Cost+Center+Splitting+Concepts[1]

SAP Controlling

Cost Center Splitting Concept

Version: 1.0

Cost Center Splitting Concepts

Modified: 3/1/2013 7:55 PM .

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Last modified by: Malati Bhatt

SAP Controlling


Version: 1.0

Table of Contents

1.Purpose / Use................................... Use.......................................................... .............................................. .............................................. ..........................................8 ...................8 2.Features........................... 2.Features.................................................. .............................................. .............................................. .............................................. ...................................8 ............8 3.Pre-requisites........................ 3.Pre-requisites............................................... .............................................. .............................................. .............................................. ............................10 .....10 3.1.Master Data Requirements......................................................................................................10 3.2.Configuration Requirements....................................................................................................10

4.Overview of Scenario and Pre-requisite Settings....................................................... Settings................................................................12 .........12 4.1.Scenario.....................................................................................................................................12 4.2.Master Data Setup....................................................................................................................12 4.3.Configuration Requirements....................................................................................................14 4.3.1.Configuration of Splitting Structure......................................................................................................14 4.3.2.Assigment of Splitting Structure to the Cost Center.............................................................................18

5.Planning Activity Costs on Cost Center................................................... Center........................................................................... ............................22 ....22 5.1.Checking Plan costs on Cost Center Reports (S_ALR_87013611)........................................22 5.2.Plan Activity Quantity..............................................................................................................24 5.3.Plan - Splitting.............................. Splitting..................................................... ....................... ....................... ....................... .......................26 .................... ...26 5.4.Plan - Price Calculation..................................... ....................... ....................... ..................... ............... .........28 ...28 5.5.Testing Results..........................................................................................................................30 5.5.1.Checking Plan Price per Activity Unit (KP27)......................................................................................30 5.5.2.Checking Plan Activity Costs on Cost Center reports (S_ALR_87013611).........................................32

6.Posting Actual Costs.................................. Costs......................................................... .............................................. ............................................ .............................34 ........34 6.1.Posting Cost Center via monthly Payroll cycle and checking its impact..............................34 6.2.Case1 : 180 hours (plan hours) AllocATED............................................................................36 6.2.1.Cost Center Report – Comparison Actual v/s Plan (S_ALR_87013611)..............................................36 6.2.2.Cost Center Report – Comparison Actual v/s Target (S_ALR_87013625)..........................................38 6.2.3.Period End Closing – Actual Splitting...................................................................................................40 6.2.4.Period End Closing – Price Calculation................................................................................................44 6.2.5.Testing Results – Actual Price (KBK6).................................................................................................46 6.2.6.Testing Results – Actual Cost Document (KSB5)................................................................................48 6.2.7.Testing Results – Cost Center Report – Actual v/s Plan (S_ALR_87013611).....................................48 6.2.8.Testing Results - Cost Center Report – Actual v/s Target (S_ALR_87013625)...................................50 6.2.9.Important Notes.....................................................................................................................................50

6.3.Case2 : 130 hours (LESS than plan hours) ALLOCATED...................................................52 6.3.1.Cost Center Report – Comparison Actual v/s Plan (S_ALR_87013611)..............................................52 6.3.2.Cost Center Report – Comparison Actual v/s Target (S_ALR_87013625)..........................................54 6.3.3.Period End Closing – Actual Splitting...................................................................................................56 6.3.4.Period End Closing – Price Calculation................................................................................................56 6.3.5.Testing Results – Actual Price (KBK6).................................................................................................58 6.3.6.Testing Results – Actual Cost Document (KSB5)................................................................................58 6.3.7.Testing Results – Cost Center Report – Actual v/s Plan (S_ALR_87013611).....................................60 6.3.8.Testing Results - Cost Center Report – Actual v/s Target (S_ALR_87013625)...................................62 6.3.9.Important Notes.....................................................................................................................................62

Modified: 3/1/2013 7:55 PM .

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Version: 1.0

Table of Contents

1.Purpose / Use................................... Use.......................................................... .............................................. .............................................. ..........................................8 ...................8 2.Features........................... 2.Features.................................................. .............................................. .............................................. .............................................. ...................................8 ............8 3.Pre-requisites........................ 3.Pre-requisites............................................... .............................................. .............................................. .............................................. ............................10 .....10 3.1.Master Data Requirements......................................................................................................10 3.2.Configuration Requirements....................................................................................................10

4.Overview of Scenario and Pre-requisite Settings....................................................... Settings................................................................12 .........12 4.1.Scenario.....................................................................................................................................12 4.2.Master Data Setup....................................................................................................................12 4.3.Configuration Requirements....................................................................................................14 4.3.1.Configuration of Splitting Structure......................................................................................................14 4.3.2.Assigment of Splitting Structure to the Cost Center.............................................................................18

