Cost Object Controlling

Support Below functionalities

1 Plan cost calculation for the Order
2 Actual cost calculation for the Order
3 Result Analysis (WIP calculation)
4 Variance Calculation
5 Settelemement of the Order
6 Integartion with PP

7 Integartion with MM

Cost Object Controlling

1 Product Cost By Order
Production Orders
Process Orders
CO Production Order

2 Product Cost By Period

PCC with Repetetive Mfg
PCC with Descretive Mfg

3 Product Cost By Sales Order

SO is not a cost Object With Valuated Stock
SO is a cost Object With Valuated Stock
SO is a cost Object With Non Valuated Stock
 Purpose
To generate Plan Cost For Order
To generate Actual Cost For Order
To Calculate WIP or Reserves
To Calculation Variance along with Variance cVariance Settings
To Post FI entry for WIP and Variance
Config Required
Costing Variant for Plan ( Costing Type 06
Costing Variant for Actual ( Costing Type 0
WIP Settings to be done
Settelement Profile , Allocation Structure
PP Order Type
Settelement Profile
RA Key
Costing Variant for plan
Costing Variant for Actual

Default Variance Key-------> Plant

====> To address the different Industry requirements

Used in Descrete Mfg industries ( Eng Industries )

Used in Process industries ( Pharma , Chemical Industries )
Used in Descrete Mfg industries ( Eng Industries )

FMCG -Soaps
Automobile , Computer processors

Enginerring industries
ated Stock

uated Stock
 n ( Costing Type 06 , Valuation Variant)
tual ( Costing Type 07 , Valuation Variant)

Allocation Structure, PA Transfer Structure , Source structure

t for plan
t for Actual

-----> Plant
Production Order
Costing Variant for Plan
Estimated plan cost for the production order to complete production

Configuraton:
Y1 Costing variant for Plan
Costing type
Valuation variant
 Save

Save

Y2 Costing Variant For actual

 Purpose :
Generating Actual cost for Production Order

Save
mplete production

'06
Y0
Production Order status
WIP calculate only for incomplet
Incomplete Orders can be recogn
Production Orde
Created REL

Created
Not ready use for Pro

Release(REL)
Just started producti
Might be consumed
No Output of Produc
WIP = Actual cost De
Partial Delevery(PDEL)
Few qty completed a
Example : Production
Completed less than
Debited Cost and cr
WIP = Actual cost d

Del(Delevered)
Total Qty completed
Example : Production
Completed 10PC
Not relevant for WIP
WIP get cancelled (r
 Variance calculates f

Teco( Technically completed)

No futher work pend
No furher productin

Variance calculates f
WIP get cancelled (r

WIP Methods
1 Actual Cost method

2 Target cost Method(

1 Actual Cost method

Producton order, Co
WIP Calculates based on Order status.
WIP calculates only for those order either having status R
WIP cancel (Reverse) for those Order either having statu
WIP = Total Actual cost Debited on the order- Total Actual cost
= Order Balance

During wip calculation , Sytem calculates WIP and save in

WIP entry Generates at the time of Order settelement

Dr. WIP-BS
Cr.WIP- P&L WIP config GL accounts
WIP = Total Actual cost Debited on the order- Total Actual cost
 15229.24 - 12441.36
2787.88

WIP Break up based on wip configuration setti

WIP-Mat 589.98
WIP-DOH 2197.9
Total WIP 2787.88
y for incompleted orders
rs can be recognised through Order Status
Production Order Status
PDEL DEL TECO Closed

eady use for Production

tarted production and in process

t be consumed Few material , Activities and OH
utput of Production
= Actual cost Debited on Order Here no Cost credited due to no output of

qty completed and still few more qty in process

ple : Production plan qty==>10PC 10kg
pleted less than 10PC then it is partial delevery
ted Cost and credit COGM(Output of Production)
= Actual cost debited on Order-Actual cost (COGM) credited on Order

Qty completed
ple : Production plan qty==>10PC
pleted 10PC
relevant for WIP as total production Qty Completed
get cancelled (reversed) if any calculated earlier
ance calculates for Completed Orders if order status is Delevered

completed)
ther work pending ====> Completed total qty o
urher producting poduction for specific order ====> Technically saying no f
===> Plan qty 10kgs===> Com
ance calculates for Completed Orders if order status either Delevered or Techo statu
get cancelled (reversed) if any calculated earlier if order status having Delevered or T

al Cost method
Producton order, Co orders, Process Order
et cost Method( Plan cost)
PCC( Product cost collector)

ucton order, Co orders, Process Order

r having status REL or PDEL status

her having status DEL or Teco status
otal Actual cost credied on the Order

WIP and save in the RA ( Result analysis ) Versions and it wouldn't generate any FI en

settelement
Example INR
2788
L accounts 2788
otal Actual cost credied on the Order
nfiguration settings
e to no output of Production

9.999kg
pleted total qty of Production ( Completed 10pc out of 10PC)
nically saying no further qty ( Remaing qty) not producing
ty 10kgs===> Completed 9.999KG ===> in this case balance .001 qty not producing b
d or Techo status
ng Delevered or Techo

enerate any FI entry during wIP calculation

y not producing by specifying status to Teco
 Why WIP(Work in Progress ) required ?

25.01.2023===> GI to the Prd order

Dr. Mat Consumtion

Cr. Stock-RMX

26.01.2023
Dr. Labour Recovery GL
Cr. Labour Recovery GL

P&L Statemnt
Exp
Mat Consumtion
Salaries
Rent
off of WIP cap
Total
 BS

WIP Methods in SAP

Two Types of WIP Methods to calculate WIP at Mfg Order level ( Prod
1 WIP with Actual Cost method
2 WIP with Target Cost Method

WIP with Actual Cost method

WIP = Total actual cost debited on order - Total actual cost c
Note : In release status , order having only debits and No credits
In PDEL(Partial Delevery) status , Order having both debits and
In Techo status( Technically completed work) , Order having bo
WIP = Total actual cost debited - Total actual cost credited ( O

in Actual Cost Method , during WIP calculation ,WIP calculates based

WIP calculates either Order status having REL or PDEL and WIP Get ca
WIP entry generates at the time of Order settelement
FI entry for WIP

FI entry for WIP Reversal if production is completed

WIP Setings
Production Order Status
1 Create Status
 Not possible to progess the production
1
2

2 Release Status
We need to release the order to use for production
manually to be released
1

Gi to the production order

CO11N Confirmation of activities

Actual acty qty X activity price as per valuation variant strateg

Only Co entry generates

WIP calculates for those orders having status either Rel Or PDEL
Calculated wip saves in RA versions
No fI engerates during WIP calculation
FI entry post for WIP during settelement of Order

WIP canceles for those orders having status either DEL Or TECO
Calculated(cancel or reduced wip) wip saves in RA versions
No fI engerates during WIP calculation
FI entry will post for WIP reversal during settelement of Orde

WIP Calculation methods for Mfg Orders

1

1 Actual cost method

WIP = Total actual cost debited - Total actual cost credited ( O

Note : In release status , order having only debits and No credits
In PDEL status , Order having both debits and credits
In Techo status , Order having both Debits and Credits
WIP = Total actual cost debited - Total actual cost credited ( O

KKAX Calculating WIP for Individual Orders

KKAO Calculating WIP for Collective Orders
KKAX
WIP Break UP
931000
931001
931002

WIP Configuation Settings

Line ID

Purpose of Line ID's

Which factors to be consider while finalising Line ID

1
2
3
Line ID
Y10
Y20
Y30
Y40
Y50

Assignment
Mapping(assignement) of Source CE to the Line ID ( Which Co
 By using Masking method , We can group CE to the Line ID

Update
1 Which cost (Which Line ID)to be include or exclude from WIP

Line ID category===>

2 Calculated WIP or reserves to be updated under which RA CE

Line ID
Y10 (mat)

Y20(DOH)

Y30(IOH)

Y40(PM & Misc exp)

Y50(Credit =COGM)
WIP====> where debited actual cost is more than credits
WIP

Reserves ====> where debited actual cost is less than credits

Reserves

Order1-FGX-5PCX Std Price 3000

In the above case for Order1 WIP =10000

WIP =

At orderFI entry for WIP

Example2 for Reserves

Order2-FGX-5PCX Std Price 3000
Reserves =
FI entry for Reserves
At the time of Order settelement

