87161090 BB ECCS GMM Workshop Result

7/29/2019 87161090 BB ECCS GMM Workshop Result

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EC-CS Consolidation forGMM

Workshop Result

Prepared by WAYAugust 2009


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CONTENTS

Requirements

The Solutions Controlling Process Consolidation Process


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REQUIREMENTS

Business Unit Reporting

Overhead cost allocation over business unit

Currently overhead cost is posted to overhead cost center act ascost center pool, assigned under overhead profit center. Inorder to obtain the managerial report per business unit it isrequired to perform the overhead cost allocation.

Profit center report which consider ex-allocation as wellas ex-consolidation

During consolidation process, an additional journal entries iscarried out which will impact consolidation report. For thejournal entries which involve P/L account it is required to beincluded also on the managerial report per profit center andonly impact on the consolidation level.


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REQUIREMENTS

Consolidated Financial Statement

Generate consolidation report inside system

There are three companies need to be consolidated in to onegroup. Currently, the consolidation is carried manually outsidethe system.

Perform consolidation entries at the consolidation level

Consolidation entries such as adjustment, elimination and

reclassification need to be carried out at consolidation levelonly, no impact on company level.

Any adjustment on consolidation level should bereflected on profit center as well

Any posting at consolidation level that involve Profit/Lossaccount should be recorded also at profit center in order to

generate consolidation report per Business Unit. Carry forward Account Balance as well as Retained

Earning

As the consolidation process is completely done, the balance ofthe account including retained earning need to be carry

forward to the following year as the beginning balance ofconsolidation


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THE HIGH LEVEL SOLUTION

CompanyConsolida

tion

ProfitCenter

Consolidation

ConsUnit 1

ConsUnit 2

ConsUnit A

ConsUnit B

ConsUnit C

ConsUnit 3

CostCenterAllocation

ABAP #1 Profit

CenterPosting

ABAP #2

Input Profit

Center intransaction

Adjustment

Elimination Reclassification

Controlling ProcessPeriodi

cRollup

Consolidation

Process

The ABAP program #1 is used to retrieve sales data and post the datato SKF (Statistical Key Figure), this SKF data is used in cost center

allocation The ABAP program #2 is used to retrieve consolidation adjustment

ProfitCenter 1

ProfitCenter 2

ProfitCenter 3

ConsUnit A

ConsUnit B

ConsUnit C

Realtime

Update

Accounting /Logistic Process


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CONTROLING Overhead Cost Allocation :Overview

OverheadCost

Center

CostCenter

BusinessUnit

CostCenter

BusinessUnit

CostCenter

BusinessUnit

OverheadCost

Center

The overhead cost allocation is performed trough costcenter as the cost object and automatically recorded atthe profit center

The allocation is performed trough secondary cost

element in order to keep the original transaction The allocation process must be performed each period

FI Posting

MMPosting . . . .

Sender

Receiver


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CONTROLING Overhead Cost Allocation :Allocation Cycle

5XXXX

6XXXX

XXXX

XXXX---------

XXXX

9XXX1

9XXX2

---------

0

---------XXXX

Primary costelement

Secondary costelement

Expense 1

Expense 2

Expense A

Expense B

Total Actual

Cost

(XXXX)

(XXXX)---------

(XXXX)

9XXX1

9XXX2

Expense A

Expense BXXXX

XXXX---------

XXXX

Secondary costelement

Total Allocated

Cost

Sender Receiver

Total Allocated

Cost

The allocation is performed trough secondary costelement in order to keep the original transaction


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Allocation Cycle Rule:

There are rules regarding the overhead allocation process

1. Cost to be allocated

The cost to be allocated is the total cost incurred in alloverhead cost center

2. Allocation base

The tracing factor is SKF (Statistical Key Figure) to store the

Sales Revenue of the BU profit center as the allocation base.The ABAP program is needed to retrieve and posted this salesdata automatically to SKF, otherwise we have to inputmanually using SAP standard transaction.

