Category: S/4HANA Finance

Understanding Product Costing: FG, SFG, and Overheads Simplified

In Valuation variant can there be one costing-sheet for FG and SFG and one for Material components maintained for each plant ? Short answer: ✅ YES — and this is actually a recommended best practiceYou can have: One costing sheet for FG & SFGAnother costing sheet for material components (RM / PM / semi inputs)Assigned … Continue reading Understanding Product Costing: FG, SFG, and Overheads Simplified

UPA and Transfer Price

How does UPA interact with transfer price and impact on COGM and COGS ChatGPT said: Excellent follow-up 👍 — this goes right to the heart of Universal Parallel Accounting (UPA): how it interacts with Transfer Pricing (TP) and how that impacts COGM (Cost of Goods Manufactured) and COGS (Cost of Goods Sold). 🔑 1. Transfer … Continue reading UPA and Transfer Price

How UPA impacts Product-Costing, Group Valuation, Transfer Price?

🔑 1. What is Universal Parallel Accounting (UPA)? UPA harmonizes valuation approaches (legal, group, profit-center) in one Universal Journal (ACDOCA). No separate ledgers (like old profit center ledger 8A) → all valuations live in ACDOCA with different valuation views. Parallel valuations are handled consistently across FI, CO, ML, and Asset Accounting. More Details here : … Continue reading How UPA impacts Product-Costing, Group Valuation, Transfer Price?

Sales Order Costing – Part 3 : config-Checklist

a step-by-step configuration checklist (blueprint) for Sales Order Costing in SAP. This sequence ensures you don’t miss dependencies and can move smoothly from CO setup → SD integration → execution. 🔹 Sales Order Costing Configuration Checklist Step 1: Define Costing Variants (Planned & Actual) T-code: OKKN SPRO Path:Controlling → Product Cost Controlling → Product Cost … Continue reading Sales Order Costing – Part 3 : config-Checklist

Sales Order Costing – Part2 : Configuration

setting up Sales Order Costing in SAP requires both Controlling (CO-PC, CO-PA) and SD integration. Below, I’ll list the SPRO Nodes / T-codes you need to configure so that Sales Order Costing (Product Cost by Sales Order) works smoothly. 🔹 Configuration Steps for Sales Order Costing 1. Activate Product Cost by Sales Order SPRO Path:Controlling … Continue reading Sales Order Costing – Part2 : Configuration

Sales Order Costing – Part1

SAP Sales Order Costing, which is a concept used in Sales Order Management + Controlling (CO) in SAP, primarily relevant when you’re dealing with make-to-order (MTO) or engineer-to-order (ETO) production scenarios. Let me break it down for you: 🔹 What is Sales Order Costing in SAP? Sales Order Costing is a cost management and profitability … Continue reading Sales Order Costing – Part1

Cost-Plus (Manufacturing), Sales-Minus (Commercial) Transfer Pricing Set-up in ECC Vs S/4HANA UPA

Part-1 : What is Universal Parallel Accounting (UPA) Part-2 : ECC (Parallel Valuation) Vs S/4HANA Parallel Valuation with UPA Part-3 : ECC Configuration Part-4 In this Blog, we have a look at a step-by-step IMG configuration flow, which will make it much easier to see where Cost-Plus (Manufacturing) and Sales-Minus (Commercial) Transfer Pricing are set … Continue reading Cost-Plus (Manufacturing), Sales-Minus (Commercial) Transfer Pricing Set-up in ECC Vs S/4HANA UPA

ECC Transfer Pricing Vs S/4HANA UPA Comparison

Part-1 on SAP S/4HANA Universal Parallel Accounting (UPA) In this blog, we look at side-by-side comparison table, with emphasis on how cost-plus (manufacturing markup) and sales-minus (commercial margin) scenarios are configured AreaECC Transfer Pricing (Classical ERP)S/4HANA UPA (2022+)Data ModelSeparate ledgers/tables: • Legal view in FI/CO • Group valuation in Material Ledger (ML) • Profit Center … Continue reading ECC Transfer Pricing Vs S/4HANA UPA Comparison

