Sapbpc nw 10.0 consolidations ownership and minority interest calculations v2

________________________________________________________________________

Author: Chief Architect:

Sulthan Mohammad Jothi Periasamy

SAP EPM/BPC Project Lead/Manager/Architect SAP HANA/EPM/BI/EIM Community Thought Leader

SAP EPM Community Member SAP BPC/BOBJ/BW/MDM Community Domain Champion

[email protected] [email protected] , (916)-296-0228 - Cell

CloneSkills, Inc., http://www.CloneSkills.com , [email protected] , 1.800.836.8959, Page - 1

A SAP EPM Community Service

01/01/2012

SAP BPC NW 10.0 Knowledgebase

Consolidation on Investment Implementation Guide

� Ownership and Minority Calculation Implementation Guide, including � Consolidation Central (an out of the box powerful feature of BPC)

- Consolidation Monitor - Controls Monitor - Journal - Ownership Manager


________________________________________________________________________








01/01/2012

Table of Contents i. Business Scenario: .............................................................................................. 3

ii. Overview: ............................................................................................................... 3

iii. Implementation Steps: ....................................................................................... 12

iv. Create and Populate Dimensions & Model: ................................................... 12

v. Data preparation: ................................................................................................ 17

vi. Business Rules for Ownership Calculations: ................................................. 18

vii. Business Rules for consolidation: .................................................................... 20

viii. Logic Scripts:....................................................................................................... 27

ix. Data Input/ Reports: ........................................................................................... 28

x. Data Manager Packages: ................................................................................. 28

xi. Consolidation Building Blocks: ......................................................................... 29

xii. Ownership Calculations .................................................................................... 33

xiii. Elimination of Ownership – Purchase Method using .................................... 33

xiv. Consolidation Monitor ........................................................................................ 33

xv. Controls Monitor ................................................................................................. 39

xvi. Journal ................................................................................................................. 48

xvii. Appendix: ............................................................................................................. 51

xviii. Ownership Calculations: ................................................................................... 51

xix. Key Financial Terms .......................................................................................... 64

xx. Disclaimer: ........................................................................................................... 65

________________________________________________________________________








01/01/2012

Business Scenario:

Any corporation may have many legal subsidiaries and not all of them are wholly owned and managed by the holding companies. During a financial year, there may be fair number of acquisitions creates a tedious manual process to eliminate the ownership and book the minority interest for the closing. So there is a need a of automate process to take care of these ownership and to do minority calculations.

Overview:

This document illustrates every necessary step that is required to set up an Ownership and Consolidation on investment model in SAP BPC NW 10.0. A typical Ownership Manager process will have the following functionalities.

• Hierarchies are used to keep track of the parent-child relationships.

• The ownership model is used to store the ownership data. • The method definitions are configured in the business tables. • The method assignments are stored in the ownership model

In this guide, we will be looking at the following topics using the purchase consolidation method.

1. Ownership Calculations 2. Elimination of Investment 3. Elimination of Equity 4. Minority Interest Booking

________________________________________________________________________








01/01/2012

SAP BPC Consolidation Solutions Overview:

________________________________________________________________________








01/01/2012

________________________________________________________________________








01/01/2012

Implementation Steps:

Create and Populate Dimensions & Model:

1. Log into Web Admin Client using Primary Admin account (or any account with necessary task profile access that can create Model/Dimension and other building blocks)

________________________________________________________________________








01/01/2012

2. Click on “Planning and Consolidation Administration” option at the lower right corner

________________________________________________________________________








01/01/2012

3. Create all the following dimensions for the Ownership Model.

4. The account dimension members are as follows.

________________________________________________________________________








01/01/2012

5. Create the following ownership model. There should not be any intercompany member and “I_NONE” is selected. The values in the PARENT_GROUP property will be used to form the ownership hierarchy for the ownership manager.