3. Sender

The sender is the overhead cost center4. Receiver

The receiver is BU cost center that assigned to BU profit center

5. Allocation Structure

The allocation structure is represent how the allocated cost be

structured. It will use secondary cost element


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Allocation Cycle Rule (continued):

6. Allocation Cycle Name

The allocation cycle is company code dependent, the name willfollow the company code. MBINA will use allocation cyclename GMMXX.

7. Segment Name

The segment represent sequence process in one cycle as part

as the whole cycle. MBINA will breakdown the process of eachsender group as a segment.

MBINA will use segment name GMMXX-XXX


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CONTROLING Overhead Cost Allocation :Allocation Process


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CONTROLING Overhead Cost Allocation :Allocation Process

Description of the tasks:

1. Every end of period, accounting perform closing process. Once

this process is done, the next step is to perform the controllingclosing process.

2. Before run the cost allocation process as part of the controllingclosing, the allocation cycle should be verify first.

3. If needed inform the master data person in charge to update

the allocation cycle.4. Update the SKF (Statistical Key Figure) as the parameter of the

cost allocation.

If the SKF data (in here sales data) will be retrieve and postautomatically,ABAP program will be needed.

5. Execute the allocation cycle. When finished please check thedata both for the sender as well as the receiver cost centerusing standard cost center or profit center report.


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CONSOLIDATION Consolidation process


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Description of the tasks legal consolidation:

The consolidation process takes place after the FI (Accounting) in

each subsidiary completely finish the closing process.1. The first task of the consolidation is balance carry forward

This process will ensure that all consolidated account balancefrom previous year is carried forward to the following year.

2. Data collection

For legal consolidation, the data collection is in real time mode,the data automatically passed to consolidation duringtransaction in each origin module.

3. Data validation

Perform data validation to ensure that all reported data from

all consolidation unit (company) is transferred completely. Wecan set predefine validation by system, for example : TotalAsset = Total Liability.

4. Standardizing financial data

In this step, we create an adjustment / reclassification at theconsolidation unit to ensure the data is correct prior to

elimination process.


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Description of the tasks Legal consolidation (continued):

5. Standardizing financial data validation

To keep the adjustment entered correctly, we have to performvalidation, a predefined validation is set to perform validationby system

6. Inter unit elimination

This step is to eliminate inter unit transactions as the main part

to produce consolidated financial statement7. Reclassification

At group level, we can perform reclassification /adjustment tomove value from one FS item to another FS item

8. Consolidated financial data validation

Similar with the two previous validations, this validation alsocheck the validation transaction data at all level

9. Consolidation reporting

The final step of the legal consolidation is to generate financialreporting which will developed using drill down reporting


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Description of the tasks profit center consolidation:

The profit center consolidation process takes place after the legal

consolidation and controlling process.1. Periodic roll up (Monthly)

This step is to execute periodic roll up to collect data fromprofit center table (CO) to consolidation table (ECCS).

Legal consolidation process

Any adjustment created during consolidation process must beassigned to the proper profit center. This data will be used onprofit center posting

2. Profit center posting

In this step, ABAP program is needed in order to retrieve the

adjustment data and post to profit center at the Controlling(CO) level.

3. Periodic roll up (Year end)

This step is similar to the first step, the different is it executedafter legal consolidation taken place.

4. Data collection

This step is to monitor whether all the profit center data is


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Description of the tasks profit center consolidation(continued):

5. Data validationPerform data validation to ensure that all reported data fromall consolidation unit (profit center) is transferred completely.

6. Consolidation reporting

Similar to legal consolidation, drill down reporting will be use to

generate the consolidation report.


