Function documentationResults Analysis

 

Results analysis can be used:

  • In the Product Cost by Sales Order component

    Results analysis is performed on the sales order item.

  • In Engineer-to-Order

  • For internal orders that carry revenue

The following sections describe results analysis at the level of the sales order item.

You can perform results analysis for each sales order item to valuate the result of the sales order item.

You can use results analysis to:

  • Calculate the value of the costs that can be capitalized for each sales order item

    You can capitalize costs with an option to capitalize by means of settlement to Financial Accounting (FI).

  • Determine whether reserves should be created

    Results analysis creates reserves that you can transfer to FI, Profit Center Accounting (EC-PCA), and (depending on the type of reserve) Profitability Analysis (CO-PA) when you settle.

  • Reconcile the data posted in FI and in CO-PA to each other

    Because the revenues affecting net income and the costs affecting net income are usually different from the actual revenues and actual costs posted in FI, the result shown in CO-PA is different from the profit/loss in FI. The difference between the value in CO-PA and the value in FI can be offset by means of postings of reserves and inventories. If you are not using CO-PA, correction postings can still be made in FI. The correction postings are made through the settlement of results analysis data.

Note Note

If you are using a nonvaluated sales order stock, you normally perform results analysis.

End of the note.

Depending on the results analysis method, the system can calculate the following results analysis data:

  • Inventory values

  • Reserves for unrealized costs

  • Reserves for imminent loss

  • Reserves for complaints and commissions

  • Cost of sales

  • Calculated revenue

Integration

You can use the Schedule Manager to assist you in performing the period-end closing activities. For more information, refer to the following sections:

Scheduler

Monitor

Flow Definition

Note Note

You cannot use the multilevel worklist of the Schedule Manager in the Product Cost by Sales Order component.

End of the note.

You can settle the following results analysis data to FI and EC-PCA:

  • Inventory values (depending on the results analysis method, capitalized costs or revenue in excess of billings)

  • Reserves for unrealized costs

  • Reserves for imminent loss

  • Reserves for complaints and commissions

  • The cost of sales, if you are using a nonvaluated sales order stock and are balancing in Financial Accounting with the cost-of-sales accounting method

You can settle the following results analysis data to CO-PA:

  • Cost of sales or calculated revenue

  • Reserves for imminent loss and complaints

Note Note

Only the difference in the results analysis data against the previous month is settled.

End of the note.

Note also the capabilities of user-defined error management.

For more information on transferring data from sales order item to other application components, see Settlement of Sales Order Items.

Prerequisites

Carry out the period-end closing activities in Product Cost by Order and Product Cost by Period.

In the period-end closing functions for Product Cost by Sales Order, perform the functions that precede results analysis.

Before you perform results analysis on the sales order item, you must do the following in Customizing for Product Cost by Sales Order under Start of the navigation path Period-End Closing Next navigation step Results Analysis End of the navigation path:

  • Specify a results analysis key.

    The results analysis key specifies that results analysis should be carried out for the sales order item. The results analysis key can be transferred into the sales order item as a default value through the requirements class. You can view this results analysis key in the sales order item. For sales order items, the standard system supplies results analysis key 000004. For internal orders and projects, the standard system supplies results analysis key 000001.

    If you don’t want to perform results analysis, make sure that no results analysis key is defaulted into the sales order item. You make this setting in the requirements class.

  • Define one or more results analysis versions.

    In combination with the results analysis key, the results analysis version specifies a valuation method.

    To valuate the sales order item from different perspectives, you can define multiple results analysis versions for each results analysis key. Results analysis version 0 is the only results analysis version that is relevant to settlement. This means that only the results analysis data that is undated under results analysis version 0 can be transferred to CO-PA. You can transfer results analysis data of other results analysis versions to FI.

    Example Example

    You calculate the cost of sales for the sales order item from the actual revenue. You create a results analysis version that links the results analysis key of the order to the corresponding valuation methods. You transfer the results of this valuation into Financial Accounting and Profitability Analysis.

    Assume you want to calculate the order revenue using the actual costs (percentage-of-completion method) for internal purposes. You create a second results analysis version that links the results analysis key of the order to the corresponding valuation methods. The results of this valuation are not transferred into Financial Accounting nor into Profitability Analysis.

    The results of both valuations are updated to the sales order item and can be analyzed in the information system at any time.

