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Author's profile photo Ugur Hasdemir

Enhancements in splitting the Cost of Goods Sold in S/4HANA 1809

In my previous post about Finance in S/4HANA 1809 I highlighted the innovations in Account Based Profitability analysis. One of the innovations is the enhancements in splitting the cost of goods sold. We will have a more detailed look at this new functionality in this blogpost.

What’s new in 1809?

In the previous release 1709 the COGS split functionality was already enhanced and new supported processes were added. In release 1809 the functionality for splitting based on Actual Costing is added.

Splitting based on Actual Costing

The splitting functionality based on actual costing is enabled in 1809. Now you can split the revaluation of COGS as well. Doing this you have 2 options. You can post the revaluated amounts to the same accounts under the same cost component structure. Or you can post the revaluated amounts to a specific cost component structure. The configuration is changed slightly to facilitate this. You can see the new checkbox in the print screen below.

Don’t forget to add your revaluation account in the “Source Account” sections of the customizing. This is the account configured in T030 account key COC.

Define Accounts for Splitting the Cost of Goods Sold


Perform the Split based on standard cost estimate

The standard cost estimate of the material used for preliminary costing during the period:

Create Material Cost Estimate with Quantity Structure


Sales order and delivery process

The splitting of the Cost of Goods sold during goods issue is a functionality which already available. You will see the enhanced functionality with splitting based on actual costing following the below example.

Posted accounting document during Goods Issue based on initial costing run:

Sales Order Delivery
Goods Issue Posting
Goods Issue COGS Split

The balances of the accounts in the financial statement App:

Display Financial Statement App

Alternatively, the amounts can be seen in the market segment analytics report as well:

Market Segment Actuals


Actual Costing and splitting the revaluation amount

In this example I have used a material valuated against standard price (S) with price determination Single Level/Multi Level (3). At month end I perform Actual Costing in CKMCLP:

Costing Cockpit Actual Costing
Costing Cockpit Actual Costing

There is a price difference of 2.45 USD:

Material Ledger Settlement
Material Ledger Settlement
Price Difference Posting
Price Difference Posting

As you can see the price difference of USD 2.45 is splitting based on the same cost component as the preliminary cost price.

Price Difference COGS Split
Price Difference COGS Split

The effect is visible in the Financial Statement app as well:

Price Difference in Financial Statement App


The benefits of having all dimensions on account level in ACDOCA is huge and the cons/disadvantages are disappearing with each new release. It is exiting to see that Account Based COPA is closing the gap.

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      Author's profile photo Hugo de Groot
      Hugo de Groot

      Hi Ugur, great accurate recap/explanation of this feature!

      I want to take this opportunity though to express that I don't like how SAP did implement this feature. I think the additional real-time "reclass" journal entry is UGLY.  Yes, this entry simplifies analytical reporting, but at the expense of clear, simple, accounting entries.

      Good luck explaining to users that the extra reclass entry is required because "this is how SAP works". Also, good luck explaining to users that they need to create an additional "technical" account in the chart of accounts (Consumption Valuation) because "this is how SAP works".

      (The older I get, the more I'm getting a fan of SIMPLE, and abstaining as much as possible from "technical" workarounds.)

      Author's profile photo Hai Dau
      Hai Dau

      Hi Hugo de Groot,

      SAP S4HANA provides offsetting account to original account in case you don't want to clear the original account. So basically, your entries would be the same as in previous SAP EPR version when you check balance/movement of inventory/COGS.

      Author's profile photo Lakhbir Singh
      Lakhbir Singh

      Hi Ugur

      This is a really useful information

      I just want to know how to activate the checkbox of Split at actual cost as in the system it comes greyed out

      thanks for sharing the information



      Author's profile photo Manuel Robalinho
      Manuel Robalinho

      Good information. Thanks

      Author's profile photo venu gopal
      venu gopal

      Hello Uger,

      What would be the way to find out only specific COGS splitting delivery documents in S/4 Hana.

      Ex: I have 1000 delivery documents, only 50 of them are having split after PGI documents

      I want to find out only thos documents.



      Author's profile photo Hai Dau
      Hai Dau

      Hi Venu, you can check if original COGS and splitting documents have same Reference key (BKPF-AWKEY)

      Author's profile photo Emiliano MANFREDI
      Emiliano MANFREDI

      Merciiii Uger


      Author's profile photo Manoj Kumar
      Manoj Kumar

      Hi Ugur Hasdemir,

      Thank you for the documentation.

      Do we need to maintain same source account  which we maintain in OBCY-COC? We have different Accout for COGS (GBB-VAX) and OBYC-COC; In that case do we need to maintain these accounts in Source account Configuration?