Tackle Your Most Common Financial Pain

Points Using Existing and New SAP

Functionality

Paul Ovigele, ERPfixers

Janet Salmon, SAP SE
Produced by Wellesley Information Services, LLC, publisher of SAPinsider. © 2016 Wellesley Information Services. All rights reserved.
In This Session

• Reconcile profitability analysis within the controlling module with the SAP General
Ledger
• Implement parallel accounting using the ledger approach
• Make your actual cost of sales more transparent through little-known cost component
split functionality
• Pinpoint new functionality in SAP enhancement package 5 that’s now available to help
streamline profit center and segment reorganization
• Create drill-down reports for multidimensional analysis of your financial data
• Successfully utilize summarized analysis reports for product costing and controlling

1
What We’ll Cover

• Reconciling CO-PA with the General Ledger

• Implementing Parallel Accounting
• Using Cost Component Split Functionality
• Profit Center and Segment Reorganization
• Creating Drilldown Reports for Multi-Dimensional Analysis
• Utilizing Summarized Hierarchies to Aggregate Product Costs
• Wrap-Up

2
Overview of Controlling Profitability Analysis

• Collects Revenues and Costs from various modules in order to analyze profitability
• Inherits the characteristics that are associated with those revenues and costs
• Examples of Characteristics are Customer, Product, Region, Salesperson, etc.
• Excellent tool for analysis but not easily reconcilable with the General Ledger

3
Costing-Based CO-PA

• Groups costs and revenues into Value Fields

• Value fields are mapped to Conditions, G/L Accounts, Cost Components, and
Variance Categories
• This was the original model of CO-PA
• When people say CO-PA they are normally referring to “Costing-Based” CO-PA

4
Account-Based CO-PA

• Uses Accounts as a basis for reporting

• All P&L Accounts would need to be created as cost or revenue elements
• Categories of cost and revenue elements are classified according to cost element groups

• This type of CO-PA was introduced because accountants complained about not being
able to reconcile costing-based CO-PA to the general ledger

5
Advantages and Disadvantages
Advantages
• Splits the cost of sales value into its
different cost components
• Can classify production variances into
their different categories
• Better visibility of contribution margin
as fixed and variable costs can be
broken out
Disadvantages
• Does not show G/L Accounts, hence, not
as easily reconcilable
• More complicated to set up as it requires
mapping of value fields to various objects
6
Advantages and Disadvantages (cont.)

Advantages Disadvantages
• Displayed according to G/L Accounts so it • You cannot break out cost of sales into
is easier to reconcile to the General their fixed and variable costs
Ledger • You cannot analyze variances into their
• As you can still report by characteristics, respective categories
it can also be compared with Costing- • You cannot analyze cost of sales
based CO-PA reports according to cost components

7
Data Flows into CO-PA

8
Timing Difference of Goods Issue

Transaction General Ledger CO-PA

Sales Order Not Updated* Not Updated
Goods Issue Updated (COS) Not Updated
Billing Document Updated (Revenue) Updated (COS and
Revenue)

* Note: CO-PA can be updated from sales orders if you activate “Transfer of Incoming
Sales Orders”

9
Configure Cost of Sales Condition and Account Key

• You can copy condition VPRS to ZPRS (V/06)

• Assign this condition to your pricing procedures (V/08)
• Assign Condition ZPRS to the Cost of Sales value field (KE4I)
• Create an account key “ZPR” using the menu path:
 Sales and Distribution  Basic Functions  Account Assignment/Costing  Revenue
Account Determination  Define and Assign Account Key
• Assign this account key to the ZPRS condition in the pricing procedure (transaction V/08)

10
Configuring “Shipped Not Billed” Account and Cost Element

• Create “Shipped Not Billed” balance sheet account and set “Open Item managed
Account” checkbox (FS00)
• Enter this account under transaction Key GBB and Account Modification VAX (OBYC)
• Create the Cost of Sales cost element and with cost element category of “12 – Sales
Deduction” (KA01)
• Assign the account key ZPR to the G/L Accounts “Shipped not Billed” and “Cost of
Sales” (VKOA)

When you bill a customer, the “Shipped not Billed” account

will be credited and the “Cost of Sales” will be debited

11
Stock Transport Order Variance Issue

• A Stock Transport Order Variance, which is posted using transaction VL02N, does not get
posted to CO-PA
• This is because this transaction is posted as a goods issue. Goods issues do not pass to
CO-PA because they are expected to be billed.
• However, STOs are not billed, so there is a discrepancy
• You need to apply SAP Note 1167439

12
Credit/Debit Memos with No Inventory Adjustments

• Some credit/debit memos relate to price adjustments alone

• However, if you enter an inventory material number in them the system will determine
their standard cost
• This means that a cost will be transferred to CO-PA even though there has been no
inventory movement
• You may need to disable the VPRS condition for these type of Credit/Debit Memos
• Alternatively, you can use a text material (which does not have any standard cost)

13
Cost Element Category for Sales Order Condition

• Sales conditions that are mapped to value fields should be assigned to the appropriate
G/L Accounts
• These G/L accounts are mapped to sales conditions through the use of account keys
• The G/L Accounts should be set up as cost elements with Cost Element category 11 or 12

