Browse the BookIn this chapter, you’ll explore group currency and valuation with the Ma-terial Ledger in SAP S/4HANA. You’ll learn how to set up group currency, calculate a standard cost using group valuation, configure cross-compa-ny purchasing, and more.
Paul Ovigele
Material Ledger in SAP S/4HANA:Functionality and Configuration540 Pages, 2019, $89.95 ISBN 978-1-4932-1825-7
www.sap-press.com/4863
First-hand knowledge.
“Group Currency and Valuation”
Table of Contents
Index
The Authors
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3
Chapter 3
Group Currency and Valuation
Group currency translates material costs for a group into a unified cur-
rency. Group valuation allows for the exclusion of intercompany prof-
its from transactions that occur between affiliated companies.
In this chapter, we’ll discuss group currency, group valuation, and how they can be
set up and used. The terms group currency and group valuation are usually concate-
nated to become group currency/group valuation, as we mentioned a few times in
the previous chapter. However, many companies that use group currency don’t use
group valuation because many companies that used group currency in SAP ERP may
not have used the Material Ledger. Now that the Material Ledger is mandatory with
SAP S/4HANA, they may want to know how group currency works with the Material
Ledger, but not necessarily activate group valuation. Therefore, we want to treat the
two concepts separately to start with.
We’ll first look at how to set up group currency alone with the Material Ledger in Sec-
tion 3.1, and then we’ll show how group currency and group valuation can be used in
conjunction. We’ll then show how to calculate standard cost in the group valuation
view Section 3.2, including how to set up a costing variant with settings that are spe-
cific to group valuation, and configuring a delta cost component split. In Section 3.3,
we’ll demonstrate the configuration that is needed for cross-company purchasing,
and walk through a detailed scenario.
3.1 Group Currency
We mentioned in the previous chapter that group currency is the currency that is set
up for the client. This means that all company codes in the same client will have the
same group currency. We also said that it’s advisable to make the controlling area
currency the same as the group currency to smooth the integration between the con-
trolling (CO) and financial accounting (FI) functionalities. Even if you have the group
currency enabled in FI and CO, this doesn’t necessarily mean that it’s automatically
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available in the Material Ledger. In this section, we’ll first recap a few configuration
steps that were shown in Chapter 2, Section 2.1.1, to demonstrate how group currency
is set up in the Material Ledger for a specific company code. Then, we’ll walk through
some key transactions you can use with group currency.
3.1.1 Setting Up Group Currency for a Company Code
First, let’s look at the currency of the company code EU10. To do this, go to Transac-
tion OX02, and double-click Company Code EU10, as shown in Figure 3.1.
Figure 3.1 Currency for Company Code EU10
As you can see in Figure 3.1, Company Code EU10 has a Currency of EUR. Now view the
group currency that is set up for this company code by going to Transaction FINSC_
LEDGER, selecting Ledger 0L, and double-clicking the Company Code Settings for the
Ledger folder. You’ll arrive at the screen shown in Figure 3.2.
Figure 3.2 Currency Settings for Company Code EU10
As you can see in Figure 3.2, Company Code EU10 has two currency types: company
code currency (Local Curr. Type) 10 and group currency (Global Curr. Type) 30. You’ve
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already seen that the company code currency is EUR. Now you can see the group cur-
rency by double-clicking on the Currency Conversion Settings for Company folder
shown in Figure 3.2, which will take you to the screen shown in Figure 3.3.
Figure 3.3 Group Currency Settings for Company EU10
You can see in Figure 3.3 that the group Currency Type 30 with Currency USD is
enabled for Company Code EU10. This group currency is based on the Company Code
Currency as a Source currency type, and the Exch. Rate Type M (Standard translation
at average rate) is used to convert the company code currency to the group currency.
This conversion between the company code currency EUR and the group currency
(USD) is set up in the exchange rate tables in Transaction OB08, as shown in Figure
3.4.
Figure 3.4 Exchange Rate between EUR and USD
Here, the exchange rate between EUR and USD is 1 EUR to 1.25 USD.
Now take a look at the Material Ledger settings for any plants assigned to company
code EU10 by going to Transaction OMX3 and looking at the Material Ledger type
assigned to the plant in Company Code EU10 (see Figure 3.5).
Figure 3.5 The Material Ledger Type for Company Code EU10
As you can see in Figure 3.5, the plant (Valuation area) 101O, which is assigned to Com-
pany Code EU10, is assigned to Mat. ledger type 9300.
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To see the currency types that are assigned to this Material Ledger, go to Transaction
OMX2, select Mat. Ledger Type 9300, and double-click the Define individual charac-
teristics folder to view the data shown in Figure 3.6.
Figure 3.6 Currency Types for Material Ledger Type 9300
You can see in Figure 3.6 that the Mat. Ledger Type 9300 has two currency types
assigned to it: Company code currency (10) and Group currency (30). We showed how
this is done in Chapter 2, Section 2.1.2. Assign this Material Ledger type 9300 to the
plant (171O) in company code EU10 to enable the group currency in the Material Led-
ger for this company code.
To now see how the material master in this plant looks with the company code cur-
rency and group currency, go to Transaction MM03 and select the Accounting 1 view
for material HAWA-123 in plant 101O (see Figure 3.7).
Figure 3.7 Material Master in Company Code and Group Currency
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You can see in Figure 3.7 that the material HAWA-123 has a Company code currency of
1.00 EUR. This is translated into the group currency (USD) using the exchange rate
that we saw in Figure 3.4 of 1 EUR to 1.25 USD. Therefore, the Group currency for this
material is 1.25 USD.
Note: Standard vs. Per Unit Price
You’ll notice that there are two price fields shown in Figure 3.7: Standard Price and
Per. unit price. Because the price control (Prc. Ctrl) of this material is V, the Per. unit
price is the valuation price, and the Standard Price is statistical.
You’ll also notice that the currency types shown in the material master don’t specify
which valuation view is used. When this happens, it means that the currencies are at
legal valuation. You can therefore say that the material has a valuation approach of
company code currency/legal valuation and group currency/legal valuation. For con-
venience in this section, we’ll only mention the currency type, as it’s assumed that
the valuation view is legal, unless specified otherwise.
3.1.2 Changing Material Cost
Let’s now perform a few transactions for this material. The first transaction we’ll
show is the changing of the cost of this material. Because the material is valued at
moving average price (indicated by a price control of V in Figure 3.7), you can change
the material price using Transaction MR21, as shown in Figure 3.8.
Figure 3.8 Price Change for Material HAWA-123
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You enter the new price in the New price column. In Figure 3.8, the material price has
been changed from 1.00 EUR to 1.20 EUR.
Note that there are two tabs in the screen, which are EUR Co.Code and USD Group. If
you’ve used Transaction MR21 without the Material Ledger active, you may not be
familiar with these two tabs in this screen. They appear because the price change will
need to be done in both the company code currency (EUR) and the group currency
(USD). You can do this in one of the following ways:
� Click the USD Group tab, and directly enter the equivalent USD amount in New
Price field of that tab.
� Click the USD Group tab, highlight the line with the material, and click the Trans-
late Selected Objects button (highlighted in Figure 3.8). This will lead to the popup
box shown in Figure 3.9.
Figure 3.9 Translation of Currency Type during Price Change
You can see in Figure 3.9 that the system is proposing the translation from EUR Com-
pany code currency. It also gives the option of the type of price you want to change.
The Valuation Price is the price the inventory is valued at (the moving average price,
in the example), whereas the Statist. Price is the standard price. Click the Confirm
Entry button to save your changes.
Now you can go back to the Accounting 1 view for this material and see what has
changed, as shown in Figure 3.10.
You can see in Figure 3.10 that the Company code currency price has changed to 1.20
EUR, while the Group currency price has changed to 1.50 USD, which is the USD trans-
lation of the EUR amount at the exchange rate shown earlier in Figure 3.4.
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Figure 3.10 Material Master after Price Change
3.1.3 Making a Purchase
Now, you can make a purchase for this material to see how it affects the material mas-
ter and relevant reports. For a purchase of 1,000 pieces at a price of 1.80 EUR, the pur-
chase order is shown in Figure 3.11.
Figure 3.11 Purchase Order for Material HAWA-123
After performing a goods receipt for the purchase order, the Company code currency
and Group currency for material HAWA-123 will look like that in Figure 3.12.
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Figure 3.12 Material HAWA-123 after Purchasing 1000 PC
The material HAWA-123 now has a price of 1.80 EUR in Company code currency, which
was translated into 2.25 USD in Group currency, and a Total Stock value of 1,000 PC.
Let’s see what the posting looks like in the Universal Journal (table ACDOCA), as shown
in Figure 3.13.
Figure 3.13 Table ACDOCA Showing Company Code and Group Currency
You can see that the company code and group currencies are shown in table ACDOCA
for this material. In SAP ERP, these values will normally be viewed in the material val-
uation table MBEW, but in SAP S/4HANA, these values are shown in the Universal Jour-
nal. You’ll also be able to view the values in the SAP Fiori reports for inventory, such
as the Material Inventory Values – Balance Summary report, shown in Figure 3.14.
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Figure 3.14 SAP Fiori Report for Material HAWA-123
You can therefore see that for every inventory posting, you’ll be able to track both the
company code and group currency on a material level. Without the Material Ledger,
if you had group currency activated, you would have been able to see this informa-
tion on a general ledger (G/L) basis and not a material basis as well.
We’ll now take a look at the other valuation approach segment for group reporting,
which is group valuation.
3.2 Group Valuation
Group valuation creates a separate view that can be used to display the inventory
results of a group of affiliated companies as if they were a single entity. It’s not a
requirement that you activate group valuation in SAP S/4HANA, even if you’re a mul-
tinational organization. For example, if an organization has multiple entities, but the
transactions between entities occur at cost (meaning that no profit is being made
from the sale between entities), then there may not be a use for group valuation. It’s
simply an option that you can use if you want to view inventory data on a group basis
by eliminating any intercompany profit in inventory.
Group valuation should not be confused with consolidation. While consolidation
involves the reporting of financial statements of multiple companies as if they were
a single entity, group valuation does this on a more granular level, for each individual
material. Consolidation involves the elimination of more than just inventory profit,
such as the elimination of payables and receivables, elimination of intercompany
debt, and elimination of revenues and expenses. Group valuation information can be
used to feed the data that is needed for consolidation, but it’s unlikely that consolida-
tion data is used in group valuation.
Let’s begin by looking at one of the key determinants for group valuation: transfer
pricing. We’ll then explain how to calculate a standard cost with group valuation by
creating a costing variant for group valuation and activating cross company costing.
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We’ll discuss how to configure a delta cost component split and a special procure-
ment key for transfers between plants in different company codes. We’ll also show
how an intercompany markup is included in the standard cost by using an additive
cost and how this looks in a standard cost calculation.
3.2.1 Transfer Pricing with Group Valuation
With the advent of globalization, mergers, and acquisitions between companies in
different countries, many organizations operate in regions with varying fiscal
requirements. Therefore, organizations need to be aware of the legal and fiscal impli-
cations of establishing a price for buying and selling products in the affiliated entities
in these countries.
A key factor to having a smooth intercompany process is setting up a pricing struc-
ture that conforms with the requirements of all countries involved but also leads to a
sufficient redistribution of profit from countries in high tax jurisdictions to coun-
tries in low tax jurisdictions. Transfer pricing is the method of establishing this pric-
ing structure. Because the transfer price is usually set by the organization itself, as
opposed to an external supplier, it’s important for the organization to keep track of
the original cost of the product because this is what (when compared with the reve-
nue from an external sale) constitutes the real profit to the organization. Group val-
uation aids with the tracking of this original cost because it eliminates any of the
intercompany profit between the entities, which, while useful from an internal prof-
itability point of view, doesn’t contribute to the overall gross margin of the organiza-
tion.