    End of the example.

  • Define the valuation method

    The valuation method controls a number of parameters including the following:

    • The results analysis method

      The results analysis method determines the formula used to calculate the results analysis data.

    • At which status the inventories and reserves are created and canceled

      The system always begins creating inventories and reserves when the status REL (released) has been set.

    • The profit basis

      The profit basis specifies how the system determines the planned costs that are used to calculate the results analysis data. For example, the planned costs may be based on the preliminary cost estimate for the production order or on the sales order cost estimate.

    • The valuation level

      The valuation level determines whether the results analysis data:

      • Is calculated as a total

        If you calculate the results analysis data as a total, the sum values are distributed to individual cost element groups in accordance with the method of apportionment specified in the Expert Mode of the valuation method. These cost element groups are represented by line IDs. The method of apportionment is preset in the Expert Mode.

      • Are calculated separately by cost element group (that is, by line ID)

  • Define line IDs

    Line IDs enable you to group the costs according to the requirements of CO-PA and FI. For example, you can create separate line IDs for direct materials costs, production overhead, and revenues. Grouping costs into line IDs allows you to do the following:

    • For settlement to FI, you can specify in the assignment of costs to line IDs which costs for each line ID have a requirement to be capitalized or reported as a liability; cannot be capitalized; or have an option to be capitalized or reported as a liability.

    • For settlement to CO-PA, you can list in the settlement structure the cost elements under which the results analysis data have been updated.

    All costs that are to be included in results analysis must be assigned to line IDs.

  • Assign costs to line IDs

    Here you assign the cost elements under which an object is debited or credited to the line IDs. For settlement to FI, you specify which costs:

    • Must be capitalized or carried as a liability

    • Cannot be capitalized

    • Have an option to capitalize or be carried as a liability

    Note Note

    If you are using a valuated sales order stock and the sales order item carries costs and revenues, the sales order item is debited under the cost element that corresponds to the inventory change account (account for cost of sales) that is posted when the goods are delivered to the customer. You assign this cost element to a line ID. You do not have to assign the cost elements for the cost of goods manufactured that are shown in the cost element itemization of the sales order cost estimate.

    End of the note.

  • Create secondary cost elements for the results analysis data

    The results analysis function updates the results analysis data to the sales order item under secondary cost elements (cost element category 31).

  • Define the update of the results analysis cost elements

    You specify the secondary cost elements under which the results analysis data is updated under Define Update for Results Analysis.

    You create a secondary cost element for each cost grouping that you show separately in the line ID.

    Example Example

    Work in process that is created for the direct costs is updated under cost element 672111 (Creation of inventory EK).

    Reserves for unrealized costs that are created for the direct costs are updated under cost element 673111 (Creation of inventory EK).

    The cost of sales that was calculated for the direct costs are updated under cost element 671110 (Cost of sales EK).

    Actual revenue is updated under cost element 671170 (revenue).

    End of the example.

    Assign each line ID to a category.

  • Define posting rules

    Here you specify the G/L accounts in Financial Accounting to which the results analysis data are passed.

    You can also specify G/L accounts in the posting rules for which the indicator Post automatically only is set in the G/L account master. If you have specified a G/L account in the posting rules for which the indicator Post automatically only is set, and if you must make corrections to results analysis data (such as work in process), you have the following options:

    • You turn off the indicator Post automatically only in the G/L account master.

    • You perform the correction posting on a different G/L account.

You should also do the following:

  • Close the posting period for the preceding month.

  • Make sure that a cutoff period is defined.

    The cutoff period divides the life cycle of the sales order item into open and closed periods. This has the following effects on results analysis:

    • The results analysis data calculated up to and including the cutoff period is not changed.

    • The results analysis data from later periods is overwritten by the current results analysis data.

    If you can no longer make postings in FI for the corresponding period, you should make sure that the results analysis data is not changed.

    To prevent posted data from being changed, you usually set the cutoff period as the period before the results analysis period.

    Example Example

    You have performed results analysis for the sales order item in May and June. You have transferred the work in process and the reserves to Financial Accounting.

    To ensure that results analysis for July does not change this data, define the cutoff period as period 06 and perform results analysis for results analysis period 07. Changes to the planned data and actual data in May and June are not reflected until period 07.

    End of the example.