Posting Rules
1 Which type of RA results to be posted to the FI
During WIP calculation , Different type of results calculated
Example :
WIP category
WIPR ( WIP to be capitalised)
RUCR ( Reserves to be capitalised)
COSR ( Cost of sales to be capitalised)

By using WIP category , We can specify which type of results t

2 Results to be posted to which P&L and BS accounts ( Account

P&L and BS====> Company code + RA catergory +RA CE

Co.code RA category
Y100 WIPR
Y100 WIPR
Y100 WIPR
Y100 RUCR
Settelement
It generates FI entry for WIP
Dr.WIP-BS
Cr. WIP-P&L

It generates FI entry for WIP reversal if order status having ei

Cr.WIP-BS
Dr. WIP-P&L

Note :
During WIP calculation , System calculates WIP for Those orders havin
NO FI entry generates during WIP calculation
FI entry generates for WIP / WIP reversal only at the time of Order se
Assume Production it takes 4 months to complete the production

Prd Ord1 -FGX

Mat expences 10000
Lab cost 2000
Total exp on order 12000 ====> still in production
Dr. WIP-BS
Cr.P&L-off of WIP

10000 Dr. Order1 10000

10000

2000 Dr. Order1 2000

2000 Cr Cc 2000

Income
10000 Sales 2000
15000
5000 Loss 16000
-12000
18000 Total 18000
 Stock-RM 50000-10000
WIP Cap 12000

at Mfg Order level ( Production Order)

======> Production Orders , Process Orders , CO Production Orders
=====> PCC ( Product Cost collectors with Repetive Mfg Process)

er - Total actual cost credited on order ( Out out of production) = Order Balance
s and No credits
aving both debits and credits
ork) , Order having both Debits and Credits
ctual cost credited ( Out out of production)

on ,WIP calculates based on Order status and results save in Result analysis version (RA versions
L or PDEL and WIP Get cancelled if Order status having either DEL or Techo status
ttelement
INR
Dr WIP-BS ( Current assets) 12000
Cr WIP-P&L (Without CE) 12000

Cr WIP-BS ( Current assets) 12000

Dr WIP-P&L (Without CE) 12000

Create , REL, PDEL, DEL , Techo , Clos

 Not possible issue Goods to the production
Not possible to book any activities and also cost

r production

Possible to book goods issue and also activities

No output of production
Order having only debits ( Expenses ==> mat exp , Acty cost(Conversion cost)
Production in process
Possible to calculate WIP

RMX
Dr. Mat consumtion
Cr. Stock
( Actual qty X Price)
Price as per price control in MM and
17kg X696.70 11843.9

Resource time booking and confirming which process step completed( Opera

aluation variant strategy

Dr. Prd Order

Cr. Cost center
Actual acty qty X activity price as per valuation variant strategy
her Rel Or PDEL

nt of Order
Dr. WIP-BS
Cr.WIP-P&L
er DEL Or TECO
saves in RA versions

g settelement of Order
Dr.WIP-P&L
Cr. WIP-BS

Actual cost method

WIP valuated with Actual cost
Actual cost method used in Production order
,Process orders and sales orders

ctual cost credited ( Out out of production)

s and No credits
and credits
s and Credits
ctual cost credited ( Out out of production)
32788.42 - 0
32788.42
 Calculating WIP for Individual Orders

WIP-Mat 30,954.34
WIP-DOH 1,834.08
WIP-IOH 0
Total WIP 32,788.42

Used to Group the cost ( Grouping of CE)

Lind ID are used in WIP calculations
By using Line ID , We can get WIP break up for Lind ID wise
By Using Line ID , We can specify which Line ID ( Which cost)can be include or
By using Line ID, We can post to different P&L and BS accounts as per Line ID

ising Line ID
WIP Break UP
Execlude or Include WIP
How the WIP to be posted to the Different FI WIP GL accounts
Description
Mat Cost
DOH
IOH
PM&misc(Not include)
Settelement(Credit)==>COGM Credit line ID require
Settelement (Credit)===> GR value from Order to Stock (Output of Productio

the Line ID ( Which Cost to be grouped under which specific Line ID)
up CE to the Line ID

e or exclude from WIP

Y40 PM&misc(Not include) to be exclude from WIP
Below line id to be include in WIP
Y10 Mat Cost ===> Line ID Category K
Y20 DOH ===> Line ID Category K
Y30 IOH ===> Line ID Category K

K Cost Includes WIP

N Cost Excludes from WIP
A Settelement Line ID( it represents credit line id)===>CO
E Revenue includes Result Analysis calculation
ed under which RA CE ( CE category 31)
Line ID category Des RA CE
K WIP 931000
Reserves 931000

K WIP 931001
Reserves 931001

K WIP 931002
Reserves 931002

A
n credits
= Total Actual cost Debited - Total Actual cost Credited i

than credits
= Total Actual cost Debited - Total Actual cost Credited i

Mat Consumtion cost 4000

Activity Cost 7000
IOH 5000
Actual GR 2PC X3000 -6000 Credited ( Out put of
Order Balance 10000

16000 - 6000 =10000 Total debit value 1600

Dr WIP-BS ( Current assets) 10000

Cr WIP-P&L 10000

Mat Consumtion cost 3000

Activity Cost 5000
IOH 1500
Actual GR 4PC X3000 -12000 Output of production
 Order Balance -2500 ====> Negative bala

9500 - 12000 =-2500 Total debit value 9500

Dr WIP-P&L 2500
Cr WIP-BS ( Current Liabilties) 2500

o the FI
of results calculated

WIP ==> Debits is more than Credits

Reserves ===> Credits is more than debits
COS
Calculated Revenue Sales Order Costing

which type of results to be transferred to the FI

BS accounts ( Account determination===> to which accounts to be posted

catergory +RA CE
RA CE P&L BS
931000(Mat) 10891 31891 WIP BS Mat
9310019DOH) 11892 31892 WIP BS DOH
931002(IOH) 11893 31893 WIP BS IOH
10890 41891 WIP bS Reserves
order status having either dEL or Techo

IP for Those orders having status either REL or PDEL and calculated results it saves in the RA ve

y at the time of Order setelement

===> still in production in process=====> prov entry for production in process
. WIP-BS 12000
P&L-off of WIP 12000

this is not fully loss====> few expenditure spent on production but still produc
Order Balance

= Order balance

s version (RA versions) along with RA (CE31) Cost elements

o status

L, DEL , Techo , Closed status

ost(Conversion cost) and IOH)

Dr. Prd order

control in MM and it ignores valuation strategy for GI ( Goods Movement)

p completed( Operation)
 2 Target cost method( Plan cost)
WIP valuated with plan cost
tion order Target cost method used in PCC
nd sales orders

= Order balance
st)can be include or execlude from WIP calculation ( example : PM cost need to be e
ounts as per Line ID

redit line ID required in WIP Actual cost Method

Output of Production)
 ( We can control by using Lind ID Category)
e from WIP =====> Line ID cateory N ( cost exclude from WIP)

redit line id)===>COGM line item

alculation
tual cost Credited if Total actual cost debits is more than credits

tual cost Credited if Total actual cost credits is more than debits

redited ( Out put of Production)

tal debit value 16000 is more than Credit value 6000 hece it treated as WIP

utput of production( GR 4PC from Production order to Stock)

===> Negative balance===> reserves

tal debit value 9500 is less than Credit value 12000 hece it treated as Reserves

e posted

IP BS Mat
IP BS DOH
IP BS IOH
IP bS Reserves
s it saves in the RA versions and updates under RACE( 31CE)
ction but still production not yet completed
vement)
M cost need to be exclude from WIP capitaistion )
de from WIP)
ed as WIP
as Reserves
WIP with Actual cost method

Define Results Analysis Keys

Define Cost Elements for WIP Calculation

RA CE===>CE category31
Purpose:

Requirement :-

Define Results Analysis Versions

 Save
Define Results Analysis Versions
Orders in Sales Order related production :
Mfg Orders without settelement to Material
Internal order and Service orders without Revenue :

