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Calculation
created by raja sekhar on Jan 31, 2013 5:45 PM, last modified by
Jan 31, 2013 7:01 PM

raja sekhar

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HI Team,
This document will describe the WIP Calculation form the Project System. Basically the
Project System comes under the ETO Scenario i.e., MTO
Here I am not going to describe the Project Structure & I am straight way going to present the
calculation part of the WIP Calculation.
For understanding better I am going to describe the example of requirement.
Requirement : WIP Calcualtion based on the Qty Deliverable. For Ex; I have a
WBS with 2 Qty Deliverable & Cost occured for the respective WBS would be
1000/- till now. Then the WIP would be Rs.5000/- for the first month of my WIP
Calcuation. In the 2nd month 1 Qty was delivered then the 2nd month end my WIP
would be Rs.2,500/- ie., based on my deliverable Qty (Percentage of Completatioin
(POC) Method)
1) Creation of Project : Creation of Project with the 2 WBS Elements in the 2nd level & 1
WBS Element would be the 1st level. All the WBS elements should be activated with Account
Assigment Category . RA Key is the important key to calculate the WIP & it should be
assigned to all the Delierable WBS Elements
For better understanding i have taking the WBS Structure like below :

Project
1st Level
WBS

Project A-0001

1st Level
WBS

2nd Level
WBS

A-0001

2nd Level
WBS

Acc ***
Cat

Billing
Document

RA Key

YES

YES

YES

A-0001-01

YES

A-0001-02

YES

.
2) Sales Order Creation : Sales Order Creation with 2 Qty with the WBS A-001 Account
assignment & the revienue updates into respective WBS Elements & the same can be visiable
in reports

3) Planned Qty maintance : CJS2

Planned Qty should maintained with the Statistical Key Figure (SKF) ABGMNG to calcualted
the Qty based the WIP. ABGMNG is the SAP standard SKF & the same should be use in this
case.

4) Expness booking to the respective WBS :

The cost booked into the 2 WBS elements
through direct posting from FI. Total Cost would be Rs.5000/CJI3 Report :

5) Running the WIP KKA2 : Running the WIP Calcualtion for the respective the WBS

In above activity you can able to idenfity the Actual cost & WIP Amount. You can also obser
the POC % is 0. This only stastical posting. If every thing found correct then it should be
saved. In he next step it ll be update to the FI.
6) Rulling the Settlment CJ88 : At the time of settlemtn sytem ll consider the WIP Amount
which was calculated in the previous step & ll post to FI side. The account document would
be
WIP Account A/C ( P & L A/C) Dr.............. 50000 ( This account shold not be cost elemeent &
precation should be taken care at the time of this account)
WIP Account A/C ( B / S A/C)
50000

This is month end activity & the amout aupdated in FI books of accounts. If suppose the
coming moth 1 qty ll be delivered then the impact wouild be ..! let see.
7)1 Qty Deliverty from SD : VL01N : Nothing to do in this step for this WIP Calcuation.
8) Maintain the Deliverable Qty KB31N : This is important point & needs to maintin the 1
Qty here then only you ll get the impact on WIP Calcualtion. Hence 1 Qty was delivered &
the same 1 Qty has been maintaned here.

9) WIP Calculation KKA2 : Second month WBs caculation. As per as the above
requirement my my WIP would be 2500/- since 1 Qty was delivered (50% POC)

Here you can find the WIP Amount Rs.2500/- & the WIP POC would be 50%. If the calcualtion
is correct then its required to save the WIP

10) Settlement CJ88 : Here the amoutn 2500/- would be accounted as WIP.

Its going on.., until unless the WBS status would be TECO or DLV. Once its TECO or DLV then
the entire WBS would be reversed.
I have shared only one insight on the WIP Calculation & there are several methods would be
available on WIP Calcuations based on the client requirement. I have not covered the RA Key
configuration in this post. Here you can find the WIP methods i.e., each & every method
would have the different accounting impact.
WIP Methods are :

Any suggestions or views would be appreciated.

Regards

20

May 11

Prepaid RA with Quantity Based Method

16:07 // Salim Shakir

I have a scenario in result analysis as follows:

1.

The customer pays the full amount at the start of the project (prepaid).

2.

Before we incur costs this billed amount has to be deferred.

3. Once we start booking T&M to the project we would recognize the revenue based on a
POC method.
4. We want the POC method to be quantity based. e.g. Planned hours divided by actual
hours
How do we configure this scenario?

Response:
Gokul - I used RA method 05 - Quantity based POC method. In expert mode refer SAP
note number 765748, create a line id STD and assign category "K" and the unit of measure
"Hours" to the line ID "STD".create a statistical key figure ABGMNG in trans KK01 then
iImplement Note 544420 for corrections, Create the customer enhancement 2 (Note
26957).
The above is for qty based RA. Now for prepaid instead of invoicing the DMR invoice the
main sales order during the first month. once you run RA and settlement the entire amount
is deferred. from next month onwards the accruals will happen based on cost of sales with
corresponding deferrals
Thanks
Salim Shakir