Figure 3.15 shows a supply chain with transfer pricing relationships between affiliated
companies with legal and group valuation values. In this example, three companies
(A, B, and C) belong to the same group. Company A is a manufacturing entity that pro-
duced a product at a cost of $100. This product was then sold to Company B (a distri-
bution entity) at a transfer price of $110. Company B then sold the product to
Company C (a selling entity) at a transfer price of $150. You see that while the legal val-
uation shows the transfer price of the product that is sold from one entity to the next,
the group valuation still shows the original cost of $100. If company C sold the prod-
uct to an external customer for, say, $200, then the profit in company C will be $50
($200 – $150) based on legal valuation, but the profit to the group as a whole will be
$100 ($200 – $100). You can therefore see how you can report two different profits in
parallel depending on who the audience is.
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If you want to treat each company as an autonomous entity and report their profit
separately, then the legal valuation view will be used. If you want to report the overall
profit of the group, then the group valuation view will be used.
Figure 3.15 Internal Supply Chain with Legal and Group Valuation
3.2.2 Group Valuation with Standard Cost
Now let’s look at how you can create a standard cost estimate for group valuation,
which represents a cost that excludes the intercompany profit included in the trans-
fer price. Although this process isn’t mandatory, if you already calculate a standard
cost estimate (in the legal view), and you now have group valuation activated (as we
discussed in Chapter 2), you’ll also need to perform a standard cost calculation for the
group valuation view. The process for calculating a standard cost for group valuation
is called group costing. It’s basically a way of calculating a standard cost of materials
for the whole group, which can be used in parallel with the standard cost of the mate-
rials in a particular company. For a multinational organization, it may make sense for
the company code-specific standard cost estimate to be calculated by the specific
entity, while the group cost is calculated by the parent company.
Several configuration steps are required for this. Let’s walk through these steps and
then show the results of the cost estimate in both the legal and group views and how
they differ.
Costing Variant for Group Valuation
First, you need to define a costing variant for group valuation. A costing variant con-
trols all the settings for calculating a standard cost estimate. If you already use cost
estimates, then you probably already have one set up for the legal view (although,
without the Material Ledger, it may not be apparent that the costing variant is for a
Company C
• Legal: $150• Group: $100
Company B
• Legal: $110• Group: $100
Company A
• Legal: $100• Group: $100
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specific view). The standard costing variant for legal valuation is normally PPC1, but
some companies tend to define their own costing variant with a different name.
The costing variant has the following five components:
� Costing types
This specifies to which field in the material master the costing results are trans-
ferred.
� Valuation variants
This contains the parameters that are required for calculating the cost estimate.
� Date control
This controls the dates on which the quantity and valuation structure are created.
� Quantity structure control
This specifies how the system searches for valid alternative bills of material (BOM)
and routings.
� Transfer control and reference variants
This setting prevents the system from creating a new cost estimate for a material
when one already exists.
For group valuation purposes, you only need to create two of these components:
costing types and valuation variants. The other components can be the same as the
ones for the legal view.
Let’s start with creating a costing type for group valuation. The costing type specifies
which field in the material master the costing results will be transferred to. To con-
figure a costing type for group valuation, go to the configuration menu path Con-
trolling • Product Cost Controlling • Product Cost Planning • Material Estimate with
Quantity Structure • Costing Variant: Components • Define Costing Types or use
Transaction OKKI. In the subsequent screen, click the New Entries button to access
the screen shown in Figure 3.16.
Enter a value for Costing Type and a short description (in this example, Costing Type
G1 – Standard Cost (Group)). In the Price Update tab, choose a Price Update of Stan-
dard Price and a Valuation View of Group Valuation. This means that when the stan-
dard cost for group valuation is released, it will be stored in the Standard Price field of
the material master. Now, click the Misc. tab to open the screen shown in Figure 3.17.
Create a Calculation Base by selecting Cost of Goods Manufactured from the drop-
down. This means that any overhead will be calculated using the cost of goods man-
ufactured (COGM) value as a basis. The Partner Version shows the value-added chain
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for every stage of the internal procurement process. By defining a Partner Version,
you’re specifying which organizational unit represents a partner. Because you’re
doing group costing, use a Partner Version that has the organizational unit of Com-
pany Code.
Figure 3.16 Costing Type for Group Valuation
Figure 3.17 Misc. Tab of Group Costing Type
To create the partner version that you’ll assign to the costing type, click the Create
icon highlighted in Figure 3.17. The screen shown in Figure 3.18 appears.
Name your partner version, and select the Partner type. In this example, a Partner
Version is created called “Company Code,” and the Company Code checkbox is
selected in the Partner tab. This Partner Version is then assigned to the costing type
shown previously in Figure 3.17. Click the Save button to save the costing type.
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Figure 3.18 Partner Version for the Costing Type
Next, you’ll create a valuation variant for group valuation. The valuation variant con-
tains the parameters that are required to calculate the standard cost. To configure a
valuation variant for group valuation, go to configuration menu path Controlling •
Product Cost Controlling • Product Cost Planning • Material Estimate with Quantity
Structure • Costing Variant: Components • Define Valuation Variants or use Transac-
tion OKK4. In the subsequent screen, click the New Entries button to access the
screen shown in Figure 3.19.
Figure 3.19 Valuation Variant for Group Valuation
Here, you can create a name for your valuation variant (in this example, Z01 –
Planned Valuation: GRP). Copy all the settings from the valuation variant of the legal
view because you want most of the costing parameters of the legal and group view to
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be the same. The only thing that is different is that in the legal view, you want to be
able to include additive costs in the cost estimate (because the additive costs will rep-
resent the intercompany markup), whereas you don’t want to include additive costs
in the group view. Therefore, don’t select the Incl. Additive Costs checkbox.
There are several ways to add an intercompany markup to your cost estimate, such as
the following:
� Using an overhead costing sheet
� Using a condition type from a purchasing info record
� Using additive costs or a user exit
In the example we’ll show later in this section, you’ll use an additive cost to add the
intercompany markup. However, depending on which method you choose, you need
to make sure that the group valuation variant doesn’t include this setting because
you don’t want the intercompany markup to be included in the group valuation
view. Click the Save button to save your settings for the valuation variant.
Now that you’ve created a costing type and valuation variant for group valuation,
you’ll create costing variants for group valuation and add these components to it. To
do this, go to configuration menu Controlling • Product Cost Controlling • Product
Cost Planning • Material Estimate with Quantity Structure • Define Costing Variants
or use Transaction OKKN. In the subsequent screen, click the New Entries button to
go to the screen shown in Figure 3.20.
Figure 3.20 Defining the Group Costing Variant
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Here, you can provide a name for your costing variant (we’ve created Costing Variant
ZPC1 for group valuation). Assign the Costing Type to Standard Cost (Group) and the
Valuation Variant to Planned Valuation: GRP using the dropdowns. Select the Date
Control and Qty Struct. Control settings that are used for the legal valuation costing
variant. These settings already exist in the standard system, so we’ll adopt them.
However, if your group valuation cost has different Date Control and Qty Struct. Con-
trol settings, then you can create your own and change them accordingly. Click the
Save button to save this costing variant.
Activating Cross-Company Costing
In a transfer pricing scenario, it’s very likely that you transfer products between com-
pany codes. In that case, you’ll want to activate cross-company costing. This means
that the standard cost calculation can access information in more than one company
code. This activation is only done on the legal valuation view because the group val-
uation view already accesses costing information across company codes. In addition,
by activating cross-company costing, you can transfer the cost from the sending
company to the receiving company and, if relevant, add a markup in the receiving
company.
To activate cross-company costing, go to configuration menu path Controlling •
Product Cost Controlling • Product Cost Planning • Selected Functions in Material Cost-
ing • Activate Cross Company Costing or use Transaction OKYV. In the subsequent
screen, click the New Entries button to access the screen shown in Figure 3.21.
Figure 3.21 Activating Cross Company Costing
Select the Cost Across Company Codes checkbox to activate cross-company costing.
As you can see in Figure 3.21, cross-company costing has been activated in Controlling
Area A000 for the legal valuation Costing Type 01 and Valuation Variant 001. This
means that a product in one company code can access the cost of a lower-level prod-
uct in a separate company code. Click the Save button to save your settings.
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Configuring a Delta Cost Component
When you use transfer prices in group costing, you’ll most likely want to identify the
profit that is made between companies. This way, you can easily recognize the amount
of intercompany profit that is included in the cost of inventory of a company that
bought a product from an affiliate company. To achieve this, you’ll need to create a
delta cost component.
You create this cost component by going to configuration menu path Controlling •
Product Cost Controlling • Product Cost Planning • Basic Settings for Material Costing •
Define Cost Component Structure or using Transaction OKTZ. Click the cost compo-
nent structure Y1, and then double-click the Cost Component with Attributes folder.
Click New Entries to access the screen shown in Figure 3.22.
Figure 3.22 Delta Cost Component
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Create Cost Comp. 999 in Cost Comp. Str. Y1. This delta cost component will be avail-
able in the group valuation view in the standard cost component reports. Following
are descriptions of the key fields highlighted in Figure 3.22:
� Roll up Cost Component
By clicking on this field, the delta cost component value will be retained through
the supply chain if there are transfers between multiple companies.
� Not Relevant
This option means that although the delta cost component will be available, it
won’t be relevant for inventory valuation or any other category specified.
� Delta Profit for Group Costing
Checking the Company Code box enables the delta profit to show up in this cost
component. This indicator can only be set up for one cost component in the cost
component structure.
Now double-click the Cost Component Views folder to see the cost component views
shown in Figure 3.23.
Figure 3.23 Cost Component View Selection
In Figure 3.23, you can see the different views on the right part of the screen. Each of
these views can represent a different way to look at the cost components of the stan-
dard cost. Double-click the Cost of Goods Sold view to arrive at the screen shown in
Figure 3.24.
Select the filter you want to use. For this example, select Delta Profit Comp. Code to
be able to see the delta profit when you click on the Cost of Goods Sold view for the
group valuation standard cost. Save the settings by clicking the Save button.
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Figure 3.24 Cost of Goods Sold Cost Component View
Configuring a Special Procurement Key
In this step, you’ll configure a special procurement key so that the cost of a receiving
product can access the cost from a sending product in a different plant. The special
procurement key can be used to access the cost from an alternative plant that is in
the same or different company code as the receiving plant. In this scenario, the send-
ing plant will be in a different company, and, in conjunction with cross company
costing, the special procurement key will allow the receiving plant (1710) to access the
cost of the sending plant (1010) that is in a different company.
To set up the special procurement key, go to configuration menu path Controlling •
Product Cost Controlling • Product Cost Planning • Material Cost Estimate with Quan-
tity Structure • Settings for Quantity Structure Control • Material Data • Check Special
Procurement Types. In the subsequent screen, click New Entries to access the screen
shown in Figure 3.25.
Set up special procurement type (Sp.Pr.Type) Z2 in Plant 1710, which is set for External
procurement (F), and specify a Special procurement of Stock transfer (U) from Plant
1010. Click the Save button to save your settings.
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Figure 3.25 Define Special Procurement Key
Next, add this special procurement key to the Costing 1 view (heading not shown) of
the material in the receiving plant by entering “Z2” in the SpecProcurem Costing field,
as shown in Figure 3.26.
Figure 3.26 Adding the Special Procurement Key to the Material Master
Now that the special procurement key Z2 has been added to the material master of
the receiving plant (1710), this material can access the cost of the material in the send-
ing plant 1010.
