Production Order Settlement to GL by Labor ,Material,Ovhd,etc

Our client would like to settle Cost Collectors and Discrete Orders, make to stock, to the GL by Cost Element Category. The goal is to definitely have the variance account by cost element category. They may also want to have the Delivery to Stock COS account and settlment offset by cost element category.
I am beginning to evaluate alternatives.
Has anyone done this before and what methods di you follow.
Thank you,
Jeffrey Webber
[email protected]

Dear Sadasivan,
Will you explain in details, we have gone through the suggested path, where there is only two defaul rules
PP1 - Production Full Mat. Settlement
PP2- Production Periodic Settlement
Actually we want to settle the production order variance as a financial variance through cost center, we don't want to settle this variance to the materail. Currently while doing the settlement, system posting the journal entry as
Inventory Account   Dr.
To COGM               Cr.
We want the accounting entry as
Price Variance       Dr.
   To COGM

Similar Messages

Production order settlement in case of non valuated material

Hello guys,
Our client wants some of the materials have to be non valuated. These materials are raw materials and SFG also. We can assign UNBW material types to those materials.
I have created one material for test purpose. It doesn't contain the accounting view so as no valuation class. BOM of it , doesn't contain any component as client doesn't want to show any consumption on production order.While creating the order for that material system asks for the settlement rule. I skip that step and create the order. I do GR for the same.
My question is, is production order settlement essential for these orders? What if we don't settle the order. No activity type has been assign to the work center.
Kindly give ur valuable inputs.

Hi,
No need to create material as UNBW type.
Normal ROH, HALB, FERT material type we can achieve this.
In the BOM of FG or SFG goto item detail screen there is a tick mark in costing.
Remove the tick by OS23 - BOM status.
Now you can do your production as regular. But cost will not get update.You can do regular settlement also.
Regards,
Dharma

Production order settlement posting

Hi all,
For our production order settlement now, it is posting to:
Debit u2013 Production Order settlement (OBYC --> GBB --> AUA )
Credit u2013 inventory
For the credit posting though, in OBYC --> PRD --> PRF it is set to hit the 'cost of goods sold' account instead of the 'inventory' account. What can be causing it to hit inventory?

Dear,
In production order, there are 3 elements. 1 Material consumption 2 inventory change and 3 is confirmation on which planned cost and actual cost is determined.
Material consumption and inventory change is directly relevant to stock of materials but confirmation is only relevant to activities e.g. labor, machine, FOH and setup.
Settlement is difference of plan and actual cost on production order. This difference can be due to either first 2 elements or 3rd element i.e. activity. That's why it can not be "inventory' account".
Thanks
Muhammad Ashfaq

Production Order Settlement

Dear All,
When I am trying to settle production order ( T.code: KO88 ) I am getting the error as
Moving average price for material is negative: 100504 2300
Message no. M8783
Kindly suggest remedies for this.
Rgds
Srini

Normally what happens is that when you have a material with price control as moving average instead of standard price. The moving average is updated when you do production order settlement
In your case, the settlement is trying to bring down the price to negative. Check this would resolve yr error.
You might want to change the materials from moving average to standard or check why the settlement is taking your moving average to negative.

CO - Production order settlement(KO88)

Dear SAPns
1.Explain why the production order actual settlement have to do.
2. What is the financial impact (P&L and B/s) due to settlement of production order
3. Where/How the actual cost is calculated?
4.What is the benefit to do the settlement of production order.
Anybody have document regarding above pls send me.
My Id : [email protected]
Regds
Tamil

Hi,
Production order settlement is done to capture the variance and the WIP to the header material of production order. On execution of the settlement the entries for FI will be posted with respect to variance and WIP
Regards
Kaarthik.D
Assign points if useful

Production order settlement info

Hi,
In production order settlement category is MAT.Some times it is CTR .But costing varient is PPP2.In settlement configuration i check that Allocation structure is A1 ,PA transfer sture is A1 butdefault object trype is blank . So how system take it MAT some times CTR sometimes and wt is the impact and wt is the meaning of this thing when production settlement i is happened ?
Thanks & Regards,
Debashis

