Material ledger Clarification.

Hi Gurus,
I need clarification regardign material ledger.
We activated material ledger.
In the Month of Dec we did the intital stock upload for FG and SFG items. In the month of Jan 2012 we did the costing and those are stocks the system generates the revalaution based on the new price + or -. In the month of Jan i did Ml closing for the month of Dec 2011, the system posting the accountign documetn to Price differe to Revaluation account in the month of Jan 2012.
Now all revalaution values is transferred to Price Difference account.
Kindly adivise this process is correct.
Thanks.
S.Siva

Hi,
Depending on the post closing options the post closing may use the business transaction
BSX or LKW in CKMLCP:
Revaluation of Ending Inventory (flag 'Revaluate material'set):
     Price/exchange rate differences are posted to Inventory Account
     BSX. Price control is changed from 'S' to 'V' because inventory
     is now valuated at actual price.
    PRY   PRV   KDM   KDV   ->    BSX
No revaluation of Ending Inventory (flag 'Revaluate material not
     set): Price/exchange rate differences are posted to stastistical
     account LKW. Price control is not changed, because inventory
     remains valuated at standard price.
    PRY   PRV   KDM   KDV   ->    LKW
Please take a look at the note 908737 which explainsthe post closing in detail.
I hope it helps.
BR,
MLM

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Parallel currency in company code require material ledger activation

Hello,
I have a requirement where the company is using parallel currency in NEWGL concept with two different currencies INR and USD.
I want to have a clarification whether I Need to activate Material ledger with parallel currency.
1. Company is using parallel currency with only one legal valuation view.
2. There is no requirement for product costing in the company.
Can the balance in general ledger can be seen in both currency for inventory balances.
Awaiting for your inputs
Thanks

If you don't need parallel currency at present, there's no need to configure it. Why should that be a problem, as long as your Business needs are not relevant to using a parallel currency?
I suspect your actual query is details regarding the future problems that you might face when, faced by changed Business scenarios, you are forced to introduce parallel currency at a future date
If my suspicion is correct, I suggest you look at SAP Note 39919. It's an old note - but one that I've found contains quite relevant tips and tricks about introducing parallel currency in a productive environment.
Remember to assign points if found useful.
Regards,
Gulshan

Material Ledger Postings - Contradicting IAS 2?

Hi All,
Material Ledger captures both Price Differences and Exchange Rate Differences and allocates these according to Stock and Consumption.
During the month, when we encounter Price and Exchange Rate differences, these are held on the P/L. At month-end, when we close ML, the Price and Exchange Rate differences 'attribuatable' to Stock are moved from the P/L to the Balance Sheet (or "Capitalised").
This is seemingly contrary to IAS 2, which clarifies that Exchange Rate differences cannot be capitalised on stock. Is that an acceptable accouting treatment for (say) external reporting. Certainly SAP does follow IAS, so I'm probably just missing the point?
Reproduced Verbatim:
"Inventory cost should not include: abnormal waste, administrative overheads unrelated to production, selling costs, foreign exchange differences arising directly on the recent acquisition of inventories invoiced in a foreign currency and interest cost when inventories are purchased with deferred settlement terms."
Can anyone shed light please?
Regards.
Venky.

Dear Ram
Thanks for your reply.
Both the production orders are for the same material, same BOM was used and the only difference is the goods receipt was not made for one productin order. We need to hold that order for 2 weeks. Fortunately this happens in the month end and the BOM is very small by which we could able to find this difference.
In CKM3 w.r.t actual cost copmponent split the value of one number is 4500 instead of 4800. The total consumption difference for the two orders are shown as the price difference and the price is calculated for 1 EA of the finished material in stock.
My requirement is since we have given to stock only one number the consumption difference has to be posted to 1 EA. and the consumption difference for another one should be loaded to pending production order.
or is there any way to post the price difference to pending production orders.
Thanks
Soundar

Material Ledger Closing

Dear Gurus,
While material ledger closing using CMKLCP,i need clarification for the following process.
1. Single/level
2. Multilevel.
3. Revaluation of Consumption
4. WIP Calculation
5.Post closing
6. Price update.
can anyone explain about the above process outcome, what is the difference between material ledger WIP Calculation and Production order WIP Calculation.
While price update for price control material S, we need to re run cost estimate or it will update the new prices.
Appriciated for valuable inputs.
Ramesh.

