KEY FEATURES OF SAP S/4 HANA FINANCE – 1709 ON-PREMISE

It’s high time to learn new Finance automation process and accept changes that comes with SAP Leonardo for faster decision making, adaptability, innovation, business acceleration, better outcomes and it keep’s SAP customer’s employees focus on the real job to be done.

Let’s go through the “Finance – Innovations”

• Universal Journal: Subsequent implementation of document split
• Parallel valuation: 3rd currency in Controlling and Cost of Goods Manufactured.
• Accounting: General ledger document split
• Financial Planning: Basic Sales Planning (Activity Price, Consumption)
• Cash Management: Bank relationship management including bank fee analysis; Improved Integration with Bank Communication Management and In-House Cash
• Machine Learning for Cash Application – Invoice Matching clear incoming payments by matching them with the corresponding receivables
• Soft close and prediction: Minimum closing time; Early insight into business trends
• Integration: Seller-side integration with Ariba Network (invoice and discount management); Cost center (SuccessFactors); Payment advice (Fieldglass); Ariba Pay/ Supply Chain Finance
• Central finance

1. Shared Services in Accounts Payables/Receivables
2. Central reversal and correction capabilities
3. financial reporting scenarios

• SAP Fiori apps Roles

1. Accounts Payable/Receivable Accountant
2. Accounts Receivable Manager
3. Controller (Production Costs, Credit)
4. Treasury Risk Manager
5. Asset Accountant
6. General Ledger Accountant
7. Inventory Accountant

TOPIC – 1: UNIVERSAL JOURNAL – SUBSEQUENT INTRODUCTION OF DOCUMENT SPLITTING

To fulfill the IFRS reporting requirements, you need to report your financial data at a lower level of detail than your company code. With this feature, you can introduce new account assignment objects, such as segment or profit center, and add these account assignments to your journal entries when you post them. To ensure that you have a complete reporting view of each account assignment object, the opening balance is enriched and split, per account. The enrichment of relevant accounting data is carried out in the project cockpit, according to the new account assignment information. To ensure correct processing of open items, at the time document splitting is active, this feature allows you to enrich open items.

TOPIC – 2: MACHINE LEARNING – SAP CASH APPLICATION INTEGRATION

SAP Cash Application is a cloud service that integrates with S/4HANA Cloud Edition as of 1702 and S/4HANA on-premises as of 1709 (hybrid model).

The integration to SAP Cash Application solution intends to automate the invoice-matching process and provide the prediction results back to the SAP S/4HANA system with the help of machine learning.

SAP Cash Application enables you to match open receivables to incoming bank statement items using machine learning.

In the finance area, and more specifically in the area of accounts receivables, incoming bank statement items are ideally matched automatically to open receivables such as invoices. Any manual post-processing of incoming bank statement items that could not be matched to open receivables takes time and effort. SAP Cash Application uses machine learning procedures to train financial applications in order to learn from manual matchings, and thus achieve higher automatic matching rates.

 KEY FUNCTIONALITIES OF SAP CASH APPLICATION:

⊕ Proposing open receivables for incoming bank statement items

You can schedule jobs to receive a list of Machine Learning proposals for matching receivables to existing bank statement items

⊕ Clearing incoming bank statement items.

You can schedule jobs to automatically clear incoming bank statement items based on Machine Learning proposals, if the following conditions are met:

• The matching rate of the proposal is higher than specified in the configurations
• The proposed receivables are still open
• All other clearing rules are fulfilled

⊕ Proposing customer accounts for incoming bank statement items

You can schedule jobs to receive a list of Machine Learning proposals for matching accounts to existing bank statement items.

• The matching rate of the proposal is higher than specified in the configurations
• The proposed account is a valid existing account

⊕ Posting incoming bank statement items

You can schedule jobs to automatically post incoming bank statement items to accounts based on Machine Learning proposals.

