Actual Costing with the SAP Material Ledger

Vanda Reis is a Product Costing and Material Ledger expert who has worked as a consultant and advisor for several of the largest companies worldwide. She has more than 12 years experience with product costing processes including actual costing (material ledger). Vanda has worked for several major SAP accounts as a consultant and advisor for material ledger subject matter. She has written material ledger articles for the Financial Experts magazine, and is a regular contributor to the SAP community.

. Acknowledgments. 15

1. Introduction. 17

. 1.1. Structure of this Book. 18

. 1.2. Looking Ahead. 20

PART I. Introduction to the Material Ledger. 21

2. Introduction to the Material Ledger. 23

. 2.1. Price Control and Inventory Valuation. 24

. 2.2. Material Ledger Concepts/Usage. 39

. 2.3. Material Price Determination Control. 44

. 2.4. Material Price Analysis, Categories, and Process Categories. 46

. 2.5. Procurement/Consumption Alternatives and the Controlling Level. 50

. 2.6. Summary. 53

3. Product Cost Planning. 55

. 3.1. Business Case. 56

. 3.2. Master Data. 57

. 3.3. Activity Types and Planning Prices. 66

. 3.4. Selected Configuration for Product Cost Planning. 69

. 3.5. Standard Costing. 72

. 3.6. Summary. 84

4. Material Ledger Basic Configuration and Startup. 85

. 4.1. Multiple Currencies Configuration. 86

. 4.2. Actual Costing Configuration. 94

. 4.3. Material Ledger Startup. 98

. 4.4. Reconciliation of the Material Ledger Currencies. 102

. 4.5. Price Determination Control. 104

. 4.6. Material Master Data with Material Ledger. 106

. 4.7. Summary. 107

5. Other Material Ledger Related Configurations. 109

. 5.1. Account Determination: Basic Configuration. 109

. 5.2. Account Determination: WIP Revaluation. 124

. 5.3. Exchange Rate Differences. 127

. 5.4. Summary. 129

PART II. Material Ledger Basic Functions. 131

6. Purchasing Processes and Variances. 133

. 6.1. External Procurement and Purchase Price Variances. 134

. 6.2. External Procurement and Exchange Rate Variances. 148

. 6.3. Changing the Controlling Level. 157

. 6.4. Summary. 161

7. Manufacturing and Overhead Variances. 163

. 7.1. Manufacturing Order and Preliminary Costing. 164

. 7.2. Simultaneous Costing. 170

. 7.3. Plant-to-Plant Material Transfers. 184

. 7.4. Period-End Processing. 187

. 7.5. Summary. 197

8. Periodic Actual Costing. 199

. 8.1. Creating a Costing Cockpit Run. 200

. 8.2. Material Selection. 203

. 8.3. Determine Sequence. 205

. 8.4. Single-Level Price Determination. 207

. 8.5. Multilevel Price Determination. 221

. 8.6. Post Closing. 241

. 8.7. Mark Material Prices. 255

. 8.8. Summary. 259

9. Actual Costing Revaluations. 261

. 9.1. Revaluation of Consumption. 262

. 9.2. Revaluation of Work in Process. 274

. 9.3. Summary. 304

10. Material Ledger Actual Costs and Value Flow Reports. 305

. 10.1. Actual Cost Component Split. 306

. 10.2. Valuated Actual Quantity Structure. 308

. 10.3. Actual Bill of Material. 312

. 10.4. Value Flow Monitor. 314

. 10.5. Activity Types Value Flow Display. 325

. 10.6. Summary. 327

PART III. Material Ledger Advanced Topics. 329

11. Material Ledger: More Functionalities. 331

. 11.1. Transferring Actual Costs to CO-PA. 332

. 11.2. Debiting or Crediting Materials. 342

. 11.3. Changing Actual Cost Component Split Values. 348

. 11.4. Distribution of Usage Variances (DUV). 351

. 11.5. Alternative Valuation Run (AVR). 372

. 11.6. Summary. 388

12. Transfer Prices and Multiple Valuation Approaches. 389

. 12.1. Transfer Price Concepts. 390

. 12.2. Multiple Valuation Approach Implementation Scenarios. 391

. 12.3. Multiple Valuations Configuration. 393

. 12.4. Profit Center Implementation Configuration. 403

. 12.5. Automatic Account Determination Configuration. 405

. 12.6. Defining the Transfer Prices Pricing Procedure. 410

. 12.7. Optional Configuration. 418

. 12.8. Multiple Valuations Startup Procedure. 427

. 12.9. Multiple Valuations Process Examples. 429

. 12.10. Summary. 433

13. IFRS and Multiple Valuation of Cost of Goods Manufactured. 435

. 13.1. Introduction to IFRS. 436

. 13.2. Multiple Valuation of Inventory Concept. 437

. 13.3. Multiple Valuation of COGM Configuration. 440

. 13.4. Periodic Process for Multiple Valuation of COGM. 451

. 13.5. Summary. 460

14. Actual Costing Cross-Company Code. 463

. 14.1. Stock in Transit and Actual Costing Function Prerequisites. 464

. 14.2. Stocks in Transit and Purchase Order (GRP). 470

. 14.3. Intercompany Profits in the Actual Cost Component Split. 472

. 14.4. Cross-Company Code Stock Transfer Processes in Multilevel Actual Costing. 473

. 14.5. Summary. 475

. Appendices. 477

. A. Examples in T Accounts. 479

. B. Material Ledger Data Archiving Objects. 491

. C. Bibliography. 495

. D. The Author. 497

. Index. 499