14
Making Production Variance Account a Cost Element

• Variances are posted to CO-PA through the mapping of variance categories to

value fields
• A variance G/L account is also posted to at the same time (configured in transaction
OBYC – Transaction Key: PRD-PRF)
• This G/L account should not be a cost element as this could lead to a double-posting
in CO-PA

15
Negative Discount Conditions

• A negative sales condition (i.e., deduction from Revenue) shows up in CO-PA as a

negative number
• However, Revenue shows up in CO-PA as a positive number
• This means that if your CO-PA reports contain a formula that deducts discounts from
Sales, this will be a double negative (hence an addition to sales)
• Therefore, if you add these (negative) discounts to revenue, be careful about FI-generated
discounts as they appear in CO-PA as positive amounts
• The recommendation is to use different value fields for Sales Condition Discounts, which
are negative, and FI-Generated discounts, which are positive

16
Cost Center Allocations Not Fully Absorbed

• If you have created cost center assessments to CO-PA, these need to be executed
every month
• This will ensure that all cost center costs eventually flow to CO-PA
• You need to check all the cost centers at month-end to ensure that they are zeroed out

17
Posting in CO-PA Without Corresponding G/L Entry

• CO-PA-only postings can be made using transaction KE21N

• However, if these postings are made without a corresponding FI entry, then this can lead
to an imbalance
• These postings should only be used in emergency cases or when a reconciliation issue
needs to be fixed

18
 SAP S/4HANA Finance

“ The world’s leading Finance solutions. Reinvented.

Instant Insight
in memory-enabled
Intuitive User Experience
all devices
”
Flexible and Non-disruptive
cloud or on-premise

Financial Planning Accounting and Treasury and Finance Enterprise Risk

and Analysis Financial Close Financial Risk Operations and Compliance

Source: SAP
19
Multiple Sources of Truth in Financials Before SAP S/4HANA
Finance

Challenges:
• The combined content of several tables
represents “the truth.” Reconciliation efforts are
enforced by design.
• Need “to move” data to the appropriate table for
reporting (e.g., “settlement”)
• Different level of detail stored in the respective
components/tables
• Components are structured differently (e.g.,
fields/entities differ)
• Different capabilities in the components
(customer fields, currencies, multi-GAAP, etc.)
• Multiple BI extractors needed to cover the
complete truth in BI

20
The New Architecture with SAP S/4HANA Finance: Universal
Journal as the Single Source of Truth
The new architecture
• Motto: “Take the best of all worlds” (e.g.,
ledger, market segment, coding block, etc.)
• Secondary cost elements are G/L accounts
• One line item table with full detail for all
components
• Data stored only once: no reconciliation needed
by architecture
• Reduction of memory footprint through
elimination of redundancy
• Fast multi-dimensional reporting on the
Universal Journal possible without replicating
data to BI
• If BI is in place anyway, only one single BI
extractor needed (instead of many today)
• Technical preparation done to enhance
important structural capabilities of the
Financials solution (e.g., multi-GAAP, additional
currencies)

21
The New Journal Entry (Header and Item)
• The new journal entry consists of a header (table BKPF)
and the respective items (table ACDOCA)
BKPF
 There are rare cases, where entries in ACDOCA are
written without a document header (e.g., carry forward,
corrections in migration). These entries do not represent
standard business processes.
 The corresponding line items have “artificial document
ACDOCA
numbers” beginning with letters (e.g., “A”)
• Table ACDOCA contains all fields needed for G/L, CO, AA,
ML, PA
• Multi-GAAP capability through “RLDNR” dimension
• 6-digit field for line item numbering
• 23 digits for currency fields

22
Merge of Account/Cost Element in Chart of Accounts

GL Account
Account Types:
Balance Sheet
 X: Balance Sheet
Accounts
 N: Non-operating expenses/revenues
Non-Operating  P: Primary costs/revenues
Expense/Revenues  S: Secondary cost elements
Primary Cost
Elements

Secondary Cost
Elements

23
SAP S/4HANA Finance: Accounts and Cost Objects

Real-World Event
Direct
postings
90100
Cost Center

Account View of General Ledger Accountability View by Cost Object

Balance Sheet
A/P
211000
800

Profit and Loss/Primary Cost Elements

Salary Cost Center
Expenses 900100
610000 800
800
24
Result: Trial Balance with Cost Center Drilldown

25
SAP S/4HANA Finance: Allocations

Period-Close Profit. Segment

Profit. Segment
Process Profit. Segment
90100 Profit. Segment
Cost Center Product Group
Allocations A
from
cost centers

Accountability by Cost Object

Cost
Center
Profit and Loss 90100
800
Assessments Profitability Profitability Profitability Profitability
416000 Segment Segment Segment Segment
XXXXXX XXXXXX XXXXXX XXXXXX
800
200 200 200 200
800

26
Result: Trial Balance Including Secondary Cost Elements

Replaces reconciliation ledger (KALC) and real-time integration in new GL!

