Business Context and Application Overview

Within Solvay, Corporate Business Services- Function cost application is a part of the Finance domain and uses data from various systems such as SAP systems, data from Cost Centers, Orders and WBS (SAP PS).

The Corporate Business Services are activities which combine or consolidate certain enterprise-wide needed support services, provided based on specialised knowledge, best practices, and technology to serve internal (and sometimes external) customers and business partners.

This Function is split in 4 parts:

Corporate (not re-invoiced)
Function services (re-invoiced and under guarantee)
R&D and engineering projects
Interco flows - It allows the identification of inter-company billing at company level

Application User Profile

For this Application the access is provided based on the BW menu "CBS - Function Costs" and it's done via Service one.

Fill the form
https://solvay-dwp.onbmc.com/dwp/app/#/itemprofile/622

In SAP system select the "WBP - BW Business Warehouse"

In WBP - BW Business Warehouse : Select the Business Role select the "CBS - Function Costs"

Target Users:

Users of this application include Corporate Controlling Controllers, Function Controllers, Plant Controller, Accountants and GBU controller

VERSION	DATE	MODIFIED BY	DESCRIPTION
0.01	15.09.2023	Inês Vilares	Initial draft

Application Type

Data Product Type

Dashboard
Report
Advanced analytics
AI
Others <specify which one>

Technologies

BW
Tableau
Qliksense
Talend
Dataiku
Others <specify which one>

Data Sources

Note: list of all applications and various environment

SAP PF1 (Production environment)
SAP WP1
SAP PI1
BW (versions)
iCare CRM
CORE CRM
Others <specify the name of the source>
Cytec Flatfile

2.0 Business Process

To understand the business process it's important to know the basic concept for the SAP CO module and how it's applicable in Solvay organization.

The SAP CO module in the SAP ERP (Enterprise Resource Planning) system focus on financial controlling and management accounting functions within an organization. SAP CO is designed to provide tools and capabilities to effectively manage and control costs, perform internal and external accounting, and support decision-making processes related to financial aspects of the business. SAP CO is tightly integrated with other SAP modules, such as SAP FI (Financial Accounting) and SAP MM (Materials Management), providing a cohesive and comprehensive solution for managing financial data, controlling costs, and supporting financial decision-making throughout the organization.

CO Structure in Solvay:

WP1 Structure

	Code	Description
Operating concern	Z001	Solvay Engin.Plasti.Polan
	Z006	Rhodia Europe
	Z013	Rhodia Europe
	Z025	Rhodia Latin America
	Z026	Rhodia Asia Pacific
	Z028	Solvay North America
Controlling area	= Operating concern

Overview of the business process for CBS functions costs

For the CBS function costs we use the SAP information from the controlling part. For this it's important to understand the structure behind and how the business see the costs and be able to analyze the information to perform their activities during and end of month.

Model behind for PF1 and WP1:

Curently we have the WBS, cost centers and orders objects with values coming from the purchase orders and accounting entries. Each object is linked to a cost center which we call it "Responsible Cost Center" and this cost center is linked to a GBU.

We have the primary postings and during the closing process we have the settlements cycles (which will allocate the costs to a final cost center) and the final cost centers has the correspondent cost element for COPA line items to be present in the P&L report for PF1 and WP1 using the respective value field.

Reporting fixed costs challenges : reconciliation SAP/BFC:

In the controlling side we have primary posting in the CO objects for the fixed costs and during the closing we have the settlement cycles to transfer/allocate the costs to a final CO object and to be in the respective lines in P&L.

3.0 Application Feature Overview

For this scope we are using queries instead of workbooks. See below all the queries available:

