project settlement

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megasanju

project settlement

Post by megasanju » Tue Oct 29, 2002 2:17 am

In make to order scenario with projects, what should ideally be the settlement receiver, i am not using Profitability Analysis. The Sales Orders are account assigned to the project and project prohibits me from settling the project to the same sales order. any suggestions would be most welcome.

srinivasdj
Posts: 4
Joined: Thu Oct 24, 2002 12:34 am
Location: Malaysia

Project settlement

Post by srinivasdj » Tue Oct 29, 2002 5:10 am

Hi megasanju,

For Customer projects , usually we settle to Profitability analysis.
Also we can settle to
Asset, ( usually this is for capital investment projects)
cost center ( usually this is for internal projects)
WBS
Cost objects

If you need more information on this you can view the receivers in the settlement profile.


regards
srini
Srinivasan Desingh Manoharan
Singapore

megasanju

project settlement

Post by megasanju » Tue Oct 29, 2002 6:56 am

Since I am not using PSG and the project is a customer poject for make to order scenario, so material and sales order seem to be the most suitable settlement receiver. Sales Order is ruled out since it is account assigned to the project. Can we use the Sales Order as the settlement receiver if we do not account assign the sales order to the project. Why can or can we not use material as the settlement receiver? How about using G/L as the settlement receiver?
any inputs will be greatly appreciated.
megasanju

Guest

Post by Guest » Sun Nov 17, 2002 1:55 am

Hi,

I was also using the same business model where Profitability Segment was not implemented. You can create a dummy WBS and use this for settling your costs too.

If you want to settle to GL you have to define the valuation method first. If you want to calculate WIP as well as revenue surplus then you should define the FI postings accordingly.

Asish

megasanju

Post by megasanju » Tue Nov 19, 2002 1:36 am

Thanks ashish for the reply,
But what will happen to the new WBS where will it be settled ?
Can u elaborate on the valuation method for the GL?
thanks

hotpanfight
Posts: 101
Joined: Wed Dec 04, 2002 2:59 pm
Location: Cleveland

What is WBS?

Post by hotpanfight » Tue Jan 28, 2003 5:06 pm

What is WBS and what is the answer to the above question?

GK
Posts: 49
Joined: Thu Dec 05, 2002 7:52 pm
Location: Australia Downunder
Contact:

Post by GK » Tue Jan 28, 2003 9:13 pm

hi all

the safest option will be to settle the project to G/L account. this will also make sure that data is retained in FI.

sometimes, if the process requires its not a bad idea NOT to settle the project anywhere. but that requires the config settings accordingly.

to settle the project back to Sales Order is a big change in the business process and should be decided in the initial phases of implementation, not after configuration has been completed. As it makes sales order as cost collector.

hope it sheds some light on the subject
cheers

G. Gijsbrechts

Post by G. Gijsbrechts » Wed Jan 29, 2003 11:00 am

You should first consider why in the first place you want to setttle at all.

Of course all the costs and revenues that appear on the project are already in FI. Projects as a CO object merely are a reflection of of the incurred costs in FI.

If you want to allocate certain project costs to the departments that were responsible, it makes sense for example to settle to costs centers representing these departments.

If you want to do some kind of result analysis within the project, you could settle all the incurred costs to the WBS element the revenues are assigned to. This seems more plausible to me then first assigning the Sales Order to a WBS, and next settleing all the costs to the Sales order. This feeling like just moving figures around. Use the WBS element which is billing relevant as the central object for revenues and costs.

If during the lifetime of the project you would see WIP in FI you could simply manually settle amounts to FI. Using reports showing the result as mentioned above.

Just consider why settlement is necessary in the first place. If it doesn't give you any extra info at all, don't even bother. Why should you? It's CO after all.

Just never make it more complicated then necessary.

Good luck,

Gijs

fatman
Posts: 126
Joined: Thu Dec 12, 2002 1:23 am
Location: San Francisco

settlement

Post by fatman » Thu Jan 30, 2003 3:51 am

Very good Posting by Gijs .... :D

Guest

Post by Guest » Thu Jan 30, 2003 7:53 am

Thanks G. Gijsbrechts,

I have implemented it the same way. I am calculating WIP throug RA. But I am not doing internal settlement of costs from the cost WBS to the revenue WBS, since the top level WBS is the billing element. Had the billing WBS been somewwhere down the hierarchy then the costs from the top level WBS should have been settled to the lower level billing WBS element. The Project finally is not settled at all. Correct me if I am wrong.

I am also using deliveries from projects and all the deliveries go with movement type 261/281 because of which I am not able to get COGS of individual dispatches. How can I get the COGS ??

megasanju

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