Using Additive Cost for Intercompany Markup
Now let’s add a markup to the receiving company’s material. We mentioned earlier in
this chapter that there are several ways to include a markup in the standard cost esti-
mate. In this scenario, you’ll use the additive cost functionality. Additive cost allows
you to add an extra cost into the calculated standard cost. To enable the additive cost
for stock transfers, you first need to make a configuration change to the costing variant
of the legal view. To do this, go to the costing variant Transaction OKKN, and double-
click Costing Variant PPC1 to arrive at the screen shown in Figure 3.27.
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Figure 3.27 Enabling Additive Costs for Stock Transfers
Check the Include Additive Costs with Stock Transfers checkbox for Costing Variant
PPC1. This means that the additive costs will be included in the cost estimate that is
calculated from a cross company stock transfer. Click the Save button to save your
settings.
To create the additive costs, go to Transaction CK74N to open the screen shown in
Figure 3.28.
Figure 3.28 Selection Screen for Creating Additive Costs
Enter your Material (in this example, “RAW-123”) in Plant 1710, and specify the Costing
Variant as PPC1 (for the legal valuation view) and the Costing Version as 1. Press the
(Enter) button twice to access the screen shown in Figure 3.29.
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Figure 3.29 Entry Screen for Creating Additive Costs
Enter a Price - Total of “0.25”, which represents the intercompany markup for
Material RAW-123. This amount will be added to the standard cost estimate of this
material.
Standard Cost Calculation
Now that you’ve made all the relevant configuration settings for group costing, you
can calculate the standard cost for material RAW-123 in the legal and the group views.
Start with calculating the standard cost in the legal view by going to Transaction
CK11N; entering the Material as “RAW-123”, the Plant as “1710”, and the Costing Vari-
ant as “PPC1”; and pressing the (Enter) key twice. This will take you to the screen
shown in Figure 3.30.
Figure 3.30 Cost Estimate in Legal View
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As you can see in Figure 3.30, the cost estimate for material RAW-123 in plant 1710 is
$1.50. This is made up of the cost estimate of $1.25 from material RAW-123 in plant
1010 and the additive cost of $0.25, which represents the intercompany markup.
Now you can look at the standard cost in the group view. To do this, go back to the
selection screen of Transaction CK11N; enter the Material as “RAW-123”, the Plant as
“1710”, and the Costing Variant as “ZPC1”; and press the (Enter) button twice. This will
take you to the screen shown in Figure 3.31.
Figure 3.31 Cost Estimate in the Group View
As you can see in Figure 3.31, material RAW-123 in plant 1710 has a standard cost of 1.25
USD. It doesn’t include the additive cost because that represents the intercompany
markup, which isn’t part of the group valuation cost. However, you can also see that
the Cost of Goods Sold view shows a cost of 1.50 USD. This is the cost in the legal view,
which includes the intercompany markup. Double-click the Cost of Goods Sold view
to go to the Cost Components screen, as shown in Figure 3.32.
As you can see in Figure 3.32, the cost components of the Cost of Goods Sold view
shows a breakdown of the material’s standard cost as well as the Delta Profit (0.25
USD) that is contained in the transfer price from the sending company. This profit
will be viewable on any cost component report as long as you select the Cost of Goods
Sold view, and it will help you identify any intercompany profit in inventory.
3 Group Currency and Valuation
110
Figure 3.32 Delta Profit in Cost Component Split
Now take a look at the released standard cost in the material master by going to
Transaction MM03 and viewing the Accounting 1 view, as shown in Figure 3.33.
Figure 3.33 Material Master after Releasing Standard Cost
As you can see in Figure 3.33, material RAW-123 has a Standard Price in legal valuation
(Company code currency) of 1.50 USD, and in group valuation (Group currency, group
val) of 1.25 USD. The parallel view will be reflected with every material movement and
thereby provide multiple approaches for valuing this material.
111
3.3 Cross-Company Purchasing
3
3.3 Cross-Company Purchasing
Now we’ll look at a scenario where there is a cross-company purchase between two
companies to see the impact on the legal and group valuation views. First, look at the
sample data of the selling and buying companies you’ll be using in this scenario, as
shown in Table 3.1.
As you can see in Table 3.1, the scenario involves two companies, one in the United
States (1710), which is the selling company, and the other in Germany (1010), which is
the buying company. The standard cost in the legal view is represented in their
respective local currencies, while the standard cost in the group view is the same for
both companies. The US company is set up as an intercompany vendor (100071),
whereas the German company is set up as an intercompany customer (100070). In
this scenario, the US company will sell 1 EA of material FG-100 to the German com-
pany for 30 USD, which is 24 EUR.
Let’s walk through both the setup and the steps to complete a cross-company pur-
chasing scenario.
Field Selling Buying
Company Code 1710 1010
Country US Germany
Material FG-100 FG-100
Plant 1710 1010
Exchange Rate 1.25 USD 1 EUR
Standard Cost – Legal 20 USD 16 EUR
Standard Cost – Group 20 USD 20 USD
Intercompany Vendor/Customer 100071 100070
Sales/Purchase Price 30 USD 24 EUR
Table 3.1 Data for Materials in an Intercompany Scenario
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3.3.1 Intercompany Setup
Note that for the intercompany process to work correctly with group valuation, an
IDoc needs to be used to post the intercompany billing document, which will auto-
matically post an intercompany vendor invoice. Most of the settings that are needed
for this to work are done in the logistics functionality (as described in SAP Note 31126),
so we won’t go through them here. Instead, we’ll walk through the main settings that
are relevant for group valuation to function properly.
Valuation Difference Account
First, you’ll define a valuation clearing account for both companies 1010 and 1710.
This account records the difference between the transfer price and the selling com-
pany’s cost. Therefore, it represents the intercompany profit that was made from the
sale.
To configure this account, go to configuration menu path Controlling • General Con-
trolling • Multiple Valuation Approaches/Transfer Prices • Level of Detail • Define Val-
uation Clearing Account or use Transaction 8KEN. This will take you to the popup
screen shown in Figure 3.34.
Figure 3.34 Company Code for Valuation Clearing Account
In the Posted in company code field, enter “1010”, which means that this is the com-
pany code that you want to configure the account for. Now press the (Enter) key, and
click New Entries in the subsequent screen to arrive at the screen shown in Figure
3.35.
Enter trading partner (Tr.prt) “1710” and assign account “23000500” as the debit and
credit valuation clearing accounts. This means that when an intercompany transac-
tion is done in company code 1010 with a customer or vendor with the trading part-
ner 1710, this will be considered a business transaction between group companies.
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3.3 Cross-Company Purchasing
3
This account will be shown only in the group (or profit center) valuation view as a dif-
ference between the payable/receivable to the vendor/customer and the cost of the
product in the group valuation view.
Figure 3.35 Valuation Clearing Account Setup for Company Code 1010
Now click the Save button to save your settings for company 1010, and make the
same setting for company 1710, which is shown in Figure 3.36.
Figure 3.36 Valuation Clearing Account Setup for Company Code 1710
Set up the valuation clearing account for company code 1710 with a trading partner of
company 1010 so that when an intercompany transaction is done in company code
1710 with a customer or vendor with the trading partner 1010, this will be considered
a business transaction between group companies. Click the Save button to save your
settings.
Trading Partner and Plant in the Vendor Master
Next, you’ll assign the trading partner to the master data of the intercompany ven-
dor. Table 3.1 listed the intercompany vendor in this scenario as 100071, which will be
set up in company code 1010 (i.e., the buying company code). You can access the mas-
ter data of this vendor by going to Transaction BP and entering the vendor number
as a business partner.
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114
Note: Transaction BP
In SAP S/4HANA, Transaction BP is used to create and change the vendor and cus-
tomer master data. Transactions XK01/FK01/MK01 and XK02/FK02/MK02 are now
obsolete.
Then, select the Change in BP role as Supplier (Fin.Accounting) (defined), and enter
the Trading partner as “1710” in the Control tab, as shown in Figure 3.37.
Figure 3.37 Trading Partner in the Vendor Master
Now change the Change in BP role field to Supplier (defined), and enter the Plant in
the Vendor: General Data tab, as shown in Figure 3.38.
Figure 3.38 Plant in the Vendor Master
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3.3 Cross-Company Purchasing
3
As you can see in Figure 3.38, Plant 1710 has been assigned in the master data of ven-
dor 100071 to define this vendor as the shipping plant in an intercompany transac-
tion. Click the Save button to save your settings.
Trading Partner in the Customer Master
Now you’ll assign the trading partner to the master data of the intercompany cus-
tomer. Table 3.1 listed the intercompany customer in this scenario as 100070. This
customer is set up in company code 1710 (i.e., the selling company code), so you can
access the master data of this customer by going to Transaction BP. Enter the cus-
tomer number as a Business Partner, and select the Change in BP role as Customer
(Fin.Accounting) (New). Enter the Trading partner in the Control tab, as shown in
Figure 3.39.
Figure 3.39 Trading Partner in the Customer Master
As you can see in Figure 3.39, the trading partner for company 1010 has been assigned
in the master data of customer 100070, which represents the buying company.
Intercompany Pricing Procedure Conditions
Now let’s consider the intercompany pricing procedure, and make sure that the rele-
vant condition for group valuation is set up. To do this, go to Transaction V/08, select
the standard Intercompany Pricing Procedure ICAA01, and double-click the Proce-
dures – Control Data folder. This will take you to the screen shown in Figure 3.40.
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116
Figure 3.40 Intercompany Pricing Procedure with Group Valuation
As you can see in Figure 3.40, the Condition KW00 is present in the intercompany
pricing procedure, which means that the group valuation cost of the selling company
will be stored in this condition and will be posted to the revenue account in the group
valuation view when the intercompany billing document is posted.
Note: Intercompany Pricing Procedure
This condition is normally available in the standard intercompany pricing procedure
ICAA01. However, if it’s not present in your system, you’ll need to create it as a statis-
tical condition with condition category b (transfer price for group valuation) in Trans-
action V/06.
You’ll also notice that there are two other conditions shown in the screen:
� PC00
This represents the revenue in the profit center view. It’s a statistical condition
with condition category c (transfer price for the profit center) in Transaction V/06.
If profit center valuation is active, a condition record needs to be set up for this
condition to store the sales price of the selling profit center. This condition record
is set up in Transaction VK11, where you can enter the sales price in the Amount
field, as shown in Figure 3.41.
� PCVP
This condition represents the cost in the profit center view. It’s a statistical condi-
tion with condition category h (transfer price for the profit center) in Transaction
V/06. It’s an automatic condition and therefore doesn’t need a condition record.
We’ll discuss profit center valuation in Chapter 4.
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3.3 Cross-Company Purchasing
3
Figure 3.41 Condition Record for Condition Type PC00
3.3.2 Intercompany Scenario
Now we’ll walk through the cross-company process using the data that we’ve set up
for this scenario.
Creating an Intercompany Purchase Order
First, you’ll create a purchase order for the intercompany process. To do that, go to
Transaction ME21N to arrive at the screen shown in Figure 3.42.
Figure 3.42 Creating an Intercompany Purchase Order
Enter the Purch. Org. as “1010”, the Purch. Group as “001”, and the Company Code as
“1010” in the header section. Then go to the line item section, and enter the line item
number (Itm) as “10”, the Material as “FG-100”, and the PO Quantity as 1 EA. Then
enter the Deliv. Date as “01/07/2019”, the Net Price as “24.00” EUR, and the Plant as
“1010”. Now click the Save button to create the purchase order.
