Material Ledger - Usage

Dear Team,
Need to know any company have used the Material Ledger for Actual cost valuation is "yes", request to revert for the below mentioned questions:
a) Is it required to have Raw material, SFG, FG & depot FG Item type price control - as "S" type,
b) Is there any limitation,
c) Duirng month end, how much time it takes to run?.
Rgds
Ganesh

Hi Ganesh
We are using Material Ledger.
All the material prices are maintained and standard price. Seems it doesnot take much time to run the material ledger at the month end. I would say its not very abnormal atleast.
Thanks
Ashok
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Cost of goods manufactured vs COGS+ Material ledger

Hi Experts,
My company is implenting Material Ledger. They want to see the actual cost of goods manufactured. We are able to develop the actual cost of goods sold in COPA. The required report is to show:
1- Direct material used at standard + variances (price + usage) to give the actual.
2- Direct labor (standard + variances = Actual)
3- Manufacturing overhead ( standard + variances = Actual)
Attached excel file is showing the requirement.
Your guidance to develop this report by any means (Report painter, BI, other).
Regards
Ahmed Zain Hassan

Hi Ahmed / Ajay.
1. In order reports KKO0, you dont see the revaluation of ML, as you said Consumption and Activities are revaluated at Material level, and as far as i know, theres no way to add records that represent the revaluation.
2. The easy way to have a Order Report revaluated at actual cost is with LIS(Logistic InfoSys), creating a Z infostructure (eg copy lis S027) that store consumption and activity QTY, and a user exit that read the actual cost of consumed materials (depending if this is V, S2, S3) and activities and revaluate. In LIS, there are standard way to "re-post" or repopulate the infostructures. This LIS can be reported with the standard functions (ReportPainter, quers on SQ01), or create a Z tcode that show the info stored in the way you want. Problem: Not all know how to customize LIS, and also you need code in the exit.
3. In my country (Peru), there are lots of companies that develop a Z Kardex valuated at actual cost (because, is a legal requirement), and also create Zprograms that calculate the order at actual cost (indeed, i create this reports twice). Its a bit complex, but not impossible and depends on custo EG if you have multiple valuations, you need to write code in order to get the infor for this specific valuations.
4. About COPA, you can post to copa the Actual Cost Component Split calculated by ML. In this CCS, you can identify the Labor, Direct Materials, and overheads. You have 2 options, You can post the delta to the original field or have an aditional field that store the difference. This stuff is done in KE27, i see 1 example in the SCN (i guess i bookmarked). Its important to understand you dont have the detail of the delta per consumed material, just an agregated value.
Here is the link
http://wiki.scn.sap.com/wiki/display/ERPFI/KE27+Periodic+Valuation
5. There is a new ML DrillDown report functionality. Indeed, i couldnt spend time analizing the solution (my test system is with EHP5 and dont plant to upload the OSS), but i guess this is the future. You can look for info with tcode KKML0 in the marketplace, also check this oss 1639462 - ERP accelerators: enhancements in ML drilldown reporting
My questions:
What you want?
+ Order Report, i mean Cost detaild per Order? The Actual CCS por order?
+ Material Report? I mean, the monthly average of a Fert, and its CCS ?
+ a PA Report, that show Sales (Incomes), and Costs per matiral , split by Direct, Labor and OverHead?
Arturo.

Material Ledger Actual costing - fully costed BOMs and variance type split

We are in the process of activating material ledger and have 2 user
requirements that we have not yet been able to complete. First, the
difference between standard cost and weighted average cost needs to be
split between the variance types (raw material purchase price, raw
material usage, packaging price, packaging usage, etc.). Secondly we
need a fully exploded cost itemization that supports the weighted
average cost, similar to the costing structure pane in transaction
ck13n.
Do you know of any custom developement that might assist us in these
requirements, or have any information that might help us develop a
process to calculate these values ourselves.
Thanks

