Professional Documents
Culture Documents
White Lotus
Contents
1. Unit Summary ................................................................................................. 3 2. Overview of topics covered............................................................................. 3 3. Business process ............................................................................................. 3 4. Flows of Actual Values..................................................................................... 3 5. Integration with sales order management ...................................................... 4 6. Transfer of Overhead .....................................................................................22 7. Direct Posting.................................................................................................31 8. Value Flow from cost object...........................................................................39
White Lotus
1. Unit Summary
This unit will familiarize audience to understand how actual values flow into CO-PA. It also explains how condition type, transfer and allocation cost helps to move actual values in to COPA. In addition, it provides an over view of settlement orders and discusses direct postings, variance calculation.
Overview of Operating Concern and its Attributes Explains the flow of Actual data in to CO-PA Sources of value field Concept of transfer of billing document Concept of direct posting Concepts of transfer & allocation cost Concept of settlement of orders
3. Business process
ACL wants to calculate the contribution margin based of cost of goods sold, for this reason all the values posted through other modules should flow through CO-PA.
ACL wants to calculate the actual contribution margin based of cost of goods sold, for this reason all the values posted through other modules should flow through CO-PA. ACL would like to understand the data flow to evaluate suitability of SAP COPA module for its requirements.
4.3
White Lotus
The system uses the flows of actual values to transfer data from other modules like the FI (G/L account postings), MM (invoice receipts, purchase orders) and SD (sales orders) application components to profitability segments. Revenues and sales deductions are transferred into profitability segment for analysis at the time of billing in sales and distribution module. Quantities sold also valuated at the same time with standard cost estimate. All this values flow at same time which is actual data flowed into CO-PA. For period-end closing, internal activities are assigned to profitability segments, assess cost center costs and business process costs to profitability segments, as well as settle orders, projects and cost objects to profitability segments. The value fields in the costing-based CO-PA contain the amounts and quantities that are required for report. They represent the finest level of detail at which costs and revenues are broken down. One of the most important tasks in Customizing for the costing-based CO-PA is to assign companies costs and revenues to the required value fields. This enables to calculate the contribution margins that once organization requires in the Information System.
ACL wants to understand how Sales orders in different sales scenarios are integrated with COPA
5.2
Transfer of billing document to CO-PA. The sales order management module can handle the following business functions in SAP like quotation, order, delivery and billing. Each of these areas has its own sales documents, which contain the relevant data for that activity. The central document in sales order management is the sales order. This order may be based on the existing inquiries and customer quotations. When you create an order, the information about the customer and the products or services sold is stored in the document. The following information is passed on to all the subsequent documents created for this business transaction:
White Lotus
The delivery is created when the product is shipped to the customer, which means the goods issue. A billing document is created to bill the customer for the goods or services provided.
This is standard process in the SAP system and the starting point for the data transfer to CO-PA. In some cases, data is transferred to costing-based and account-based CO-PA at different times using different valuation approaches. Transfer of incoming sales order Sales order are the source of revenue for the SAP system coming from the SD module based on the transfer of billing document. The sales order information is extracted based on four components: Sales quantity, sales Revenue, Rebates, and Net Revenue. Incoming sales orders are looked as expected revenue and transfer this data from sales order and to costing based CO-PA to obtain advance analysis of anticipated profits. As a result not only actual profits and contribution on the base of billing documents but also it allows to analyzing developments information on the basis of incoming orders. To analyze incoming orders, indicate the record type, A, in the report. To analyze billing data, indicate the record type, F. Note: If Profitability Analysis is activated after company has gone productive with Sales Order Management, you can post the existing sales orders for the current or past periods subsequently to CO-PA. Another function is available to identify the sales orders that are already assigned to a profitability segment although the order was not yet active and to transfer these orders to COPA. Goods issue / Posting Delivery The goods issue is triggered when delivery is done against sale order. This generates an accounting document by crediting stock and debiting cost of goods manufactured. Note: Notice that the goods issue posting does not cause any data to be posted in costingbased CO-PA. The cost of goods sold is only transferred to costing-based CO-PA when the billing document is transferred.