1 - Solvay Group Fixed Costs

Reports	Definition	Prompts	BW Workbook Query	Query Technical Name
CBS - Functions - during month (Core query)	In the report we can analyze the costs posted on function cost centers and CO objects with function CC as responsible CC for a specific period. No categorization of costs Highest level of detail: partner CO object The sign of the amount is seen from the function cost center ( +: costs increase / -: costs decrease) Default filters: 1 Organization ZCBS-CORPO ZCBS-FUNCT ZCBS-PROJ	Mandatory: Period/Fiscal Year. Optional: Auth Scope on Company Code; 1 Organization; GBU Function; Function Grouping; Function; 3 Sub-funct Grouping; 4 Sub-function; Company Code; Prompt Currency.	N.A	BW_QRY_MPR_FC001_0003
CBS - Functions - end of month (Core query)	In the report we can analyze the costs posted on function cost centers only for a certain period or periods after the settlements for the analysis on a end of month perspective. Categorization of costs following the structure described in the section ““Synthesis” & “Function – end of month” report”. Highest level of detail: partner CO object The sign of the amount is seen from the function cost center ( +: costs increase / -: costs decrease) Default filters: 1 Organization ZCBS-CORPO ZCBS-FUNCT ZCBS-PROJ	Mandatory: Period/Fiscal Year. Optional: Auth Scope on Company Code; 1 Organization; GBU Function; Function Grouping; 3 Sub-funct Grouping; 4 Sub-function; Function; Company Code; Prompt Currency.	N.A	BW_QRY_MPR_FC001_0001
CBS - Functions by Companies - during month (Core query)	In the report we can analyze the costs posted on function cost centers and CO objects with function CC as responsible CC for a specific period. Used more as a local reporting. No categorization of costs Highest level of detail: partner CO object The sign of the amount is seen from the function cost center ( +: costs increase / -: costs decrease) Same layout as “Functions – During the month” Default filters: 1 Organization ZCBS-CORPO ZCBS-FUNCT ZCBS-PROJ	Mandatory: Period/Fiscal Year. Optional: Auth Scope on Company Code; 1 Organization; GBU Function; Function Grouping; Function; 3 Sub-funct Grouping; 4 Sub-function; Company Code; Prompt Currency.	N.A	BW_QRY_MPR_FC001_0004
CBS - Functions by Companies - end of month (Core query)	In the report we can analyze the costs posted on function cost centers only for a certain period or periods. Used more as a local reporting. No categorization of costs Highest level of detail: partner CO object The sign of the amount is seen from the function cost center ( +: costs increase / -: costs decrease) Default filters: 1 Organization ZCBS-CORPO ZCBS-FUNCT ZCBS-PROJ	Mandatory: Period/Fiscal Year. Optional: Auth Scope on Company Code; 1 Organization; GBU Function; Function Grouping; Function; 3 Sub-funct Grouping; 4 Sub-function; Company Code; Prompt Currency.	N.A	BW_QRY_MPR_FC001_0002
CBS - Synthesis of the Functions (Core query)	In the report we can analyze the costs posted on function cost centers only for a certain period or periods. Categorization of costs following the structure described in the section ““Synthesis” & “Function – end of month” report”. Highest level of detail: cost center x cost element The sign of the amount is seen from the function cost center ( +: costs increase / -: costs decrease) Default filters: 1 Organization ZCBS-CORPO ZCBS-FUNCT ZCBS-PROJ	Mandatory: Period/Fiscal Year. Optional: Auth Scope on Company Code; 1 Organization; GBU Function; Function Grouping; Function; 3 Sub-funct Grouping; 4 Sub-function; Company Code; Prompt Currency.	N.A	BW_QRY_MPR_FC001_0005

2 - Solvay Group detailed Fixed Costs

Reports	Definition	Prompts	BW Workbook Query	Query Technical Name
BW - Detail costs by Orders - Rhodia (Core query)	The report is for Rhodia companies scope and show the costs for the selected order and all the details as partner cost center, partner activity, partner WBS element, partner order, CO document number and CO document line item for different periods in Amount (EUR) and Amount in Company Currency.	Mandatory: Order. Optional: Prompt Currency; Auth Scope on Company Code;	N.A	BW_QRY_MPR_FC002_0001
BW - Detail costs by Orders - Solvay (Core query)	The report is the same as "BW - Detail costs by Orders - Rhodia (Core query)" but the scope is for Solvay companies.	Mandatory: Order. Optional: Prompt Currency; Auth Scope on Company Code;	N.A	BW_QRY_MPR_FC002_0002
BW - Detail costs by WBS Elements - Rhodia (Core query)	The report is for Rhodia companies scope and show the costs for the selected WBS Element and all the details as compay code, partner cost center, partner WBS element, partner order, CO document number and CO document line item for last closing period in Amount (EUR) and Amount in Company Currency.	Mandatory: WBS Element. Optional: Prompt Currency;	N.A	BW_QRY_MPR_FC002_0003
BW - Detail costs by WBS Elements - Solvay (Core query)	The report is the same as "BW - Detail costs by WBS Elements - Rhodia (Core query)" but the scope is for Solvay companies.	Mandatory: WBS Element. Optional: Prompt Currency; Auth Scope on Company Code;	N.A	BW_QRY_MPR_FC002_0004

4.0 Functional Specification

4.1 General Data/Calculations

For these reports, it’s important to understand some general concepts which are transversal to all the reports which allows the users to work with the reports in the same way as the SAP system and BFC tool.