We are in the process of activating material ledger and have 2 user
requirements that we have not yet been able to complete. First, the
difference between standard cost and weighted average cost needs to be
split between the variance types (raw material purchase price, raw
material usage, packaging price, packaging usage, etc.). Secondly we
need a fully exploded cost itemization that supports the weighted
average cost, similar to the costing structure pane in transaction
ck13n.
Do you know of any custom developement that might assist us in these
requirements, or have any information that might help us develop a
process to calculate these values ourselves.
Thanks

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

Post closing entry in Material Ledger

During running og Material ledger last night, in CKMLCP, we ran post closing entry before we release the cost through CKME. When I tried to release tcode CKME and CK40N, the system gave error message as below:
Price changes for material 200001 is not possible
Message no. C+811
Diagnosis
You want to change the price or release planned prices for material 200001 with valuation type in valuation area 2100. You have, however, already entered actual data or performed a single-level price determination in the period concerned. The status of the material in the period is Quantities and Values Entered.
Price determination indicator 3 assumes that the standard price remains constant throughout the period, so that all movements can be valuated preliminarily with the same standard price. Therefore, you can only change the standard price at the beginning of a period (i.e. as long as no actual data was entered).
System Response
The system does not allow the price changes or the release of planned prices for this material in this period.
Procedure for System Administration
In the future, to automatically release your planned prices upon creation of new actual data you can allow dynamic price release in Customizing for Actual Costing/Material Ledger.
How I can release my standard cost for period 01.05.2010 to 31.05.2010. Please help
Edited by: Ahmed EL Zain on May 1, 2010 10:49 AM

Hey,
What you described is the standard system behaviour.
The price change or release of a cost estimate should always be the
first transaction in a new period, when Material Ledger is active.
Once period status = 30, the standard price cannot be release or
changed. For more details please see note 190707.
The only possible workarounds are as below:
- postponing the costing release to next month
- reversing transactions and usage of note 574930
- using the option LTPC　from note 555176
Best Regards
Young

3 valuations in Material ledger

Hi,
My client's requirement is as follows:
1) Legal valuation has to be in Local currency but on Actual Costing
2) Profit Center Valuation in Local currency but on standard costing - same as Group valuation
3) Group Valuation in Group currency in standard costing - Group valuation
Is this possible when, Actual costing Material ledger implemented?
I imagin, Legal valuation field in Material Master will be updated by periodic unit price when we run CKMLCP. Then Profit center valuation field in the Material Master will be updated when we run CK40N in standard costing PC valuation costing run. Then again we will run ck40n in standard costing for Group valuation to update Group valuation in Material Master.
If my client opts to run ck40n for legal valuation, then he should also be able to mark and release standard cost new price, in Legal valuation field of material master and actual costing will not release standard price for new period.
The requirement is typically complicated, as my client wants to maintain his Global template, though one country comes under actual costing requirement.
I would like to dig out answers from real time experience please.
Cheers,
Ashok

I can give you some information but not everything. I have gone through the deployment of material ledger using 3 valuations, but not the ones you are using. We used Local, Group and Group at Group. All 3 are at actual costing. What this means is that the local currency is the currency in the country where the plant exists. The group valuation is a straight conversion to US dollars from the local currency based on the currency conversion tables M and P rates. Note that both of these first two currencies can include intercompany profit if reflected on the transferring sales order between companies. The Group at Group is the US dollar conversion without the intercompany profit. We find this works for our business.
The other thing about material ledger is that you need to have a standard cost estimate so that material ledger can keep track of the cos component structure. The way it works is as follows:
Say the standard estimate shows labor=$100, materials=$200 and overhead=$300 for a total cost of $600. All transactions in the month using this material use the $600 standard. Now, when material ledger is run at month end, the PUP (periodc unit price) is calculated and let us assume the PUP values are labor=$150, materials=$250, overhead=$350 for a total PUP of $750. Material ledger already has tables with the details of the standard components against every transaction. Now it will apply the remaining adjustments totalling $150 to the proper cost components for COPA purposes. This is pushed to COPA using transaction KE27. Think of it like this...Actual cost is equal to standard ($600) plus/minus variances ($150).
Therefore, you always should have a standard cost estimate when using material ledger. At least that is my usage and understanding. I hope I provided useful information for you in some way.
David

