and budgeting? 1-1-3 How many planning versions could you provide? What could be included in these planning versions (for example, best case, worst case etc.)? Would you use the “ copy plan” function to create some of these plan versions? You can give more than one answer.
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Unit: Planning and Integrated Planning Topic: Planning Based on Different Cost Accounting Methods
•
Use the planning tools and see how certain information is planned on master data records.
Since the enterprise would like to be able to forecast costs and revenues, the planning tools will be used to enter planning data into the R/3 System. This planning data shall be used for later plan/actual comparisons, to see how responsibility areas perform. The comparison will also be used for control purposes, to monitor processes and make adjustments or corrections if variances from the plan occur. You will examine different planning functions in Cost Center Accounting and see some of the options for planning cost center inputs and outputs. 2-1
Cost Element Planning 2-1-1 Plan the costs for cost element (417000) for services used on by your cost center SERV##. Accounting o Controlling o Cost Center Accounting o Planning o Cost Elements/Activity Inputs o Change Enter Version 0. Enter 1 in the From period field. Enter 12 in the To period field. Enter the current fiscal year in the Fiscal year field. Enter SERV-## in the Cost center field. Enter 417000 in the Cost element field. Select Form-based entry. Select the Overview screen. Enter 36000 in the Fixed plan costs column. Enter 1 in the DK column next to the value for the fixed plan costs. Choose Post. Remain on the initial screen for Cost Element/Activity Input Planning for the next exercise. 2-1-2 Plan the cost element for direct labor costs (420000) on your cost center PROD-##.
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Enter PROD-## in the Cost center field. Enter 420000 in the Cost element field. Select the Overview screen. Enter 19200 in the Fixed plan costs column. Enter 1 in the DK column next to the value for the fixed plan costs. Choose Post. 2-2
Activity Type Planning 2-2-1 Plan the repair hours to be provided by your service cost center SERV-##, using the activity type REP-##. Accounting o Controlling o Cost Center Accounting o Planning o Activity Output/Prices o Change Enter Version 0. Enter 1 in the From period field. Enter 12 in the To period field. Enter the current fiscal year in the Fiscal year field. Enter SERV-## in the Cost center field. Enter REP-## in the Activity type field. Select the Overview screen. Enter 1000 in the Plan Activity column. Enter 1 in the DK column next to the value for the plan activity. Enter 60 in the Fixed price field. Enter 2 in the EquiNo. field. Choose Post. Remain on the initial screen for Change Planning Activity/Prices for the next exercise. 2-2-2 The service cost center SERV-## provides the activity type CHK-##. Enter CHK-## in the Activity type field. Select the Overview screen. Enter 500 in the Plan activity column. Enter 1 in the DK column next to the value for the plan activity. Enter 40 in the Fixed price field. Verify that the EquiNo field is set to 1. Choose Post. Remain on the initial screen for Change Planning Activity/Prices for the next exercise. 2-2-3 Plan the activity type 1421 as the activity output of your cost center PROD##. Enter PROD-## in the Cost center field.
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Enter 1421 in the Activity type field. Select the Overview screen. Enter 120 in the Plan activity column. Enter 1 in the Plan activity column next to the value for the plan activity. Enter 180 in the Fixed price field. Choose Post. 2-3
Activity-Dependent Cost Planning Plan the operating supplies costs (cost element 403000) as activity-dependent, with 6000 fixed plan costs and 18000 variable plan costs. Accounting o Controlling o Cost Center Accounting o Planning o Costs/Activity Inputs o Change Enter Version 0. Enter 1 in the From period field. Enter 12 in the To period field. Enter the current fiscal year in the Fiscal year field. Enter SERV-## in the Cost center field. Enter REP-## in the Activity type field. Enter 403000 in the Cost element field. Select Form-based entry. Select the Overview screen from the standard toolbar. Enter 6000 in the Fixed plan costs column. Enter 1 in the DK column immediately following the Fixed plan costs column. Enter 18000 in the Variable plan costs column. Enter 1 in the DK column next to the value for the variable plan costs. Choose Post. Remain on the initial screen for Change Planning Cost Elements/Activity Inputs for the next exercise.
2-4
Activity input planning (activity-independent): Your production cost center PROD-## plans to consume 100 hours of the activity type REP-## from your service cost center SERV-##. Note that the activity provided by the service cost center, which the production cost center wants to use is not dependent on the activity quantity provided by the production cost center (thus activityindependent). Therefore, you should make sure that the activity type field is blank.
Select Next layout to change the layout to 1-102. © SAP AG
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Enter PROD-## in the Cost center field. Make sure the Activity type field is blank. Enter SERV-## in the Sender cost center field. Enter REP-## in the Sender activity type field. Select the Overview screen. Enter 100 in the Fixed plan cons. column. Enter 1 in the DK column next to the value for the fixed plan consumption. Choose Post. 2-5
Run the Cost Centers: Planning Overview report. Accounting o Controlling o Cost Center Accounting o Information System o Reports on Cost Center Accounting o Planning Reports o Cost Centers: Planning Overview Enter SERV-## in the Cost center field. Enter the current fiscal year in the Fiscal year field. Enter 1 in the Period field. Enter 12 in the To field. Enter 0 in the version field. Execute the report.
Scroll through the report to see the activities planned for the selected cost center.
In the section of the activity element overview, place your cursor on an activity type and click on the icon list above it on the Display price icon. 2-6
Automatic Calculation of Plan Activity Price 2-6-1 Run the automatic plan price calculation for your service and production cost centers. Accounting o Controlling o Cost Center Accounting o Planning o Allocations o Price Calculation Select Cost center group. Enter your CENTERS-## in the Cost center group field. Select No business processes. Enter 0 in the version field. Enter 1 in the Period field. Enter 12 in the To field.
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Enter the current fiscal year in the Fiscal year field. Select Test run and Detail list. Select Execute. If your activity type prices have been calculated correctly, select Post. Choose Continue to delete the message and exit the transaction. 2-6-2 Run the Cost Centers: Planning Overview report for periods 1 to 12 of the current fiscal year and plan version 0. Cost Center Accounting o Information System o Reports for Cost Center Accounting o Planning Reports o Cost Centers: Planning Overview Enter SERV-## in the Cost center field. Enter the current fiscal year in the Fiscal year field. Enter 1 in the Period field. Enter 12 in the To field. Enter 0 in the version field. Select Execute. In the section of the activity element overview, place your cursor on an activity type and click on the icon list above it on the Display price icon.
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Unit: Planning and Integrated Planning Topic: Integrated Plan Cycle
•
Create, flag and release a plan product costing.
•
The integrated plan cycle helps clarify the flow of the planning results.
Since the company plans to produce products and to provide services based on market demand, it was decided to start the planning cycle in COPA. The resulting sales plan (business plan) has been transferred to SOP (Sales & Operations Planning), and the required material quantities and production resources were calculated. At the completion of the SOP planning process, cost center figures were planning, and the planned activity prices were calculated. Based on these results, it is now possible to create standard cost estimates for materials for the next period.
3-1
Check the planned price for activity type 1421 and cost center 4230. Note down the fixed and variable plan prices. Accounting o Controlling o Cost Center Accounting o Information System o Reports on Cost Center Accounting o Prices o Cost Centers: Activity Type Prices Enter 4230 in the Cost center field. Enter 1421 in the Activity type field. Enter Version 0. Enter the current fiscal year in the Fiscal year field. Enter 1 in the From period field. Enter 12 in the To field. In the standard toolbar, choose Overview screen.
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3-2
Create a standard cost estimate. 3-2-1 Create a standard cost estimate for the material T-F1## with costing variant PPC1 and a lot size of 500 pieces. Accounting o Controlling o Product Cost Planning o Product Cost Planning o Material Costing o Costing with Quantity Structure o Create Enter T-F1## in the Material field. Enter 1000 in the Plant field. Enter PPC1 in the Costing variant field. Enter 1 in the Costing version field. Enter 500 in the Costing lot size field. Select Enter. Change the From costing date to the current date, leaving the other fields unchanged. Select Enter. 3-2-2 On the Create Material Costing with Quantity Structure screen, check the cost estimate results. On the left-hand side of the screen, check whether the costing structure is displayed. If this is not the case, choose the Costing structure symbol to display it. Place the cursor on the top level of the costing structure (pump) and choose the symbol Expand subtree displayed directly above the costing structure. The expanded list displays all the components that have been used. In the section at the lower right of the screen, the costs for materials, production activities, processes and overhead rates are displayed in detail. You can select any material component from the costing structure. In the right-hand section, the costing for the component is displayed. The section at the bottom right displays the corresponding detailed costs. In the costing structure to the left of the material component, choose the calculator symbol with a double-click. The system calculates the costs for the selected component and displays them in this section.
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3-2-3 Analyze the costing structure in more detail. Display all the details (resources) used for each of these materials, including production activity, components, processes and overhead rates. To do this, place the cursor on the pump to select it and click on the icon “ Mat. only/all items” For activity type 1421 and cost center 4230, the consumption of this resource has been valuated with the price you looked up in exercise 3-1. Reduce the size of the left-hand side of the screen again. 3-2-4 Now analyze the itemization displayed in the lower section of the screen. You can expand the upper edge of the screen using the mouse to drag it upwards. Change the costing allocation base 1 piece by choosing Settings -> Cost Display. The system displays the costs for 1 pump T-F1##. This value is, however, still based on the costing lot size of 500 pieces. Try to select other layouts to obtain a cost display with a different layout (e.g. layout 1SAP09 for a list in order of the cost elements). 3-2-5 Save the cost estimate. Click on the Save symbol to save your costing. When the system displays the dialog box Update parameters, choose Itemization and Log, then Continue. 3-3
You need to flag the cost estimate so that the result can be used as the future standard price. Accounting o Controlling o Product Cost Controlling o Product Cost Planningo Material Costing o Price Update Enter the current period and current fiscal year in the Posting period/fiscal year fields. Enter company code 1000. Enter 1000 in the Plant field. Enter T-F1## in the Material field. Choose Allowance for marking. For company code 1000, Legal valuation, you need to enter costing version 1. The symbol in the first column is green. This means that the marking allowance for version 1 has already been given. Go back to the initial screen using the green arrow. Deactivate the Test run indicator, and choose Execute. The system displays an overview. To check the effects on the material master, click on the name of the material T-F1##. This calls up the Display material master transaction. Select the Costing 2 view. The value of the standard cost estimate is displayed in the standard cost estimate column Future. Go back to the initial screen for price updates.
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Do not leave the transaction. 3-4
Release the costing for material T-F1##. This makes the costing result the new standard price. Choose Release. Deactivate the Test run indicator, and choose Execute. The system displays an overview again. To check the effects on the material master, click on the name of the material T-F1##. This calls up the Display material master transaction. Select the Costing 2 view. The value of the standard cost estimate is displayed in the standard cost estimate column Current. Go back to the initial screen in the price update and leave the transaction.
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Unit: Planning and Integrated Planning Topic: Activity-Based Costing
•
In the following, you will get to know Activity-Based Costing and learn how to transfer the allocated process amounts to the standard cost estimate.
An important step in the plan integration cycle is the calculation of the costs of goods manufactured based on the business plan. Since one of the company objectives is to minimize overhead costs, it has been decided to use ABC to have a more dynamic method cost allocation from the overhead management area to the production controlling area. The process template has already been maintained to allocate planned process quantities to the standard cost estimate accordingly.
4-1
In the following, you learn about Activity-Based Costing using a standard cost estimate. 4-1-1 Display your standard cost estimate. Accounting o Controlling o Product Cost Planning o Product Cost Planning o Material Costing o Costing with Quantity Structure o Display Enter T-F1## in the Material field. Enter 1000 in the Plant field. Enter PPC1 in the Costing variant field. Select Enter. Click on the Valuation tab page. The template is called COPC-10-1. 4-1-2 Click on the Costs tab page and change the display to Cost of Goods Sold. 4-1-3 Enlarge the itemization screen. Click on the Select layout icon and choose layout 1SAP06. The process costs are identified by the item category X. The value and the quantities can be seen. The system used processes 300900 and 400900 to calculate the cost of goods sold. These processes are related to the overhead costs that were taken into account.
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The quantity one was specified since the template makes it clear that one unit of both processes is required to manufacture 500 pumps. 4-1-4 Change the costing to the display of cost of goods manufactured under the tab page Costs. Now the system only displays costs for process 300900. It can be deduced, therefore, that process 400900 is allocated using a cost element that was only assigned to the cost of goods sold, and thus is not included in the cost of goods manufactured. 4-1-5 Which costs are incurred by the first operation (0010)? The layout currently in use displays the costs sorted by operation from the routing on which it is based. This means that the costs for each operation can be directly displayed.
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Posting to CO from Other Modules: Content
z Postings from other modules z Statistical and real postings
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Posting to CO from Other Modules: Unit Objectives
At the conclusion of this unit, you will be able to:
z Name the typical feeder systems that post data to CO. z Explain the concept of commitment management within CO. z Name real and statistical controlling objects. z Explain the difference between real and statistical postings in CO.
SAP AG 2001
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Overview
$ t Reporting Tools
+ ABC
HR
Planning and Integrated Planning
MM
SD
FI AA
DM DM
CO 1
12
9 Posting to CO from$ Other Components Transaction-Based Postings in CO
OM PC Profit Representing Your Business in CO
CO
AC040
1 12 OM PC Profit FI CO
INT EXT OM PC Profit
Period-End Postings in CO
FI MM HR AA SD
Overview of Controlling
“Where now?"
Navigation SAP AG 2001
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Summary
ASAP: Introduction
Introduction
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Posting to CO from Other Modules: Enterprise Scenario z Your review now takes you to an analysis of how the transaction data finds its way into CO. This is done in conjunction with the auditors from the CPA firm who are attempting to document the data flow. z As you learned at the beginning of your assignment, FI is a primary source of data postings to CO. But as you dig deeper, you find that other application components are major contributors as well, such as MM, Asset Accounting, and HR. z You are also responsible for evaluating the use of real and statistical controlling objects in the transaction postings, based on information requirements. And you are required to explain to the auditors the use of commitments as a cost control tool.
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Posting to CO from Other Modules
At the conclusion of this unit, you will be able to: z Name the typical feeder systems that post data to CO. z Explain the concept of Commitment Management within CO.
SAP AG 2001
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Posting Logic
FI Data Entry: Item 001 - G/L Account 420000 (P&L) - Amount - Controlling Object Item 002 - G/L Account 113100 (Bal. Sheet) - Amount
FI Document # 1200000089 G/L Account 420000 (P&L)
G/L Account (Bal. Sheet) 113100
Amount
Amount
CO Document # 1000000009 Controlling Object Cost element (420000)
Amount
SAP AG 2001
When an
FI document is created that posts to an expense (or revenue) account using a corresponding cost element, a controlling document is also created
This
controlling document has an unique number and contains the following details:
y controlling object that was posted to y the cost element used y Amount In
the above example, the FI document debited a P&L account and credited a Balance sheet account. The CO document debited the controlling object (using the corresponding primary cost element of the same number). Note that there is no corresponding credit entry in the CO document.
When a
primary cost is initially posted into CO, it is treated as a one-sided journal entry, unlike a traditional balanced financial accounting journal entry. (Note that any transactions which create cost movements within CO, are balanced entries. When a cost is moved from one controlling object to another, such as from one cost center to another, the sending object is credited, and the receiving object is debited for the same amount.)
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True and Statistical Objects in CO Cost Origin MM
AA
FI
True Objects
CO
SD
Statistical Objects
Cost Center
Internal Orders
Statistical Order
Cost Object
Project
Statistical Project
Networks
Profitability Segment
.....
Profit Center .....
SAP AG 2001
You
can post costs and revenues in CO either as true postings, or statistical postings:
y You can settle true postings with other CO objects. y Statistical postings are for informational purposes only. The account
assignment object itself can either be a true or a statistical object. For example, an overhead cost order is defined as true or statistical when it is created. A true order takes only true postings, and a statistical order only statistical postings. Cost centers are an exception to this, always being true objects, but you can make statistical or true postings to them.
To
post costs in CO, you need to identify the corresponding true CO account assignment object in the source document (for example, an FI journal entry). Only one true object is allowed for each document item in the source document. Additional statistical objects can be entered or derived from the system.
True
objects can act as sending or receiving objects during cost allocation. Examples of true cost accounting objects are cost centers (for cost assignment), internal orders (true), projects (true), networks, orders for make-to-order production, cost objects and profitability segments.
Statistical objects
cannot allocate costs to other objects. You can make a statistical account assignment to any number of cost accounting objects. Statistical cost accounting objects include the following: Statistical orders, statistical projects and profit centers
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Posting from FI to a Cost Center
FI
Income statement account 403000 1000--
Balance sheet account 113100
Cost origin: Cost center XY
1000--
CO
Cost center Debiting under Cost element
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When a journal
entry is created in FI that includes an expense line item, that expense can be posted to CO as a cost if: - a primary cost element has been created in CO that corresponds to the expense account used in the FI journal entry, and - a valid cost center is referenced in the FI line item.
As
a result, two separate documents are created: a FI document and a CO document. Each document has a unique document number, and it is possible to drill down in either document to link to the other.
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Posting from FI to a Cost Center Depreciation on a machine
AA
FI
Cost origin: Cost center XY
Valuation adjustment
Depreciation ~~
Cost origin: Cost center XY
~~
CO
Cost Center XY Debiting under Cost element
SAP AG 2001
If
Asset Accounting initiates a transaction in FI that affects a P&L account for which a primary cost element has been created, a CO posting will also be created.
An
asset master record has a cost center field that can be used to assign the asset to a cost center.
Depreciation
and interest expense postings are examples of AA-initiated transactions that could generate cost postings to CO.
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Posting from HR to a Cost Center Payroll accounting
HR
Cost origin: Cost Center XY
FI
Salaries & other costs ~~
Salaries clearing account
Cost origin: Cost Center XY
~~
CO Cost Center XY Debiting under Cost element
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Payroll accounting in
Human Resources calculates the various salary and wage amounts. The system then generates FI postings and posts the costs to the cost centers to which the employees are assigned.
Employee
master data in HR can be assigned to infotypes. The infotype determines the company code, personnel area, and personnel subarea to which the employee is assigned. For example, Infotype 0001 Organizational Assignment enables you to determine the cost center to which personnel costs are debited, and to assign your employee to a business area.
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Posting from MM to a Cost Center Material issued from stock
MM
FI
Cost origin: Cost center XY
Material consumption ~~
Cost origin: Cost center XY
Material stock ~~
CO Cost Center XY Debiting under Cost element
SAP AG 2001
Goods
issue transactions posted in the Material Management component can be assigned to a cost center. An example could be parts issued to an R & D cost center for constructing a product prototype.
From the
aspect of the cost center, this type of transaction is called material consumption. When you enter a goods issue in the system, you must enter a movement type to differentiate between the various categories of goods movements. A movement type is an identification key which has important control functions in Inventory Management, such as updating stock and consumption accounts.
A
goods issue to a cost center creates an FI transaction that debits a material consumption expense account and credits a material stock (inventory) account. The cost center is debited with the value of the goods issued using a primary cost element.
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Posting MM Purchase Orders to a Cost Center
MM
Material Purchase Order with Vendor Purchaser: Cost center XY
FI
CO Cost Center XY Debiting under Cost element Commitment
SAP AG 2001
A
purchase order is a formal request from a purchasing organization to a vendor or a plant to supply or provide a certain quantity of goods or services at or by a certain point in time. A purchase order does not create an entry in FI. Each item in a purchase order can be assigned to a separate cost center (or other controlling object).
Once
posted, the purchase order record creates a "commitment" line item for the cost center entered on the purchase order item. The Information System can report on outstanding commitments for a given cost center.
Subsequently,
when actual costs are incurred (for example when the ordered goods are delivered), the R/3 System clears the commitment and posts the actual costs.
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Commitments MM
CO
Purchase requisition (with account assignment object)
Purchase 1 order
Cost center 3105: Sales, vehicles Celem
400000 ¦
Commit.
500 500
Actual Assigned
0 0
500 500
2
Goods receipt
Cost center 3105: Sales, vehicles Celem
400000 ¦
Commit.
0
Actual Assigned
500 500
500 500
SAP AG 2001
Commitments
for future costs are created in the Purchasing function of the Materials Management component as follows: - A purchase requisition is an internal procurement requirement (from the requestor to the buyer). A purchase requisition represents a provisional commitment, which can be changed at any time. You do not have to assign a CO object to a purchase requisition item, but if you do not do so, the commitment would not be represented in CO. - A purchase order on the other hand is a contractual agreement to purchase goods or services from a vendor according to agreed conditions. A purchase order is a firm commitment since it is based on a contractual agreement. If a purchase item is to be entered under a cost element, you need to enter a CO object. The item is then represented in CO.
When
you create a purchase order with reference to a purchase requisition, the commitment is reclassified in CO.
You
reduce the commitment by posting a goods receipt against a purchase order. Actual costs are posted to the CO object. This process continues until the purchase order is closed and the commitment is reduced to zero.
You
need to activate commitments management in CO for each controlling area.
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Statistical and Real Postings
At the conclusion of this topic, you will be able to: z Name Real and Statistical Controlling Objects. z Explain the difference between Real and Statistical postings in CO.
SAP AG 2001
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Posting to a Statistical Order
Income statement account FI
~~
Balance sheet account
Cost Origin: Cost Center XY Statistical Order 12
~~
Debit affecting costs
CO
Further Cost Objects Debiting under
Kostenstelle XY Debiting under
additional Cost element:
Statistical Order 12 - Profit Center (optional)
Cost element: - Real costs
SAP AG 2001
Statistical orders are
accounting.
typically used to evaluate costs which cannot be itemized in detail in cost center
In
this example, the FI document assigns the cost posting to both a cost center and a statistical internal order. The costs will then appear under the original cost element both on the cost center (real costs) and on the order (statistical, for information purposes only).
Statistical orders could
be created for individual trucks monitored in a motor pool cost center. Cost postings could be assigned to both the relevant order and the cost center. The real cost postings are accumulated on the cost center for the entire motor pool, whereas the individual orders retain the detail cost information for each vehicle.
Unlike
real internal orders, you can neither settle statistical orders, nor apply overhead to them.
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Posting to a Real Order
FI
Income statement account ~~
Balance sheet account
Cost origin: Order 123456
~~
CO Order
123456
Debiting under Cost element: - Real costs
Optional: Further cost objects
optional additional
Debiting under Cost element: - Real cost center - statistical project - Profit center - ...
SAP AG 2001
In
this example, the internal order is entered in the FI document as the account assignment object. The internal order is apparently a real object, which means that the cost posting is a real posting.
If
the FI document were to also specify a cost center as an account assignment object, the cost center would be updated statistically. When both a real internal order and a cost center are specified in the source document line item, the real posting is directed to the order, and statistical postings are recorded for the cost center and profit center.