White Lotus
Billing A business transaction normally ends with billing process in sales cycle generating billing document. The billing data is transferred automatically to accounting by debiting Customer and Crediting revenue. When a billing document is created, Sales Order Management calculates all sales revenues, sales deductions, and other values, such as the standard cost using pricing procedures, and stores these values in condition types. By assigning these condition types to the value fields in Profitability Analysis, you can have the system automatically transfer their values to CO-PA. The billing data is transferred to Profitability Analysis with the record type, F. In addition, quantities can be transferred from the Sales Order quantity fields, such as the sales quantity or gross weight, by assigning them to the corresponding quantity fields in CO-PA. Condition type Pricing Procedure A pricing procedure defines the conditions that are permitted for a particular document and the sequence in which the system takes these conditions into account during pricing. In addition, assign the pricing procedures to the transactions by defining the following dependencies: customer, sales document type, or sales area. In the pricing procedure, you define which condition types should be taken into account and in which sequence. During pricing, the SAP System automatically determines the pricing procedure that is valid for a business transaction and it takes the condition types contained in it into account one after the other. A condition type is a representation in the system of some aspect of your daily pricing activities. For example, you can define a different condition type for each type of price, discount, or surcharge that occurs in your business transactions. A condition table defines the combination of fields that identifies an individual condition record. A condition record is how the system stores the specific condition data that is enter in the system as condition records. For example, when price is entered for a product or a special discount for a good customer, an individual condition records is created An access sequence is a search strategy that the system uses to find valid data for a particular condition type. It determines the sequence in which the system searches for data. The access sequence consists of one or more accesses. The sequence of the accesses establishes which condition records have priority over others. The accesses instructs the system where to look
White Lotus
first, second, and continue in this way until it finds a valid condition record. Specify an access sequence for each condition type for which condition records is created. All revenues, sales deductions, and other values (such as transfer prices) are defined as conditions in SD. These conditions are assigned to the corresponding CO-PA value fields, with limitations, to transfer billing document to CO-PA.
Transaction code
White Lotus
Fields Condition Type Value Field Data to be filled PR00 ERLOS
Click on save
White Lotus
5.3 Demonstration
To test value fields mapped to condition type, create sales order with following data.
Fields Order Type Sales Organization Distribution channel Division Sold to party Ship to party Material Quantity
Using the following menu path or transaction code to execute the following transaction. Menu Path Transaction code Accounting - > Logistics -> sales and distribution-> Sales -> Order -> Create VA01
White Lotus
White Lotus
Save the order by clicking Now do delivery for sales order by choosing fields as shown in the screen
Enter the sales order no and shipping point by giving selection date and click enter and click on Post Goods Issue tab to generate accounting entry.
COPA - Actual Data Flow Page 11
White Lotus
Here you can see the related documents with respective to sales order.
White Lotus
To see CO-PA document place cursor on Invoice line and click on display Next click on the accounting tab which is highlighted in the screen below
You can see the documents related to FI/CO below, select the profitability analysis document and click on
White Lotus
Here you see all the characteristics updated from the sales order and by derivation rule
White Lotus
White Lotus
5.4 Self Assessment Test
1. _________________ in the costing-based CO-PA contain the amounts and quantities. 2. A pricing procedure defines the conditions that are permitted for a particular document and the sequence a. True b. False 3. CO-PA document are generated at the time of _________________ in sales process.