27
What We’ll Cover

• Reconciling CO-PA with the General Ledger

• Implementing Parallel Accounting
• Using Cost Component Split Functionality
• Profit Center and Segment Reorganization
• Creating Drilldown Reports for Multi-Dimensional Analysis
• Utilizing Summarized Hierarchies to Aggregate Product Costs
• Wrap-Up

28
Using Parallel Ledgers in the SAP General Ledger

• With SAP General Ledger, you can perform parallel accounting by running several
parallel ledgers for different accounting principles
• You can post data to all ledgers, to a specified selection of ledgers, or to a single ledger
• The leading ledger is integrated with all subsidiary ledgers and is updated in all
company codes
• You need to create an additional non-leading ledger for each parallel accounting principle

29
Setting Up Parallel Ledgers

• The leading ledger is activated at the client level

• All non-leading ledgers have to be activated at company code level
• Additional non-leading ledger can be used if the company wants to use different fiscal
year variants
• Closing activities are run separately in parallel ledger
• The leading area of Asset Accounting (Area 01) must be posted to the leading ledger

30
SAP Components That Can Post to Parallel Ledgers

Financial • Foreign Currency Valuation

Accounting • Value Adjustments

• Depreciation Areas
Asset Accounting • Posting APC Differences

• Financial Assets
Treasury • Financial Products

• Allocations
Controlling • Results Analysis

Materials • Balance Sheet Valuation

Management • Alternative Valuation Run
31
Setting Up Valuation Areas for Parallel Valuation

Source: SAP
32
Setting Up Depreciation Areas for Parallel Valuation

Assign the main depreciation area

to the leading ledger

Assign the parallel depreciation

area to a non-leading ledger

Create a delta depreciation area to

post the difference

Complete the setup

33
Setting Up Depreciation Areas for Parallel Valuation (cont.)

• Go to the IMG menu path: Financial Accounting (New)  Asset Accounting  Valuation
 Depreciation Areas  Set Up Areas for Parallel Valuation

The system displays the

parallel valuation wizard

34
Assigning the Master Area to a Ledger Group

• Here you assign the main depreciation area to the leading ledger

35
Entering the Area for Parallel Valuation

• Here you enter the depreciation area for parallel valuation

36
Entering the Delta Area

• Here you assign the delta area to the parallel ledger group

37
Overview of Parallel Valuation Settings

The final stage of the

wizard shows the
book depreciation
area along with the
parallel and delta
areas

38
Activating the Depreciation Area in Asset Classes

• When the parallel depreciation area is created, it is not automatically activated in the
asset classes
 You can do so by going to the following IMG menu path: Financial Accounting (New) 
Asset Accounting  Valuation  Determine Depreciation Areas in the Asset Class

Remove the
Deactivation
indicator from the
depreciation area
39
Activating New Depreciation Area for Existing Assets

• Go to transaction AFBN

• This transaction updates all existing assets with the new depreciation area
 It does not update any existing assets under construction

40
Activating New Depreciation Area for AuCs

• Implement SAP Note 317806 in your system

 This creates custom program ZZAFANEW1, which you can execute using
transaction SA38/SE38

41
New Asset Accounting in SAP S/4HANA Finance (Formerly SAP
Simple Finance)
• Flexibility concerning “Leading Valuation”
 No more hard coupling of depreciation area 01
• Only one Depreciation Area per Valuation necessary
 No further depreciation areas (Delta areas) necessary to portray a parallel valuation
• Real-time postings per accounting principle/valuation
 Common understanding of posted document

 Posting to different periods possible (restriction: beginning/end of FY need to be equal)

• No restrictions to set up different account determinations in different valuations
• New transactions for accounting principle (depreciation area) specific documents
• Always separate documents per accounting principle (FI-AA)
 Post the values correctly right from the beginning, using multiple parallel documents
• Smooth integration with Parallel Valuation of Cost of Goods Manufactured (COGM)
 Parallel valuation of acquisition values immediately with the activation of an Asset under
Construction (AuC)

42
Integrated Acquisition with Ledger Approach to Parallel Valuation
(Different Amounts to Be Capitalized Due to Accounting Principle)

Asset Reconciliation IFRS

AP Reconciliation Tech.Clear.Acc.Acqu. Freight expenses
1) 10.200 1) 10.200 2a) 10.200 2a) 10.200

Asset Reconciliation LGAAP

1) 10.200 1) 10.200 2b) 10.200 2b) 10.200 3) 200 3) 200

Transaction vendor invoice

1) ‘“Technical Clearing Account Acquisition’ to Vendor” LG Blank
2a) “Asset to ‘Technical Clearing Account Acquisition’” LG IFRS • Technical account balances to zero
2b) “Asset to ‘Technical Clearing Account Acquisition’” LG LGAAP • Accounting Principle specific
Transaction correction freight cost documents
3) “Freight expenses to Asset” LG LGAAP • Using different reconciliation account
per accounting principle is possible

43
FI-AA (New): Assets Activated in Only Some (But Not All)
Accounting Principles
• In the new architecture:
 Only relevant accounting principles need to be represented on the asset (or on the
asset class) by their corresponding depreciation areas
 All postings issued within FI-AA will only affect those accounting principles which are
relevant for the involved asset(s)
 P&L postings for all other accounting principles have to be handled manually by the

end user

44
What We’ll Cover

• Reconciling CO-PA with the General Ledger

• Implementing Parallel Accounting
• Using Cost Component Split Functionality
• Profit Center and Segment Reorganization
• Creating Drilldown Reports for Multi-Dimensional Analysis
• Utilizing Summarized Hierarchies to Aggregate Product Costs
• Wrap-Up