SAP configuration in Classical ECC Transfer pricing

Let’s go step by step. In Classical ECC (ERP 6.0, before UPA in S/4HANA), Transfer Pricing (parallel valuation) was already available, but the setup was complex and restricted. We essentially had to configure parallel valuations in CO and activate the Material Ledger (ML) to get it fully working. 🔑 1. Core Concept in ECC In … Continue reading SAP configuration in Classical ECC Transfer pricing

Internal Order vs Project WBS- Part5

Statistical Internal Order Vs Statistical Project WBS : Part1, Part2, Part3, Part4 Drawing a parallel between Statistical Internal Orders (IOs) and how the same concept applies in Work Breakdown Structures (WBS elements) in SAP Project System (PS) is the reason for this blog. Here’s the comparison and how to use them: 🔹 Background Statistical Internal … Continue reading Internal Order vs Project WBS- Part5

Licensing and Costs of DAR in SAP S/4HANA Explained

In SAP S/4HANA, DAR stands for Document and Reporting Compliance (Advanced Reporting) — but in the AI/ML & Finance context that we have been discussing (Inventory Provision, Classification), DAR usually refers to “Data Attribute Recommendation”. 🔹 DAR = Data Attribute Recommendation It is an SAP AI Business Service that helps automate and improve master data … Continue reading Licensing and Costs of DAR in SAP S/4HANA Explained

Predictive MRP (pMRP) in SAP S/4HANA for simulating Supply/Demand Scenarios : Useful in Inventory-Provision

Definition Predictive Material Requirements Planning (pMRP) is a simulation tool in SAP S/4HANA (introduced in 1909 release, enhanced in later versions) that helps planners simulate future supply and demand situations without impacting live production data. It’s not a replacement of classic MRP Live (MD01N), but rather a strategic, scenario-based planning tool. 🔑 Key Features Simulation-Based … Continue reading Predictive MRP (pMRP) in SAP S/4HANA for simulating Supply/Demand Scenarios : Useful in Inventory-Provision

Internal Orders Vs Project System WBS – Part4

Concluding the series here's Part 4/4 where we look at (side-by-side) TCODES for Internal-Orders (IO) and Project-System -WBS. For link to previous Parts : Part-1, Part-2, Part-3 When shifting users from Internal Orders (IO) to Project System WBS, it helps a lot to provide a side-by-side mapping of T-codes/Fiori apps. Here’s a comparison table: Internal … Continue reading Internal Orders Vs Project System WBS – Part4

Internal Orders or Project-WBS ? – Part3

Here's link to PART1 https://mps4hana.com/2025/08/21/internal-order-or-project-wbs-part1/  where we looked at SAP NOTE and recommendation regarding usage of Project-WBS and Internal-Orders Link to PART2 : in which we looked at High-level Migration approach for clients using IO in Legacy-ECC and switching to Project-WBS in S/4HANA https://mps4hana.com/2025/08/21/internal-orders-or-project-wbs/ Now in part3 let's explore the practical challenges that needs to be … Continue reading Internal Orders or Project-WBS ? – Part3

Internal Orders or Project-WBS ? – Part2

Here's link to PART1 https://mps4hana.com/2025/08/21/internal-order-or-project-wbs-part1/ And now let's look at High-level plan and activities for a scenario /situation : where we require migration steps from Legacy (SAP ECC) to New system (SAP S/4HANA) in which Client was using Internal Orders in ECC and going-forward Client used Project-WBS, instead of Internal Order. This scenario is common … Continue reading Internal Orders or Project-WBS ? – Part2

Internal Order or Project WBS- Part1

Many Clients Teams who are implementing / migrating to SAP S/4HANA, ask this Key Question : Should we continue using Internal-Order or adopt Light-Project-WBS ? Executive Summary : Type of Internal OrderDescriptionRecommendation / Impact in S/4HANASimple Account AssignmentsUsed as default account assignment (e.g., OKB9) or credit object in costing sheet; also includes statistical IOs.No change … Continue reading Internal Order or Project WBS- Part1

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Universal Parallel Accounting (UPA)

What is Universal Parallel Accounting  Universal Parallel Accounting available for On-Premise and Private Cloud since SAP S/4HANA release 2022 Universal Parallel accounting or UPA is a new finance architecture for handling multiple accounting valuations and currencies in parallel. Not only does UPA introduce various functionalities on its own, but it also serves as the foundation for many … Continue reading Universal Parallel Accounting (UPA)