HI,
You can check order type in the Production or Maintenance order as Type.
Check the Order Type in T.code KOT2 and view details for your order type in which you can see the settlement profile. The settlement profile(T.Code OKO7) will have the Default object MAT or CTR etc.
Costing variant doesn't have any relevance.
Generally all maintainence order will be settled to cost Center.
And Production Order will be settled to Material.
At the settlement all the costs incurred for the production order will be settled (Moved) to respective Finished product if it is MAT and for Cost center if it is CTR.
The accounting entries for production order will be
Price Difference F.G A/c DR
To Change in Stock A/c Cr
or Vice versa.
Regards,
Raj

Production order settlement variance button

Hi,
I check the settlement of production order and would like to clarify.
In the settlement rule, the account assignment category is MAT, when double click the rule or click settlement variance button, it shows category PSG.
why there are 2 settlement? for settlement to asset, there is only 1 and no settlement variance button.
so why production order settlement has 2 settlement?
Thanks

Hi,
On settlement of Production order, two documents gets created one is Accounting document for posting the variances to Accounts and the Profitability analysis documents.
This is because, when COPA is activated, the Sold quantity in copa is valuated using the Standard cost estimate.
For eg: if the SCE of X material is 100 Rs. and Billed quantity is 10 Qty, this billed quantity is valuated using the 100 rs and 1000 Rs is transferred to COPA as COGM.
But when production is carried out, the actual cost can be different from that of SCE. I,e it can be 120 Rs.
Hence there is a difference of 20 Rs with which inventory is being valuated less in both Accounts and also in COPA. Hence the same is settled to the respective module on the settlement of Production order so that you have FI and COPA gets reconciled to that extent.
But Asset settlement we are valuating it with full amount of acquisition. and there is no standard set for the same. Hence the result.
Thanks & Regards,
Ravi Kumar

Production order settlement accounting entry

Hi,
Can u gibve some link what is production order settlement , and how the accounting entry is generated, our PP person have done the settlement in april 2010 but accounting entry are not updated in the corresponding g/l account how to check this.
regards,
zafar

Production order settlement is just a process of closing the order after goods recipt (production) is being booked in system
Production order settle the costs to CCNs from the orders. It doesnt have any entry unless under / over absorption. In that case following entry will be generated (i.e. of difference amount)
Inventory Change Dr. To Inventory & vice a versa as the case may be of under/over absorption.
If you go thru MB5B for the material, you will find the same without any Mvt. type.
Hope it is clear.
R/s

Authorization check for production order settlement

Hi All,
Production order settlement currently can be done by any user of any company code. there is a high risk involved in the same since unauthorized postings may happen. Hence we need to add authorization check for production order settlement. Can we maintain the same at the plant or the company code level?
Waiting for your replies. Thanks in advance!
Regards,
Aman Goel

hi
What venki has told abt the exit, its absolutely correct.Even i have used the same exit
     From table CAUFV pick Material(PLNBEZ),Basic Start Date(GLTRP),Plant(WERKS) .
     Pass parameter Material(PLNBEZ) and Plant(Werks) in table MBEW in respective fields i.e. Material(MATNR) and Plant(WERKS).
     Pick the latest record for the current period(LFMON) and year(LFGJA).
     Pick Product Cost Estimate number(KALN1) from the record and pass it to table KEKO.
     Check if Production Order Basic Start Date(GLTRP)<= BIDAT, if NO post Error Message.
This is the FS for EXit PPco0007
Reward if useful
Amit

After production order settlement, where does the cost go?

Dear Experts,
I understand after we did the "order settlement" for production order, the cost will be settled to material manufactured from the said production order. Say, the total cost is $10,000 to produce 1000 units of finished goods (FG), then the cost settled to each individual FG at $10 each, am I right? Where can I see the settled cost in the material master?..
I checked in the cost center report, S_ALR_87013611, I can see the cost Credited from "production" cost center with a breakdown in settlement cost element such as machine hour, setup and personnel hour. I understand the other side of Debit was to the production order, and only after order settlement, I'm not sure which cost center will be Debited.
That would be the CO side, how about the FI, would there be any cost posted to the GL side after production order settlement to the material?
Please advise..
regards,
Abraham