White Lotus
5.5
Exercise
Create a journal entry in financial accounting to transfer values into CO-PA. Company Code Sales Commission GL account Bank GL Account Amount Customer Sales Organization Division Distribution Channel AA01 45#### 11#### 10,000 1000## 10## ## ##
5.6
Solution
Use the transaction code or menu path to post document Menu Path Transaction code Accounting - > Financial Accounting -> General Ledger -> Posting FB50
The following screen is populate to make a journal voucher booking along with transferring values to CO-PA
White Lotus
After filling the fields need to enter CO-PA values by clicking Profitability Segment tab.
Once the Profitability analysis screen is opened enter the required characteristics and click on derivation to derive rest of fields.
White Lotus
Page 19
White Lotus
You see all the values derived automatically, now COPA got updated with required values, click on
Now document is ready with debits and credits, so save document by clicking
White Lotus
To display the COPA document entered follow the shown steps below. Display the FI document posted and selects the tab from menu environment, document environment and accounting document.
White Lotus
6. Transfer of Overhead
6.1 Relevance to business process
ACL limited wants to transfer overhead costs from cost centers such as administration, Finance, Human resources etc. to COPA. The cost are to be booked at business division level only. 6.2 Configuration / usage consideration
Transfer of Overhead Costs: Overview To reflect all the actual costs from Overhead Cost Controlling in Profitability Analysis, need to transfer the cost center costs and business processes which are not directly attributable to the production process. Transfer these costs to profitability segment. Perform direct or indirect allocation of internal activities for the cost center and the business processes in CO-PA. Along with the sender, which means the cost center or process and the receiver, which means the profitability segment, enter the quantity of the activity performed and valuate it with the planned price of the activity type. The amount that is arrived at is credited to the sender and debited to the profitability segment receiving the quantity. This means that a transport activity can be directly posted to particular customers without the need to be posted to a cost center or an order.
Activity allocation
Overhead cost can be transferred from cost center accounting to either on an activity-allocation or a periodic basis. Transfer these activities either directly or indirectly to Profitability Analysis. PA transfer structure can be used to control the secondary cost element of activity allocation in the value fields for costing-based profitability analysis. It is possible to allocate the costs for internal activities directly to profitability segments. To do so, you need to specify the sender and receiver along with the quantity of the activity provided. This quantity is automatically valuated with the planned price for that activity type, and the resulting amount is credited to the cost center providing the activity and debited to the receiver profitability segment.
COPA - Actual Data Flow Page 22
White Lotus
In this way, the man hours of a sales employee, for example, can be posted directly to the specific customer groups or divisions for which the service was provided. This does not necessitate the use of cost centers or orders
Settlement of Orders
In SAP system, internal orders (CO), sales orders (SD), projects (PS), and production orders (PP), can be settled to profitability segments. Make clear that essentially settlement to Profitability Analysis always follows the same pattern. Here, the settlement process is demonstrated using an internal order. An internal order, which captures the costs for a trade fair or collects the various marketing costs, such as that of TV, radio, and newspapers for each product, and settles them to Profitability Analysis. In a settlement profile, it is define that which receivers are allowed for order settlement. Define a default settlement structure and a default PA transfer structure. When an order is created,
COPA - Actual Data Flow Page 23
White Lotus
specify an settlement profile in order type. The system uses this order type to determine which settlement profile and, as a result, which settlement structure and PA transfer structure to use. In account-based CO-PA, costs are settled to the settlement cost element specified in the settlement structure. In costing-based CO-PA, costs are settled from the original cost elements to the value fields to which they are assigned in the PA transfer structure. The PA transfer structure contains the assignment of costs and revenues to the value fields in costing-based CO-PA. PA transfer structures are used in order settlement, direct postings from FI, and the internal activity allocations in Management Accounting. A PA transfer structure consists of any number of assignment lines. Each assignment line contains the assignment of one interval or a group of cost or revenue elements to the required value field. A PA transfer structure must meet the following criteria: It must be complete: All the cost and revenue elements that can receive costs or revenues must be assigned to a value field in the PA transfer structure. The assignments must be unique: Each cost or revenue element can only occur one time within a PA transfer structure. Allocation Structure: During settlement, the costs incurred under the primary and secondary cost elements by a sender are allocated to one or more receivers. When you settle by cost element, you settle using the appropriate original cost element. An allocation structure consists of one or several settlement assignments. An assignment shows which costs (origin: cost element groups from debit cost elements) are to be settled to which receiver type, such as cost center and order. You have two alternatives in settlement assignment: You can assign the debit cost element groups to a settlement cost element. You can settle by cost element, which means the debit cost element is the settlement cost element.