Cutoff Perd

Jan
Cost 15000

If Cut off prd not specified

If Cut off period specified

 Technical RA CE====> It is used in internal calculation of th

Define Valuation Method (Actual Costs)

Define Line IDs
Line ID

Which factors to be consider while finalising Line ID

1
2
3
Co.Area Line ID
Y000 Y1
Y000 Y2
Y000 Y3
Y000 Y4
Y000 Y5
 Save
Define Assignment

Define Assignment
Material cost related CE start from 10000 to 10999

Now Masking like==>0000010+++=====> That means it gr

Orign Group=====> Method of grouping the Material cost

Accounting Indicator====> it used in CS( Customer service Module) to

 Co.Area
Y000
Y000
Y000
Y000
Y000

Save
Define Update

1 Which cost (Which Line ID)to be include or exclude from W

 Line ID category===>

WIP===> Where the debits is more than credit

Reserves===> Where the dibits is less than credit ( Credit i
2 Calculated WIP or reserves to be updated under which RA
Line ID
Y1 (mat)

Y2(DOH)

Y3(IOH)

Y4(PM & Misc exp)

Y5(Credit =COGM)
Save

Posting Rules
 1 Which type of RA results to be posted to the FI
During WIP calculation , Different type of results calculated
Example :
WIP category
WIPR ( WIP to be capitalised)
Product costing=>
RUCR ( Reserves to be capitalised)
COSR ( Cost of sales to be capitalise

By using WIP category , We can specify which type of resul

2 Results to be posted to which P&L and BS accounts ( Accou

P&L and BS GL accounts mapped to the combination of ==

Co.AreCo.code RA category
Y000 Y100 WIPR
Y000 Y100 WIPR
Y000 Y100 WIPR
Y000 Y100 RUCR
 Save
Define Number Ranges
Already done through the transaction code ==> KANK

Ativate RA version to transfer to the FI

Save
 FYI

FS00 31892

Save
FS00 WIP-P&L accounts without CE
Off wIP IOH
OFF Reserves 10890

Save
RA key grouping the configuration parameters that specifies how the WIP to
RA CE used in result analysis calculation
Calculated WIP results updates under the RA CE
By using RA CE, We can structure break up of WIP( Cost sheet for WIP)
By using RA CE, We can post to different P&L and BS acounts
Example : Need to post WIP mat

WIP Break up

Material cost
DOH
IOH
Technical RA CE
Technical RA CE===> it uses in internal calculation ( Program)of result analysi

RACE to be created without Com

SO Costing:-Different scenarios
SO is not a cost object with valua
SO is a cost object with valuated
SO is a cost object with non valu
MTO Scenario
SO (SO is a additional cost object in
==> Sales exp( Freght / insurance
Prod order

Option1:
Result analysis can be calculated
Option2:
Result Analysis can be calculated

Mfg orders====> Prod orders/ Process orders/ PCC/ CO Production orders

If Indicator is Activated :

If Indicator is not Activated :

ut Revenue :

Purpose : To calculate WIP for IO level and Service Ord

If Indicator is Activated :

If Indicator is not Activated :

===> Till which Period WIP already calculted / Perform

Prd Order1
Feb March Apr
5000 2000 1000

WIP Program it checks the data from beinning of the FY

 Jan Feb March
Completed Completed Completed
In Cut off perd===> Perd3(March).2023
That means WIP already calculate
when you perform WIP for period 4.2023 ,system it con

WIP
Cumulative
23000

sed in internal calculation of the RA Program

Which valuation method to be used to valuate WIP

Valuation method establish link between RA version, RA Key , Method and St
It specifies , WIP to be calculated on which status ( REL/PDEL) and WIP to be c
WIP having two Methods
1
2
1 Actual cost Method

WIP Calculation methods for Mfg Orders

1 Actual cost method

1 Actual cost method

 WIP = Total actual cost debited - Total actual cost credi
Note : In release status , order having only debits and No credits
In PDEL status , Order having both debits and credits
In Techo status , Order having both Debits and Credits
WIP = Total actual cost debited - Total actual cost credi
32788.42 - 0
32788.42
KKAX Calculating WIP for Individual Orders
KKAO Calculating WIP for Collective Orders
 Used to Group the cost ( Grouping of CE)
Lind ID are used in WIP calculations
By using Line ID , We can get WIP break up for Lind ID wise
By Using Line ID , We can specify which Line ID ( Which cost)can be include or
By using Line ID, We can post to different P&L and BS accounts as per Line ID

r while finalising Line ID

WIP Break UP
Execlude or Include WIP
How the WIP to be posted to the FI
Description
Mat Cost
DOH
IOH
PM&misc(Not include)
Settelement(Credit)
 Mapping of the source CE to the Lind ID

Source CE====> Whatever CE is u

By Using the masking method , We can group the CE to the Line ID

Masking is method of grouping C

0 to 10999

10+++=====> That means it group ce from 10000 to 10999

g the Material cost

( Customer service Module) to clasify the type of the service

We can also use to group the co
 Line ID Description Range of CE
Y1 Mat Cost 10000 to 10999
Y2 DOH 94300 to 94399
Y3 IOH 94100 to 94199
Y4 PM&misc(Not include10003 to 10003
Y5 Settelement(Credit) 10080 to 81

o be include or exclude from WIP

 Y4 PM&misc(Not include) to be exclude from WIP
Below line id to be include in WIP
Y1 Mat Cost
Y2 DOH
Y3 IOH

K Cost Includes WIP

N Cost Excludes from WIP
A Settelement Line ID( it represents credit line id)
E Revenue includes Result Analysis calculation
s more than credit
bits is less than credit ( Credit is more tha debit)
o be updated under which RA CE ( CE category 31)
Line ID category Des RA CE
K WIP 93100
Reserves 93100

K WIP 93101
Reserves 93101

K WIP 93102
Reserves 93102

A
be posted to the FI
erent type of results calculated

WIP ==> Debits is more than Credits

Reserves ===> Credits is more than debits
COS
Calculated Revenue

can specify which type of results to be transferred to the FI

ch P&L and BS accounts ( Account determination===> to which accounts to be posted

pped to the combination of ====> Company code + RA catergory +RA CE

RA CE P&L W/O CE BS
93100 10891 31892
93101 11892 31893
93102 11893 31894
11890 41891

Note : Without CE( wip P&L GL accounts)

ansaction code ==> KANK
BS WIP Mat
cifies how the WIP to be calculated ,Which method to be followed, When to calculte
 sheet for WIP)

Need to post WIP mat and WIP-Oh to different P&L and BS GL account

RA CE CE Category No Company code

93100 31
93101 31
93102 31
93103 31 ====> System technical r
gram)of result analysis purpose

created without Company code segment

 Relevant only for SO is a cost ob

PC BY SO
cost object with valuated stock
t object with valuated stock
t object with non valuated stock

ditional cost object in addition to Mfg Orders)

xp( Freght / insurance , special packing , sales comission etc) , other cost, Revenue

Mfg cost ( Mat cost +acty cost +IOH)

If Indicator is activated
ysis can be calculated separately for production order and separately for SO
Need to perform result analysis separately At Produc
 Need to perform result analysis separately At Sales o

If Indicator is not activated

ysis can be calculated directly at the SO level
In this case, values of the dependent objects ( Prod o
Not requred to perform result analysis separa
Need to perform result analysis direcly At Sale

Production orders

Production order =====> Always setteled to the material

In few Cases===> Production order not relevan

Example : Reproce

Possible to perform result analysis for those pr

Not Possible to perform result analysis for tho

In this case , First settele the dependent order
We will perform result analysis directly at the
level and Service Order level
normally we wouldn't performing result analysis for Internal orde (IO) andS

IO
Cost======> setteled at the month end either to the
PSG( Profitability segment
At the month end , Cost its becomes Zero after settele

Possible to perform result analysis for IO and s

Not Possible to perform result analysis for IO a

dy calculted / Performed

rom beinning of the FY=====> It impacts performance while executing WIP Program
 Apr

WIP already calculated Till period 3.2023

d 4.2023 ,system it consders only for April perd order changes , It wouldn't look for p

Current Perd(4.2023)
1000

A Key , Method and Status

PDEL) and WIP to be canceled on which status (DEL/Teco)