BSEG And ACDOCA

The Key points to remember BSEG will hold information for OPEN Items ACDOCA usage is for Accounting Principle Controlling Documents - CO Internal Postings Document Splitting For Ledger specific SINGLE SOURCE OF TRUTH : It contains fields such that no recon/separate Sub-ledger required : Asset, Material Ledger, Controlling, Profitability Analysis, GL ACODCA : Single Source … Continue reading BSEG And ACDOCA

Profit-Center Accounting in S/4HANA

2425255 - Profit Center Accounting in the universal journal in SAP S/4HANA, on-premise edition Classical Profit-Center Accounting Vs S/4HANA Profit-Center Accounting You want to know how Profit Center Accounting (PCA) is mapped in the context of SAP S/4HANA and to what extent classic Profit Center Accounting can be used in parallel with SAP S/4HANA. How long … Continue reading Profit-Center Accounting in S/4HANA

S/4HANA Margin Analysis

From SAP S/4HANA 1909 & in S/4HANA Cloud, Profitability Analysis has been enhanced and renamed as "Margin Analysis". S/4HANA 1909 - Margin Analysis (Top-down as well as bottom-up) In S/4HANA Cloud, "Margin Analysis" is mendatory. In S/4HANA On-Premise, it's recommended SAP S/4HANA 1909 The Functionality comparison with S/4HANA 1909 From Costing-Based COPA to ---> S/4HANA … Continue reading S/4HANA Margin Analysis

MACRS : Asset Acquisitions(Mid-Quarter-Convention) S_ALR_87012047

Business -Requirement What does mid quarter mean? The mid-quarter convention treats all property placed in service (or disposed of) during any quarter as placed in service (or disposed of) on the midpoint of that quarter. Mid-Quarter Convention (USA) There are certain tax laws (mid-quarter convention) in the United States that require you to calculate depreciation on the basis of half-periods. … Continue reading MACRS : Asset Acquisitions(Mid-Quarter-Convention) S_ALR_87012047

Mixed-Costing (a)Within-a-PLANT (b) Across-Plant/Comp.Code

SAP mixed costing --> to cost a material using multiple alternative methods, e.g. when you manufacture a material with different internal processes,  then specify these through separate production versions. When we execute a cost estimate the system calculates the cost for each production version then calculates an average unit cost using weighting factors. When we … Continue reading Mixed-Costing (a)Within-a-PLANT (b) Across-Plant/Comp.Code

Product-Costing User-Exit

Develop Enhancements for Material Costing The following SAP enhancements are available for the area Cost Estimate with Quantity Structure: Costing Reports (SAPLXCKA)Costing Production Resources and Tools (COPCP003)Material Valuation with Cross-Company Costing (COPCP001)Costing Bulk Materials (COPCP004)Valuation Price for Materials from User Exit (COPCP005) Let's have a look at User-Exits for Costing-Reports: SAPLXCKA 1. Costing Reports: SAPLXCKA … Continue reading Product-Costing User-Exit

12.1 S4TWL – Reference and Simulation Costing : 2349294

12.1 S4TWL - Reference and Simulation Costing Application Components: CO-PC-PCP-REF System Conversion : Check existing processes for cost estimation : If You are currently using base planning objects (i.e CKHS-BZOBJ ='1' has records) to store cost estimates that can be included in cost estimates for projects, sales orders and so on as items of type … Continue reading 12.1 S4TWL – Reference and Simulation Costing : 2349294

WN : 1809 – Controlling – Production Cost-Analysis Enhancement

For 1709 S/4HANA, during Production-Order Costing, some customers did face the error PLANORD01 and the reason looks like (however this needs to be investigated further), it could be due to the enhancement based on new data-structure and new calculation logic. From SAP S/4 HANA 1809, Production Cost Analysis is enhanced based on a new data … Continue reading WN : 1809 – Controlling – Production Cost-Analysis Enhancement

WN : 1809 – Controlling – CostingRun – Quantity Structure Explosion

In S/4HANA 1809, In costing runs, quantity structure explosion is now part of the Selection step rather than a separate, optional step in the process flow. Explosion can be triggered with the Multilevel Quantity Structure Explosion option in the Selection step. Business Benefit : You use this option if you want to ensure that the … Continue reading WN : 1809 – Controlling – CostingRun – Quantity Structure Explosion