________________________________________________________________________








01/01/2012

6. Create the following dimensions for Legal Consolidation model.

________________________________________________________________________








01/01/2012

Data preparation:

1. Go to EPM add-in excel and create the following input schedule to enter data for the percent ownership and percent control.

________________________________________________________________________








01/01/2012

Business Rules for Ownership Calculations:

1. Go to Administration/Business Rules, click on “Methods”.

________________________________________________________________________








01/01/2012

2. Enter the following data for the method table. The share range and the percent consolidation are used in the system to propose the method of calculation. Note: 0.75<,<=1.00 is interpreted as Greater than .75 but less than or equal to 1.00.

________________________________________________________________________








01/01/2012

Business Rules for consolidation:

1. Now click on Method Based Multipliers and create the rule RULE10 with the following values.

a. This rule will be used to select entities with method code assignments of 86 and intercompany members with any (99) method code.

b. 100% (1) of the source value will be written to the ALL

account specified in the eliminations and adjustments business rule.

c. The POWN % of the source value will be written to the Group account specified in the eliminations and adjustments business rule.

d. The 1-POWN % of the source value will be written to the Minority account specified in the eliminations and adjustments business rule.

Note: The ALL formula will reverse the sign of the source values while the Group and Minority formulas will not.

________________________________________________________________________








01/01/2012

2. Create the RULE60, method-based multiplier as follows.

________________________________________________________________________








01/01/2012

3. Choose Elimination and adjustments for the consolidation model as follows.

________________________________________________________________________








01/01/2012

4. Create ELIMINVEST rule id and fill in the data for both General & details as follows.

Choose RULE60 from Method-Based Multiplier. The source and destination accounts are same.

________________________________________________________________________








01/01/2012

5. Create ELIMEQTY rule id and fill in the data for both General & details as follows.

________________________________________________________________________








01/01/2012

Choose RULE10 from the multiplier and the source and destination accounts are added as given below.

6. Create ELIMMRTY rule id and fill in the data as given below for both General and Detail tabs

________________________________________________________________________








01/01/2012

Choose RULE 10 for the multiplier and assign source account and destination to minority as given below.

________________________________________________________________________








01/01/2012

Logic Scripts:

1. The following standard logic script is called from the Data Manager package. This has both currency translation and consolidation scripts. // Currency Conversion *RUN_PROGRAM CURR_CONVERSION CATEGORY = %O_CATEGORY_SET% GROUP=%SCOPE_SET% TID_RA = %TIME_SET% RATEENTITY = GLOBAL *ENDRUN_PROGRAM // Consolidation *RUN_PROGRAM CONSOLIDATION CATEGORY = %O_CATEGORY_SET% GROUP=%SCOPE_SET% TID_RA = %TIME_SET%

*ENDRUN_PROGRAM

________________________________________________________________________








01/01/2012

Data Input/ Reports:

1. The input form used for the investment elimination calculation is as follows.

Data Manager Packages: The process chain used for legal consolidation is

/CPMB/LEGAL_CONSOLIDATION

________________________________________________________________________








01/01/2012

Consolidation Building Blocks:

Consolidation Central

This module enables to generate and manage consolidated data. This is an all-in-one web interface for accountants. This gives an accurate view of the status of collected and consolidated data of an organization and is also a unified environment to perform consolidation tasks over the web. It is available under HOME tab has the following functions. Consolidation Monitor It’s a workspace for monitoring the consolidation progress for a specific consolidation scope for a given category, period, group or subgroup. The Consolidation Monitor displays the Group/Entity hierarchy created in the Ownership Manager for Consolidation type models. In the consolidation monitor we can see the status of the following.

