Profitability Analysis CO-PA

Course Objectives
Understand

the functions in Profitability Analysis. Explain Profitability management in SAP. Understand CO-PA structures and master data. Identify the source of actual values. Understand planning. Use the CO-PA information system.

Table of contents
Course Map
Module 1: Overview Module 2: Profitability Management Module 3: Master Data Module 4: Planning Module 5: Actual data flow Module 6: Information System

Profitability Analysis at A Grp

Profitability Analysis will enable A Grp to analyze the profitability of market segments according to the following characteristics:
Products Customers Sales Districts (i.e. USA West, USA East, Saudi Arabia etc.) Others

Product

CO Module Overview
CO PA

Profitability Analysis
How profitable are individual market segments?
CO PC

EC PCA

Profit Center Accounting

Overhead Cost Controlling

How can we reduce our overhead?
CO OM

Are the responsibility areas working efficiently? How high are the organisational activity costs? Are they within their budgets? How can we optimise our internal business processes?

Product Cost Controlling

What are the

Manufacturing
Costs of a product?

CO CEL

Overhead Cost Controlling

What costs occur within the organisation?

How Profitable are Individual areas?

Flow of actual values in Profitability Anal.

CO CO PA

Profitability Analysis
Overhead Cost Controlling

Profit. segments

Product Cost Controlling

Product Cost Collector Standard Cost Estimate

Cost Centers

Cost and Revenue Element Accounting FI

ML

Revenues Discounts

SD

Table of contents
Course Map
Module 1: Overview Module 2: Profitability Management Module 3: Master Data Module 4: Planning Module 5: Actual data flow Module 6: Information System

Aspects of Profitability Management

PCA PA

Responsibility Accounting
(Company oriented)

Profitability Analysis By Market segment

(Market oriented)

Profitability Segments 2000 100

Revenue Salaries

2000 468

Revenue Discounts

External Market

Materials
Profit

230

COGS
Contr. Margin Advertising

230
1440 250

Profit Centers

Procurement

Production

Sales

Distribution

Terms used in Profitability Analysis

Accounting Methods
Period Accounting Cost of Sales Accounting

Values
Gross Sales Net Sales Variances

Ratios
Economic Profit Contribution Margin

Methods of Determining Profits

Period accounting method
Revenues Sales

Cost of Sales method

Revenues Sales

deductions Changes in stock Capitalized internal services Work in process

deductions Cost of sales (incl. variances for period)

Total activities
Total

Gross result
Sales

costs: Material costs Personnel costs Other costs

and distribution costs Administrative costs Research & Development

Result

Result

Aspects of Profitability Management

Characteristics

CO-PA costing-based

EC-PCA

profit center

Aims of profitability accounting Calculation of profits

Sales and
profitability controlling

Enterprise controlling

cost-of-sales method

period accounting

and cost-of sales

methods

profit-related Key figures Reconciliation with FI key figures

profit-rel. key fig. balance sheet fig.

posted and imputed values

posted values

Profitability Analysis by Market Segment

Product Customer Region Sales office

Business Unit

Reporting Dimensions
Sales Quantity Sales Revenue Customer discount Sales commission Direct sales costs Net revenue Direct material costs Variable production costs Contribution margin I Indirect overhead Fixed production costs Contribution margin II Variances Contribution margin III

Determine and analyze the profitability of market segments

Revenue

Cost

Operating profit

Table of contents
Course Map
Module 1: Overview Module 2: Profitability Management Module 3: Master Data Module 4: Planning Module 5: Actual data flow Module 6: Information System

Master Data Currency of Op. Concern

CO PA

Profitability Accounting (costing based)

Operating Concern 9100
Currency B0 = SAR

Master Data in Profitability Analysis

Cost Element

Cost Element Accounting

Profitability Analysis

Profitability Segment

Characteristics Value Fields

Profitability Segments

Product (SBU)
Ethylene Glycol

Master Data in Profitability Analysis

Profitability Segment - object within Profitability Analysis to which costs and revenues are assigned. A profitability segment corresponds to a market segment. You can calculate the profitability of a profitability segment by setting off its sales revenues against its costs. A profitability segment in an operating concern is defined by a combination of characteristic values. Characteristics can be concepts that already exist in the R/3 System (customer, product, sales organization, and so on).

Profitability Segment

Categories of Characteristics (1)

Fixed Characteristics
Characteristics delivered by SAP

Predefined Characteristics

Characteristics

are valid in all clients

Characteristics

are available for all Operating Concerns

Categories of Characteristics (2)

Fixed Characteristics
Characteristics delivered by SAP

Predefined Characteristics

Characteristics created by Customer

Characteristics copied from SAP Reference Tables Custom Characteristics

Categories of Value Fields

Value Fields delivered by SAP

Predefined Value Fields

Value Fields created by Customer

Custom Value Fields

Segments

Table of contents
Course Map
Module 1: Overview Module 2: Profitability Management Module 3: Master Data Module 4: Planning Module 5: Actual data flow Module 6: Information System

CO-PA Planning Objectives

Plan Integration Plan Versions Creation of a sales plan using planning level and planning packages Plan Data Transfer

CO-PA Planning Objectives

Plan Integration Plan Versions Creation of a sales plan using planning level and planning packages Plan Data Transfer

Plan Integration
Profit planning - V1

Sales Planning planning SOP

Profit planning V2

Sales volume

Cost of goods manufactured

Production LTP

Product costing

Activity price Activity quantities Cost centers

CO-PA Planning Objectives

Plan Integration Plan Versions Creation of a sales plan using planning level and planning packages Plan Data Transfer

Plan Version 0 SABIC

General Version Definition
Version Plan Actual 0 0

Settings for CO-PA

Version Locked

Currency type
Exchange Rate
1.