45
Cost Component Structure

Cost Components group together

costs of similar types

They are mapped to cost elements

which are part of a material’s cost

Common examples are Materials,

Labor, and Overhead

They are created in transaction OKTZ

46
Cost Components

• Cost components are set up to break out the standard cost into its respective elements
• Cost elements are assigned to these cost components
• These cost components are assigned to value fields

47
Uses of Cost Components

• Analyzing the cost origin across multiple production levels and assigning Cost elements
to these cost components
• Ability to view the costs by the original production factors, known as the primary cost
component split
• Structuring the costs according to the requirements of other areas, such as material
valuation or profitability analysis

Source: SAP
48
Initialization of Actual Cost Component Split

• Material Ledger’s Periodic Unit Price can also be split according to relevant
cost components

Raw materials
• Initialized by executing program
MLCCS_STARTUP in transaction SE38 Packing Materials

Overhead
• All materials with price determination Salaries
“3” get an initial cost component split
by standard price Depreciation

COST COMPONENTS

49
Transferring Data to Profitability Analysis

Define a valuation Create costing keys for Assign point of valuation

strategy for actual periodic and alternative 02 to costing keys and
costing and assign it to costing runs based on material types FERT,
point of valuation 02 specific valuation view HALB, etc.
(KE4U) (SPRO) (KE4J)

Assign point of valuation Perform periodic

02 to cost component valuation of costing
structure and COPA results with units sold
value fields in a period
(KE4R) (KE27)

50
Defining a Valuation Strategy

• Determines how value fields are updated in profitability analysis

• Methods for using Valuation Strategies are as follows:
 CO-PA Condition Types

 Transfer Prices

 User Exits

 Material Cost Estimates

• Valuation using Material Cost Estimates valuates the cost of sales of products sold from
billing documents that are transferred to CO-PA

You need to specify which CO-PA quantity field will be used by

the valuation strategy

51
Points of Valuation

• Identify how application functions are transferred to CO-PA

• Types of Points of Valuation are as follows:

• Point of Valuation “02” is used for updating CO-PA data with material ledger
• The combination of Point of Valuation “02” and record Type “F” (for billing documents) is
assigned to the Valuation Strategy for Actual Costing

52
Defining Costing Keys

• Costing Key determines which actual cost is to be applied to the CO-PA quantity field in
the valuation strategy

• By specifying a valuation view you can control whether the system uses the legal, group,
or profit center valuation’s actual cost
 This is how you can use different actual costs based on different GAAP methods such
as US GAAP and IFRS
53
Defining Costing Keys (cont.)

• You assign the costing key to the actual cost of sales value field that you want to update
• If you have different actual costs for different valuation methods then you need to create
multiple costing keys and assign them to different value fields

• The IMG menu path for this setting is as follows:

Controlling  Profitability Analysis  Master Data  Valuation  Set

up Valuation Using Material Cost Estimate  Define Access to Actual
Costing/Material Ledger

54
Assigning Costing Keys

Assign Costing Keys to

Products

Assign Costing Keys to

Material Types

Assign Costing Keys to

Characteristics

• Up to three costing keys can be assigned to each of the steps above

• Each step overrides the other in the sequence displayed

55
Periodic Valuation

Record type indicates

that you are applying the
cost to posted billing
documents

Periodic Valuation
indicator will set the
valuation date as the
billing document date

• Should be executed after your actual costing and alternative

valuation runs have been done at period-end
56
SAP S/4HANA Finance: Detailing of Cost of Goods Sold Accounts

• New Configuration for Cost of Goods Sold Postings

• Create sub accounts per cost component

57
SAP S/4HANA Finance: Split of Cost of Goods Sold Based on
Weighting of Standard Cost Components
• Delivery Document (quantity x price) posted as normal
• Cost Estimate for material selected
• New accounts updated in accordance with split

• CO document includes fix/variable split

58
What We’ll Cover

• Reconciling CO-PA with the General Ledger

• Implementing Parallel Accounting
• Using Cost Component Split Functionality
• Profit Center and Segment Reorganization
• Creating Drilldown Reports for Multi-Dimensional Analysis
• Utilizing Summarized Hierarchies to Aggregate Product Costs
• Wrap-Up

59
SAP Reorganization Plan Provides a Unique and Complete View of
the Reorganization Process
Plant Manager

Sales Manager
Central Controller Accountant
Corporate Management (CEO) Central Controller Cost Accountant

Management
Defines Monitors Status,
Decision:
Corporate
Reorganization * Reorganization
Plan
Make Detailed
Decisions
Triggers
Automated Steps
Report Results
*
Customer business challenges Business Value
• Break down a management decision to • Provides a single point of entry for
reorganize into a well-defined reorganization defining, triggering, monitoring, and
plan reporting on a reorganization plan
• Align all related parties, identify their specific
responsibilities; initiate and monitor all
necessary activities
• Provide the database for audit trail
60
Reorganization Plan — Detail