    You can specify in the valuation method that the cutoff period is always the period preceding the results analysis period. In the standard system, this is the default setting for all results analysis methods. You can also specify the cutoff period in the results analysis version. You can also make this setting in the menu of Product Cost by Sales Order. The entry in the results analysis version overrides the entry in the valuation method.

    Note Note

    If you have specified in the valuation method that the cutoff period should always be the month preceding the results analysis period, the entry in the results analysis version is not adjusted.

    End of the note.

    Example Example

    You have entered D in the Cutoff period field in the valuation method (cutoff period is period preceding results analysis period).

    The month preceding the results analysis period is period 11. In the results analysis version, period 1 is entered as the cutoff period. The cutoff period is period 11.

    End of the example.

With all results analysis methods except the POC methods, some data is updated as a total while other data is apportioned as line IDs. In the step Define update in Customizing you specify the cost elements under which the apportioned data is updated.

If you are using the percentage-of-completion method, all results analysis data is updated as a total. In the results analysis version, you specify the cost elements under which the calculated data is updated.

Note Note

If you are using a nonvaluated sales order stock, it is not necessary to settle the manufacturing orders assigned to the sales order item before performing results analysis. Results analysis always includes the actual costs of all objects assigned to the sales order item – even if the objects have not yet been settled to the sales order item.

However, it is still advisable to regularly settle the manufacturing orders to the sales order item. This ensures that the manufacturing orders are included in reorganization.

Although results analysis includes all actual costs even without settlement, it is not advisable to select the Must not be settled indicator for the manufacturing orders in the settlement profile. If you were to select this indicator, reorganization would include manufacturing orders that still have actual costs. This would result in results analysis showing incomplete costs.

End of the note.

Features

Results analysis can be performed using different results analysis methods. You select the results analysis method depending on which data you want to access and how you want to determine the progress of the sales order.

The results analysis data is updated by period. In each period, the changes against the previous period are saved. You can view this data in the Product Cost Controlling Information System at any time.

The data calculated automatically can be modified by the results analysis method manually.

In addition to calculating actual results analysis data, you can:

  • Calculate planned results analysis data to provide a forecast of future inventories and reserves (simulation of actual with plan)

    In this case you define a separate results analysis version for simulation.

  • Calculate planned results analysis data and settle it to CO-PA in integrated planning (“actual and plan results analysis”). This function only applies to projects and internal orders. It is irrelevant for sales order items.

    See also: Planned Results Analysis.

Improving Performance

You can use parallel processing to reduce the runtime of results analysis. This applies to results analysis for sales document items and WBS elements.

  • If you perform results analysis outside the Schedule Manager, enter a server group for background processing.

  • If you perform results analysis using the Schedule Manager, set the Parallel processing indicator in the selection screen of the program when you create the job variant. An entry field then appears in which you enter the server group.

Worklist

For the functions performed during period-end closing, the system provides a worklist that enables you to view the objects that have errors. Worklists provide information on the cause of the errors. After correcting the errors, you can carry out the function for the corresponding objects again. The system then only shows the objects that still have errors.

If you are using the Schedule Manager in an engineer-to-order environment, you can use the multilevel worklist of the Schedule Manager. The multilevel worklist allows you to edit processing step sequences. For more information, see Multilevel Worklist.

You use single-level worklists in the period-end closing process of the Product Cost by Sales Order component. For more information, see Single-Level Worklists in Product Cost by Sales Order

Transfer Prices

If you are using transfer prices, you can update results analysis data in multiple valuation views. When you calculate results analysis data in multiple valuation views, there are a number of special requirements. For information on updating data in multiple valuation views, refer to Transfer Prices in Cost Object Controlling.

User-Defined Error Management

You can influence the messages output in the log of WIP calculation by using user-defined error management.

See Integration in this section.

Activities

Perform results analysis in the period-end closing functions for Product Cost by Sales Order.

More Information

For information on the Customizing activities listed under Prerequisites, see the Implementation Guide (IMG) for Product Cost by Sales Order under Start of the navigation path Period-End Closing Next navigation step Results Analysis End of the navigation path.

For information on results analysis with a valuated sales order stock, see the section Special Case: Nonvaluated Sales Order Stock ff.

For information on additional performance improvements in CO-PC, see the section Performance in Product Cost Controlling

For detailed information on the information system in Cost Object Controlling, see the documentation Product Cost Controlling Information System.