Use

Variance calculation is carried out in several steps. You must differentiate between system configuration in Customizing, which is a prerequisite for variance calculation, and the further steps executed within variance calculation itself. These include:

- Target cost calculation
- Cost splitting

Once you complete these steps, the system can calculate the variances.

You can perform cost splitting and target cost calculation without calculating variances. However, if you calculate variances, the system performs these steps automatically.

Features

For more information on Customizing, see the Implementation Guide (IMG) for the Activity-Based Costing component (CO-OM-ABC) under:

- Actual postings ® Variances ® Maintain target versions
- Actual postings ® Variances ® Maintain variance variants

See also the IMG for Cost Center Accounting, under:

- Actual postings ® Period-end closing ® Activity allocations ® Splitting

Creating Target Versions

Before you can calculate variances, you must set up a target version for the relevant controlling area. The target version determines the following.

– The versions the system uses for plan and actual data

– The version to which the system posts split actual costs and the variances

Moreover, you must specify the cost element group for which the first stage of actual cost splitting is performed, and the variance variant for which the variances are calculated.

Version 000 is the only version permitted for all plan, actual, and target versions. The system automatically sets any plan or actual versions to version 000. The target version is necessary nevertheless for standardization of variance calculation in the Cost Center Accounting and Product Cost Controlling components.

Assigning Variance Variants to Target Versions

The variance variant controls which variance categories are to be calculated.

Determining Splitting Rules in Splitting Structures

You assign splitting rules to a splitting structure. You save the splitting structure in the cost center master data (see: Cost Center Master Data). The splitting rules you define determine the criteria for actual cost splitting on the activity types of a cost center.

See also: