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SAP Controlling Period End Closing

SAP Period end closing consists of the next periodic precise postings:
  1. . Periodic reposting, evaluation, distribution, indirect exercise allocation
  2. . Overhead
  3. . Process costs
  4. . Precise value revaluation
  5. . Settlement
  6. . Periodic reposting

Different interval-finish closing actions embody the following:

. Interval locking
. Updating the reconciliation ledger

Overhead costs
Overhead costing is the means by which you allocate oblique prices to the suitable objects. This includes making use of a proportion or amount-based mostly mounted quantity to a specified cost base. To use overhead, you employ major value elements that were posted directly to the order. Within the manufacturing industry, for instance, these are often the labor and materials costs.You may apply overhead to both deliberate and precise prices, or on the idea of commitment data.For testing and forecasting purposes you can even simulate the costing. Data is simply not up to date in the database. The costing results are displayed as statistics and any errors are recorded in an error log.

You'll have the opportunity to print out both the statistics and the error log.The rules for making use of overhead are summarized in the overhead costing sheet.The overhead costing sheet combines three central elements which outline the overhead calculation.The calculation base specifies the price aspect base to which overhead is utilized, such because the materials cost elements. You presumably can additional limit the bottom by figuring out the origin range. The origin subdivides the associated fee ingredient by material.The overhead key means that you simply can define the quantity of overhead to be utilized as follows:
  1. . In the proportion method, you identify base cost elements. A percentage is applied to the costs posted to these value elements. The calculated value is added as overhead.
  2. . Within the amount-primarily based overhead technique, you specify the quantity of overhead cost to be utilized (per quantity unit posted) to the calculation base price elements. On this case, units of measure must be recorded in Controlling (CO). You possibly can enter the unit of measure in the cost ingredient master record. Alternatively, if you occur to put up materials with different units of measure to the identical value factor, you have to set the material grasp indicator Material origin . Materials with differing quantity units must even be assigned to different origin groups if they're to be posted under the identical value element.
  3. . The dependency permits you to differentiate overhead rates or quantities by plant, firm code, profit center, responsible cost heart, order kind, or different criteria.
  4. . The overhead sort determines whether or not the overhead calculation is for precise, plan, or dedication data.
The credit key defines which object (price centers or inside orders) is credited to offset the debit to your overhead order. That is also where you specify the cost element to which the overhead is posted.

Other periodic prices
You'll have the option to allocate exercise to overhead cost orders from cost facilities in Cost Middle Accounting (COOM-CCA). In an exercise allocation, you enter the quantity of exercise offered in the transaction,and the price posting is derived from the plan price. Revaluation means that you can update the related fee posting based on the precise price. The method value perform, allows you to allocate prices to overhead value orders from business processes in Activity Based mostly Costing (CO-OM-ABC). The allocation is defined by a course of template developed in Exercise Based mostly Costing.

Comparison with debit
Major postings (corresponding to telephone costs) are collected on clearing cost middle or order to reduce the variety of postings in FI. These costs are allocated to the suitable controlling objects (reminiscent of an overhead value order), at period-end closing in response to a consumer-outlined key.

. Line gadgets are recorded for each the sender and receiver sides to doc the allocations exactly.
. Periodic allocations may be reversed and repeated as typically as desired.

Order credit score
You can credit score an order by periodically reposting prices, using the cycle section method. Periodic repostings is more likely to be made to several receivers utilizing allocation rules. This distinguishes the applicable portion for every receiver to be posted.

Settlement overview
You normally use overhead price orders as an interim collector of prices, and as an help to planning,monitoring, and reporting processes. When the task is complete, the prices are transferred to their final destination (value heart, WBS ingredient, profitability segment, and so on). This course of is called settlement.In settlement, some or all of the costs posted to an order are allotted to a quantity of receivers. The offset postings, which credit the order, are generated automatically. You'll give you the chance to settle orders individually or collectively.The costs collected on an order will be settled to a many different account assignment objects, as illustrated above. Settlement to an asset or common ledger account is an external settlement, because FI is updated by the settlement. Settlement to one of the remaining objects is an inner settlement in CO.

You can settle statistically to a price heart, statistical order, or statistical WBS element, as properly as the actual receivers.Order settlement is just not mandatory.

Defining Order settlement
Earlier than you can settle an order, you could specify where you want to ship the costs. There are two procedures for outlining settlement: Primary settlement and extended settlement. Basic settlement permits you to settle one hundred% of the costs to a minimum of one cost heart or to one G/L account,using one settlement price element. You enter the information in Interval Finish Closing on the order master record.Prolonged settlement means that you simply can create Settlement Rules within the order grasp file which allows you to:
  1. . Settle prices to one or more receivers and permit a variety of receivers (WBS factor, gross sales
  2. order, profitability segment, and so on)
  3. . Specify how the prices are to be cut up (distribution guidelines)
  4. . Specify the cost elements to be used for settlement (settlement value elements or authentic price components)
In prolonged settlement, the settlement course of is managed by assignments in the Settlement Parameters on the order grasp record. These parameters embody the settlement profile, settlement construction, PA transfer structure, and so on. The settlement profile, which specifies the default values for the opposite parameters, is derived from the order type. You'll give you the chance to change the defaulted settlement parameters on the order grasp record.You might want to specify a settlement profile within the order master, even in the occasion you use the basic settlement function. This ensures that a settlement profile is on the market if you later change to extended settlement.