Cost Center	A cost center is a specific organizational unit within a company that is responsible for incurring costs. It represents a location, department, or function where expenses are generated. Cost centers are used for tracking and controlling costs, allocating expenses, and monitoring budget compliance.
Responsible Cost Center	A responsible cost center is a subcategory of a cost center that is responsible for specific cost incurrences within the main cost center. It allows for more detailed tracking and allocation of costs within a broader cost center. Responsible cost centers help organizations drill down into expenses for greater accuracy in cost analysis and control. Responsible Cost center is : - the cost center linked to the Order and WBS of the line item (CO-OM, PS) - the cost center of the line item for CO-CCA
Cost element	It's a categorization used to track and classify expenses incurred by an organization. It represents a specific type of cost, such as wages, materials, rent, or utilities, and serves as a fundamental building block for cost accounting and reporting. Cost elements are essential for allocating and analyzing costs within the SAP CO module. It's the P&L account used to post the amounts in SAP CO document.
Plant	Refers to a specific physical location or facility within a company's organizational structure.
Cost Center Hierarchy	Refers to a structured arrangement or organization of cost centers within a company. It establishes a hierarchical relationship among cost centers, typically based on their functions, responsibilities, or reporting structures. This hierarchy helps in organizing and managing cost centers efficiently for accounting, budgeting, and reporting purposes, allowing for better control and analysis of costs across the organization.

4.2 Process Detail

4.2.1. Report/Process Definition

Domain	Finance
Application	BW reports under CBS - Function Costs folder (queries option)
Provider	MPR_FC001 and MPR_FC002.

In this section we will approach:

SAP BW High Level View
Hierarchy
Restrictions
Function cost tracking reports
“Synthesis” & “Function – end of month” reports
Characteristics available in CBS reports
Cytect case for Non-ERP

For the CBS function costs application we have the PF1 and WP1 systems and we are using the main CO objects cost centers, WBS and orders and with this information extracted we the data is splitted in two BW tools one side the GBU fixed costs and the other solution is CBS for the functions (For the GBU fixed costs scope the explanation it is in the "GBU Fixed Costs application"). For both applications we use the same data base and the same cubes but the multiproviders are different also because of the authorization part.

SAP BW High Level View

To see the data from the source systems see below how the information is organized in the BW perspective:

Hierarchy

The below costs are included in the Corporate Business:

Actual costs only: Statistical costs are not taken into account
IFRS rules only: Costs posted using local gaap accounts are excluded (Brazilian entities)
Costs posted on CBS (Corporate Business Services) cost centers (directly or through orders or WBS). It corresponds to the cost centers included in the following groups of the cost centers hierarchy ZCBS:

- ZCBS-CORPO = Corporate
- ZCBS-FUNCT = Function services
- ZCBS-PROJ =Projects
- ZCBS-ICO = Interco
Costs are organized with the cost elements group ZRCS-FC
Inter-company re-invoiced function service costs should be posted on cost centers of the group ZCBS-ICO

In SAP using the transaction KSH3 - Display cost center hierarchy

In the Cost Element Hierarchy from 01 Jan 2022 the Cost Element Group ZRCS-FC it was replaced by the Cost Element Group ZSOLV. In the reports we have information for the ZSOLV group but the reports are still working for the filters and key figures with the old group. Discussions are on going to see the best solution to have the reports adapted with the new group ZSOLV.

Restrictions

To determine CBS Fixed Costs perimeters, there is restrictions on:

Cost center
Cost element
Miscellaneous filters

In CBS application the CBS hierarchy for PF1 and WP1 systems in BW was denormalized (levels of the hierarchy are translated as attributes of cost center and responsible cost center):

Cost centers hierarchy/restriction for this scope:

Restriction on cost element:

In the cost element BW object the cost element hierarchy was denormalized (levels of the hierarchy are translated as attributes of cost element).

By default we must excluded some “Fixed cost group “ attributes values in the reports. The users can delete these default filters.