SAP CASH APPLICATION DETAILED WORKFLOW:

TOPIC – 3: INTERCOMPANY REPORTING 

• Shows reconciliation amount and difference in object group for company and its partner
• Drills down to line item details
• Displays detailed information of document
• Shows the reconciliation processing status
• Navigates to reconciliation monitoring page for manual reconciliation
• Sends mail and reminder to contact person

TOPIC – 4:  PROFITABILITY ANALYSIS IN THE UNIVERSAL JOURNAL

SPLITTING COST OF GOODS SOLD IN SAP S/4HANA

Enhanced functionality enables to split costs of goods sold during more processing such as third party or other processes with account assignment to internal orders or projects

COGS SPLITTING CUSTOMIZING HAS BEEN ADJUSTED

Previous COGS Split functionality which processed the splitting only for goods movements with reference to a sales order is still available

SPLITTING COST OF GOODS SOLD IN SAP S/4HANA 1610 SCREEN AND 1709 SCREEN

TOPIC – 5: MATERIAL VALUATION IN S/4HANA  – MATERIAL LEDGER

• Up to 3 currencies
  • Tracking historic rates in material master
  • Local legal valuation & e.g. hard or trading currency
• Actual Costing
  • Optional revaluation of stock and COGS
  • Leverage Actual cost component split

Thank You

Jayanth Maydipalle

Source: SAP, JAM, ML, AI and Other.

Tagged 1709, Actual Costing, CLOUD, COGS Splitting, Finance – Innovations, Intercompany Reporting, Key Features of SAP S/4 HANA FINANCE – 1709 On-premise, Key functionalities of SAP Cash Application, Machine Learning, Machine Learning – SAP Cash Application, Machine Learning – SAP Cash Application Integration, Material Valuation in S/4HANA, Material Valuation in S/4HANA  – Material Ledger, on premise, Profitability Analysis in the Universal Journal, SAP,Splitting Cost of Goods Sold in SAP S/4HANA 1610 Screen and 1709 Screen, Universal JournalLeave a comment

SAP FINANCIAL CLOSING COCKPIT

Posted on 24 Jul 2017

ACCOUNTING AND FINANCIAL CLOSE

SAP’s accounting and financial close solutions streamlines the accounting for multiple companies, currencies, charts of accounts, and reporting standards. The solutions enable finance to efficiently close books on time, and create financial statements at the entity and corporate levels for IFRS, U.S. GAAP, or other local and global requirements.

• SAP offers a modern accounting system for finance teams needing to streamline core financial and closing processes to meet increasingly complex business and disclosure demands.
• It accelerates your company’s path to financial transformation by eliminating boundaries between transactional and analytical processes combined with proven excellence in accounting and closing capabilities.
• SAP Financial Closing cockpit = Transactions codes “FCLOCOx“

TOP 10 BENEFITS OF SAP ACCOUNTING AND FINANCIAL CLOSE SOLUTIONS

1. Lower Cost of Finance

Accelerated processes increase productivity and reduce cost. Automate manual steps  to reduce staff workloads which lowers the cost of their work and increases productivity.

2. Accelerated Closing

Reduce cycle time via automation, integration and collaboration. Virtual soft close provides better insight at anytime from anywhere. Accelerate accounting by integrating GL, fixed assets, accounts payables, accounts receivables, inventory, revenue, and costs in real-time.

3. Real-Time Business Insight

Enables fast issue resolution and gets you closer to the business. Monitor in real-time the progress, quality, and financial results of the closing cycle to avoid bottlenecks and address business concerns

4. Responsiveness

Closes the gap between insight and action. Achieve fast, multi-dimensional reporting without replicating information to a data warehouse Instant access anywhere with drill-down from the highest to the lowest level of detail.

5. Harmonization
Harmonize internal and external reporting without redundancy. Unify financial, regulatory, managerial and operational data in a single repository across multiple systems. Eliminate redundant data aggregation for easy analysis down to the lowest   level of detail. Reduction of memory footprint through elimination of redundancy. Unite OLTP and OLAP together for simplified landscape, processes, and analysis.

6. Seamless Access

Self-service access to transactions and analytics anywhere, at any time. Past, present and future analysis at your fingertips to answer tough questions in briefings and meeting.

