FIN2008 Prakhina Leverage Budget Management

8/9/2019 FIN2008 Prakhina Leverage Budget Management

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2008 Wellesley Information Services. All rights reserved.

Leverage BudgetManagement Functionality

in SAP to AdministerBudgets for Projects,Internal Orders,and Cost Centers

Michael PrakhinaLazar Consultants


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In This Session

This session examines strategies for configuring and

deploying SAP applications to support BudgetManagement scenarios

Review functionality available across the SAP landscape

to manage budgets and receive best practices for

streamlining the budgeting processes for projects,

internal orders, and cost centers

Get a handle on budgeting for more than one currency

Examine the prerequisites for budget allocation and walkthrough configuration of Budget Management

functionality for projects and internal orders

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In This Session (cont.)

Learn how to compare actual postings versus budgets

using cost center budget planning functionality Understand the impact that purchase order and invoices

have on budget through Commitments Management

Get unique tips for displaying budget line items, andlearn how to run budget update reports

Get tips for approving and releasing the budget on the

Internet

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What Wel l Cover ...

Overview of Budget Management in SAP ERP 6.0

Availabil ity Control

Commitments Management (CO)

Budget Management for Cost Centers

Budget Management for Internal Orders Budget Management for Projects

Web-Enabled Budgeting in SAP ERP 6.0

Wrap-up


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What Is Budgeting?

Budget is the device by which management approves

the expected development of order costs over a giventimeframe

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Planning vs. Budgeting

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You administrate the approved cost framework for anorder or an order group using Budget Management

You can enter the order budget manually or copy budget

information from any plan version

The budget is the

approved coststructure for anorder or a project


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Budget Types

Original budget

This is the budget originally assigned, before any updates weremade.

Budget updates Unforeseen events, additional requirements, for example, price

rises for external activi ties, and so on. This may mean you needto update the original budget, in the form of:

Supplements

Returns

Current budget This is derived from the budget types

already mentioned:

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How Budgeting Works

To create a budget for an order, you must define a budget prof ile and assign it

to the order type

The budget profile defines the parameters for budgeting

In Customizing, you must define a number range for your budget documents

When you save the budget, the system checks that the sum of the annual

values matches the overall value for the order

Order: 400010

Budget Line ItemsOrder 400010 Chicago Trade Fair

Document Year Activity Amount ...

Total 2000 19,000

Original CurrentBudget Budget

Overall 40,000 50,000

2000 15,000 19,0002001 15,000 18,0002002 2,000 3,0002003 3,000 4,000

030000001 2000 Original 15,000

030000200 2000Supplement 5,000

030000306 2000Return 1,000-

You can: Update and make changes

to the budget

Freeze the budget using

status management

Display the budget line

items from the budgetscreen

Enter text for budget line

items to provide supporting

information for the budget

transaction


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Define Budget Profile

To create a budget for an order, you must define a

budget profi le and assign it to the order type

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The budgetprofile definesthe parametersfor budgeting

Is AvailabilityControl activatedmanually orautomaticallyduring budgeting?


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Things to Remember

The budget represents the funds approved by the

management. The budget types include the originalbudget, budget updates, and the current budget.

Line items are recorded for updates to the order budget.

To create a budget, you must define a budget profile andassign it to the order type or the project definit ion.

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What Wel l Cover







Wrap-up


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What Is Availabil ity Control?

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As an order or project is executed, business events are recorded that call uponavailable funds

These events result in the posting of actual costs and commitments to the order

or project

Commitments represent obligations that lead to actual costs through subsequent

business events; e.g., a purchase order may result in a CO commitment

Is availability control

active?

For which transactionswill availability controlapply?

What are the tolerancelimits?


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How Budgeting Works with Availability Control

Use tolerances to

define how the

system should

respond to a given

degree of budget

overrun

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Budget Carry Forward

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You can transfer unusedfunds to the next fiscal yearusing the budget carry

forward function SAP carries forward the

difference between thebudget and actual amountsfor the year specified


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Budgeting in Different Currencies

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You can choosedifferent currenciesto enter your budget

All budget items are

converted and savedautomatically in thecontrolling areacurrency and theobject currency


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Things to Remember

Unused budget amounts can be carried forward to the

next fiscal year. ERP system can perform active availabil ity checks when

the order is debited. The ERP system checks whether

the order budget is adequate for the actual posting or

commitment.

In Customizing, you specify the system response if

tolerance levels were exceeded.

Budget can be entered in the controlling area currency,object currency, or a user-defined currency.