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CONSOLIDATION Global Parameter Legal

Cons groups FS items Data monitor Cons monitor Info system ParametersCons groups FS items Data monitor Cons monitor Info system Parameters

Global parameters

Dimension M1 MBINA Legal Dimension

Cons group MBINA1 MBINA Legal Consolidation

Cons unit __

Version 100 Actual dataYear 2009

Period 12

Cons C/A MBIN MBINA Consolidation CoA

Ledger MB MBINA Consolidation Leger

ParametersParameters

Global Parameters represents the works area, year 2009 period 12means that user is working on the specified period.


CONSOLIDATION Global Parameter Profit


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CONSOLIDATION Global Parameter ProfitCenter

Cons groups FS items Data monitor Cons monitor Info system ParametersCons groups FS items Data monitor Cons monitor Info system Parameters

Global parameters

Dimension M2 MBINA Profit Ctr Dimension

Cons group MBINA2 MBINA Profit Ctr Cons

Cons unit __

Version 100 Actual dataYear 2009

Period 12

Cons C/A MBIN MBINA Consolidation CoA

Ledger MB MBINA Consolidation Leger

ParametersParameters




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CONSOLIDATION Master Data : Global Setting

Dimension represents the type of consolidation

There are two dimension used : M1 (MBINA LegalDimension) and M2 (MBINA Profit Center Dimension)

Group represents the organizational structure in which thecompany/unit need to be consolidated

MBINA use legal consolidation group: MBINA1 (MBINA

Legal Consolidation) and profit center consolidation group:MBIA2 (MBINA Profit Center Consolidation)

Consolidation Chart of Account is required as the point ofview of the consolidated Financial statement. Both Legaland Profit Center Consolidation will use MBIN (MBINAConsolidation COA)

Ledger represents a set of database in certain currencythat will be used in Consolidation Group

MBINA use single ledger in USD for both type ofconsolidations

Dimension represents the type of consolidation

There are two dimension used : M1 (MBINA LegalDimension) and M2 (MBINA Profit Center Dimension)

Group represents the organizational structure in which thecompany/unit need to be consolidated

MBINA use legal consolidation group: MBINA1 (MBINA

Legal Consolidation) and profit center consolidation group:MBIA2 (MBINA Profit Center Consolidation)

Consolidation Chart of Account is required as the point ofview of the consolidated Financial statement. Both Legaland Profit Center Consolidation will use MBIN (MBINAConsolidation COA)

Ledger represents a set of database in certain currencythat will be used in Consolidation Group

MBINA use single ledger in USD for both type ofconsolidations


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CONSOLIDATION Master Data : Hierarchy

Dimension Cons chart of accts Version Period /

Hierarchy

MBINA Legal Consolidation group

Cons Unit B

M1

M1

MBINA1

Cons unit A

M1M1

The entire consolidation structure per consolidation type(dimension) is represented as hierarchy structure

The entire consolidation structure per consolidation type(dimension) is represented as hierarchy structure

Dimention

CONSOLIDATION Master Data : Organization


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CONSOLIDATION Master Data : OrganizationStructure

Consolidation Group

Consolidation Unit

Legal Consolidation

Profit Center Consolidation


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CONSOLIDATION Master Data : Trading Partner

Company Name Consolidatio

n Unit(ECCS)

Company

Code

Trading

Partner

1...

GMM GMM GMM

2...

SEN SEN SEN

3...

SMI SMI SMI Trading Partner is SAP terms representing the unit where itbecomes the key for eliminating inter company transaction.These trading partner is specified in the trading partner set.

The trading partner code is made the same with company code(FI) and consolidation unit (ECCS)

The trading partner is specified in the vendor and customermaster record

Trading Partner is SAP terms representing the unit where itbecomes the key for eliminating inter company transaction.These trading partner is specified in the trading partner set.