White Lotus
6.3 Demonstration
Creation of settlement profile Menu Path Transaction code IMG- > Controlling -> Profitability Analysis ->Flow of Actual Value >Transfer of Overheads -> Settlement of Overhead OKOA
ZZ01 Select A1
White Lotus
PA Transfer Structure % Settlement Equivalence Number Profit Segment E1 Check Check Settlement Required
Click on save
White Lotus
6.4 Self Assessment Test
1. PA transfer structure consists of only one assignment line? a. True b. False 2. Which of the following are included in settlement profile? a. Allocation Structure b. Budget Profile c. PA Transfer Structure d. Source Structure e. Planning Profile
White Lotus
6.5 Exercise
View the entry you just created in the costing-based CO-PA. Which record type do you use to view the posting?
White Lotus
6.6 Solution
Use the following menu path or transaction code to display COPA Document Menu Path Transaction code Accounting - > Controlling -> Profitability Analysis ->Actual Postings Display Line item KE24
Give the document no which you would like to display characteristic and value fields updated and execute the transaction.
White Lotus
In below screen you can see the record type B is highlighted, which will be used for manual FI updating COPA.
White Lotus
7. Direct Posting
7.1 Relevance to business process
In your Company you usually pay sales commission to the employees on there performance. These transactions are booked through FI journal vouchers. You company wanted to take this value in CO-PA for calculating contribution margin.
7.2
Direct postings from FI or MM can be configured in CO-PA to identify revenues and costs for record type B. The revenue component of MM appears when there is inventory that can appreciate. In addition, you can transfer expenses, such as gifts to customer, special promotions, or samples. Note that these are not costs, because they are never billed to a customer as part of a sale, but rather expenses of your operation. For direct postings in Financial Accounting, all the assignments of values and quantities to the value fields in costing-based Controlling Profitability Analysis (CO-PA) are defined in the PA transfer structure, FI. System allows dual postings to both a profitability segment and a cost center; the real posting always goes to the profitability segment. The cost center is posted only for statistical purposes.
White Lotus
The transfer of inventory differences
Transaction code
Use the menu path or transaction code to create PA transfer structure Create a new structure called FI by clicking copy option. Select the FI structure created and click an assignment lines tab which is on left hand side.
Select the assignment line 40 and click on Source tab which is on the left hand side
White Lotus
Enter the source values like Cost element or Cost element group. Next click on Value fields tab and enter the COPA value fields which you need to update.
In our example we are updating value field VV365 which is price difference
White Lotus
7.3 Self Assessment Test
1. Manual Postings into CO-PA through FI/MM is possible c. True d. False 2. CO-PA document are generated at the time of _________________in sales process.
White Lotus
7.4 Exercise
Enter a price that is higher than the currently displayed price of your material and save. In accounting system generates FI document for price difference, it should also transfer values to CO-PA. Show the FI and COPA document
Fields Posting Date Company Code Plant Material New Price Data to be filled Current date AA01 AA01 P-100## Increase 100 on current value
White Lotus
7.5 Solution
Use menu path or enter transaction code to go to price change screen Menu Path Logistics - > Material Management - > Valuation - >Price Determination -> Change Price MR21
Transaction code
Enter the details given the above screen and click enter
Change the price of material in the new price field which is highlighted in the below screen, in current statistic field it shows current price of material.