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Posting to a Profitability Segment
FI
Income statement account 809000
Balance sheet account 113100
1500--
Cost origin: Profitability Segment X
1500--
Cost element: 809000
CO
Profitability Segment X •Customer: Miller •Sales org.: NW •Column: 03 Crediting under revenue element - real revenue
Optional: Further cost objects
optional additional
Crediting under stat. revenue element: - Real cost center - Profit center
SAP AG 2001
In
this example, there is a revenue posting to FI. If there is a primary cost element of type 11 (revenues) that corresponds to the revenue account, then the revenue will post to the appropriate profitability segment in CO-PA.
Real revenues can
only be posted to a profitability segment, customer order, customer project, or revenue order. As with cost postings, revenue postings to profit centers are statistical.
Additionally,
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revenues can be entered statistically to cost centers
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Posting to CO from Other Modules: Summary
Having completed this unit, you should now be able to: z Name the typical feeder systems that post data to CO. z Explain the concept of Commitment Management within CO. z Name real and statistical controlling objects. z Explain the difference between real and statistical postings in CO.
SAP AG 2001
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Exercises Unit: Posting to CO from Other Modules Topic: Postings from Other Modules
•
Check the account assignment logic and the posting concept in the R/3 System.
When business transactions are recorded in an application component such as FI or MM, the company wants to be sure that the corresponding cost data also gets transferred to CO without any extra data transfer or reconciliation runs. You enter business transactions in FI and MM to see how the system uses the corresponding account assignment logic to automatically transfer the information to CO. You also create a purchase order in MM to test commitment management in CO. You process CO reports to display these business transactions and drill down to access the source documents. 1-1
Post an expense in the General Ledger (FI) which is relevant to a cost center and check which costs are transferred into CO. 1-1-1 Create a G/L account posting with today’s date for the purchase of raw materials for the German company code (1000) in currency UNI. Enter a debit amount of 5000 for G/L account 403000. Specify that the offsetting credit is to be made to G/L account 113100. Which error message is displayed? In the G/L account master records, some of the expense accounts are configured to indicate that taxes may be associated with these accounts, but this setting is not mandatory. A tax warning message is thus issued by the system prior to the mentioned error message. This is to ensure that you do not forget to enter a tax code if appropriate. For the purpose of these exercises, all expenses are treated as nontaxable. Therefore, you can ignore the warning message. Note: You can enter tax code V0 (input tax, 0%) for this course. _________________________________________________________ _________________________________________________________ _________________________________________________________
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1-1-2 Enter SERV-## in the cost center field to charge the raw materials costs to your service cost center. Post the document. 1-1-3 Run the Cost Centers: Actual/Plan/Variance report for the current period and plan version 0. Run the report for the service cost center (SERV-##). 1-1-4 Drill down to the original document. 1-2
Record the consumption of a material by a cost center in Inventory Management (MM). Check which costs are transferred to CO. 1-2-1 Enter a goods issue for your service cost center (SERV-##). Use movement type 201 and get 20 pieces of material T-T200 from storage location 0001 in the Hamburg plant (1000). 1-2-2 Run the Cost Centers: Actual/Plan/Variance report for the current period and plan version 0. Run the report for the service cost center (SERV-##). 1-2-3 Drill down to the original document.
1-3
Create a purchase order for a cost center and check the resulting commitment in CO. 1-3-1 Create a purchase order for vendor 1000, purchasing organization 1000, purchasing group 001, and company code 1000. Specify that the purchase order is to be charged to a cost center (account assignment category K). Order 10 pieces of material T-T200, at a price of 50 for your service cost center, SERV-##. Enter today’s date as the delivery date. If the system issues warning messages because of the delivery date, you can ignore these. 1-3-2 Run the Cost Centers: Actual/Plan/Commitment report for the current period and plan version 0. Run the report for the service cost center (SERV). 1-3-3 Drill down to the original document.
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Unit: Posting to CO from Other Modules Topic: Statistical and True Postings
•
Compare a statistical posting to a true posting
The enterprise would like to use an overhead cost order to represent plant maintenance and operating costs for a truck that is assigned to a cost center. However, settlement should not be requirement for seeing the costs at cost center level as they are incurred. Create a statistical order to achieve this. Since the costs on the order are only statistical, they can be analyzed at the detailed order level but cannot be allocated to the cost center. However, since the actual costs are posted simultaneously to the cost center, you can also make your analysis at this level. 2-1
Create a statistical order for a truck used by the service cost center, SERV-##. Create the overhead cost order with order type 1000. Name the order TRUCK-## and add Truck ## to the defaulted description. Assign the order to business area 9900 and profit center 1400. Activate the indicator for the statistical order and save your order.
2-2
Enter a G/L account expense posting and assign it to your statistical order to determine the information that is required to execute this transaction completely. Analyze the results in CO. 2-2-1 Create a G/L account posting for the vehicle costs of your truck, for the current date. Use the German company code (1000) for this and the UNI currency. Enter a debit amount of 4000 on G/L account 475000 for your truck order TRUCK-##. Specify that the offsetting credit is to be made to G/L account 113100. Which error message is displayed? _________________________________________________________ _________________________________________________________ 2-2-2 Enter SERV-## in the cost center field to charge the “true” vehicle costs to your service cost center. Post the document. 2-2-3 Run the Cost Centers: Actual/Plan/Variance report for the current period and plan version 0. Run the report for the service cost center (SERV-##). Check whether the cost posting for cost element 475000 is represented. 2-2-4 Run the Cost Centers: Actual/Plan/Variance report for the current period and plan version 0. Run the report for the your truck order (TRUCK-##). Check whether the cost posting for cost element 475000 is represented.
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Solutions Unit: Posting to CO from Other Modules Topic: Postings from Other Modules
•
Check the account assignment logic and the posting concept in the R/3 System.
When business transactions are recorded in an application component such as FI or MM, the company wants to be sure that the corresponding cost data also gets transferred to CO without any extra data transfer or reconciliation runs. You enter business transactions in FI and MM to see how the system uses the corresponding account assignment logic to automatically transfer the information to CO. You also create a purchase order in MM to test commitment management in CO. You process CO reports to display these business transactions and drill down to access the source documents.
1-1
Enter an expense in the General Ledger. 1-1-1 Enter a G/L account posting. In the G/L account master records, some of the expense accounts are configured to indicate that taxes may be associated with these accounts, but this setting is not mandatory. A tax warning message is thus issued by the system prior to the mentioned error message. This is to ensure that you do not forget to enter a tax code if appropriate. For the purpose of these exercises, all expenses are treated as nontaxable. Therefore, you can ignore the warning message. Note: You can enter tax code V0 (input tax, 0%) for this course. Accounting o Financial Accounting o General Ledger o Document Entry o G/L Account Posting Enter the current date in the Document date field. If the system displays the Enter company code dialog box, enter 1000 in the company code field. Enter UNI in the Currency field. In the G/L account field, enter 403000 in the first row. In the Dr/Cr field, enter debit.
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In the Dr field, enter the tax indicator V0. Enter 5000 in the Amount document currency field. In the G/L account field, enter 113100 in the second row. In the Dr/Cr field, enter credit. Enter 5000 in the Amount document currency field. Select Enter. Select enter to clear tax warning message. The system displays the error message “Account 403000 requires an assignment to a CO object.” 1-1-2 Enter SERV-## in the cost center field to charge the raw materials costs to your service cost center. Post the document. Enter SERV-## in the Cost center field. (To find the cost center, you need to scroll to the right in the debit row.) Select Enter. Select Save. Note down the document number assigned by the system. 1-1-3 Run the Cost Centers: Actual/Plan/Variance report. Accounting o Controlling o Cost Center Accounting o Information System o Reports for Cost Center Accounting o Plan/Actual Comparison o Cost Centers: Actual/Plan/Variance. Enter 1000 in the Controlling area field. Enter the current fiscal year in the Fiscal year field. Enter the current period in the From period field. Enter the current period in the To period field. Enter 0 in the Plan version field. Enter SERV-## in the first Or value(s) field. Select Execute. 1-1-4 Drill down to the original document. Double-click on the report line for cost element 403000. Double-click on the Cost Centers: Actual Line Items report. Double-click on the line item with a value of 5000. A Financial Accounting document is displayed (the G/L account posting). Alternatively, you can place the cursor on the line item and choose Environment -> Accounting documents to see all the accounting documents that were created.
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1-2
Record the consumption of a material by a cost center in Inventory Management (MM). 1-2-1 Enter a goods issue for your service cost center (SERV-##). Logistics oMaterials ManagementoInventory ManagementoGoods MovementoGoods Issue Enter 201 in the Transaction type field. Enter 1000 in the Plant field. Enter 0001 in the Storage location field. Select Enter. Enter SERV-## in the Cost center field. Enter T-T200 in the Material field. Enter 20 in the Quantity field. Choose Post. 1-2-2 Run the Cost Centers: Actual/Plan/Variance report. Accounting o Controlling o Cost Center Accounting o Information System o Reports for Cost Center Accounting o Plan/Actual Comparison o Cost Centers: Actual/Plan/Variance. Enter 1000 in the Controlling area field. Enter the current fiscal year in the Fiscal year field. Enter the current period in the From period field. Enter the current period in the To period field. Enter 0 in the Plan version field. Enter SERV-## in the Or value(s) field. Select Execute. 1-2-3 Drill down to the original document. Double-click on the report line for cost element 400000. Double-click on the Cost Centers: Actual Line Items report. Double-click on the line item with a quantity of 20 pieces. A Material document is displayed (the goods issue document). Alternatively, you can place the cursor on the line item and choose Environment -> Accounting documents to see all the accounting documents that were created.
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1-3
Create a purchase order for a cost center. 1-3-1 Create a purchase order for vendor 1000. Logistics o Materials Management o Purchasingo Purchase Ordero Createo Vender/Supplying Plant Known On the right-hand side of the shopping basket symbol, choose Standard PO. Enter 1000 in the Vendor field. Click on the Header symbol (if not opened out). Choose the Org. data tab page (if not already selected). In the Purchasing org. field, enter 1000 (IDES Germany). Enter 001 in the Purch. group field. Enter 1000 in the Company code field (IDES AG) Click on the Item overview symbol (if not opened out). Enter a K in the Account assignment category field (in the K column). Enter T-T200 in the Material field. Enter 10 in the PO quantity field. Enter the current date in the Delivery date field. Enter 50 in the Net price field (UNI per l). Enter 1000 in the Plant field. Choose Enter. If a warning is displayed for the delivery date, choose Enter again to remove the warning. Enter SERV-## as the cost center. Choose Save. 1-3-2 Run the Cost Centers: Actual/Plan/Commitment report. Accounting o Controlling o Cost Center Accounting o Information System o Reports for Cost Center Accounting o Plan/Actual Comparisons o Additional Key Figures o Cost Centers: Actual/Plan/Commitment Enter 1000 in the Controlling area field. Enter the current fiscal year in the Fiscal year field. Enter the current period in the From period field. Enter the current period in the To period field. Enter 0 in the Plan version field. Enter SERV-## in the Or value(s) field. Select Execute.
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1-3-3 Drill down to the original document. Double-click on the report line for cost element 400000. Double-click on the Cost Centers: Commitment Line Items report. Double-click on the line item. The system displays the PO document.
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Unit: Posting to CO from Other Modules Topic: Statistical and True Postings
•
Compare a statistical posting to a true posting
The enterprise would like to use an overhead cost order to represent plant maintenance and operating costs for a truck that is assigned to a cost center. However, settlement should not be requirement for seeing the costs at cost center level as they are incurred. Create a statistical order to achieve this. Since the costs on the order are only statistical, they can be analyzed at the detailed order level but cannot be allocated to the cost center. However, since the actual costs are posted simultaneously to the cost center, you can also make your analysis at this level.
2-1
Create a statistical order for a truck. Accounting o Controlling o Internal Orders o Master Data o Order Manager Click on the Create icon. Enter 1000 in the Order type field. Enter TRUCK-## in the Order field. Enter Truck ## at the end of the text in the Short text field. Enter 9900 in the Business area field. Enter 1400 in the Profit center field. Choose the Control tab page. Click on the Statistical order box. (This field may already be activated.) Choose Save.
2-2
Enter a G/L account expense posting. 2-2-1 Create a G/L account posting. Accounting o Financial Accounting o General Ledger o Document Entry o G/L Account Posting Enter the current date in the Document date field. If the system displays the Enter company code dialog box, enter 1000 in the company code field. Enter UNI in the Currency field.
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In the G/L account field, enter 475000 in the first row. In the Dr/Cr field, enter debit. Enter 4000 in the Amount document currency field. In the Dr field, enter the tax indicator V0. Enter TRUCK-## in the Order field. In the G/L account field, enter 113100 in the second row. In the Dr/Cr field, enter credit. Enter 4000 in the Amount document currency field. Select Enter. The system displays the error message “Account 475000 requires an assignment to a CO object.” 2-2-2 Enter SERV-## in the cost center field to charge the “true” vehicle costs to your service cost center. Enter SERV-## in the Cost center field. Select Enter. The message disappears and the document is now complete. Choose Save. 2-2-3 Run the Cost Centers: Actual/Plan/Variance report. Accounting o Controlling o Cost Center Accounting o Information System o Reports for Cost Center Accounting o Plan/Actual Comparison o Cost Centers: Actual/Plan/Variance. Enter 1000 in the Controlling area field. Enter the current fiscal year in the Fiscal year field. Enter the current period in the Period field. Enter the current period in the To period field. Enter 0 in the Plan version field. Enter SERV-## in the Or value(s) field. Select Execute. 2-2-4 Execute the Order: Actual/Plan/Variance report. Accounting o Controlling o Internal Orders o Information System o Reports for Internal Orders o Plan/Actual Comparisons o Orders: Actual/Plan/Variance. Enter 1000 in the Controlling area field. Enter the current fiscal year in the Fiscal year field. Enter the current period in the From period field. Enter the current period in the To period field. Enter 0 in the Plan version field. Enter TRUCK-## in the first Or value(s) field. Choose Execute. © SAP AG
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Transaction-Based Postings In CO: Contents
z Postings in Overhead Cost Controlling z Postings in Cost Object Controlling z Postings in Profitability and Sales Accounting z Example Posting for Transfer Prices
SAP AG 2001
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Transaction-Based Postings in CO: Unit Objectives Having completed this UNIT, you should now be able to: z Post CO Reposting documents. z Post a direct Activity Allocation. z Set up a budget for an overhead order. z Create different types of orders and post various transactions involving them. z Explain the purpose and use of transfer prices
SAP AG 2001
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Overview
$ t Reporting Tools
+ ABC Planning and Integrated Planning
HR
MM
FI
SD AA
CO CO 1
DM DM
Posting to CO from Other Components 9
12
$
Transaction-Based Postings in12 CO 1
OM PC Profit Representing Your Business in CO
AC040
OM PC Profit FI CO
INT EXT OM PC Profit
Period-End Postings in CO
FI MM HR AA SD
Overview of Controlling
“Where now?" Navigation
SAP AG 2001
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Summary
ASAP: Introduction
Introduction
AC040
8-3
Transaction-Based Postings In CO: z As your review continues, you move into the area of actual transactions. The first major category involves postings that are made in conjunction with a particular business transaction. z You find that there are several CO transactions in this category. They range from correcting postings that assigned the wrong CO object, to the allocation of activities (and associated costs) performed by cost centers. z Other transaction-based business transactions that you analyze include time entry by employees, as well as several functions related to the production process. z As you anticipated, Management is particularly interested in the availability control functions that serve to monitor spending for overhead orders.
SAP AG 2001
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Transactions related to Overhead Cost Controlling
At the conclusion of this topic, you will be able to: z Post CO Reposting documents. z Explain the purpose of a direct activity allocation. z Post a direct activity allocation. z Explain the purpose of entering time sheets. z Describe the steps in time sheet processing.
SAP AG 2001
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Reposting Line Items
FI
CO
Kunde C Kunde B Kunde A
Document no. 30012 473000 10,000
CCtr 2100
CCtr 2100
473000
113100 -10,000
10,000 -10,000
CCtr 2200 473000 10,000 Doc. no. 30012
SAP AG 2001
You
can repost primary costs from one controlling object to another using transaction-based reposting. The original cost element is retained. This function enables you to correct posting errors. Posting errors should preferably be corrected in the application component in which they occurred, so that external accounting (FI) and internal accounting (CO) are always reconciled. If this is not possible, incorrect assignments to controlling objects (cost centers or internal orders) can be corrected using transaction-based reposting in CO.
There are two types
of reposting: manual reposting of costs (or revenues) and reposting of line items:
y Manual reposting of costs simply transfers costs from one controlling object to another. This type of reposting does not preserve a direct link between the amount transferred and the transaction that originally posted the costs to CO. y When you repost line items, on the other hand, you specify the FI document number. The reposting document contains a reference to the original FI document. This means that the link to the original document from FI is preserved after the correction posting, and thus the receiver of the reposting can jump directly to the FI document. You
can specify more than one receiver when you repost line items.
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Direct Activity Allocation
10 hrs
Cost center development
3 hrs
Activity
Production cost center
Customer service cost center
5 hrs
Orders, projects, . .
SAP AG 2001
For
indirect actvitiy allocation, the quantity of an activity type provided by a cost center is entered and allocated.
For
a direct activity allocation, you require the cost center providing the activity (sender cost center), the object receiving the activity (receiver), the type of activity provided and the activity quantity. Note that the sender in an activity allocation can only be a cost center. The receiver, however, can be any controlling object, for example, a cost center, order or a project.
Direct
activity allocation credits the sender cost center and debits the receiver cost center using a secondary cost element (cost element category 43). This cost element is already stored in the activity type master record. The activity allocation value is obtained by multiplying the provided quantity with the planned price of the period.
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Time Sheet Time Sheet
Personnel number Date
000001 Max Müller 01.01.2001 - 31.12.2001
Rec. CCtr
Total
3200 AC040
37.00 38.00 24.00 14.00
Week 12.2001
Monday Tuesday Wednes. Thursday Friday 8.00 8.00 5.00 3.00
8.00 9.00 6.50 2.50
8.00 8.50 4.00 4.50
8.00 7.50 7.50
5.00 5.00 1.00 4.00
z Single entry point into R/3
z Approval process
z Use of templates and defaults
z Audit trail
z Easy-to-use multiple entry screen
z Flexible via user exits
SAP AG 2001
The R/3
component time sheet simplifies standardized, cross-application time entry. The time entry functions already available in several applications are summarized in a single transaction. The time sheet provides information about working time spent on the following applications: y Attendance and absence in Human Resources (HR) y Internal activity allocation in Controlling (CO) y Confirmations from Plant Maintenance (PM), Project System (PS) and Service Management (SM) y Entry of activities provided in External Services Management (MM-SRV)
Internal
employees and external service providers can use the time sheet to enter their working time in the system. There is also a screen to enable central time entry for all persons. The time entry interface is easy to use.
Working time
is always entered in hours or times, and is always person-related. In the R/3 System, a personnel number is assigned to every internal employee or external service provider. You can then create the minimum master record required, if you do not use the HR component.
Users call
up the time sheet via specific data entry profiles. When you create these profiles in Customizing, you can adjust the data entry transaction for the information status and the user task. There is a field selection function for the data entry profiles that allows you to select the fields that appear on the data entry screen.
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Budget Management
Order: 400010
Original Budget
Current Budget
Total
40,000
50,000
2001 2002 2003 2004
20,000 15,000 2,000 3,000
25,000 18,000 3,000 4,000
Budget Line Items Order
400010
Chicago Trade Fair
Document Year
Type
030000001 2001
Original
030000200 2001
Supplement
7,000
030000306 2001
Return
2,000-
Total
2001
Amount ... 20,000
25,000
SAP AG 2001
The system recognizes the following budget
types for internal orders:
y Original budget – the budget originally allocated y Budget updates – include supplements and returns for cases where unforeseen events make it necessary to correct the original budget y Current budget – the original budget plus all updates In
addition to updating the budget, you can also make changes to the original budget. You can lock the original budget using status management. To do this, you create a user status that does not allow budgeting but does allow supplements and returns.
When
you allocate or update a budget, this transaction is documented in an item. You can display the budget items from the budget screen. To facilitate the budget process, you can enter explanatory text for the budget items.
You
must define a number range for your budget documents in Customizing. The existing standard number range 04 is used to assign a number range to order budgeting.
When
you save the budget, the system checks whether the sum of the annual values matches the total value of the order.
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Availability Check
Order
Budget profile 000001
Budget
Total 2001 2002 2003 2004
100 20 30 30 20
Variances Profile 000001 000001
Activity ALL ALL
Action Warning with mail Error messages
% 100 110
Budget Manager
SAP AG 2001
The budget
profile controls the availability check in addition to other budgeting parameters.
In
the budget profile, you can specify when the availability check should be activated. The availability check can be run against the annual value or the total value of the budget.
Tolerance
limits control how the system reacts to budget variances. If the budget has been consumed, as in the example (100%), a warning is issued and a mail is sent to the budget manager. If the budget variance is 10% (110%), the R/3 System issues an error message and the transaction that would result in a variance cannot be posted. Tolerance limits are defined separately for each budget profile. You can set different tolerance limits for different actions.
If
you select the action Warning with mail, you must specify a budget manager in Customizing. If no budget manager is defined, the system generates an error message.
You
can exclude particular cost elements from the availability check.
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Easy Cost Planning & Execution Services (1) Easy Cost Planning Costing Structure
Value
50,160
IT Measure Labor hour Setup/Foreman Additional costs - concept Office supplies
10,000
IT: Concept IT: Nellos Concept Personnel time (H)
120
Additional costs (UNI)
13,400
5,000 13,400 945
Process work scheduling
1,440
Additional costs - project
24,175
Confirm
Confirm Cost Estimate: IT Measure Cat.
Res.
Plant /Act.
UM
Price
Value
Cost Element
4290
1421
84
H
10,000
8,400
E
4290
1426
36
H
5,000
1,800
611000
13,400
466000
V
Worklist
Quantity
E
M
DPC9051
P
300900
B
1300
1200
1
LE
13,400
619000
5
ST
189
945
400000
120
ST
12
1,440
629900
1
LE
24,175
24,175
466000
SAP AG 2001
Easy Cost
Planning & Execution Services is an additional tool that makes it easier to enter data into the system. It is available from Release 4.6C.
With
the Execution Services feature, the system automatically proposes the data to be posted.
The proposed data
is based on the data that you entered with the Easy Cost Planning tool.
This
planning method corresponds to planning using unit costing. However, you can predefine quantity structures (costing models) and have the quantity of resources depend on the allocation bases being planned (cost drivers). For example, you could have the system propose the resource quantities of the quantity structure based on the personnel time and the additional costs you enter.
