2.0 Business Process

CO Structure:

Overview of the business process in P&L

In the process the data is in the SAP CO module where we have the different phases until the information has the struture aligned with BFC to become in the end the final data to be reported.

Cost objects controlling:

A cost object can be used to analyze target costs, actual costs, and variances in situations where costs are not collected at the level of orders or materials. For example:

• Fixed costs and activity costs planning;
• Actual costs postings from cost centers, orders, projects;  

Product Costing: 

The flow of the product costing is composed of a series of standard transactions which are interconnected. This requires the processing in a certain sequence. The procedure starts in the cost center accounting referring to so-called production cost centers. Defined activity types are assigned to these cost centers. For the daily movements the activity prices are valuated at standard cost. In the closing of the product costing they will be revaluated at actual prices. The differences are credited on the production cost centers and debited on the production cost collectors, managed in the cost object hierarchy.

The procedure continues with the distribution of postings of actual costs on the cost object level to the assigned cost collectors.

All categories of variances between target costs and actual costs, like price and quantity variances in raw and packaging materials, same for consumed activities are calculated within the cost object hierarchy and posted on cost collectors. As the cost collectors are a certain kind of order, they must be settled at the end of the period.

Intermediate checks take place in order to look at the ‘zero’ balance of the cost accounting objects involved.

To see more detil information about the process please check in the wiki page for "Costing - Knowledge Base".

Profitability Analysis (CO-PA): confirm with business

CO-PA provides P&L information by market segment or strategic business unit, such as enterprise, company code, plant, and other dimensions defined in the system. In the context of the PF1 and WP1 systems, CO-PA is used to produce the P&L statements and FC interfaces (costing based version).To ensure the correct mapping and alignment with FC requirements, a list of value fields is maintained in CO-PA. These value fields represent different components of costs and revenues, which are essential for generating accurate and detailed P&L statements and facilitating the interface with the FC system.

The data from the cost objects that have already been processed through product costing in SAP will provide the necessary information in CO-PA. This data will be aligned with the structure required by the BFC (Financial Consolidation) system to present financial reports.

By using the value field concept and custom tables ZWFAT110 for WP1 and ZZF_BFC_COPA_VF for PF1, the CO-PA data is mapped and transformed to match the structure and requirements of the BFC structure. This ensures that the financial reports generated by the BFC system will be accurate and reflecting the profitability analysis performed in CO-PA while taking into account the specific needs of financial consolidation and reporting.

In summary, the integration between CO-PA and the BFC system allows for a seamless flow of data, providing valuable insights into profitability and facilitating the preparation of comprehensive and accurate financial reports for the organization.

Reports:

PF1 and WP1: CO-PA P&L reports: KE30

WP1: CO-PA line items: KE24

PF1: CO-PA line items: KE23N

3.0 Application Feature Overview

Below we have all the workbooks available:

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.

4.2 Process Detail 

4.2.1.  Report/Process Definition 

GBU Assignment

See below the logic for WP1 and PF1: 

PF1 Logic:

In PF1, the determination of the business structure is done in the P&L (KE30 - Profitability report) using the profit center of the COPA posting. 

Partner Activity

Identify the business to which the amounts are allocated in the Solvay partner company in cross-company flows.  See below the different logic for WP1 and PF1.

Determination of the partner activity in WP1

01 - vente intra cdp

10 - vente inter entrepr.

13 - Vte OMC zone EUROPE

15 - vente inter cdp

Overview - determination of the partner activity in WP1

Determination of the partner activity in PF1

Overview - determination of the partner activity in PF1

Non-ERP data in P&L:

Procedure to upload manually data from systems not interfaced with WBP.

On the business side they need to fill 3 dedicated templates to upload the data into WBP:

• For customers master data: NON ERP - Model Customers master data 

• For material master data: NON ERP - Model Materials master data

• For P&L data: NON ERP - Model structure of the P&L

For this, they need to also have in consideration the following information:

When everything is ready the users can go to WBP systema and use upload the file in the transaction ZPL_FILE. Once it is done a message is displayed to inform that the file was sent to BW and will be available in  the reporting at the next data loading. 

Data loading time: 12am / 1pm / 6pm (french time)

Exchange Rates in P&L

CAR3 - Monthly Rate

C - Year-to-date Monthly Average Rate

BFC Methodology 

Example

2 materials are sold in USD with the following contribution margin in local currency in Q1 2019:

The rate C by month is: 

In February, the contribution margin (=CTN) of the material 11365 OT MET.DRUM 225L is

= (CTN 01.2019 + CTN 02.2019) x Rate C 02.2019 - CTN 01.2019 x Rate C 01.2019

= ($ 26 560,00 + $ 13 280,00) x 1,138501 - $ 26 560,00 x 1,141686 =  11 729,54 EUR

BW is doing the calculation item by item.