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118
Creating a Delivery
Now you need to deliver the purchase order. To do this, go to Transaction VL10B,
enter the purchase order number, and click the Execute button. This will take you to
the screen shown in Figure 3.43.
Figure 3.43 Creating the Delivery for Intercompany Purchase Order
Select the line with the purchase order, and click the Background button (not shown)
at the bottom of the screen. This will create a line with the delivery document num-
ber, as shown in Figure 3.44.
Figure 3.44 Delivery Document Created
Next, click the delivery document number to arrive at the screen shown in Figure
3.45.
Figure 3.45 Entering the Picked Quantity
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3.3 Cross-Company Purchasing
3
Enter a Picked Qty of “1” EA in the delivery document, which will represent the quan-
tity of material FG-100 that will be picked from plant 1710. Click the Save button to
save the delivery.
Now that the quantity has been picked, go back into the delivery document, and click
on the Post Goods Issue button highlighted in Figure 3.45. This will create a material
document that you can see by clicking on the Document Flow button on the same
screen, which will lead to the screen shown in Figure 3.46.
Figure 3.46 Document Flow after Goods Issue
You can see in Figure 3.46 that a material document number 4900000519 has been
created from the goods issue. Navigate from this document to the accounting docu-
ments by going to Transaction MIGO, entering the material document number, and
clicking on FI Documents in the Doc Info. tab. This will take you to the popup screen
shown in Figure 3.47.
Figure 3.47 List of Accounting Documents after Goods Issue
You can see in Figure 3.47 that there are two accounting documents created, one for
each company code. Let’s look at each document separately. First, double-click the
4900000109 Accounting document in company code 1010. This will take you to the
screen shown in Figure 3.48.
3 Group Currency and Valuation
120
Figure 3.48 Goods Receipt Accounting Document in the Legal View
As you can see in Figure 3.48, the accounting document in company 1010 is a goods
receipt document because company 1010 is the buying company. You’ll notice that
the amount posted to the inventory account 13400000 is 16 EUR, which is the legal
view standard cost in plant 1010; the amount posted to the GR/IR account is 24 EUR,
which is the purchase/transfer price, and the variance is 8 EUR. This represents the
legal valuation view of the accounting document. You’ll also notice that there is a
cross-company number with this document (Cross-Comp.No). This indicates that it’s
an intercompany transaction, based on the simultaneous goods receipt (in company
1010) and goods issue (in company 1710).
Now go to the group currency/group valuation document by clicking the Display Cur-
rency button shown in Figure 3.48. This will take you to the Display Currency for Doc-
ument popup screen shown in Figure 3.49.
Figure 3.49 Selecting the Group Currency Group Valuation View
121
3.3 Cross-Company Purchasing
3
Select the Group Crcy/Grp Valuation view. Click the Continue/Confirm button, which
will take you to the screen shown in Figure 3.50.
Figure 3.50 Goods Receipt Accounting Document in Group View
The group view of the goods receipt document shows a debit to inventory and a
credit to the GR/IR of 20 USD. This represents the group standard cost in plant 1010.
You’ll notice that the variance which showed up in the legal view is 0.00 in the group
view because the purchase price is equal to the group cost.
Now go back to the List of Documents in Accounting popup screen (refer to Figure
3.47), and double-click document number 4900000167 in company code 1710. This
will take you to the screen shown in Figure 3.51.
Figure 3.51 Goods Issue Accounting Document in Legal View
You can see that the accounting document in company 1710 is a goods issue docu-
ment because company 1710 is the selling company. You’ll notice that the amount
credited to the inventory Account 13400000 and debited to the cost of goods sold
(COGS) Account 50300001 is 20 USD, which is the legal view standard cost in plant
1710. This represents the legal valuation view of the accounting document. You’ll also
notice the same cross-company number (Cross-Comp.No) that you saw earlier in
Figure 3.48.
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122
Now go to the group currency/group valuation document by clicking the Display Cur-
rency button shown in Figure 3.51, selecting the Group Crcy/Grp Valuation option,
and clicking on the Continue/Confirm button. This will take you to the screen shown
in Figure 3.52.
Figure 3.52 Goods Issue Accounting Document in Group View
As you can see in Figure 3.52, the group view of the goods issue document shows a
credit to inventory and a debit to the COGS account of 20 USD. This represents the
group standard cost in plant 1710.
Now that you’ve seen the goods movement document in the legal and group views in
both company codes, let’s create the intercompany billing document.
Creating an Intercompany Billing Document
To create the intercompany billing document, go to Transaction VF01, and enter the
delivery Document “8000123” (see Figure 3.53).
Figure 3.53 Billing Document Entry Screen
Press the (Enter) key to go to the billing document details screen shown in Figure
3.54. As you can see in Figure 3.54, the intercompany billing document will be created
for 30 USD and represents the sale of 1 EA of Material FG-100 to customer (Payer)
100070, which represents company 1010.
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3.3 Cross-Company Purchasing
3
Figure 3.54 Billing Document Detail Screen
Click the Save button to post the billing document. Now you can view the accounting
document by going go Transaction VF03, entering the Billing Document number just
created, and clicking on the Accounting button, as shown in Figure 3.55.
Figure 3.55 Accessing the Accounting Document from a Billing Document
When you click the Accounting button, the subsequent screen will show the account-
ing document number of the billing document that you created. By double-clicking
on the accounting document number, you’ll be taken to the screen shown in Figure
3.56.
Figure 3.56 Accounting Document of the Billing Document in the Legal View
As you can see in Figure 3.56, the accounting document shows a debit to the cus-
tomer reconciliation Account 12300000 (representing plant 1010) and a credit to the
3 Group Currency and Valuation
124
revenue Account 41000000 of 30 USD, which is the sales price. This represents the
legal view of the accounting document.
Now go to the group currency/group valuation document by clicking on Display Cur-
rency (not shown), selecting the Group Currency/Group Valuation option, and click-
ing on the Continue/Confirm button. This will take you to the screen shown in Figure
3.57.
Figure 3.57 Accounting Document of the Billing Document in the Group View
As you can see in Figure 3.57, the group view of the accounting document shows a
debit to receivables account 12300000 of 30 USD (representing the sales price), a
credit to revenue account 41000000 of 20 USD (representing the group cost), and the
difference of 10 USD goes to valuation clearing account 23000500, which we defined
earlier in Figure 3.36. This represents the intercompany profit.
Now that you’ve created the intercompany billing document, let’s create the inter-
company payable document.
Creating an Intercompany Payable Document
To create the intercompany payable document, you’ll need to create an IDoc by going
to Transaction VF31, which is the transaction to create an output document from a
billing document, arriving at the screen shown in Figure 3.58.
Figure 3.58 Entry Screen for Creating the IDoc
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3.3 Cross-Company Purchasing
3
Enter your Billing Document number (shown in Figure 3.55), and check the Intercom-
pany billing checkbox. Then, click the Execute button (not shown), which will take
you to the screen shown in Figure 3.59.
Figure 3.59 Output from the Billing Document
Select the Bill. Doc. number, and click the Process button at the bottom of the output
screen (not shown). If the document was processed successfully, a message at the bot-
tom of the screen will appear, as shown in Figure 3.60.
Figure 3.60 Message from Processing Output
You can now view the intercompany payable document that was created by the IDoc.
Although there are several ways to do this, you can simply go to the accounting doc-
ument that was created previously in Figure 3.57 and choose Environment • Docu-
ment Environment • Relationship Browser from the menu bar. A very useful
document appears that shows all the documents connected to your intercompany
scenario, as shown in Figure 3.61.
Figure 3.61 Relationship Browser of the Intercompany Scenario
3 Group Currency and Valuation
126
As you can see, all the connected documents in your intercompany scenario are
shown in the relationship browser. Navigate to the intercompany payable document
by double-clicking on the highlighted Accounting document 5100000037 in com-
pany 1010, which will take you to the document shown in Figure 3.62.
Figure 3.62 Intercompany Payable Document in the Legal View
The accounting document shows a debit to the COGS account 50300001 and a credit
to the intercompany payable account 21300000 of 24 EUR, which is the purchase
price. This represents the legal view of the accounting document.
Now go to the group currency/group valuation document by clicking on the Display
Currency button (not shown), selecting the Group Currency/Group Valuation option,
and clicking on the Continue/Confirm button. This will take you to the screen shown
in Figure 3.63.
Figure 3.63 Intercompany Payable Document in the Group View
As you can see in Figure 3.63, the group view of the accounting document shows a
debit to COGS account 50300001 of 20 USD (representing the group cost), a credit to
intercompany payables account 21300000 of 30 USD (representing the purchase
price), and the difference of 10 USD goes to the valuation clearing account 23000500,
which we defined much earlier in Figure 3.36. This debit of $10 offsets the credit of $10
posted in the intercompany receivables document (refer to Figure 3.57) and thereby
eliminates the intercompany profit when reported with the group valuation view.
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3.4 Summary
3
3.4 Summary
In this chapter, we looked at a key valuation approach: group currency and group val-
uation. First, we looked at how group currency is defined and assigned to a company
code and the Material Ledger. We also showed how the group currency can be
changed when updating a material’s cost. We walked through how to define a costing
variant for group costing and how to track the delta profit made between companies
when calculating the group standard cost. Looking at a detailed intercompany sce-
nario, we showed the Material Ledger configuration and master data settings that
need to be made in an intercompany transaction, and then we looked at the materials
movement, intercompany sales, and intercompany purchase documents that are
created both in the legal and the group valuation views.
In the next chapter, we’ll discuss the profit center valuation view.