The tool
works in the following sequence:
y Definition of costing models as predefined quantity structures that depend on allocation bases (cost drivers) y Easy Cost Planning using these costing models y Actual costs recorded using Execution Services on the basis of the planned data
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Templates for Easy Cost Planning
IT:Nellos Concept
Characteristics Characteristics
CA
PS_PERS_HOURS
Personnel time (H) Additional costs (UNI)
PS_ADD_COST
Confirm
Template
ZPS001
Item Cat.
Quantity
Object
Activation
Price
Internal activity
CCtr
4290
/ AType 1421
PS_PERS_HOURS * 0.7
Active
From CO-OM
Internal activity
CCtr
4290
/ AType 1426
PS_PERS_HOURS * 0.3
Variable
CstElem
Material
Plant/Material
466000 1200
/ AU DPC9051
Active
From CO-OM
1
Active
PS_ADD_COST
5
Active
From MM
SAP AG 2001
You
can predefine quantity structures for Easy Cost Planning using costing models (planning forms technically called templates).
In
the template of the costing model, you can control quantities, prices, and the activation of the entry by means of formulas or conditions.
As
a variable for these formulas/conditions, you can use characteristics that are assigned to the costing model. When you plan costs later, you only need to enter the values of these characteristics to plan the corresponding quantities of all resources.
You
can modify the entry screen of the costing model in HTML format.
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Easy Cost Planning & Execution Services (2) Execution Services Costing Structure
Value
IT Measure
50,160
Service Service Selection Selection Execution
Service:
CO
Internal Activity Allocation
10,000
Labor hours
Reservation
5,000
Setup/Foreman Additional costs - concept Office supplies
13,400
Purchase Requisition
945
Process work scheduling
1,440
Additional costs - project
24,175
PP
Goods Issue MM
Purchase Order
Reverse
Post
Documents
Internal Activity Allocation: IT Measure Cat.
Worklist
Description
Cost Ctr
ActType
BProcess Quantity
E
Labor hours
4290
1421
1421
84
E
Setup/Foreman
4295
1426
1426
36
E
Work scheduling
300900
120
Unit
Posting Date
H
03/23/2001
H
03/23/2001
PC
03/23/2001
SAP AG 2001
You
can record commitments and actual costs using Execution Services. The system automatically proposes the resources and quantities that you previously defined with Easy Cost Planning, in accordance with the selected service.
The following postings
are supported:
y Internal activity allocations (for internal activities) y Direct process allocations (for processes) y Reservations (for material items) y Goods issues (for material items) y Purchase requisitions (for material items, external activity items, service items, variable items) y Purchase orders (for material items, external activity items, service items, variable items)
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Transactions Relevant to Cost Object Controlling
At the conclusion of this topic, you will be able to: z Describe the functions of Cost Object Controlling z Name the most important cost objects z Create a production order z Post the documents necessary to record the consumption of activities and materials
SAP AG 2001
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Product Cost Controlling Order-related Product Cost Controlling
Periodic Product Cost Controlling
Work place 2
Production line
Production line
Sales order-related Controlling
Production order lot size Work place 1
Warehouse Product Cost Collector
Work place 3
Warehouse Production Order
Production Order
Warehouse Sales order SD
SAP AG 2001
Order-related
Product Cost Controlling supplies information about production orders, whose costs are to be settled to the inventory, to Cost Object Controlling. In this scenario the order quantity is of particular importance to Cost Object Controlling, as the planned order costs are calculated on the basis of this quantity value and actual costs can only be calculated once the final delivery of this quantity has been made. The actual costs for internal activities and materials are collected for each production order and can be compared with the planned order costs as well as the results of the material cost estimate.
In
contrast to order-related product cost controlling, where costs are analyzed according to lots, periodic product cost controlling allows you to analyze costs by period. Here, costs are collected and analyzed over a specific time period using a product cost collector. By using a product cost collector you can collect product costs regardless of production type. Production costs can be collected in the same product cost collector for each period regardless of the production environment (order-related production, process manufacturing or mass production).
Sales Order-related
Controlling uses sales order items as cost objects, whereby you can calculate costs and revenues for both plan and actual data. Sales Order-related Controlling can be used in the following situations: y In-house production for a sales order y Provision of services where costs are to be assigned to a sales order.
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Cost Accounting at Order Level
PP
Production order 1
Production order 2
Production order 3
Goods Issues Confirmations Goods receipts
Goods Issues Confirmations Goods receipts
Goods Issues Confirmations Goods receipts
Debit: Material 2,400 $ Production 700 $ O/H costs 300 $ 3,200 $ Credit:
Debit: Material 3,600 $ Production 900 $ O/H costs 400 $ 4,800 $ Credit:
Debit: Material 1,200 $ Production 500 $ O/H 100 $ 1,700 $ Credit:
Material
CO-PC
SAP AG 2001
In
Product Cost Controlling at order level, production orders are the cost objects. The costs debited to the orders are normally analyzed and settled in lots. This means that variances can only be analyzed once the whole production quantity has been delivered to the inventory.
Product
Cost Controlling at order level enables you to do the following:
y Calculate and analyze the plan, target and actual costs for production orders and process orders. y Calculate the work in process (WIP) using actual costs. y Calculate and analyze variances y Transfer data to Financial Accounting (FI), Profitability Analysis (CO-PA), Profit Center Accounting (EC-PCA) and to Actual Costing/Material Ledger (CO-PC-ACT) When
you create a production order, a preliminary costing is immediately carried out for calculating the planned costs of the order.
Actual
costs are incurred when raw materials from the warehouse and activity types from cost centers are consumed. You can also post primary costs directly to the production order. The order can also be debited with incurred overheads. You can post process costs by allocating process quantities using a template.
Since the different types
of actual costs are posted simultaneously with the consumtion of materials or services to the productin order, you can call up and analyze the costs for the production order at any time.
When finished
goods are delivered to the warehouse, the inventory value of the warehouse is debited and the order is credited.
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Cost Controlling at the Product Level
PP
Production Order
Production Order
Production Order
Goods Issues Confirmations Goods Receipts
Goods Issues Confirmations Goods Receipts
Goods Issues Confirmations Goods Receipts
Material
Product Cost Collector
COPC
Debit: Material Production Overhead
$1,200 800 200
Credit:
$2,100
SAP AG 2001
To track costs
at the product level, you create a product cost collector for each product. A product cost collector is a cost object in Product Cost by Period that collects the actual costs incurred during the production of a material in each period. When you use a product cost collector, the product is the main cost object.
Product
cost collectors can be used in any production environment. This means that actual costs can be collected on product cost collectors in the following production environments: order-related production, process manufacturing, or repetitive manufacturing.
Actual
costs can be allocated to and from product cost collectors as follows:
y In transactions in logistics (such as goods issues or confirmations) for manufacturing orders (production orders or process orders) and run schedule headers. Example: Goods issues for a production order or reporting point confirmations in repetitive manufacturing debit the product cost collector with actual costs. Goods received from production credit the product cost collector. y Directly through G/L account postings in FI You
can see the actual costs on product cost collectors in the information system at any time.
During period-end
closing, you can:
y Allocate process costs to product cost collectors using templates y Revaluate activities with actual prices y Determine overhead costs for product cost collectors y Calculate the value of the unfinished goods (work in process) for the period using target costs y Calculate the variances for the period y Allocate the work in process and variances to other application components © SAP AG
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Typical Activities in Cost Object Accounting
CO
Material1 100 pcs
Goods withdrawal from the warehouse
Cost object selection Cost estimate
Plan costs
Actual costs
Activity allocation/ backflushing/overhead rate/process allocation
Delivery settlement
Process Non-stoc k 10 pcs
INVOICE
Warehouse/ Sales order stock
External purchase of goods and services
SAP AG 2001
Although the activity output processes differ from enterprise to enterprise or among different industries with regards to logistics, they are all similar for controlling purposes. Regardless of the activity output process (product or service for example), the following steps are always part of the procedure: preliminary costing, simultaneous costing and final costing. Therefore, Product Cost Controlling can be regarded as a type of "tool box" containing many cost objects and functions. You choose the most appropriate cost object and functions according to your cost accounting goals and the data (quantity structures) that you can provide. The result is your cost object accounting for the analyzed activity output process. You might choose a different cost object for another activity output process (product group or service for example), so you would get a different scenario. Regardless of the scenario that you want to have, the basic steps are always as follows: yFirst you select the cost objects that are most appropriate where functions or integration is
concerned. You can use many of these cost objects in combination, for example, production order with sales order, customer project with assigned networks and production orders.
yFor most of the cost objects, you can calculate the costs and save these as plan values on the cost
object. If the cost object has status management, it must be released before you can make actual postings to the cost object.
yThe sequence of the actual postings is not predefined. Instead, it is derived from the business
transactions. In this way, for example, you can withdraw the required materials (possibly with reference to a bill of material) from the warehouse first.
yThe activity output process can consume internal activity from cost centers, which you can
manually post by means of the time sheet or confirmation.
yPurchased external activity or externally procured goods can lead to goods and invoice receipts
that are assigned on the cost object.
yYou can allocate overhead rates and processes as periodic transactions. © SAP AG
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yIf products are completed, they can be delivered to the warehouse. This normally credits the cost
object accordingly.
yAt the end of the period, you can determine WIP, calculate accrual on the cost objects and/or
calculate variance (final costing) depending on the cost object type.
yAt the end of the period, you settle the cost object.
These basic steps are always processed in a similar way for each cost object, and can almost be seen as the "core process". In this training course, two activity output processes will be executed: Firstly, the production of goods followed by delivery to warehouse and finally direct sale. After this, the service is provided (assembled on location).
© SAP AG
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Process Chain: Order-Related Manufacturing
Order archived/deleted Settlement Variance calculation Goods receipt
Order request Order creation
Header
Availability check
OPERATIONS OPERATIONS
MATERIAL MATERIAL COMPONENTS COMPONENTS
Release of order WIP calculation
PROD. PROD. RESOURCES/TOOLS RESOURCES/TOOLS
COSTS COSTS
Overhead
PLAN PLAN TARGET TARGET ACTUAL ACTUAL
100
20 50
Shop paper printing Material withdrawal
Revaluate at actual prices Allocate process quantities
Confirmations
SAP AG 2001
The production process
is order-related production. Since we want to derive the quantity structure from BOMs and routings, we decide to use PP production orders as the cost objects. The illustration shows the typical process chain for this: y The order request can come from Sales & Operations Planning (SOP), which is described in the unit on integrated planning. You can transfer the SOP data into the production plan. The planning run can generate a planned order that can then be converted into a production order. The order request could also be based on an external request. During the planning run, the system also checks the availability of the required raw materials and semifinished products. If not enough materials are available, the system can also create additional planned orders that can then be converted into production orders, purchase requisitions, or purchase orders. y When the order is created, a preliminary cost estimate is generated (although not always, such as in repetitive manufacturing) that calculates the planned costs for the order. The planned costs can be updated if the order is changed. y Actual costs can be assigned to the order once it is released. Actual costs are registered when material is withdrawn for the order and when confirmations are generated that document the consumption of activity types. You can also post primary costs directly to the production order. Shop papers are printed out for the shop floor. y Once the production process is complete, the work in process is delivered to stock. Partial deliveries are possible at any time during the production process.
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Delivery to Stock Resource Allocation
Cost Object Cost Object
Goods Issue
CONFIRMATION
EXTERNAL PROCUREMENT EXTERNAL ACTIVITIES
Plan
Actual
Glass
1,500
1,800
Plugs
2,000
2,200
Cable
500
600
Material
4,000
4,600
Production
2,500
2,800
Overhead
1,500
1,600
Process costs
1,000
1,500
Total costs
9,000
10,500
Delivery value
9,000
Order balance
1,500
GOODS RECEIPT
SAP AG 2001
After
final delivery, all costs remaining on the order are allocated to inventory or to a price difference account. The order is then fully credited.
If
the price control indicator in the material’s master record is set to S (standard price), the difference between the actual costs and the credit postings for inventory receipts is charged to a price difference account. This recalculates the moving average price and updates it for statistical purposes.
If
the price control indicator in the material’s master record is set to V (moving average price), the difference between the actual costs and the credit postings for inventory receipts is charged to the material stock account. This recalculates the total warehouse stock value and the moving average price.
If
at the time of settlement the warehouse stock is less than the order quantity because goods were issued in the meantime, the following events take place: y The costs for the remaining warehouse quantity are posted to the material’s stock account. y The remaining costs are automatically posted to a price difference account.
If
the material ledger is active, the delivery is also posted to the material ledger and can then be used to calculate an actual material price at the end of the period.
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Relevant Transactions for Profitability and Sales Accounting
At the conclusion of this topic, you will be able to: z Create a sales order z Post the documents that are required to record the costs of goods issues z Make revenue postings using the billing function in the SD component
SAP AG 2001
© SAP AG
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Selling Goods and Services z
Sales order
99
A customer orders 99 pumps, which we will deliver from unrestricted stock
Item 10 99 pumps
z
Item 20
The customer wants us to install the pumps in his plant
Installation onsite
SAP AG 2001
A
sales order is used for the sale of our pumps from the warehouse. As this sale does not represent an activity output process, this sale will be completed using a sales order line item that is not a cost object (controlled using Customizing settings). This means that costs and revenues can not be assigned to this sales order item (Item 10 is not a cost object).
However,
completing the service installation onsite is an activity output process, that will be assigned directly to the sales order. In order to allow Controlling to be used for this sales order item, it must be opened as a cost object in Customizing. This means that the costs, and later revenues, can be posted directly to the sales order item (item 20 is a cost object).
© SAP AG
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Steps in Sales Order Processing
Customer
FI
4
Payment 2
1
SD
Sales order
Process chain Logistics
1
1
3
Delivery 1
Billing
1
t
SAP AG 2001
In
an efficient order processing system, all activities related to the customer are integrated processes. The R/3 component SD (Sales and Distribution) meets this criterion. In this component, documents are introduced through a workflow and are interlinked with each other. The workflow in the the SD component starts with the processes preceding the actual sale, and ends when the customer’s payment for the goods and services is processed. These processes are based on electronic documents, whereby each document is linked to the document preceding or following it in the workflow. These documents can be viewed directly from the sales order with the Display document flow function.
To start the order
processing workflow, you create a sales document. The sales order can be preceded by a customer inquiry and quotation.
A
delivery document is created when the product is delivered, and a billing document is created when the customer is invoiced. From the point of view of Controlling, the time point of the billing document is the time point of the revenue realization.
When the customer
pays, you post the payment in FI.
The documents defined
your customers.
© SAP AG
in the R/3 component simplify the administration of sales orders for you and
AC040
8-24
Transferring Sales Order Receipts to CO-PA COPA (accrued)
ECPCA
Quantity Revenue Bonus COS
+ + + +
Acct. CO-PA
FI
SD Quantity flow
1
Customer Order 1
t
SAP AG 2001
You
can valuate incoming sales orders (as expected revenues) and transfer them from SD to CO-PA to enable an early analysis of possible profits. This enables you to create reports that in turn enable you to analyze contribution margins based on the sales orders received.
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Delivery and Billing Quantity Revenue Bonus COS
COPA (costing-based)
ECPCA
COS X
Acct. CO-PA
Inventory X
FI
1
SD Quantity flow
Sales order
2
Delivery
+ + + +
Revenue X Rebate X Customer X
3
Billing
t
SAP AG 2001
When
data is posted to FI, it is also transferred to account-based CO-PA at the same time. This means that when accounting documents for goods issues and billing are created, the system generates corresponding line items in CO-PA. Note that a line item is created for each cost and revenue element in CO-PA. The number of these receiving line items is the same as the number posted in FI. No line items are created for incoming orders here, since such orders do not trigger postings in FI.
The values in account-based
CO-PA are assigned to profitability segments and saved in the cost or revenue element specified in the MM component (for goods issues) or in the SD component (for billing documents). The data can only be transferred to account-based CO-PA if the G/L account in FI is defined as a cost or revenue element in CO (for more information, see the notes for the general posting logic in Controlling).
A
billing document usually completes a businsess transaction in SD. The billing data is sent to FI automatically, where the revenue and receivables postings are made at the same time.
When the
billing document is created, SD uses pricing procedures to calculate all revenues, sales deductions, and other data (such as standard costs), and stores this data in condition types. What happens next depends on whether the sales order is a cost object: y If the sales order on which the billing is based is not a cost object, these condition types are assigned to the value fields in costing-based profitability analysis and posted to CO-PA automatically. y If the sales order on which the billing is based is a cost object, the revenues are assigned to the sales order.
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Selling Goods and Services - without Sales Order Controlling
Sales order
Profitability Analysis Billing Document
Item 10
CO-PA
99 pumps
Material costing COPC
Cost Object
Cost of Goods Sold
Variances
SAP AG 2001
First
sales order item (Item 10):
y The first item is related to products, which we produce in a make to stock environment. The production process is controlled by a production order, which delivers the finished goods to warehouse unrestricted stock, for sale at a later time. y In this case, the sales order item is not a cost object. y Since the sales order item is not a cost object in this scenario, the revenues will be transferred directly to profitability analysis (CO-PA) when the billing document is created. The cost of goods sold can be calculated using Valuation. The valuation can access a cost estimate that was already created in Product Cost Planning and, for example, copy the calculated cost of goods manufactured for the goods sold. y Variances between the cost of goods manufactured and the actual costs for the production order can be transferred to CO-PA during production order settlement.
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Selling Goods and Services - with Sales Order Controlling Billing Document
Sales order
SD
Acty
Allocation
CCtr
Profitability Analysis CO-PA
Goods receipts
MM CO Object Item 20 Installation onsite
Order Settlement Invoice
External activities
SAP AG 2001
Second sales
order item (Item 20):
y The second item is related to a service, which we provide at the customer’s location. It entails installing the pumps that were sold in sales order item 10. y In this case, the sales order item is a cost object. y An order specific cost estimate can exist for the cost object. In this case a sales order cost estimate exists, whose results have then been saved as planned values for the sales order. y Cost incurred by providing the service will be directly assigned to the order item, for example cost center activities used, consumption of materials from the warehouse or externally procurred goods and services. y The revenues generated by the billing process will also be posted to the sales order item. y Costs and revenues are transferred to profitability analysis when the cost object is settled. y It is possible to execute periodic results analysis for the cost object. In this case, the results analysis data is transferred to CO-PA and not the posted costs and revenues.
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Transfer Prices
At the conclusion of this topic, you will be able to: z Explain the significance of multiple valuation for EC-PCA z Explain the concept of transfer prices in ECPCA
SAP AG 2001
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Transfer Prices in Profit Center Accounting 150
Profit Center 1
Transfer Price 150
Profit Center 2
Profit Center Accounting
Production order
Material
120 FI/CO Logistics
Parallel value flow Quantity flow
SAP AG 2001
If
the material ledger is productive, you can carry up to three valuations for your materials (provided you have made the necessary customizing settings). These valuations are called legal valuation, group valuation, and profit center valuation.
You
can define transfer prices for profit center valuation.
When a
goods movement takes place between two profit centers, this is treated as a "sale" by Profit Center Accounting, and the quantity flow is valuated with the transfer price. y If the sale takes place within a company code, the sending profit center can realize a profit or a loss, while in legal valuation this is not possible. y If the sale takes place between company codes, the sending profit center can realize a profit or a loss that deviates from that of the legal valuation.
The above
illustration shows that the production order in profit center 2 uses a particular quantity of raw material whose inventory is assigned to profit center 1. The consumption of the raw material thus represents an internal "sale" by profit center 1 to profit center 2. In profit center valuation, this sale is valuated with a transfer price.
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Example for Transfer Prices
Profit Center Accounting
Profit Center 1
Profit Center 2
Internal revenue: - 150
Material consumption
Cost of sales Inventory
150
+ 120 - 120 Production order
Material
120 FI/CO Logistics
Parallel value flow Quantity flow
SAP AG 2001
The following example
illustrates what happens when a product is sold within a company code:
y Suppose a production order in profit center 2 uses a particular quantity of raw material whose inventory is assigned to profit center 1. The consumption of the raw material represents an internal "sale" by profit center 1 to profit center 2. y A transfer price of 150.00 has been defined in profit center valuation, while the inventory value of the raw material is only 120.00. So while profit center 1 receives revenue of 150.00 when the material is sold, there is also a "cost of sales" for the internal inventory change resulting from this sale. y The receiver cost center posts expenses of 150.00. From its point of view, this is the "purchase price" for the material.
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Transaction-Based Postings In CO: Summary Having completed this UNIT, you should now be able to: z Post CO Reposting documents. z Post a direct Activity Allocation. z Explain the purpose, and process, of entering time sheets. z Set up a budget for an overhead order. z Explain the purpose and use of transfer prices
SAP AG 2001
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Exercises Unit: Transaction-Based Postings In CO Topic: Reposting
•
Use the reposting function to correct postings to the wrong CO object by other components such as FI
The accountant assigned the wrong posting object during an FI posting. You would like to correct this without reversing the FI posting.
1-1
Enter the FI posting. 1-1-1 Create a G/L account posting for the consumption today of operating supplies and consumables for the German company code (1000) in currency UNI. Enter a target amount of 1000 for G/L account 403000 (input tax code V0) and assign the posting to the SERV## service cost center. Specify that the offsetting credit is to be made to G/L account 113100. Post the document. 1-1-2 Run the Cost Centers: Actual/Plan/Variance report for the current period and plan version 0. Run the report for the service cost center (SERV-##) to check whether the posting for cost element 403000 was correct or not.
1-2
Repost (without reference to the FI document) costs from the service cost center to the production cost center. 1-2-1 Use the entry variant cost center. Repost 500 of the operating supplies and consumables costs from the service cost center (SERV-##) to your production cost center (PROD-##). The cost element is 403000. Post your document. 1-2-2 Process the report Cost Centers: Actual/Plan/Variance for the current period and plan version 0. Run the report for the service cost center (SERV-##) and for the production cost center (PROD-##). Check that the service cost center was credited with the amount 500 and the production cost center was debited with this amount.
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Unit: Transaction-Based Postings In CO Topic: Direct Allocations
•
Analyze the combined quantity and value flow of a direct activity allocation
The service cost center has provided a quantity of activity for the production cost center. Through the direct activity allocation in CO, you record the flow of the activity quantity and associated costs between the cost centers.
2-1
Your service cost center spent 50 hours inspecting the assets of your production cost center. The detected damages of some assets were repaired with 90 hours repair activity. An activity report (paper document) is now passed to the internal accounting department. You process the activity allocation using this information, and check the consequences that this has for your service cost center. 2-1-1 Create a direct activity allocation to allocate 50 hours of activity type CHK## and 90 hours of activity type REP-## from cost center SERV-## to cost center PROD-##. Use the entry variants cost center and list entry. Post your document. 2-1-2 Process the report Cost Centers: Actual/Plan/Variance for the current period and plan version 0. Run the report for the service cost center (SERV). Check the quantity and cost flows from of the service cost center to the production cost center.