WN : 1809 – Controlling – CostingRun – Recurrence

Starting 1809 OP, Costing-Run can be set-up for a Recurrence Frequency of Once / Monthly / Quarterly / Yearly. CK40N Costing runs now offer a recurrence feature. This makes it possible to execute a costing run on a monthly, quarterly, or yearly basis without having to create the run manually each time. When you create … Continue reading WN : 1809 – Controlling – CostingRun – Recurrence

Planning in S/4HANA & SAC

There are lot of simplifications and improvements in some of the planning activities done in ECC and their equivalent in S/4HANA and SAP Analytics Cloud (SAC) S/4HANA Simplification List The ECC planning functionalities have been deprecated and replaced when S/4HANA was released The classic ERP FI-GL (new) planning is no longer supported in S/4HANA Finance … Continue reading Planning in S/4HANA & SAC

12.5 S4TWL Planning – P&L, ProfitCenter, CostCenter, ORder, Project : ACDOCAP

2270407 : S4TWL - Profit and Loss Planning, profit center planning, cost center planning, order planning, and project planning Reason and Prerequisites : This Simplification Item is relevant if:• Profit Center Planning is used if entries exist in Table GLPCP (check with SE16).• CO-OM Planning is used if entries exist in Table COEJ (check with … Continue reading 12.5 S4TWL Planning – P&L, ProfitCenter, CostCenter, ORder, Project : ACDOCAP

12.3 S4TWL – Technical Changes in Material Ledger with Actual Costing

SAP NOTE# 2354768 - Technical Changes in Material Ledger with Actual Costing With S/4HANA the data model for material ledger data has been changed significantly, especially when actual costing is active. ( Actual-Costing is Active - Technically this can be verified via database table T001W, field MGVUPD. 'X' means that Material Ledger Actual Costing is active … Continue reading 12.3 S4TWL – Technical Changes in Material Ledger with Actual Costing

S/4HANA 1709 : Production-Order Costing : Error

Error : you cost a production/process order (CO02/COR3).You enter the order number.Preform the cost calculation.You receive FINS_ACDOC_PLANNING009; "Category PLANORD01 does not exist" Reason & RESOLUTION Cause There is missing customizing in SPRO. The category PLANORD01 for production order costing is normally predelivered so it is not necessary for customers to create it manually.  Currently we don't know … Continue reading S/4HANA 1709 : Production-Order Costing : Error

Group-Reporting in SAP S/4HANA World

Group reporting supports the computation, creation, and disclosure of consolidated reports that provide information on the performance of a corporate group and consists of topics such as consolidation, reporting and analysis, and plan consolidation. Integration The figure below depicts how group reporting as part of SAP S/4HANA is integrated with SAP Group Reporting Data Collection and SAP Analytics Cloud and is … Continue reading Group-Reporting in SAP S/4HANA World

Realtime Consolidation with S/4HANA – starting 1610

Introduction:SAP has recently released S/4HANA 1610, it has released highly anticipated feature for SAP BPC Embedded i.e. “Real-Time Consolidation”. It is a huge step forward, and it will certainly help to increase the adoption rate of SAP BPC for S/4 HANA.Real-Time Consolidation is part of the S4CORE component. Therefore, no additional installation is required if you … Continue reading Realtime Consolidation with S/4HANA – starting 1610

Business Benefits (Use-Case) of SAP S/4 HANA

  https://blogs.sap.com/2015/10/13/business-benefits-use-case-of-sap-s4-hana/   Benefits of S4 HANA ? While one might be quick in identifying the “technical” differences and principles of SAP S/4 HANA, how do one tackle the question –> Does SAP S/4 HANA offer any tangible and immediate Business Benefits to my business? In this blog, I try to answer this question from … Continue reading Business Benefits (Use-Case) of SAP S/4 HANA

SAP Financial Closing Cockpit in SAP S/4HANA : Status & Roadmap

  Highlights of today;s Enablement Session : SAP Financial Closing Cockpit in SAP S/4HANA: Status and Roadmap   FCC – Financial Closing Cockpit (SAP FCc) is primarily for Entity Close ; SAP BPC is Group Planning and Consolidation   SAP FCc is planned to be part of SAP S/4HANA 1709 (as opposed to being an … Continue reading SAP Financial Closing Cockpit in SAP S/4HANA : Status & Roadmap