Actual cost Method

Target Cost Method
Method
It is used in the Production Orders, Process orders

method 2
WIP valuated with Actual cost
Actual cost method used in Production order
,Process orders and sales orders
 Total actual cost credited ( Out out of production)
No credits

Total actual cost credited ( Out out of production)

cost)can be include or execlude from WIP calculation
ccounts as per Line ID

To get WIP Break Up

To exclude from WIP
Required in Actual cost method
===> Whatever CE is used to book the cost on the Order
Example :
Material consumtion CE (1)
Activity Cost elements(43)
IOH CE (41)

the Line ID
method of grouping CE

so use to group the cost accounting indicator wise

Order
Masked CE Dr/Cr F/V Org GrCC
0000010+++ + + +++++
00000943++ + + ++++++++++
00000941++ + + ++++++++++
0000010003 + +
0000010080 + +
0000010081 + +

( We can control by using

ude from WIP

s credit line id)

calculation
accounts to be posted

ry +RA CE
d, When to calculte and cancel the WIP
 No Company code Segment

> System technical requirement

y for SO is a cost object with Non valuated Stock

PC BY SO

her cost, Revenue 2000(Cost)

10000(Cost)

tely for SO
eparately At Production order level ===> WIP at prod order level==>100
eparately At Sales order level ===> WIP at SO level==>2000INR(W

ent objects ( Prod order values) which considers directly in the result analysis of the
esult analysis separately At Production order level
alysis direcly At Sales order level WIP = 2000+10000=12000INR

on order not relevant for setteled to the material

Example : Reprocess orders ( Defective in process)===> in such case we will create n
in such case, cost setteled directly to the parent production order instead of

analysis for those producion orders created without settelement to Material

sult analysis for those producion orders created without settelement to Material
he dependent orders (Reprocess orders)=====> Main order (Parent order)
alysis directly at the Main production order level ( Parent order level)
ernal orde (IO) andService order Level

h end either to the FI or other cos objects ( CC/WBS/SO/PSG)

Profitability segment)===> COPA
es Zero after settelement hence not required to perform result analysis

analysis for IO and service orders

sult analysis for IO and service orders

uting WIP Program

wouldn't look for previous period====> It improves the program performance

Target cost method( Plan cost)

WIP valuated with plan cost
Target cost method used in PCC
= Order balance
===> It represents the COGM
 Acty type
GBB-VBR , GBB-VBO, FRL
'+++++ Activity CE===> those activity types used in Routing ( CE43 cate
Costing sheet ( CE41) , Template allocation ( Activity CE(43)===
Relevant CE need to be mapped ( Primary PM consumtion CE ,
GBB-AUF==> COGM CE

can control by using Lind ID Category)

order level==>10000INR(WIP)
vel==>2000INR(WIP)

lt analysis of the sales order hence not required to perform result analysis separately

se we will create new production order to correct reprocess defectives

order instead of the material

Material

nt to Material
erformance
outing ( CE43 category CE) , Template allocation ( Acty CE43 which is part of direct OH
ctivity CE(43)===> Those activities used in the template allocation
consumtion CE , Activity CE)
nalysis separately at the production order level
part of direct OH allocation)
Variance Calculation
Variance is comparision between two types of the cost
STD Cost ====> Material cost estima
Plan Cost ====> Estimate plan cost o
Actual cost =====> Actual cost of the o
Possible to calculate different type of the varian

Total Variance

Production variance

Plan variance

In Prd order / Process Orders===> Variance calculates based on

in case of ECC , Variance split updat

In case of S/4 , Variance split updat
Variance calculates for each Target Cost version

Target cost version specifies how the variance to

Target cost version specfies what is
Variance Target Cost version

Total Variance 0

Note : Control cost = Net of

Total variance possible to ca

Total variance only relevant

Production Variance 1

Note : Control cost = Net of

Production variance not rele

Plan Variance 2

Note : Control cost = Plan co

Plan variance not relevant fo

During variance calculation , Variance calculates

Types of the Variance Categ

Input Side Variance
1 Input Price Variance
2 Input Qty Variance
3 Resource Usase Variance
 4 Remaining Input Variance
5 Scrap Variance

Input Price variance

Price of input materials , Acti
Price of input mat , Activitie

Total Varance
 Input Price var

Input Qty Variance

Qty of Input materials , Activ

Total var = Input price var +Input Qty var =90+70

Resource Usase Variance

It calculates below cases
Case1 1

FGX-->1000INR
Note : If material orgin indicator no

Case2

FGX-->1000INR

Resource Usase Var

 In the above example : RMY

Remaing Input Variance

1 Difference between STD OH Amount and A
2 If any Input side variance category not ac
3 OH rate % differ between STD cost and Ac
Example:
MOH @10% on Mat cost in Std cos
Actual MOH @12% on mat cost in a

Case1 MOH rate 10% both Std and actual

FGX-->1000INR
RMX
LAB

MOH
 Remining Input Var = Atual OH amount -St

Always remaining input var calculates eventhoug

Case2 If Any Category not selected in input side, then t

Example Input Price var===>340

If indicator input price var no

Scrap Variance :
Scrap it represents the defectives
Scrap var category not acivated then the r
Scrap var is the scrap % difference betwee

Types of scrap
Components scrap
Assesmble Scrap
Operational scrap
Output Side Variane
Mixed Price Variance
Mixed Cost estimate====> Weighted Avg Cost es

Without Mixed Cost estimate=====

FGX-->1PC

Run cost estimate , possible

With Mixed Cost estimate=====> P

FGX-->1PC

Run cost estimate , possible

Mixed Cost estimate =

 Mixed Cost estimate =

Mixced Price variance

If indicator not seleted then relevant vari
Mixed price variance always calculates if p
Mixed Price var = Mixed cost estimate - St

Mixed Cost estimate====> Weighted average co

Assume Producing product 60% by

Mixed Cost estimate =

Lot Size Variance

It is relevant if any Lot size differs
If any fixed nature of component(B

Fixed Nature : ?

Example :
 Fixed Nature

Consumables( BOM level-Fixed)

Cleaning ( WC formula-Fixed)

Output Price Variance

It genearates if any STD cost estimate changed a

FGX
Std Cost 10000
 New STD cost estimate realeased on 10.02.2023

If you perform variance calculation on 28.02.20

In this case Out Put price var ===> New ST

Remaining Variance
if any category not selected in output side ( Lot s
No STD cost estimate available ( Manual STD Pri
NO GR qty but done techo
 ypes of the cost
==> Material cost estimate( Std Cost estimate of the product)
==> Estimate plan cost of the Order
===> Actual cost of the orders
fferent type of the variance by comparing between different types of the cost

= Comparision between STD and Actual cost

= Comparision between Plan cost and Actual cost

= Comparision between Plan cost and Std cost

ance calculates based on Order status

Vriance calculates only if order status having either DEL or TECHO status
Variance calculates only for those orders hving status either DEL or Techo sta
Calculated variance save in the Target versions
During variance calculation, System calculates variance and save in the versio
FI entry for Variance generates only at the time of Order settelement
Total var updates to the FI and variance category wise ( Clasification of varian
ECC , Variance split updates only to Costing based copa
S/4 , Variance split updates to all relevant components i.e---> FI , ACB COPA & Costing
t version

ifies how the variance to be calculated and which type of the cost to be compared
t version specfies what is control cost and Target cost
 = Control cost - Taget cost

= Control cost - Taget cost

Actual cost - STD cost
e : Control cost = Net of Actual cost = Total Actual cost-WIP-Scrap
Target cost = Actual GR qty X STD price
al variance possible to calculate only for "0" version
al variance only relevant for settelement to FI and COPA

= Control cost - Taget cost

Actual cost - Plan cost
e : Control cost = Net of Actual cost = Total Actual cost-WIP-Scrap
Target cost = Plan GR qty X Plan cost
duction variance not relevant for settelement and used only for analysis purpose

