Profitability Analysis (CO PA) in SAP FI

Reimagine everything
Deloitte ERDC Bucharest
March, 2021
SIMPRE –SAP FINANCE Profitability Analysis (CO-PA) in SAP S/4HANA
1

Overview
Agenda for March 29th
Copyright © 2021 Deloitte Tehnologie SRL. All rights reserved. 2
1. Profitability Analysis (CO-PA)
Key concepts and perspectives ~ 30 min
• Basic Concepts of CO-PA
• Current Versions of Profitability Analysis
2. Profitability Management Objects & Reports
• Profit Center Assignment ~ 30 min
• Operating Concern
• Movie Time ~ 3 min
3. Profitability Analysis Workbook
4. Quiz ~ 15 min
5. Q & A ~ 10 min

1. Profitability Analysis (CO-PA)
Key concepts and perspectives
CO = Controlling
PA = Profitability Analysis
Allows the profitability evaluation of specific market
segments:
• such as products, customers and their
summarizations
• organizational units like: company codes or
business areas
The aim is to provide the business owners with
market oriented controlling information to support
the decision making process
CO-PA answers to these questions:

Profitability Analysis (CO-PA)
The main SAP Controlling submodules are the following:
• Cost Element Accounting
• Cost Center Accounting
• Activity-Based Accounting
• Internal Orders
• Product Cost Controlling
• Profitability Analysis
• Profit Center Accounting

Basic Concepts of CO-PA
The basic concepts of CO-PA include the following:
• Characteristics
Characteristics are those entities that you want to
report on. These include divisions, regions, products,
and customers.
• Characteristic Values
Characteristic values are the values that the
characteristics in your report should display.
• Profitability Segments
Profitability segments are the technical definitions of
combinations of several characteristics and their
values.
• Value Fields
Value fields are the amount and quantity fields with
which performance can be measured and analyzed.
Examples include gross sales, surcharges, discounts,
and cost of sales.

Current Versions of Profitability Analysis
1 2
Costing-based CO-PA profitability analysis
groups costs and revenues according to
value fields and costing-based valuation
approaches, both of which you can define
yourself. It ensures access at all times to a
complete, short-term profitability report.
Account-based CO-PA profitability analysis
stores costs and revenues in accounts and
uses cost and revenue elements. This form of
profitability analysis provides you with a
profitability report that is permanently
reconciled with financial accounting.
The main 2 COPA versions are:
• Both versions can be used at the same time, via the Controlling Area

Costing-based CO-PA: Account-based CO-PA:
The main differences between Costing-based CO-PA and Account-based CO-PA
• Reconciliation happens at account group level
(revenues, sales deductions) as values are
stored in “value fields”.
• Data is stored by posting periods and weeks.
We make this settlement on Attributes, at Operating Concern Level (KEA0)
• Transactions can be stored in:
 operating concern currency
 company code currency.
• Stores Data in CE1XXXX to CE4XXXX tables:
CE1XXXX is actuals data
CE2XXXX is Plan data
CE3XXXX & CE4XXXX contain aggregated and
segment level data
XXXX = Operating Concern
• It can be reconciled with FI at account level
through the use of Cost Elements.
• Data is stored only by periods.
• Transactions are stored in:
 controlling area currency
 company code currency
 transaction currency
• Stores data in general CO tables, as below:
Line item actual data in ACDOCA
Line item plan data in ACDOCP

Data Flow in CO-PA
Standard Costing COPA - at the time of Billing the
standard costing will flow into COPA.

Data Flow in CO-PA
Display Billing Document – VF03
The key figure Total Sales
deductions contains all reductions
affecting sales revenue (such as
customer discounts, quantity
discounts, promotions, cash
discounts). This is an expense
account, thus a Cost Center was
assigned to the posted doc.

• In SAP S/4HANA, the universal
journal (ACDOCA) is a single
storehouse of journal entries across
multiple applications.
• No reconciliation necessary
• Real time reporting across all
dimensions
• Improved speed and content of
reporting
• Memory footprint reduction
• This ensures greater transparency,
and makes the information easy
use
ACDOCA Table

2. Profitability Management Objects & Reports
Profit Center Assignment
 Profit Center – represents an internal organizational sub-unit that operates independently in the market and is
responsible for its own costs and revenues.
Companies are structured into Profit Centers by assigning the master data of each profit-relevant object to a
profit center.
Profit- relevant objects include:
• Materials
• Cost centers
• Orders
• Projects
• Sales orders
• Assets
• Cost objects
• Profitability segments

Profit Center Assignment tool
• A Profit Center is assigned to each object for which costs or revenues are incurred in a business system.
• The basic purpose of creating a Profit Center is to analyze the revenues and costs for a particular product
line, or a plant or a business unit.
• Thus, when you post the data to the original object, the system automatically posts this data to the Profit
Center.
• In this way, the actual data for the assigned objects in the Profit Center is updated.
• Cost centers, business processes, internal orders, projects, production orders, and cost objects have fields for
profit center assignments in their master records.
• Profitability segments do not have master records. A profitability segment combines characteristics such as:
 Customer
 Product
 Plant
 Distribution channel
 The profit center is always one of the characteristics
The Profit Center can be derived automatically from the material or plant, or from other characteristics.