� Controls Status � Work Status � Currency Translation status � Consolidation status

________________________________________________________________________








01/01/2012

Controls Monitor This is the place where user defined checks are performed to make sure the data entry or at subsequent points in the consolidation process to help ensure completeness and accuracy of the data. This is mainly used to control the consistency of the financial data, for example the balance sheet is balanced or not. Journals Journals work spaces are to record and make adjustments to data in the database. This is typically done as part of the month-end or quarter-end process. For example, administrators load general ledger information into a model using the Data Manager. Before the close, line managers can review the data and make adjustments as necessary using a journal entry. Journals Workspace Features: • List journal IDs • Select journals based on your context or advanced search criteria • Select columns to display

Ownership Manager

The Ownership Manager in the Consolidation Central module enables you to create and manage ownership-based hierarchies used for performing statutory consolidation.

________________________________________________________________________








01/01/2012

Ownership calculations are run from the ownership manager. An ownership based hierarchy combines Group and Entity members, where entities can be assigned to groups by Category and Time. Groups are nodes and entities are base level members. We define ownership based hierarchies in the system to set up and report on entity hierarchies that cannot be managed by a dimensional hierarchy.

________________________________________________________________________








01/01/2012

In the above example, USA is the holding company, the percent of ownership is 100% and it owns 70% of Australia. Australia owns 60% of China.

Security

The following tasks required for the consolidation processes.

________________________________________________________________________








01/01/2012

Ownership Calculations The ownership calculations specify a parent entity’s ownership interest in its subsidiaries, and the consolidation rates and methods to be applied. The steps followed for each ownership calculation process is explained in the appendix under “Ownership Calculations”.

Elimination of Ownership – Purchase Method using Consolidation Monitor

1. Log into EPM Add-in excel to enter data for the consolidation model using the following input form. In this guide we will address the consolidation of investment income for the following items using the purchase method. a. USA invests $80,000 b. Australia’s stock purchase is 20,000 c. China’s stock purchase is 30,000 d. The minority interest will be booked.

________________________________________________________________________








01/01/2012

2. Go to Home Tab, click consolidation central then click consolidation monitor.

3. Select the model at the right top corner and the context at the top of the screen as follows.

________________________________________________________________________








01/01/2012

4. To run the consolidation process, highlight the corporate level

group (World) and press consolidate.

5. In the following pop up window, make sure the context is correct and then select the option of Incremental or Full consolidation as follows. The incremental option is chosen whenever the entity’s transaction data is most recent than the last consolidation process. Then press okay in the pop up window.

________________________________________________________________________








01/01/2012

6. The following screen pops up when the process starts running. It shows the currency translation runs as first part of the consolidation, then the consolidation runs.

________________________________________________________________________








01/01/2012

7. After the successful completion of the consolidation, the status should as follows.

8. Now log in back to the EPM Add-in Excel and refresh the following input form. The report should display as given below. So what we learn from this is as follows.

a. The investment of USA (80,000) is adjusted to 0.

b. The stock purchase of Australia is adjusted to 0

c. The stock purchase of China is also adjusted to 0.

d. The minority interest for both Australia and China are booked

________________________________________________________________________








01/01/2012

________________________________________________________________________

Author:

Sulthan Mohammad

SAP EPM/BPC Project Lead/Manager/Architect

SAP EPM Community Member

[email protected]

CloneSkills, Inc., http://www.CloneSkills.com

Controls Monitor This process is used to identify if there is any inconsistency in the financial data by defining some user checks. In the following steps, we will see how to configure total assets & total liability.

________________________________________________________________________

Chief Architect:

Jothi Periasamy

/Architect SAP HANA/EPM/BI/EIM Community Thought

SAP BPC/BOBJ/BW/MDM Community Domain Champion

[email protected] , (916)-296-0228 - Cell

http://www.CloneSkills.com , [email protected] , 1.800.836.8959, Page - 39

This process is used to identify if there is any inconsistency in the financial data by defining some user checks. In the following steps, we will see how to configure in checking if there is any in-balance of total assets & total liability.