5.Planning Activity Costs on Cost Center................................................... Center........................................................................... ............................22 ....22 5.1.Checking Plan costs on Cost Center Reports (S_ALR_87013611)........................................22 5.2.Plan Activity Quantity..............................................................................................................24 5.3.Plan - Splitting.............................. Splitting..................................................... ....................... ....................... ....................... .......................26 .................... ...26 5.4.Plan - Price Calculation..................................... ....................... ....................... ..................... ............... .........28 ...28 5.5.Testing Results..........................................................................................................................30 5.5.1.Checking Plan Price per Activity Unit (KP27)......................................................................................30 5.5.2.Checking Plan Activity Costs on Cost Center reports (S_ALR_87013611).........................................32

6.Posting Actual Costs.................................. Costs......................................................... .............................................. ............................................ .............................34 ........34 6.1.Posting Cost Center via monthly Payroll cycle and checking its impact..............................34 6.2.Case1 : 180 hours (plan hours) AllocATED............................................................................36 6.2.1.Cost Center Report – Comparison Actual v/s Plan (S_ALR_87013611)..............................................36 6.2.2.Cost Center Report – Comparison Actual v/s Target (S_ALR_87013625)..........................................38 6.2.3.Period End Closing – Actual Splitting...................................................................................................40 6.2.4.Period End Closing – Price Calculation................................................................................................44 6.2.5.Testing Results – Actual Price (KBK6).................................................................................................46 6.2.6.Testing Results – Actual Cost Document (KSB5)................................................................................48 6.2.7.Testing Results – Cost Center Report – Actual v/s Plan (S_ALR_87013611).....................................48 6.2.8.Testing Results - Cost Center Report – Actual v/s Target (S_ALR_87013625)...................................50 6.2.9.Important Notes.....................................................................................................................................50

6.3.Case2 : 130 hours (LESS than plan hours) ALLOCATED...................................................52 6.3.1.Cost Center Report – Comparison Actual v/s Plan (S_ALR_87013611)..............................................52 6.3.2.Cost Center Report – Comparison Actual v/s Target (S_ALR_87013625)..........................................54 6.3.3.Period End Closing – Actual Splitting...................................................................................................56 6.3.4.Period End Closing – Price Calculation................................................................................................56 6.3.5.Testing Results – Actual Price (KBK6).................................................................................................58 6.3.6.Testing Results – Actual Cost Document (KSB5)................................................................................58 6.3.7.Testing Results – Cost Center Report – Actual v/s Plan (S_ALR_87013611).....................................60 6.3.8.Testing Results - Cost Center Report – Actual v/s Target (S_ALR_87013625)...................................62 6.3.9.Important Notes.....................................................................................................................................62

Modified: 3/1/2013 7:55 PM .

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SAP Controlling

Modified: 3/1/2013 7:55 PM .


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Version: 1.0


SAP Controlling


Version: 1.0

Revision History Date 31.01.2013

Version 1.0

Description Original Document

Modified: 3/1/2013 7:55 PM .

Author Malati Bhatt

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SAP Controlling

1.


Version: 1.0

Purpose / Use

Costs are of 2 types - Activity Dependant or Activity Independent Activity Dependant costs - These are the costs that are tagged to a specific activity type. It can happen in 2 ways •

•

By way of FI postings - You can specify Cost Center / Activity Type while doing postings from FI By way of Cost Center Splitting

Activity Dependant costs are not split any further. They are simply divided by the activity quantity to which they are attached to. Activity Independent costs - These are the costs not attached to any activity type. These are split between all other activities as per commonly used methods as shown below •

•

Activity Qty. This means such costs to be divided between all activity types based on plan / actual quantity of those activity types. Equivalence nos. In KP26, by default the equivalence no is 1. If no other method is found, it would use Equivalence number for the purpose of splitting.

During plan cost splitting, the system splits the activity-independent plan costs of a cost center among the activity types of this cost center. You must split plan costs before executing: •

Price calculation: Plan costs are split automatically during price calculation. The SAP System determines the plan prices from the ratio of plan costs and plan activity. Splitting activity-independent plan costs on the cost center activity types helps to calculate the fixed price portion of the overall price. Plan cost splitting therefore ensures that all planned costs are considered during price calculation.

•

Plan/Target/Actual Comparison To view all costs at the cost center/activity type level and make plan/target/actual comparisons, you must split activity-independent actual and plan costs among the activity types. You use the same methods for actual and plan costs. In the actual there is an additional splitting step in which the actual data is adjusted to the plan data. Actual data is distributed to the activity types on the basis of target costs or target quantities and by cost element.

2.

Features The activity-independent costs planned on a cost center are split on the activity types according to the splitting structure that you defined during Customizing and assigned to this cost center. A splitting structure contains one or more assignments in which you store splitting rules for the corresponding cost element(s) or cost element groups. You can restrict the selection of cost elements or cost element groups, as well the activity types on which the costs are split.

