Responsibility area: Perform product costing monthly closing-ML
Table of contents
Scope
ERP
PF2
Frequency
References
CKMLCP - Cockpit Actual Costing
Forms
Attachments
Corrections on D43 for Sp.Pol companies
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1. Objective and Scope
1.1. Objective of this Operation
The objective of this operation is to guarantee that all costs posted in Cost Centers are allocated correctly to the final PL of the respective company.
1.2. Scope
This procedure is applied to all companies WW.
2. Definitions
3. Tasks description
3.1. I verify that the previous dependent steps have been performed
Confirm that Product Costing is successfully completed.
3.2. I launch the calculation of Inventory valuation
All the finished and semi-finished goods are preliminary valuated at standard costs during the month. Consequently, at the end of the period, it is necessary to run Material Ledger, in order to correct the standard price, calculating an actual price for each material, based on all the actual costs for that specific period. This actual price is called “periodic price unit” and can be used to revaluate the material stock for the mentioned period.
Actual Costing - determines what portion of the variance is to be debited to the next highest level using material consumption. With the actual BOM, variances can be rolled-up over multiple production levels all the way to the finished products.
Material Ledger is activated at company level but its use can be limited by plant or by article. So, if one plant is customized with ML, all the articles in this plant will have material ledger postings but with a different importance depending if the article is included in the end of the month procedure or not.
After the run of Material Ledger, all the inventory stocks are revaluated at actual prices and actual production cost of the period.
The transaction is composed of 5 flow steps which have to be launched in a sequential way and ends with the post closing step.
For WP2 companies, Material Ledger is performed only for Brazil and South Korea, due to fiscal purposes and for that reason the postings are done in local accounts.
In case of FI accounts closed please bear in mind that information in MM might be impacted (CKM3 information). In case this occurred please refresh cockpit to have the most updated status for the materials.
As action, open FI period, re-run post closing step and refresh cockpit again.
If accounts are not opened and material ledger is not refreshed, re-run ML cockpit will be kept in error, originating problems in the following period.
3.3. I check that there are no errors in Material ledger
Check the log of each step processed in CKMLCP to see if there are errors, even with all the status green.
Besides the errors that can appear in the log of each step, above you can find some of the possible errors that we can find during the run of Material Ledger:
Single Level Price Determination
"You cannot perform price determination in period XXX/YYYY"
This error happens because we are creating a Costing Run for future periods and, so, we have to correct the period.
Or else, if we are in the actual period, it means that the Material Ledger wasn’t performed for the previous period and, in that case, we have to check the reason for that and, if necessary, contact locals.
In this case, there is an inconsistency in the master data of material 32690 (Plant RBAE). This material is marked with “Price Determination: 3 Single-/multi-level” and “Price Control: S Standard price” (transaction MM03 – Accounting 1). This means that this material has to be integrated on the Material Ledger for the current month. However, as it wasn’t included on the previous one, it’s generating an error.
In these cases, we have to check with SU MAC Team if the mentioned material should be included or not on ML for the closing month.
After, we have to re-start the ML for the closing month.
Multilevel Price Determination
"Periodic Unit Price of the material will be negative"
Differences were collected in the period to be settled and, after the recalculation, a statistical periodic unit price has been calculated with a negative price.
To correct this, we must check if all production orders are settled, and settle the ones that still remain with amount. After having all the production order settled, if we remain with the same error, we need to exclude the mentioned material from the multi-level parameters:
"The actual price for XXXX could not be determinated"
To solve we need to go to transaction KBK6 and manually change the actual price for the cost center and activity type in error:
In order to not have a variance, we just copy the amount that we have in column VarPlanPriceAreaand paste it to column FxdActPriceArea.
After we must repeat this step (Multilevel price determination) for ML.
Post Closing
"Material XXXXX in valuation area YYYY locked"
Someone is using the material at the same time that we are running Material Ledger. We have to wait until that person leaves the material and re-run this step for the ML.
Remark: This error can also happen on other steps of Material Ledger.
The period is not open.
Go to transaction OB52, open the necessary account type and G/L account and re-run the step.
"Account determination for entry COCA LKW not possible"
When choosing the parameters selection, the option "Revaluate Material" was not flagged, causing this debit credit inconsistency.
In order to correct this error we have to reverse ML and re-execute the last step flagging the correct fields.
"Maximum number of items in FI reached"
The maximum number of items for a FI document has been exceeded.
To correct this error we have to change the field “No. of Materials in ML Doc.” from 50 to 1:
3.4. I check the balance of cost center *843*
With the implementation of SPS it was created 1 technical CC *843*, which will receive amounts during all month (at each movement done in the material), registered with the price of the respective material.