________________________________________________________________________

Thought Leader

Domain Champion

Cell

39


01/01/2012

This process is used to identify if there is any inconsistency in the financial data by defining some user checks. In the following steps,

balance of

________________________________________________________________________








01/01/2012

1. Go to Administration tab, click Controls under Rules.

2. Enable the controls for a model by highlighting the model and press Enable controls at the top. Then click Ok.

________________________________________________________________________








01/01/2012

3. Click New to create a new control and enter the following

details.

ID: Name of the control (BALANCE_CHECK)

Type: Blocking – must be passed before advancing to next work state.

Type: Warning – Can let to proceed with the next step in the work status.

Breakdown Dimensions: Two additional dimensions can be selected to balance

by.

4. The description, the tolerance Thresholds based on absolute

value or percentage are entered as follows.

________________________________________________________________________








01/01/2012

5. In the following screen the accounts are entered as follows to compare the total assets and total liability. BS100-Total Assets at the top part of the screen BS200-Total Liability at the bottom of the screen.

6. If there is a need to display the input schedule or web report

when the control is executed, then the Documents section is used as follows.

________________________________________________________________________








01/01/2012

7. After entering the above details, validate the control and save it.

8. Now go back to controls main menu and highlight the model, and then hit Edit Sets.

________________________________________________________________________








01/01/2012

9. Create the new set (control_set1) as follows. Here use the Add option to add the newly created control in the above steps.

10. Now the assignment of control is configured in Edit

Assignments tab from the controls main menu.

________________________________________________________________________








01/01/2012

11. In the following screen, choose the category and time for which the control needs to be assigned. The control_set1 is chosen by double clicking at the intersection of the category (ACTUAL) & the time (2012.12) in the below screen.

________________________________________________________________________








01/01/2012

12. Now we are ready to run the controls. Go to Home, click Consolidation central, and then click Controls Monitor.

13. Choose the model at the top right hand corner and set the context at the top of the screen.

14. Highlight the higher level group (S_World) and click the Run controls.

15. After successful run of the control, click the open control results to see the failed items. The following screen should display the ‘Failed’ status as follows.

________________________________________________________________________








01/01/2012

16. Click on the failed controls to see detail error message as follows.

17. Now click the line ‘Balance Check for Australia’, the screen should display the following details where it shows the liability not equal to assets. Here the control failed for the difference of $19,361

________________________________________________________________________








01/01/2012

18. We will adjust this amount by using a journal entry and rerun the control in the next section.

Journal

1. From the Home tab on the Start Page, choose Planning and Consolidation Administration → Features → Journals.

________________________________________________________________________








01/01/2012

2. Now highlight the model and click New to create a Journal template as given in the following screen.

3. Save and close the template.

4. Access the Journal Landing Page for your Legal model. a) From the Home tab n the Start Page, choose Consolidation Central → Journals. b) On the upper right, select your Legal model.

________________________________________________________________________








01/01/2012

5. Create new Journal Entry as given in the following screen.

6. Now go to the controls monitor and run the controls one more time by clicking the Run controls. Here it shows the controls ran successfully and it balanced on the liability and assets.

________________________________________________________________________








01/01/2012

Appendix: Ownership Calculations:

1. Go to Consolidation Central in the home tab and click on ownership manager as in the following screen.

2. Select the context in the top of the screen and click edit. Category = Actual, TIME= 2012.12 and Group = S_WORLD (Corporate)

________________________________________________________________________








01/01/2012

3. Click Add and select the holding and subsidiaries as follows.

4. Define the holding company by double clicking the current consolidation method and choose “101 – Holding” in the drop down list and save the model.

________________________________________________________________________








01/01/2012

5. Click the Calculate button at the top right corner and select the direct share method in the pop window as in the following screen. Then press okay.

________________________________________________________________________








01/01/2012

6. The following screen shows the generated values of percent control and percent ownership by the direct share method as entered in the input schedule in step #1 of data preparation section.

________________________________________________________________________








01/01/2012

7. Now click calculate and choose group share method as follows.

Then Click okay.