7. Modern User Experience

State-of-the-art user experience using the latest technology innovations. Intuitive end user training interfaces and guided processes eliminate complex teaching undertakings. Customize templates for event-driven closing tasks and collaboration.

8. Compliance You Can Count On

Efficiently meet the demands of complex compliance regulations. Generate high-quality financial statements and management reports required by international and local reporting standards.

9. Boundless Extensibility

Unlimited potential to extend system to customer’s specific business needs.

10. Foundation for Finance Transformation and Innovation

A seamless path to your finance transformation. Choose your path towards finance transformation with real-time software available in on-premise, cloud or hybrid options.

RECONCILIATION FUNCTIONALITY IN SAP ERP

EXECUTE ENTITY CLOSE TASKS

FINANCIAL CLOSING COCKPIT ON FIORI

⊕   Cockpit to monitor the progress of the entity close via KPIs, also on a mobile device

⊕   Analyze the completion rate of closing tasks by multiple dimensions like region, country, company, milestone, working day, etc

⊕   Monitor the tasks delayed or in error with easy collaboration to respective task owners

⊕   Analysis of historic closing cycles

Source : SAP ™

End to End data flow on SAP Fiori – Architecture defined in 5 Minutes

Account Determination – FI – MM integration on Fiori App

Account Determination – FI – MM integration on Fiori App

https://www.linkedin.com/pulse/account-determination-fi-mm-integration-fiori-app-maydipalle-

S4 FINANCE – FIORI

SAP Fiori apps reference library..!!

https://fioriappslibrary.hana.ondemand.com/sap/fix/externalViewer/#

Click on below mentioned link (spreadsheet) to view complete list of Fiori apps available in S4 FINANCE 1511 and 1610 versions.

S4 FINANCE 1610 Fiori Apps

Key Features on S/4 HANA FINANCE

Click on below mentioned link to see new Innovations on SAP S/4 FINANCE

Key Features on S/4 HANA FINANCE

Thank You

Jayanth Maydipalle

System Conversion to S/4HANA FINANCE

For detailed information on the conversion process, please follow the below mentioned SAP SNotes.

S Notes
2390881	Consistency checks before the installation during the migration to Asset Accounting (new)
2332030	Conversion of accounting to SAP S/4HANA
2333236	Composite SAP Notes: Enhancements and message texts for the program RASFIN_MIGR_PRECHECK
1939592	SFIN: Pre-Check Report for migrating to New Asset Accouting
2180591	Currencies in FI-GL and FI-AA are inconsistent
2147666	Assigned ledgers in FI-GL and FI-AA are inconsistent
2105948	Check report for Financials add-on
1968568	Release Scope Information: SAP Simple Finance add-on 1.0 for SAP Business Suite powered by SAP HANA
2220152	Ledger approach and Asset Accounting (new): Non-calendar fiscal year variant for parallel valuation
2023763	SFIN: check old dc engine and parallel currency in precheck report RASFIN_MIGR_PRECHECK
2246638	Check parallel areas in ANLB is mssing in Precheck
2226973	sFIN: Period scaling does not correspond to the definition AFASL
2353504	ACC_AA 173 not issued in case of incorrect configuration
2359854	Precheck: No message handling when checking periodic APC posting
1976487	Information about adjusting customer-specific programs to the simplified data model in SAP Simple Finance
2186803	SAP Simple Finance, OP: Treatment of NewGL tables and customer enhancements
2160045	S/4HANA Finance: Fields of Appends to COEP and BSEG missing in table ACDOCA
2076652	SAP Simple Finance: SAP Note for adjustment of customer-specific programs for aging
2105948	Check report for Financials add-on
2408083	FAQ: Data Model of S/4HANA Finance Data Migration
2431747	General Ledger: Incompatible changes in S/4HANA compared to classic ERP releases

Steps to remember for the Conversion:

Preparation of Data

Before starting system conversion, get system ready by performing the following activities:

⇒ Check the consistency of your financial data and perform reconciliation between your accounting components, so the data can be merged correctly in the universal journal entry. In SAP S/4HANA all line item documents are stored in the universal ACDOCA data table.