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What Wel l Cover







Wrap-up


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About Commitments Management

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By recording commitments as well as actual costs, you can

compare the funds you have allocated to your budgeted cost to

determine funds availability


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Commitments Carry Forward

You can carry forward open commitment values into the

first period of the next fiscal year as part of year-endclosing

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Types of Commitments Management

There are three types of commitments, depending on

the account assignment object: Order commitment

The commitment is initially assigned to an order

Cost center commitment

The commitment is initially assigned to a cost center

Project commitment

The commitment is ini tially assigned to a project or to a

work breakdown structure element

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Activate Commitments Management

You activate Commitments Management:

For each controlling area from a chosen fiscal year For orders per order type

For cost centers

For cost centers per cost center type

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Tip


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Commitments Reports

In addit ion to the actual values and budget values, this

report displays commitment values

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Things to Remember

Commitments are specific goods ordered for an internal

order, a cost center, or a project A purchase order commitment is created that is

equivalent to the purchase order value

Commitments are reduced by business transactions(such as goods receipts) and actual costs are incurred

by the corresponding account assignment object

At year-end closing, you can carry open commitment

values

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What Wel l Cover


Availabil ity Control Commitments Management (CO)




Wrap-up


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Define a Budget Profile for Cost Centers

You create a budget profile to specify technical and

administration values for budgeting by cost center

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Maintain Cost Center Budget Information

Entering cost center budget is simple! You can enter i t

manually, copy/paste, or just simply upload from

spreadsheets 25

You canmanually enter

budget for costcenters

Use Excel toupload valuesautomatically


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Cost Center Budget Planning in Excel Type Report

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Cost Center Budget and Commitments Reports

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Via the Report/ReportInterface you canbranch to the CostCenters: Actual LineItems report


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Budget Upload Using Excel

To be able to upload the files, you must specify the characteristic

values in the lead column of the corresponding planning layout. It

is not enough to simply specify the characteristic text.28

You can uploadbudget values from

Excel

You can copy actualcosts or otherplanning profiles toyour budget


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Things to Remember

The simplest way to define budget information is to enter

amounts into the Cost Center Budget Planning screenfor each cost center

All reports in SAP ERP 6.0 are embedded into Excel

You can upload budget information by using regular flat

files from your PC

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What Wel l Cover






Wrap-up


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Assign Budget Profi le to Internal Order

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You assign BudgetProfile to Internal OrderType.

You can allocate budgetafter the Createdstatusis reached. If you want

to prohibit budgetallocation in the Createdstatus, you need todefine a user status.


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Change Budget for Internal Order

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You can manually enter a budget per internal order orper order group

Internal order commitments will reserve funds

You can use Excelto upload values

automatically


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Internal Orders Commitments Reports

This report enables the internal orders manager tocompare budgeted and allotted costs on internal orders.

It also includes postings on statistical internal orders.

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Things to Remember

In order to budget by internal order you have to assign a

budget profi le to an internal order type You can manually enter budget information or upload

using Excel

All predefined SAP reports display budget, actual, and

commitments values

In order to report in a number of different currencies,

you have to develop new reports or change existing

reports

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What Wel l Cover






Wrap-up

f f


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Enter Budget Information for Projects

You can enter or use Excel upload to import budget

amounts per project or for WBS elements

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A i B d ti P fi l t th P j t D fi iti


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You should not maintainbudget profile if you

use Budget ControlSystem (BCS)

Assign Budgeting Profi le to the Project Definition

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Tip

You store a budgetprofile or order type inthe project definition

The period of timeduring which budgetingis allowed

Whether budgeting is

allowed for total annualvalues, and/or annualvalues

R l i th B d t


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Releasing the Budget

You can release budget on a total or an annual level

The release is based on the current budget, meaning theoriginal budget changed by supplements, returns, or

transfers 38

Release

B d t F i C R l l ti f P j t


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Budget Foreign Currency Recalculation for Projects

Regardless of which currency you use for budgeting,

the system always translates the entered planning andbudget line items into the controlling area currency

and object currency and updates the values in both

currencies39Tip

C i t Ch k


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Consistency Check

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Consistency check of

plan/budget Transfer of p lan to

budget

Mass release of

budget for projects

Currencyrecalculation for

plan/budget

The consistency checks you activated are run in the

background when you post or pre-post a budget amount

B d t C F d f P j t


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Budget Carry Forward for Projects

You cannot carry

forward a negative

budget into thefollowing year

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P j t B d t d C it t R t


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Project Budget and Commitments Reports

Using the navigation menu, you can break down a report by a number of

features, such as business transactions

You can report overall budget as well as budget commitments information

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Drilldown

Thi t R b


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Things to Remember

The budget is carried forward on the basis of the values

in the currency defined in the budget profile To budget a project, you can transfer the values from

cost planning as a budget; you can also enter the

budgets directly in the WBS elements

You can release a budget on a total or an annual level

(providing budgeting using total or annual values is

included in the budget profile)

