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Attributed Profitability Segment in CO-PA: Concept and Int. Order Scenario in S/4 HANA 1809

In this blog post we will discuss the concept of Attributed Profitability Segment and learn how this is applied in Internal Order settlement to CO-PA.

Concept:

For income statement items without a true account assignment to a profitability segment (for example, items assigned to an order, WBS element, or sales order item), an attributed profitability segment can be determined when the journal entry is created.

The technical basis for Simplified Profitability (new term coined in S/4 HANA1809) Analysis is account-based profitability analysis. The profitability characteristics are determined through the operating concern and can be refined by the tools of profitability analysis. When the operating concern is generated, all characteristics not yet available, including customer-specific characteristics, are appended to the journal entry and filled during posting.

Activation of this functionality is possible for GL line items with the following account assignments

Object Activation by P&L Acc B/S Acc
Cost Center Cost Center Type Yes No
Internal Order Order Type Yes Yes
Project Project Profile Yes Yes
Sales Order Item Category Yes Yes
Production Order Order Type Yes Yes
Maintenance Order Order Type Yes Yes

This functionality was introduced for all the above objects (except Maintenance Orders) in SAP simple finance itself. This functionality has been extended to Maintenance Orders in S/4 HANA1809.

Attribution logic can be activated for the following GL Accounts:

  • Primary Costs or Revenue.
  • Secondary Costs.
  • Nonoperating Expenses or Income (Type N) in two special cases.
    • WIP Postings from transaction-based revenue recognition.
    • External settlement of Result Analysis data to FI.
  • Balance Sheet Accounts with Cost element type 90. (Except Cost Center).
  • Balance Sheet Accounts without cost element (Except for Cost Center).
    • WIP Postings from transaction-based revenue recognition.
    • External settlement of Result Analysis data to FI.

An attributed profitability segment is determined based on the fixed logic at the time the G/L line item is created. The requirement is to fill as many characteristics in the item as possible to enable maximum drill down analysis capability.

IMG – Master Data- Profitability Analysis – Master Data – Activate Derivation Items without Profitability Segment.

Both P&L Accounts and Balance Sheet Account can be activated for these objects. However, It is important to note that Balance Sheet Accounts cannot be activated for Cost Centers.

SAP developed a logic containing fixed set of rules to derive additional characteristics from the available data in the GL Line item. This logic depends on the account assignment of the item. Detailed logic is available in the sap help documentation.

Example

Let’s see an example of the derivation of attributed profitability segment using internal orders where a settlement rule for PSG exists. It is also possible to derive attributes without settlement rule when certain criteria exists in the Internal order. We are not going to discuss that here.

1. Internal Order with Settlement to PSG.

The only assignment on the Order is profit Center. Segment and Functional Area are assigned in the Profit Center.

Settlement Rule – This Order is settled to PSG.

I have added Material Number and Plant to the PSG in the settlement rule. When the GL Document is posted, System determines certain characteristics from Material Master and updates the PSG. We will see that below.

2. General Leger Document Posting

For the purposes of illustration, I have posted the following document using a P&L as an expense item on the Vendor Invoice.

As you can see, the only account assignment made on this document is Internal Order. Profitability Segment is not assigned while Document creation.

Drill down into the second line (P&L) item of the posted document to see how the PSG data is populated.

As you can see, Plant and Product is copied over to Document from the settlement Rule. In addition, system also derived Division and Material Group from Product.

3. Reports and Table Data

Now let’s look at the ACDOCA Table to verify the data.

The profitability Segment characteristics are not updated in CO-PA Yet. For them to appear in CO-PA, the Internal Order must be settled.

Well, Data is there in the table but is there any standard GL report that can pull these characteristics for analysis? A report like that is desired, especially because these attributes will not be available in CO-PA till the end of the month, when settlement is carried out.  I have investigated various standard GL Line item reports and Fiori Apps / tiles only to find that these are not made available. In all possibility a new Fiori App may need to be developed in order to get this detail in a report. I will update this article, after the investigation is concluded.

4. Settle the Internal Order:

Internal Order is settled – Accounting Document and Controlling Document are posted.

Order Settled with a settlement Cost Element.

5. COPA Line Item Report – KE24

Report shows all the attributes of the derived profitability.

Conclusion

In addition to income statement items which carry a true account assignment to a profitability segment, a profitability segment can be derived for additional income statement items and persisted in the journal entry. This is based on the “best-guess” principle, using the information that is available at that point in time. A refinement of the profitability characteristics at period end is still possible with the closing transactions such as settlement, allocation, and top-down distribution.

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