⇒ Perform period-end closing including the storage of reporting key figures and closing the posting periods.

• Lock the current and previous periods in Materials Management using program RMMMPERI.
• Perform closing for periodic asset postings using program RAPERB2000.
• Execute the periodic depreciation posting run using program RAPOST2000.
• Make sure that all held documents have either been posted or deleted.
• If you are already using account-based profitability analysis, perform a delta upload to SAP BW for all account-based CO-PA DataSources for which you use the delta method.

⇒ Document the posting data. Make sure that all carry forward balances are complete and consistent. To ensure this, carry forward the balances for all currencies and all ledgers.

⇒ Archive any data that you no longer need in every day business processes before the migration.

⇒ If you have not been using the new depreciation calculation from the Enterprise Extension Financials Extension (EA-FIN) you must implement it as part of a separate project.

Prepare Asset Accounting

Activate the new depreciation calculation in your source system. To do so you must activate the EA-FIN business function.

Perform Pre-Checks

 ⇒ Pre-Checks help you identify the steps you need to take to ensure your system is compatible with the conversion process.

⇒ The Controlling and General Ledger pre-checks provided analyze whether your ledger, company code and controlling area settings are consistent and can be migrated to SAP S/4HANA. These Controlling and General Ledger pre-checks are automatically executed when you run the report R_S4_PRE_TRANSITION_CHECKS.

⇒ To run pre-checks for Asset Accounting (FI-AA), please implement the SAP Notes listed in the collective SAP Note 2333236. The pre-check program for Asset Accounting (FI-AA) is not included in the central pre-check report R_S4_PRE_TRANSITION_CHECKS. To execute the appropriate pre-checks for Asset Accounting, please run the report RASFIN_MIGR_PRECHECK.

⇒ Whereas you run the report R_S4_PRE_TRANSITION_CHECKS in client 000 to perform the checks across all clients, then run the report RASFIN_MIGR_PRECHECK in each productive client.

Thank You

Jayanth Maydipalle

GST – India

CGST means the tax levied under the Central Goods and Services Tax Act, 2016.

IGST means the tax levied under the Integrated Goods and Services Tax Act, 2016.

SGST means the tax levied under the State Goods and Services Tax Act, 2016.

Listed below are the important GST SNOTES released by SAP-INDIA

2419215	GST IN: Changes for FI Invoice item level screen
2419214	GST IN: Changes to MIRO Invoice item level screen
2417506	GST India – Utilities
2415115	GST India – Changes to Transaction data- Data Dictionary activities
2410917	GST IN: Line item wise tax calculation for sales invoices
2410105	GST IN: Sales related changes for India GST for sales order creation and Invoice posting
2385575	GST India – Changes to Master data
2378678	GST IN: BAdI implementation in Enjoy transactions of FI and MM
2252781	FAQ on Tax procedure migration from TAXINJ to TAXINN
1175384	Minimum Support Package(SP) level to obtain support for legal change in India Logistics and Indirect taxes(CIN)
2428495	GST India: Corrections to note 2416018
501054	FAQ: Taxes in purchasing
2014164	TAXINJ to TAXINN Migration
2421394	GST India: Pre-requisites/FAQs/Solution

Thank You

Jayanth Maydipalle

ACDOCP on S/4 FINANCE

SAP S/4 Finance, 1610 has ACDOCP table for Planning, which has a similar structure to ACDOCA. SAP Plans to switch all CO objects to update ACDOCP and it would be the “Single Source” for planning data. COSP/COSS tables will be replaced with ACDOCP in future.

ACDOCP will gradually expand to cover “Period based planning” i,e General ledger Planning, Cost Center Planning, Project/WBS planning and Profitability Planning etc.

The Object based plans that for Projects, Sales orders, Productions orders will write into ACDOCP in future.

ACDOCA and ACDOCP  will bring the actual and the planning together all in one single source of truth.