Hi Ramesh .
Hope you understand clearly the purpose of standard costing and why we use Material Ledger .
Standard Costing is based on a pre-determined /derived prices for a period/year and all costs are caputed on the basis of the standard Cost . Goods Issues/Receipt , consumption all are at standard cost.
COGS GL Account is at standard and all the inventories are at standard ..
Difference between standard and actual costs are captured as variances in different GL Account . Mainly we have two variances... price variances ( at the time of purchases ) and usage variances at the time of production ..
Material Ledger is a seperate module.. where it calculates the actual costs . Variances are rolled back to the consumption accounts ( which is at standard ) to derive the actual cost . Actual Cost = Standard Cost + Variances .
1. Now Finished Material is made of Raw Material and Semi-Finished Goods . ...When we calculate the actual costs of finished product .. we can find out the actual costs of raw materials and semi-finished goods. ML will find out the actual cost of raw material , semi-finished goods and finished goods. This concept is know as multi-level determination ... In Single level.. only one level of material cost is computed as actual.. not rolled back to the lowest level.
2. Revaluation of consumption during ML run means .. the COGS ( which was at standard earlier) is now being revaluted and becomes actual..
3. WIP Calculation calculates the WIP costs on actual.
4. Post Closing Step will put the new GL entries.. where variances will be nullified and COGS and inventory will become actual.
5. Price Update is optional.. you can make the actual costs computed as standard cost for the next month..
Production Order WIp Calculation = Actual Qty X Standard Rate
ML WIP Calculation = Actual Qty x Actual Rate
Please revert back for any further clarifications
Regards
Sarada

Blogs for Material Ledger

Hi
I have a situation where Material are using 2V and the material inventory left with some price difference .
For example we have issued PO for 10 pieces as Project Stock @ 10 $ each , At the time of MIRO we have a price diff of 0.50$ each piece .
Before MIRO we have issued the stock to Project . In one of the material the price diff of 0.50$ was absorbed by the consumption to Network where as another material left with Price Diff which is causing a diff in GL and Inventory Values .
My question is why this happened where the two material has same setting . Second question , how to adjust the Inventory diff ?
Logicaly this price diff should be absorbed to Project Network .
Thanks
Vijay

Hi,
First of, thanks for the valuable information.
We are getting ready to activate actual costing.
Material ledger has been active for quite some time now (multiple fiscal years), with all materials activated at standard (S) and price determination "transaction based" (2). Costing runs are only run on a yearly basis.
I am currently establishing my conversion plan.
I believe I have all the necessary steps identified (exception made for one little clarification) and am still working the timing.
A couple of questions:
1. Should I update my materials with a price determination value 3 before or after my configuration is imported in production? I understand that the configuration will really fall in place at the time I run actual costing at month end (CKMLCP) but I am wondering if there is any dependency with the price determination update (2 to 3) from a timing/sequence standpoint.
2. Is it necessary to run, mark and release a cost estimate right after the price determination has been changed (from 2 to 3) and before any goods movements take place or does updating the price determination to 3 is sufficient to support actual costing at month end (i.e. is the cost estimate in existence with a price determination 2 sufficient)?
3. Any particular aspects/steps I should pay attention to as far as going live with actual costing? In general, what would be the ideal sequence of events?
Thanks a lot for your help,
Regards.

Alternative valuation run methodolgy for material ledger

Hi Experts
Does someone can explain me how to customize alternative valuation run in SAP and how to use it.
Do I have to run it from CKMLCPAVR or from CKMLCP.
Can I run for same plant and same period the AVR in CKMLCP ?
On the screen of CKMLCPAVR I don't have nothing in Creat Cost estimate ??
THanks and regards
Djamel

Hi Djamel ,
1. Purpose of Material Ledger Run (CKMLCP) is to calculate actual cost of the product .. and you can update material master with actual cost ( optional step).SAP uses weighted average methord when calculating actual cost.
2. Purpose of Alternate Valuation Run (CKMLCPAVR) is to have a actual cost for analysis purpose . You can use weighted average methord or use can use FIFO , LIFO valuation methord also . Ifd you want to use LIFO/FIFO methord .. you have to configure LIFO/FIFO customization and use the standard BADI give in the SPRO menu .
3. CKMLCP and CKMLCPAVR have no depencies and you can run that for same plant .. or you can run anyone of them . Both the purposes are different .
4. On the screen of CKMLCPAVR I don't have nothing in Creat Cost estimate ?? Implement SAP Note 659447 - No process steps in AVR cockpit ... it will solve your issues .
5. For CKMLCP.. OBYC settings are as per transaction key "BSX" ... OSS Note : 908737 - Post Closing in Material Ledger
6. CKMLCPAVR -- OBYC settings are as per transaction key "BSD " .. as if required manual entry has to be done to have actual costs . So , inventory account must have manual updation tick in GL master
7. To sum -up... OBYC settings you have to do for CKMLCPAVR and any valuation approach you use other than default SAP weighted avergae methord ( LIFO or FIFO)
Hope it clarifies ... Do revert bac for any further clarifications..
Regards
Sarada

