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ERPCorp SAP FICO Blog
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SAP Results Analysis calculates the costs and revenues attributable to a period for eligible orders and projects. At month-end, it helps finance teams determine what to recognize in the income statement and what to carry on the balance sheet as work in process (WIP) or other accruals, depending on the valuation method.
This guide covers classic SAP Results Analysis. It explains how production WIP differs from percentage-of-completion (POC) valuation on customer projects, and how the results flow into Financial Accounting (FI) through settlement.
Read more: SAP Results Analysis: WIP, Percentage of Completion, and Settlement
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By Paul Ovigele
SAP Material Ledger supports inventory valuation in multiple currencies and valuation views. Its optional Actual Costing functionality calculates periodic actual material costs and helps explain differences between preliminary valuation and actual procurement and production costs.
SAP S/4HANA update: Material Ledger is mandatory for inventory valuation in SAP S/4HANA, while Actual Costing remains optional. Paul Ovigele’s original introduction is presented below with editorial updates by ERPCorp for S/4HANA terminology and scope.
Read more: SAP Material Ledger in S/4HANA: Overview and Actual Costing
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By John Jordan
Explore practical SAP Controlling (CO) tips for cost center accounting, internal orders, profit center accounting, and product cost planning. This page includes excerpts for the first 19 tips and the full table of contents.
My SAP PRESS book 100 Things You Should Know About Controlling with SAP includes step-by-step instructions and screenshots. The second edition contains 110 tips, including 10 bonus tips.
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By John Jordan
SAP cost component groups let you summarize cost components and display the resulting amounts in cost estimate reports. They help you compare material, labor, and overhead costs across a range of products without examining each material cost estimate separately.
In this guide, I explain how to create cost component groups in transaction OKTZ, assign them to cost components, and add the group columns to a classic SAP cost estimate report.
Read more: SAP Cost Component Groups: OKTZ Setup and Reporting
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By Ross Christoph
Goods Receipt/Invoice Receipt (GR/IR) clearing is an important part of the procure-to-pay process in SAP Materials Management (MM) and Financial Accounting (FI). The GR/IR clearing account is an interim G/L account that records the offsetting entries for valuated goods receipts and related supplier invoices. Either document may be posted first. Matching postings normally offset at purchase order item level; eligible FI open items are subsequently cleared through automatic clearing.
The purchasing process typically involves three documents:
- Purchase Order (PO): Specifies the materials or services ordered, quantities, and agreed prices.
- Goods Receipt (GR): Records the receipt of materials or services against the purchase order.
- Invoice Receipt (IR): Records the supplier invoice and verifies it against the purchase order and goods receipt.
In a standard valuated purchase order process, the goods receipt credits GR/IR and the invoice receipt debits it. Non-valuated receipts and other procurement scenarios can follow different posting logic.
Outstanding balances may indicate missing invoices, incomplete deliveries, or quantity differences requiring investigation.
In SAP S/4HANA, GR/IR reconciliation helps organizations identify outstanding differences and maintain accurate inventory, purchasing, and financial accounting records.
Read more: SAP GR/IR Clearing: Goods Receipt and Invoice Receipt
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I often get asked about the difference between a production order and a process order. Both can collect manufacturing costs, but the choice starts with how production is planned and executed.
Other SAP Controlling objects serve different purposes, from collecting a product’s costs by period to monitoring a maintenance job or departmental spending. This guide compares their uses, master data, and selected transactions.
Read more: SAP Cost Objects in Controlling: Types, Uses, and Transactions
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By Paul Ovigele
SAP Material Ledger FI line item texts help explain where Actual Costing differences are posted at period end. Understanding these descriptions makes it easier to distinguish inventory revaluation, consumption revaluation, and transfers between production levels.
The Post Closing step can generate many accounting entries because differences follow how a material was used. This guide explains the classic posting texts and provides a practical reference for reviewing Material Ledger closing documents.
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Activity type tutorials by Tom King
SAP activity types classify work performed by cost centers, such as machine hours or maintenance hours. The activity type category controls how quantities are recorded and allocated, while the activity price values the allocation.
This guide brings together Tom King's seven-part activity posting series. Compare the classic categories, choose a starting point, and follow the worked examples for direct, indirect, and target=actual activity allocation.
Read more: SAP Activity Type Categories: Guide to the Posting Series
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By Tom King
SAP activity type category 5 supports target=actual activity allocation. In the classic process, SAP calculates actual activity quantities from planned receiver activity inputs and operating rates, then posts the allocation with transaction KNMA.
This final tutorial in the activity posting series compares fixed and variable planned allocations. Both examples use activity type CATEG5 to allocate support activity from a sender cost center to manufacturing cost centers.
Read more: SAP Category 5 Activity Types: Target=Actual Allocation
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By Tom King
SAP activity type category 4 records activity quantities on a cost center without allocating them to receiver objects. The quantity supports operating-rate and target-cost analysis while the costs remain on the cost center.
This tutorial shows how to plan activity type CATEG4 for cost center SND4, record 500 units with KB51N, and review the resulting variable target costs without an allocation posting.
Read more: SAP Category 4 Activity Types: KB51N Without Allocation