SAPCO_overviewEN

ControllingOverviewReferent:CO-2CopyrightCopyright1995Coopers&Lybrand.Allrightsreserved.Neitherthistrainingmanualnoranypartthereofmaybecopiedorreproducedinanyformorbyanymeans,ortranslatedintoanotherlanguage,withoutthepriorconsentofCoopers&Lybrand.Theinformationcontainedinthisdocumentissubjecttochangeandsupplementwithoutpriornotice.CertainpartsofthistrainingmaterialaretakenfromSAPmaterial,madeavailablebySAPAG,forinternalusebyC&LUnternehmensberatung.CO-3IntroductionCostingmethodsResponsibilityAccountingProfitCalculationControllinginSAPProjectIssuesAgendaCO-4WhyCostControllingForstatutoryreasons:stockvaluationsFordecisionmaking(alsotacticalorstrategicdecisions)Forresponsibilityaccounting(controllingcostdeviations)CO-5Whatarecosts?ExpensesincurredintherealworldofbusinessThus:expensespostedinFI(asdebitonexpenseaccounts)Acquisitionofconsumergoods(non-asset)orsuppliesDepreciationofassetsgroupedbytopic(=costcenter)asa2ndsortkeyFIBUSINESSTRANSACTIONSExpense(inFI)COSTCENTERSSETTLEORDERSCostFlowSETTLETOASSETALLOCATECO-7ControllingwiththeCOsystemR/3SDMMPPQAPMHRFICOIMPSWFISClient/ServerABAP/4COEC-EISCO-OPACO-CCACO-ABCEC-PCACO-PCCO-PACO-8IntroductionCostingmethodsResponsibilityAccountingProfitCalculationControllinginSAPProjectIssuesAgendaCO-9CostingMethodsClassicalapproaches:AbsorptionCostingVariableCostingNewapproach:ActivityBasedCostingSAPallows...CO-10AbsorptioncostingAlsocalledfullcostingTheoldestandeasiestmethodAlldirectmanufacturingcostisattributedtotheproduct-materialcost-labour-machinetime-setup/teardownallindirectvariablemanufacturingcostisattributedtotheproductaportionoffixed(management)overheadisalsoattributedtotheproductCO-11AbsorptioncostingDirectmaterialcosts+=MaterialoverheadDirectlaborcosts+=ManufacturingoverheadCOSTING-SHEETMaterialcosts+Manufacturingcosts=Costsofgoodsmanuf.+Administrativeoverhead+Salesoverhead=CostofsalesCO-12AbsorptioncostingDirectmaterialDirectlabourManufacturingoverheadindirectmaterialindirectlabourrentofpremises/machinesdepreciationofpremises/machinesMANUFACTURINGCOSTPRODUCTCOSTSTOCKUNSOLDNONMANUFACTURINGCOSTPERIODCOSTEXPENSEDeliverycostMarketingcostSalescostSOLDSOLDCO-13AbsorptioncostingdirectcostsdirectcostsdirectcostsdirectcostsdirectcostsMachinehourLabourhourSetup+indirectvariablecostRawmaterialcostpostedproduction-relevantFixedoverheadapportionableoverhead%apportionSurchargeMANAGEMENTCLEARINGPRODUCTIONORDERSOPERATIONSe.g.FINISHEDPRODUCTSPressingweldinglathingassemblingQIP1P2CCCCBOMCO-14PRODUCTIONOverheadDetermination:basedonhistoricfiguresEssentiallya2-stageprocessOVERHEADCOSTPRODUCTIONDEPTPRODUCTIONPRODUCTIONDEPTPRODUCTIONPRODUCTIONDEPToverheadrateoverheadrateoverheadrateapportionAccrualCCWORKCENTERWORKCENTERWORKCENTERact.act.act.ProductionOrderProductionOrderRATEDOVERHEADHISTORYCURRENTCO-15VariablecostingAlsocalleddirectcosting&marginalcostingBasicidea:Forshorttermdecisions,onlythevariablecostarerelevantExample:LastminuteoffersConsequenceforcostingsheet:FixedoverheadisnotincludedinproductcostbutpostedasperiodexpenseFIXVARIABLEtotalcostsofproductonlythevariableportionisrelevantCO-16VariablecostingDirectmaterialDirectlabourManufacturingoverheadindirectmaterialindirectlabourrentofpremises/machinesdepreciationofpremises/machinesMANUFACTURINGCOSTPRODUCTCOSTSTOCKUNSOLDNONMANUFACTURINGCOSTPERIODCOSTEXPENSEDeliverycostMarketingcostSalescostSOLDSOLDCO-17Activity-BasedCosting(ABC)ABC(apparently)supportsstrategicdecisions.ABCfocusesonindirectareas,henceisespeciallyinterestingforservicecompanies.ABCmeasuresthecostandperformanceofbusinessprocessesandcostobjects.ABCassignscoststobusinessprocessesbasedontheiruseofresources.Thecostsincurredbybusinessprocessesareassignedtocostobjects(suchasproducts,services,customers,orders,etc.)basedontheirutilizationoftheseprocesses.CO-18Activity-BasedCostingG/LaccountsCostcenter1Costcenter2Process1Process2Costobject1Costobject2Costobject3Costcenter3usingactivitytypescostobjectcontrollingABCFICO-CCACO-19Determinationoftheconsumer-producermodelthatappliestoagivenorganizationisessential=BusinessProcess(re)EngineeringEspeciallyusefulforserviceorganisations,majorityofcostsarefixed,itisnecesssarytotracecoststoindividualproducts/servicesThuscostsperbusinessprocesscanbecontrolledaswellascomprehensivemanufacturingandsalescost.ABCdoesnotprecludecostapportionementofcosts(!)InstallingandrunningABCisexpensive.Onemustinvestigatethecostofgettingtheinformation!Activity-BasedCostingCO-20TraditionalCostAccountingExample:ReshapingofdatausingABCSalesDepartmentSalary&Wages:$320,000Benefits:$110,000TravelExpenses:$50,000Total$480,000ActivityBasedCostingManufacturingDepartmentDirectLabor:$250,000IndirectLabor:$330,000Depreciation:$100,000Total$680,000AccountingDepartmentSalary&Wages:$250,000Benefits:$80,000TravelExpenses:$50,000Total$380,000EngineeringDepartmentSalary&Wages:$300,000Benefits:$100,000TravelExpenses:$60,000Total$460,000TraditionalIncomeStatementSales:$3,500,000CostofSales:Directlabor:$250,000ManufacturingOverhead:$430,000Ma