Tasks to be completed when documenting an operation (from creation to publication)

 1. Enter the Title of the operation / page

2. Add the following Labels : 

    • Scope of applicability: ww, country_accounting 

    • Country or group of countries (if applicable): belux, china, france, italy, lam, nam, uk_ie, bulgaria, dach, netherlands, iberia, poland, latvia, australia, india, japan, south_korea, thailand, singapore

    • Unit and Domain according to the List of labels to be used in the Finance Service Line space

      • E.g. 1: WW Operation in Financial Accounting under domain "Central Finance Processes & Compliance":
        • Labels to be used: ww, financial_accounting, central_fin_proc_compliance

      • E.g. 2: France Operation in Financial Accounting:
        • Labels to be used: country_accounting, france, financial_accounting
          (for country operations, the Domain is always country_accounting)


3. Fill in all fields as described above

 4. Once the description of the operation is completed, ensure it is approved and published by launching the SBS-Finance approval workflow 




Domain: Country Accounting



Responsibility area: N/A


Table of contents 

By default the table of contents displays Heading 1 & Heading 2 (other levels can be added)



Scope

3. Remove the icon when not applicable


ERP

4. Remove the icon(s) when not applicable


Frequency

5. Remove the icon(s) when not applicable


References

6. Add the link to SAP transaction(s) (when it exists)

ZWFA15P


Forms

7. Insert the links accordingly and change the link text with the OP name

FI CO Cogs - Entries


Attachments

NAM COGS Entries Control

Monthly Control File (link to the file)(error)



Previous OP << >> Next OP



1. Objective and Scope

1.1. Objective of this Operation

Reconcile FI and CO modules in SAP for transactions impacting Cost of Goods Sold (COGS).

1.2. Scope

This document applies to companies 7424, 7008 and 7752.


2. Definitions

See Finance Glossary:


3. Tasks description

3.1. Responsibilities

In a monthly basis, SBS Service Center NAM Team runs FI-COPA COGS Results by plant in order to make the corrections to align both modules.

Task is reported to SBS NAM Regional Costing Manager, who has to validate it after the entries are posted.

Whenever permanent actions are to be taken, Controllers have to validate the corrections, as responsible actors in each plant books.

3.2. Reconciliation

This reconciliation intends to track down differences in Cost of Goods Sold (COGS) between FI and COPA.

It occurs after the following Closing Steps are completed:

  • Ship Not Billed completed: Correction of inconsistencies in what was shipped and not effectively billed at material and plant level;
  • Sales are closed: All sales for the month are reported and period is closed;
  • MMRV Closed: Material period is closed, so no further movement is posted.

3.3. I identify differences in SAP

Differences are displayed in transaction ZWFA15P, with variants below related to each company:

  • SCMA_7424_COGS  
  • SCMA_7008_COGS
  • SCMA_7752_COGS

~


Selection is:

  • Selection Criteria

ALV Variant: /ZWFA15RMAT

Company Code: 7424 / 7008 / 7752 

Period: Closing Period (MM.YYYY)

Limit: 0,01

Flag “Only variances”: checked


  • Data PA

Operating Concern: Z028

Record type: F, Z and B

Currency Type: 10


  • Data FI

Document Type: WA and WL

Movement code: 453 to 460

Account number: 98150363 and 98150364


  • Manual adjustment postings

Document type: AD

COPA account number: 98154199, 98254199 and 98258199

FI account number: 98350011, 98350050 and 98350055

Cost Center: 7424-9200 / 7008-9200 / 7752-9200


  • Stock in transit selection parameters

Document type: SA and SB

Account number: 98350080

Flag “See Stock In Transit Document”: Checked



After all this is selected, execute the transaction.

Output will be a table drilled down by plant and material.

For those plants in which a difference is seen, open the field to see by material, since corrections need to be done at material level.

Consider a threshold of 100,00USD.

3.4. I identify the cases to be correct

3.4.1. I identify the 1st Case - Shipments not billed and not picked up in the Ship Not Billed process

These are cases in which the sales order is executed, material is sent out for shipment from the stock, but no customer billing is issued.

  • Correction: Book a reversing entry (Accrual) with document type “AD” to recognize the billing in the closing period.
  • Correction type: Temporary. One entry per each material and plant, reversed in the next month. 

3.4.2. I identify the 2nd Case - “KEN” Item Category Document: Customer Consignment Inventory

Inventories located at customer warehouse per consignment contract, normally the monthly invoice is issued at the last minute of the month and sometimes it crosses two different periods due to timing constrains.