The trading partner code is made the same with company code(FI) and consolidation unit (ECCS)

The trading partner is specified in the vendor and customermaster record

CONSOLIDATION Master Data : Financial


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CONSOLIDATION Master Data : FinancialStatement Item

10XXX Cash onHand11XXX Bank12XXX TimeDeposit

20XXX Equipment60XXX Expense

10XX Cash and Cash Equivalent

20XX Equipment

60XX Expense

Consolidation Chart of AccountTransactions Chart of Account

FIFI EC-CSEC-CS

No one to many account mapping is allowed Cost Element need to be mapped as well to Consolidation COA

for the profit center consolidation purpose The detailed FS item and corresponding assignment to G/L

account and cost element will be collected from the user

No one to many account mapping is allowed Cost Element need to be mapped as well to Consolidation COA

for the profit center consolidation purpose The detailed FS item and corresponding assignment to G/L

account and cost element will be collected from the user

Transactions Cost Element

COCO

60XXX Expense

90XXX ExpenseOther

CONSOLIDATION Task Status Monitor :


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CONSOLIDATION Task Status Monitor :Overview

MBINA2 Legal Cons Group

M1 Legal Consolidation

----M1 Legal Consolidation

++++

++++ GMM

SEN

SMI

Balance

Carry Forward

BalanceCarry Forward

Data

Collection

DataCollection

ValidationValidationStandardizing

Entries

StandardizingEntriesHierarchyHierarchy

Tasks

++++

++++

The consolidation process is executed using consolidation taskmonitor in order to have comprehensive consolidation process.

The consolidation process is executed using consolidation taskmonitor in order to have comprehensive consolidation process.


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CONSOLIDATION Data Collection : Methods

Flexible FileFlexible FileUploadUpload

Data

entrylayouts

RollupRollup

ledgerledger

DB

MS AccessMS Access

Non-Non-SAPSAPNon-Non-SAPSAP

EC-CSEC-CSOn Line

Off line

Real Time Update-Single

document

CONSOLIDATION Data Collection : Proposed


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CONSOLIDATION Data Collection : ProposedMethod

Consolidation Type Data

CollectionMethod

Frequency

1. Legal Consolidation Real TimeUpdate

Real time

2. Profit Center Consolidation Periodic Roll up Monthly

Real Time : Every document posted in FI will create be updatedin ECCS on real time basis

Periodic Roll up : Document posted in FI will update ECCS onbatch mode in example : monthly or quarterly at summary level

Real Time : Every document posted in FI will create be updatedin ECCS on real time basis

Periodic Roll up : Document posted in FI will update ECCS onbatch mode in example : monthly or quarterly at summary level

CONSOLIDATION Data Collection Item


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CONSOLIDATION Data Collection ItemSubstitution

For the Legal Consolidation : Item Substitution is a function where thesystem move the net profit in the income statement to the currentyear earning in balance sheet.

AssetsCash and Cash Equivalent xxx

Fixed Asset xxx

Acc.depreciation (xxx)

.

.

.

.

.

AssetsCash and Cash Equivalent xxx

Fixed Asset xxx

Acc.depreciation (xxx)

.

.

.

.

.

LiabilityA/P 3rd Party xxx

Bank Loans xxx

.

.

Share Holders Equity

Common Stock xxx

Additional Paid in Capital xxx

Prior year Retained Earning xxx

Current Retained Earning YYY

LiabilityA/P 3rd Party xxx

Bank Loans xxx

.

.

Share Holders Equity

Common Stock xxx

Additional Paid in Capital xxx

Prior year Retained Earning xxx

Current Retained Earning YYY

COGS xxx

Expense xxx

Depreciation Expense xxx

.

COGS xxx

Expense xxx

Depreciation Expense xxx

.

Revenue xxx

Other Income xxx

Revenue xxx

Other Income xxx

Balance SheetBalance Sheet Profit/LossProfit/Loss

Net IncomeNet Income YYY YYYTotal Assets xxxTotal Assets xxx Total Liability xxxTotal Liability xxx

CONSOLIDATION Standardizing Financial Data


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CONSOLIDATION Standardizing Financial Data(SFD)

Standardizing Financial Data is basically a manual posting

function where the end users post document in order to alignthe accounting standard according to the group policy.