Thank You

Jayanth Maydipalle

Create Bank Accounts on Fiori / NWBC

Below mentioned Roles are required to activate “Manage bank accounts” app on Fiori.

The user must be assigned with role:

• SAP_BR_CASH_SPECIALIST (for On-premise Edition)
• SAP_BCR_FIN_CM_BAM_MC (for Cloud Enterprise Edition)
• SAP_BCR_FIN_CM_BANK_ACC_MGM (for Cloud Project Services Edition)

Back-End Server: Activate Web Dynpro Application:

Component: Web Dynpro Application

Technical Name: WDA_FCLM_BAM_HIERARCHY

Use transaction “SICF” and make sure that the ICF service for the Web Dynpro application is activated.

Back-End Server: Assign Role with Start Authorization for Web Dynpro Application:

Component: Back-End Role

Technical Name: SAP_SFIN_CASH_MANAGER

The Manage Bank Accounts transactional app provides an overview of your bank accounts in a hierarchical structure and allows you to maintain bank account master data according to your organization’s business requirements, as shown in

Activating transfer prices/multiple valuation approaches

Note:
After you activate the multiple valuation approaches/transfer prices, it is not always easy to deactivate them again.
Currencies and valuations determine the functions of the transfer prices. In the currency and valuation profile, you must determine which valuation approaches are managed in which currencies. The legal valuation approach must be managed in the company code currency (currency type 10). You can decide whether the profit center and the group valuation approach are managed in the company code currency or in the group currency. To ensure a consistent update of the data, it is absolutely essential to use currency type 30 or currency type 10 as the controlling area currency in cases where there is an N :1 relationship between the company code and the controlling area. SAP Reference IMG > Controlling > General Controlling > Multiple Valuation Approaches/Transfer Prices > Activation > Set Up Transfer Prices in a Production.

Activities to be followed:
The following settings are essential in order to work with multiple valuation approaches.

• Currency and valuation profile

  Using the currency and valuation profile, you must decide which valuation approaches you want to manage in the system. You can manage a maximum of three valuation approaches in two currencies in parallel. All valuation approaches that you maintain in the currency and valuation profile must also be managed accordingly in the material ledger. You can only execute a profit center valuation if you are using Profit Center Accounting. If you have defined the currency and valuation profile, you must assign this to a controlling area.
  Customizing -> SAP Reference IMG > Controlling > General Controlling > Multiple Valuation Approaches/Transfer Prices > Basic Settings > “Maintain Currency and Valuation Profile” and “Assign Currency and Valuation Profile”.

• Create versions for valuations

  In Controlling, the multiple valuation approaches are saved in the CO versions. As long as you are not using any transfer prices in accounting, use a current version “000” in the legal valuation. If you are using transfer prices, the operational version “000” saves all of the data (full version). The data of the multiple valuation approaches defined in the currency and valuation profile are stored in delta versions, which you must create.

  The operational version represents the main Controlling approach that is used to control the company. You now need to define which valuation is managed in which version. You can decide whether the version “000” is managed in the legal valuation or in a parallel valuation. As a rule, you will manage the legal valuation in the version “000”. This setting is executed at controlling area level. You can check the consistency of the settings using the “Valuation” button. Customizing > SAP Reference IMG > Controlling > General Controlling > Multiple Valuation Approaches/Transfer Prices > Basic Settings > Create Versions for Valuations. If the version “000” is used to manage the legal valuation, this means that the sum total of the values from version “000” plus the delta version you created gives the transfer price.

• Material ledger

  The material ledger (ML) provides a subledger for materials management. It forms the basis for managing multiple valuation approaches (ML manages the parallel inventory values) and MUST therefore be activated. First, you must set the material ledger to active in ML Customizing for the valuation areas. This tells the system that you intend to work with ML in the future. Important: You MUST activate the ML for ALL valuation areas/plants in all company codes of the controlling area in which the multiple valuation approach/transfer prices are to be activated.