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Splitting methods are assigned to the splitting rules. These methods specify how the costs are split. Based on the splitting methods, which are fixed in the R/3 System, you can split plan costs according to the following criteria: •

Activity quantity

•

Equivalence number

•

Capacity

•

Output

•

Scheduled activity

•

Statistical key figure (quantity)

•

Statistical key figure (maximum quantity)

•

No splitting is executed

You can also use weighting indicators to control whether tracing factors are to be weighted for the cost splitting. Set the indicator if the individual tracing factor values use different units of measure. If the Conversion indicator is active, the values are multiplied with the equivalence numbers of the activity types. This enables you to compare the different units of measure of the tracing factor values.

3.

Pre-requisites

3.1. Master Data Requirements  



Cost Elements (Cost Element Category - 43) Cost Centers Activity Types (Activity Type Category – 1, Price Indicator – 1, Act. Price indicator

– 5)

3.2. Configuration Requirements  

Splitting Structure Setup Assignment of Splitting Structure to applicable Cost Centers

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SAP Controlling

4.


Version: 1.0

Overview of Scenario and Pre-requisite Settings

4.1. Scenario For the purpose of easy understanding, we will take a simple scenario to understand and be clear on the concept of Cost Center Splitting. In our Example, Two individuals of Level Senior Executive and Senior Software Engineer are on Project MUS01. All emoluments paid to these individuals are been posted to only one Cost Center – ‘Proj-Mus01’. During September 2010, they both work on Job Jar Activity for which now costs has to be allocated to Cost Center ‘Jobjar01’

4.2. Master Data Setup ITP Cost Center Job Jar Cost Center Activity Types

: : :

Cost Elements (Cat – 43)

:

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Proj-Mus01 Jobjar01 SSE SE 943003 – Pay – SSE (Linked to AT – SSE) 943004 – Pay – SE (Linked to AT – SE)

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4.3. Configuration Requirements

4.3.1. Configuration of Splitting Structure •

Access Splitting Structure through Transaction Code – OKES Navigation Path – SPRO -> Controlling -> Cost Center Accounting -> Planning -> Allocations -> Activity Allocations -> Splitting -> Define Splitting Structure

Before Creating Splitting Strcuture, we would be required to Create Splitting Rule. Click on Splitting Rules and then Click on New Entries. Maintain Values as shown below •

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•

Select ‘CS1’ and click on ‘Selection of Rules’ and maintain values as shown below

•

Repeat above step for ‘CS2’

•

Click on Splitting Structure. Click on New Entries and maintain values as shown

below

•

Select ‘CS’ line and Click on Assignments and maintain values as shown below

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•

•


Version: 1.0

Select ‘CS1’ and Click on ’Selection for assignment’. Maintain Values as shown below

Go one step back and Select ‘CS2’ and Click on ’Selection for assignment’. Maintain Values as shown below

Save the configurations for ‘Splitting Structure’

4.3.2. Assigment of Splitting Structure to the Cost Center •

Access Assignment through Transaction Code – OKEW Navigation Path – SPRO -> Controlling -> Cost Center Accounting -> Planning -> Allocations -> Activity Allocations -> Splitting -> Assign Splitting Structure to Cost Centers

Maintain Values as shown above and click ‘Change’ (Pencil icon) Modified: 3/1/2013 7:55 PM .

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SAP Controlling

•


Version: 1.0

Assign Cost Center ‘Proj-Mus01’ to Splitting Structure ‘CS1’ as shown below. Save on exit

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5.


Version: 1.0

Planning Activity Costs on Cost Center

5.1. Checking Plan costs on Cost Center Reports (S_ALR_87013611)

Their Emoluments are as follows: Particulars

GL # 490001 490002 490003 490004

Basic Others Conveyance LTA Total

SSE 10000 29000 800 25000

SE 25000 72500 800 25000

64800

123300

Total Relationship 35000 1.0:2.5 101500 1.0:2.5 1600 1.0:1.0 50000 1.0:1.0 188100

These Individuals work for 20 days a month. Considering 9 hours per day, the hour rate is as follows: Particulars Total Hours work

SSE 64800 180

SE 123300 180

360

685

Hourly Rate

These Hourly rates calculated above are done manually. Lets now derive these values using SAP Configurations.