Since the function is manual entry, the function may also beused for any other adjustment posting.

Documents resulted from Standardizing Financial Data areidentified using Document Type and Posting Level.

The detailed transaction of the SFD will be collected from theuser

Standardizing Financial Data is basically a manual posting

function where the end users post document in order to alignthe accounting standard according to the group policy.

Since the function is manual entry, the function may also beused for any other adjustment posting.

Documents resulted from Standardizing Financial Data areidentified using Document Type and Posting Level.

The detailed transaction of the SFD will be collected from theuser

CONSOLIDATION SFD : Document Type and


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CONSOLIDATION SFD : Document Type andPosting Level

Documents

ECMCT

Totalsrecords

ECMCA

Totalsreports

Documentanalysis

Documenttypes

Documenttypes

Numberranges

Numberranges

TasksTasks

Posting

Posting level is for identifying the data as per standardSAP.

Document type is for identifying more specific documentusing the same posting level i.e. the user needs toidentify documents resulted from elimination of AccountPayable and Receivable

CONSOLIDATION SFD : Document Type and


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CONSOLIDATION SFD : Document Type andPosting Level

Process / Task Posting

Level

Documen

t Type

Number

Range

1. Data Collection Blank or 00 Blank N/A

2. Item Substitution 01 DC 100000 109999

3. Validation of RFD N/A N/A N/A4. Standardizing FinancialData

10 ST 200000 209999

5. Validation of RFD N/A N/A N/A

6. Inter unit elimination

(auto)

20 IA - IE 300000

3099997. Inter unit elimination(manual)

20 IM - IQ 310000 319999

8. Reclassification 20 or 30 RC 400000 409999

9. Validation ofConsolidated Financial Data

N/A N/A N/A

CONSOLIDATION Inter Unit Elimination :


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CONSOLIDATION Inter Unit Elimination :Method

Interunit EliminationInterunit Elimination

MethodMethod

FS Item Sets

Pair ofsetsSet 1 Set 2

Items for otherdifferencesDebit Credit

Inter unit elimination works based on pair of FinancialStatement Item containing the trading partner

Differences arise from elimination is posted to items for otherdifference

Elimination journal entries will be posted using posting level 20.

One sided elimination for the sales/cogs elimination entry

Inter unit elimination works based on pair of FinancialStatement Item containing the trading partner

Differences arise from elimination is posted to items for otherdifference

Elimination journal entries will be posted using posting level 20.

One sided elimination for the sales/cogs elimination entry

Further controloptions Difference

strategy

Splitting of

elimination

differences

Two-sided

elimination

One-sided

elimination

Post to initiating

cons unit

CONSOLIDATION Inter Unit Elimination :


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CONSOLIDATION Inter Unit Elimination :Process

Consolidated data before inter unit elimination

PL ValueCU TP

Investment in Subsidiaries 005.000.000.000 SEN GMMA/P Subsidiaries SEN 00 (5.000.000.000) SEN

GMM

A/R Subsidiaries GMM 005.000.000.000 GMM SENCommon Stock 00(4.000.000.000) GMM SENPaid in Capital 00(1.000.000.000) GMM SEN

Consolidated data after inter unit elimination

PL Value

CU TPInvestment in Subsidiaries 005.000.000.000 SEN GMMCommon Stock 00(4.000.000.000) GMM SENPaid in Capital 00(1.000.000.000) GMM SEN

CONSOLIDATION I U i Eli i i R l


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CONSOLIDATION Inter Unit Elimination : Rule

Process / Task FS ItemPair of Set

PostDifference

to

DocumentType

PostingLevel

1. Acc. Payable / Acc.Receivable

1XXXXXX2XXXXXX

1XXXXXX IA 20

2. Rental Expense / Income 6XXXXXX7XXXXXX

1XXXXXX IB 20

3. Management Fee / Expense 6XXXXXX7XXXXXX

1XXXXXX IC 20

4. Sales / COGS 4XXXXXX5XXXXXX

N/A ID 20

The detailed of the inter unit elimination FS Item(account) will be collected from the user

CONSOLIDATION R l ifi ti


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CONSOLIDATION Reclassification

Reclassification function move the value of certain FSI(Financial Statement Item) into another FSI. This onlyapplicable if the reported financial data is consistentacross the group

The reclassification functions may mean netting offbetween 2 reported items.