  Note: Do not make any postings in Materials Management (MM) and avoid other postings that refer to the ML until you reach the “Set valuation areas as productive” process step (see below)

  You must then use the material ledger type to define the currency types you want to use in the material ledge. These currency types must correspond with those from the currency and valuation profile. If the currency and valuation profile only has two multiple valuation approaches (for example, a legal valuation approach and a profit center valuation approach), you can use the third currency field to maintain another currency. You must then assign the material ledge type to a valuation area.

  Customizing -> SAP Reference IMG > Controlling > Product Cost Controlling > Actual Costing/Material Ledger, or Customizing > SAP Reference IMG > Controlling > General Controlling > Multiple Valuation Approaches/Transfer Prices > Basic Settings > Check Material Ledger Settings.

• Transfer prices in Profit Center Accounting (PCA)

  a) Setting the profit center valuation in the currency and valuation profile is only useful if Profit Center Accounting is active. In the Customizing settings for Profit Center Accounting, you define which valuation approach is used in PCA at the level of the controlling area. If you decided, in the currency and valuation profile, to work with the profit center valuation approach, you MUST select the profit center valuation approach in PCA. Otherwise, you can choose freely between the legal valuation approach and the group valuation approach. Note that, in Profit Center Accounting (PCA), you can only ever manage ONE valuation approach, in other words, the legal approach is no longer available in PCA if you are using the profit center valuation. (The local currency then corresponds to the currency type 12). If you require the update of the legal values to be structured according to profit centers in parallel, this must be executed in parallel in an FI-SL ledger with a structure that corresponds to PCA ledger 8A.
  Please also note that, if the transfer prices are activated, it is not possible to update the transaction currency.
  Customizing > SAP Reference IMG > Enterprise Controlling > Profit Center Accounting > Basic Settings > Maintain Settings for the Controlling Area.

  b) For the settlement with transfer prices, price determination must be set. Maintain the transfer price variant, the pricing procedures and the conditions. Create condition records for the transfer price conditions. For actual postings, only the transfer price variant “000” can be used.

  Customizing > SAP Reference IMG > Enterprise Controlling > Profit Center Accounting > Transfer Prices > Basic Settings for Pricing and Advanced Settings for Pricing.

  In order to analyze the transfer pricing during the activation phase or to detect incorrect settings, use the indicator “Condition Analysis” (Customizing -> … Basic Settings for Pricing and Advanced Settings for Pricing). This indicator activates the analysis for the entire system. Alternatively, you can set the SET/GET parameter DIA to X in the user master record, which activates the analysis for each user.

  c) Define accounts for internal goods movements

  As a result of settlement with transfer prices, additional postings are required in Profit Center for internal revenues, internal costs and changes in stock in order to ensure correct mapping. You must specify the accounts under which these postings are to be made.

  Customizing > SAP Reference IMG > Enterprise Controlling > Profit Center Accounting > Transfer Prices > Settings for Internal Goods Movements > Account Determination for Internal Goods Movements.

  d) Define account for production variances

  When you use transfer prices for cross-plant production, a special account is required in order to settle production variances to the sending profit center rather than to the receiving profit center.

  Customizing > SAP Reference IMG > Enterprise Controlling > Profit Center Accounting > Transfer Prices > Settings for Internal Gods Movement > Account Determination for Prod. Varian.

  e) Define valuation approach clearing account

  When using multiple valuation approaches/transfer prices, receivables and payables are only posted in the legal valuation view because the payment is made in this amount. However, if different valuations are posted for the offsetting account, the difference must be posted in valuation approach clearing accounts if it is to be reported in the consolidated financial statements. Maintain the valuation approach in Customizing -> SAP Reference IMG > Controlling > General Controlling > Multiple Valuation Approaches/Transfer Prices > Define Valuation Approach Clearing Account.

• Activate transfer prices

  Activation of the currency and valuation profile represents the final step in the required Customizing settings. The currency and valuation profile must not be activated until you have made all of the Customizing settings required for the activation. Use the check function beforehand. Customizing -> SAP Reference IMG > Controlling > General Controlling > Multiple Valuation Approaches/Transfer Prices > Activation > Multiple Valuation Approaches: Check/perform the activation.