P B0 1
P 2 M

Fiscal year dependent parameters in CO-OM

1 Integrated Planning
2.

The currency type determines the currency or valuation view in which the amounts are to be displayed or planned. B0 - Operating Concern Currency Controls the exchange rate type, i.e. Buying rate, selling rate or P Standard translation for planning.

1.

Plan records are posted as line items from respective areas.

CO-PA Planning Objectives

Plan Integration Plan Versions Creation of a sales plan using planning level and planning packages Plan Data Transfer

Overview of Planning Framework

Overview of Planning Framework

Maintain Planning Level-Package-Set-Personalization Copy Sales Plan Upload of COPA Plan - Offline Planning Manual Profit Planning Valuation Planning Method Event Planning Method Period Distribution Planning Method Ratio Planning Method Planning Forecast Revaluation Planning Method

CO-PA Planning Objectives

Plan Integration Creation of a sales plan using planning level and planning packages Plan Data Transfer

Plan Data Transfer

Microsoft Excel
St

SOP
t

CO PA

Table of contents
Course Map
Module 1: Overview Module 2: Profitability Management Module 3: Master Data Module 4: Planning Module 5: Actual data flow Module 6: Information System

Actual Values Overview

Flow of Actuals in Profitability Analysis

Overview Flow from the Sales and Distribution (SD) Module

Flow from Billing Document

Flow from the FI/MM direct postings

General Ledger Posting MM Postings

Flow from the Product Costing

Settlement of Production Variances to PA

Actual Values Overview

Flow of Actuals in Profitability Analysis

Overview Flow from the Sales and Distribution (SD) Module

Flow from Billing Document

Flow from the FI/MM direct postings

General Ledger Posting MM Postings

Flow from the Product Costing

Settlement of Production Variances to PA

Flow of actual values in Profitability Anal.

CO CO PA

Profitability Analysis

Profit. segments

Overhead Cost Controlling

Product Cost Controlling

Product Cost Collector Standard Cost Estimate

Cost Centers Internal Orders

Cost and Revenue Element Accounting

FI

MM

Revenues Discounts

SD

Sources of value fields

Source Transaction Value Field

Billing Document

Quantity Revenues

Sales deductions Cost of Goods Sold

Direct Posting from FI

Freight costs Inventory re-valuation

Actual Values Overview

Flow of Actuals in Profitability Analysis

Overview Flow from the Sales and Distribution (SD) Module

Flow from Billing Document

Flow from the FI/MM direct postings

General Ledger Posting MM Postings

Flow from the Product Costing

Settlement of Production Variances to PA

Flow from sales and distribution (1)

CO PA

V A L U E F L O W

NO POSTING

Inventory Inventory - Finished Product (FG) 119430 4,975.00-

Stock FI

Cost of Goods Sold 462002 4,975.00

Change Stock

Business process

Goods Issue

MM

Flow from sales and distribution (2)

CO PA

V A L U E F L O W

FI

Receivables

Standard Price

Cost of Goods Sold

10,000
Sales

+
Product Cost Estimate

810000
10,000 -

Business process

Sales/Billing

SD

Actual Values Overview

Flow of Actuals in Profitability Accounting

Overview Flow from the Sales and Distribution (SD) Module

Flow from Billing Document

Flow from the FI/MM direct postings

General Ledger Posting MM Postings

Flow from the Product Costing

Settlement of Production Variances to PA

Flow from FI/MM

V A L U E F L O W FI

CO PA

Flow from FI/MM

CO PA

V A L U E F L O W

FI

Accr. GR/IR
219914

15.00
Demurrage &Detention
484013

15.00 -

Actual Values Overview

Flow of Actuals in Profitability Accounting

Overview Flow from the Sales and Distribution (SD) Module

Flow from Billing Document

Flow from the FI/MM direct postings

General Ledger Postings MM Postings

Flow from the Product Costing

Settlement of Production Variances to PA

Flow from CO-PC

Goods Issues of materials from stock Production Order Plan costs

CO PC

Product Costing

+ Actual costs ...

...
Delivery
Variances
CO PC

Confirmations/ activity allocation

MM
Warehouse

Delivery to stock

Calculate variances Settlement

FI

CO PA

Flow from CO-PC

Variance Category
Cost Element Group PA Assignment lines Value Field

Table of contents
Course Map
Module 1: Overview Module 2: Profitability Management Module 3: Master Data Module 4: Actual data flow Module 5: Planning Module 6: Information System

Report Output

Drilldown List

Detail List

Course Summary
You should now: Have an understanding the functions in Profitability Analysis. Understand CO-PA structures and master data. Identify the source of actual values. Understand planning. Use the CO-PA information system.