Hi Abraham,
It's not the button i mentioned. I was just trying to take u to the accounting document from the settlement screen. well just drill down the settlement screen and u'll get it. No big deal.
But more important is the concept. I'll share my understanding here. (cost by production order)
Any value that flow into controlling module should have a cost object. Here production order is the cost object.
First u create a production order (cost object) for say 1 unit of X with a std price of Rs. 10
Std price comes frm material master as a result of std cost estimate
U start production - Raw materials are consumed - 2 qty x Rs.3.
Entry RM Consumption Dr Rs. 6    Inventory Cr Rs.6 (Prod order is debited with Rs.6)
Activity (Let's say machine hours - 3 Hrs x Rs.2) According to the routing it was 2 hrs but actual production took 3 hrs.
Entry - None - But production order is debited with Rs. 6.
When production is complete for 1 qty of X, entry flows
Finished Goods Dr Rs.10    Change in Stock Cr. Rs.10 (Production order is credited with Rs.100
Abraham, now visualise both sides of the production order. It will have debit of Rs.12 and credit of Rs.10.
Now accountant sees the production order and confirms the values are ok and puts the status of TECO to the order. which means the order is technically complete.
Now when u run the order settlement, this production order is picked up by the system (due to it's status). System sees difference between debit and credit of Rs 2.
So it cedits the production order with Rs. 2. Now both debit and credit of production order is equal (Rs.12)
Entry Price diff A/c Rs,2     Change is stock A/c Rs.2
Now this rs. 2 is settled to COPA. It does not flow to material.
Reason: in a std costing system materials are valued at standard cost and
Hope this helps. Do revert in case of doubts.
Best Regards
Vimal

Error while doing production order settlement

Hi frds,
When I am doing the production order settlement, I am getting the following error
" There are no accrued amounts; settlement is not possible".
The status of the order is TECO CNF DLV PRC BASC BCRQ GMPS MANC.
Rajnish

Rajnish,
Please check if there is cost balance for the order, to me it looks like the order is already settled. In the order display mode (CO03) menu bar Goto->Costs->Balance.
If balance exists then the problem may be related to the settlement period used in the Intial screen of transaction KO88. Please check the cost incured period and use the same period as settlement period.
Regards,
Prasobh

Production Order Settlement Process with respect to a Project

Hello All,
I know about normal Production Order Settlement Process in discrete industries.
Can anyone give me the steps for the Production Order Settlement Process if the Production Order is created with respect to a Project in SAP PP- PS Integration Scenario.
Thanks in advance for your support.

Hi Experts,
Can anyone clarify my above queries.
Thanks in advance for your support

Auto Production Order Settlement

Dear experts,
Please advise how to implement the auto production order settlement (configuration, exit)?
i need to automatically carry out the settlement procedures (in the background?) as soon as the production order gets the 'TECO' status.
I searched for similar question but not answered
http://scn.sap.com/thread/463939
Thanks for your kind suggestions in advance.
Best Regards,
Gary

Hi Gary,
What I meant here was, let's assume you have 10 plants where TECO would be done for Prod. Orders
Assuming that you split the batch jobs based on the number of the open Prod. Orders in a plant and then have them run once a day to avoid excessive use of system resources.
The program can be found with search string *CO88* in SE38.
The settlement would happen for the Orders which has the TECO status as per the standard SAP design, only difference would be that the once having no changes would be ignored and with the newly TECOed Prod. orders would be considered for the settlement.
Hope that helps!
Varshal Kachole
The SCN Rules of Engagement

Production Order Settlement Function Module

HI,
Trying to find a BAPI or Function Module to used that will perform a transaction K088 Production order Settlement. Can anyone tell me is one exists?
Thanks,
Chris

Dear friend,
I had the same requirement as you have defined, Did you get any function module for PP production order settlement (KO88). If there please mail me on [email protected]
Thanks in advance,
Regards,
Mubashir

Production order settlement period

Dear Friends,
I have settled my production order in period 4 (Let us assume). After some time ( let us assume 15 days) i wants to reverse my order. But by the time of 15 days my period has been changed from 4 to 5. I have forgotten on which period that particular order has been settled, so that i can reverse the order on the same period.
Could anybody guide me , How to display production order settlement period?
Thanks
Senthil

Hi Mahesh,
I could not find any period related information under change management option.
But i have found the information under "Header----Settlement rule". Here we can find the details about settlement period (First used and last used).
Thanks
Senthil

Production Order Settlement to GL by Labor ,Material,Ovhd,etc

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