Operating Concern
• The Operating Concern is the key
organizational unit in CO-PA
• It defines the extent of the combination of
marketing and sales information in CO-PA
• When organizational structures are defined,
several controlling areas are assigned to one
operating concern
• The controlling area is an organizational unit
that defines the independent cost accounting
operations of the company, such as:
 cost center accounting
 profit center accounting
 and order accounting.

Copa Planning
Planning in COPA can be made at various levels. SAP allows to plan:
1- By manually inputting figures for segments. You need to create planning layout in KE14, this can be used
then in KEPM (Planning framework).
2- By manually inputting Sales Quantity only, and rest of valuation would be done using valuation strategy as
configured in IMG (KE4U) & Revenue would be planned using costing sheets.
• First method is quite straightforward; where there is a lot of manipulation of data, as required. However in
second method; only quantity is planned; rest of valuation is done automatically.
Copyright © 2021 Deloitte Tehnologie SRL. All rights reserved.
14

Profitability Report
Create Profitability Report – KE31
Here we can create segment level reports.

16
Execute Profitability Report – KE30

Display actual line items – KE24

3. Profitability Analysis Workbook
Master data
Create Profit Center – KE51
Create Primary Revenue/Cost Element – KA01
Create Operating Concern - key organizational unit in CO-PA
Operating Concern Prerequisites
a. Maintain Value Fields – KEA6
b. Maintain Characteristics – KEA5
c. Set Operating Concern - KEBD
d. Maintain Operating Concern – KEA0

Create Profit Center - KE51
Enter the
Controlling Area in
which the Profit
Center is to be
created
Enter the Profit
Center ID and click
Master Data

In the Basic Data tab, we enter the below
information:
• Analysis Period – Validity Period for the PC
• Profit Center Name and a short description
for the Profit Center (Long Text)
• Person Responsible for the Profit Center
• Profit Ctr Group to which the Profit Center
belongs to
Create Profit Center - KE51

In the Company Codes tab:
- Add the details needed for the Profit Center

Go to Save and then press the Activate icon.
Once the item is saved, the system will indicate the
inactive status. Click on the icon , then activate
At the end, this message will show that the Profit
Center was created.

Create Primary Revenue/ Cost Element – KA01
• Cost Elements (CE) are used in management accounting
and assigned to various objects like: Cost centers, Internal
Orders.
• CE’s are used to classify and analyze cost for internal
reporting purposes.

24
Create Primary Revenue/ Cost Element – KA01
Save
• The revenue element is also a primary cost
element but unlike primary cost elements it has a
corresponding revenue G/L account in the chart of
accounts under the P&L.
• The prerequisite for creation of these elements is
to have a corresponding G/L account(s). Without
them the SAP system will not allow to create
primary cost or revenue elements.

Create Operating Concern – Prerequisites
Step 1
Firstly, we check t-code OKTZ, for the Cost Component
structure.
We select the layout.
And choose, Table View, then Print.

Create Operating Concern – Prerequisites
Step 2
We will copy the data from this Cost Component
Structure into an excel file.
Based on these values here we will create the
corresponding Value Fields for standard and actual
costing.

Create Operating Concern - Prerequisites
For Costing-Based COPA the Value Fields are required,
but for Account-Based COPA, not.
Go to SPRO, then to SAP Reference IMG
And follow the path on the left side, or directly
access T-code: KEA6.

c. Set Operating Concern – KEBD

Create Operating Concern
d. Maintain Operating Concern– KEA0

c. Maintain Operating Concern– KEA0
Firstly, we enter the Operating Concern.
Data Structure: (at this step the data is pre-defined)
Then we go to Create
The below message will show. Press

Data Structure: We may choose any of the Profitability
Analysis Types, depending on the business needs.
Add details for Description

Attributes:
We choose the:
• Operating concern currency
• Fiscal year variant
For a complete profitability analysis it is recommended to check
both the:
• Company Code Currency
• OpConcern crcy, PrCtr valuation

Then, we go to Save, and Create
Afterwards, the status will change to red:

Here, we are able to assign the needed
Characteristics to the Operating Concern.
We select the line in Transfer From and move it to
the Data Structure.
This message will show:

We will execute the same for the Value Fields.

1. Then we press Save and Activate.
2. Go to back, and select yes. 3. Go to back, and select yes.
4. Then, the Status will turn green.

4. Quiz

4. Q&A
If you are interest in a consulting career with SAP, please send you CV via email to:
Deloitte Technology, HR Department, to: vgancea@deloittece.com
4. Q&A

Profitability Analysis (CO PA) in SAP FI

Recomendados

Recomendados

Mais conteúdo relacionado

Semelhante a Profitability Analysis (CO PA) in SAP FI

Semelhante a Profitability Analysis (CO PA) in SAP FI (20)

Último

Último (20)

Profitability Analysis (CO PA) in SAP FI