• Set the valuation areas as productive.

  In this step, set the valuation areas that correspond to the plants as “productive”.
  Menu > Accounting > Controlling > Product Cost Controlling > Actual Costing/Material Ledger > Environment > Production Startup > Set Valuation Areas as Productive.

Optional activities
Depending on your requirements, individual applications can now be included in the transfer price solution. The applications mentioned below are data-receiving modules and therefore do not affect inventory management or the results of the various valuation approaches For this reason, these modules can also be optionally provided with the data from the multiple valuation approaches.

• Transfer prices in product cost planning

The multiple valuation approaches in the material ledger can either be maintained manually or determined using product cost planning. Product Cost Planning offers the option of determining standard costs for each valuation approach (legal, group, profit center) and updating these in the ML For this reason, as of Release 4.0, three costing variants can be created in Customizing, which can determine the costs in each valuation approach and update the standard prices using the usual logic (allow marking, marking, allow release, release) from the corresponding views in the ML. The costing variant is assigned a costing type, which determines which valuation approach costing is carried out. The costing type similarly determines whether the standard price of the corresponding valuation approach can be updated by the costing variant.

Customizing -> SAP Reference IMG > Controlling > Product Cost Controlling > Product Cost Planning > Material Cost Estimate with Quantity Structure > Define Costing Variants and Costing Variant: Components > Define Costing Types.

When calculating the values for the profit center valuation approach, you need to take account of pricing when you change the profit center, as you would in the actual allocation. In the “Quantity Structure” folder, set the indicator for costing across profit centers. The costing version controls which transfer price variant from Profit Center Accounting is to be used as part of costing. Customizing > SAP Reference IMG > Controlling > Product Cost Controlling > Product Cost Planning > Selected Functions in Material Costing > Define Costing Versions.

The group costing saves the valuation differences from the legal and profit center valuations in additional cost components for the cost of goods manufactured. You must create these cost components for the cost of goods manufactured in addition to the usual cost components. You must also identify them as such on the detail screen for cost components for the cost of goods manufactured using the field “Delta Company Code” or “Delta Profit Center” field. Customizing > SAP Reference IMG > Controlling > Product Cost Controlling > Product Cost Planning > Basic Settings for Material Costing > Define Cost Component Structure.

In this step, you specify that the cost components of the material costing, sales order costing or order BOM costing are to be updated both in the currency of the company code, and in the currency of the controlling area. This processing requires that the indicator “All Currencies” is set as the control indicator for the controlling area. Customizing -> SAP Reference IMG > Controlling > Product Cost Controlling > Product Cost Planning > Selected Functions in Material Costing > Activate Cost Component Split in Controlling Area Currency.

• Transfer prices in Financial Accounting

  In Financial Accounting, you have the option of managing additional multiple valuation approaches. The management of additional valuation approaches in financial accounting is handled the same way as the management of additional local currencies. The additional currencies that are managed are also assigned the dimension valuation. The legal valuation approach in the company code currency is mandatory because it is a prerequisite for the legal inventory valuation and thus for the legal settlement. If you decide to work with additional valuation approaches in Financial Accounting, the Customizing of the “additional local currency” must be set up in the basic settings in financial accounting for the relevant company codes. Here, you define which additional valuation approaches are updated and specify the additional ledgers in which the aggregated data is updated. The additional value approaches created in financial accounting must be the same as the valuation approaches stored in the currency and valuation profile. The consistency of the settings is checked when you activate the parallel valuation approaches. Customizing -> SAP Reference IMG > Financial Accounting > Financial Accounting Global Settings > Company Code > Parallel Currencies > Define Additional Local Currencies or Define Additional Local Currencies for Ledgers.

