Purpose

For primary cost planning related to cost center accounting, you need to forecast future depreciation. Therefore, you can determine planned periodic depreciation and interest for any Asset Accounting depreciation area. The depreciation area has to be a real depreciation area, not a derived depreciation area. Using a special report ( Periodic Processing ), you can transfer this depreciation and interest to the Controlling (CO) component. There is an indicator in the report request screen you use to specify if planning should take place on cost centers or on orders.

Process Flow

The way the system determines planned depreciation for this purpose is similar to the way it simulates depreciation. For more information, see Depreciation Forecast and Depreciation Forecast with Planned Investments and APC Values for Planned Investments .

The transfer report plans the depreciation, using the appropriate cost element, on the cost center or order. The report overwrites any existing panned costs for this cost element (meaning that the new costs are not added to the existing costs). When you run the report in update mode and it is not possible for the report to transfer certain values, the report terminates and issues an error message. After you correct the error, you can restart the report for the original dataset. This does not present a problem, since the plan values that were already transferred are now overwritten (rather than being added to).

Planned Investments

If you are using the Investment Management (IM) or Overhead Orders (CO-OPA) and Project System (PS) components, you can also include the simulated depreciation and interest derived from the planned values of investment measures and investment program positions, in addition to those of capitalized assets, in primary cost planning. You can choose whether the system uses the budgeted values or plan values as the APC for planned capital investments. You make this specification when you start the report. When the simulation is based on plan values, you can also specify the plan version to be used.

In order to carry out primary cost planning with planned investments, the requirements below must be met:

Capitalizations in the Current Fiscal Year

The system bases the calculation of the APC basis for the depreciation simulation of planned investments on the plan values or budget values.

The system does not normally adjust these values for orders or WBS elements when part of the planned investment has already been capitalized (that is, settled to capitalized assets). For a depreciation simulation that includes capitalized assets and planned investments at the same time, this could cause problems. The system would include the plan or budget values from the order or WBS element along with the values from the capitalized asset. As a result, the already capitalized values would be duplicated.

In order to prevent duplications, there are two options in the initial screen of the depreciation simulation for handling capitalizations in the current fiscal year:

You specify the method you want to use by setting that indicator in the initial screen before starting the depreciation simulation.

Refer to:

For more detailed information on the logic used for the calculation, refer to Depreciation Forecast with Planned Investments . Also refer to the field documentation for the related indicators.

Determination of the Cost Center or Order

For capitalized assets, the system plans on the cost center or order that is entered in the asset’s time-dependent data, and which is valid during the planning time period. For planned investments, the system uses the cost center or order in the depreciation simulation data (the receiving cost center/order).

The assets, orders, and projects, for which the system cannot determine a cost center or order, are listed in the log under the cost center (or order) ?????????? . This is a problem particularly for orders for which you have already entered explicit settlement rules. The system can no longer determine a cost center for these orders, since the settlement cost center is no longer available from the order master record. The system lists records under the cost center (or order) ?????????? in the log, but the values for these records are not included in the transfer to the Controlling (CO) component during an update run. You need to perform a manual follow-up, in which the costs from the log are planned for the desired cost centers.

Activity Type

You can request activity-type dependent and/or activity-type independent planning.

Planning takes place in the cost center, independent of the activity type. Any activity types in the asset master record are ignored.

Planning takes place in the cost center, dependent on the activity type. Any asset master records without activity types are ignored.

Costs for assets with activity types are planned in the cost center, dependent on the activity type. Costs for assets without activity types are planned in the cost center independent of the activity type.

Distribution Key

If you specify a distribution key when starting the report, values are determined based on the time period specified in the from/to period. The values are then distributed according to the distribution key to the individual periods. If you do not enter a distribution key, the system determines the values individually for each period in the specified planning interval.

Separation of Fixed and Variable Costs

It is basically possible to separate the depreciation of assets into fixed and variable portions (refer to Depreciation for Multiple-Shift Operation and Shutdown ). This separation is also recognized in primary cost planning. The report calculates the pure fixed cost portion along with the total costs. The variable costs are determined, according to the definition, as the difference between these two values. However, the system only calculates fixed costs separately if the following requirements are met:

Changing the Cost Center in the Asset Master Record

The assignment of the asset to a cost center may change during the fiscal year. When this happens, the system recognizes the period in which the change took place. The following should be kept in mind:

If you do not enter a distribution key, then you only have to carry out a primary cost planning run for periods 1 to 12 at the same time.

Limits

You can limit the selection of assets in the initial request screen for the report. Limitations according to company code, asset class, business area, cost center and plant apply to assets as well as to orders or projects. Limitation according to location and asset super number applies only to assets. Also enter the depreciation area, from which the depreciation or interest that is being planned stems.

Enter the fiscal year, for which you are planning. The system determines the cost center/activity type for assets based on the cost center/activity type that is valid for the asset at the end of this fiscal year.

You can limit the planning to a given period interval in the fiscal year. If you do not make any limitation, the system plans for the entire fiscal year (from the first period to the last period).

Procedure

Carrying Out Cost Planning