Professional Documents
Culture Documents
1. Objectives 2. Benefits of Profitability Analysis 3. What is CO-PA 4. Integration 5. Planning 6. Reporting 7. Assumptions
OBJECTIVES
Objective
To provide an overview of Profitability Analysis (CO-PA) To understand the flow of actual data from other SAP R/3 Modules to CO-PA To introduce the Planning features in CO-PA To introduce the Reporting features in CO-PA
BENEFITS OF
PROFITABILITY ANALYSIS
reporting up-to-the-minute analysis of profitability up-to-the-minute analysis of sales management analysis of any segments of the business (products,customers, sales districts and any combination of these and other characteristics) analysis of organisational units (such as sales organisations or business areas)
WHAT IS CO-PA
Why CO-PA?
Sub-module of SAP R/3 CO (Cost Controlling) Module Flexible reporting tool to analyse companys profit and losses Freely defined slices and dices of analysis Freely defined structure of P&L sheet to match the companys requirements
Key Terminology
Operating Concern - CO-PA reporting environment. - Complex of CO-PA configuration tables and data repositories Characteristics - Criteria/Dimension for analysis of a companys profits
Profitability Segments - A unique combination of characteristic values which forms a multidimensional segment.
Billing documents
Customer
Company
Product
Which are the largest and fastest growing customers ? How have sales and contribution margins changed in the last period for each product? What are my worst and best performing sales organisations in different regions ?
Region
Sales Division
Profitability Analysis
Product Groups
Customer
Controlling Area
Controlling Area
Company Code
Company Code
Company Code
Characteristics
Distribution Channel
Customer
Product
Fixed Characteristics
User-Defined Characteristics
Profitability Segment
Distribution Channel Customer
Export
Product
ABC
CPO
CO-PA Concepts
Characteristic
What is to be evaluated? Examples: Industry Group, Product Group, Product Type, Product, Customer, Customer Group, etc
Characteristic Value
A characteristic value is a specific value of a characteristic. Examples: Customer : Customer A, Customer B Product Group: FFB, CPO, PK Customer Group: Export, Local
Profitability Segment
A profitability segment is a unique combination of characteristic values of characteristics. Examples: 1) Customer A, CPO, Local 2) Customer B, PK, Local
Value Fields
Sales Rebates Discounts
Returns Depreciation
Overhead Costs
Value Fields
G/A
Distribution
FI
FI document
An operating concern represents an organisational unit of a company. Each operating concern contains certain attributes and a data structure. The characteristic determine the content of the operating concern. An operating concern consists of a number of fixed characteristics and up to 50 user-defined characteristics. The value fields contain the transaction data of costing-based CO-PA.
Reporting Dimensions
What are the reporting dimensions required by ABC? How to determine the dimensions? Are they available in the Standard SAP Master Tables? Eg. Material Master : Material Group Customer Master : Customer Group Can they be derived from existing master data fields? Eg. Material Number -> Species
INTEGRATION
25
Population of CO-PA
SD CCA
FI
PA
PC
Direct Input
Integration Model
SD Billing Documents Sales Quantity Sales Revenue Sales Deductions Product Costing CO-PC Standard Cost of Products Valuation CO-PA Estimate Sales and Administration Overhead Costs
Profitability Analysis
CO-PA
Example : SD Interface
SD Interface : Concerns
Pre-requisites :
field status group : profitability segment required cost element category = 11/12
Efforts :
Derivation Rules
Customer Hierarchies
Valuation
Costing Based Transferred to Value Fields . Fictitious costs are permitted Capture Product Costing Info Short term up-to-date information . Less Resource Intensive
Account Based Transferred to cost and revenue Accounts Reconciled with FI No Product Costing Info. Same as in FI (data transferred when posted in Financial Accounting) More Resource Intensive
PLANNING
39
Planning
Parallel versions (multiple plan versions) Flexible design of individual planning layouts Planning of profitability segments : Bottom-up strategy Copy, change and re-organise (delete) plans Perform top-down distribution Transfer of planned overhead costs to CO-PA Transfer of planned PA to SOP
Planning Integration
Bottom Up Planning
Char. Value
Plywood *
Distr. Level
REPORTING
43
Word Email
Types of Report
Actual Report Plan/Actual Reports
Act/Bud/LY By Period Brand Results MTD (Act/Bud/LY)
Budget Report
Product/Country Reports
Brand Results by Country Brand Results by Product
Reporting Dimensions
ASSUMPTIONS
49
Assumptions
Reporting Dimensions (Characteristics) will be based on fields already defined in the system Re-conversion of existing material masters, if required, is specifically excluded
Summary
Goals of CO-PA
up-to-the-minute analysis of profitability up-to-the-minute analysis of sales management analysis of any segments of the business (products,customers, sales districts and any combination of these and other characteristics) analysis of organisational units (such as sales organisations or business areas) basis for decisions in pricing, customer selection, policies on terms, quantity control, choice of distribution channel, and marketing
Summary (Contd)
Costing-based CO-PA and account-based CO-PA. Costing-based CO-PA allows the presentation of results by comparison of posted revenues and sales deductions with imputed costs and sales deductions. Account-based CO-PA allows the presentation of results in accounts (by omitting the use of costing based values), which ensures the ability to reconcile with FI
Summary (Contd)
Areas of Concerned
Integration points require significant cross-functional team cooperation Early research minimizes problems later Table size and reporting performance must be managed
- Cost Center Overhead [Administration Cost, Salary, etc] - Direct FI Postings [Other Expenses, Miscellaneous]
User-Defined update which characteristics?