Objective and Scope

Objective of this Procedure

The purpose of this document is to support in the implementation of SWEEP Procedure for Solvay Companies, as well as explain how this works.

The implementation of SWEEP can be made using the reference documents: 

  • SBS-FRM-DRTR-02-016 PF1 Sweep Control to be loaded in GDrive
  • SBS-FRM-DRTR-02-017 Sweep PF1 Structure
  • SBS-TRN-DRTR-02-005 Sweep cycles Procedure WP1-PF1 
  • SBS-OP-DRTR-01-003 Create Cost Centers
  • SBS-FRM-DRTR-01-002 Requests for Cost tracking (Cost Center-WBS-Internal Order)

In this present document, there are some Frequently Asked Question (FAQ) also to support implementation phase, as well as a step-by-step to be used along with the FAQ.

Scope

This operating procedure (OP) applies to all Solvay companies inside SBS Scope in both legacies.

 

Main Part

SWEEP Cycle is a tool developed to give efficiency to a key step of the closing which is the transition between the assessment cycles and the preliminary P&L in SAP.

Remaining amounts in cost centers up to a certain threshold after assessment cycles are systematically allocated to a PIVOT Cost Center that assesses this to SG&A (R33310) as a CBS Non-Function expense and this is automatically reversed in the next month.

SC has to investigate the reason for the unbalance and apply a solution in the root cause until D10 of the same month.

 

Rules and Codification

SWEEP Cycle is applicable for remaining amounts in cost centers after assessment cycles up to 10k EUR per cost center and per cost element. These remaining amounts are allocated to a PIVOT Cost Center, which has the following codification:

  • PF1: EE800PIVOT (EE=Establishment Code);
  • WP1: CCCC-5998 (CCCC=Company Code);

This entry has to be made using the original cost element causing the unbalance.

Also, it has to be immediately reversed to the next month, therefore, transaction FBS1 is always recommended whenever it is possible. 

This cost center is then assessed by the SWEEP Cycle, which has the same codification in both systems: CCCC-S (CCCC=Company Code).

 

 

 

When the SWEEP Cycle runs for next month (which has to be done in the next closing, never before that), this amount in P&L will be automatically reversed 

A definitive solution for the issue must be implemented until D10 of the same month. 

 → SWEEP Procedure is not applicable for the year-end closing; 

 → Production Cost Centers in PF1 are still allocated via Clearing Cycles, therefore, these ones are out of SWEEP Scope.

 

Instructions for implementing SWEEP

Identify the companies for SWEEP Implementation

Analyze the companies within the Service center scope on which the SWEEP Procedure might be helpful for the closing optimization, considering the following criteria:

  • Unbalanced cost centers in a regular basis after cycles;
  • Huge number of cost centers due to a complexity of the company;
  • Large volume of amounts in the company’s books every month;
  • Need to improve efficiency in this specific part of the closure; 

 

 

Request the PIVOT Cost Center Creation using Costing forms

Remark:  as we are in an “exceptional” case where the new Pivot CC creation is related to a “Process harmonization” need (not coming from Controllers request), the BO can prepare the request in the Workflow DMR and ask to submit to PE Costing.

 

 

Schedule a meeting with RCOM

First meeting has to be scheduled with the Regional Costing Manager(s) to ensure coordination and alignment in the procedure implementation across the region.

It is important to have their support, since they are the point of contact of the Controllers in the region and know well the costing structures and needs of the business. The RCOMs must also be invited to the meetings with CAMs and GBU’s. 

 

 

Schedule the meetings with CAMs and Business Controllers

After the cost centers creation (or request for creation) and agreement from the Regional Costing Manager(s), meetings with CAMs and Business Controllers have to be scheduled in order to communicate the procedure. 

 

 

Implementation

Once everyone agrees in the implementation, Back Office has to make sure the cost centers are created in the correct validity date and cycles are properly setup to be used in the month, as well as the Monthly Excel Controlling.

At this point, Country Teams have to be informed of the implementation and how to use it. 

 

 

Follow-up

Follow-up the first month of implementation to make sure everything will run OK and report to the Project Team.

 

 

FAQ – Frequently Asked Questions

Threshold is 10k EUR (plus or minus, negative or positive) per cost center and cost element/account.

No, it is not. Remaining variances in Production Cost Centers are still balanced with clearing cycles.

In a year-to-date view, the impact is zero, since the SWEEP Procedure is reversed in the next month.

It is not used in the Year-End closing in order to not reclassify unbalances from one year to the other.

No. This procedure aims to help in the closing efficiency, which means that if there is any other better solution for the case, it will be taken into consideration. (e.g. In case it is faster to solve the unbalance of the cost center before proceeding with the closing, and it is only one or a few number of cost centers on the month, this will be done instead of the SWEEP).

 Threshold is 10k EUR (plus or minus, negative or positive) per cost center and cost element/account.

 Threshold is 10k EUR (plus or minus, negative or positive) per cost center and cost element/account.

 

R: 

 

 

R: No, it has other specific purposes. However, for the time being it has its usage restricted to the SWEEP Procedure. In the future, the other purposes of the PIVOT Cost Centers will be deployed in a proper timing.