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Unit: Transaction-Based Postings In CO Topic: Cross-Application Time Sheet
•
Use the cross application time sheet
Before now, the employees in your enterprise used paper documents for time entry, which was then entered in the system by the internal accounting department. This information is to be entered online by the employees in future. The information can them be transferred to CO to update cost accounting.
3-1
Create an entry using the cross-application time sheet and transfer the information to CO. Check the result on the service cost center. 3-1-1 You use the cross-application time sheet with the data entry profile CO to record the repair activity REP-## that your employee with the personnel number 10## provided for the production cost center PROD-##. The key date is today. The sender cost center is SERV-## and the employee has provided a repair service today, that lasted 8 hours. Switch to the release view, select your entered row and choose the Release button. Save the time entry. Note: in some countries it may be necessary to use the personnel number 70##) 3-1-2 Since your entered activity does not require approval according to the settings in the entry profile, you can update the time sheet data directly. For your entry date, transfer the time sheet data accordingly to CO only. Use the personnel number of your employee (10##) for the selection and note down the CO document number. 3-1-3 Process the report Cost Centers: Actual/Plan/Variance for the current period and plan version 0. Run the report for the service cost center (SERV). Call up the report Cost Centers: Actual Line Items for the allocation cost element 615000 and drilldown to the source document.
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Unit: Transaction-Based Postings In CO Topic: Availability Control for Internal Orders
•
Check the budgeting and availability control for overhead orders
To assure that the overhead orders are not over-spent, the company has decided to approve a budget for an order and set up controls to warn the user if an order comes near to or exceeds the budget limit.
4-1
Enter an original budget for the current fiscal year for your trade fair order (for the order number, see the data sheet). Specify a budget of 20000.
4-2
Enter a G/L account posting for the purchase today of raw materials for company code 1000 in currency UNI. Enter a target amount of 19500 for G/L account 400000 (input tax code V0) and assign the posting to your trade fair order. Specify that the offsetting credit is to be made to G/L account 113100. Post the document and note the budget warning message. (Note: You must release the order before you can post actual costs to your trade fair order). If you are unsure of the order status, check it first. _________________________________________________________
4-3
Enter another G/L account posting for the purchase today of raw materials for company code 1000 in currency UNI. Enter a target amount of 3000 for G/L account 400000 and assign the posting to your trade fair order. Specify that the offsetting credit is to be made to G/L account 113100. Post the document and note the budget warning message. _________________________________________________________ Repeat exercise 4-3 to post another 3000 UNI to your order. How does the system react?
4-4
© SAP AG
The instructor will display the mail messages that were automatically issued by the availability control settings.
AC040
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Unit: Transaction-Based Postings In CO Topic: Transactions Relevant to The Cost Object
•
Create a production order and analyze the preliminary costing.
•
Perform typical postings to a production order
The company produces a certain material. They have depicted the logistics process as make-to-stock manufacturing using BOMs, routings and PP-production orders. The company has decided to base production on lot sizes. This is supported in R/3 Controlling by Product Cost by Order.
Requirement: Ensure that you have enough warehouse stock for your consumption materials. In this scenario, you use several materials from the warehouse for producing your product. Normally, you decide when purchasing these materials between in-house production or external procurement. To shorten the procurement transaction, we are going to use the movement type 561 to post a goods receipt without reference to a purchase order. Proceed as follows: Create a goods receipt posting from the Logistics menu (Materials Management – Inventory Management). Enter movement type 561, plant 1000 and storage location 0001. On the entry screen for materials T-B1##, T-B2##, T-B3## and T-B4##, enter 300 pieces for each. Note: You can save time by choosing Other goods receipts -> Create with reference -> To BOM from the list screen and entering the material T-F1## and the quantity 300. Post the goods receipt. 5-1
Create a PP production order and check the information that was automatically defaulted in the order. 5-1-1 From the logistics menu for production control, create a PP production order for material T-F1## in plant 1000. The production order type is PP01. The production lot size is 100 pieces. Enter the last work day of this month as the end date, or use the current date as the scheduling type. 5-1-2 From the component overview, check the components that were copied from the BOM into the production order. Also, check the operations in the operation overview that were copied from the routing.
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5-1-3 From the production order header, review the control information. What are the relevant fields for costing? _________________________________________________________ _________________________________________________________ _________________________________________________________ 5-1-4 Check the settlement rule. What has been defined as the receiver? _________________________________________________________ 5-1-5 Release the production order and then save it. Record the order number in your data sheet. To release the order, select the symbol Release order.. To save the order, select the save symbol. _________________________________________________________ 5-2
From the information system of Product Cost by Order, call up the detailed report for orders and analyze your production order from exercise 5-1-5 with the cost development layout (1SAP02). Change the layout by inserting the cost element field after the origin (text) field, and then save this layout as GR## and user-specific as your future default setting.
5-3
From inventory management, post the goods issue for the material components reserved for the order. Use movement type 261, plant 1000 and storage location 0001. Reference the reservation list. Enter the number of the production order from exercise 5-1-5. Transfer all the reserved materials and change the quantity of the goods issue for the second item from 100 to 101 pieces. Post the goods issue.
5-4
From the information system of Product Cost by Order, call up the detailed report for orders and analyze your production order from exercise 5-1-5 with your layout GR##.
5-5
After each operation, the shop floor control can confirm completion to record the output quantities and the actual activity quantities consumed by the operation. You can confirm activity from the production control menu. During a confirmation entry, it is possible for the system to execute automatic goods movement transactions. The routing for material T-F1## has been maintained so that when the last operation is confirmed, the system automatically processes the goods receipt for the finished product. These material movement transactions create a credit posting on the production order. Confirm progress or partial completion for the last operation (60) of the production order. Since this is a milestone operation, the preceding operations are be automatically confirmed using the planned execution times adjusted for the actual confirmed quantity (target = actual confirmation). Confirm only 40 finished products without any scrap, but increase the proposed activity quantities (execution times) by approximately 10%. (The activity quantities are being intentionally changed to create a variance).
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5-6
Review the actual costs posted to the production order due to the confirmation. Additional actual costs should have been incurred by the production activities, and a credit posting should have been made for the delivered quantity of 40 pieces. From the menu, call up the detailed report with your layout GR##.
5-7
Additional costs have been incurred for the production order as well as the costs for the normal production activities and goods issue transactions. In Financial Accounting (FI), post primary costs directly to the order. The additional costs were incurred by an unexpected external service, which was necessary to complete the production process. Enter a G/L account posting for the purchase and immediate consumption of material for company code 1000 in the UNI currency. Enter a target amount of 1000 for G/L account 410000 (tax code V0) and assign the posting to your production order from exercise 5-1-5. Specify that the offsetting credit is to be made to G/L account 113100. Post the document.
5-8
Check the actual costs that were posted to the production order by the FI posting. From the menu, call up the detailed report with your layout GR##.
© SAP AG
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Unit: Transaction-Based Postings In CO Topic: Goods Sales
•
You get to know the process of selling goods from the warehouse using a sales order.
The company receives an order from a customer to deliver pumps.
6-1
Create a sales order for the customer using the T-F1## material as the first sales order item. 6-1-1 Create a standard order (OR) for sales organization 1000 (Frankfurt). Enter 10 as the sales channel and 00 as the division. Sold-to party and ship-to party is the Becker company in Berlin (1000). The order number is 1000##. The customer has ordered 100 pieces of material T-F1## (pumps). Choose Enter and accept the system’s delivery default for the schedule line. 6-1-2 Check the pricing conditions for the pumps. 6-1-3 Check the account assignment for the pumps to display the settlement rule for settlement to Profitability Analysis. Save the sales order and note down the document number. _________________________________________________________
6-2
Process a delivery to ship the pumps from the sales order created in exercise 6-1 to the customer. Deliver the goods from shipping location 1000 (Hamburg). Enter the selection date as two weeks from today. Commission 40 pumps from storage location 0002 and post a goods issue to represent the transaction in accounting. Note down the delivery document number. _________________________________________________________
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6-3
Bill the customer for the pumps and check the accounting documents that are created. 6-3-1 After the goods have been delivered, create the billing document for the sales document item. The number of the delivery document was automatically defaulted. If it has not been defaulted, enter the number of your delivery document. Note down your billing document number and the billing date. ______________________________________________________ ______________________________________________________ 6-3-2 Display the billing document. Go to the overview of the accounting documents and analyze the accounting document, the profit center document and the profitability analysis document. Note the transferred characteristics and the used value fields for the profitability analysis document.
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Solutions Unit: Transaction-Based Postings In CO Topic: Reposting
•
Use the reposting function to correct postings to the wrong CO object by other components such as FI
The accountant assigned the wrong posting object during an FI posting. You would like to correct this without reversing the FI posting.
1-1
Enter the FI posting. 1-1-1 Enter a G/L account posting. Accounting o Financial Accounting o General Ledger o Document Entry o G/L Account Posting Enter the current date in the Document date field. If the system displays the Enter company code dialog box, enter 1000 in the company code field. Enter UNI in the Currency field. In the G/L account field, enter 403000 in the first row. In the Dr/Cr field, enter debit. Enter 1000 in the Amount document currency field. In the Dr field, enter the tax indicator V0. In the Cost center field, enter SERV-## in the first row. In the G/L account field, enter 113100 in the second row. In the Dr/Cr field, enter credit. Enter 1000 in the Amount document currency field. Select Enter. Choose Post.
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1-1-2 Run the Cost Centers: Actual/Plan/Variance report. Accounting o Controlling o Cost Center Accounting o Information System o Reports for Cost Center Accounting o Plan/Actual Comparison o Cost Centers: Actual/Plan/Variance. Enter 1000 in the Controlling area field. Enter the current fiscal year in the Fiscal year field. Enter the current period in the From period field. Enter the current period in the To period field. Enter 0 in the Plan version field. Enter SERV-## in the first Or value(s) field. Select Execute. 1-2
Repost the costs without a reference to the FI document. 1-2-1 Repost an amount of 500 for the auxiliary and consumable costs. Accounting o Controlling o Cost Center Accounting o Actual Postings o Manual Reposting of Costs o Enter Enter cost center in the Screen variant field. Choose List entry. Enter SERV-## in the Send. CCtr field. Enter 403000 in the Cost elem. field. Enter 500 in the Amount field. Enter UNI in the Currency field. Enter PROD-## in the Rec. CCtr field. Choose Post. 1-2-2 Run the Cost Centers: Actual/Plan/Variance report. Accounting o Controlling o Cost Center Accounting o Information System o Reports for Cost Center Accounting o Plan/Actual Comparison o Cost Centers: Actual/Plan/Variance. Enter 1000 in the Controlling area field. Enter the current fiscal year in the Fiscal year field. Enter the current period in the From period field. Enter the current period in the To period field. Enter 0 in the Plan version field. Enter SERV-## in the Or value(s) field. Select Execute. Run the report again for cost center PROD-##.
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Unit: Transaction-Based Postings In CO Topic: Direct Allocations
•
Analyze the combined quantity and value flow of a direct activity allocation
The service cost center has provided a quantity of activity for the production cost center. Through the direct activity allocation in CO, you record the flow of the activity quantity and associated costs between the cost centers.
2-1
Direct Activity Allocation 2-1-1 Create a direct activity allocation. Accounting o Controlling o Cost Center Accounting o Actual Postings o Activity Allocation o Enter Enter the current date in the Document date field. Enter 0 in the Version field. Enter cost center in the Screen variant field. Choose List entry. In the first row: - Enter SERV-## in the Send. CCtr. Column. - Enter CHK-## in the ATyp column. - Enter PROD-## in the Rec. CCtr column. - Enter 50 in the Total qty Column. In the second row: - Enter SERV-## in the Send. - Enter REP-## in the ATyp column. - Enter PROD-## in the Rec. CCtr column. - Enter 90 in the Total qty Column. Choose Post.
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2-1-2 Run the Cost Centers: Actual/Plan/Variance report. Accounting o Controlling o Cost Center Accounting o Information System o Reports for Cost Center Accounting o Plan/Actual Comparison o Cost Centers: Actual/Plan/Variance. Enter 1000 in the Controlling area field. Enter the current fiscal year in the Fiscal year field. Enter the current period in the From period field. Enter the current period in the To period field. Enter 0 in the Plan version field. Enter SERV-## in the Or value(s) field. Select Execute. If you scroll to the end of the report, you can see the quantities of the activity type allocation.
© SAP AG
AC040
8-45
Unit: Transaction-Based Postings In CO Topic: Cross-Application Time Sheet
•
Use the cross application time sheet
Before now, the employees in your enterprise used paper documents for time entry, which was then entered in the system by the internal accounting department. This information is to be entered online by the employees in future. The information can them be transferred to CO to update cost accounting.
3-1
Create an entry using the cross application time sheet and transfer the information to CO. 3-1-1 Accounting o Controlling o Cost Center Accounting o Actual Postings o Time Sheet o Time Data o Enter. Enter CO in the Entry profile field. Enter 10## in the Personnel no. field. Select Enter times. Enter SERV-## in the Send.CCtr. field. Enter REP-## in the ATyp column. Enter PROD-## in the Rec. CCtr field. In the column containing the current date, enter 8. Choose the symbol Release view that is displayed at the lower edge of the screen. Select your entry row by clicking on the button to the left of the row, and then choose the Release symbol in the function bar at the upper screen edge. Select Save. Go back to the main menu. 3-1-2 Transfer the time sheet information you entered only to CO. Accounting o Controlling o Cost Center Accounting o Actual Postings o Time Sheet o Transfer o Accounting. Enter 10## in the Personnel no. field. Enter the current date in the Date field.
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Enter the current date in the Posting date field. Select Execute. The system displays a log with a message informing you that a document has been posted. 3-1-3 Run the Cost Centers: Actual/Plan/Variance report. Accounting o Controlling o Cost Center Accounting o Information System o Reports for Cost Center Accounting o Plan/Actual Comparison o Cost Centers: Actual/Plan/Variance. Enter 1000 in the Controlling area field. Enter the current fiscal year in the Fiscal year field. Enter the current period in the From period field. Enter the current period in the To period field. Enter 0 in the Plan version field. Enter SERV-## in the Or value(s) field. Select Execute. Double-click on the report row for cost element 615000. Double-click on the Cost Centers: Actual Line Items report. Double-click on the line item with the quantity 8- .
© SAP AG
AC040
8-47
Unit: Transaction-Based Postings In CO Topic: Availability Control for Internal Orders
•
Check the budgeting and availability control for overhead orders
To assure that the overhead orders are not over-spent, the company has decided to approve a budget for an order and set up controls to warn the user if an order comes near to or exceeds the budget limit.
4-1
Enter an original budget for the current fiscal year. Accounting o Controlling o Internal Orders o Budgeting o Original Budget o Change Enter your production order number in the Order field of your trade fair order. Select Enter. Enter 20000 for your order budget for the current fiscal year. Select Save.
4-2
Enter a G/L account posting. If you want to check whether your trade fair order has been released, choose the following: Accounting o Controlling o Internal Orders o Master Data o Special Functions o Order o Change Enter your order number, and choose Master data. Choose the Control tab page. If the order has not been released, choose Release to the right of the System status field. The status changes and is now “FREE”. You may use a base planning object, T-SERVICE, which contains a template of the planned costs for the pump installation service. To continue with the G/L accounting posting, choose the following: Accounting o Financial Accounting o General Ledger o Document Entry o Enter G/L Account Document.
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Enter the current date in the Document date field. If the system displays the Enter company code dialog box, enter 1000 in the company code field. Enter UNI in the Currency field. Enter 403000 in the G/L acct. field. In the Dr/Cr field, enter debit. Enter 19500 in the Amount document currency field. In the Dr field, enter the tax indicator V0. Enter your production order number in the Order field of your trade fair order. Enter 113100 in the G/L acct. field. In the Dr/Cr field, enter credit. Enter 19500 in the Amount document currency field. Select Enter. Select Save. Note the budget warning message. Choose Enter to clear the warning message. Remain in the G/L Account Posting screen for the next exercise: The warning message indicates that your order budget is almost used up. 4-3
Enter another G/L account posting. Enter the current date in the Document date field. Enter 403000 in the G/L acct. field. In the Dr/Cr field, enter debit. Enter 3000 in the Amount document currency field. In the Dr field, enter the tax indicator V0. Enter your production order number in the Order field of your trade fair order. Enter 113100 in the G/L acct. field. In the Dr/Cr field, enter credit. Enter 3000 in the Amount document currency field. Select Enter. Select Save. Note the budget warning message. Choose Enter to clear the warning message. The warning message indicates that your order budget has been exceeded for the current fiscal year. If you repeat exercise 4-3 and thus post another amount of 3000, the system displays an error message.
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4-4
The course instructor demonstrates the mail messages. If you want to look yourself: Office o Work Center o Inbox Choose Unread documents. You only receive messages if you have entered yourself as the budget manager in Customizing.
© SAP AG
AC040
8-50
Unit: Transaction-Based Postings In CO Topic: Transactions Relevant to The Cost Object
•
Create a production order and analyze the preliminary costing.
•
Perform typical postings to a production order
The company produces a certain material. They have depicted the logistics process as make-to-stock manufacturing using BOMs, routings and PP-production orders. The company has decided to base production on lot sizes. This is supported in R/3 Controlling by Product Cost by Order.
Requirement: Ensure that you have enough warehouse stock for your consumption materials. In this scenario, you need to use several materials from the warehouse for producing your product. Normally, you decide when purchasing these materials between in-house production or external procurement. To shorten the procurement transaction, we are going to use the movement type 561 to post a goods receipt without reference to a purchase order. Proceed as follows: Create a goods receipt posting from the Logistics menu (Materials Management – Inventory Management). Enter movement type 561, plant 1000 and storage location 0001. On the entry screen for materials T-B1##, T-B2##, T-B3## and T-B4##, enter 300 pieces for each. Note: You can save time by choosing Other goods receipts -> Create with reference -> To BOM on the list screen and entering the material T-F1## and the quantity 300. Post the goods receipt. 5-1
Create a PP production order and check the information that was automatically defaulted in the order. 5-1-1 Create a PP production order for the T-F1## material. Logistics o Production o Production Control o Order o Create o With material Enter material T-F1##. Enter production plant 1000. Enter order type PP01.
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Select Enter. Enter 100 in the Total quantity field. Enter the last work day of this month as the end date, or use the current date as the scheduling type. Select Enter. 5-1-2 Check the components that were copied from the BOM into the production order. In addition, check the operations in the operation overview. Select the Component overview icon. Select the Operation overview icon. 5-1-3 What are the relevant fields for costing? Choose the header icon. On the header screen, choose the Control tab page. The fields that are relevant for the costing are in the Costing group box. These fields are costing variant plan, costing variant actual, costing sheet, overhead key, RA key, and variance key. 5-1-4 Check the settlement rule. Choose Header o Settlement rule. The T-F1xx material has been defined as the settlement receiver. 5-1-5 Release the production order and then save it. Do this by clicking on the Release icon and then the Save icon. 5-2
From the information system of Product Cost by Order, call up the detailed report for orders and analyze your production order from exercise 5-1-5 with the cost development layout (1SAP02). Controlling o Product Cost Controlling o Cost Object Controlling o Product Cost by Order o Information System o Reports for Product Cost by Order o Detailed Reports o For Orders Enter the order number from exercise 5-1-5, choose Cumulated time frame, and then execute the report. Choose the layout Cost development (1SAP02). Change the layout by inserting the cost element field after the origin (text) field, and then save this layout as GR## and user-specific as your future default setting.
5-3
Post the goods issue for the material components reserved for the order. Logistics oMaterials ManagementoInventory ManagementoGoods MovementoGoods Issue Enter movement type 261. Enter Plant 1000. Enter storage location 0001. Choose To Reservation and enter the number of the production order. (You can also enter the reservation number if you have already looked it up in the production order). Choose Continue.
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Choose all the items and transfer them. Change the quantity of the second item from 100 to 101. Save the goods issue. Choose Enter to clear any warning messages that may be displayed. 5-4
From the information system of Product Cost by Order, call up the detailed report for orders and analyze your production order from exercise 5-1-5. Controlling o Product Cost Controlling o Cost Object Controlling o Product Cost by Order o Information System o Reports for Product Cost by Order o Detailed Reports o For Orders Enter the order number from exercise 5-1-5, choose Cumulated for the time frame, and then execute the report. If required, choose your layout, GR##. Actual values should be listed for the cost elements for the components.
5-5
Execute a partial completion confirmation for the last operation (60) of the production order. Logistics o Production o Production Control o Confirmation o Enter o For Operation o Progress Confirmation. Enter the order number and select operation 60. Select Enter. Choose Partial confirmation. Enter a yield to be confirmed of 40, and increase the default personnel time by approximately 10%. Save the confirmation.
5-6
Review the actual costs posted to the production order due to the confirmation. Controlling o Product Cost Controlling o Cost Object Controlling o Product Cost by Order o Information System o Reports for Product Cost by Order o Detailed Reports o For Orders Enter the order number from exercise 5-1-5, choose Cumulated for the time frame, and then execute the report. If required, choose your layout, GR##. Actual values should be displayed for the cost elements of the activity types and components, as well as for the delivery to the warehouse.
5-7
For the current date, enter another G/L account posting for the purchase and immediate consumption of material. Accounting o Financial Accounting o General Ledger o Document Entry o G/L Account Posting Enter the current date in the Document date field. Enter UNI in the Currency field.
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Enter 410000 in the G/L acct. field. In the Dr/Cr field, enter debit. Enter 1000 in the Amount document currency field. In the Dr field, enter the tax indicator V0. Enter your production order number in the Order field. Enter 113100 in the G/L acct. field. In the Dr/Cr field, enter credit. Enter 1000 in the Amount document currency field. Select Enter. Select Save. 5-8
Check the actual costs that were posted to the production order by the FI posting. Controlling o Product Cost Controlling o Cost Object Controlling o Product Cost by Order o Information System o Reports for Product Cost by Order o Detailed Reports o For Orders Enter the order number from exercise 5-1-5, choose Cumulated for the time frame, and then execute the report. If required, choose your layout, GR##. Actual values should be displayed for the cost elements of the components, activity types and consultant activity, as well as for the delivery to the warehouse.
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Unit: Transaction-Based Postings In CO Topic: Goods Sales
•
You get to know the process of selling goods from the warehouse using a sales order.
The company receives an order from a customer to deliver pumps.