= Control cost - Taget cost

Plan cost - Std cost
e : Control cost = Plan cost
Target cost = Plan GR qty X STD cost
n variance not relevant for settelement and used only for analysis purpose

tion , Variance calculates and it gives the break up of the variance ( Variance clasificati

pes of the Variance Categories

Variance
Variance

e of input materials , Activities differ at the time of STD cost and at the time of GI of t
ce of input mat , Activities differ between STD cost and actual cost
Std Cost
FGX-->1000INR Qty Price
RMX 1kg 600
LAB 1hr 400
Total

al Varance = Actual cost-STD cost

=1790-1000
ut Price var = Price of input mat , acty differ betw

RMX ( Actual rate - Std Rate ) X Actual inp

(620-600)*1.5

Lab (430-400)*2
Input Price variance

of Input materials , Activities qty differ between STD cost and Actual Cost

( Actual input qty -STD Input qty) X S

RMX (1.5kg-1kg)X600

Lab (2hr-1hr)X400

Input qty Var

ar +Input Qty var =90+700 =790

alculates below cases

If Material orgin indicator not actiated in the MM of the input materials then
Std cost
-->1000INR Qty Price Amt
RMX 1kg 600 600
LAB 1hr 400 400
 Total 1000

aterial orgin indicator not activated in the MM RMX costing 1 tab

Entire variance RMX reported under Resource Usase Var
RMX
Input Price var
Input Qty var
Resource usase Var

Lab
Input Price var
Input Qty var
Resource usase Var

Total Var

Usage of the different input material and activities other than specified in std
In such case , the sustitutional component and acty cost will report under res
Using one material(RMY) instead of other of material (RMX)
in this case , both RMX and RMY report under Resou
Std cost
-->1000INR Qty Price Amt
RMX 1kg 600 600
LAB 1hr 400 400

Total 1000

Usase Var
 1 Component and acty not at all used
2 Used different component and acty i
he above example : RMY is not part of std cost and also rMX not at all used
Hence both RMX and rMY reports un

Resource Usase Var

RMX
RMY
Resource Usase Var

Mechn
Resource Usase Var

Total Resource Usase var

en STD OH Amount and Atual OH Amount if costing sheet method used eventhough
variance category not activated in the config settings then the relevant category of va
between STD cost and Actual Cost

% on Mat cost in Std cost

H @12% on mat cost in actual cost
Remaing Inut var
and actual
Qty Price Amt
1kg 600 600
1hr 400 400

10% On Mat cost 60 MOH

 Total 1000

ar = Atual OH amount -StD OH Amount

=93-60
33
var calculates eventhough OH rate is same due to input price variance , input qty var

ected in input side, then the relevant var updates under remaing input var

nput Price var===>340

dicator input price var not selected then it reports under reaming input var ===>340

ts the defectives
y not acivated then the relevant variance repots under input qty variance
crap % difference between Stdscrap % and Actual scrap %

Std Scrap % 5% ====> MM

Actual Scrap % 6% ====> Front end during Activity con
Scrap Var 1%

mponents scrap =====> Input components wasteage

esmble Scrap ====> Final component ( FG) wasta
erational scrap ====> in process wastage ( Defetive
 => Weighted Avg Cost estimate

Mixed Cost estimate=====> Possible to run cost estimating by using single alternative

Alternative1 10000 INR

BOM1
Routing1
cost estimate , possible to consider either Alternative1 or 2 so both not possible

d Cost estimate=====> Possible to run cost estimating by considering multiple altern

Alternative1 10000 INR

BOM1
Routing1

cost estimate , possible to consider all possibl Alternatives ( both Alternative1 and a
in this case we will give weitage to each alternative

(Alternative1 cost X Weightage + Alternative 2 cost

-------------------------------------------------------------------
Total Weitage
Planning for producing 60:40 Ratio
 (10000 inr X60 +13000X40)/(60+40)
11200

eleted then relevant variance updates under output price var

nce always calculates if product having mixed cost estimate
Mixed cost estimate - Std cost of specific product BOM and routing used

=> Weighted average cost estimate by considering all possible procurement alternati

FGX 1pc
Alternative 1==>BOM1,Routing1
Alternative2===>BOM2, Routing2

oducing product 60% by using alternative bom1 and routing1 and 40% by using alter
( Alternative 1cost estimate Xweighatage given + A
(10000X60+13000X40)/100
(10000*60+13000*40)/100
11200

ant if any Lot size differs between STD cost and Actual cost of production
d nature of component(BOM level specified as a fixed nature) and activities specified

d Nature : ?
Input qty it wouldn't vary based on lot size of production and always fixed qt

Lot Size
 FGX 1pc
RMX Var natur 1kg
Consumables( BOM level-Fixed) 1kg
Cleaning ( WC formula-Fixed) 1hr
Labour ( WC Formula-Var) 1hr

STd cost

Actual for 2pc of prd

ables( BOM level-Fixed) 50

( WC formula-Fixed) 200 (1Hr X1PC)

cost estimate changed after GR from prd ord to stock before variance calculation

Production order for fGX=

Mat consumtion
Lab cost
GR to Stock done on 05.0
Total Var
realeased on 10.02.2023==>12000

calculation on 28.02.2023 ( after releasing cost estimate) then system calculates Ou

ut price var ===> New STD price-Old Std price =12000-10000=2000

cted in output side ( Lot size var , Output price var)

vailable ( Manual STD Price)

Prd Order===>FGX==>1PC
RMX consumed
Lab consumed
NO GR done=====> GR t
Now Done Prd order as T
Total cost
 of the cost

t and Actual cost

t and Std cost

r TECHO status
er DEL or Techo status.

d save in the versions and it Wouldn't generate any FI entry

ettelement
asification of variance) updates only to the COPA

ACB COPA & Costing based copa

to be compared
nalysis purpose

Plan GR qty X Plan Cost

purpose

( Variance clasifications)

Out Put Side Variance

1 Lot Size Variance
2 Output Price variance
3 Mixed Price variance
 4 Remaing Variance

Alt 1
Alt2

t the time of GI of the input material and activitie consumtion ( with actual rate)

ost Actu
Amt Actual Production (Orde
600 1.5kg
400 2hr
1000

790
mat , acty differ between STD cost and actual cost

d Rate ) X Actual input qty

30

60
90

tual Cost

-STD Input qty) X Std price

300

400

700

nput materials then system wouldn't calculate Input price var , input qty var then enti
Actual cost
Actual Production (Order1-fgX)
1.5kg 620 930
2hr 430 860
 1790

0
0
330

60
400
0

790

than specified in std cost ( Which is not part of STD cost)

will report under resource usase var

report under Resource Usase variance

Actual cost
Actual Production (Order1-fgX)
RMY 1.5kg 620 930
Lab 2hr 430 860
Mechn 1hr 100 100
1890
cty not at all used
mponent and acty instead of other ( Which is not part of Std Cost)
t all used
and rMY reports under Resource Usase Var

600 ( Positive var) Not at all used compn

-930 ( Negative var) Used different compon
-330

-100 ( Negative var) Used different activity

-100

-430

d used eventhough there is no change between STD OH rate and actual OH rate
evant category of var updates under remaing input variance

600@10% 60
930@12% 111.6
ng Inut var 51.6

Actual Production (Order1-fgX)

RMY 1.5kg 620 930
Lab 2hr 430 860
Mechn1hr 100 100
10% 93
 1890

ance , input qty variance and resource usase variance

nput var

input var ===>340

variance

during Activity confirmations ( Yield confirmation)

mponents wasteage ( defective) can be called as Component scrap

ponent ( FG) wastage ( Defetive) can be called as Assemble scrap
wastage ( Defetive) can be called as Opertional scrap
g single alternative BOM , Routing (BOM1, Routing1)

Alternative2 13000 INR

BOM2
Routing2
oth not possible

ring multiple alternative BOM , Routing (BOM1, Routing1/ BOM2 , Routing2, Externa

Alternative2 13000 INR

BOM2
Routing2

Alternative1 and alternative2 BOM , Routings)

o each alternative to be consider in the cost estimate

+ Alternative 2 cost X weghatage)

--------------------------
ng used

ocurement alternatives of the products along with weightage gven to each procreme