7
Contents
Preface ..................................................................................................................................................... 15
1 Introduction to the Material Ledger in SAP S/4HANA 21
1.1 What Is the Material Ledger? ......................................................................................... 21
1.2 The Before: The Material Ledger in SAP ERP ........................................................... 26
1.2.1 Inventory Valuation ............................................................................................. 28
1.2.2 Multiple Valuation Approaches ....................................................................... 35
1.2.3 Actual Costing ....................................................................................................... 40
1.3 The After: The Material Ledger in SAP S/4HANA .................................................. 47
1.3.1 SAP S/4HANA Finance ......................................................................................... 47
1.3.2 Why Is the Material Ledger Mandatory? ...................................................... 53
1.3.3 Inventory Valuation in SAP S/4HANA ............................................................ 54
1.4 Summary ................................................................................................................................. 58
2 Configuring Currency Types, Ledgers, and Valuation Views 61
2.1 Defining Currency Types for the General Ledger .................................................. 62
2.1.1 Standard SAP Currency Types ........................................................................... 62
2.1.2 Defining Standard Currency Types in the Universal Journal ................. 66
2.2 Currency Conversion Settings for Company Codes .............................................. 69
2.3 Defining the Currency and Valuation Profile .......................................................... 71
2.3.1 Maintaining the Currency and Valuation Profile ....................................... 72
2.3.2 Assigning the Currency and Valuation Profile to the
Controlling Area .................................................................................................... 73
2.3.3 Creating Versions for the Valuation Methods ............................................ 73
2.3.4 Activating the Currency and Valuation Profile ........................................... 74
Contents
8
2.4 Defining Ledgers for Valuation Views ....................................................................... 75
2.4.1 Multi-Valuation Ledger ...................................................................................... 76
2.4.2 Single Valuation Ledger ..................................................................................... 78
2.5 Defining Ledgers for Controlling Versions ............................................................... 79
2.6 Material Ledger Activation for Currencies and Valuations .............................. 80
2.6.1 Defining Material Ledger Types and Assigning Currency Types .......... 81
2.6.2 Assigning Material Ledger Types to Valuation Areas .............................. 82
2.6.3 Activating Material Ledgers for Valuation Areas ...................................... 83
2.7 Summary ................................................................................................................................. 85
3 Group Currency and Valuation 87
3.1 Group Currency .................................................................................................................... 87
3.1.1 Setting Up Group Currency for a Company Code ..................................... 88
3.1.2 Changing Material Cost ..................................................................................... 91
3.1.3 Making a Purchase .............................................................................................. 93
3.2 Group Valuation .................................................................................................................. 95
3.2.1 Transfer Pricing with Group Valuation ......................................................... 96
3.2.2 Group Valuation with Standard Cost ............................................................ 97
3.3 Cross-Company Purchasing ............................................................................................ 111
3.3.1 Intercompany Setup ........................................................................................... 112
3.3.2 Intercompany Scenario ...................................................................................... 117
3.4 Summary ................................................................................................................................. 127
4 Profit Center Valuation 129
4.1 Transfer Pricing Logic with Profit Center Valuation ............................................ 130
4.1.1 Defining the Currency Type for Profit Center Accounting ..................... 130
4.1.2 Defining Transfer Pricing for Profit Center Valuation ............................. 131
4.1.3 Settings for Internal Goods Movement ........................................................ 139
4.2 Standard Cost and Profit Center Valuation ............................................................. 143
4.2.1 Defining a Costing Variant for Profit Center Valuation .......................... 143
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Contents
4.2.2 Assigning Transfer Price Variant to the Costing Version ........................ 148
4.2.3 Configuring a Delta Cost Component .......................................................... 148
4.2.4 Configuring a Special Procurement Key ....................................................... 150
4.2.5 Calculating Standard Cost ................................................................................. 152
4.3 Cross-Profit Center Purchasing ...................................................................................... 157
4.4 Manufacturing Orders with Profit Center Valuation .......................................... 161
4.4.1 Material Consumption in a Different Profit Center .................................. 162
4.4.2 Goods Receipt in a Different Profit Center .................................................. 165
4.5 Summary ................................................................................................................................. 169
5 Configuring Actual Costing 171
5.1 Material Ledger Activation for Actual Costing ....................................................... 172
5.1.1 Maintaining Number Ranges for Material Ledger Documents ............ 172
5.1.2 Configuring Dynamic Price Changes ............................................................. 175
5.2 Material Update ................................................................................................................... 175
5.2.1 Defining Movement Type Groups of the Material Ledger ...................... 176
5.2.2 Assigning Movement Type Groups of the Material Ledger .................... 177
5.2.3 Defining the Material Update Structure ...................................................... 178
5.2.4 Assigning Material Update Structure to the Valuation Area ................ 180
5.3 Actual Costing ....................................................................................................................... 181
5.3.1 Activating Actual Costing .................................................................................. 181
5.3.2 Creating User-Defined Names for Receipts/Consumption .................... 183
5.3.3 Assigning User-Defined Names for Receipts/Consumption ................. 184
5.3.4 Activating Actual Cost Component Split ...................................................... 186
5.3.5 Activating Work in Process at Actual Cost ................................................... 187
5.4 Account Determination .................................................................................................... 188
5.4.1 Cost/Price Differences for the Material Ledger .......................................... 189
5.4.2 Materials Management Exchange Rate Differences ............................... 191
5.4.3 Revaluation of Other Consumables .............................................................. 193
5.4.4 Accruals and Deferred Accounts for the Material Ledger ....................... 194
5.4.5 Activity Price Differences .................................................................................. 196
5.4.6 Material Ledger Cost Center Absorption ..................................................... 197
5.4.7 Work In Process from Price Differences—Material ................................... 198
Contents
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5.4.8 Work in Process from Price Differences—Activity Types ....................... 199
5.4.9 Differences of Canceled WIP—Materials ..................................................... 200
5.4.10 Differences of Cancelled WIP—Activity Types .......................................... 202
5.5 Summary ................................................................................................................................. 203
6 Actual Costing Run and Analysis 205
6.1 Actual Costing Cockpit ...................................................................................................... 206
6.2 Actual Costing Run ............................................................................................................. 207
6.2.1 Setup ........................................................................................................................ 208
6.2.2 Selection .................................................................................................................. 210
6.2.3 Preparation ............................................................................................................ 212
6.2.4 Settlement .............................................................................................................. 218
6.2.5 Post Closing ............................................................................................................ 222
6.2.6 Mark Prices ............................................................................................................. 225
6.2.7 Additional Options .............................................................................................. 228
6.3 Alternative Valuation Run .............................................................................................. 232
6.4 Material Price Analysis ..................................................................................................... 239
6.4.1 Navigating the Material Price Analysis ......................................................... 240
6.4.2 Price Determination Structure ........................................................................ 245
6.4.3 Price History ........................................................................................................... 250
6.4.4 Material Price Analysis for Old SAP ERP Data ............................................. 252
6.4.5 Actual Cost Components ................................................................................... 253
6.4.6 Valuated Quantity Structure ............................................................................ 256
6.5 Activity Consumption Analysis ..................................................................................... 258
6.6 Value Flow Monitor ........................................................................................................... 262
6.6.1 Not Distributed Differences ............................................................................. 263
6.6.2 Not Allocated Differences ................................................................................. 265
6.6.3 Using the Value Flow Monitor ......................................................................... 267
6.7 General Ledger Postings Made by the Material Ledger ..................................... 269
6.7.1 Closing Document of the Material Ledger .................................................. 269
6.7.2 Analyzing General Ledger Postings Made by the Material Ledger ...... 270
6.8 Summary ................................................................................................................................. 274
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Contents
7 Actual Costing and Peripheral Transactions 275
7.1 Changing Standard Cost Mid-Month .......................................................................... 275
7.1.1 Restriction on Changing the Standard Cost Mid-Month in SAP ERP ... 276
7.1.2 Changing the Standard Cost Mid-Month in SAP S/4HANA ................... 277
7.2 Debiting/Crediting Material ........................................................................................... 279
7.2.1 Debiting/Crediting a Material Directly ......................................................... 280
7.2.2 Defining Reasons for the Price Change ......................................................... 282
7.2.3 Debiting/Crediting a Material with an Alternative
General Ledger Account ..................................................................................... 284
7.2.4 Debiting/Crediting a Material to a Specific Cost Component .............. 285
7.3 Distributing Consumption Variances ......................................................................... 289
7.3.1 Activating Distribution of Consumption Variances .................................. 289
7.3.2 Distributing Differences for Materials .......................................................... 294
7.3.3 Distributing Differences for Activities ........................................................... 299
7.4 Manually Changing Cost Components ...................................................................... 303
7.4.1 Price Difference Account for Cost Component Change .......................... 303
7.4.2 Changing the Cost Component ....................................................................... 304
7.5 Deactivating Statistical Moving Average Price ...................................................... 307
7.6 Summary ................................................................................................................................. 310
8 Parallel Cost of Goods Manufactured 311
8.1 What Is Parallel Cost of Goods Manufactured? ..................................................... 311
8.2 Activating the Business Function ................................................................................. 313
8.3 Maintaining the Valuation View .................................................................................. 315
8.4 Defining Ledgers and Accounting Principles ........................................................... 317
8.5 Configuring Parallel Valuation ...................................................................................... 319
8.6 Calculating a Parallel Activity Rate ............................................................................. 321
8.6.1 Calculating the Depreciation in Different Accounting Principles ........ 322
8.6.2 Posting Activity Consumption to a Production Order .............................. 325
Contents
12
8.7 Calculating with Multiple Costing Runs ................................................................... 332
8.7.1 Actual Costing Run .............................................................................................. 332
8.7.2 Alternative Valuation Run ................................................................................. 333
8.8 Summary ................................................................................................................................. 338
9 Balance Sheet Valuation 339
9.1 What Is Balance Sheet Valuation? .............................................................................. 339
9.2 Configuring Balance Sheet Valuation ........................................................................ 341
9.2.1 Activating FIFO/LIFO Valuation ....................................................................... 341
9.2.2 Defining Valuation Level ................................................................................... 342
9.2.3 Defining FIFO/LIFO-Relevant Movement Types ........................................ 343
9.2.4 Defining FIFO/LIFO Methods ............................................................................ 343
9.2.5 Configuring FIFO/LIFO Valuation Areas ....................................................... 344
9.2.6 Defining LIFO Layer Versions ............................................................................ 345
9.2.7 Defining Document Types for the Lowest Value Method ...................... 346
9.2.8 Defining Movement Types for the Lowest Value Method ..................... 346
9.2.9 Defining Key Figure Scheme ............................................................................ 347
9.2.10 Setting Up Valuation Alternatives ................................................................. 347
9.2.11 Defining the FIFO Variant ................................................................................. 348
9.3 FIFO Valuation ...................................................................................................................... 349
9.3.1 Creating a Purchase Order and Goods Receipt .......................................... 349
9.3.2 Activating a FIFO Material ................................................................................. 353
9.3.3 Calculating Periodic Receipt Values ............................................................... 355
9.3.4 Calculating the FIFO Price ................................................................................. 356
9.3.5 Updating the Material Price ............................................................................. 360
9.4 LIFO Valuation ...................................................................................................................... 361
9.4.1 Creating Purchase Orders and Goods Receipts .......................................... 362
9.4.2 Activating a LIFO Material ................................................................................. 364
9.4.3 Calculating the LIFO Price .................................................................................. 367
9.5 Lowest Value Determination ......................................................................................... 368
9.6 Using Balance Sheet Valuation in Actual Costing ................................................ 372
9.7 Summary ................................................................................................................................. 374
13
Contents
10 The Material Ledger and Peripheral Applications 375
10.1 Split Valuation ...................................................................................................................... 375
10.1.1 Configuring Split Valuation .............................................................................. 376
10.1.2 Creating a Material Master with Multiple Valuation Types .................. 379
10.1.3 Procuring Split Valuated Materials ................................................................ 382
10.1.4 Calculating Actual Cost for Split Valuated Material ................................. 383
10.2 Actual Costing for Make-to-Order Products ............................................................ 385
10.2.1 Make-to-Order Production Process ................................................................ 385
10.2.2 Calculating the Actual Cost ............................................................................... 388
10.3 Daily Actual Costs ................................................................................................................ 392
10.3.1 Creating Actual Costing Runs for Future Periods ...................................... 392
10.3.2 Creating Variants for Actual Costing Steps ................................................. 395
10.3.3 Creating and Sequencing Background Jobs ................................................ 400
10.4 Exchange Rate Differences .............................................................................................. 403
10.4.1 Configuring the Treatment of Exchange Rate Differences .................... 404
10.4.2 Purchasing a Material with Exchange Rate Differences ......................... 406
10.4.3 Exchange Rate Differences in the Material Price Analysis ..................... 410
10.5 Actual Costing across Company Codes ...................................................................... 412
10.5.1 Cross-Company Scenario ................................................................................... 413
10.5.2 Setting Up Actual Costing across Company Codes ................................... 415
10.5.3 Material Price Analysis before the Actual Costing Run ........................... 416
10.5.4 Material Price Analysis after the Actual Costing Run ............................... 420
10.6 Profitability Analysis .......................................................................................................... 425
10.6.1 COGS Account Split by Cost Components .................................................... 426
10.6.2 Production Variance Account Split by Variance Categories ................... 437
10.7 Summary ................................................................................................................................. 443
11 Reporting 445
11.1 ABAP List Viewer Reports ................................................................................................. 445
11.1.1 Prices and Inventory Values .............................................................................. 446
11.1.2 Materials with Largest Moving Price Differences ...................................... 451
Contents
14
11.1.3 Materials with Highest Inventory Value ...................................................... 452
11.1.4 Display of Work in Process for Actual Costs ................................................ 453
11.2 Drilldown Reports ............................................................................................................... 457
11.3 SAP Fiori Applications ....................................................................................................... 461
11.3.1 Trial Balance App .................................................................................................. 462
11.3.2 Material Inventory Values Apps ...................................................................... 471
11.4 CDS Views ............................................................................................................................... 480
11.5 Summary ................................................................................................................................. 482
12 Conclusion 483
12.1 What You’ve Learned ........................................................................................................ 483
12.2 Potential Areas for Innovation ...................................................................................... 486
Appendices 489
A Transitioning to the Material Ledger in SAP S/4HANA ...................................... 491
B General Ledger Line Item Texts from Material Ledger Postings .................... 519
C Material Ledger Comparison: SAP ERP versus SAP S/4HANA ......................... 523
D Bibliography .......................................................................................................................... 525
E The Author ............................................................................................................................. 527
Index ........................................................................................................................................................ 529
529
Index
A
ABAP List Viewer reports ................................... 445
highest inventory value ................................. 452
largest moving price differences ................ 451
prices and inventory values ......................... 446
WIP for actual costs ........................................ 453
Account determination ..................................... 188
table ....................................................................... 188
Account modification ......................................... 283
Account-based CO-PA ............................... 426, 439
Accounting principle ........................................... 311
assigning ............................................................. 319
defining ................................................................ 317
Accounts approach .............................................. 312
Accounts payable ..................................................... 23
Accounts receivable ................................................ 23
Accruals .................................................................... 194
Activity consumption analysis ....................... 258
activity adjustment ......................................... 299
CO document ..................................................... 261
cost components .............................................. 262
header fields ....................................................... 259
price determination view .............................. 260
Activity consumption update ......................... 182
Activity price differences ................................... 196
Activity price report .................................. 260, 330
Activity quantity distribution ......................... 302
Activity rate ............................................................. 321
Actual activity price ................................... 207, 328
Actual cost components .................................... 253
Actual costing ............................................................ 24
across company codes ................ 412, 413, 415
activating ............................................................ 181
activating WIP ................................................... 187
activities .............................................................. 497
analysis ................................................................ 205
assigning user-defined names .................... 184
balance sheet valuation ................................ 372
calculation .......................................................... 205
configuring ............................................... 171, 181
cost component split ...................................... 186
Actual costing (Cont.)