6-1
Create a sales order for the customer. 6-1-1 Create the sales order for the pumps as the first sales order item. Logistics o Sales & Distribution o Sales o Order o Create Enter OR (standard order) in the Order type field. Enter 1000 in the Sales organization field. Enter 10 in the Distribution channel field. Enter 00 in the Division field. Select Item overview. Enter 1000 in the Sold-to party field. Enter 1000 in the Ship-to party field. Enter 1000## in the Purchase order no. field. Enter T-F1## in the Material field. Enter 100 in the Order quantity field. Select Enter. The system makes a schedule line. Choose Delivery proposal to transfer the delivery proposal of the system. 6-1-2 Check the pricing conditions for the pumps. Select the item (click on the item number). To check the conditions, select the corresponding row and choose the symbol Conditions item displayed at the lower screen edge.
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6-1-3 Check the account assignment for the pumps. Select the Account assignment tab. Select Save. Go back to the initial screen for order creation for the next exercise. 6-2
Execute a delivery in the system to deliver the pumps to the customers. Go back to the standard menu. Select Order o Subsequent Functions o Delivery. Enter 1000 in the Shipping point field. Enter the current date + 2 weeks in the Selection date field. Ensure that your sales order number is in the Order field. Select Enter. Enter 40 in the Picked quantity field. Select Post goods issue. Note down the delivery number.
6-3
Bill the customer for the pumps and check the accounting documents that are created. 6-3-1 After the goods have been delivered, create the billing document for the sales document item. Logistics o Sales and Distribution o Sales o Order o Subsequent Functions o Billing Document. The number of the delivery document was automatically defaulted. If it has not been defaulted, enter the number of your delivery document. Select Save. Note down your billing document number and the billing date. 6-3-2 Check the accounting documents created for the billing document. Select Billing document→Display. Enter the billing document number. Select Accounting overview. Go to the accounting documents, profit center document and profitability analysis document by clicking. In the profitability analysis document you can see the characteristics and value fields: On the Characteristics tab page, the transferred characteristics values On the Value fields tab page, the list of value fields. Use the Next page and Previous page to display the data transferred to profitability analysis for this sale. Go back to the billing document.
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Period-End Postings in CO: Unit Contents
z Overhead Cost Controlling z Cost Object Controlling z Actual Costing/Material Ledger z Profitability Analysis z Schedule Manager z Reconciliation Ledger
SAP AG 2001
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Period-End Postings: Unit Objectives
Having completed this unit, you should be able to: z Post statistical key figures, perform an assessment of costs, and settle an overhead order. z Allocate overheads and assign process costs to an order, deliver materials to stock, calculate WIP and variances, and settle an order. z Explain the purpose of the Reconciliation Ledger and execute appropriate reports. z Explain period-end closing activities
SAP AG 2001
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Overview
$ t Reporting Tools
+ ABC
HR
MM
FI
SD AA
DMDM
Planning and Integrated Planning Postings to CO from Other Components
1 OM
OM PC Profit Representing Your Business in CO
CO
AC040
INT EXT
FI
CO 1
12
9
$
Transaction-Based 12 in CO Postings
PC Profit CO
Period-End Postings in CO
OM PC Profit FI MM HR AA SD
Overview of Controlling
“Where now?"
Navigation SAP AG 2001
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Summary
ASAP: Introduction
Introduction
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Period-End Postings in CO: Business Scenario
z As you continue your review, you find that many transactions in CO involve postings performed at the end of each accounting period. z Again, you discover that many of the period end postings involve allocations. The purpose of these allocations is to correctly assign overheads to their corresponding location. As you explain to your employees, these period-end closing activities follow a particular sequence, and are intended to provide accurate periodic operating results to management.
SAP AG 2001
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Overhead Cost Controlling
At the conclusion of this topic, you will be able to: z Post statistical key figures to a cost center z Distribute cost center costs from one cost center to several others by means of assessment z Settle an internal order to a cost center
SAP AG 2001
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Postings of Statistical Key Figures
Periods
1
2
3
. . . 12
Cat. 1
Employees
20
20
20
20
Cat. 2
Counter no.
1300
1355
1275
1325
Posting Period
SAP AG 2001
Statistical key figures
are used for calculations in the information system, and are the basis for period-based allocations. You can, for example, use the key figure Employees to create reports on personnel costs for each employee, or to distribute the costs by means of assessment that are incurred on the Cafeteria cost center to all cost centers that use the cafeteria.
You
create statistical key figures as master data records. When you do this, you need to assign the master record to one of two possible categories: Key figures for fixed values or key figures for total values. You use a statistical key figure for fixed values (category 1) to post values that are valid from the posting period through all following periods of the current fiscal year. Only once you change the value, do you need to post the statistical key figure again. A key figure for total values (category 2) is required for posting values that are only valid in the posting period. You need to make a new posting for this in each new posting period.
You
can, however, also assign statistical key figures to a cost center or activity type. This is useful for cost splitting.
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Transferring Statistical Key Figures from the LIS Statistical key figure: Number of purchase orders
Shipping no.: 1 - 1000 4000 purchase orders
Material no.:* Purchasing org.:* ...
Cost Center Production 1
LIS Ship. No. 0005 0100
Purch. Orders 1500 2500
SAP AG 2001
The values of
key figures maintained in the Logistics Information System (LIS) can be used in Controlling as statistical key figures. You can then use these values in your cost allocations.
The following prerequisites must
be met:
y The LIS must be active. y You must create statistical key figures in CO and link them to the corresponding key figure in the LIS. y You must specify the assignment of the key figures to the corresponding cost centers in Customizing. Statistical key figures
independent values.
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can be transferred to Cost Center Accounting as activity-dependent or activity-
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Periodic Activities in Overhead Cost Controlling Cost Centers Processes
Sending
Orders
Cost allocations
Quantity allocations (activity & process)
- Accruals (on CCtr only) - Periodic reposting - Distribution - Assessment - Overheads - Order settlement
- Indirect (with defined sender quantity) - Indirect (with non-defined sender quantity - retroactive) - Target = Actual - Template allocation
Cost Centers Projects
Receivers
Orders
SAP AG 2001
There are several
methods available for periodic allocations in Overhead Cost Controlling.
Pure
cost allocations are used to move costs from sender objects to receiver objects. This is known as a value flow. It is possible to include a quantity flow in the cost allocation. The type of cost element used for allocation (primary or secondary) of costs depends on the allocation type.
Activity allocations
can also be used in the periodic allocation process. In activity allocation, a quantity flow always takes place. This refers to the quantity of the different activity units. An additional value flow takes place either immediately, or can be calculated at the end of the period. Activity allocation is always executed using an allocation cost element.
If
Activity-Based Costing is activated, you can make periodic template allocations using templates, also based on quantity with an additional value flow.
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Periodic Cost Allocation - Methods
Method
Technique
z Accruals
z Costing Sheet
z Overheads
z Costing Sheet
z Periodic Reposting
z Cycle / Segment
z Distribution
z Cycle / Segment
z Assessment
z Cycle / Segment
SAP AG 2001
In
R/3, existing tools are normally used as often as possible to enable the user to put their acquired skills for this tool into practice as often as possible, and thus avoid having to be trained for new skills. This means that there are mainly only two tools in the periodic transactions for Overhead Cost Controlling that are always used: the costing sheet and the cycle/segment method. y The costing sheet always starts with basic values, to which overheads are then applied. y The cycle/segment method however, represents relationships between senders and receivers. Allocations are made between these senders and receivers using certain rules.
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Accrual Costs
FI
FI Expense/yield = Costs/revenue
COCEL
COOM
COCEL
Accrued costs: - Accrued vacation bonus - Depreciation
Method: z Overhead method z Target=actual method
COOM
SAP AG 2001
Operating expenses
are often posted differently in FI than in CO. This means, for example, that an FI expense posting in a posting period can be for an entire year.
To avoid
periodic cost fluctuations in Cost Center Accounting that are caused by payment flows for specific periods, these costs can be "attributed" to the relevant periods of time. Costs that are created in this way are also known as accrued costs. This type of cost can be posted in two different ways: y By a recurring entry transaction in FI and cost transfer to CO. y By calculating the accrual value in CO using the costs posted there.
When
you calculate the accrual value in CO, you can choose one of the following methods:
y Percentage method y Target=actual method
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Accrual Calculation: Percentage Method Jan
Wage costs
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
20,000 20,000 20,000
....
....
....
....
....
....
....
....
20,000
2,000 2,000 2,000
....
....
....
....
....
....
....
....
2,000
Rules for the periodic percentage method Accrued vacation bonus (10% of wage costs)
Paid vacation bonus: 24,000
Accrual cost object (Cost center or order) Period
Accrual costs and
01 02 03 04 05 06 ... 12
-
2,000 2,000 2,000 2,000 2,000 2,000
-
2,000
effective actual costs
+ 24,000
SAP AG 2001
The percentage
elements.
method enables you to determine accrued costs using a percentage based on cost
The advantage
of this method compared with accrual calculation (for which a recurring entry in FI is used), is that accrued costs are calculated using the actual costs. The percentage method is therefore to be recommended, for example, for the accrual calculation of wage costs, such as vacation bonuses.
In
an accrual calculation, the accrued costs are debited to the cost centers. At the same time, one of the accrual objects that you defined (a cost center or internal order) is credited. The actual costs are also posted to the accrual object to calculate, analyze and allocate all balances between the expenses in FI and the accrued costs in CO.
The accrued
costs are posted using an accrual cost element (cost element category 3). In addition, you maintain an overhead structure in which the different components of the accrual calculation are defined, and in which the accrual object is identified that is credited during every periodic posting.
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Periodic Reposting
Allocation Cost Center 473120 +15 000.473120 -15 000.-
Telephone January
Allocation rule: Statistical key figure
Long distance calls 2000
Long distance calls 2000
2100 - Finance & Administration 473120 +6000.-
2200 Human Resources 473120 +6000.-
Long distance calls 1000 2300 Purchasing 473120 +3000.-
SAP AG 2001
Periodic repostings
are used as a posting aid.
Transactions
relevant to Controlling (CO) such as telephone costs, postal charges, insurance, and so on are entered in Financial Accounting (FI) and posted to an special allocation cost center, which is used exclusively for cost collection. This minimizes the number of different cost center assignments you have to make when entering data in FI. At the end of the period, the costs in the allocation cost center are reposted to the cost centers which actually incurred the costs according to rules defined in the allocation cycle.
The original (primary)
cost elements are retained.
Periodic repostings
should only be used when the identity of the allocation (sender) cost center is not important to the receiver cost centers. In periodic allocation transactions, line items are recorded for both the sender and receiver sides in order to document the allocation in full detail. However, in a periodic reposting, the identity of the sender allocation cost center is not stored in the totals records. You can only analyze where the costs come from using the line items, not the totals records. This improves system performance when executing and saving the repostings.
The receivers
on an indirect activity allocation can be other cost centers, WBS elements, internal orders, cost objects or business processes. You can restrict the number of receivers allowed in Customizing.
Periodic reposting can be
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reversed and repeated as often as desired.
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Distribution
Cost Cost Center: Center: Electricity Electricity 416100 416100 +23 +23 000.000.416100 416100 -- 23 23 000 000 .-.-
Electricity January
Allocation Rule: Fixed Percentages 30%
20%
50%
4220 - Production, Pumps
4240 - Production, Paints/ Solvents
4260 - Production, Bulbs
416100 +6900.00
416100 +4600.00
416100 +11500.00
SAP AG 2001
Distribution is
intended for the transfer of primary costs from a sender cost center to receiver controlling objects. Only cost centers or business processes may serve as senders in a distribution allocation.
The receivers
for allocation can be other cost centers, WBS elements, internal orders, cost objects or business processes. You can restrict the number of receivers allowed in Customizing.
Primary postings
(such as energy costs) are collected on a service cost center and allocated at periodend closing according to rules defined in the distribution cycle. In the above example, the allocation rule Fixed Percentages is used. Other allocation rules are available.
Only primary costs can
receivers.
be reposted. The original cost elements are retained on the postings to the
Line items
are recorded for both the sender and receiver sides in order to document the allocations in detail. In comparison to a periodic reposting, a distribution updates the partner (sender) in the totals record so that it may be identified on the totals record level in the information system.
Distributions can
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be reversed and repeated as often as desired.
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Assessment Cafeteria 420000 6,000 416000 1,000 612000 2,000 Ë 9,000 631000 -9,000 Assessment (cafeteria)
420000 Salary costs January 416100 Energy 612000 Maintenance
Allocation Rule: Statistical Key Figure (Employees) Employees 30
Employees 10
Employees 50
1000 - Corporate Services
1220 - Vehicles
3200 - Marketing
631000 +3,000
631000 +1,000
631000 +5,000
SAP AG 2001
Assessment is
used for the allocation of primary and secondary costs from a sender cost center to receiving controlling objects. Only cost centers or business processes may serve as senders in a distribution allocation.
The receivers
for assessment can be other cost centers, WBS elements, internal orders, cost objects or business processes. You can restrict the number of receivers allowed in Customizing.
Primary and
secondary costs are allocated at period-end closing according to rules defined in the assessment cycle. The above example uses statistical key figuers for the allocation.
Each
segment of an assessment cycle is assigned an assessment cost element (secondary cost element category 42). All costs allocated in an assessment are classified on the receiver(s) with these assessment cost elements. Alternatively, you can use an allocation structure to define the cost elements that are to be allocated and the assessment cost elements to be used. You can assign individual cost elements to an assessment cost element for this. You can save the allocation structure when you maintain the segment.
Line items
are created on the sender and receiver to document the allocation. The system does not display the orginal cost elements on the receiver side. Therefore, allocation using assessment is useful if it is not important to have an explanation of the costs for the receiver.
Similarly to An
a distribution, an assessment updates the partner in the totals record.
assessment can be reversed and repeated as often as desired.
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Overhead Rates
Warehouse
Warehouse Cost Center
Cost Object
Credit from overhead calculation -200
Costing sheet COGM
1 barrel
Oil 1000 Overhead for storage 200
Overhead Percentage 20% SAP AG 2001
Overhead
calculation is another form of periodic cost allocation. Overhead can be applied to almost any CO account assignment object. The sender (credit object), however, can only be the cost center, internal order or business process.
Overhead
can be calculated on the basis of a percentage of base costs, or as a fixed amount for each reference quantity. Let us assume that overhead must be calculated for the withdrawal of plastic pipes from the warehouse. The overhead can be calculated as a percentage rate of the cost of the pipe, or as a fixed overhead amount per meter of pipe length.
The calculation base,
the overhead, the credit cost element and the credit object are defined using a costing sheet. The cost element used is a secondary allocation cost element from category 41. The costing sheet is assigned to the objects in the master data, that receive the overhead postings.
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Order Settlement
Possible Settlement Receivers
Orders
Cost center
Debits - Credits = Order balance
Settlement
Order
Options:
project
- By cost element or settlement cost element
Proftblty segment
- Settlement rule to all cost elements or differentiated based on origin layout - Distribution: % / amount / equivalence number
G/L Account Asset Sales order with cost collector ...
SAP AG 2001
Internal
orders normally act as interim cost collectors and as an aid to the planning, monitoring, and reporting transactions. Once the task is complete, the costs have to be settled to their final destination (e.g. cost center, fixed asset or profitability segment). This is the "settlement" business transaction, which is another form of periodic cost allocation.
You
can run settlement at the end of the period or the end of the order life cycle, depending on the type of order and its function in the enterprise.
You
can settle orders to numerous different types of receivers, providing they are defined as valid in customizing and there are no system restrictions (such as period locks) that prevent settlement. Examples of possible settlement receivers include cost centers, other orders, projects, profitability segments, fixed assets and G/L accounts.
A
settlement rule must be defined for each order. This rule is defined in the order master record. It may specify that all of the costs on the order are settled to a single receiver, or may be distributed among multiple receivers.
You
can control settlement as you require, using the numerous settlement options that are available.
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Methods for Periodic Quantity Allocation
Method
Technique
z Indirect allocation (with defined activity quantity from sender)
z Cycle / Segment
z Indirect allocation (with undefined activity quantity from sender - inverse)
z Cycle / Segment
z Target = actual activity allocation z Template allocation
z Activity z Processes SAP AG 2001
Indirect
activity allocation can be regarded as a "distribution of activity types", and uses the cycle/segment method.
The target=actual activity allocation allocates
current actual operating rate.
A
activity quantities as planned, but according to the
special type is template allocation.
y When activity is allocated, a resource structure (bundle of activity types) is stored in a template, and then later adapted (based on quantity) to an output quantity, and allocated to receivers. y During process allocation, you define a cost driver for the process and then later allocate a process quantity that is dependent on the cost driver. You can use any information provided in the system as a cost driver.
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Indirect Activity Allocation Activity quantities for the sender object can be determined Cost Center "quality assurance" Tester hours 9
Check: Goods receipt Tester hours?
Activity quantities for the sender object cannot be determined Cost Center "quality assurance" Tester hours?
Check: Goods receipt
Check: Finished goods Tester hours?
Tester hours?
Check: Finished goods Tester hours?
SAP AG 2001
When
you allocate indirect activity, the system allocates activity quantities as actual and plan quantities. Unlike direct activity allocation, keys are defined (tracing factors) for allocating the activities to the receivers.
Indirect
activity allocation is based on segments and cycles, which are used for defining the sender/receiver relationships. This is similar to the other methods in period-based allocation. You specify the processing method for each segment.
During indirect activity allocation,
costs are allocated using an internal cost element for activity allocation (secondary cost element in category 43). Cost elements are assigned from the master record in the cost center/activity type plan, where these assignments can also be overwritten.
Cost
centers are used as senders in indirect activity allocation. The receivers of an indirect activity allocation can be other cost centers, WBS elements, internal orders, cost objects or business processes.
Depending on
the category of the activity type that you want to allocate, you can choose one of two different allocation approaches. y Manual entry of the activity quantity of the sender y Retroactive determination of the activity quantity of the sender using the R/3 System based on user-defined rules.
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Enter Actual Activities for Sender Cost center 4280 Quality Inspection Tester Hours: 1000 Allocation Rule: Variable Portion (Number of test parts)
8000 Test parts
6000 Test parts
6000 Test parts
4200 - Production, Motor cycles
4215 - Production, Automotive
4290 - Production, Elevators
400 Test hours
300 Test hours
300 Test hours
SAP AG 2001
You
can generate total activity quantities from the sender cost centers for most activity types. The posted activity quantities are distributed from the senders to the receivers using indirect activity allocation. This distribution takes place according to how the indirect activity allocation cycle was defined in the segments.
You
have to create an activity type for indirect allocation (activity type 3) for activities that can be measured and posted for a sender. Next, you post the activity quantity to the sender cost center.
Allocation to
the receiver takes place during the indirect activity allocation process. The allocation segment must be based on the sender rule Posted quantities. It is possible to use all receiver rules, with the exception of Fixed quantities.
If,
for example you want to measure the time that your testers use for test activities, do not measure the time taken to test parts that are required for all production cost centers. This means that you get the total activity quantity for the sender but not the individual receiver values. It is however, possible to allocate the generated activity values to the number of tested parts for each production cost center. This information is available, for example, as statistical key figures from the LIS. You can allocate the total tester activities (in hours) to the receiver cost centers using indirect activity allocation, and in doing this you also take into account the proportion tested parts per cost center.
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Actual Activities for Sender not Entered
Weighting factor: 0.25 4000 x 0.25 = 1000 Hrs
Cost center 4280 Quality Inspection Tester Hours: 2500 Allocation Rule: Variable portion (Number of test parts)
Weighting factor: 0.25 6000 x 0.25 = 1500 Hrs
4000 Parts
6000 Parts
4260 - Production, Flasks, line 1000
4270 - Production, Flasks, line 2000
1000 Test hours
1500 Test hours
SAP AG 2001
Activity quantities, for which
you can not generate the produced quantity or for activity quantities that would be very time intensive to generate, can be calculated using indirect activity allocation as follows: y using a receiver tracing factor y by making a explicit entry in segment definition (fixed quantity for sender or receiver)
For
this type of indirect activity allocation you need to create an activity type with category 2 (indirect calculation, indirect allocation) The appropriate segment must either be based on a combination of sender rule retrograd calculated quantity and a receiver rule of your choice, or the same sender and receiver rule fixed quantities. If you use the sender rule retrograd calculated quantities, you can define the relationship between the quantity unit for the tracing factor and the quantity unit for the activity, using a sender specific weighting factor (standard value 1).
Example:
Due to the multiple activities of the testers, it is difficult to measure the tester time for a specific test. You can relate these activities to statistical key figures, which state the propoertion of tested parts for each production cost center. Using a sample measurement, you have determined that each test takes on average 15 minutes per part (0.25 hours). You set this value as the weighting factor for the sender. The system uses this data to allocate the tester hours for each production cost center as well as the total tester hours used.
You
can also define a receiver weighting factor for all cases where the relationship between activity type and tracing factor is not consistent for all receivers. In the example above, you would choose this option if the time required to test parts for production 4260 was not identical to the time required to test parts for production 4270.
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Example of Period-End Closing in CO-OM (1)
Asset Accounting Investment Management
Human Resources Overhead rates Settlement of overhead cost orders Indirect activity allocation Accrual calculation
Periodic reposting
Distribution Assessment SAP AG 2001
During period-end
closing in Overhead Cost Controlling, you need to allocate the auxiliary cost center costs to main cost centers as the first step. The overhead cost orders for the cost centers must be settled at the appropriate time.
Period-end
closing in CO should be embedded in an integrated system in closing for the "whole" R/3 System. To find all costs in OM, it is useful to transfer the following before OM closing: - Personnel costs (HR Payroll) - The depreciations and accrued interest from FI-AA and - Miscellaneous data relevant to OM from other components
The above
diagram shows a possible sequence of periodic transactions.
- Note that these steps are not normally carried out one after the other, but that some steps can be repeated for different object groups if required. - When doing this, you need to ensure that you have the right sequence and cost assignment for your business needs. Once
period-end closing has finished, all overhead cost orders and auxiliary cost centers should have a zero balance.
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Example of Period-End Closing in CO-OM (2)
Cost Center Balance
Assessment to Profitability Analysis
Variance calculation
Calculation of actual price
Revaluation of the activity quantity flow
SAP AG 2001
In
the second step, you should close the main cost centers.
The variance analysis
is an analysis tool for finding out the cause of variances. This tool finds out why a cost center has overabsorption or underabsorption at the end of a period. You cannot use this tool to change the balance of the cost center.
To reduce the
main cost center balance to zero (by allocating the over/underabsorption), you have the following two options: - Allocation by means of assessment to Profitability Analysis: This means that you do not use the cost objects to allocate the over/underabsorption of the cost centers. The main issue here is how the cost center balances are assigned to the market segments. - Actual price calculation and revaluation of the activity quantity flows: This enables you to allocate the over/underabsorption of the cost centers to the cost objects. This is required for displaying the actual costs from the period on the cost objects. This is particularly useful if you want to use the actual costs for a subsequent valuation of your warehouse stock at the actual cost of goods manufactured (function: actual costing/Material Ledger). Alternatively for other reasons, you need to use actual costs (for example, for expense-based billing of the cost object, or if an analysis of the actual success of sales order-related production or service provision is required).