• Reorganization uses a reorganization plan

to provide a central framework for the
reorganization
• The reorganization plan describes what profit
centers are to be reorganized
• It then takes account of the derivation logic in
Profit Center Accounting to determine which
objects are affected by the reorganization
• It provides executable programs that select and
update the new profit center assignment
together with detailed logs of the steps
performed

61
System Prerequisites for a Reorganization

You have assigned the Profit Center Update scenario to the

relevant ledgers

In cases requiring a balance to be corrected in a specific ledger,

at least one document is created for each ledger

The objects to be reorganized already have a profit center

assignment

If you want to reorganize the GR/IR clearing account as well as

receivables and payables, you need to have document splitting

62
System Prerequisites for a Reorganization (cont.)

• If you want to reorganize fixed assets, the following prerequisites must be met:
 You have activated segment reporting for fixed assets in Customizing for
Asset Accounting
 You have activated the account assignment objects Profit Center and Segment

 You have set the Acct Assignment Object Same in Asset Master and Posting indicator
for both the profit center and the segment
 You have filled the master data for segment reporting in Customizing for
Asset Accounting

63
Organizational Prerequisites for a Reorganization

• The reorganization date is always the first day of the posting period of the leading ledger
• There can only be one profit center reorganization per reorganization date and per
controlling area
• Before you can start the reassignment and the transfers, the closing operations of the
previous period need to have been completed

64
Organizational Prerequisites for a Reorganization (cont.)

• Before you start the reassignment, the posting periods preceding the reorganization
period must be closed
• During the transfer, postings must not be made to objects included in the reorganization
• You cannot make any future postings and settlements that fall after the scheduled
reorganization date

Specify a date that falls in the future as the reorganization date!

65
Activate Business Functions for Reorganization

• Go to the transaction SFW5

 Activate the following business functions:

66
Activate Reorganization Plan Type

• SPRO  Financial Accounting (New)  General Ledger Accounting (New) 

Reorganization  Basic Settings  Activate Reorganization Plan Type

• Once you activate the Profit Center plan type, it can then be used in other
Customizing activities

67
Define Reorganization Document Type

• SPRO  Financial Accounting (New)  General Ledger Accounting (New) 

Reorganization  Basic Settings  Define Reorganization Document Type

• Specify the document type used in the reorganization for transferring balances and
assign it to the Plan Type
 It is advisable to use a document type that is not currently used for transaction
postings

68
Define Transaction Types for Transfer Postings

• SPRO  Financial Accounting (New)  General Ledger Accounting (New) 

Reorganization  Basic Settings  Define Transaction Types for
Reorganization Transfer Postings

• Specify the consolidation transaction type for acquisition and retirement and assign it to
the Plan Type
 These transaction types should be set up in the “Preparation for Consolidation”
configuration settings

69
Specifying Restriction Characteristics for Plan Type

• SPRO  Financial Accounting (New)  General Ledger Accounting (New) 

Reorganization  Basic Settings  Restriction Characteristics  Specify
Restriction Characteristics for Reorganization Plan Type

• This is used to restrict the characteristics used in a reorganization plan

 Specify which restriction characteristics are available in the General Restrictions tab
page for the definition of a reorganization plan

70
Specifying Restriction Characteristics for Object Type

• SPRO  Financial Accounting (New)  General Ledger Accounting (New) 

Reorganization  Basic Settings  Restriction Characteristics  Specify
Restriction Characteristics for Reorganization Object Type

• This is used to restrict the characteristics used in a reorganization plan

 Specify which restriction characteristics are available in the Specific Restrictions tab
page for the definition of a reorganization plan

71
Specific Settings of Profit Center Reorganization

• Specify Periods for Sales Document Selection

Sales
Documents

• Exclude Results Analysis Categories for Determining

Work in Balances of Cost Objects
Process

• Activate Reorganization of Fixed Assets

Fixed • Check Profit Center Assignment in Asset Master Records
Assets

72
Create Reorganization Plan

• Go to transaction FAGL_RPLAN Enter the

Reorganization Plan
name and description

Enter the
Reorganization Date
as the first date of a
future period

The reorganization Plan can be accessed and processed via

the SAP Business Client or SAP Enterprise Portal

73
Create Reorganization Plan (cont.)

• Click on the “Restrictions” tab

• Enter the Controlling Area, Company Code, and other characteristics (if necessary) to
restrict the selection criteria for objects that you wish to reorganize

74
Create Reorganization Plan (cont.)

• Click on the “Packages” tab

• Enter a Reorganization Package and a Package Name and assign it to a Package Type

In the ERP system, the only Package Type that exists is

“Material/Plant”

75
Change Reorganization Package

• Go to transaction FAGL_RPACK
Enter the
Reorganization Plan and
the Reorganization
Package

76
Change Reorganization Package (cont.)

• Click on the “Restrictions” tab

Enter the Company

Code and the Profit
Center(s) to be
changed

77
Generate Object List

• Click on the “Objects” tab

• Click on the button

All Materials with

the profit centers
specified are
displayed

78
Update Account Assignments for Reorganization Plan

• You can change all the selected objects to the new profit center by clicking on
and choosing the “Select All” option
• Then click on and choose the “Set New Account Assignment” option
• Then enter the new profit center in the ensuing pop-up box