creating user-defined names ....................... 183
daily ....................................................................... 392
group valuation ............................................... 413
material transactions .................................... 176
moving average price .................................... 307
MTO ....................................................................... 385
new ........................................................................ 207
peripheral transactions ................................. 275
SAP ERP ............................................................ 40, 42
split valuation ................................................... 383
steps ...................................................................... 207
Actual costing cockpit ........................................ 206
accessing ............................................................. 208
buttons ................................................................. 228
mark prices ......................................................... 225
post closing ........................................................ 222
preparation ........................................................ 212
prerequisites ...................................................... 206
SAP ERP ................................................................... 42
settlement ........................................................... 219
Actual costing run ....................................... 205, 207
additional options ........................................... 228
creating variants .............................................. 395
daily ....................................................................... 403
future periods ........................................... 392, 394
mark prices ......................................................... 225
MTO ....................................................................... 388
parallel COGM ................................................... 332
post closing ........................................................ 222
preparation ........................................................ 212
results .......................................................... 229, 231
selection ............................................................... 210
settlement ........................................................... 218
setup ...................................................................... 208
timing ................................................................... 225
valuation alternative ..................................... 373
Actual transfer price ............................................ 136
Additive costs ................................................ 101, 106
creating ................................................................ 107
Aggregate tables ....................................................... 55
Alternative price ................................................... 220
Index
530
Alternative valuation run (AVR) ............ 209, 232
classic ................................................................... 233
cockpit .................................................................. 238
creating ................................................................ 233
parallel COGM ......................................... 333, 335
results ................................................................... 238
SAP ERP ................................................................... 44
settings ................................................................. 236
uses ........................................................................ 232
Assets ............................................................................ 23
B
Backflushing ........................................................... 289
Background job ..................................................... 400
daily ...................................................................... 400
Background processing ...................................... 224
Balance sheet ............................................................. 23
Balance sheet valuation .............................. 30, 339
actual costing .................................................... 372
configuring ......................................................... 341
FIFO ....................................................................... 349
LIFO ....................................................................... 361
Bill of materials (BOM)
actual .................................................................... 243
Business add-ins (BAdIs) .................................... 429
Business function
activating ............................................................ 313
LOG_MM_SIT .................................................... 415
Business partner ...................................................... 50
C
Calculation base ....................................................... 98
CDS views ................................................................ 480
Characteristics ....................................................... 457
Chart .......................................................................... 475
Closing document ................................................ 269
Closing history ...................................................... 244
COGS account ........................................................ 426
COGS configuring splitting .......................... 428
revaluation of consumption ....................... 435
split by cost components .............................. 426
split from PGI .................................................... 432
Company .................................................................... 65
Company code .......................................................... 65
Company code currency ...................................... 62
Comparison price .................................................. 369
Compatibility view ................................................. 58
Condition record ................................................... 133
Condition type ....................................................... 132
creating ...................................................... 132, 135
fixed ....................................................................... 136
linking ......................................................... 134, 135
percentage ........................................................... 132
Consolidation ........................................................... 95
Consumption variance ....................................... 289
distributing ......................................................... 289
Contracts .................................................................. 369
Controlling (CO) functionality ......................... 425
Controlling (CO) module ............................... 24, 27
Controlling area ....................................................... 73
Controlling area currency .................................... 63
Controlling level .................................................... 183
Controlling object currency ................................ 66
Convergence cycle ................................................ 220
Cost center absorption ........................................ 197
Cost center report ................................................. 326
Cost component
activity consumption analysis .................... 262
costing lot size ................................................... 255
direct material ................................................... 285
manually changing ............................... 303, 304
MTO ....................................................................... 389
structure ..................................................... 186, 320
view .............................................................. 254, 418
Cost component split ...................... 110, 154, 186
activating ............................................................ 186
changing .............................................................. 304
material price analysis ................................... 253
MTO ....................................................................... 390
Cost element ........................................................... 186
Cost estimate ................................................ 109, 152
Cost of goods sold (COGS) ........................ 427, 431
Cost splitting profile ............................................ 429
Costing levels .......................................................... 216
Costing type .............................................................. 98
group valuation .................................................. 98
profit center valuation ................................... 144
Costing variant
group valuation ......................................... 97, 101
profit center valuation ......................... 143, 146
531
Index
Costing-based CO-PA ................................. 425, 427
Credit of cost centers ........................................... 183
Crediting ................................................................... 279
Cross-company costing ...................................... 102
activating ............................................................ 102
Cross-company purchasing .............................. 111
scenario ................................................................ 117
setup ...................................................................... 112
Cross-profit center purchasing ....................... 157
Cumulate data ........................................................... 44
Currency and valuation profile ................ 71, 315
activating ............................................................... 74
assigning to controlling area ......................... 73
maintaining .......................................................... 72
Currency conversion
company code ...................................................... 69
currency type ........................................................ 70
global ....................................................................... 69
Currency key .............................................................. 62
Currency type
assigning ................................................................ 81
configuring ............................................................ 61
defining for the G/L ............................................ 62
naming .................................................................... 69
profit center accounting ............................... 130
reporting .............................................................. 448
single valuation ledger ..................................... 79
standard .................................................. 62, 66, 67
user-defined .................................................... 67, 68
D
Daily actual costs .................................................. 392
Data migration ....................................................... 494
activities .............................................................. 495
run .......................................................................... 494
Date control ............................................................... 98
Debit/credit material ................................ 279, 420
alternative G/L account ................................ 284
directly .................................................................. 280
reasons for price change ............................... 282
specific cost component ................................ 285
Debiting .................................................................... 279
Deferred accounts ................................................ 194
Definition level ......................................................... 69
Delivery document .............................................. 118
Delta cost component
group valuation ............................................... 103
profit center valuation .................................. 148
settings ........................................................ 104, 149
split ........................................................................ 413
Delta posting .......................................................... 233
Depreciation area .......................................... 70, 322
assigning ............................................................. 319
Depreciation run .................................................. 324
Determine delta postings .................................... 44
Determine sequence .............................................. 43
Distribution of usage variances (DUV) ........ 289
activating ............................................................ 289
activities .............................................................. 299
material price analysis .................................. 298
materials ............................................................. 294
specifying movement types ......................... 290
Document currency ............................................... 62
Document table .................................................... 309
Document type
lowest value method ...................................... 346
mapping .............................................................. 432
Drilldown report ................................................... 457
classic ................................................................... 459
material breakdown ....................................... 461
multiple characteristics ................................. 460
Dynamic price release ..................... 175, 226, 276
E
Exchange rate differences ........................ 191, 403
AVR ........................................................................ 237
causes ................................................................... 404
configuring treatment ................................... 404
material price analysis .................................. 410
purchasing material ....................................... 406
settings ................................................................. 404
Exchange rate type .............................................. 405
Exchange rate variance ...................................... 206
Extension ledger ...................................................... 75
External procurement ............................... 377, 382
F
Financial Accounting (FI) module ............. 24, 27
Finished goods .......................................................... 22
Index
532
First in, first out (FIFO) ......................... 31, 32, 340
activating ............................................................ 341
activating material ......................................... 353
alternative price ............................................... 359
calculating price ............................................... 356
configuring valuation areas ....................... 344
defining method ............................................... 343
defining movement types ............................ 343
periodic receipt values ................................... 355
updating material price ................................ 360
value ..................................................................... 358
variant ................................................................. 348
Fixed assets ................................................................ 23
Future cost estimate ........................................... 429
Future price ............................................................. 226
G
G/L account splitting .......................................... 439
General Ledger ...................... 23, 27, 284, 269, 519
classic ...................................................................... 27
currency types ...................................................... 62
exchange rate difference .............................. 412
line items ............................................................. 519
new .......................................................... 27, 51, 312
posting ........................................................ 269, 270
General modification .......................................... 283
Generally Accepted Accounting
Principles (GAAP) ............................................ 311
Global category ..................................................... 378
Global company currency ................................... 64
Global types ............................................................ 376
creating ................................................................ 377
Goods issue .............. 119, 325, 351, 353, 364, 411
group view .......................................................... 122
legal view ............................................................ 121
Goods receipt ........... 93, 350, 351, 362, 363, 382,
387, 407
accounting document ................................... 166
different profit center ..................................... 165
group view .......................................................... 121
profit center view ............................................. 167
Group costing ........................................................... 97
Group currency ................................................. 64, 87
changing material cost .................................... 91
making a purchase ............................................ 93
setting up for company code ......................... 88
settings ................................................................... 89
Group valuation .............. 38, 71, 87, 95, 413, 424
AVR ......................................................................... 237
costing variant .................................................... 97
delta cost component ..................................... 103
standard cost ....................................................... 97
Group valuation view ............................................ 97
Group view .............................................................. 109
buying company ..................................... 419, 424
cost components .................................... 420, 425
delta cost component split ........................... 413
H
Hard currency ........................................................... 64
HelpDesk .................................................................. 506
administration .................................................. 517
AVR ......................................................................... 514
balance sheet valuation ................................ 513
cost component split ....................................... 511
master data ........................................................ 509
miscellaneous .................................................... 512
next architecture tables ................................. 516
overview ............................................................... 507
production orders ............................................ 512
purchase order history ................................... 513
transaction data ............................................... 508
WIP ......................................................................... 515
I
IDoc ............................................................................. 112
Index-based currency ............................................ 64
Intercompany billing document .................... 122
group view ........................................................... 124
Intercompany customer .................................... 115
Intercompany markup ....................................... 101
additive costs ..................................................... 106
Intercompany payable document ................. 124
group view ........................................................... 126
legal view ............................................................. 126
Intercompany pricing procedure ................... 115
533
Index
Intercompany purchase order ........................ 117
delivering ............................................................. 118
Intercompany transactions .............................. 416
Intercompany vendor ......................................... 113
Internal goods movement ................................ 139
settings ................................................................. 140
Inventory adjustment ........................................ 294
DUV ....................................................................... 296
Inventory Management (IM) module ............. 54
Inventory valuation ................................................ 28
attributes ................................................................ 32
SAP Fiori apps ....................................................... 55
SAP S/4HANA ........................................................ 54
scenarios ................................................................. 31
subledger ................................................................ 53
tables ................................................................. 34, 55
Inventory value ........................................................ 23
Invoice receipt ....................................................... 409
Invoice verification .............................................. 404
J
Job overview ........................................................... 228
K
Key figure ................................................................. 457
Key figure scheme ................................................ 347
defining ................................................................ 347
L
Last in, first out (LIFO) ........................... 31, 32, 340
activating ............................................................ 341
activating material ......................................... 364
calculating price ............................................... 367
configuring valuation areas ........................ 344
defining method ............................................... 343
defining movement types ............................. 343
layer versions ..................................................... 345
valuation ............................................................. 361
Late price change .................................................. 276
Leading ledger .................................................... 51, 75
Lean manufacturing ............................................ 385
Ledger .................................................................... 23, 51
CO versions ............................................................ 79
Ledger (Cont.)