Since revaluation
at actual prices can leave small balances on the cost center (rounding errors), it is, in this case, also useful to use assessment to allocate the remaining balances to Profitability Analysis, to improve the reconciliation between CO-PA and FI.
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Variance Calculation on Cost Centers Area Target 16,000 -16,000 0
Total variance
Actual 20,000 -15,000 5,000
Input side
Where does the under/overabsorption come from?
Output side
Input price
Output price
Input quantity
Output quantity
Resource usage
Fixed costs
SAP AG 2001
You
can use the variance calculation to analyze the causes of under/overabsorption on your cost centers or business processes.
The variance calculation is an
analysis tool only. The variances are not allocated further. To credit the cost centers completely, you need to use the actual activity prices for revaluation, or use assessment for distribution to the profitability segments.
The system does the following to
calculate variance:
y It calculates the target costs y It splits up the actual costs among the activity types y It calculates the variances for each combination of cost center and activity type. The variance calculation
clarifies the difference between target and actual costs. Numerous variance categories are used for this, which differentiate between the input and output sides. The input side contains all the cost center debits and credits, and the output side contains the activity allocations of the cost center.
Variance calculation is
© SAP AG
cumulative, meaning that the total of all variances equals the total variance.
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Revalue using actual prices
Cost center
Internal Production orders orders Maintenance orders
Actual Activity price
Projects
Activity Activity Cost Center type Type
Cost object
WBS - Element
Process Process Product cost collector
Networks
Profitability segment SAP AG 2001
As
the actual price for an activity type can only be calculated at period close, when posting actual activities during the period, the planned prices are used to valuate the activity quantities.
After
calculationg the actual activity prices, you can revaluate the activity quantity flows. The following differences should be taken into account during this process: y If you want to revaluate activity allocations to cost centers, business processes and profitability segments you must set the revaluation indicator in the setting for the versions fiscal year. Revaluation then takes places during the calculation of actual activity prices. You can choose to proceed as follows: Differences between the allocation of planned and actual prices are posted to a separate data record. New valuation updated the original data recrod. You should choose this option when no planned prices exist, in other words when the original allocation was not valuated. y If you want to revaluate internal orders, production orders, WBS elements, networks and so on, you must execute a revaluation transaction. This transaction can be found in the menu for the corresponding CO Components. Revaluation data is always saved in a separate data record in the R/3 data base. y Through calculating actual prices and then revaluating all existing activity quantities you can fully credit the sender cost center. Alternatively you can allocate the under/ over absorbtion of your cost center directly to Profitability Analysis.
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Cost Object Controlling (Product Cost by Order)
At the conclusion of this topic, you will be able to: z Allocate overhead to an order z Allocate process costs to an order z Deliver material to stock z Calculate work in process (WIP) z Calculate variances z Settle the order balance
SAP AG 2001
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Process Chain: Order-Related Manufacturing
Order archived/deleted Settlement Variance calculation
Order request Order creation
Header
Availability check
OPERATIONS OPERATIONS
Goods receipt
MATERIAL MATERIAL COMPONENTS COMPONENTS
Release of order WIP calculation
PRODUCTION PRODUCTION RESOURCES RESOURCES
COSTS COSTS
Overhead costs
PLAN PLAN TARGET TARGET ACTUAL ACTUAL
100
20 50
Shop paper printing Material withdrawal
Revaluate at actual prices Allocate process quantities
Confirmations
SAP AG 2001
At
the end of the period, the cost objects are settled.
There are two
different methods:
y Product Cost by Order: - Work in process is calculated at actual cost. - As long as the cost object is not yet delivered, there will be WIP but no variances. - When the cost object is delivered, the WIP is canceled and variances are calculated. y Product Cost by Period: - Work in process is calculated at target cost. - There will be both WIP and variances.
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Typical Steps in Period-End Closing in CO-PC
Periodic Cost Allocation
Template Allocation Revaluation Overhead
Calculation and Analysis
Work in Process Scrap Variances Settlement
FI/CO Posting SAP AG 2001
During period-end
closing, the remaining costs are first allocated to the cost object:
y Activities and processes are allocated using template allocation. y Activity quantities are revaluated at actual prices (provided the actual prices were calculated in OM beforehand). y Overhead rates allocate overhead to the cost object and credit a cost center or internal order. Now
that all costs are on the cost object, you can start final costing. This includes:
y WIP calculation: WIP can be calculated either for the actual costs or based on target costs for the operations confirmed to date. This depends on whether you are using the Product Cost by Order or Product Cost by Period method. Most cost objects only allow one method or the other. WIP calculation is controlled by the results analysis key specified in the cost object. y You can then calculate variances and scrap. With the Product Cost by Order method, you can only do this if the cost object has the status Delivered or Technically completed (status DLV or TECO). Variance calculation is controlled by the variance key specified in the cost object. Variance calculation is not possible for all cost objects. The settlement
process settles the order values to FI, EC-PCA, and CO-PA. If the cost object has no WIP, the balance on the order after settlement is zero.
Settlement
results in the following postings:
y If the material has price control V, the balance on the order is settled to inventory. With price control S, the balance is moved to the price difference account in financial accounting. y The work in process can be posted to FI and Profit Center Accounting. y Variances and scrap can be posted to Profitability Analysis. © SAP AG
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Template Allocation
Material
Statistical key figures/LIS
Cost Center Cost Driver Activity: kWh
Process Quantity Fixed/Variabel Template
Resource Driver
Order Handling
Production Order
2
SAP AG 2001
Process
costs can be allocated to the cost objects with a periodic transaction.
Using cost drivers, the template
calculates the process quantities to be allocated to the material or cost object. This means that process quantities are “pulled” into the cost objects by the production process using the template.
When
processes provide their process quantities, they incur costs due to the consumption of resources (primary costs, activities, and other processes). You can also allocate these resources to the process through a template.
By dividing the
costs of the process by the allocated process quantity, an actual price for the process can be calculated which can then be used to remove over- and underabsorption from the process by revaluating the process quantity allocations. Another possibility is to assess the process balance to Profitability Analysis (see cost center closing).
Process
allocation always contains a combined value/quantity flow with a unique origin, and is therefore an ideal alternative to overhead rates.
It
thus contributes to better cost transparency and improved analysis of the costs on the cost object.
© SAP AG
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Calculating WIP at Actual Cost
Cost Object Cost Components
Plan
Actual
Glass
1,500
900
Plugs
2,000
1,100
Cable
500
300
Material
4,000
2,300
Labor
2,500
1,400
Overhead
1,500
855
Process
1,000
745
Total costs
9,000
5,300
Delivery value
4,000
Order balance
1,300
WIP at actual costs .
1,300
SAP AG 2001
The basis for
work in process (WIP) can be either the actual costs for the order or the target costs for the completed operations.
With
the actual cost method, the WIP per order is the difference between the debited actual costs and the total credits for any partial deliveries.
With
the target cost method, the WIP is determined by multiplying the quantity remaining at each operation with the planned costs for that operation. The planned costs are determined either with the current standard cost estimate or a version-specific cost estimate. The version-specific cost estimate is most common in repetitive manufacturing.
In
both methods, you can specify in Customizing what percentage of the costs should be capitalized (for example, 100% of the material costs, 80% of the material overhead, and 0% of the production overhead). It is possible to capitalize the entire WIP.
Through
the use of different types of production orders, you can specify in Customizing whether the work in process should be calculated on the basis of actual costs or target costs.
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WIP Settlement
FINANCIAL ACCOUNTING
WIP WIPbased basedon on actual actualcosts costs
WIP
Inventory change
Reserves
Expense
via settlement PROFIT CENTER ACCOUNTING Production Automobiles Motor cycles
SAP AG 2001
The WIP
calculation calculates WIP. The accrual results are allocated further once the cost object has been settled. The values can be posted to FI and Profit Center Accounting for this.
The WIP
is not broken down immediately at the beginning of the next period, but is updated during the next period-end closing run. This means that during each period-end closing run, only the difference of the WIP between the current and the last period-end closing run is settled.
The number
of the order for which WIP is posted in FI is saved in the assignment field of the accounting document. This explains the postings in FI.
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Variance Calculation
Variance categories
Input variance
Output variance
Input price variance
Lot size variance
Input quantity variance
Output price variance
Resource usage variance
Mixed price variance
Remaining input variance
Remaining variance
SAP AG 2001
The system assigns each
variance to a variance category. These categories reflect the cause for the variance (for example, price change or lot size variance). Variances can be analyzed in the information system, and allocated to Profitability Analysis according to the variance category.
There are variance
categories on the input and output sides:
y Variances that occur due to goods issue, internal activity allocation, overhead costs and G/L account postings are displayed on the input side. This includes, for example, price variances, quantity variances, resource-usage variances and input variances. y Variances that are caused by the delivery of the planned order quantity being either too high or too low, or the delivered quantity being valuated differently are displayed on the output side. If the delivery is at the standard price, a variance might occur if the order lot size differs from the costing lot size. This is displayed as a lot size variance.
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Variance Settlement Profit Center Accounting Material Ledger
Cost Objects Cost elements
Plan
Glass
1,500
1,800
Plugs
2,000
2,200
Cable
500
600
Material
4,000
4,600
Work
2,500
2,800
O/H costs
1,500
1,600
Process
1,000
1,500
Total costs
9,000
10,500
Delivery value
9,000
Order balance
FINANCIAL ACCOUNTING
Actual
Asset balance Inventory change
Price difference
Variances via settlement PROFITABILITY ANALYSIS Product Plant
1,500
Company code
SAP AG 2001
In
order-related production, variances are calculated and settled as follows:
y When a production order is created, the system automatically creates a settlement rule used for the assignment of the order costs to the material (stock account). In this case, the material is the settlement receiver, the settlement portion is 100% and the settlement type is full (FUL). y When you deliver the finished products to the warehouse, the system updates the material stock account for the material and credits the order accordingly. y When variances are calculated at the end of the period, the system sets the status for the order to "variances calculated". y When the order is settled, the order is credited (the same amount as the order balance). The system makes the following offsetting entries: - If the price control indicator has been set to S in the material master record, the actual costs (variances) are written to a price difference account. - If the indicator has been set to V, then the actual costs (variances) are posted to the material stock account for the material. - The variances are also transferred to Profitability Analysis at this point.
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Method Comparison
Functions
Product Cost by Order
Product Cost by Period
Settlement type
FULL
PERIODIC
Work in process
WIP calculation using actual costs
WIP calculation using target costs
Variances
Variances = actual costs - Variances = actual costs delivery value delivery value - WIP
Settlement
Should be done periodically
Must be done periodically
Cost Object hierarchy
Not possible
Possible
SAP AG 2001
In
Product Cost by Period, you calculate the WIP value using target costs. For run schedule headers, you need to enter the backflushes for the reporting point backflush transaction and for production orders. Confirmed quantites that are not scrap are valuated during WIP calculation (based on target costs) and according to the valuation variant determined in Customizing for Product Cost by Period. These are valuated for work in process and scrap.
Variances
are calculated periodically for Product Cost by Period. The confirmed actual values are compared with the target values in variance calculation. The WIP value is also deducted from the difference between the actual and target values.
© SAP AG
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Period-End Postings: Actual Costing/Material Ledger
At the conclusion of this topic, you will be able to: z Explain the concepts of actual costing z Describe the process of preliminary valuation z Calculate the periodic unit price z Make period-end postings, including a revaluation of inventory using actual prices
SAP AG 2001
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Actual Costing: Costing:Preliminary Preliminary Valuation Actual Valuation StatisticalActual price per category (line)
Category Beginning Inventory Receipts: Other Issues/ Receipts Cumulated Inventory Consumption Ending Inventory Preliminary valuation at standard price
Quantity
Pre. Val.
20
2.000
100
10.000
1.000
110
50
5.000
2.400
148
170
17.000
3.400
120
30
3.000
100
140
14.000
100
Price dif
Price 100
Differences between standard and actual price
SAP AG 2001
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Determining the Periodic Unit Price
Cum. Inventory for prelim. price and cum. price diff.
M 400 )+3 N X M * 100 s e s c e pi piece (170 170 N/PC 0 MX Periodic unit price = 12
Cumulated inventory
Category Beginning Inventory Receipts: Other issues/receipts Cumulated inventory Consumption Ending Inv.
Quantity Prelim. Val. Price diff. 20 100 50 170 30 140
2000 10000 5000 17000 3000 14000
1000 2400 3400 600 2800
XN
Price 100 110 148 120 120 120
SAP AG 2001
The periodic
unit price is calculated at the end of every period and reflects the materials actual cost for the closed period.
To
determine the periodic unit price the system uses cumulated quantities (beginning inventory plus all goods receipts) and cumulated differences (differences between planned price, the price created for all goods receipts and the beginning inventory).
The transaction used to calculate Pirce
the periodic unit price is called price determination.
determination must be completed for each period.
With
single-/multilevel material price determination (settlement control 3), materials are always valuated at standard price. The periodic unit price is calculated for the closed period and can be used to update the V Price field in the material master.
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Single-level Material Price Determination Procurement
Material
Single-level price determination
Level 3
Level 2
Financial acctg.
Finished product
Inventory
Semi finished product
Inventory
Raw material
Inventory
Price diff.
Financial acctg.
Price diff.
Level 1 Price diff.
= Variances
SAP AG 2001
© SAP AG
Financial acctg.
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Multilevel Material Price Determination Procurement
Material
Multilevel price determination
Internal
Internal
Financial acctg.
Finished product
Inventory
Semi finished product
Inventory
Raw material
Inventory
Price diff.
Financial acctg.
Price diff.
External Price diff.
= Variances
SAP AG 2001
© SAP AG
Financial acctg.
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Period-End Postings in Profitability Analysis
At the conclusion of this topic, you will be able to: z Describe data flows in Profitability Analysis z Explain data flows in Profit Center Accounting
SAP AG 2001
© SAP AG
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Overview of the Data Flow in Profitability Analysis
CO
Profitability Segments
COPA
Profitability Analysis
Product cost Controlling
Overhead Cost Controlling • Processes
Cost object
• Cost Centers • Internal Orders
Cost estimate
Cost and Revenue Element Accounting FI
Revenues Discounts
SD SAP AG 2001
The data
from the Sales & Distribution (SD) component is one of the most important sources of information for Profitability Analysis.
In
accrued CO-PA, sales data is received when two events occur during sales order processing: when the order is created or changed (optional), and during billing.
In
account-based CO-PA, sales data is received during two events in sales order processing: when goods are issued and during billing.
Costs from other
areas of CO can be periodically transferred into CO-PA, using activity and template allocations, settlements, and assessments.
It
also possible to create a manual, direct posting to CO-PA from FI.
© SAP AG
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Assigning Overhead Costs: Overview COOM
Administrative costs
Assessment
Cost Center Direct/indirect activity allocation
Field service hours
Order/project settlement
Marketing campaign
Assessment
Customer support
Template Allocation
Special deliveries
Process
Value Fields
COPA
SAP AG 2001
To
display all overhead costs in Profitability Analysis, you allocate the overhead costs that were not allocated to Product Cost Controlling to Profitability Analysis. You are provided with different ways of doing this.
For
example, you can allocate internal activity from cost centers either directly or indirectly to Profitability Analysis. Enter the sender (cost center), the receiver (profitability segment) and the quantity of the activity provided. The system then valuates this using the price of the activity type. The calculated value is credited on the sender and debited on the profitability segment that receives the activity quantity. This means, for example, that you can post a transport activity directly to a certain customer without having to post it to a cost center or an order first.
© SAP AG
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Assessment of Cost Center and Process Costs
Process Cycle:
Cost center administration 400000 430000
Assessment
20,000 30,000 50,000
Administration:
COPA
+ 50,000
630000 - 50,000
SAP AG 2001
You
can use assessment, for example, to transfer the variances in production cost centers and the incurred costs on cost centers for sales and administration to Profitability Analysis.
The cost
centers and processes are credited with the allocated amount. This means that all costs can only be allocated once. Cost center costs and process costs are assessed in the same way in Overhead Cost Controlling, whereby you define cycles and run them on a periodic basis. These cycles contain the control information required for assessment. You maintain these in Customizing.
© SAP AG
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Order Settlement to Profitability Analysis Invoice
Costs
Invoices
++ xx% %
Overheads
Order
COPA SAP AG 2001
In
the R/3 System, you can settle internal orders (CO component), sales orders (SD component), projects (PS component) and production orders with product cost collectors (PP component) to profitability segments. You can use these for different functions that are relevant to profitability analysis.
You
can use internal orders or internal projects for monitoring costs of an internal activity, such as the costs of an advertizing campaign. The costs of the activity are assigned to the order, collected and settled to the corresponding profitability segments (for example, the corresponding product group and sales area) once the job has been closed.
The make-to-order
manufacturer can also use an order or project. If it is a sales order from SD, a customer project or a CO order that may have revenue postings, then the manufacturer can post costs (cost of sales or of sales and admin), revenues or sales deductions to this order or project. Once the product is finished, the costs and revenues are settled to profitability analysis. You can also transfer accrued values (particularly important for milestone billing) such as cost of sales, reserves for imminent losses etc. to profitability analysis.
© SAP AG
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Overview of the Data Flow to Profit Center Accounting ECPCA
Profit Center Accounting CO
Profitability Analysis Product cost Controlling
Overhead Cost Controlling • Processes
Cost object
• Cost Centers • Internal Orders
Cost and Revenue Element Accounting FI
revenues Discounts
SD
SAP AG 2001
Before
you can analyze your profits by profit center, the system must summarize all the profitrelated postings in Profit Center Accounting.
Which
data is transferred to Profit Center Accounting?
1
All postings for revenue and cost elements (assignment to profit center using CO account assignment object)
2
Expense and revenue accounts that are posted to using logistic transactions.
3
Balance sheet accounts and other expense and revenue accounts (optional)
© SAP AG
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Balance Sheet Items in EC-PCA EC-PCA
Online
Financial Accounting
Assets
Assets
Work in Process
Work in Process
Inventory Values
Inventory Values
Down Payments
Down Payments Receivables Payables
SAP AG 2001
If
you assign balance sheet items to profit centers, the profit center manager is responsible not only for the profit center’s operating results, but also for its capital assets, for example. Profit centers can therefore also be used as investment centers. You can also calculate additional key figures such as ROI (Return on Investment).
You
can transfer the following balance sheet items to profit centers:
y Fixed assets (acquisition costs and accumulated depreciation) y Material stocks (raw materials, semifinished products, and finished products) y Work in process y Payables and receivables Note:
You can only transfer payables and receivables during the period-end close, using a special program.
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Distribution/ Assessment
Distribution and Assessment similar to Cost Center Accounting
V a l u e
Profit Center Motor cycles
F l o w
Profit Centers Sales Administration
Profit Center Sports cars
Period-End Closing: Distribution
ECPCA
SAP AG 2001
The allocation
of overheads (assessment and distribution) normally occurs at period close. This operation normally takes place directly in CO and is reflected in Profit Center Accounting.
If
your profit center hierarchy contains a service or an allocation profit center, you may have to also assess or distribute the costs in Profit Center Accounting.
Under
certain circumstances you will also have to allocate revenues and sales deductions. This can also be done in Profit Center Accounting.
An
important part of this function is also the distribution of balance sheet items (raw materials, assets and so on), that were posted to a profit center and should now be distributed to various receiver profit centers.
The assessment and
distribution of data in Profit Center Accounting is only useful if all operations have been completed in association with period end closing in the modules that supply EC-PCA with data (for example FI, CO, SD, MM and so on).
Distribution
and Assessment operate in a similar way to Overhead management but they only apply to data in Profit Center Accounting.
© SAP AG
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Period-End Postings: Schedule Manager
At the conclusion of this topic, you will be able to: z Explain the purpose and functions of the Schedule Manager z Describe the typical sequence used for period-end processes within Controlling.
SAP AG 2001
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Schedule Manager: Advantages Advantages of the Schedule Manager z Clear and user-friendly for running period-end closing z Transaction-based processing, meaning that the R/3 System automatically processes the required steps z Simplified process monitoring z Time saved by worklist used for error analysis and integrated error correction procedures z Reduced total processing time through optimized processing in worklists SAP AG 2001
The Schedule
Manager makes period-end closing more simple, as all the related transactions can be run via a central, cross-application function. The Schedule Manager contains all the reqiured functions, including the structure definition of the period-end closing process, the scheduling of jobs and monitoring of results.
The Schedule
Manager provides all the data required for period-end closing. All employees that have authorization can use this to gain information on outstanding tasks. They can also display objects that are to be processed, and schedule further tasks. You can clearly see, for example, when monthly closing needs to be finished and the previous period needs to be closed. You can use the Schedule Manager to check at any time which tasks were done at what time, and with what results.
The Schedule
Manager supports you in other areas of the SAP R/3 System also. It supports you with the definition, scheduling, running and control of individual periodic tasks and complex processes that need to be done at regular intervals. You have an up todate overview of the processes at any time you require.
© SAP AG
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Schedule Manager: Scheduling Task List
2000
October
Send mail: Period-end closing started Set period lock Periodic reposting of personnel costs Internal orders: Overhead and settlement CCtr: Allocations
Daily overview: 31 October 1999 Time Description
Simple administration of period-end closing with the Schedule Manager
Status User
8:00 Mail sent
Miller
8:15 Actual period lock
Miller
8:30 Periodic reposting
Brown
9:45 Internal orders: Closing
Fowler
11:30 CCtr: Allocations
Fowler
SAP AG 2001
Start
the transaction using the Schedule Manager, which is provided in the R/3 System. The first display provides you with user information that you can deactivate at any time.
You
can use the Schedule Manager to do the following tasks:
y Create a structured task list The tasks can be completed periodically and by more than one user. The task list contains the following task types: y Flows that have been defined and can be run in the background on a periodic basis (compare with the flow definition) y Individual jobs that can be run in the background y Programs or transactions that are to be run individually and online y Notes as bookmarks for describing tasks that are not processed in the R/3 System. You
can store detailed information for each task.
The daily overview
provides you with an overview of all the tasks that have been done or scheduled in a day. The system logs each task that has been completed and provides you with information on the planned and current start time, and also the current status of each task. From the daily overview, you can go to the monitoring function, where you can call up more information on jobs and flows.
© SAP AG
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Schedule Manager: Task List - Flow Definition Task List
Flow Definition: Internal Orders
Send mail: Period-end closing started
Workflow started
Set period lock
Select worklist
Periodic reposting of personnel costs
Calculate overheads
Internal orders: Overhead and settlement
Settlement
CCtr: Allocations
? Define flows for
Check worklist for internal orders
background jobs for
Start processing the worklist again
automatic processing
Workflow closed
SAP AG 2001
In
the flow definition, you can group tasks together that have to be processed in the background in a particular sequence.