(internal Prg cal)STD cost

OM1,Routing1 10000
BOM2, Routing2 13000

40% by using alternative2 bOM2 , Routing2

eighatage given + Alternative2 cost esimate X weighatage given foe alterntive2)/ Tot

duction
activities specified ( It specified through work center formula)

and always fixed qty required

Prod Order ==>2PC (Lot

 Price Std cost
100 100 2
50 50 1
200 200 1
500 500 2

850 Actual cost

STD cost for 2pc
Var ==>one of the reason is Lot size var

for 2pc of prd STD for 2pc of prd

100

(1Hr X1PC) 400 (1hrX2PC)

Total lot size variance

ance calculation

ction order for fGX==>1PC

Mat consumtion 6000

Lab cost 4500
Stock done on 05.02.2023 -10000
Total Var 500 due input price var , qty var , any oth
 stem calculates Output price var

X==>1PC
onsumed 500
nsumed 600
R done=====> GR to the stock from production
Done Prd order as Techo
1100 ====> Report under Remaining Vr
= Actual cost - STD cost

=Actual cost - Plan cost

=Plan cost-Std cost

 Prd PlaStd Cost Mixed Cost
BOM1 Routing1 60% 10000 (10000*60+12000*40)/100
BOM2 Routing2 40% 12000

with actual rate)

Actual cost
al Production (Order1-fgX)
620 930
430 860
1790
put qty var then entire diffrence will consder as resource usase variance
t at all used compnent
d different component

d different activity

actual OH rate
, Routing2, External Proc etc)
n to each procrement alternative

Mixed Cost estimate Mixed Price variance

-1200 If used alternative1 in production
11200 1800 If used alternative2 in production

oe alterntive2)/ Total weighatage

Order ==>2PC (Lot size)

 Price Actual cost
100 200
50 50
200 200
500 1000

1450 For 2PC

850X2P 1700
-250

Lot size variance

-50

-200

-250

ar , qty var , any other categories

 Mixed Std Cost Mixed Price Var
*40)/100 10800 800
-1200
1 in production
2 in production
Config settings for Variance calculation

Define Variance Key

Variance key contains the variace calcuation c
Variance Program calculates variance only fo
Every order should be variance key then syst
Scrap :
If Indicator Activated:
System calculates scrap value and ded

If Indicator Not Activated

System wouldn't calculate scrap varian

Write Line Items : Optional

It creates log like who is performed var
Activate indicator only if really you wa
It impacts data volume and system pe

Define Default Variance Keys for Plants

We need to assigne default var key to the Pla

 System assignes default variance key to the m
Material master var key by default assi
Possible to assigne directly to the orde

Save
Check Variance Variants

It specifies which category ( Clasifiction of variance) of vr

Minor Difference : Any individual category of variance is less than mino

Example===> Minor difference =1%

in the above case , Assume Input price variance got less than 1% then
Assume inut qty variance got 3% i.e mo
Save

Define Valuation Variant for WIP and Scrap (Target Costs)

1 This setting is relevant for WIP calculati

2 This setting also relevant which price t
this setting is optional in case of WIP w
As per SAP Std functionality , It takes h
We can specify our own strategy thoug
 Save

Define Target Cost Versions

Target Cost version also specifies which

Target Cost version specifies which typ
Variance calculated only for Target cos
Target cost version specifies what is co
Variance Target Cost version =

Total Variance 0 =

Note : Control cost = Net

Target cost = Act
Total variance possible to
Total variance only releva

Production Variance 1 =

Note : Control cost = Net

Target cost = Plan
Production variance not r

Plan Variance 2 =

Note : Control cost = Plan

Target cost = Plan
Plan variance not relevan
Total Variance 0 =

Note : Control cost = Net of Act

Target cost = Actual GR
Total variance possible to calcul
Total variance only relevant for
Save

Production Variance 1 =

Note : Control cost = Net

Target cost = Plan
Production variance not r

Prequest====> Version 1 and 2 should be available in OKEQ

 Save

Plan Variance
Plan Variance 2 =

Note : Control cost = Plan

Target cost = Plan
Plan variance not relevan
Define Primary Data for Input Price Variances
Optional Setting
 We can calculate with Specified Fixed % on P
Example : Specified %===>5%
Assume material consumed===>10000

In the above case system calcul

Pre request :
Need to activate Variance Indicator in t
Need to specify the % Against Cost elem

OKKP Check Controlling area settings

Define Primary Data for Input Price Variances

Save
Not required primary data for input price variance in real

Define Number Ranges for Variance Documents

Already done through KANK ( CO Numb
variace calcuation configuration parametersi.e how to calculate the variance
tes variance only for those orders having variance Key
iance key then system considers that order for variance calculation
crap value and deducts from total variance during the variance calculation and calcu

alculate scrap variance and it reports under input qty variance category

ho is performed variances, Who is changed variance and when it is performed and ch

only if really you want analyse at the log level otherwise don't activate indicator
ume and system performance

t var key to the Plant

ariance key to the mterials based on the default var key linked to the plant
key by default assigned to the order based on the MM variance key
directly to the order level during creation of production order

on of variance) of vriance to be calculated

nce is less than minor difference % then the relevant category of variance reports un

t less than 1% then input price variance it will show under remaining variance
iance got 3% i.e more than minor difference then it reports under relevant var categ
et Costs)

ant for WIP calculation with Target Cost ( Relevant for PCC)
evant which price to be used to valuate Scrap during variance calculation ( Relevant
nal in case of WIP with Actual cost ( Production order / process order)
tionality , It takes he STD price to valuate the scrap
own strategy though valuation var for WIP and scrap i.e which price to be used to va
also specifies which type of cost to be compared
specifies which type of variance to be calculated
only for Target cost versions
specifies what is control cost and Target cost
Control cost - Taget cost

Control cost - Taget cost

Actual cost - STD cost
Control cost = Net of Actual cost = Total Actual cost-WIP-Scrap
Target cost = Actual GR qty X STD price
variance possible to calculate only for "0" version
variance only relevant for settelement to FI and COPA

Control cost - Taget cost

Actual cost - Plan cost
Control cost = Net of Actual cost = Total Actual cost-WIP-Scrap
Target cost = Plan GR qty X Plan cost
ction variance not relevant for settelement and used only for analysis purpose

Control cost - Taget cost

Plan cost - Std cost
Control cost = Plan cost
Target cost = Plan GR qty X STD cost
ariance not relevant for settelement and used only for analysis purpose
 Control cost - Taget cost
Actual cost - STD cost
ol cost = Net of Actual cost = Total Actual cost-WIP-Scrap
t cost = Actual GR qty X STD price
e possible to calculate only for "0" version
e only relevant for settelement to FI and COPA
 Control cost - Taget cost
Actual cost - Plan cost
Control cost = Net of Actual cost = Total Actual cost-WIP-Scrap
Target cost = Plan GR qty X Plan cost
ction variance not relevant for settelement and used only for analysis purpose

ble in OKEQ
 Control cost - Taget cost
Plan cost - Std cost
Control cost = Plan cost
Target cost = Plan GR qty X STD cost
ariance not relevant for settelement and used only for analysis purpose
cified Fixed % on Primary cost as Input Price Variance
%===>5%
nsumed===>100000INR for Production Order

case system calculates Input Price var = 100000inr X5% =5000

riance Indicator in the Controlling Area settings (OKKP)

% Against Cost element

ariances
rice variance in real time

gh KANK ( CO Number Ranges)

he variance
alculation and calculates scrap variance

s performed and changed during the variance calculation

tivate indicator
the plant
variance reports under Remaining variance

ing variance
r relevant var category i.e input qty variance
culation ( Relevant for all the cases)

ce to be used to valuate Scrap

lysis purpose
lysis purpose
Settelement
Settelement Profile
Allocation Structure
Source Structure
PA transfer Structure
PA==>Profitability Analysis

Define Settelement Profile for Production Orders

Receivers :
Order Item ====> to settele order to Joint and By Product( To d
Sales Order====> MTO( Non valuated SO Stock)===> Prd order
Material======> Always receiver is material for all mfg orders o
PSG==========> To transfer variances from Mfg Orders to the
GL===========> To post WIP and variance

Actual Cost / Cost of Sales

Which Cost to be setteled like actual cost Or Cost o

To Be setteled in Full
Settelement is manadator
Not possible to close the o
Normally selected To be se