White Lotus
Select the accounting document tab to see all the FI/CO document generated at the time of posting price difference document in MM
White Lotus
The following screen shows the FI/Co documents, which contains Profitability analysis document as well.
White Lotus
8. Value Flow from cost object
8.1 Relevance to business process
CL produces several products, all of which are valuated at standard prices. ACL would like to understand the possibilities of handling production variances in COPA.
8.2
To run closed profitability analysis for periods, you need to transfer to CO-PA at the end of the period all the variances that have occurred in that period. Variances typically occur if you valuate your materials with standard prices. At the end of the period, these standard costs are then compared with the actual costs incurred, and this comparison forms the basis for a detailed variance analysis. The variances are finally transferred to CO-PA at the end of the period to produce a factually correct representation of the results. While the variances for production cost centers flow into CO-PA during cost center assessment, the variances for cost objects are transferred to CO-PA when production orders, for example, are settled. For a description of how variances arise and what causes them, see the documentation on Cost Object Controlling. Order-Related Manufacturing- Variance Calculation
This topic demonstrates cost object controlling using the logistic scenario of order-related manufacturing. The controlling view is controlling by lot size. The process may have the steps discussed here. When the cost object is created, a preliminary cost estimate will be carried out automatically to calculate the planned costs for the cost object. Actual costs are incurred when the materials from stock or activity types of cost centers are consumed. Primary costs can be posted directly from the other system components to production process. When the produced goods are delivered to the stock, the cost object is credited with the value of the delivered quantity and the goods are capitalized in inventory. Depending on the method of price control, this may result in a revaluation of the finished goods inventory. In this example, you use a standard price controlled material.
White Lotus
After finishing the production process or at the end of the period, the production order will be settled to a price difference account. Additional period-end closing activities may be performed: Calculation of overhead. Calculation of work in process (WIP) Calculation of variances Settlement of Variances Settle or transfer the production variances calculated in Product Cost Controlling for both final production orders as well as run schedule headers, settled periodically to Controlling Profitability Analysis (CO-PA). The individual variance categories, such as material price variance and material quantity variance, can be transferred separately. A PA transfer structure consists of one or more items called assignment lines. In these assignment lines, you assign a cost element group and a variance category to a value field of the operating concern. To assure correct settlement to Profitability Analysis, you must assign each combination of the cost element group and the variance category to one value field.
Note: Every debit cost element must be in the PA transfer structure. You can either group all the cost elements into a cost element group or define a number of groups for materials, internal activities, business processes, and other overhead costs. These groups are entered under the section, .cost elements. Every variance category must be represented in the PA transfer structure. The variance categories are specified by the system and are entered under the source section. Each debit cost element or combination of cost element group and variance category can only be assigned to one value field. Make sure that: The current standard cost estimate is selected for valuation in Profitability Analysis. The cost components of the standard cost estimate are linked to value fields.
White Lotus
Settlement of Variance to PA In account-based Profitability Analysis, how variances are updated depends on how the price difference account is defined. This account must be defined as a cost element in Management Accounting for the variances to be assigned to a profitability segment (general posting assignment logic). The account for the price difference posting is found automatically in operations. In costing-based CO-PA, you can assign these variances to the different value fields according to variance categories and cost elements. To transfer variances, the Variances flag must be selected in the settlement profile assigned to the relevant production order. Again, the costs are assigned to the value fields in a PA transfer structure. There, you can assign variance categories and cost elements to the required value fields. The system finds the profitability segment automatically in order settlement based on the information found in the production order and using characteristic derivation.
Note : Only the variances calculated in the target version, 0, can be settled to a profitability segment.
White Lotus
8.3 Demonstration
White Lotus
8.4 Self Assessment Test
1. You can settle or transfer the production variances calculated in Product Cost Controlling for both final production orders or settled periodically to Controlling Profitability Analysis (CO-PA). a. True b. False 2. Every variance category must be represented in the PA transfer structure. a. True b. False