configuring ............................................................ 61
defining ......................................................... 75, 321
Ledger approach ................................................... 312
Ledger group .......................................................... 318
Legacy System Migration
Workbench (LSMW) ........................................ 393
Legal valuation .................................................. 38, 71
Legal valuation view ..................................... 97, 102
Legal view ............................................. 108, 146, 159
buying company ..................................... 418, 422
cost components ..................................... 418, 423
delta cost component split .......................... 413
selling company ............................................... 416
Liabilities ..................................................................... 23
LIFO layer ................................................................. 345
Line Items report .................................................. 480
Local currency ............................................... 407, 409
Lower of cost and market (LCM) ........................ 31
Lowest value determination ............ 31, 340, 368
output ................................................................... 371
update prices ..................................................... 370
Lowest value method .......................................... 346
Lowest value principle ................................. 32, 340
M
Main costing run .................................................. 232
Make-to-order (MTO) .......................................... 448
actual costing .................................................... 385
production process .......................................... 385
Make-to-stock (MTS) ........................................... 385
actual costing .................................................... 390
Manual checkbox .................................................... 81
Manufacturing order .......................................... 161
Mark material prices .............................................. 43
Mark prices .............................................................. 225
AVR ........................................................................ 238
parameters ......................................................... 226
Material ....................................................................... 21
Material consumption ....................................... 162
accounting document .................................... 164
cost ........................................................................ 163
profit center view ............................................. 165
Material cost .............................................................. 91
Index
534
Material Inventory Values apps ..................... 471
balance summary ............................................ 472
line items ............................................................. 479
rounding differences ...................................... 477
Material Ledger
activating actual costing ............................. 172
activating currencies and valuations ......... 80
benefits ................................................................... 26
conversion tables ................................................ 45
definition ................................................................ 21
HelpDesk ............................................................. 506
limitations ............................................................. 26
mandatory ............................................................ 53
misconceptions ................................................... 24
periodic tables ...................................................... 56
SAP ERP ............................................................ 26, 46
SAP S/4HANA ....................................................... 47
Material Ledger conversion ............................. 491
data migration ................................................. 494
existing customers .......................................... 491
new customers .................................................. 498
Material Ledger type ........................................... 498
assigning ................................................................ 82
defining ................................................................... 81
Material master ........................................................ 22
actual costing ....................................................... 40
company code and group currency ............ 90
FIFO ....................................................................... 354
LIFO ....................................................................... 366
MTO ....................................................................... 386
price change .......................................................... 93
split valuation ................................................... 381
standard cost ............................................ 110, 155
Material movement tables .................................. 56
Material period ...................................................... 207
Material price analysis .............................. 231, 239
accounting postings ....................................... 272
actual cost components ................................ 253
after actual costing run ................................ 420
AVR ........................................................................ 239
before actual costing ...................................... 416
changed standard cost .................................. 278
consumption ..................................................... 185
cost component change ................................ 306
debit/credit material ...................................... 281
display buttons ................................................. 242
Material price analysis (Cont.)
drilldown .............................................................. 258
DUV ........................................................................ 297
exchange rate difference ..................... 410, 411
FIFO ........................................................................ 360
header buttons .................................................. 240
header fields ............................................. 240, 241
inventory adjustment ..................................... 295
MTO ....................................................................... 389
MTS ........................................................................ 391
not allocated ...................................................... 266
not distributed ................................................... 263
parallel COGM AVR ......................................... 338
period status ....................................................... 241
price determination structure ..................... 245
price history ........................................................ 250
prices and inventory values ......................... 450
revaluation of consumption ........................ 435
SAP ERP ................................................................... 44
SAP ERP data ...................................................... 252
split valuation .................................................... 384
valuated quantity structure ......................... 256
valuation alternatives .................................... 373
Material update ...................................................... 175
assigning movement type groups ... 177, 180
defining movement type groups ................ 176
defining structure ............................................. 178
Material valuation .................................................. 32
Material valuation table .............................. 56, 308
Materials management (MM) .......................... 341
Measures ................................................................... 467
Movement type
defining ................................................................ 142
FIFO/LIFO ............................................................. 343
lowest value method ....................................... 346
reversal ................................................................. 292
Movement type group ........................................ 176
options .................................................................. 177
Moving average costing ................................ 29, 31
statistical ............................................................... 42
Moving average price ............................................ 91
deactivating ....................................................... 307
Multilevel price determination ......................... 43
Multiple valuation approaches ......................... 35
Multiple valuations ......................................... 71, 73
535
Index
Multi-valuation ledger ........................................... 76
currency types ...................................................... 77
setting up ............................................................... 77
N
Negative price .............................................. 220, 265
Nonleading ledger ............................................ 51, 75
Not allocated differences ................................... 265
Not distributed differences .............................. 263
causes ................................................................... 264
Number range ........................................................ 172
accounting document .................................... 174
Material Ledger documents ......................... 173
O
Offsetting account ................................................ 431
Origin group ........................................................... 286
P
Parallel activity rate ............................................. 321
calculating deprecation ................................ 322
posting activity consumption ..................... 325
Parallel cost of goods manufactured ... 233, 311
accounting principles ..................................... 317
creating a version ............................................ 316
creating an AVR ................................................ 335
ledgers .................................................................. 317
multiple costing runs ..................................... 332
valuation view .................................................. 315
value flow ............................................................ 312
Parallel currencies ................................................... 36
derive in SAP ERP ................................................ 36
Parallel ledger approach ....................................... 51
Parallel valuation .................................... 24, 38, 311
configuring ......................................................... 319
Partner version ......................................................... 98
group valuation ................................................... 99
profit center valuation ................................... 144
Period status ........................................................... 276
Period totals table ................................................. 309
Period-end ............................................................... 206
Periodic receipt values ........................................ 355
Periodic unit price (PUP) ................... 40, 205, 246
Peripheral application ........................................ 375
Planned transfer price ........................................ 132
Plants .................................................................. 80, 502
Post closing ............... 43, 188, 189, 192–194, 196,
198–200, 206, 222, 269, 392
AVR ........................................................................ 238
future periods .................................................... 394
output ................................................................... 225
parameters ......................................................... 223
processing options .......................................... 224
Post goods issue (PGI) ......................................... 426
document ............................................................ 433
Preliminary valuation ........................................ 254
Preparation ............................................................. 212
background jobs ............................................... 402
creating variants .............................................. 397
errors ..................................................................... 217
output .......................................................... 216, 218
parameters ......................................................... 214
previous period ................................................. 215
Price change
defining reasons ............................................... 282
Price control .......................... 30, 40, 250, 380, 504
Price determination ........................................ 40, 84
changing ............................................................. 504
mutlilevel ................................................... 219, 247
single/multilevel .............................................. 189
single-level ................................................. 219, 247
Price determination structure ........................ 245
activity consumption analysis ................... 260
columns ............................................................... 246
rows ....................................................................... 245
Price difference account .................................... 303
Price history ............................................................ 250
columns ............................................................... 251
Price variance ......................................................... 206
Pricing procedure .............................. 134, 135, 138
Processing type ..................................................... 223
Product Cost Controlling module .................... 24
Production order ............................... 163, 165, 325
calculating variances ..................................... 167
cost analysis ................................... 165, 326, 387
production variance ....................................... 440
settlement ........................................................... 168
zero delivery ....................................................... 265
Index
536
Production startup .............................................. 500
output log ........................................................... 501
Production variance ................................... 141, 437
account configuration ................................... 438
configuring accounts ..................................... 439
settlement ........................................................... 442
Profit center ............................................................ 129
Profit center currency ........................................ 130
Profit center valuation ......................... 38, 71, 129
AVR ........................................................................ 237
currency types ................................................... 130
delta cost component .................................... 149
manufacturing order ..................................... 161
standard cost ..................................................... 143
transfer pricing ................................................. 131
Profit center view ........... 139, 159, 164, 167, 169
cost ........................................................................ 116
revenue ................................................................ 116
standard cost ..................................................... 155
Profitability analysis (CO-PA) .......................... 425
Purchase info records ......................................... 369
Purchase orders .................................................... 369
Push logic ................................................................ 271
Q
Quantity structure control .................................. 98
R
Raw materials ............................................................ 22
Relationship browser .......................................... 125
Reporting .......................................................... 49, 445
ALV ........................................................................ 445
CDS views ............................................................ 480
drilldown ............................................................. 457
SAP ERP ................................................................... 52
SAP Fiori apps ................................................... 461
SAP S/4HANA ....................................................... 52
Retroactive enablement ....................................... 73
Revaluation .................................................... 193, 194
WIP ........................................................................ 198
Revaluation of consumption ................... 43, 219,
224, 248
COGS split ........................................................... 435
Revaluation reason ..................................... 287, 303
Reversal posting .................................................... 273
Reverse goods movements ............................... 290
Run reference ......................................................... 234
creating ................................................................ 333
parallel COGM ................................................... 333
S
Sales cost estimate ................................................ 428
SAP ERP ....................................................................... 26
accounting structure ........................................ 24
inventory valuation .......................................... 28
old data ................................................................ 252
parallel cost of goods manufactured ....... 312
reporting ................................................................ 52
restrictions ................................................ 275, 276
versus SAP S/4HANA ....................................... 523
SAP Fiori ............................................................. 52, 461
SAP Fiori apps ........................................... 50, 52, 461
inventory valuation .......................................... 55
SAP HANA ........................................................... 49, 55
SAP S/4HANA ............................................................ 47
actual costing .................................................... 207
AVR ......................................................................... 232
conversion ........................................................... 491
CO-PA .................................................................... 425
evolution ................................................................ 47
financial reporting ............................................. 52
flexibility .............................................................. 275
inventory valuation .......................................... 54
ledger approach ................................................ 312
material price analysis ................................... 239
variances .............................................................. 263
versus SAP ERP .................................................. 523
SAP S/4HANA Finance .......................................... 47
core areas .............................................................. 48
SAP Simple Finance ................................................ 47
Schedule Manager ................................................ 228
Scrapping .................................................................. 142
Selection ............................................................ 42, 210
background jobs ............................................... 402
creating variants .............................................. 395
Semifinished goods ................................................ 22
Server group ............................................................ 214
Settlement ...................................................... 208, 218
background jobs ............................................... 402
537
Index
Settlement (Cont.)
creating variants .............................................. 398
legal view ............................................................. 168
output ................................................................... 222
parameters ......................................................... 219
profit center view ............................................. 169
Settlement document ......................................... 244
Simulation ledger .................................................... 76
Single source of truth ................................... 50, 426
Single valuation ledger .......................................... 78
setting up ............................................................... 78
Single-level price determination ....................... 43
Source document ................................................. 244
Special procurement key
group valuation ................................................ 105
profit center valuation ................................... 150
Special purpose ledger .................................... 51, 66
Special stock .................................................. 388, 504
Split valuation ........................................................ 375
calculating actual cost .................................. 383
configuring ......................................................... 376
creating a material .......................................... 379
procuring materials ........................................ 382
Splitting profile ............................................ 439, 440
Standard cost .......................................................... 205
changing mid-month ........................... 275, 277
group valuation ................................................ 108
group view .......................................................... 109
profit center valuation ................................... 152
SAP ERP ................................................................ 276
SAP S/4HANA ..................................................... 277
Standard cost estimate
group valuation ................................................... 97
profit center valuation ................................... 143
Standard costing ............................................... 28, 31
Standard ledger ........................................................ 75
Stock coverage check ........................................... 220
Stock value ................................................................. 23
Strategy sequence ................................................. 429
Subledger .................................................................... 23
Supply chain .............................................................. 97
T
Table
ACDOCA ......................... 50, 56, 67, 94, 436, 502
Table (Cont.)