You
control these flow definitions using the workflow.
You
can structure subflows and integrate them into a flow definition.
You
can insert user decisions for testing purposes.
Worklists
enable you to restrict the total processing time required.
You
use the task list to group the individual tasks together. To ensure that the job flow is adhered to, you can create a flow definition that contains all the dependent work items.
© SAP AG
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Schedule Manager: Monitor Task List
Status
Details Parameters Extra info. Start date End date User name Job status Business Transaction Activity
Actual period lock Periodic Reposting Internal orders: Closing Actual overhead
Spool list Job log Detail List: Basic list
Actual settlement User decision
The monitor contains all important information
Messages Mess.
Text
202
ORD 100070 Lisbon trade fair
205
Maintain sender settlement rule
202
ORD 100071 Atlanta trade fair
205
CCtr 12345 does not exist on 31.10.99
202
ORD 100358 Special events
217
CCtr 600199 does not exist on 31.10.99
202
ORD 101065 Marketing
SAP AG 2001
In
the monitor, you can call up detailed information on all active or completed jobs and flows that were scheduled in the scheduler.
The status All
list.
field displays exactly where errors occurred.
of the messages displayed by the sysetem while the job was being processed are displayed in a
From here,
you can switch to the spool list, job log, detailed information and to the basic list.
When
you check the results, you can change the system status and give a reason for the change. The system then logs your manually made changes.
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Reconciliation Ledger
At the conclusion of this topic, you will be able to: z Explain the task of the reconciliation ledger z Run some reports for reconciliation between FI and CO.
SAP AG 2001
© SAP AG
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Reconciliation Ledger
Primary posting Allocation
External Accounting
Reconciliation
Reconciliation Ledger
Internal Accounting
Controlling objects FI Organizational units: company code, business area, functional area SAP AG 2001
Data from internal
and external accounting must be reconcilable. One of the main functions of the reconciliation ledger is the reconciliation of postings: y Postings in FI are automatically transferred to the relevant CO module for cost accounting purposes (online and in realtime). The CO totals in the reconciliation ledger are updated for these postings. y If amounts are allocated within CO using company codes, functional areas or business areas, then this information must be transferred back to FI. The R/3 System does not automatically send this data to FI. The CO totals in the reconciliation ledger, however, are automatically updated for these postings. y You can use the reconciliation ledger to make a posting that sychronizes the FI data with the CO postings.
You
can decide whether to activate the reconciliation ledger in the R/3 System or not.
In
addition to the reconciliation of FI and CO data, the reconciliation ledger can be used for the following: y CO Overall cost analysis without long processing times y Navigation help and access to CO via the profit & loss account.
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Reconciliation Reports
FI
Difference (e.g. from reposting)
General Ledger
CO
Reconciliation Ledger
Reconciliation Report
for company code 3000 OK
Account 400000 415000
FI 200000 500000
CO 150000 500000
Balance 50000 0
SAP AG 2001
Special cost
element reports are supplied in the SAP R/3 System for evaluating the reconciliation ledger. You can use these reports to compare the values in internal and external accounting, display the costs incurred for each object class, and see the cost flows between company codes.
You
use the cost flows overview report to document the cost flows in Controlling, as well as the reconciliation postings. This report displays all the cross-company-code, cross-business-area or cross-functional-area cost flows in Controlling.
You
can use the data in the reconciliation ledger to make interesting analyses using other reports (including your own).
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Period-End Postings in CO: Unit Objectives
Having completed this Unit, you should be able to: z Post statistical key figures, perform an assessment of costs, and settle an overhead order. z Allocate overheads and assign process costs to an order, deliver materials to stock, calculate WIP and variances, and settle an order. z Explain the purpose of the Reconciliation Ledger and execute appropriate reports. z Explain period-end closing activities
SAP AG 2001
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Exercises Unit: Period-End Postings in CO Topic: Overhead Costs
•
Execute the period-end postings for your overhead cost objects (cost centers and overhead orders).
The company would like to run the period-end closing process. To close Overhead Cost Controlling for the period, the balance on the overhead cost objects must be zero. With overhead cost orders this is accomplished by settlement, which credits the service cost centers by allocating the costs they incurred to the primary cost centers that received the output of the service cost centers. The primary cost centers are credited as well – their balance is allocated either to Cost Object Controlling or to Profitability Analysis.
1-1
You have completed the actual postings on your trade fair order and can now allocate its costs to the service cost center that is responsible for the costs. 1-1-1 Execute actual settlement for your trade fair order. (The order number is on your data sheet.) For the settlement and posting periods, use the current period. Go to the detailed list. Display the sender and receiver view. Which cost element was used for the settlement? ___________________________________________________ 1-1-2 Execute the Order: Actual/Plan/Variance report for the current period and plan version 0. Execute the report for your trade fair order. What is the balance on your order? ___________________________________________________ 1-1-3 Execute the Cost Centers: Actual/Plan/Variance report for the current period and plan version 0 to see how the settlement affects your cost center. Execute the report for the service cost center (SERV-##).
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1-2
Create an assessment cycle and segment to allocate the costs of your service cost center to the production cost centers that it supported. 1-2-1 Create an actual assessment cycle AAC-##, which starts on the first day of the current fiscal year. Give the cycle the description Group ## assessment. Create a cycle run group with the name GR##. 1-2-2 Attach the segment AACS-## and enter the description Service ## assessment. Enter assessment cost element 631300 for services of the company. Allocate 100% of the posted actual amounts from your sender cost center. The tracing factor allocates fixed percentages. 1-2-3 The sender of the allocation is your service cost center (SERV-##). Enter cost element group OAS for the allocation. The receiver of this allocation is cost center group HAC040. 1-2-4 Switch to the tab Receiver tracing factor to define a cost allocation of 95% for cost center PROD-## and a cost allocation of 5% for cost center PROD00. Run a formal check on the cycle and segment you created. Save your entries.
1-3
Execute actual assessment for your service cost center. 1-3-1 Execute the assessment as a test run for your cycle (AAC-##) and the current period. Specify that detail lists are to be displayed. 1-3-2 Execute the assessment as an update run to post your allocation. (Deselect Test run.) 1-3-3 Execute the Cost Centers: Actual/Plan/Variance report for the current period and plan version 0 to see how the assessment affects your service cost center (SERV-##). What is the balance on your cost center? ___________________________________________________
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Unit: Period-End Postings in CO Topic: Cost Object Controlling
•
Execute the period-end close in Cost Object Controlling. Include process cost allocation, overhead calculation, WIP calculation (work in process), variance calculation, and order settlement.
At the end of the period, the process costs and the overhead must be allocated to the cost objects. Then you can analyze the costs on the cost object. Since our order is manufactured by lot (order view), there are two different cases: If the order does not have final delivery status: It is recommended that you first calculate the WIP. This is necessary because the value of the unfinished products is not yet reflected in the balance sheet and profit and loss statement. The reason for this is that the costs for these products (such as material and activity consumption) already affect net income, but the value of the products is not capitalized until the time of the goods receipt. Closing the period without calculating and capitalizing WIP would therefore result in poor figures in the P&L statement, the balance sheet, and even in Profit Center Accounting. The WIP calculation function only calculates the values. These values are not transferred into FI and Profit Center Accounting until the order is settled. If the order has final delivery status: Since the order has been delivered, no products remain in the production process. Therefore, WIP must be zero. However, WIP must still be calculated so that the cancellation amount for the WIP capitalized in the previous period can be determined. The balance remaining on the order after final delivery is the total variance, which you can examine with the variance calculation function. The variance calculation function shows the reasons for the variances against the target values for the debits and credits of the order by classifying the variances into variance categories. The variance categories are saved on the order as statistical information so that they are available later for evaluations and summarizations. The final step is settlement of the order. The balance is posted to the stock accounts or to the price difference account in accordance with the posting rule. The WIP (cancellation amount) is transferred into FI and PCA and the variances can be transferred to CO-PA broken down into variance categories. After settlement, the balance on the order is zero.
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2-1
The first step in the period-end closing process is the allocation of process quantities using template allocation. Using the individual processing transaction, you can execute process cost allocation for your production order for the current period and version 0. (The order number is on your data sheet.)
2-2
The next step in the period-end closing activities for cost object controlling is to determine the overhead rates. (Note: We will omit revaluation with actual prices because we haven’t calculated any actual prices in Cost Center Accounting). Use individual processing for overhead to calculate the overhead rates for your production order.
2-3
Check the actual costs allocated to the production order by the process cost allocation and overhead application functions. From the report structure for Controlling, choose the option for Product Cost by Order and run the detailed report for your production order with your layout GR##.
2-4
Determine the work in process for your production order in the current period. Use results analysis version 0, choose Log information messages, and execute WIP calculation in an update run.
2-5
Using the WIP report, look at the WIP value that has been calculated for the production order. This report is available in Cost Object Controlling under Product Cost by Order.
2-6
Settle the production order in an update run. This transfers the work in process to FI and PCA. The period is the current period, the processing type is Automatic. When settlement has been executed, a detailed list appears. Review the sender and receiver information. Drill down on the items of Financial Accounting and Profit Center Accounting (PCA).
2-7
From this point onwards, we will assume that production is completed. Execute a progress confirmation/final confirmation for operation 60 for the remaining 60 units. To do this, confirm a total quantity of 100 pieces in the production control menu. Note that this is a milestone operation. The preceding operations are automatically confirmed with the planned execution times adjusted to the confirmed quantities (target/actual confirmation). The goods receipt for the 60 units is posted automatically (automatic goods receipt).
2-8
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Review the actual costs posted to the production order from the completion confirmation. Additional debits for the production activities and a credit for the delivered quantity of 60 units must have been assigned to the order. Execute the detailed report again for your production order with your layout GR##.
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2-9
The order now has final delivery status. Execute WIP calculation again to determine the cancellation amount. Note: Since the period has not changed during our course since the last period-end close, the result of WIP calculation is not the cancellation amount but the current WIP value of 0. Execute WIP calculation as an update run. Select the current period and results analysis version 0. Select Log information messages and execute as an update run.
2-10
Once the order has been completed, the variances can be calculated. The variance calculation function calculates the difference between the actual cost and the target cost (such as a standard cost estimate). Calculate the variances for your production order for the current period. Execute the calculation for target cost version 0 and select Detail lists. From the variance calculation list, go to the cost element report and the variance analysis report.
2-11
Now execute order settlement to allocate the order balance, the WIP cancellation amount, and the variances to FI, PCA, and CO-PA. Settle your production order for the current period with processing type Automatic in an update run. When the settlement has been executed, a detailed list will be displayed. Review the sender and receiver information. Expand the structure and display the accounting document, the profit center accounting document, and the profitability analysis document.
Optional: Manufacturing has produced another 60 units of material T-F1## that are now in your warehouse. You can deliver these units to your customer and produce an invoice for the delivery, which sends additional revenues (and cost of sales) into Profitability Analysis. For the exact steps to be carried out, see exercises 6-2 to 6-3 in the previous unit (Transaction-Based Postings in CO).
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Unit: Period-End Postings in CO Topic: Selling Goods and Services
•
You learn the difference between selling a product from stock and selling a product (or service) that was produced specifically for a particular sales order.
The company receives an order from a customer to deliver pumps. In addition, pumps are to be installed at the customer’s site.
3-1
Since the customer wants the pumps to be installed in his plant, you create a second item in the sales order. 3-1-1 Create a second item in the sales order (from the previous unit TransactionBased Postings in CO). Installation of the pumps requires 100 hours of activity T-SERVICE. 3-1-2 Double-click on item 20 to access the item, and from there go to the account assignment view. Note the new field in the account assignment view (results analysis key) and the value in the costing sheet field. Delete the results analysis key! Display the settlement rule for settlement to Profitability Analysis. 3-1-3 Check the value for condition type PR00 (price) for the pump installation. 3-1-4 Determine the cost of the installation service. Use a base planning object (TSERVICE) as a template, which contains a predefined quantity structure for the pump installation. Save the cost estimate and return to the condition screen. 3-1-5 Switch to the schedule lines view and check the confirmed quantity. Save the order. If the order is still incomplete, you can add the missing data. (If the system tells you that the order data is still incomplete, you can add the missing data. Select all list entries and choose Complete data. Enter the current date in each date field, and save the order. It is not absolutely necessary to enter this data.)
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3-2
The pumps are installed by cost center 4230 Assembly Pumps. The installation consumes 100 hours of activity 1421 and 20 hours of activity 1420. Enter a direct activity allocation to allocate 100 hours of activity type 1421 and 20 hours of activity type 1420 from cost center 4230 to your sales order. This represents the costs of the installation. Use the entry variant SAP: Sales order/cost object. Post your document.
3-3
Bill the customer for the pump installation, and check the posting. 3-3-1 Create the invoice for the sales order item. The invoice information for the pump installation is generated by the sales order document. Write down the billing document numbers and the billing date. ___________________________________________________ ___________________________________________________ 3-3-2 Display the accounting documents for the billing document. What is the document type of the accounting document? ___________________________________________________
3-4
Allocate the overhead to your sales order. Execute the allocation for the current period. Select Detail lists and execute the allocation as an update run.
3-5
Run the detailed report for your sales order with the layout Plan/Actual Comparison to see how the planned and actual postings affected the service item.
3-6
Settle your sales order document to CO-PA. 3-6-1 First execute the settlement as a test run for the period in which the billing document was posted. Your sales order was created for the sales organization Hamburg (1000). Request a detailed list. If there are no errors in the test run, execute the settlement again as an update run. 3-6-2 Check the CO-PA document generated by the settlement.
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Unit: Period-End Postings in CO Topic: Profitability and Sales Accounting
•
Look at the results in various market segments.
•
Use drilldown reporting to analyze the data for different profitability segments.
After production and sales transactions have been recorded, you would like to look at the results for different market segments. You want to know where your profits rose and where they fell, and analyze the causes of these changes. This information is required not only at the end of the period, but also after each sales transaction.
4-1
As a consequence of the billing and settlement of the sales order (see exercise 8 in unit 8, exercise 2-11 [optional], and exercise 3 in the current unit 9), postings were made to CO-PA for which the system generated line items. Access the line items through the Actual Postings menu path. Select line items for your user ID and restrict the selection to postings with record types C to F that were made yesterday and today.
4-2
Examine the results for your company. Execute contribution margin report AC040 for the current fiscal year. 4-2-1 Execute the report. 4-2-2 Select the overview and drill down to the results for the Hamburg plant (1000), the Pumps division (01), product T-F1##, and customer 1000 (Becker Berlin). 4-2-3 Look at the same information for the pump installation service (product TSERVICE in division 08, plant 1200) 4-2-4 Drill down on the actual line items for plant 1200 (Dresden), division 08, product T-SERVICE, and customer 1000 to view the postings to CO-PA. 4-2-5 Look at contribution margin 2 for all products that you delivered to customer 1000.
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Unit: Period-End Postings in CO Topic: Reconciliation Ledger
•
Analyze the cost flow between different business areas to show data that was allocated in CO but is not reflected in FI.
The company has different business areas within the controlling area. Some allocations within CO will cross business areas; however, this information is not immediately updated to FI. Since the business area is one of the levels at which data is reported in FI, this information must be reconciled between CO and FI.
5-1
In the information system in Cost Element Accounting, run the appropriate report to analyze cost flows between business areas. Look at the cost flow between the business areas to which our production and service cost centers are assigned (1000 and 9900, respectively). 5-1-1 Execute the report Cost Elements: Allocations Between Business Areas for the current period for all business areas in controlling area 1000. The default value in the business area field includes all business areas. You can accept this setting or enter the interval 1000 to 9900.
5-1-2 To view the appropriate report, set the business area to 1000 (Mechanical Engineering) and the trading partner business area to 9900 (Corporate Other). Explain the displayed data. ___________________________________________________ ___________________________________________________
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Solutions Unit: Period-End Postings in CO Topic: Overhead Costs
•
Execute the period-end postings for your overhead cost objects (cost centers and overhead orders).
The company would like to run the period-end closing process. To close Overhead Cost Controlling for the period, the balance on the overhead cost objects must be zero. With overhead cost orders this is accomplished by settlement, which credits the service cost centers by allocating the costs they incurred to the primary cost centers that received the output of the service cost centers. The primary cost centers are credited as well – their balance is allocated either to Cost Object Controlling or to Profitability Analysis. 1-1
Order Settlement 1-1-1 Execute actual settlement for your trade fair order. Accounting o Controlling o Internal Orders o Period-End Closing o Single Functions o Settlement o Individual Processing Enter your trade fair order number in the Order field. Enter the current period in the Settlement period field. Enter the current posting period in the Posting period field. Enter the current fiscal year in the Fiscal year field. The processing type is Automatic. Make sure Test run is not selected. Choose Execute. Go to the detailed list. Display the sender and receiver view. Which cost element is used for the settlement? Settlement cost element 651000 is used.
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1-1-2 Execute the Order: Actual/Plan/Variance report. Controlling o Internal Orders o Information System o Reports for Internal Orders o Plan/Actual Comparisons o Order: Actual/Plan/Variance Enter 1000 in the Controlling area field. Enter the current fiscal year in the Fiscal year field. Enter the current period in the From period field. Enter the current period in the To period field. Enter 0 in the Plan version field. Enter your trade fair order number in the first Or value(s) field. Choose Execute. The balance must be zero. 1-1-3 Execute the Cost Centers: Actual/Plan/Variance report. Accounting o Controlling o Cost Center Accounting o Information System o Reports for Cost Center Accounting o Plan/Actual Comparisons o Cost Centers: Actual/Plan/Variance Enter 1000 in the Controlling area field. Enter the current fiscal year in the Fiscal year field. Enter the current period in the From period field. Enter the current period in the To period field. Enter 0 in the Plan version field. Enter SERV-## in the first Or value(s) field. Choose Execute. The order amount was debited with settlement cost element 651000. 1-2
Create an assessment cycle and an assessment segment. 1-2-1 Create an actual assessment cycle. Accounting o Controlling o Cost Center Accounting o Period-End Closing o Single Functions o Allocations o Assessment Extras o Cycle o Create Enter AAC-## in the Cycle field. Enter the first day of the current fiscal year in the Starting date field. Choose Enter or Execute to proceed to the next screen. Enter Group ## assessment in the Text field. Select Goto → Cycle run group.
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Choose the symbol Create group and enter GR## in the Cycle run group field. Enter Group ## cycle run group in the Text field. Choose Continue (Enter). 1-2-2 Attach a segment. Choose Attach segment. Enter AACS-## in the segment name field, and Service ## assessment in the description field. Enter 631300 in the assessment cost element field. Verify that the sender values are correct: • Posted amounts in the Sender rule field • 100 in the Share in % field • Act. values must be selected In the group box Receiver tracing factor, choose Fixed percentages for the receiver rule. 1-2-3 Define the sender and receiver. Select the tab Sender/receiver. Enter SERV-## in the sender cost center from field. Enter OAS in the sender cost center group field. Enter HAC040 in the receiver cost center group field. 1-2-4 Define tracing factors. Choose Goto o Receiver tracing factor. Enter 95 in the Portion/percent field for cost center PROD-##. Enter 5 in the Portion/percent field for cost center PROD00. Go back to the segment screen. Choose Cycle o Check o Formal check. Save the cycle. 1-3
Execute actual assessment for your service cost center. 1-3-1 Execute the assessment in a test run. Accounting o Controlling o Cost Center Accounting o Period-End Closing o Single Functions o Allocations o Assessment Enter the current period in the From period field. Enter the current period in the To period field. Enter the current fiscal year in the Fiscal year field. Select Test run and Detail lists. Enter AAC-## in the cycle field and choose Enter. The start date will be copied from your cycle. Choose Execute.
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Select Receiver to see the amounts to be assessed. 1-3-2 Execute the assessment in an update run. Go back to the initial screen of assessment. Deselect Test run. Choose Execute. 1-3-3 Run the Cost Centers: Actual/Plan/Variance report. Accounting o Controlling o Cost Center Accounting o Information System o Reports for Cost Center Accounting o Plan/Actual Comparisons o Cost Centers: Actual/Plan/Variance Enter 1000 in the Controlling area field. Enter the current fiscal year in the Fiscal year field. Enter the current period in the From period field. Enter the current period in the To period field. Enter 0 in the version field. Enter SERV-## in the first Or value(s) field. Execute the report. The balance must be zero.
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Unit: Period-End Postings in CO Topic: Cost Object Controlling
•
Execute the period-end close in Cost Object Controlling. Include the process cost allocation, overhead calculation, WIP calculation (work in process), variance calculation, and order settlement steps.
At the end of the period, execute the closing entries in the order they are listed in the menu under Period-End Closing. For detailed explanations on period-end closing for your production order, refer to the exercises.
2-1
Allocate process quantities Logistics o Production o Production Control o Period-End Closing o Template Allocation o Individual Processing Or Accounting o Controlling o Product Cost Controlling o Cost Object Controlling o Product Cost by Order o Period-End Closing o Single Functions o Template Allocation o Individual Processing Note: The menu path in Logistics will not always be shown from this point on. Note: The menu path in Controlling will be abbreviated. Enter the production order number. Enter 0 in the version field. Enter the current period in the From period field. Enter the current period in the To period field. Enter the current fiscal year in the Fiscal year field. Deselect Test run. Select Detail lists. Choose Execute.
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2-2
Calculation of the overhead rates Period-End Closing o Single Functions o Overhead o Individual Processing Enter the production order number. Enter the current period in the Period field. Enter the current fiscal year in the Fiscal year field. Deselect Test run. Select Dialog display. Choose Execute.
2-3
Check the actual costs allocated to the production order by the process cost allocation and overhead application functions. From the report structure for Controlling, choose the option for Product Cost by Order and run the detailed report for your production order with your layout GR##. Accounting o Controlling o Product Cost Controlling o Cost Object Controlling o Product Cost by Order o Information System o Reports for Product Cost by Order o Detailed Reports o For Orders Enter the production order number. For the time frame, select Cumulated. Choose Execute. The actual values should be listed for the cost elements of the process and overhead rates.
2-4
Determine the work in process for your production order in the current period. Period-End Closing o Single Functions o Work in Process o Individual Processing o Calculate Enter the production order number. Enter the current period in the WIP to period field. Enter the current fiscal year in the Fiscal year field. Select RA version and enter version 0. Deselect Test run. Select Log information messages. Choose Execute.
2-5
Using the WIP report, display the WIP value that has been calculated for your production order. Information System o Reports for Product Cost by Order o Detailed Reports o For Orders Enter the production order number, select Cumulated as the time frame, and choose Execute. Switch to the layout Work in Process (1SAP03).
