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 Group Costing in Distributed Systems Locate this document in the navigation structure

Use

You can use the ALE functions to send cost component splits from local systems to a central system, and create a group cost estimate centrally (less any transfer prices).

Features

You can use the ALE functions in Product Cost Planning to supply information about the product costs of separate production planning systems to a central cost accounting system. ALE supports the sending of information about value-added portions.

Data Flow: Distribution of the Value Added to a Central Cost Accounting System

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First, cost estimates that are independent of each other are created in every plant and system where the materials are to be produced. If you want to create a group cost estimate in a central system, you must send the costing results (cost component split) from every local plant to the central system. You can use ALE for this.

If a plant receives a material from another plant, the price paid to the supplying plant may be a transfer price. However, a group cost estimate does not contain transfer prices and reflects only those costs arising in the group itself.

Because of this, you can only distribute the value-added portions from the local systems to the central system. You must therefore calculate the value added in the local systems for the materials to be sent to the central system. You can access these functions by choosing   Accounting   Controlling   Product Cost Planning   Tools   Material Costing   Determine value added.   By entering certain selection criteria, you can choose the cost estimates whose value added is to be sent to the central system. The value-added portions are transferred by the system in the form of an additive cost component split .

You can now send the additive cost component split by ALE to the central cost accounting system. There, you can create a group cost estimate, minus any transfer prices . A prerequisite is that material masters and BOMs have also been distributed and exist in the target system.

Note Note

For the purposes of group costing, the value added should not be recosted. This means that instead of reselecting routings, work centers, cost centers, activity prices and such, the value added portions distributed to the central system should be transferred. You achieve this by making no entries for routing selection in the quantity structure control in Customizing.

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Please ensure that you have specified in the valuation and costing variants additive costs are to be included in costing.

Example Example

You produce and cost the following in three decentralized plants and systems:

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  • Plant 1, system 1: material C, consisting of materials A and B

  • Plant 2, system 2: material E, consisting of materials C (from plant 1) and D

  • Plant 3, system 3: material G, consisting of materials E (from plant 2) and F

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You create a cost estimate for the material produced in each plant:

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  • The costs for producing material C in plant 1 are USD 6 . The material is sold to plant 2 for USD 10 (transfer price).

  • The costs for producing material E in plant 2 are USD 19 . The material is sold to plant 3 for USD 20 (transfer price).

  • The costs for producing material G in plant 3 are USD 27 .

You now calculate the value added in plants 1 to 3, and send it to the central system. Here, you create a cost estimate without the transfer prices, containing the value added distributed to the central system. A prerequisite is that material masters and BOMs for materials A to G have also been distributed and exist in the target system.

The costs for the manufacture of material G are USD 22 .

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