SAP CO.ppt

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Learning SAP CO

Controlling (CO)

PRAKASH

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Learning SAP CO

Agenda

Overview on SAP Controlling

Business process under Overhead cost accounting

Business process under Product costing

Business process under Proftabilit analsis

Course Content Road!ap " #ob Opportunities

$"A Session

%&clusive Course designed 'or Basic and Advanced SAP CO Co

PRAKASH

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Overview on SAP ControllingPRAKASH

Controlling provides you with information for management decision

It facilitates coordination monitoring and optimi!ation of all procesorgani!ation.

"his involves recording #oth the consumption of production factors services provided #y an organi!ation.

As well as documenting actual events the main task of controlling i

$ou can determine variances #y comparing actual data with plan da

"hese variance calculations ena#le you to control #usiness %ows.

Income statements such as contri#ution margin accounting are usethe cost e&ciency of individual areas of an organi!ation as well as torgani!ation.

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ntegrationControlling 'CO( and )inancial Accounting ')I( are independent components in t

"he data %ow #etween the two components takes place on a regular #asis.

"herefore all data relevant to cost %ows automatically to Controlling from )inaAccounting. At the same time the system assigns the costs and revenues to diaccount assignment o#+ects such as cost centers #usiness processes pro+ectsrelevant accounts in )inancial Accounting are managed in Controlling as cost erevenue elements. "his ena#les you to compare and reconcile the values from )inancial Accounting.

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eatures

Cost %le!ent Accounting (CO*O+*C%,)

Cost Center Accounting (CO*O+*CCA)

nternal Orders (CO*O+*OPA)

Product Cost Controlling (CO*PC)

Proftabilit Analsis (CO*PA)

Proft Center Accounting (%C*PCA)

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Cost ,lement Accounting is the area of cost accounting where you track and structure the co

a settlement period. It is thus not an accounting system as such #ut rather a detailed record

forms the #asis for cost accounting.

ntegration

In an integrated accounting system such as the SAP system you do not need to enter cost d

is #ecause each #usiness transaction that involves costs updates the CO component with de

on the cost element and on the account assignment o#+ect itself. ,ach consumption transact

anagement '( each #illing in Sales and istri#ution 'S( '/ revenue( and each e0terna

invoice veri1cation %ows directly through the 23L Account '/ cost element( to the correspon

assignment o#+ect.

)eatures

$ou can restrict the entry of cost data to part of the valuation di*erences and additional cost

transfer depreciation costs from Asset Accounting for the depreciation of 10ed assets for e0a

use accrual calculation in cost accounting for management income.

Cost accounting in the system also has the task of identifying the costs incurred in su#areas

and tracing the cost %ows. "he system provides complete information on the costs for all typ

assignment o#+ects 'such as cost centers orders and pro+ects(.

)or cross-company-code or cross-#usiness-area cost accounting the cost %ow in Controlling

reconciliation #etween internal and e0ternal accounting. "he necessary reconciliation is also

Cost and 6evenue ,lement Accounting.

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Cost Center Accounting (CO*O+*CCA)

$ou use Cost Center Accounting for controlling purposes within your organi!ation. "he costs incurre

organi!ation should #e transparent. "his ena#les you to check the pro1ta#ility of individual functio

decision-making data for management. "his re5uires that all costs #e assigned according to their s

source-related assignment is especially di&cult for overhead costs. Cost Center Accounting lets yo

overhead costs according to where they were incurred within the organi!ation.

ntegration "he costs of each cost-accounting-relevant #usiness transaction portrayed in the system through cthrough Cost and 6evenue ,lement Accounting 'CO-O-C,L( to an account assignment o#+ect in thcomponent 'CO(. )or overhead costs this can #e cost centers internal orders #usiness processes 6ecording and assigning overhead costs allows you to control costs and prepare information for theCost Accounting.

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nternal Orders (CO*O+*OPA)

Internal orders are normally used to plan collect and settle the costs of internal +o#s and tasks. "h

you to monitor your internal orders throughout their entire life-cycle9 from initial creation through t

posting of all the actual costs to the 1nal settlement and archiving:

eatures

; $ou can use master data to assign certain characteristics to your internal orders which ena#les yo

#usiness transactions can #e used with the internal order.