At the end of the month, with ML and Integrated Margin, the material price is updated and this is also posted in the same CC *843*.
This means that this CC will collect all the price differences of each material, and that it should be balanced after running the ML and IM, and should remain only with a small amount, that will then be allocated to value field D43 with a cycle.
In order to check the balance, it's important to understand that, in the subcontracting flows, the goods issue and goods receipt will also generate posting into this CC. However, they are not considered a ML variance, so the relevant cost elements should be excluded by the way of filtering in report layout.
There is a specific layout already created in KSB1 (/SPS VAR) that can be used.
Also it's recommended to set the "Maximum No. of Hits" from 5000 (which is the one by default) to 999999999:
In case this CC is not balanced (or with a threshold amount agreed with the controllers), it must be analyzed.
There are several reasons for the unbalanced amount, and for some of them it might be necessary to re-run ML.
We can find here the details of how to make this analysis.
Besides the tips mentioned in the presentation above, we can also try to check also the movements of the material in transaction MB51 and see if we find something outside of the ordinary (can be compared with other material) - eg. movement types not used in the past, …
Exception for Sp.Pol companies:
The amount unbalanced in CC *843, after the analysis and in case it's supposed to be allocated to PL, must be allocated to the respective materials.
The instructions can be found here (please note that there 2 to sheets with instructions, depending on the companies)
3.5. I inform the person in charge of product costing that Material ledger is completed
After checking that Material Ledger is finished and CC *843* is OK, an information message should be sent to controllers.
Costing Run Deletion
STEP 1
This transaction can only be executed if the Costing Run wasn’t processed yet. Otherwise, the message “No authorization to delete the log” will be retrieved.
So, if the Costing Run wasn’t processed yet, and when the naming of the Costing Run was not correctly chosen or when the plant selection was mistaken, we can delete it.
Insert the posting period, the fiscal year and the name of the costing run that you want to delete. After, press .
STEP 2
The system issues a warning about the consequences of this deletion.
- Click
The costing run is deleted and the system indicates from which table was the data deleted from.
Reverse Material Ledger
The reverse of the Material Ledger is performed just on the last step, the Post Closing.
In this case:
- Mark the processing type "Reverse"
- Mark the parameter "Revaluate" (for WP2, this is not necessary)
- Delete flag "Background processing"
- Delete flag "Test run"
- Mark "Save log"
- Execute the step Post Closing
- Refresh Data with Direct Processing
Material status check
STEP 1
Enter the transaction Z1K_MLSTATUS.
In the field Valuation Area, add the plants considered in the costing run.
Check on CKMLCP the plants used for a specific costing run and copy them into Z1K_MLSTATUS.
STEP 2
In the report result, status 70 is "Closing entry performed", so it's OK.
STEP 3
In the bottom of the screen you will find the description of each status.
If code 05 appears it means that the article was not touched in any transaction
If code 60 appears it means that ML was reversed but missing the relaunch.
When executed the report Z1K_MLSTATUS after Material Ledger, the expected status should be 01, 05 and 70.
ML Posting check
The documents posted by Material Ledger are always two: one with document type WE and another one with ML.
These are only posted in FI, MM and CO-PCA, and they correct the cost of goods sold (COGS) against stock accounts.
1. Transaction CKMB
In transaction CKMB, enter the document number and the running year and you will be able to see the Material Ledger posting by material
2. Transaction CKMS
In case of not having acessed immediatly CKMB after step 5 of ML cockpit run (otherwise you will not have the document number), in order to assure the entry of ML Post Closing enter in CKMB, please select the match code
You will enter in CKMS transaction. Select the plants codification included in CKMLCP – Assigned Plants.
Note: It's normal that he transaction takes some time to run.
Create a filter by the document number codification 2000*:
We will be able to access the Post Closing documents.
3. Transaction CKMLCP
Staying in the costing run, there's also the possibility to look to the closing results.
Click on the Costing Results option and you will have an overview:
Select a plant on the top node (corresponds to the company with all assigned plants, treated in the costing run)
Double click on the selected object and an additional frame appears
On the right side, open the selection button 
, click on Choose Layout and select a layout (e.g. /TADFSTOCK)
The right side will change and show the costing results by material and the total by plant or by other chosen level
4. Transaction CKM3 - material price analysis for one material
Enter the material number, plant, valuation type ( blank, produced, purchased) and analysis period
Choose view ( usual ‘ price determination structure’ )
Click on refresh
See below the stock development for the selected material in the chosen period
In the bottom line see the period-end inventory revaluated in the material ledger at actual cost (column: ActualVal), the new periodic unit price, the preliminary value (stock quantity * standard price in column: PrelimVal) and the single and/or multi-level price differences, which are finally posted and lead to adjustments in inventories at the end of the period.