8. Now the percent control and percent ownership are calculated

by the group share method option.

________________________________________________________________________








01/01/2012

The Group Share of China is 22% Percent Control since Australia only has 55% control (.55 x .40 = .22). The Group Share of China is 42% Percent Control since Australia only has70% ownership (.70 x .60 = .42) .

9. Now overwrite the Percent Ownership – Current by using the group share method as follows.

________________________________________________________________________








01/01/2012

10. In the following scree, the generated values are copied into current percent of Ownership (POWN) since the overwrite option was chosen.

________________________________________________________________________








01/01/2012

11. Now update the method Percent Consolidation and Percent Ownership values using the Group Share Method.

12. The options selected in the above screen, updated 4 items as follows.

a. The Method for Australia is updated to Proportional since its Percent Control falls between the range of .25 to .75 specified in the Methods above.

b. The Method for China is updated to Equity since it’s Percent Control falls between the range of .00 to .25 specified in the Methods above.

________________________________________________________________________








01/01/2012

c. The Percent Consolidation (PCON) for Australia is updated to .75 since it’s Percent Control falls between the range of .25 to .75 specified in the Methods above.

d. The Percent Consolidation (PCON) for China is updated to .25 since its Percent Control falls between the range of .00 to .25 specified in the Methods above.

13. Now calculate the methods and percentages by choosing direct share method as follows.

________________________________________________________________________








01/01/2012

14. Now the method and PCON are calculated based on the direct share method.

a. The Method for C2000 is updated to Proportional since its

Percent Control falls between the range of .25 to .75 specified in the Methods above.

b. The Percent Consolidation for C2000 is updated to .75 since its Percent Control falls between the range of .25 to .75 specified in the Methods above.

________________________________________________________________________








01/01/2012

15. Now calculate for Group shares only without any other options as given below.

16. The output of the above option will change the calculations as follows.

________________________________________________________________________








01/01/2012

17. Now we will test the option of calculating methods and the percent of consolidation (PCON) based on the previous calculation.

________________________________________________________________________








01/01/2012

18. In the below screen the method and PCON are updated with the previous calculations.

________________________________________________________________________








01/01/2012

Key Financial Terms

________________________________________________________________________








01/01/2012

Disclaimer:

This description is a preliminary version and not subject to a license agreement or any other agreement with SAP®. This document contains only intended strategies, developments, and functionalities of the SAP product and is not intended to be binding upon SAP to any particular course of business, product strategy, and/or development. Please note that this preview is subject to change and may be changed by SAP at any time without notice.

SAP assumes no responsibility for errors or omissions in this document. SAP does not warrant the accuracy or completeness of the information, text, graphics, links, or other items contained within this material. This preview is provided without a warranty of any kind, either express or implied, including but not limited to the implied warranties of merchantability, fitness for a particular purpose, or non-infringement.

SAP shall have no liability for damages of any kind including without limitation direct, special, indirect, or consequential damages that may result from the use of these materials. This limitation shall not apply in cases of intent or gross negligence. The statutory liability for personal injury and defective products is not affected.

________________________________________________

SAP Community Contributors: Author: Chief Architect: Sulthan Mohammad Jothi Periasamy SAP EPM/BPC Project Lead/Manager /Architect SAP HANA/EPM/BI/EIM Community Thought Leader SAP EPM Community Member SAP BPC/BOBJ/BI/MDM Community Domain Champion [email protected] [email protected] , (916)-296-0228 - Cell

Contact Us For:

� IC Eliminations � IC Matching , IC Booking , Account Transformations , Carry Forward � Consolidation Leading Practices and Design Advisory � Minority Interest and Equity Calculations, and Much More …

Sapbpc nw 10.0 consolidations ownership and minority interest calculations v2

Education

Transcript of Sapbpc nw 10.0 consolidations ownership and minority interest calculations v2