Transfer Price & Material Ledger

We have to have transfer pricing for profit centres. Eventhough we have only legal valuation in our case, Material Ledger activation is mandatory otherwise system does not permit us to activate transfer pricing. Hence, we have decided to activate ML eventhough we dont want it in our case.
Hence we will activate it and we will not perform anyother activity with respect to the Material ledger.
Will this be OK ? Will it affect any other transactions in our case ? Please offer your inputs.

I am very happy to see that lot of deliberations happened from your side.
To be more precise, let me put our scenario as follows:
- We have only one valuation viz. legal valuation (no multiple valuations)
- We want to use Transfer Pricing
- Without Material ledger, system is not allowing to activate transfer pricing.
We wrote to SAP quoting our situation but I think even after 2-3 rounds of interactions, SAP did not understand our situation that we require only one valuation and activate the transfer pricing. They sent us some notes all of which explains about multiple valuations, material ledger and transfer pricing. That is why I have raised this issue here.
Now, the options you have suggested is to use a customized program or activate ML without actual costing.
Yes, we do not want to have actual costing and have informed our client that ML only will just be activated for the sake of TP, wihout any further utilization of its functionalities.
One more pont, regarding settings done, I have not done any settings related to SPRO actual costings. Regarding the 9-11 settings as pointed out by Sarada, I noted that:
9 Assign Material Update Structure to a Valuation Area OMX8 : Settings are done there with std materiial upd structure. (Is this relating to Actual costing ? Pl. tell me).
10 Activate Actual Cost Component Split SPRO : Not activated.
11 Activate Distribution of Usage Variances : Not done anything.

Error in Activating Material ledger

Hi experts,
I'm trying to activate the material ledger first time to the plant. Then an error is displaying. The error is
The value "001" was entered in the field "LFDNR"
This is not possible because it is a numeric field where only numbers may be entered.The length of the field is 000005.
Enter only numeric vallues in this field.
psl do favour to me.
Thanks
Reddy.P.S

Hi ,
Have you completed the following configuration :
1     Assign Currency Types to Material Ledger Type [OMX2]
2     Assign Material Ledger Types to Valuation Area [OMX3]
3     Maintain Number Ranges for Material Ledger Documents [OMX4]
4     Configure Dynamic Price Changes [OMX5]
5     Reasons for Price Changes
6     Define Movement Type Groups of Material Ledger [OMX7]
7     Assign Movement Type Groups of Material Ledger [OMX0]
8     Define Material Update Structure [OMX9]
9     Assign Material Update Structure to a Valuation Area [OMX8]
10     Activate Actual Cost Component Split [SPRO]
11     Activate Distribution of Usage Variances [SPRO]
For OMX1 .. what price determination you are using . Are you using "3" .
If you already have some other plant active , compare the configurations using transaction CKM9.
Once all configurations are completed , then only use CKMSTART.
Regards
Sarada

Difference between Material Master and Material ledger

Can anyone tell me the difference if any between Material Master and Material ledger and its usage and interlink with SAP modules.
Thanks for your time
suresh arya

Hi Suresh,
The application component Actual Costing/Material Ledger fulfills two basic objectives: The ability to carry material prices in multiple currencies/valuations, and actual costing.
The material master records are all information your company needs to manage a material is stored in a data record in the material aster, sorted by various different criteria.
For more information regarding the functionality, you can see in path below, help SAP...
Material Master data:
http://help.sap.com/saphelp_47x200/helpdata/en/03/abb8f85fbe11d396a600a0c930e0da/frameset.htm....
Material ledger:
http://help.sap.com/saphelp_47x200/helpdata/en/a2/5cd63835e211d38a710000e83234f3/frameset.htm..
Regards,
Paulo

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

Material Ledger - Usage

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