The CSR team needs to wait until D1 to get the information needed for billing.  They normally do this billing on Day 1, but they have to back date to the end of month to eliminate any FI-CO COGS issues.

  • Correction: Same entry and requirements as the 1st case above.
  • Correction type: Temporary. One entry per each material and plant, reversed in the next month. 

3.4.3. I identify the 3rd Case - “TAN” or “RTN” Item Category Document: Customer Return

Whenever a good is returned from customer it has to be blocked before becoming an effective inventory again, following this sequence:

  1. Blocked for inspection;

  2. Blocked for quality;

  3. If the good is OK and credit was effective, turn into physical inventory with no use restriction.

 

Until the 3rd phase occurs, there is a credit note posted to customer in SD (FI) and Inventory is not back to available.

Controllers follow-up during the month this kind of issues – customer returns.

  • Correction: Same entry as the 1st case, however, the credits and debits might go in different directions as the normal cases, depending on what is missing: credit note or returned material;
  • Correction Type: Temporary. One entry per each material and plant, reversed in the next month. 

3.4.4. I identify the 4th Case - Cost Difference

Shipment and invoice have crossed two different periods; i.e. reversal of invoicing accrual posted in the previous month and real shipment posted in the current month, therefore, they worked with two different prices leaving a small difference to be corrected.

  • Correction Type: Permanent. One entry per each material and plant, never reversed.

3.5. I post the entries (please confirm the title)(error)

3.5.1. I post temporary entries (please confirm the title)(error)



Indicator

Account

Cost Center

Material #

Profit Center

Assignment

Dt

37000109

 

X

X

X

Cr

98350050

CCCC-9200

X

 

x


 CCCC - company code, the cost centers are:

  • 7424-9200
  • 7008-9200
  • 7752-9200

Debit – Account 37000109 FINISHED PRODUCTS-ADJUSTMENT, which is the stock part

Credit – Account 98350050 FINISHED PRODUCT STOCK VARIATION-COST OF SALES ADJ, which is the COGS part of the adjustment


The “Xs” in the table above represent what information needs to be provided in each part of the entry.

In the 3rd case (Customer Return) debts and credits might be in opposite position as all the others.

3.5.2. I post permanent entries (please confirm the title)(error)

Correction has to be posted on the following accounts and parameters:

  • Indicator: Debit or Credit, depending on the difference balance
  • Account: 98350011 – CP Adj. COPA (Variable Cost) – FI part
  • Cost Center
  • Assignment: Enterprise Code
  • Material Number


  • Indicator: Debit or Credit, depending on the difference balance
  • Account: 98154199 – Finished Products Stock Variation (COPA Impact) – COPA Part, Value Field D45
  • Profit Center
  • Assignment: Enterprise Code
  • Order Number (Profit Segment)
  • Product Number (Profit Segment)
  • Ship to (Profit Segment)
  • Sold to (Profit Segment)
  • Payer (Profit Segment)
  • Distribution Channel (Profit Segment)
  • Country Payer


There are two ways to post the entry above:

  • Correct information: Once you have all the data to fill in the profit segment, which can be retrieved from KE23N when displaying the PA document related to the issue;
  • Fake/Dummy data: General information to be inserted for this kind of information:


Dummy data:

  • Payer: 999930
  • Customer: 999930
  • Country Code: US
  • Distribution Channel: 10
  • Ship to: 999930
  • Product number: Material
  • Sales Order: Not needed
  • Sold to: 999930


Best practice: describe on field “text” the case to which the difference refers to.

3.6. I fill the "Monthly Control File" in G-Drive

Monthly Control  file (please link to the file)Error (x) is in the attachment of this procedure and has the objective of maintaining a good follow-up of the differences in each month.

Following fields have to be completed: 

  • Document of the issue (blue)

Plant code

Material

Sales document

Profit Center

Amount in USD

PA Doc Associated

FI Doc. Associated

Month.Year


  • Correction document (gray)

Temporary or Permanent Correction (T/P)

Case (not Salesforce, but to which type of case it refers to)

Correction doc. Number

Numbers of occurrences

Statu

Comments


  • RCOM Input (blue)

RCOM Validation

RCOM Comment if KO


This information has to be crossed with accounting books in SAP, mainly for account 37000109, on which the open items need to net in zero.

After 3 occurrences of a determined correction (3 months in a row), situation has to be escalated to plant controller, proposing to write-off the balance, as it indicates that no counterpart will be posted.


End of document.