; Internal order planning ena#les you to roughly estimate the costs of a +o# #efore the order starts a

calculation at a later date. $ou can choose #etween various planning approaches to compare the e*

methods.

; $ou can assign and manage #udgets for internal orders.

; $ou apply the actual costs incurred #y a +o# to your internal orders using actual postings. In )inanc

can assign primary cost postings 'such as the procurement of e0ternal activities and e0ternal delive

internal orders.

; In period-end closing you can use various di*erent allocation methods 'for e0ample overhead cos

#etween di*erent areas of Cost Accounting.

Order settlement ena#les you to transfer the costs incurred #y an order to the appropriate receivers

; "he information system for internal orders ena#les you to track planned and assigned costs on yo

of the order life-cycle.

; $ou can archive internal orders that you no longer re5uire. See Archiving.

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Product costing

Product Cost PlanningCost Ob-ect Controlling (CO*PC*OB#)

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Product Cost Planning

Product Cost Planning 'CO-PC-PCP( is an area within Product Cost Controlling 'C

can plan costs for materials without reference to orders and set prices for mat

cost accounting o#+ects.

$ou can use Product Cost Planning to analy!e your product costs such as for:

•anufactured materials

•Services

Analy!ing product costs helps provide answers to 5uestions such as:

•4hat is the value added of a particular step in the production process<

•4hat proportion of the value added can #e attri#uted to a particular organi!at

•4hat are the material production and overhead costs<

•8ow can production e&ciency #e improved<

•Can the product #e sold at a competitive price<

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Cost Ob-ect Controlling (CO*PC*OB#)

Cost O#+ect Controlling is an area in cost accounting that ass

costs incurred in the production of company activities 'such amanufactured in-house( to those activities. It supports you in

•6eaching make-or-#uy decisions

•etermining price %oors

•Performing comple0 cost analysis 'such as target3actual ana

•etermining inventory values

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Structure

Cost O#+ect Controlling is divided into the following components:

•Product Cost b Period

"his component is used for recurring periodic cost control of products that are

the same way over an e0tended period of time.•Product Cost b Order

"his component is mainly used to analy!e the costs of individual production lo

•Product Cost b Sales Order

"his component lets you collect and analy!e costs in comple0 make-to-order p

customer-speci1c services.

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Proftabilit Analsis (CO*PA)

Pro1ta#ility Analysis 'CO-PA( ena#les you to evaluate market segments which

classi1ed according to products customers orders or any com#ination of these

#usiness units such as sales organi!ations or #usiness areas with respect to y

pro1t or contri#ution margin.

"he aim of the system is to provide your sales marketing product managemen

planning departments with information to support internal accounting and deci

"wo forms of Pro1ta#ility Analysis are supported: costing-#ased and account-#a

•Costing-#ased Pro1ta#ility Analysis is the form of pro1ta#ility analysis that gro

revenues according to value 1elds and costing-#ased valuation approaches #o

can de1ne yourself. It guarantees you access at all times to a complete short-t

report.

•Account-#ased Pro1ta#ility Analysis is a form of pro1ta#ility analysis organi!ed

and using an account-#ased valuation approach. "he distinguishing characteris

is its use of cost and revenue elements. It provides you with a pro1ta#ility repo

permanently reconciled with 1nancial accounting.

$ou can also use #oth of these types of CO>PA simultaneously.

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Proft Center Accounting (%C*PCA)

"he application ,C-PCA lets you analy!e internal pro1t and loss for pro1t centers. "his makes it pos

evaluate di*erent areas or units within your company. $ou can structure pro1t centers according to

o&ces plants( function 'production sales( or product 'product ranges divisions(. Pro1t Center Ac

component of the module ,nterprise Controlling.

,C-PCA can #e used #y companies in any #ranch of industry 'mechanical engineering chemical seand so on( and with any form of production 'repetitive manufacturing make-to-order manufacturin

manufacturing(. "he pro1t-relevant data is displayed #y period.

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Course Content Road!ap " #ob Opportunities

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$ " A Session

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SAP CO.ppt

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