ACDOCA_M_EXTRACT ..................................... 56
CKMLCR ............................................................... 309
CKMLKEPH ............................................................ 57
CKMLMYMP ....................................................... 356
CKMLPR_EB .............................................. 358, 372
EBEW(H) ............................................................... 308
FCML ..................................................................... 480
MATDOC ................................................... 48, 56, 58
MBEW ........................................................ 34, 56, 94
MBEW(H) ............................................................. 308
MKPF ................................................................. 56, 58
MLCR ..................................................................... 309
MLDOC .......................................... 56, 57, 239, 263
MLDOCCCS ..................................................... 56, 57
MLDOCCS ............................................................ 239
MLKEPH .................................................................. 57
MSEG ................................................................. 56, 58
MYMLM ............................................................... 368
OBEW ....................................................................... 56
OBEW(H) .............................................................. 308
QBEW ....................................................................... 56
QBEW(H) .............................................................. 308
TDUVN156 ........................................................... 290
TVARVC ................................................................ 396
Trading goods ........................................................... 22
Trading partner ..................................................... 112
assigning to customer ................................... 115
assigning to vendor ........................................ 113
Transaction
0KE5 ...................................................................... 130
8KEM .............................................................. 39, 315
8KEN ...................................................................... 112
8KEP ......................................................................... 74
8KEZ ............................................................. 131, 162
ABZON .................................................................. 322
AFAB ...................................................................... 323
BP .................................................................. 113, 115
BSD ........................................................................ 233
BSX ......................................................................... 270
CK11N ................................................. 108, 152, 155
CK40N .................................................................. 152
CK74N ................................................................... 107
CKM3 ........... 180, 185, 240, 252, 281, 295, 297,
373, 383, 450
CKM3A ......................................................... 259, 299
Index
538
Transaction (Cont.)
CKM3N ................................................................. 240
CKM3OLD ............................................................ 252
CKMCCC ..................................................... 241, 304
CKMDUVACT ..................................................... 300
CKMDUVMAT .......................................... 294, 296
CKMDUVREC ..................................................... 299
CKME .................................................................... 226
CKMHELP ............................................................ 506
CKMLBB_AGGREGATE .................................. 355
CKMLBB_FIFO_CALCULAT .......................... 357
CKMLBB_PRICES_CHANGE ......................... 360
CKMLBB_PRICES_LIST ................................... 359
CKMLCP ............... 208, 233, 333, 373, 383, 388,
393, 422
CKMLCPAVR ......................................................... 44
CKMLQS ...................................................... 182, 256
CKMM ............................................................ 85, 504
CKMSTART ................................................... 45, 500
CKMTOPPRICEDIF ........................................... 451
CKMTOPSTOCKVAL ........................................ 452
CKMVFM ............................................................. 264
CKR1 ...................................................................... 277
CO03 .................................................. 163, 165, 386
COMLWIPDISP .................................................. 454
CON2 ..................................................................... 182
FAGL_FCV ....................................................... 70, 76
FAGLL03 .............................................................. 269
FB50 .............................................................. 207, 279
FB60 ...................................................................... 282
FCML_FILL .......................................................... 480
FCML4H_STARTUP ......................................... 497
FCMLHELP .......................................................... 506
FINS_MIG_STATUS ................................ 494, 496
FINSC_LEDGER ........................ 67, 75, 77, 78, 88
FS00 ...................................................................... 140
KALC ......................................................................... 27
KB21N .................................................................... 325
KBK6 ..................................................................... 261
KDM ...................................................................... 412
KKF1 ....................................................................... 325
KKF3 ...................................................................... 326
KKML0 ................................................................. 458
KKML1 .................................................................. 458
KKML5 .................................................................. 458
KKS1 ....................................................................... 388
Transaction (Cont.)
KKS2 .......................................... 167, 332, 383, 440
KO88 ............................................................ 168, 442
KSB5 ....................................................................... 261
KSBT ............................................................. 260, 330
KSII ............................................................... 261, 328
LKW ........................................................................ 270
M107 ...................................................................... 295
ME11 ....................................................................... 369
ME21N ............................. 117, 350, 351, 362, 407
MIGO .......... 119, 157, 325, 350, 351, 362, 364,
387, 407
MIRO ...................................................................... 282
ML4HVFM ................................................. 263, 267
MLCCSPD ......................................... 241, 255, 389
MM01 .................................................................... 379
MM02 .................................................................... 151
MM03 ... 90, 110, 155, 226, 241, 352, 361, 365
MMPV ......................................................... 207, 245
MR21 ............................................................... 91, 276
MR22 ...................... 207, 279, 284, 287, 303, 420
MRF4 ...................................................................... 353
MRL1 ...................................................................... 367
MRL6 ...................................................................... 364
MRL9 ...................................................................... 365
MRN0 .................................................................... 370
OABT ........................................................................ 70
OB08 ............................................................... 89, 406
OB52 ....................................................................... 207
OBYC ..... 88, 188, 281, 303, 412, 427, 438, 497
OKEQ ..................................................................... 320
OKG8 ..................................................................... 199
OKK4 ............................................................ 100, 146
OKKI ................................................................ 98, 144
OKKN ................................................. 101, 106, 146
OKKP ....................................................................... 63
OKTZ .................................................. 103, 148, 186
OKYV ..................................................................... 102
OMJJ ....................................................................... 290
OMW3 .................................................................... 345
OMW4 ................................................................... 343
OMWE ................................................................... 341
OMWEB ................................................................. 373
OMWL ................................................................... 342
OMWP ................................................................... 343
OMWT ................................................................... 345
539
Index
Transaction (Cont.)
OMX1 ..................................................................... 504
OMX2 ....................................................................... 90
OMX3 ....................................................................... 89
OX02 ........................................................................ 62
OX15 .......................................................................... 64
OY01 ......................................................................... 64
PRD-MAC ............................................................. 307
PRM ....................................................................... 201
PRY ......................................................................... 191
S_ALR_87013611 ................................................ 326
S_P99_41000062 ............................................. 446
SCC4 .......................................................................... 64
SE16N ..................................................................... 161
SE38 ........................................... 308, 395, 397, 398
SFW5 ............................................................ 313, 415
SM30 ........................................................... 290, 294
SM36 ...................................................................... 400
SM37 ...................................................................... 228
TRS ......................................................................... 271
UMD ...................................................................... 233
V/06 ...................................................................... 116
V/08 ....................................................................... 115
VF01 ....................................................................... 122
VF31 ........................................................................ 124
VK11 ........................................................................ 116
VL10B .................................................................... 118
XK01/FK01/MK01 ............................................. 114
XK02/FK02/MK02 ........................................... 114
Transaction key
COC ........................................................................ 273
GBB ........................................................................ 426
GBB-AUI ..................................................... 196, 497
KDV ........................................................................ 497
LKW ........................................................................ 194
PRA ......................................................................... 202
PRD ..................................................... 281, 303, 438
PRL ............................................................... 196, 497
PRV ......................................................................... 497
UMB ....................................................................... 281
WPM ............................................................ 198, 200
Transfer control and reference variant ........... 98
Transfer price variant .......................................... 148
Transfer pricing ................................................. 73, 96
company codes ................................................. 102
defining ................................................................ 131
Transfer pricing (Cont.)
markup ................................................................ 134
profit center valuation .................................. 130
simulation ....................................... 153, 155, 157
Trial Balance app ................................................... 462
dimensions ......................................................... 468
filters ..................................................................... 463
materials ............................................................. 466
measures ............................................................. 467
navigating to activities ................................. 470
parameters ......................................................... 462
U
Universal Journal ............. 49, 53, 79, 94, 312, 498
CO-PA ................................................. 426, 436, 443
currency types ...................................................... 67
key features ........................................................... 50
ledgers ..................................................................... 75
profit center document ................................. 161
settings .................................................................... 61
Update control ....................................................... 293
User-defined name .............................................. 183
assigning ............................................................. 184
V
Valuated quantity structure ............................ 256
Valuation alternatives ........................................ 347
Valuation approach ................................................ 72
Valuation area .......................................... 32, 82, 180
activating ..................................................... 83, 499
currency type statuses ...................................... 83
FIFO/LIFO ............................................................ 344
Valuation category .................................................. 33
Valuation class .......................................................... 33
Valuation clearing account .............................. 112
Valuation level ....................................................... 342
Valuation methods ................................................. 55
creating versions ................................................. 73
Valuation type ....................................... 33, 377, 380
Valuation variant ..................................................... 98
group valuation ............................................... 100
profit center valuation .................................. 145
Valuation view
configuring ............................................................ 61
Index
540
Valuation view (Cont.)
maintaining ....................................................... 315
multi-valuation ledger ..................................... 77
parallel COGM .................................................. 316
setting up ............................................................... 71
single valuation ledger ..................................... 78
Value flow monitor .............................................. 262
using ..................................................................... 267
Variance categories .......................... 438, 439, 441
W
Work in process (WIP) ......................................... 187
actual cost .......................................................... 187
actual cost values ............................................ 453
Work in process (WIP) (Cont.)
canceled materials ........................................... 200
cancelled activities ........................................... 202
consumption ...................................................... 248
detailed report ................................................... 456
multilevel variance .......................................... 250
reduction .................................................... 244, 249
revaluation ........................................ 43, 212, 219
revaluation from activities ........................... 199
revaluation from material ............................ 198
standard report ................................................. 456
First-hand knowledge.
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Paul Ovigele has worked as an SAP financials consultant since 1997 in both North America and Europe, specializing in implementing the financial accounting and controlling modules along with their integrated areas for companies in the consumer goods, chemicals, logistics, pharmaceuticals, apparel, and entertainment industries. Paul has delivered numerous training sessions to finance professionals at both
the functional and managerial levels and has presented at various SAP financi-als conferences around the world. Paul is the founder of the consulting plat-form ERPfixers, which provides on-demand SAP consulting expertise in various modules.
Paul Ovigele
Material Ledger in SAP S/4HANA:Functionality and Configuration540 Pages, 2019, $89.95 ISBN 978-1-4932-1825-7
www.sap-press.com/4863