Can be settele
Settelement becomes op
Possible to close the orde
Business Use Case :
 P&L
Actual cost(Ma 100000
COGM -80000
COGM -20000
Production Va 20000

Conclusion :
Example2 Partial Delevery order or Rel order

Order

P&L
Actual cost(Mat cost +Salaries)
COGM

Case1: Not setteled

Net Loss

Case2:Performed wIP and Setteled

WIP

Not For Settelement

Orders not relevant for settelement
Orders can not be setteled
Possible to close the orders or possible to set the deletio
Business Use Case :
1 Stastical Internal order ( N
 2 CS Order ( Customer servic

Valid Receivers
Which receivers allowed to be setteled

MTS (make to stock)Scenario for Mfg Orders who

MTO ( Non valuated stock) Scenario for Mfg Order

MTO ( SO is a cost object with valuated stock) Scen

Other Parameters
Doc Type
Which FI Doc type to be used to post the FI docum

Example:
Maximum number of Distribution Rules
How many maximum rece

Residance Time
Can be called as retintion
Field relevant for Archiving

Business Use Case : Archive of the settelement CO

Indicators:
100%-Validation :
 Type of the distribution Rules

Variance to Costing Based COPA

Default Values

Allocation Structure

Source Structure
PA Transfer Structure

Default Object Type

PA Transfer Structure

PA( Profitability Analysis) Transfer Structre for Mf

Sl.NO
1
2
 3
4
5
6
7
8
9

2 PA( Profitability Analysis) Transfer Structre for oth

 Sl.NO

1
2
3
4

Source Structure
Source structure contains the grouping of cost elements
PurposSource structure can used in the settelment rules w

Source Structure Defination :

Source structure contains the multiple assigneme
Possible to maintain distribution rules differently

Example1 : Requirement is that need to maintain differen

Source Structure
Assignement NO(SL.NO)

1
2
3

Example2 : Requirement is that need to maintain differen

 Source Structure
Assignement NO(SL.NO)

1
2
Source structure requied only for Mfg orders having the Joint and By P
Not required Source structure for Mfg Orders which doesn't have Joint
Why Source Structure required in Joint/By Product Scenario

In Joint and By product scenario ===> Total cost need to

Total Cost
Material cost

DOH

IOH

Source structure is required to address the above require

Source structure can also be used for other than mfg orders where you
Example : Source structure can be used in the IO settelem

Allocation Structure :
It specifies which source CE to be used which setteleme

Allocation structure required in the below cases for Mfg

1 Joint and By Product
2 MTO ( SO non Valuated Stock
====> Required in Joint /By Product scenario
====> Required in Joint /By Product scenario
=====>To transfer the variance classification wise to costi
 Joint and By Product( To distribute total cost between Joint and By Product)
d SO Stock)===> Prd order setteled to the Sales order
material for all mfg orders other than MTO with non vauated SO stock
es from Mfg Orders to the COPA

ed like actual cost Or Cost of sales ( SO costing)

Settelement is manadatory and cost need to be setteled fully

Not possible to close the order or not possible to set the deletion flag unless settele
Normally selected To be setteled in Ful for all manufacture order settelements

Settelement becomes optional that means you may settele or not settele
Possible to close the order or possible to set the deletion flag Eventhough Orders h
 Few Historical order ( Old order) cost which belongs to pre
In such case , now not possible to settele previous year o
So Not possible to close these o
Proposed solution to close the order as below
1 Keep the option Can be settele
2 Then Close the Historical orders
3 Keep the option To be settele i

Production Order
Actual cost 100000
GR to stock @STD 80000
Prod var 20000

No impact on Gain or Loss of P&L

 Actual cost 100000
GR1PC-> 35000
WIP 65000

100000
-35000
Losss 65000

65000

-65000
Loss/ 0

possible to set the deletion flag eventough orders having balance and system would

Stastical Internal order ( Not a real order just information purpose and budgetory co
 Stastical orders not relevant for settelement
CS Order ( Customer service order)
Billing based on Resource used( RRB )
In such case , We will do the billing dirrectly with referenc to service order co
Billing
Revenue
COS ( Service Order order)
In such case , Not required to settele service order hence we can keep Servic

e setteled

enario for Mfg Orders who is the valid Receivers====>Material( Cost setteled against

ock) Scenario for Mfg Orders who is the valid Receivers====> SDI ( Sales Order)

ct with valuated stock) Scenario for Mfg Orders who is the valid Receivers====> Mat

e used to post the FI document while settelement of Order

Example:
TO post WIP results to FI

FI entry FI Doc Type ????

Dr. WIP-BS
Cr.WIP-P&L ( Off of WIP Capital
 TO post the var to fI
FI entry FI Doc Type ????
Dr. Production var
Cr. COGM

tion Rules
How many maximum receivers alow to be permited
99

Can be called as retintion or retain time

Field relevant for Archiving Purpose

hive of the settelement CO documents

During execution of archiving program===> System it applies arichvings for th

It validates total receiver % of the settelement rules of the

Note : Irrespectve of the indicator, Not possible to settele t
Option1 If the Indicator Activated
It gives the warning message if the total receiver %
Incase of total receiver % is more than 100% then n
Possible to settele the order if the total receiver % is

Option2 If the Indicator is not Activated

It gives the warning message only if the total receiv
 No warning message if Total receiver % less than or
Incase of total receiver % is more than 100% then n
Possible to settele the order if the total receiver % is

% Settelement ===> Fixed % Method

Equilance Numbers ===> Fixed Portion

Amount Settelement ====> Fixed Amount

Note : Better to select All then you can decide which rule to be followed whi
Portion interms of %
100 6.667
600 40
800 53.33
Total 1500 100

ed COPA
This indicator relevant fo
Main purpose is that to
 It is Relevant for Costing based COPA to trnsfer the values from other compo

In Costing Based COPA , The values ie cost and reven

PA Transsfer structure contains the mapping rules between Source CE ( Send

Mapping rules specified in PA t

Source CE
20000 Revenue
20001 Misc Revenue
COGSCE
Travelling CE

is) Transfer Structre for Mfg orders ( Prod order / Process orderr/ cO prd order/ pCC
To transer production Variance category wise to the Costing Based COPA

PA Trf str for Prd Var

Mapping rules ===> Value field=====> Source CE+Variance category
Description CE/CEG Var Cat
Input Price Var Total CEG PRIV
Input Qty Var Total CEG QTYV
 Resource Usase Var Total CEG RSUV
Remining Input var Total CEG INPV
Scrap Var Total CEG SCRP
Lot Size var Total CEG LSFV
Mixed Price Var Total CEG MXPV
Output price var Total CEG OPPV
Remaining Var(Misce) Total CEG REMV

Total CEG = Material consumtion CE(1) + Acty CE(43) +OH CE(41)===> Those c

is) Transfer Structre for other than Mfg orders ( SO/CS order/ IO order/ CC/ FI /wbs)
To transfer cost and revenue from SO/CC/IO/WBS/FI to th
 PA Trf str
Mapping rules ===> Value field=====> Source CE
Description CE/CEG(Source CE)

Revenue Revenue CE(11)

COS(Cost of Sale) cOGS(1)
Sales Expenses Sales Exp GL(1)
Travelling Exp Travelling Exp(1)

grouping of cost elements

ed in the settelment rules where you need to maintain different distribution rules ( D

ins the multiple assignements and each assignement represents the grouping of spe
istribution rules differently for each source structure assignement wise in the settele

at need to maintain different distribution rules for mat cost , DOH and IOH

DescripSource CE/CEG

MateriaMaterial consumtion CE
DOH Direct OH CE (43)
IOH Indirect OH CE(41 /43)

at need to maintain different distribution rules for mat cost and OH

 DescripSource CE/CEG

MateriaMaterial consumtion CE
OH OH CE (43 and 41)
rs having the Joint and By Product Scenario .
rs which doesn't have Joint and By Product Scenario
Product Scenario

io ===> Total cost need to be distributed between main Product and By products

FGX(Main Prd) FGX1(By Prd1)

==>% 80 15

==>% 60 20

==>% 65 15

o address the above requirement

than mfg orders where you need to maintain different distribution rules based on Gr
n be used in the IO settelement rules ,WBS settelement rules, CS order settelement r