Error Message :Valuation area 1000 not yet productive with material ledger

Dear Floks,
I need some clarification to get rid of this error message and move further.
While saving the PGI I am facing the follwoing error message: "Valuation area 1000 not yet productive with material ledger----
The material ledger has been activated for the valuation area but
material data has not yet been converted in theis valuation area."
Plese respond with the solutions ASAP.
Thanks in advance.
Regards
ANGKS

Hello Padmaja,
You will to check the following before activation the Val.area
1) OMX1: Check if ML is active against the plant IF NOT
2) Use tcode CKMSTART - Enter Val area - EXECUTE.
Regards,
Manoj Reddy

Material ledger is not active in valuation area C002

Dear All,
I have a Scheduling Agreement for a material 'A' with Vendor 'V' with diff prices with validity dates, I did the GR & when i am posting the invoice thro' miro, system is throwing error as above Material ledger is not active in valuation area C002 Why should I activate the material ledger here ? Pls suggest how can i solve this ?
regds,
Kallu

Hi
For a Particular material, Material Ledger is active or not? Can be checked in Accountig view of Material Master.
Why we need Material Ledger?
A fundamental task of the material ledger is carrying inventories in multiple currencies and/or
valuations.
Material inventory values are normally carried by the SAP system in one currency. The material
ledger component enables the R/3 System to carry inventory values in two additional
currencies/valuations. Therefore, all goods movements in the material ledger are performed in up
to 3 currencies or valuations. Currency amounts are translated into foreign currencies at
historical exchange rates directly at the time of posting. Businesses such as those in highinflation
countries can therefore carry their inventories in a more stable currency (such as US
dollars). This reveals inflationary effects on inventory values.
If you use transfer prices to represent value flows in your company in different
valuation views, you must use the material ledger. This allows you to carry your
inventories in three different valuations (legal valuation, valuation for reporting
purposes, and profit center valuation).
Before activating the material ledger, make sure you know which currencies and valuations
you want to use, because you cannot go back and change the setting.
Activating the material ledger is a prerequisite for using multiple valuations.
Thanks
Raman

Material ledger is not active in valuation area S001

Dear All,
I have created a Scheduling Agreement & did the GR. When I am doing invoice posting system is throwing error as Material ledger is not active in valuation area S001
What might be wrong here ? For same material if I create PO then everything is working fine. Problem is only with SA.
regds,
CB

Hi,
Please check your Material Ledger Activation setting for the Valuation AreaC002 in T-code OMX1. The Check box for the ML activation against the Valuation Area-S001 may be ticked. After activation/ticking this box, T-code CKMSTART was not executed to complete the ML activation. If you want the activation of Material Ledger, you have to run T-code CKMSTART to complete this ML activation or Otherwise uncheck this box. I hope this step will resolve your issue.
Regards
appalas

General Ledger Special Ledger out of balance *URGENT* Material Ledger???

We've activated Material Ledger in a company code in Jan'07.
Accounting document created because of 102 Movement type FI document looks fine but in Special Ledger document dollars against Group currency are posted to Price Difference account? This is not happening for all 102movement type documents but i couldn't establish the pattern! Any help would be highly appreciated.
Some background:
Company code and Controlling Area both got USD as main currency.
This problem is sporadic and with 102 movement type only.
Materials causing issue got Price control 'S' and Price determination '2"

Hi Raghu,
Probably I am mistaken; I was talking about SPL field movements and user exits used there. you can check that through transaction GCB2 where ledger is assigned to a company code and then u can drill down to activity and field movement assigned to the activity and can find if a user exit is used to post to a price difference account.
Let me know if I am talking about relevant stuff here. If it is with SPL then I can help u more.
Thanks,
Kumar