You can display totals records for supplements, returns,and transfers for projects

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What Wel l Co er


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What Wel l Cover






Wrap-up

Web Enabled Budget Requests


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Web-Enabled Budget Requests

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Request for

Budget Request(scenario SR61)

Budget Requestwith Approval

(scenario SR62)

In SAP ERP 6.0 theremultiple predefinedWeb-Enabled forms

such as this one.Components Internet/

Intranet ServicesInternal Service Request Scenario Definition

Define Scenarios

Internal Tasks


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Internal Tasks

You can define a follow-up action for an Internal Task that wil l

automatically be triggered and executed by the system A follow-up action can call one or more function modules that

execute specific funct ions (for example, printing or calling up a

transaction)

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Document Flow


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Document Flow

The document flow allows you to identify:

Preceding documents Documents from which the current notification originated

Subsequent documents

Documents that originated from the current notification

To-and-from references between documents Document number

Addit ional data (if available)

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Things to Remember


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Things to Remember

You can define Web-enabled scenarios for recurrent

internal service requests Budget scenarios SR61 and SR62 are predefined and

can be used as templates

You can assign workflow tasks and display document

flow to list corresponding documents assigned to a

budget request

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What Wel l Cover


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What We ll Cover






Wrap-up

Useful Reports


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Useful Reports

Calling up Cost Element Reports for Order Commitments Choose Accounting Controlling Internal orders Information system

Reports for internal orders Plan/Actual comparisons Additional keyfigures Order: Actual/Plan/Commitments.

Reports for Cost Center Commitments Choose Accounting Controlling Cost Center Accounting

Information system Reports for Cost Center Accounting Plan/Actual

comparisons Additional key figures Cost centers: Actual/Plan/Commitments.

Calling up Cost Element Reports for Project Commitments Choose Accounting Project System Information System

Controlling Costs Plan-based Hierarchical Plan/Actual/

Commitments/Rem. Plan/Assigned. To display totals records for supplements, returns and transfers

Choose Logistics or Account ing Project System Information System Controlling Costs Budget related Budget updates

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Budgeting Transactions


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Budgeting Transactions

KPZ2 Cost Center Budgets Change

KO22 Internal Order Budget Change

CJ30 Project Budget Change CJCO Project Budget Carry Forward

CJCF Project Carry Forward Commitment

CJCO Project Budget Carry Forward

IMCCP3 Transfer Plan to Project Budget

IMCOC3 Plan/Budget Consistency Check for Projects

KO30 Activate Availability Control

KOCO Internal Order Budget Carry Forward

KOCF Internal Order Commitment Carry Forward

IMCCP4 Transfer Plan to Order Budget KSCF Cost Center Commitment Carry Forward

KP06 Change Cost Center Budget Cost, Activity Inputs, and Cost Elements

IMCOC4 Plan/Budget Consistency Check for Orders

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Budgeting Menu Paths


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Budgeting Menu Paths

To define Budget Profile for Cost Centers in

Customizing, choose: Controlling Budget Management Budget Management

Define Budget Planning Profi les

To define Budget Profile for Internal Orders inCustomizing, choose: Controlling Internal Orders Budgeting and Availability

Control Maintain Budget Profile

To define Budget Profile for Projects in Customizing,choose: Project System Costs Budget Maintain Budget

Profiles

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Budgeting Menu Paths (cont )


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Budgeting Menu Paths (cont.)

Another ways to assign a budget profile to a project:

As a default in Customizing under Project System Costs Budget Maintain Budget Profile

In the profi le data of a standard project definition under

Accounting Project System Project Special

Maintenance Functions Project Structure Planning Project Definition Create Control tab page Group box

Accounting Budget Profile

In the profi le data of a project definition in Customizing under

Project System Structures Operative Structures

Project Structure Plan Create Project Profile

Resources


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Resources

SAP Service Marketplace*

Cost Center and Internal Order Accounting http://service.sap.com/~form/sapnet?_SHORTKEY=01200252

310000079805&

SAP Help Portal

http://help.sap.com/erp2005_ehp_03/helpdata/EN/a9/ab7f68414111d182b10000e829fbfe/frameset.htm

SAP Developers Network

www.sdn.sap.com/irj/sdn/bpx-forums

* Requires login credentials to the SAP Service Marketplace

7 Key Points to Take Home


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7 Key Points to Take Home

You can budget by cost center, internal order, and

project The main configuration feature is to create and assign a

budget profile

All reports are Excel-enabled

You can upload budget information into SAP from Excel You can display, enter, and request budget information

over the internet/intranet

You can monitor your budget spending with

Commitments Management

Availabil ity Control feature prevents you from spendingunapproved funds

Your Turn!


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Your Turn!

How to contact me:

Michael Prakhina

[email protected]