Profitability analysis and Management Accounting changes in Simple Finance (S/4 Hana 1511)

Hello Forum,

This documnet will give the functionalities offered by Simple finance in COPA and management accounting

The long pending requirement from the majority of the customers in manufacturing industry is getting the COGS break up each head wise and it needs to post to a different GL account, in this way COPA is in sync with FI and it reduces the lot of reconciliation issues, the same issue has been addressed in simplified profitability analysis and it is part of simple finance.

In CO the main focus is to reduce the month end closing activities time and increase the system performance, In Sfin we have a separate set of transaction codes to perform this activity.

• In simple finance, SAP is recommending for Account based COPA, account base in the default solution as the advantages of costing base has been incorporated in account base, as well enhancing the reconciliation aspect by having single document for Finance and COPA through universal journal entry, and improving the performance through the use of S/4 Hana database. No change in costing base approach.
• The COEP, COSS and COSP tables are replaced with ACDOCA.
• View tables are also available to reproduce the data in the old structure, for example V_COEP would allow seeing actual postings.
• Assessments with in CO will update the COEP for CO documents and accounting documents with ACDOCA
• Table ACDOCA would store both FI and CO posting in a unified document. As account based COPA posted is same as CO posting, the characteristic of account based COPA would also be part of ACDOCA

Configuration for splitting the cost of goods sold:

IMG: Spro > General Ledger Accounting (New) > Periodic Processing > Integration > Materials Management > Define Accounts for Splitting the Cost of Goods Sold

In Account Based COPA, there was no option to have a split of the Cost of Goods Sold into its components. This did not allow business to compare the component level costs of the inventory in terms of plan and actual, which can be basis of production re engineering. With Simple Finance, this option has been made available in account based COPA.

Configuration for additional quantities:

Spro > Controlling > General Controlling > Additional Quantities > Define Additional Quantity Fields

Additional quantity field can be configured. Badi FCO_COEP_QUANTITY has to be used.

In Simple Finance, the settings for Profitability Segment Characteristic is not supported any more, as each profitability segment contains all available characteristic values.

With Simple Finance, Integrated Business Planning would be in general used for overall Planning purpose. However planning available in account based COPA would continue to exist, as it exists before. But with additional flexibility IBP would be the primary Planning tool going forward.

For Reporting User Interface tools like Lumira would be used. This gives additional flexibility of query based reporting, real time value updation etc. However Ke30 reports can still be created.

With the simple finance, the benefits like reconciliation with financials, system performance, cost of goods sold and IBP is as follows.

Enhanced Real time functionality in CO month end closing:

Real-Time Overhead Calculation:

• Overhead Calculated as soon as entries posted at cost object, No need to execute period end overhead calculation transactions like KGI2 and CO43, Overheads will be calculated on the basis of costing sheet, System will create separate overhead document, recalculation and reposting of overhead is possible.

Variance Calculation for cost center:

• New T.code is  KSS1H, it serves the same functionality of T.code : KSS1 , no changes in Input and Output parameter.

WIP Calculation:

• New T.code: KKAOH, Accelerated WIP calculation (on actual cost ) can be done only  for production order. It does not support process order and product cost collector, available in new transaction code, for process order and product cost collector, business can still use existing transaction code, option to  select all RA Versions for WIP calculation is not available in new transaction code.

Production Variance Calculation:

• New  T.code : KKS1H, Variance calculation with target  0  will done on the fly  and it also provide variance category break up in GL accounting, all target Cost Versions , Alternative Material Cost Estimate and Primary price variances is not supported in new optimized transaction code.
• Now we can get the production variances each to a separate GL account, In classic R/3 all the variance categories will post to a single GL account, now we have the provision that break up of each variance category  will post to separate GL account.
  

Result Analysis for Sales Order:

• New  T.code: KKAKH, Same functionality of T.code: KKAK, no changes in Input and Output parameter, new transaction support only POC and Revenue RA method.

Internal Order Settlement:

New T.code : KO8GH, Same functionality of T.code : KO8G , no changes in Input and Output parameter, it will improves the system performance considerably in the month end.

Sales Order Settlement:

• New T.code : VA88H, Same functionality of T.code : VA88 , no changes in Input and Output parameter, It will accelerate  sales order settlement process.

Production Settlements:

New Optimized T.code: CO88H, Same functionality of T.code: CO88, no changes in Input and Output parameter, It will accelerate settlement process for production order, process order and Product cost collector.

For each transaction code the suffix H stands for HANA data base, By using these new transaction codes with HANA database the month end closing time has been reduced considerably and customer can get their month end financial statements very quickly.

I hope this document will give some inputs on COPA  and Management Accounting changes in simple finance, Happy learning and welcome your valuable comments.

Regards,

Ravi