Common netting off of reclassification:

Netting of Prepaid VAT and VAT Payable Netting of Interest expense and Interest income

The document type and posting level setting of thisfunction please refer to the document type section

The detailed reclassification transactions will be collectedfrom the user

CONSOLIDATION V lid ti


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CONSOLIDATION Validation

Process / Task PostingLevel

1. Data Collection Blank or 00

2. Item Substitution 01

3. Validation of RFD N/A

4. Standardizing FinancialData

10

5. Validation of RFD N/A

6. Inter unit elimination(auto)

20

7. Inter unit elimination(manual)

20

8. Reclassification 20 or 30

9. Validation ofConsolidated Financial Data

N/A

10. Balance Carry Forward N/A

At this postinglevel

At this posting

level

At this posting

level

CONSOLIDATION V lid ti


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CONSOLIDATION Validation

Validation of RFD: this validation function is used to validate the

Reported Financial Data based on the predefined rules.1. Check if Assets Equal to Liabilities + Stock holder equity2. Check if Current Year Retained Earning is equal to current

net Profit

Validation of SFD: this validation function is used to validate the

Standardized Financial Data based on the predefined rules.1. Check if Debit = Credit

The validation of Consolidated Financial Data: this is similar tovalidation of Reported Financial Data and standardized financialdata, only technically include all posting level.

Validation of RFD: this validation function is used to validate theReported Financial Data based on the predefined rules.

1. Check if Assets Equal to Liabilities + Stock holder equity2. Check if Current Year Retained Earning is equal to current

net Profit

Validation of SFD: this validation function is used to validate the

Standardized Financial Data based on the predefined rules.1. Check if Debit = Credit

The validation of Consolidated Financial Data: this is similar tovalidation of Reported Financial Data and standardized financialdata, only technically include all posting level.

CONSOLIDATION B l C F d


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CONSOLIDATION Balance Carry Forward

Balance sheetAssets 10,000...Liabilities 10,000

Income statementANI 1,000

Balance sheetAssets 10,000...Liabilities 10,000

Income statementBalance carriedforward 1,000

n+1

Closing balanceOld fiscal year

Opening balanceNew fiscal year

CONSOLIDATION I f ti S t


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CONSOLIDATION : Information System

R/3R/3

ConsolidationConsolidation

Report PainterReport Writer Journal entry

reportsReports

master data control data

financial data

Predefined/Standard ReportsPredefined/Standard ReportsCustom ReportCustom Report



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In addition to the standard consolidation report, a custom reportwill be developed using report painter / writer.

Customized report will be collected from the user and afterinvestigate to the standard report in case the reports alreadyprovided by the standard.

Existing customized report:

1. Consolidated profit / loss by Business Unit (Profit Center)

In addition to the standard consolidation report, a custom reportwill be developed using report painter / writer.

Customized report will be collected from the user and afterinvestigate to the standard report in case the reports alreadyprovided by the standard.

Existing customized report:

1. Consolidated profit / loss by Business Unit (Profit Center)

CONSOLIDATION : Legacy Data Scenario


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CONSOLIDATION : Legacy Data Scenario

Jan Nov09

As of Dec08

Openingbalance

upload

Subsequentposting oftransaction/Rollup

Real time(online) /Rollup

Start from 01 Dec09

Real time is used for companyconsolidation

Roll up is used for profit center

consolidation

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