79
Update Account Assignments for Reorganization Plan (cont.)

• The new profit center is then updated for all the objects selected

You can also enter a different profit center in each line of the
selected objects

80
Classifying Objects as Relevant

• Click on the button again and choose the “Classify as Relevant” option

• All objects will now be classified as “Relevant”

81
Setting Reorganization Status as Complete

• Click on the button

• You will get the below message in a pop-up box

• Click on the button to get the message below

82
Creating a Snapshot of a Reorganization Plan

• By creating a snapshot, the system determines the current inventory for all material-plant
combinations of the package that are to be reorganized and saves this data
 Enter the reorganization Plan and Reorganization Package and Execute the transaction

You can do this using Transaction FAGL_RPACK

83
Changing the Account Assignment

• You can change the account assignments for a package of a reorganization plan
 The system changes the profit center for all material-plant combinations classified
as relevant

You can do this using Transaction FAGL_RREASSIGN_MD

84
Transferring the Balances of a Reorganization Package

• You can perform transfer postings for a package of a reorganization plan

 The system performs the transfer from the source profit center to the target profit
center for all objects in the package

You can do this using Transaction FAGL_RREASSIGN_MD

85
What We’ll Cover

• Reconciling CO-PA with the General Ledger

• Implementing Parallel Accounting
• Using Cost Component Split Functionality
• Profit Center and Segment Reorganization
• Creating Drilldown Reports for Multi-Dimensional Analysis
• Utilizing Summarized Hierarchies to Aggregate Product Costs
• Wrap-Up

86
Reasons for Drilldown Reports in SAP General Ledger

• SAP General Ledger has various dimensions that can be reported on, such as profit
center, segment, functional area, etc.
• It has a “cube-like” structure similar to CO-PA as it contains several mini-ledgers (called
scenarios) in one main ledger
• You therefore need a report that is flexible enough to sort by different characteristics, and
combinations of characteristics (e.g., by G/L accounts and profit centers)
• Classical reports do not have the functionality for multi-dimensional reporting

87
Creating a Drilldown Report

• The first step is to create a form, which defines the layout of the report, such as the key
figures for the rows and columns
• You can also include
additional characteristics in
each row and column which
will distinguish the values
reported by certain categories
such as “plan vs. actual,”
“Month1 vs Month2,” etc.

Source: SAP
88
Creating a Drilldown Report (cont.)

• To define a form for an SAP General Ledger drilldown report, you need to go to the
following configuration menu path:
 Financial Accounting (New)  General Ledger Accounting (New)  Information
System  Drilldown Reports (G/L Account)  Form  Specify Form

• To define a SAP General Ledger drilldown report, you need to go to the following
configuration menu path:
 Financial Accounting (New)  General Ledger Accounting (New)  Information
System  Drilldown Reports (G/L Account)  Report  Define Report

89
Creating a Drilldown Report (cont.)
Enter the form that you Make sure that you select
want the report to be the report type based on
based on the SAP General Ledger
totals table “FAGLFLKEXT”

It is much easier to copy a form/report that already exists and

modify it than create one from scratch

90
Using Drilldown Reports

• With drilldown reports you can choose

to display the data by different
dimensions, which are shown in the
“Navigation” section of the screen
• Simply click on the relevant
characteristic so that it is displayed on
the right of the screen

91
Viewing and Using a List of Drilldown Reports

• You can display the list of SAP General Ledger reports that you want to execute by going
to transaction FGI0
• You can give this transaction
to the relevant users or
create a custom transaction
for each report (by using
transaction SE93)

92
Drilldowns Using Virtual Info Providers

ETL

Transact
Analyze

ERP Table Structures Virtual InfoProvider UI: Analysis for Microsoft Office
Report via:
CE1 table (transactions) (Create using BW Query
CE4 table (dimensions) transaction KEIP)

93
SAP S/4HANA Finance: Income Statement with Drilldown

94
Income Statement with Drilldown to Cost Center

95
Income Statement with Drilldown to Material Group

96
What We’ll Cover

• Reconciling CO-PA with the General Ledger

• Implementing Parallel Accounting
• Using Cost Component Split Functionality
• Profit Center and Segment Reorganization
• Creating Drilldown Reports for Multi-Dimensional Analysis
• Utilizing Summarized Hierarchies to Aggregate Product Costs
• Wrap-Up

97
Types of Summarized Analysis Reports

• Product Drilldown reports

 Configuration

 Product groups

 Data collection

 Run reports

• Summarization hierarchy reports

 Configuration

 Selection status profile

 Data collection

 Run reports

 Alternate summarization hierarchies

98
Product Drilldown Reports

• Product Drilldown reports allow you to slice and dice data based on characteristics,
such as:
 Product group

 Material

 Plant

 Cost component

 Period

• You can easily navigate between characteristics and drill down to lower-level
characteristics
• Use predefined summarization levels
 You don’t have to define summarization levels

 Predefined summarization levels work for most companies

99
Product Drilldown Reports: Configuration

• You can run Product Drilldown reports without configuration

 Its only purpose is to utilize one of the following groups:

 1 Product Hierarchy

 2 Material Group

 3 CO Product Group

• Transaction OKY0
 IMG

 Controlling

 Product Cost Controlling

 Cost Object Controlling

 Information System

 Control Parameters
100
Product Drilldown Reports: Product Groups

• CO product groups allow you to define your own hierarchy

 You can assign materials to your hierarchy

 Easiest to use existing material groups and

product hierarchy
• Transaction KKC7
 Accounting  Controlling
 Product Cost Controlling
 Cost Object Controlling
 Product Cost by Period
 Information System  Tools
 Summarized Analysis: Preparation
Product Group  Create
101
Product Drilldown Reports: Data Collection

• You populate the Product Drilldown dataset during data collection

• Transaction KKRV
Accounting  Controlling
Product Cost Controlling
Cost Object Controlling
Product Cost by Period
Information System  Tools
Data Collection
For Product Drilldown
• You normally run data collection following period-end closing for the current and
previous period
 Since data can change within open financial periods
102
Product Drilldown Reports: Run Reports

• Following data collection you run Product Drilldown reports

• Transaction S_ALR_87013139
Accounting  Controlling
Product Cost Controlling
Cost Object Controlling
Product Cost by Period
Information System
Reports for Product Cost by Period
Summarized Analysis
With Product Drilldown
Variance Analysis
Target, Actual, Production Variances
103
Product Drilldown Reports: Report Analysis

• Each line represents a material

• Variance column below is sorted in descending order
• Provides visibility to materials with largest accumulated variance
• Drill down on any line to find more details by:
 Period/year

 Cost component

• You can analyze variance per material further by displaying details of the manufacturing
order with Transaction KKBC_PKO

104
Summarization Hierarchy Report

• Summarization hierarchies allow you flexibility in displaying data

 A summarization hierarchy groups together manufacturing orders at the lowest-level
summarization nodes
 The nodes are in turn grouped together at higher-level nodes

 Creates a pyramid structure

• Each summarization level is set up manually in configuration

 Hierarchy levels are expandable and collapsible rows in reports

• Example of hierarchy levels starting at top of pyramid:

 Controlling area

 Profit center

 Plant

 Material group
105
Summarization Hierarchy Report: Configuration — Object Types
• Transaction KKR0
 IMG  Controlling  Product Cost Controlling  Information System  Cost Object
Controlling  Settings for Summarized Analysis/Order Selection  Maintain
Summarization Hierarchy

• Select an existing hierarchy and double-click Data Scope

106
Summarization Hierarchy Report: Configuration — Hierarchy
Levels
• You specify which object types are summarized in the hierarchy
 The Description in the selected row indicates the object types

• Double-click Hierarchy levels to display hierarchy level details

 The system requires Controlling Area as the top hierarchy level

107
Summarization Hierarchy Report: Selection Status Profile

• Transaction BS42
 IMG  Controlling  Product Cost Controlling  Information System  Cost Object
Controlling  Settings for Summarized Analysis/Order Selection  Define Status
Selection Profiles

• This screen shows the existing selection profiles and allows you to define new
selection profiles
• Selection status profiles allow you to select orders based on order status
108
Summarization Hierarchy Report: Selection Status Profile (cont.)

• Select an existing selection profile, and double-click on Selection conditions on the left to
display profile details

• This example results in the selection of orders with a status of:

 Confirmed

 Delivered

 Not technically completed

109
Summarization Hierarchy Report: Data Collection

• You populate the summarization hierarchy dataset: data collection

• Transaction KKRC
Accounting  Controlling
Product Cost Controlling
Cost Object Controlling
Product Cost by Period
Information System  Tools
Data Collection
For Summarization Hierarchy
• You normally run data collection following period-end closing for the current and
previous period
 Since data can change within open financial periods
110
Summarization Hierarchy Report: Run Report
• Following data collection you run summarization reports
• Transaction KKBC_HOE
 Accounting  Controlling
 Product Cost Controlling
 Cost Object Controlling
 Product Cost by Order
 Information System
 Reports for Product Cost by Order
 Summarized Analysis
 With Defined Summarization Hierarchy
• You can run the report with:
 Cumulated period range to display all costs

 Limited period range to improve performance

111
Summarization Hierarchy Report: Report Analysis

• The hierarchy levels we defined in configuration are displayed:

 Plant (0021), Order type (RM01 and ZP01)

• To display Target, Actual, and Variance columns, choose:

 Settings  Layout  Choose

 Actual debit for all orders of order type is 3,317.24

112
Summarization Hierarchy Report: Single Objects

• To see details of orders reporting to node RM01 click the node

 Choose from the menu bar: Goto  Single Objects

• Variance column is sorted in descending order

 This provides visibility to orders with large variances

An advantage of the single objects report is that it is presented in the

user-friendly ALV (ABAP list viewer) format, which allows you to easily
sort, sum, and filter values, as well as rearrange columns
113
Summarization Hierarchy Report: Alternate Summarization
Hierarchies
• Summarization reporting allows you to create multiple hierarchies
• Previously, we chose plant and order type as hierarchy levels
 You can create hierarchies with an additional level of order and see the details directly
in the results screen
 Long runtimes can occur if order number is set as a hierarchy level

114
SAP S/4HANA Finance: Order and Project Hierarchies Aggregated
on the Fly

Summarization
Define characteristics for
aggregation as before
(Transaction KKR0)