GR/IR account problem with material ledger

Hi,
I just found an issue as effect of material ledger implementation.
after the material ledger is active, when we post a transaction in foreign currency (invoice receipt), the LC 2 amount of GR/IR account is somehow different from the document amount, and the difference is transferred into Material price difference account that we maintain in OBYC - PRD transaction.
because of this, the LC2 amount of GR/IR account can't be cleared.
any suggestion, please?
thanks,
Nasikhin

hi,
It will affect your valuation for the document, which are still open..
You shd run this only after closing all documents and completing whole MM cycle..
Once this is run, you can't go back and make settlements...
So, beware...
Regards
Priyanka.P

Material Ledger Unit Of Measurement different from Material Master

Dear Team,
In my client, there is a difference between unit visible in CKM3N and MM03. The base unit of measurement in MM03 is MT. Other than that, there are some other units maintained (not M3) in additional data tab in material master. In CKM3N, the visible unit is M3. M3 is not present anywhere in MM03.
Why would such unit flow in material ledger table? (CKMLPP has unit M3). Please advise.
One more observation is that when there is some price change document in Material Ledger, the proper UoM (MT) is being captured. Only in the basic price determination structure visible unit for each head is M3. Please check the attached screen shot.
Any help would be appreciated.
Thanks.
Jay Shah.

Hi..
Refer to Data Inconsistency of BUOM in Material Ledger Tables

Material Ledger - confirmation in different months

Hi Gurus,
I have a problem as follows:
We are using material ledger for actual costing. When we post partial confirmation for a production order in period t, goods receipt and goods issue is posted for period t. However, in some cases, confirmation is posted although one material has not arrived at the factory yet and that material is not assembled on the finished product in period t, but it is assembled in period t+1. In this case, when we close material ledger, we receive an error as "there are nondistributed rows" in transaction CKM3. How can I solve this problem either in logistics side or financial side?
Thanks and cheers,
Fatih Zenginer

Hi Faith,
Are you familiar with transaction CKMVFM - Value Flow Monitor? You can analyze Not Distributed differences with this transaction. The price limiter is the key.
Thanks,
Greg

Valuation area not yet productive with material ledger

While doing goods receipt at MB1C,i got the below error:
The description of the error is given below
Valuation area XXX2 not yet productive with material ledger
Message no. C+020
Diagnosis
The material ledger has been activated for the valuation area but material data has not yet been converted in this valuation area.
Procedure for System Administration
If you want to work with the material ledger, choose Accounting -> Controlling -> Actual Costing/Material Ledger -> Utilities -> Production Startup.
There you can convert the data for the material ledger by following the instructions in the online documentation.
Note
Setting the material ledger to productive cannot be undone.
See also:
Actual Costing/Material Ledger in the SAP Library.
The implementation guide for Actual Costing/Material Ledger.
Can you kindly suggest me how to fix this error.
Regards
Sabera

Hi Sabera,
The Valuation Area is not activated for your material ledger. Go to SAP Access>>Accounting>>Controlling>>product cost controlling>>Actual Costing>>environment>>Production Start up>>Set Valuation area as productive.
If you already activated Valution area in to Productive Statge.
Then go to T.Code OMX1 and for your valuation area XXX2 tick the ML activation box.
the error wont come
regards
srikanth

Material ledger Tables

Dear All,
Issue: Not able to post Good receipt due to the error that material does not exit.
Background: we have activated user exit in material master for material type ZROH and assigned a internal number range to it in MMNR. this user exit will append the material group mentioned during master creation in the internal code generated by system.
example PPMM is the material group and the internal code generated by system is 122222 so when we save the material in mm01 our material code is PPMM122222.
we are trying to do GR by 501 and now the material ledger function module is truncating PPMM from the material code and its trying to post document with 1222222. which then goes into error that material does not exist.
Analysis: I have checked in the MARA/MARC the material code is PPMM1222222. but i guess in some table whcih is relevant for material ledger system has stored internal material number 1222222.
So I am looking for tables or solution for this isssue

Hi Expert,
Please refer the SAP Standard Material Ledger Tables:
The following tables contain data that can appear in the material ledger documents:
Table - MLHD - Material Ledger Document: Header
Table - MLIT- Material Ledger Document: Items
Table - MLPP - Material Ledger Document: Posting Periods and Quantities
Table - MLPPF - Material Ledger Document: Field Groups (Posting Periods and Quantities)
Table - MLCR - Material Ledger Document: Currencies and Values
Table - MLCRF - Material Ledger Document: Field Groups (Currencies and Values)
Table - MLCRP - Material Ledger Document: Price Change (Currencies, Prices)
Table - MLMST - Material Ledger Document: Costing Run Header Data
Regards,
GK
SAP

Material ledger Clarification.

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