In February the CTN of material code 11366 DISTIL. BULK. = ($ 557 522,40 + $ 387 991,60) x 1,138501 - $ 557 522,40 x 1,141686 = 342 157,77 EUR

P&L at Sales Order

This part was included in P&L scope to have in the report with four new fields:

• Sales Order
• Item Order
• Market Cluster
• Team Cluster

This is available in the Workbooks for P&L Integrated Margin - CM/GM Query by Sales Orders and P&L Integrated Margin - Monthly CM/GM Query by Sales Orders since in here we have the information for the P&L structure not only the regular P&L headings but also considering the integrated margin process which is explained in the Functional Documentation - Profit and Loss Integrated Costs.

Should I add this list for the characteristics? 

4.2.2. KPI's/Calculations/Indicators  - Double check this part

Indicators available: 

• XXX
• XXX

5.0 Non-functional Descriptions 

5.1 Usability 

Usability is about the ease with which a User can learn to start using the solution and the ease with which they can use the system.  In addition to ease of learning and ease of use, usability also includes areas such as ease of recall, error avoidance and handling, accessibility among others e.g., 99% of metadata entry Users who have use the Maintenance Dashboard should be able to change filters, extract etc., when required.  Maintenance data will be centrally stored in the Google Cloud platform, which will be available to other applications e.g., and Dashboards if needed.

Software systems must comply with legal and regulatory e.g., GDPR requirements, this can change depending on country, organisation industry and / or region.  The software systems must be secure from unauthorized access.  The Maintenance Dashboard will comply with Solvay’s regulations and compliance e.g., access only granted to authorized Users.

5.3 Security

Security refers to essential aspects that assure a solution and its components will be protected against unauthorized access or malware attacks.  Important considerations related to security aspects of a system are User authentication, User authorization or User access privileges, data theft, malware attacks, data encryption, and maintaining audit trails, e.g., only Users with administrator access shall be able to create new accounts and assign data access privileges to the new accounts e.g.,

• All data will be encrypted in the dashboard

• Only authorised Users / Administrative Users will be able to access data.

• Maintenance data will be split between either SCO or ECO, and Users will only have authority to one Entity data.

5.4 Performance

Performance defines how fast a software system or a particular section of it responds to certain User actions under a certain workload.  In most cases, this metric explains how long a User must wait before the target operation happens e.g., the page renders, a transaction is processed, etc., given the overall number of Users now.  Performance requirements may describe background processes invisible to Users, e.g., backup and speed of data transfers. 

5.5 Reliability

Reliability is the ability of a solution or its component to perform its required functions without failure under predefined conditions for a specified time / period.  Reliability can possibly be specified in terms of average time system runs before failure occurs, percentage of operations completed successfully within a time / period, maximum acceptable failure probability, or number of failures within a period.  Reliability aspects are in reference to (but not limited to) evaluation of the system to be considered as reliable, classification of reliability defining failures vs. regular failures, and the impact of failure on business operations.  The Maintenance Dashboard will display data from the previous refresh of data.   

5.6 Scalability

Scalability refers to the degree to which a solution can evolve to handle increased amounts of work.  The increased amount of work could be in terms of the user base, transactions, data, network traffic, or other factors e.g., the system should be able to handle an additional load of a maximum of 5,000 Users every month for the next 6 months without any noticeable performance impacts.  

5.7 Compatibility

Interoperability is the degree to which the solution is compatible with other components.  It is a measure of how effectively the system interoperates with other software systems and how easily it integrates with external hardware devices.

Interoperability aspects to be discussed during elicitation are in reference to (but not limited to) software systems to be interfaced with along with data / messages to be exchanged and any standard data formats, hardware components to be integrated with, and any standard communication protocols to be followed e.g., Order Management system will push the order file into a secured file transfer protocol server from where it will be loaded into the system through a daily job.  To guarantee between Google Cloud platform and SAP BW Queries e.g., BW_QRY_MVPMOR01_0002, Solvay has introduced a new tool called Xtract (Xtract).

5.8 Availability

Availability is the degree to which the solution is operable and accessible when required. It is a measure of time during which the system is fully operational e.g., available for use and sometimes included as a Service Level Agreement (SLA) considering its criticality to the business, e.g., the system shall be at least 99% available on weekdays between 09:00 to 18:30 Central European Time (CET).

5.9 Refresh of the Data

Closing Time:

Outside of Closing: the reload of data is 1x/ day during in the night