Maintaining Settlement Rule
You presumably can enter the distribution guidelines in the Settlement Rule Overview screen. The distribution rule specifies which portion of the order prices needs to be settled to which receiver. Every line in the distribution desk defines the allocation to a specific receiver. Prices might be allotted to the receivers base on the next:
  1. . Proportion
  2. . Equivalence number
  3. . Fastened amount
The SAP R/3 System ensures that you simply can't create a rule containing both an quantity and an equivalence number or a percentage. That is checked periodically, which permits you to change from settlement by proportion to settlement by equivalence numbers, by creating multiple distribution guidelines for a receiver and assigning totally different validity periods. The following settlement varieties are defined in the system for overhead orders:

. Settlement kind PER settles only the prices for the period you specify.
. Settlement type FUL settles all costs on a sender object that are not but settled, for all intervals as a lot as the settlement period.

Customizing Profile
The settlement profile is the central management parameter for settlement.It's entered in the order sort and defaults to the order grasp record. The settlement profile defaults the settings proven above:
. It determines the way of settlement
. It specifies legitimate settlement receivers and identifies the default object sort (resembling price heart) for the receiver. The default object sort will present up while you mainatin a settlement rule to an order with this profile. Only the settlement receivers allowed right here it is possible for you to to make use of in a settlement rule for an order with this profile.
  1. . It sets settlement indicators including the valid methods for apportioning costs
  2. . It defines document administration parameters
  3. . It identifies the default values for the other settlement parameters on the order grasp document: the settlement construction, Profitability Evaluation transfer construction, and the supply structure

The Profitability Evaluation (PA) transfer construction controls the task of cost components to worth fields in costing-primarily based Profitability Analysis. It is used provided that you settle inner orders directly to Profitability Analysis.The supply structure controls settlement to different receivers dependent on the unique price parts posted on the order.

Parameters in customizing
The central control parameter for settlement is the settlement profile , which is entered within the order sort and thus offers the defaults for the order grasp record. The settlement profile performs the following:
  1. . Determines whether or not settlement is required
  2. . Specifies valid settlement receivers and identifies the default object type (such as value heart) for the receiver
  3. . Units settlement indicators together with the legitimate strategies for apportioning prices . Defines doc administration parameters
Identifies the default values for the other settlement parameters in the order grasp record: The settlement construction, PA transfer construction, and the source construction

The settlement structure controls the task of original price components to settlement value elements. You can too use the original value aspect for settlement.The PA switch construction controls the project of cost elements to worth fie lds in costing-based mostly Profitability Analysis. It is used only if you agree inside orders on to Profitability Analysis.The source structure controls settlement to completely different receivers, depending on the original value parts posted on the order.

Settlement of Order Prices
You'll have the option to settle prices to your receivers utilizing the identical cost elements that have been initially posted to your order. This allows you to determine in detail the kinds of prices which have been allotted to your receivers, similar to material, provides, and personnel costs. Alternatively, you can use a settlement cost aspect to allocate costs. With this strategy, you probably can easily determine what costs have been allocated to the receivers throughout the order settlement process.

There are two classes of settlement price elements:
  1. . An inside settlement cost component (cost aspect kind 21) is used whenever you settle to a controlling object resembling a cost middle, order, WBS aspect, and so on.
  2. . An exterior settlement value aspect (price aspect sort 22) is used whenever you settle to an asset or a general ledger account.
After settlement, the costs incurred on the order are nonetheless seen, regardless of which approach you select. This lets you analyze and report on your order costs at any time.Every time an object is settled, a settlement document is created. That is required whenever you reverse a settlement run or repeat a period closing. You outline the number ranges for settlement paperwork throughout system configuration. To handle information sets, you outline the residence time in the settlement profile. This is the timeframe after which the settlement doc will be archived.

In addition to the settlement doc, the system additionally creates:

. An FI doc containing all accounting-associated knowledge (external settlement solely)
. A CO doc containing solely value accounting-associated information

Hierarchical Settlement
The SAP R/3 System lets you settle prices from one order to another. This implies you can enter data at various levels of summarization. The instance uses orders to gather prices for particular person restore and upkeep activities. To receive summarized data on the repair and maintenance costs for the turbine and cooling unit, you compromise these orders to orders representing every machine. To view the whole restore and maintenance prices for the location you agree the “machine” orders to a remaining “Power station” order.You'll give you the chance to process this group of related orders in the identical settlement run utilizing the collective processing feature. To ensure that all the orders are settled fully, you could settle the orders in the right sequence. To perform this, the system determines a settlement hierarchy.

On the idea of the settlement guidelines (which you identify for every order), the system mechanically determines the processing sequence and assigns a hierarchy quantity between 000 and 999 to the order. The orders are settled from the very best to the bottom hierarchy quantity, in different phrases, 000 is at the high of the hierarchy, which implies that it is the final to settle. When you enter settlement guidelines that don't end result in the complete settlement of your orders in a single settlement run, the system displays the appropriate message. You probably can manually enter hierarchy numbers to specify the sequence during which the orders should be settled. On this case, you must repeat settlement processing till all objects could be settled to zero.

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