Benefit: FI transfers the currency translation for the parallel currencies and supplies PCA with lines in profit center valuation. The currency fields KSL and, if necessary, HSL are then transferred directly from the values delivered and do not have to be calculated in Profit Center Accounting. Basically, a calculation is only required if the currency types or currencies from the delivered currency lines do not match the settings in PCA (transaction 0KE5).
Advantage/disadvantage: The multiple valuation approaches are part of the FI document and are visible from the display of the FI document (transaction FB03) via the “Display Currency” button.
Advantage/disadvantage: For each additional valuation approach maintained in the parallel FI local currencies, a separate depreciation area MUST be created in Asset Accounting.
We recommend that you maintain the base currency 2 “Conversion from the first local currency” for the multiple valuation approaches. As amounts in multiple valuations are also always converted automatically using the exchange rate type ‘M’ in many SAP applications , you should similarly always maintain the exchange rate type ‘M’ in transaction OB22 for multiple valuation views.

• Transfer prices in Asset Accounting

If additional valuation approaches are managed in Financial Accounting, these MUST also be managed in Asset Accounting. For each additional valuation approach in Asset Accounting, you must create a separate valuation area. The valuation type is assigned a currency type, which defines the currency and the valuation
Customizing > SAP Reference IMG > Financial Accounting > Asset Accounting > Valuation > Depreciation Currencies > Define Parallel Currencies.

• Transfer prices in the profitability analysis.

Transfer prices in the profitability analysis are available only as of Release 4.5. Activating profit center valuation allows internal sales between profit centers (for example, stock transfers between two plants or material withdrawals) to be analyzed at transfer prices in the profitability analysis in addition to external sales. When you activate the profit center valuation, line items with profit center valuation are created in addition to the valuation approaches with legal valuation. As a result, the data volume is roughly doubled during the actual data update. However, the number of profitability segments remains unchanged.

a) In the Customizing settings for maintaining the operating concern, you define whether the profit center valuation is managed in CO-PA as an additional valuation approach When you generate the operating concern, the required data structures are then created for this. Customizing > SAP Reference IMG > Controlling > Profitability Analysis > Structures > Define Operating Concern > Maintain Operating Concern.

b) The group valuation approach is managed in the data structures of the legal valuation in additional value fields. To control the costs and revenues in the different view separately, you must create additional value fields and assign them to the data structures. The field contents must be filled using the CO-PA user exit, as an entry using value field assignment is not possible. The profit center valuation in updated in a separate ledger. No separate value fields are required.

c) Activate the partner profit center for use. Customizing > SAP Reference IMG > Controlling > Profitability Analysis > Structures > Segment-Lvl Characteristics.

d) Assign the value fields of the profitability analysis to the accounts for internal goods movements between profit centers (from transaction 0KEK). The quantities of the internal goods movements can similarly be transferred into the corresponding quantity fields. Customizing > SAP Reference IMG > Controlling > Profitability Analysis> Flows of Actual Values > Parallel Valuation Approaches/Transfer Prices > Assign Accounts for Internal Goods Movements.

e) Assign the SD conditions to the corresponding value fields in Profitability Analysis. Customizing > SAP Reference IMG > Controlling > Profitability Analysis > Flows of Actual Values > Transfer of Billing Documents.

f) The profit center valuation in profitability analysis must be activated for each controlling area. Customizing > SAP Reference IMG > Controlling > Profitability Analysis > Flows of Actual Values > Parallel Valuation Approaches/Transfer Prices > Activate Profit Center Valuation.

• Transfer prices in sales and distribution

Multiple valuation approaches can be used both for sales to external customers and for cross-company code sales with affiliated companies. For this purpose, you must include the condition types with the relevant control in the pricing procedures. The following condition types are provided:

Condition category “b” for conditions used to determine group production costs. The value from the material ledger is automatically read in the group valuation. Condition type delivered in the standard system: KW00.

Condition category “h” for conditions used to determine the profit center production costs. The value from the material ledger is automatically read in the profit center valuation. Condition type delivered in the standard system: PCVP.

Condition category “c” for the conditions used to determine the profit center prices. It is necessary to define the relevant prices. Condition type delivered in the standard system: PC00.