No need to run data

collection run to create
summarization objects

Simply select your

hierarchy or hierarchy
node and analyze the
aggregated values
115
What We’ll Cover

• Reconciling CO-PA with the General Ledger

• Implementing Parallel Accounting
• Using Cost Component Split Functionality
• Profit Center and Segment Reorganization
• Creating Drilldown Reports for Multi-Dimensional Analysis
• Utilizing Summarized Hierarchies to Aggregate Product Costs
• Wrap-Up

116
Where to Find More Information

• Paul Ovigele, 100 Things You Should Know About Financial Accounting
with SAP (Quincy, MA: SAP PRESS, 2011).
 Provides little-known tips to optimize the Financial Accounting module

• ovigele.com/blog/
 Contains tips and tricks on how to optimize the Controlling Module

• John Jordan, Product Cost Controlling with SAP, Second Edition (Quincy, MA: SAP
PRESS, 2012).
 ISBN-10: 1-59229-399-5 (978-1-59229-399-5)

 www.sap-press.com/products/Product-Cost-Controlling-with-SAP-%282nd-
Edition%29.html

117
Where to Find More Information (cont.)

• Paul Ovigele, Reconciling SAP CO-PA to the General Ledger (Espresso Tutorials, 2014).
 www.espresso-tutorials.com/?page_id=99

 Provides little-known tips to reconcile CO-PA to the General Ledger

118
Where to Find More Information (cont.)

• Janet Salmon, “Controlling with SAP – Practical Guide” (2014).

ISBN 978-1-4932-1012-1
 www.sap-press.com/controlling-with-sap-practical-guide_3625/

 Provides general information on Controlling processes

• Janet Salmon and Ulrich Schlüter, SAP HANA for ERP Financials, Second Edition
(CreateSpace Independent Publishing Platform, 2014).
 www.amazon.com/SAP-HANA-ERP-Financials-2nd-ebook/dp/B00OJDJHMQ/
ref=sr_1_1?ie=UTF8&qid=1419240780&sr=8-1&keywords=janet+salmon
 Explains how SAP HANA works in the context of Finance

119
Where to Find More Information (cont.)

• Jens Krüger, SAP Simple Finance (Quincy, MA: SAP PRESS, 2015).
 www.sap-press.com/sap-simple-finance_3793/

 Introduces SAP’s new flagship product

120
Where to Find More Information — Key SAP Notes for SAP
S/4HANA Finance (Formerly SAP Simple Finance)
• Release Information Note: 2117481 *
• Released Processes, Enterprise Extensions, Industry Solutions!: 2119188 *
• Released SAP Add-Ons: 2103558 *
• Released Partner Add-Ons: 2100133 *
• Availability of Country Versions: 2153644 *
• Release Restrictions: 2127080 *

* Requires login credentials to the SAP Service Marketplace

121
Where to Find More Information
• Janet Salmon, “Profit Center Reorganization Is a Snap with New Functions in Enhancement Package 5”
(Financials Expert, August 2009).
 http://sapexperts.wispubs.com/Financials/Articles/Profit-Center-Reorganization-Is-a-Snap-with-New-
Functions-in-Enhancement-Package-5?id=FB05F764BE994329AFEC7E436B50639B#.VMJ69kfF-y4

• Janet Salmon, “SAP Simple Finance: New Options in Profitability Analysis” (Financials Expert,
December 2014).
 http://sapexperts.wispubs.com/Financials/Articles/SAP-Simple-Finance-New-Options-in-Profitability-
Analysis?id=E50C2DC3AB7F49338918823FCD43E871#.VK_UwyvF-y4

• Janet Salmon, “SAP Simple Finance: What Happened to the Cost Elements?” (Financials Expert,
October 2015).
 http://sapexperts.wispubs.com/Financials/Articles/SAP-Simple-Finance-What-Happened-to-the-Cost-
Elements?id=85A791FA17CC47E89EFE90628B8908F2#.VpO0evkrKM8

122
Additional Sessions to Consider Attending

• SAP S/4HANA Finance: Map out your project and build a business case that maximizes
ROI by David Dixon, TruQua Enterprises
• Making it all work: A deep dive into the central finance deployment option
by David Dixon, TruQua Enterprises
• Calculating actual costs, transfer prices, and parallel valuations with material ledger
by Paul Ovigele, ERPfixers

123
7 Key Points to Take Home

• You can configure a “Shipped not Billed” scenario in order to deal with the timing issue
between the cost of sales account in the general ledger and CO-PA
• You can perform parallel accounting by running several parallel ledgers for different
accounting principles
• If your profit center structure changes, you can adjust your data
• SAP General Ledger has various dimensions that can be reported on using
drilldown reporting
• Summarization and production order reports allow you to analyze production data
collectively for plants
• SAP is revisiting the account-based CO-PA approach within SAP S/4HANA Finance
• SAP S/4HANA Finance provides new multi-dimensional reporting based on a new data
structure for the journal entry
124
Your Turn!

How to contact us:

Paul Ovigele
Email: povigele@erpfixers.com
Twitter: @erpfixers

Janet Salmon
Email: janet.dorothy.salmon@sap.com

Please remember to complete your session evaluation

125
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126
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