Multiple Valuation of Cost of Goods Manufactured
International groups are often required to valuate their goods inventories in accordance with multiple accounting principles, for example, in accordance with IFRS following group guidelines and also in accordance with local accounting principles.
Using the various functions for multiple valuation of cost of goods manufactured, you can valuate the cost of goods manufactured in accordance with multiple accounting principles at actual costs in parallel. These functions offer you an integrated, verifiable valuation process that eliminates the cumbersome manual process of valuating your inventories separately for different accounting principles.
You can use these functions if you are using new General Ledger Accounting or classic General Ledger Accounting. In addition, you can work with ledgers as well as with parallel accounts. The parallel ledger can only be used with new General Ledger Accounting.
You have to configure the Customizing settings for parallel accounting in Controlling as well as for the versions and the currency and valuation profile.
For more information, see Customizing for Parallel Accounting.
Depending on which functions you use for multiple valuation of cost of goods manufactured, you must configure function-specific Customizing settings.
The accounting principles determine which valuation approaches are applied:
In Asset Accounting and in Cost Center Accounting
For more information, see Asset Accounting and Cost Center Accounting.
For the actual price calculation
For more information, see Price Calculation.
For the cost of goods manufactured and the inventory values
For more information, see Cost of Goods Manufactured and Inventory Values.
For costs and work in process for projects and orders
For more information, see Parallel Values for Orders and Projects.
In real-time integration
Note
Real-time integration is not available with classic General Ledger Accounting.
For more information, see Customizing for Real-Time Integration.
The following figure illustrates the value flow for the multiple valuation of cost of goods manufactured in the relevant functions:

Value Flow for the Multiple Valuation of Cost of Goods Manufactured
Parallel values for the actual costs of different accounting principles can be recorded for cost centers using depreciation from Asset Accounting or by direct postings from Financial Accounting.
These parallel values can be allocated within Cost Center Accounting using assessments, distributions, and activity allocation with subsequent actual price calculation and revaluation.
The cost center is credited based on the accounting principle and taking into account the actual prices of the cost centers for production processes in the actual costing of the material ledger.
Through revaluation of the allocated activities with actual prices or direct postings from financial accounting, parallel values can be used for orders and projects, included in results analysis, and settled to other receivers in Controlling and to G/L accounts and assets.
The following applies to the actual costing:
Production processes of materials are revaluated through actual costing with parallel values.
If you generally use actual costs, the periodic costing run calculates and posts the cost of goods manufactured for the global accounting principle and the alternative valuation run posts this for the local and additional accounting principles.
If you generally use standard costs and only use actual costs due to a local accounting principle, the period costing run can also calculate and post actual prices from the version for the parallel cost of goods manufactured. Version 0 remains valuated for standard costs.
The remaining balance for version 0 can be credited to costing-based profitability analysis using assessments.
Note
In costing-based profitability analysis, multiple valuations are not managed for parallel cost of goods manufactured. Only the operational valuation (legal valuation) is available.
The settlement of parallel values to assets requires the use of the business function FI_AA Multiple Valuation
(FIN_AA_PARALLEL_VAL
).