SAP Internal Order Investment Measure Configuration

8/8/2019 SAP Internal Order Investment Measure Configuration

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SAP INTERNAL ORDER AS INVESTMENT MEASURES

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TABLE OF CONTENTSINTRODUCTION .............................................................................................41. Asset under Construction.............................................................................5

1.1 Define Screen Layout for Asset Master Data .........................................51.2 Define Asset Classes ...........................................................................12

2. Asset under Construction...........................................................................17

2.1 Define Model Orders ............................................................................172.2 Define Order types (KOT2_OPA) ......................................................... 202.3 Define Investment Profile .....................................................................29

3 Planning and Budgeting..............................................................................353.1 Maintain Planning Profiles....................................................................353.2 Maintain Budget Profile ........................................................................393.3 Define Tolerance Limits for Availability Control .................................... 46

4 Settlement...................................................................................................484.1 Maintain Allocation structure ................................................................484.2 Maintain Settlement Profile...................................................................524.3 Maintain Number Ranges for Settlement Documents ..........................57

5 Internal Orders as Investment Measures....................................................595.1 Define Capitalization Versions..............................................................594.4 Maintain Capitalization Keys ................................................................654.4 Determine Accounts for Non operating Expense..................................73


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INTRODUCTION

Dear Reader,

We have pleasure in presenting yet another material to you.

Here we cover Internal order configuration as Investment measures/orders.

Investment orders are used for the production of Capital assets i.e.Construction of Building, Plant & Machinery etc. They are used as cost objectto collect cost and monitor budgets. They can also be used for the purchaseof assets like vehicles, software etc.

Usually companies have huge amount of capital spending. Internal orders areused as a cost object to capture cost and track the budgets. Internal ordersare basically used where the capital projects are very simple. In complexprojects, the project system module is used.

In this material, we basically cover the aspect of capitalization of cost frominternal orders to Asset under Construction (AUC). Capitalize costs from AUCto Final asset.

We cover three following scenarios for capitalization:-

1) Capitalization required in all the 3 depreciation areas Parent, Localand Tax reporting2) Capitalization required in only parent reporting which means expense

out in local and tax reporting3) Capitalization required in only local and tax reporting which means

expense out in parent reporting

So let us begin configuring the investment measures.


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For doing the configuration we use the following path on the SAP applicationscreen:-

SAP Menu Tools Customizing IMG SPRO - Execute Project

The above path will not be referred henceforth; we will directly refer tothe IMG node.

1. Asset under Construction

1.1 Define Screen Layout for Asset Master Data

IMG Investment Management Internal Orders as Investment Measures Master Data Assets under Construction Define Screen Layout forAsset Master Data

We need to define a separate asset class with a separate screen layout forshowing investment measure details. We can use SAP standard screenlayout 4010 (Capital investment measure) or we can copy and create a newone.

In our scenario we will copy the standard screen layout.


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Double click


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We already have 9105 AUC (Investment measure)

Click


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Double click


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Select the Layout created by us

Double click


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Select

Double click


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Come back to the screen

Select

Double click


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1.2 Define Asset Classes

IMG Investment Management Internal Orders as Investment Measures Master Data Assets under Construction Define Asset Classes

Here we define a separate Asset class for Asset under construction which isused specifically for Investment measure.

Important note: You cannot manually create asset under constructionunder this class using transaction code AS01. The assets in this classare automatically created when you save the internal order.


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Double click

The selection investment measure is very important here.


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Click


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Double click

Select

Double click


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Update the following:-

Remove the deactivation and update the depreciation key.

Click on

You also need to do the remaining configuration for this asset classsuch as account assignment. We will not cover this here; since this iscovered in the Asset accounting configuration cd set.


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2. Asset under Construction

2.1 Define Model Orders

IMG Investment Management Internal Orders as Investment Measures Master Data Orders Define Model Orders

Model orders are not orders in the commercial sense, but serve merely asreferences for creating "normal" orders. Model orders contain default valuesfor the orders in an order type. The Model order is assigned as the referenceorder in the order type.

When you create a new order, all the fields active in the relevant order typeare copied from the model order to the new order

We will create a model order with some defaults.

Double Click


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Click


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Click on

2.2 Define Order types (KOT2_OPA)

IMG Investment Management Internal Orders as Investment Measures Master Data Orders Define Order Types

An Internal order is created under an Order type. An order type is used forstoring various control parameters and various defaults while creating aninternal order. It is used for classifying various types of internal orders

according to usage for e.g. internal orders for capital WIP and budgettracking. A number range is assigned to the internal order type.


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Click on

Take a drop in the field Order category and select 01


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Click . You get a message

Click to proceed


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Click

Here you can hide the various fields or make it as required entry or only

display or available for input. Thus while creating internal order only thosefields are displayed and available for input.

Hide some of the fields which are not required

Click on


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Number Range needs to be assigned to the internal order type.We will configure internal number range for our internal order type CapitalWIP (Budget tracking)

Click on in

Position the cursor first on then


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Click

Click


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You will find internal order type Z91C in not assigned

You need to assign the order type to the group we created above.