Cost element hierarchy ZRCS-FC : restrictions:

Miscellaneous filters:

Order Type : we exluded (investment) :

ZPM4
ZPM6

Project Type we exluded (investment) :

II
FD

Value type

10- Real
20-plan

Currency type

10 company code currency

Function cost tracking reports

Design

5 queries available, corresponding to 2 approaches

Point of entry : function(s) or company(ies)
End of month (final settlement on function CC) or During the month (link to function CC before settlement)

		End of Month	During the Month
		to be used for reporting after the closing when all costs posted in orders are settled on CBS cost centers	to be used during the month when orders are not yet settled
By Function	function controlling	BW_QRY_MPR_FC001_001 BW_QRY_MPR_FC001_005	BW_QRY_MPR_FC001_003
By Function	corporate controlling
By company	local controlling	BW_QRY_MPR_FC001_002	BW_QRY_MPR_FC001_004

BW_QRY_MPR_FC001_001 CBS Functions - end of month => for reporting to corporate controlling

BW_QRY_MPR_FC001_002 CBS Functions by companies => for reconciliation FC vs BW

Possibility to analyze a “one-level-up” cost cascade

Data

CO documents: actual costs in local currency + report in other currency with BFC exchange rate
Entries on Cost Centers, Orders and WBS elements
Postings to COPA & Local Gaap cost elements are excluded

“Synthesis” & “Function – end of month” reports

Additional axis : Structure with 6 categories

	Category	Definition	Example
(1)	Gross	All costs excluding depreciation before any deduction (sales, capitalization, etc…)	all labour costs + travel + services + …
(2)	Depreciation	Postings with depreciation cost elements	depreciation costs
(3)	Sales	postings with sales cost elements (excluding capitalization) + postings with all other cost elements linked to Invoicing WBS element (partners with object class “Profitability Analysis”)	activity (man Hr) posted on invoicing WBS -> time spent on IT project reinvoiced to customer
(4)	Costs going to be capitalized	postings linked to Investment WBS or Orders (partners with object class “Investment”)	activity (man Hr) posted on investment WBS -> time spent on IT project for development phase
(5)	Cost transferred	Credits from overheads CC WBS IO (partners with class object “Overheads” - excluding sales cost elements)	activity (man Hr) posted on overhead WBS -> time spent on IT project for training phase
	Net Function	Balance of the cost center	(1) + (2) - (3) - (4) - (5)
	postings on function CC from WBS or internal order settlement are classified in Gross

Characteristics available in CBS reports

Characteristics		Synthesis	Functions - End of month	Functions by Companies - End of Month	Reports - During Month
0 – Hierarchy	Level 0 of ZCBS hierarchy	X	X	X	X
1 – Organization	Level 1 of ZCBS hierarchy	X	X	X	X
2 – Function	Level 2 of ZCBS hierarchy	X	X	X	X
3 – Sub-Funct Group	Level 3 of ZCBS hierarchy	X	X	X	X
4 – Sub-Function	Level 4 of ZCBS hierarchy	X	X	X	X
Controlling area	Controlling area of the function CC	X	X	X	X
Company	Company of the function CC	X	X	X	X
Country	Country of the company	X	X	X	X
Geographical zone	Zone to which the country is attached	X	X	X	X
Cost center	Function cost center	X	X	X	X
Fixed Cost Group 1	Level 2 of ZRCS-FC hierarchy	X	X	X	X
Fixed Cost Group 2	Level 3 of ZRCS-FC hierarchy	X	X	X	X
Fixed Cost Group 3	Level 4 of ZRCS-FC hierarchy	X	X	X	X
Cost Element	Cost element used to post function costs	X	X	X	X
Partner Cost Center	Cost center with which the function CC exchanges costs (credit or debit)		X	X	X
Partner Activity Type	Type of activity used to transfer costs to the function CC from a partner CC		X	X	X
Partner WBS element	WBS with which the function CC exchanges costs (credit or debit/Posting or settlement )		X	X	X
Partner Order	order with which the function CC exchanges costs (credit or debit/Posting or settlement )		X	X	X
Partner Vendor	Vendor in purchase flows		X	X
Sender / Receiver	indicator that identifies the direction of the posting		X	X	X
Responsible Cost Center	Function CC responsible of an order or a WBS element				X
WBS element	WBS element with a function CC as a responsible CC				X
Order	Order with a function CC as a responsible CC				X
Cost Structure	slide ““Synthesis” & “Function – end of month” reports	X	X

Cytect case for Non-ERP

Cytec transaction in CBS was developped for cytec and after used to load non erp data (no new data was loaded from 2020).

CBS - Function costs - Troubleshooting

On 27 Jul 2018, some users of the application CBS - Function costs were not able to refresh their personnal workbook created with the query BW_QRY_MPR_FC001_0001 CBS - Functions - end of month (Core query)

You can find below how this issue can be solved.