Intercompany Sales in Planning

Question

Hi,
Has anyone implemented planning on Intercompany activity in Planning. I have come up with 2 approaches and see some  cons with both the issues.
I am hoping someone has a better approach than the 2 listed below.
Thanks
-NS
Approach 1 : Each company code plans for its intercompany activity. Trading partner is used as a tag to denote intercompany activity. Move the data to BCS towards the end of planning cylce, execute elimination. BCS will list all the elimination errors.
Problem : This may produce a huge reconciling activity towards the end of the cycle.
Approach 2 : Each company code plans for its intercompany activity. Trading partner as a tag to denote intercompany activity. Planning function creates the reverse entry in the partner company (use a different Planning item to avoid locking problems. This planning item should not be allowed for user entry).
Problem : The reverse entry in the partner company would affect its Finanacial statements

Answer 1

Hello,
I have implemented intercompnay elimination / consolidation several times in BCS and also in BPS.
You have written a short question, which requires a very detailled answer. This is impossible here, so I try to give some comments, hope it helps.
You need to have trading partner e. g. in case that data are delivered by SAP EC-CS or FI. In this case company and trading partner is the standard for intercompany data. Thats normally a very good base for planning as well. Lets say company A and B do have intercopany sales.
The first option is to plan for company A (IC sales) and then to load the same data for company B (IC costs). In this case you dont have any differences between IC sales and costs because: IC costs = IC sales (automatically). But normally company B wants to make their own cost planning and they dont want automatically created costs. Thats possibly the beginn of a very long discussion
But if you plan in company A independant sales and for B independant costs you can have differences (IC costs <> IC sales). This can be an advantage to make wrong planning transparent to all involved companies and will create reconciliation effort.
The target in the end of the day is: IC sales = IC costs, which is the target of "elimination".
you have written: " Each company code plans for its intercompany activity". Yes, thats the normal thing, but for sure in the end of day you will have differences (sales <> costs). I dont see a disadvantage in case that you have huge reconciliation processes: As long as this is reasonable it makes clear why and where unco-ordinated or wrong planning is comming from! If you have to much to reconcile it is an indicator for not coordinated planning processes.
You have written "move data to BCS to eliminate". To eliminate, this can be done at the end when plannung is done for all companies! To realise this elimination technically is quite simple in most cases (not all). So I would say it is to much effort to plan in BPS to eliminate in BCS. In this case BPS can eliminate in BPS as well. But this depend on the elimation rules: If you have to much it could make sence to plan in BPS and eliminate in BCS to avoid double maintnance of elimination rules and especially chart of account and so on. But it can be very complex in case that you have "Intra-sales" AND "inter-sales", so lets say: sales between business divisions and sales between companies. Dont know wether you have to do that? But normally elimination in BCS depend on law but elimination in BPS depend on companies rules, which means: The rules, which are maintained in BCS are normally very strong because of law. But the rules, which can be used for planning are normally quite simple and dont have to much impact from law but from planning responsibility. Thats the reason why I think you dont need to move data to BCS. You sould discuss this possibilities with your business team and ask for a decission.
The fundamental question is to use BPS or BCS? This must be clear before planning. A lot of companies dont use BCS for elimination of planning data, they use BPS for elimination of planning data and BCS to eliminate actuals.
So whenever it is possible I would like to recommend your second approach: "Planning function creates the reverse entry in the partner company (use a different Planning item to avoid locking problems. This planning item should not be allowed for user entry)."
Have a nice day
Eckhard Lewin