CE to be used which settelement CE and which receivers allow to be setteled

ed in the below cases for Mfg Orders ( Production order , Process Orders , CO Prd Order , PCC O
Joint and By Product
MTO ( SO non Valuated Stock)
ation wise to costing based COPA ==> Relevant for Costing based cOPA
roduct)

ag unless settele full cost of the order

ttelements

hough Orders having Balance and system gives warning message like order having b
h belongs to previous years cost not setteled.
previous year order cost in the current year
to close these orders unless the settele thecost fully

Can be settele in the Settelement Profile

Historical orders which need to be closed
To be settele in FULL in the Settelement Profile

===> If you settel===> What is impact of P&L ====> DR. Prod Var (P&L) 2000

BS
Stock 80000
 BS
Stock 35000

BS
Stock 35000
WIP 65000

nd system wouldn't give any messages

nd budgetory control purpose used)

service order cost

der order)
can keep Service order settelement profile not relevant for settelement

setteled against mat) , PSG ( Prd variance transfer to cOPA), GL Account

es Order)

vers====> Material( Cost setteled against mat) , PSG ( Prd variance transfer to cOPA)

pe ????

ff of WIP Capitalisation
pe ???? CO Doc ( CO Business Transactions-KANK)

Cr. Prd Order

60 months

arichvings for those documents crossing the Resdance time i.e moved phisically from
===> Those Documents less than residance time==> it keep as it is in the cur

ent rules of the order

sible to settele the order if the receiver rule % is more than 100%

otal receiver % is more than or less than 100% but possile to save the settelement ru
an 100% then not possible to settele the order
tal receiver % is less than or equal to 100%

the total receiver % is more than 100% but possible to save the settelement rules
r % less than or equal to 100%
an 100% then not possible to settele the order
tal receiver % is less than or equal to 100%

===> It allow to maintain Fixed % in the settelement rules

===> It allows to maintain the fixed ratios

===> It allow to maintain Fixed amount for the receivers

be followed while maintaing settelement rules for the order

ator relevant for Costing based copa and relevant for Mfg Orders ( Production order/
rpose is that to transfer the production variance category wise( Variance clasification
om other components ( FI, CC, Mfg Orders, Sales ordes, wBS, IO , CS orders ) to the C

e cost and revenue saved against value field

Value field represents cost and revenue in costing based copa

ource CE ( Sender CE) with Value fields

specified in PA transfer Str

Value Fields
VVA01
VVA01
VVA02
VVA03
PCC====> Product cost collector
prd order/ pCC Order)
Based COPA

ategory
Value Field
VVR10 Note :
VVR11 Value Field codes are user defined c
 VVR12 Var category code are sAP predefine
VVR13 The relevant variance category reco
VVR14
VVR15
VVR16
VVR17
VVR18

41)===> Those cost elements used to book the cost to the orders

er/ CC/ FI /wbs)

O/WBS/FI to the Costing Based cOPA
 Value Field

VVR20
VVR21
VVR22
VVR23

ibution rules ( Differet % , Different receivers) based on Grouping of Cost elements

grouping of specific cost elments

se in the settelement rules
By products

FGX2(By Prd2)
5

20

20

ules based on Groping of cost elements

er settelement rules , AUC settelement Rules etc

Prd Order , PCC Orders)

like order having balance but we can ignore warning message and possible to close
Prod Var (P&L) 20000 and Cr. cOGM(P&L) 20000
ce transfer to cOPA), GL Account
ansactions-KANK)

oved phisically from current sytem to the Archiving system

ep as it is in the current system.

the settelement rules

settelement rules
element rules

the receivers

( Production order/ Process order/ CO Prod order / pcc order)

ariance clasification wise) to the costing based COPA
CS orders ) to the Costing Based cOPA

s are user defined codes( Own codes)

e are sAP predefined codes
ance category recognises the relevant variance from the cost element group
of Cost elements
possible to close te orders
nt group
 Responsabilty====> PP Consultant
PP Settings
Define Order Types
Save
save
Note:
PP Order type controls the Order creation and Orde
PP Order types assignes number to the Order
PP Order Type contains the default parameters like
these default parameters by default copies fr

Order Category :
Order Category it specifies in which app
Order category controls the screen layo
Below is the SAP Pedefined Order Cate
 Below are the Production Order categories

10 Production Order
04 CO Production Order
05 PCC Order ( Product Cost collector)
40 Process Order

Define order type-dependent parameters

Same path
 Copy===>Enter====>Save

Save
Define Scheduling Parameters for Production Orders
img--> Production--> Shop Floor Control--> Operations--> Scheduling--> Defin
Save
Extend to other Plants
 Enter then Save

Define Confirmation Parameters

img--> production--> shop floor control--> operations--> confirmations--> De
Save
 Save

Define Checking Control

img--> production--> shop floor control--> operations--> availability check-->
It checks the availability of the material and also specifies how the syst
It checks while creating order and also at the time realising Order
 Save

Save

Maintain Task List Type for Material Type(OP50)

IMG>Production>Basic data>Routing>General Data>Defn Material Type assig
We are which type of Type Task list type ( Type of routing) to be permitt
 Save

Which task list type allowed for which material typ

Task List Type : It specifies which application areas allow t

N Routing ====> Used in Production ord

2Receipe ====> Used in Process Order (

R Rate Routing ====> Used in PCC ( Repetetiv

Maintain Overall plant Maintaince Parameters (OPPQ)

IMG>Production>Material Requirement Planning>Plant Parameters>C
Save

Plant Y101
Which PP Order type to be used while converting plan ord
 Save

Control Key
PP Consultant will take care
Control Key

It Specifies How the operational activities performed

that means confirmation is manadatoy or

Mile stone confirmation :

All procedding operations w

Example :
Routing Operations
 1 OP10

2 OP20

3 OP30

In the above case , If we confim la

Control key specifies wether relevant routing oper

Control key also controls wether operations allow

Control key also specifies wether to perform Auto

Control key also specifies wether allow to perform

Control key also specifies wether to consider sched
Control Key PP01
in S/4 HANA
YBP1 Control Key For Internal Processing
YBP2 Control Key For External Processing

Save

YBP3 Auto GR with Confirmation Required

YBP5 AUTO GR with Mile stone confirmation

Save

Y0 Valuation Variant ==>Std , Plan and Actual

Costing var1 Std Cost

Costing var2 Plan cost

Costing var3 Actual cost
 e Order creation and Order Master data fields
number to the Order
e default parameters like Settelement Profile , Costing var and RA key
meters by default copies from the order type to the Order

ry it specifies in which applicaion areas allow to be used

y controls the screen layout of the Order
AP Pedefined Order Categories
Order categories

n Order
roduct Cost collector)
 t.code opu3
ations--> Scheduling--> Define Scheduling Parameters for Production Orders
 t.code opk4 or opk4n
tions--> confirmations--> Define Confirmation Parameters
 t.code opjk
tions--> availability check--> define checking control
d also specifies how the system should respond ====> Allow to create or not allow t
he time realising Order
ta>Defn Material Type assignements
( Type of routing) to be permitted for Specific Mat Type
owed for which material types

h application areas allow to be used

=> Used in Production order ( Descre Mfg)

=> Used in Process Order ( Process industries)

=> Used in PCC ( Repetetive mg)

PCC===> Product Cost collector

anning>Plant Parameters>Carry out overall plant maintaince parameters

while converting plan order into production order
tivities performed
nfirmation is manadatoy or optional or not required

All procedding operations will be confirmed automatically while confirming last ope
 ==> Control key with mile stone confirmation

above case , If we confim last opertion 30 then system automatically confirms the pr
System it books the activity time as per planned time

wether relevant routing operations is relevant for costing or not

ols wether operations allow to be performed externally ( External operations) or Inte

fies wether to perform Auto GR during the confirmation of operations

fies wether allow to perform rework related operations

fies wether to consider scheduling , capacity determinations
nternal Processing
xternal Processing

nfirmation Required
e confirmation

==>Std , Plan and Actual

r and RA key
tion Orders
create or not allow to create order
ameters
e confirming last operation
cally confirms the preceding operations like op 10 and op20

al operations) or Internally processed or Both