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2-6
Settle the work in process for your production order to FI and PCA. Period-End Closing o Single Functions o Settlement o Individual Processing Enter the production order number. Enter the current period in the Settlement period field. Enter the current fiscal year in the Fiscal year field. Select Automatic in the Processing type field. Deselect Test run. Choose Execute. To display the settlement, first choose Detail lists. To display the FI documents and profit center documents on the receiver screen, position the cursor on the order number and press Accounting Documents. Select the accounting document by double-clicking. Return to the list of accounting documents and select the profit center document by double-clicking.
2-7
From this point onwards, we will assume that production is completed. Execute the final confirmation for operation 60 for the remaining 60 units from the production control menu. Logistics o Production o Production Control o Confirmation o Enter o For Operation o Progress Confirmation. Enter the order number. Enter operation 60 and press Enter. Choose Final confirmation. Verify that the yield to confirm is 100. Save the confirmation.
2-8
Review the actual costs posted to the production order from the confirmation. Information System o Reports for Product Cost by Order o Detailed Reports o For Orders Enter the production order number, select Cumulated as the time frame, and then choose Execute (layout GR##). Additional debits for the production activities and a credit for the delivered quantity of 60 units must have been assigned to the order.
2-9
The order now has final delivery status. Execute WIP calculation again to determine the cancellation amount. Note: Since the period has not changed during our course since the last period-end close, the result of WIP calculation is not the cancellation amount but the current WIP value of 0. Period-End Closing o Single Functions o Work in Process o Individual Processing o Calculate
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Enter the production order number. Enter the current period in the WIP to period field. Enter the current fiscal year in the Fiscal year field. Select RA version and enter version 0. Deselect Test run. Select Log information messages. Choose Execute. The WIP value must be 0. 2-10
Calculate the variances for your production order for the current period. Period-End Closing o Single Functions o Variances o Individual Processing Enter the production order number. Enter the current period in the Period field. Enter the current fiscal year in the Fiscal year field. Select Selected target cost versions 000. Deselect Test run. Select Detail list. Choose Execute. In the variance calculation list, position the cursor on the order number and choose Cost elements to see the variances by cost element. If you want to check the variance categories for a variance amount, either double-click on the variance amount or position the cursor on a variance amount and choose the symbol i Variances in the toolbar.
2-11
Now execute order settlement to allocate the order balance, the WIP cancellation amount, and the variances to FI, PCA, and CO-PA. Period-End Closing o Single Functions o Settlement o Individual Processing Enter the production order number. Enter the current period in the Settlement period field. Enter the current fiscal year in the Fiscal year field. Select Automatic in the Processing type field. Deselect Test run. Choose Execute. To display the settlement, choose Detail list. Choose Detail lists to display the settlement data to FI and to Profitability Analysis. Choose Detail list of accrual data for FI to see the results analysis data (WIP cancellation). To display the FI documents and profit center documents on the receiver screen, position the cursor on the order number and press Accounting Documents. Select
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the accounting document by double-clicking. Display the profit center document and the profitability analysis document in the same way.
Optional: Manufacturing has produced another 60 units of material T-F1## that are now in your warehouse. You can deliver these units to your customer and produce an invoice for the delivery, which sends additional revenues (and cost of sales) into Profitability Analysis. For the solution to this exercise, see exercises 6-2 to 6-3 in the previous unit "Transaction-Based Postings in CO."
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Unit: Period-End Postings in CO Topic: Selling Goods and Services
•
You learn the difference between selling a product from stock and selling a product (or service) that was produced specifically for a particular sales order.
The company receives an order from a customer to deliver pumps. In addition, pumps are to be installed at the customer’s site.
3-1
Create item in sales order 3-1-1 Create a second item in the sales order. Logistics o Sales and Distribution o Sales o Order o Create Select the item overview. Enter material T-SERVICE. Enter 100 in the Order quantity field. 3-1-2 Switch to the account assignment view for the pump installation. Select the service item. (Click on the item number) Choose Account assignment. Check the fields. Delete the results analysis key! Choose Display account assignment (to the right of the Profitability segment field) to see the characteristic values transferred to CO-PA. To return to the tab Account assignment, choose Continue. 3-1-3 Check the value for condition type PR00 (price) for the pump installation. Switch to the Conditions tab. Check the entry PR00 in the column CnTy. Remain in the Conditions tab for the next exercise. 3-1-4 Determine the cost of the installation service. Choose the Costing symbol.
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In the screen Create Cost Estimate, enter PC04 as the costing variant and T-SERVICE as the base planning object. Choose Continue. The costing items are displayed. Save the cost estimate. If the condition view is not displayed automatically, select the service item again and choose Conditions. 3-1-5 Check the schedule lines for the pump installation to see the confirmed quantity. Save the sales order. Switch to the Schedule lines tab and check the confirmed quantity. Choose Save. 3-2
Create a direct activity allocation to allocate 100 hours of activity type 1421 and 20 hours of activity type 1420 from cost center 4230 to your sales order. Logistics o Sales and Distribution o Sales o Sales Order - Controlling o Actual Postings o Activity and Business Process Allocation o Enter Enter the current date in the Document date field. Enter 0 in the version field. Select Sales order/cost object in the screen variant field, and select List entry. Enter 4230 in the Send. CCtr. column. Enter 1421 in the SAtyTyp column. Enter your sales order number in the RecSaleOrd field. Enter item number 20 in the RecItm field. Enter 100 in the Total quantity column. Enter 4230 in the Send. CCtr. column. Enter 1420 in the SAtyTyp column. Enter your sales order number in the RecSaleOrd field. Enter item number 20 in the RecItm field. Enter 20 in the Total quantity column. Choose Post.
3-3
Bill the customer for the installation. 3-3-1 Create the invoice for the sales order item. Logistics o Sales and Distribution o Sales o Order o Subsequent Functions o Billing Document Enter your sales order number in the first row of the Document column. Choose Save. 3-3-2 Display the accounting documents for the billing document. What is the document type of the accounting document? Choose Billing document → Display
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Enter the billing document number. Choose Accounting. Select the accounting document and go to the document header. The document type is RV (transfer of billing documents). Exit the transaction. 3-4
Allocate the overhead to your sales order. Logistics o Sales and Distribution o Sales o Sales Order - Controlling o Period-End Closing o Single Functions o Overhead Verify that your sales order document number appears in the Sales document field. Enter your service item number in the sales document item field. Enter the current period in the Period field. Enter the current fiscal year in the Fiscal year field. Deselect Test run. Select Detail lists. Choose Execute. Choose Back.
3-5
Execute the Plan/Actual Comparison report for your sales order. Logistics o Sales and Distributiono Sales o Sales Order - Controlling o Information System o Reports for Product Cost by Sales Order o Detailed Report o For Sales Order Verify that your sales order number appears in the Sales order field. Enter your service item number in the Item field. Choose Execute. Choose Back.
3-6
Settle your sales order document to CO-PA. 3-6-1 Run a test settlement. Logistics o Sales and Distribution o Sales o Sales Order - Controlling o Period-End Closing o Single Functions o Settlement Enter 1000 in the Sales organization field. Verify that your sales order number appears in the Sales document field. In the Settlement period field, enter the period in which your billing document was posted. Enter the current fiscal year in the Fiscal year field. Select Test run and Detail list. Choose Execute. Check the results.
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If there were no errors, go back to the screen Actual Settlement: Sales Orders. Deselect Test run. Choose Execute. 3-6-2 Check the CO-PA document generated by the settlement. Click on the item with the profitability segment receiver and select Receiver debits. Choose Accounting documents. Double-click on the document type for profitability analysis to see the posting to CO-PA. You see the characteristic values. Choose Value fields and use the Next screen and Previous screen functions to see the data transferred to Profitability Analysis for this sale.
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Unit: Period-End Postings in CO Topic: Profitability and Sales Accounting
•
Look at the results in various market segments.
•
Use drilldown reporting to analyze the data for different profitability segments.
After the production and sales transactions have been recorded, you would like to look at the results for different market segments. You want to know where your profits rose and where they fell, and analyze the causes of these changes. This information is required not only at the end of the period, but also after each sale.
4-1
Select line items for your User ID and the number of your sales order. Accounting o Controlling o Profitability Analysis o Actual Postings o Display Line Items In the Set Operating Concern screen, enter IDEA in the Operating concern field. Choose Continue. Enter C to F in the Record type field. Enter yesterday’s date in the Date created field. Enter the current date the Date created to field. Enter your User ID in the Entered by field. Choose Execute. Choose Yes to clear the message regarding the selection criteria. Double-click on a line item for a detailed view.
4-2
Examine the results for your company. Execute contribution margin report AC040 for the current fiscal year. 4-2-1 Execute the report. Accounting o Controlling o Profitability Analysis o Information System o Execute Report If you are asked to enter the operating concern, enter IDEA and choose Continue. From the list of reports, select AC040 by double-clicking. Enter the current fiscal year in the Fiscal year field.
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Enter 100 in the version field. Choose Execute. 4-2-2 Select the overview and drill down in the report to see the results. Click on Drilldown list in the navigation area. Click on Plant in the navigation area. Click on the diamond symbol to the left of 1000 Hamburg. Click on Division in the navigation area. Click on the diamond symbol to the left of 01 Pumps. Click on Product in the navigation area. Click on the diamond symbol to the left of T-F1##. Click on Customer in the navigation area. 4-2-3 Display the same information for the pump installation service. Click on Back in the navigation area to return to the division level. Click on the magnifying glass to the left of 1000 Hamburg. Select plant 1200 Dresden by double-clicking. Click on the diamond symbol to the left of 08 Services. Click on Product in the navigation area. Click on the diamond symbol to the left of T-SERVICE. Click on Customer in the navigation area. 4-2-4 Drill down on the actual line items. Click on the report row for customer 1000 in the actual revenue column. Choose Gotoo Line items. Double-click on one of the lines that your group entered to view detail. 4-2-5 Look at contribution margin 2 for all products that you delivered to customer 1000. Click on the red cross to bring all four characteristics back to the navigation area. Select the characteristic Customer and then customer 1000.
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Unit: Period-End Postings in CO Topic: Reconciliation Ledger
•
Analyze the cost flow between different business areas to see data that was allocated in CO but is not reflected in FI.
The company has different business areas within the controlling area. Some allocations within CO will cross business areas; however, this information is not immediately updated to FI. Since the business area is one of the levels at which data is reported in FI, this information must be reconciled between CO and FI.
5-1
In the information system in Cost Element Accounting, run the appropriate report to analyze cost flows between business areas. Look at the cost flow between the business areas to which our production and service cost centers are assigned (1000 and 9900, respectively). 5-1-1 Execute the report Cost Elements: Allocations Between Business Areas for the current period for all business areas in controlling area 1000. The default value in the business area field includes all business areas. You can accept this setting or enter the interval 1000 to 9900.
Accounting o Controlling o Cost Element Accounting o Information System o Reports for Cost and Revenue Element Accounting o Cost Flow o Cost Elements: Allocations Between Business Areas Enter 1000 in the Controlling area field. Enter the current fiscal year in the Fiscal year field. Enter the current period in the Period field. Under Selection groups, enter the values 1000 to 9900. Execute the report.
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5-1-2 To view the appropriate report, set the business area to 1000 Mechanical Engineering and the trading partner business area to 9900 Corporate Other. Explain the displayed data. Under Variation: Characteristics, select Business area. In the list of business areas, select 1000 Mechanical Engineering. The setting for Business area should now be 1000. Under Variation: Characteristics, select Trdg part. BA. In the list of business areas, select 9900 Corporate Other. The setting for the trading partner business area should now be 9900. The report shows the flow of costs between business areas, summarized at the cost element level. These costs will be reconciled to FI at the end of the accounting period before the financial statements are produced.
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AC040 Cost Management and Controlling AC040
Release 46C 08/17/2001
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ASAP Introduction: Unit Objectives
Upon completion of this unit, you will be able to: z Explain the difference between TeamSAP, ASAP, and the Implementation Assistant z Describe the structure of the Implementation Assistant z Perform the first steps in the Implementation Assistant
z State what deliverables are produced in an ASAP project
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Overview Diagram: ASAP Introduction
ASAP Overview ASAP Introduction
Content / Tools of the ASAP Phases
Legend: Unit Unit Topic Topic
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Topic: ASAP Introduction
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Topic Objectives
Upon completion of this topic, you will be able to:
z Describe the relationship between TeamSAP and ASAP z Describe the role of the BE tools in ASAP
z State the preconditions for rapid implementation with ASAP
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AcceleratedSAP …the process component of TeamSAP
People: Solutions Expertise
Processes: AcceleratedSAP
SAP Consulting Partners Complementary Software Partners Technology & Hardware Partners
AcceleratedSAP Roadmaps or Powered-By Methods Quality Assurance R/3 Business Engineer Support, Consulting & Education Services
Products: The Business Framework
R/3 Product Family Complementary Software Products Technology Partner Products Industry Solutions SAP AG 2001
The TeamSAP
product with:
program is SAP’s contribution to ensuring total lifecycle success in using the R/3
y Reinforced involvement of SAP employees in projects
y Coaching across the whole lifecycle: for example, feeding customer concerns into the SAP network, supporting projects actively, and helping reduce costs y Quality assurance (reviews) for all projects.
TeamSAP
works by providing a coordinated network of people, processes and products from SAP and partners.
ASAP
is the TeamSAP solution for the implementation process, with a simple, consistent project plan linked with the tools, services and support for implementing the R/3 System.
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What is in ASAP? ASAP ASAP Accelerators Accelerators Individual Individual accelerators accelerators also used in also used in other other projects projects
z Roadmap
Step-by-step procedures and recommendations
z Tools
ASAP Implementation Assistant:
Navigation tool for the Roadmap, questionnaires, templates, and check lists Q&A database for documenting requirements
R/3 Business Engineer tools for creating Business Blueprint (conceptual design) and for configuration
z R/3 Services and Training
All the services are available for ASAP projects, including consulting, training, hotline, EarlyWatch, OSS, Info DB.
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AcceleratedSAP - The Implementation Solution
ASAP Roadmap Project Preparation Business Blueprint
Continuous Change
Final Preparation
Realization
Go Live & Support
Methodology Methodology
Implementation Assistant - Q&A database - ASAP Roadmap - Knowledge PC PC Tool Tool Corner - BP Master List - Accelerators
R/3 Business Engineer
R/3 R/3 Tool Tool
- Implementation Guide - Reference Model - Profile Generator - Change Request Management
Service Training & Education, InfoDB, OSS Support, Consulting SAP AG 2001
AcceleratedSAP is the
Implementation Solution provided by SAP. AcceleratedSAP integrates several components that work in conjunction to support the rapid and efficient implementation of the R/3 System. The three components that make up AcceleratedSAP are: y Methodology - The AcceleratedSAP Roadmap defines the phases of the R/3 implementation process and supports those with a comprehensive project plan. These MS Project templates provide complete work breakdown structures and resource assignments.
y Tools - The AcceleratedSAP process is supported by a comprehensive set of both PC-based and R/3-resident tools. y Service
- The PC-based tools and accelerators are integrated into the Implementation Assistant (IA). The Implementation Assistant seamlessly links documents accessed through the AcceleratedSAP Roadmap. The major PC tools include: - The Question & Answer Database (Q&A db) - A repository of all questions and corresponding Company responses that are required to define business requirements and to develop the business solutions in terms of the R/3 Reference Model and the R/3 System. This includes business process, technical, organizational, and configuration questions and answers that are the source for creating the Business Blueprint. After answering questions and filling out customer input templates within the Q&A db, the Business Blueprint is generated and printed. - The Roadmap - A set of processes that identifies the steps needed to implement R/3. The five phases of the AcceleratedSAP Roadmap (represented by a road graphic) are Project Preparation, Business Blueprint, Realization, Final Preparation and Go Live and Support.
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Preconditions for Rapid Implementation
z Clearly defined and stable project scope
z Only reference based reengineering z Implementation uses standard R/3 functions z Whole company fully committed
Committed management (steering committee) and fast decision-making Committed project team, competent, well-trained users and decisionmakers
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Topic: Content / Tools of the ASAP Phases
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The Implementation
Assistant is:
y A PC tool that can run completely independently of the R/3 System
y The one-stop collection of all tools and methods developed for the ASAP methodology y Network-capable
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Home Page: What’s
Branches back to the Roadmap graphic in the right pane.
New: Delineates version and release changes.
Roadmap: A
set of processes that identifies the steps needed to implement R/3. The five phases of the AcceleratedSAP Roadmap (represented by a road graphic) are Project Preparation, Business Blueprint, Realization, Final Preparation and Go Live and Support.
Implementation Project Plan: 6
Accelerators: Alphabetical listing of accelerators found within the Roadmap.
or 9 month project plans.
Question
and Answer Database (Q&A db): A repository of all questions and corresponding Company responses that are required to define business requirements and to develop the business solutions in terms of the R/3 Reference Model and the R/3 System. This includes business process, technical, organizational, and configuration questions and answers that are the source for creating the Business Blueprint. After answering questions and filling out customer input templates within the Q&A db, the Business Blueprint is generated and printed.
Issues
Database: Tool used to process and track project issues.
Business Process Procedures: Lists default
business processes from the R/3 System.
Knowledge
Corner: Task-oriented collection of efficient procedure documentation for use in the R/3 implementation project (examples: authorization concept, data transfer).
Help:
Source for ASAP support and updates.
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The Roadmap,
folders:
Phase
regardless of the method of access, is divided into four types of organizational
- The major organizational steps of the ASAP Roadmap.
Work
package - A group of activities designed to accomplish a major portion of a Roadmap phase. A work package is assigned to a project team for completion.
Activity - A
group of tasks. The results of an activity can produce certain deliverables and can be accomplished by one or more project team members. Several activities comprise a workpackage.
Task
- A specific event to be performed by a project team member.
y Tasks contain the important How To instructions needed for task completion and provide access to the accelerators: - How-To - Explanation of how to perform a process, activity, or task. - Accelerator – Documentation, templates, tips and tricks used to accelerate task completion.
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The Knowledge
© SAP AG
Corner contains many publications from SAP’s Simplification Group.
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Phase
1 focuses on:
y Getting the project started
y Identifying team members
y Developing a high-level plan
y In the kickoff meeting, the project team and process owners get a clear sense of what their responsibilities will be throughout the project.
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Phase
2 focuses on understanding the business goals of the company and determining the business requirements needed to support those goals.
During Phase 2,
consultants will be using the AcceleratedSAP Implementation Assistant, The Question & Answer Database, and VISIO’s Business Modeler to gather requirements.
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Specific
tasks within the work packages provide direct access to the Q&A db for task completion. Within the Q&Adb, questionnaires and templates provide the means for task completion as well as data storage of results and report generation.
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The Implementation
this process.
Assistant gives you both guidance and specific directions on the execution of
The Enterprise
IMG is the complete IMG for your company. It includes all components to be implemented now and in the future. If a certain module, or function within a module, is still under consideration, include it in the Enterprise IMG so that regeneration is not needed later. Although regeneration is possible, it can be time consuming because it requires system resources. Be careful if you regenerate the Enterprise IMG, because all Project IMGs will be affected.
The purpose of the Project IMG is to
provide a specific set of configuration activities for each project phase, so that all SAP application components that go live at the same time are included in one Project IMG for the customer, even when there are several locations, or multiple project teams. The Project IMG substantially reduces the number of IMG activities.
All
available IMG activities are assigned to one or more components. For instance, if you select Production Planning (PP), there is a branch Controlling, even when you do not use this component, because PP needs cost centers for its work centers. Use Project IMGs to do your project planning and control work.
When
you set up your Project IMGs or Release projects, be sure to keep to the standards you defined in the Project procedures work package under the Define project documentation task for using status indicators, for scheduling, and for documentation.
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The purpose of
Phase 3 is to develop and evolve a future-state model into an integrated and documented solution that fulfills the customer’s business process requirements.
Configuration
is done in two work packages:
y Baseline configuration y Final configuration
Baseline configuration
provides the basis for the configuration cycles. The system is refined in the Final configuration work package.
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Activities In
are uniformly documented.
the IMG you can create complete (project) documentation for each activity.
Note:
From Release 3.1G there is a translation option for language-dependent fields in Customizing transactions. You can define or change any language. Fields can be translated into several languages simultaneously.
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Phase
4 focuses on completing final system testing, training users and cutting over both the data and the system to a production environment.
Final
system testing consists of:
Testing conversion
procedures and programs, and interface programs
Conducting volume
and stress testing, and final user acceptance testing.
y In this phase, you also develop a Go Live plan, which specifically identifies the data conversion strategy, initial audit procedures and a project team support structure.
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After
Go Live, the customer team is focused on supporting the users. The consultants should be secondary to this effort. y Each day the business results and system performance should be measured and reviewed.
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What Were the Course Goals? This course: z Provides you with basic knowledge of the components of Controlling (CO) in R/3 z Explains the integration between CO and other R/3 components z Explains the different costing methods used in CO z Helps you decide which R/3 tools to use depending on the cost accounting methods used in your enterprise z Familiarizes you with SAP terminology z Describes further training requirements and prepares you for the corresponding training courses
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What Were the Course Objectives? At the conclusion of this course, you will be able to: z Execute the core CO functions
z Identify the components of CO that address different business requirements z Explain the integration within CO
z Explain the integration between CO and other R/3 components z Explain SAP terminology
z Decide which R/3 CO tools to use in given business situations
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Overview
$ t Reporting Tools
+ ABC Planning and Integrated Planning
HR
MM
FI
SD AA
CO DM DM
Postings to CO from Other Components
9
12
$
Transaction-Based Postings in CO
OM PC Profit Representing Your Business in CO
CO 1
AC040
1 12 OM PC Profit FI CO
INT EXT OM PC Profit
Period-End Postings in CO
FI MM HR AA SD
Overview of Controlling
“Where now?" Navigation
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ASAP: Introduction
Introduction
AC040
Summary
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Recommended Follow Up Courses (AC410)
z AC410 - Cost Center Accounting covers : z Organizational Units z Master Data z Event-Based Postings z Period-End Closing z Planning z Information System z Special Functions
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Recommended Follow Up Courses (AC505)
z AC505 - Product Cost Planning covers: z Introduction to and Preparation for Product Costing z Material Costs z Production Costs z Overhead z Process Costs z Update in the Material Master z Special Types of Processing z Costing Run z Costing Without a Quantity Structure SAP AG 2001
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Recommended Follow Up Courses (AC605)
z AC605 - Profitability Analysis covers: z Introduction to and Preparation for Product Costing z Overview of Profitability Accounting z Basic Data Structures z Characteristics Derivation and Valuation z Flow of Actual Data z Sales & Profit Planning z Information System z Technical Topics
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Recommended Follow Up Courses (AC610)
z AC610 - Profit Center Accounting covers: z Overview of Profitability Accounting z Basic Settings z Actual Data z Transfer Prices z Profit Center Planning z Information System
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Finish
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