Revenue and Costing Process

Program Profitability Note: All COS items Production Folder Cost Centre Report
requires one GLAC each.

Revenue Cost of Sales WIP HR/ Payroll

Salary and related costs
Manufacturing
Cost Trading Costs
MFG F Material Resource (Labor)
T&L expenses
A C Concur
9. Depreciation Material
by project B Variance Material
Overhead (FOH) Fixed Assets 9. Depreciation policy –
TRADING Overhead (F&I) [3.25 times Labour ]
12. Design Sub-ledger charge to CC
Production [4% times Materials]
Adequacy D Variance
Processing Other 10. Allocation Basis
13. Warranty (Subcon) production • Resources by salary dollars
Provision E cost • Facilities by floor area

Revenue F Purchase
Recognition E Order (Expense $
Customer
and Unbilled Post Goods & Inventory)
Receivable Issue (Relieve 11. Issue part
Sales Places Order
at average cost 2. Requisition
Inventory & Standard
14. Automated limits Time Standard
Order Book COGS) resources and vs Actual cost X
reconciliation Clocking Rate
A Vendor overhead cost
of Unbilled Finished
$ Receivables Goods D
C
Inventory Goods Receipt Material
1. S&OP Trading Sales Raw Material CC Actual
Customer Perform Billing (Expense Items vs 8. Standard costing for
Process Inventory Costs Overhead (F&I)
(Record AR and & Inventory) Resources (Labor) – by
offset Unbilled Create Delivery B [4% times Materials]
(Pick, Pack, 3. Batching of staff band
Receivable) 4. Inventory valuation B
& Ship)
policy (moving average) goods receipt 7. Material
Invoice overhead costing
Shipment 5. Material issue – FIFO
6. Stock obsolescence
policy 1
 Planning – Make to Order S/4H features
• MRP Live
• Embedded PPDS

SAP CO SAP PP
Consumption based
Release Cost planning for Raw
Estimate Material / Low value
Component

Planning @ SAP PP SAP PPDS SAP PP

SAP PP SAP PP SAP PP
Sub-Assembly
Forecast Planned Firmed Planned
Planned Order for
Planning @ (Sales & Operations Independent MRP Live Detailed Scheduling Order for Sub-
Raw Material Sub-Assembly
Planning) Requirement Assembly
S/4H S/4H

Forecasted Dependent
Demand Demand

SAP MM
Purchase
Requisition for
Raw Material

Procure to Pay process Plan to Produce process

Execution – Make to Order SAP PP
S/4H features
• MRP Live
• Embedded PPDS
MRP Live
SAP PP SAP PP Non-SAP

Firmed Planned Via SAP Via SAP S/4H Order to Cash process
Confirmation of Shop Floor Control MES /
Order for Sub- MES /
Production Order Manual
System Manual
Assembly SAP PP SAP SD

Planned Order for

SAP PP Final-Assembly Sales Order
SAP PP SAP PP
Convert Planned Goods Receipt for
Release Production
order to Production Sub-Assembly
Order SAP PP SAP PPDS
Order SAP CO
Reservation
(Transfer of Material Detailed Scheduling Sales Order Cost
to Production Loc) Estimate
SAP PP SAP PP SAP QM S/4H

Quality Inspection
Goods Issue SAP PP SAP PP
Pick List of Sub-Assembly
(Consumption) Production Order SAP SD
Material transferred Material
to Production execution is same
Delivery of Sales
Location as Sub-Assembly
Order

SAP MM SAP MM Goods Issue Goods Receipt &

Inventory Management
(Consumption) Quality
Approved SAP QM
Approved Inspected
Sub-Assembly
Raw Material Pre-Delivery
Material SAP MM
Inspection /
Approved
3rd Party Inspection
Final-Assembly
Procure to Pay process Material

SAP MM SAP QM
SAP QM
Quality Inspection
Goods Receipt of
of Incoming Approved for
Raw Material
Material Delivery
 Planning – Make to Stock S/4H features
• MRP Live
• Embedded PPDS

SAP CO SAP PP
Consumption based
Release Cost planning for Raw
Estimate Material / Low value
Component

Planning @ SAP PP SAP PP SAP PPDS SAP PP

Final-Assembly SAP PP SAP PP
Firmed Planned
Forecast Planned Planned Order for
Order for
Planning @ (Sales & Operations Independent MRP Live Final Assembly / Detailed Scheduling
Raw Material Final-Assembly /
Planning) Requirement Sub-Assembly
Sub-Assembly
S/4H S/4H

Forecasted Dependent
Demand Demand

SAP MM
Purchase
Requisition for
Raw Material

Procure to Pay process Plan to Produce process

Execution – Make to Stock S/4H features
• MRP Live
• Embedded PPDS

SAP PP SAP PP Non-SAP

Firmed Planned
Order for Confirmation of Via SAP Shop Floor Control Order to Cash process
MES /
Final Assembly / Production Order Manual
System
SAP SD
Sub-Assembly

SAP PP Sales Order

SAP PP SAP PP
Convert Planned Goods Receipt for
Release Production Final Assembly /
order to Production
Order SAP PP Sub-Assembly
Order
Reservation SAP SD
(Transfer of Material Delivery of Sales
to Production Loc) Order
SAP PP SAP PP SAP QM
Quality Inspection
Goods Issue SAP PP
Pick List of Final Assembly /
(Consumption) SAP QM
Material transferred Sub-Assembly
to Production Pre-Delivery
Location Inspection /
3rd Party Inspection

SAP MM SAP MM SAP MM

Inventory Management
Approved Approved
Approved SAP QM
Sub-Assembly Final Assembly
Raw Material
Material Material
Approved for
Delivery

Procure to Pay process

SAP MM SAP QM
Quality Inspection
Goods Receipt of
of Incoming
Raw Material
Material