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5.2. Plan Activity Quantity Transaction Code – KP26 Navigation Path – SAP Easy Access Menu -> Accounting -> Controlling -> Cost Center Accounting -> Planning -> Activity Output/Prices -> Change Maintain Values as shown below and Save

Save on Exit

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5.3. Plan - Splitting Transaction Code – KSS4 Navigation Path – SAP Easy Access Menu -> Accounting -> Controlling -> Cost Center Accounting -> Planning -> Allocations -> Splitting Maintain Values as shown below and Save

Cost Element wise – Breakup

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Basis for Calculation

After verifying the results in Test run, Go back to initial screen and remove tick on ‘Test Run’

5.4. Plan - Price Calculation Transaction Code – KSPI Navigation Path – SAP Easy Access Menu -> Accounting -> Controlling -> Cost Center Accounting -> Planning -> Allocations -> Price Calculation Maintain Values as shown below and Save

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5.5. Testing Results 5.5.1.

Checking Plan Price per Activity Unit (KP27)

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SAP Controlling 5.5.2.


Version: 1.0

Checking Plan Activity Costs on Cost Center reports (S_ALR_87013611)

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6.


Version: 1.0

Posting Actual Costs

6.1. Posting Cost Center via monthly Payroll cycle and checking its impact Particulars Basic Others Conveyance LTA Total

SSE (P) 10000 29000 800 25000

SSE (A) 10000 26000 800 13600

SE (P) 25000 72500 800 25000

SE (A) 25000 69500 800 12700

Total (P) 35000 101500 1600 50000

Total (A) 35000 95500 1600 26300

64800

50400

123300

108000

188100

158400

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6.2. CASE1 : 180 HOURS (PLAN HOURS) ALLOCATED Overview : Both SE & SSE work for full month on Jobjar Activity i.e. book 180 hours on Jobjar for each level. Before Actual Price Calculation 6.2.1.

Cost Center Report – Comparison Actual v/s Plan (S_ALR_87013611)

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Cost Center Report – Comparison Actual v/s Target (S_ALR_87013625)

As you can see from above, as 180 hours were utilised during the period, Actual costs are derived based on Actual hours worked multiplied with the Plan Rate. Further since 100% operation has been completed, Target and Actual values would be the same. Hence at period end it becomes critical where values are significant to bring the ‘Over/Under absorption’ to minimal. This is done as detailed below

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6.2.3.


Version: 1.0

Period End Closing – Actual Splitting

Transaction Code – KSS2 Navigation Path – SAP Easy Access Menu -> Accounting -> Controlling -> Cost Center Accounting -> Period-End Closing -> Single Functions -> Splitting Maintain Values as shown below

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6.2.4.


Version: 1.0

Period End Closing – Price Calculation

Transaction Code – KSII Navigation Path – SAP Easy Access Menu -> Accounting -> Controlling -> Cost Center Accounting -> Period-End Closing -> Single Functions -> Price Calculation Maintain Values as shown below


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Version: 1.0

After Actual Price Calculation 6.2.5.

Testing Results – Actual Price (KBK6)

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6.2.6.

Testing Results – Actual Cost Document (KSB5)

6.2.7.

Testing Results – Cost Center Report – Actual v/s Plan (S_ALR_87013611)

•

Cost Center – PROJ-MUS01

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Cost Center – JOBJAR01

6.2.8.

Testing Results - Cost Center Report – Actual v/s Target (S_ALR_87013625)

6.2.9.

Important Notes

The moment the price is calculated and adjusted using above processes, any further activity allocation will be done at the Actual Rate that is fixed using this process. It will not use the Plan rate per activity. In this case, you will have to run Actual Splitting and Actual Price calculation again to recalculate the actual price (rate) for the period.

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6.3. CASE2 : 130 HOURS (LESS THAN PLAN HOURS) ALLOCATED Overview : Both SE & SSE work for most hours but not all on Jobjar Activity i.e. book 130 hours on Jobjar for SSE & 100 hours for SE level. Before Actual Price Calculation 6.3.1.

Cost Center Report – Comparison Actual v/s Plan (S_ALR_87013611)

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Version: 1.0

Cost Center Report – Comparison Actual v/s Target (S_ALR_87013625)

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6.3.3.


Version: 1.0

Period End Closing – Actual Splitting

Transaction Code – KSS2 Navigation Path – SAP Easy Access Menu -> Accounting -> Controlling -> Cost Center Accounting -> Period-End Closing -> Single Functions -> Splitting Results

6.3.4.

Period End Closing – Price Calculation

Transaction Code – KSII Navigation Path – SAP Easy Access Menu -> Accounting -> Controlling -> Cost Center Accounting -> Period-End Closing -> Single Functions -> Price Calculation Results

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After Actual Price Calculation 6.3.5.

Testing Results – Actual Price (KBK6)

6.3.6.

Testing Results – Actual Cost Document (KSB5)

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6.3.7.


Version: 1.0

Testing Results – Cost Center Report – Actual v/s Plan (S_ALR_87013611)

•

Cost Center – PROJ-MUS01

•

Cost Center – JOBJAR01

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Cost+Center+Splitting+Concepts[1]

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