Proceed as follows:-

Position the cursor on

Click on . Note that it becomes blue.

Select the group we created


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Click

The internal order type Z91C moves under the group which can be seen asfollows:-

Click

Select

Click

Click


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Note that the number range created and assigned, is now displayed in theinternal order type.

Click on

Also assign the model order to the order type as shown below


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Click on

2.3 Define Investment Profile

IMG Investment Management Internal Orders as Investment Measures Master Data Define Investment Profile

The investment profile controls the creation of an asset under constructionbelonging to the capital investment measure when we create a capitalinvestment measure (i.e. internal order).The investment profile created is assigned to the Model order.


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Double click

Click on


Here we assign the asset class 910005 created earlier to the profile


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Click on


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Double click


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Click on


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3 Planning and Budgeting

3.1 Maintain Planning Profiles

IMG Investment Management Internal Orders as Investment Measures Planning and Budgeting Maintain Planning Profiles

Double click

Click on


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Click

Click twice


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Double click


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Click on

3.2 Maintain Budget Profile

IMG Investment Management Internal Orders as Investment Measures Planning and Budgeting Maintain Budget Profile

In order to allocate budgets to your orders, you need to create a user-definedbudget profile, or use one provided in the system.The following parameters are relevant for order budgets:


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Whether availability control runs against annual or overall budget

The activation type controls availability control. There are three activationtypes:0 = Cannot activate

This activity type may cause an already active availability control to bedeactivated.1 = Automatic activation when budget is assignedYou need to maintain at least one tolerance limit for the budget profile.2 = Background activation when percentage of consumption is exceededYou need to enter a Percentage of consumption in background activation. Thepercentage of consumption represents the relationship of committed funds tothe budget as a percentage.You need to maintain at least one tolerance limit for the budget profile to havethe system check the posting.

Double click

Click on

Take a drown in the field


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Click

You get a message


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Click

Click on

Click back twice


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Double click


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Click on


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3.3 Define Tolerance Limits for Availability Control

IMG Investment Management Internal Orders as Investment Measures Planning and Budgeting Define Tolerance Limits for Availability Control

Availability control can help you recognize possible budget overruns in timeand can automatically trigger different actions.You configure availability control for each budget profile. You can define oneor more tolerance limits for the different activity groups within a budget profile.When these tolerances are reached, you can have the system trigger specificactions (warning, warning with Mail, error message).Enter activity group ++ to define the tolerance limits for all activity groups.This activity group is designed to simplify data entry and is particularly usefulif you do not want to define a separate tolerance limit for each group.

In addition to a tolerance defined for "all transaction groups", you can define alimit for a particular transaction group. This additional tolerance limit haspriority over the "general" limit.

Here we will specify usage variance in % i.e. 85%. If the spending exceeds85%, system will give a warning to the user.

We can also specify absolute figures.

Click on

Take a drop down in Tr.grp

Take a drop in Act


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Click on


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4 Settlement

4.1 Maintain Allocation structure

IMG Investment Management Internal Orders as Investment Measures Settlement Maintain Allocation Structures

An Allocation structure comprises one or several settlement assignments. Anassignment shows which costs (origin: cost element groups) are to be settledto which receiver type (e.g. cost center, order and so on)You have 2 options:- You can settle to a settlement cost element or settle bycost element i.e. settle using the original cost element.

We will use settle by settlement cost element.

Select

Double Click

Click on


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Select

Double Click


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Double Click


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Click on


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Click on

4.2 Maintain Settlement Profile

IMG Investment Management Internal Orders as Investment Measures Settlement Maintain Settlement Profile

Here we define a range of control parameters for settlement.


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Double Click

The allocation structure Z9 created earlier is assigned to the settlement profileas can be seen below:-


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Click on

Click twice


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Double click


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Click on


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4.3 Maintain Number Ranges for Settlement Documents

IMG Controlling Internal Orders Actual Postings SettlementMaintain Number Ranges for Settlement Documents

You should define separate number range intervals for settlement documentsfor each controlling area.

Click Group Maintain

Click Group Insert


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Click

Click

Click


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Select

Click

Click on

5 Internal Orders as Investment Measures

5.1 Define Capitalization Versions

IMG Investment Management Internal Orders as InvestmentMeasures Capitalization Values per Depreciation Area DefineCapitalization Versions

The Investment Management System uses capitalization keys to perform asettlement of costs from a capital investment measure that requirecapitalization, and those that do not require capitalization.

This settlement is specific for each depreciation area.

Thus you could decide the portion of costs you want to capitalize to certainspecific depreciation areas.


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Double click

You will find that there exists already some capitalization version, whichare copied when you copy and create the new chart of depreciation.


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Delete the above entries and create fresh capitalization version.

Select the existing entries as shown below:-

Click

Click on

Click on


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Click on

Click Back twice


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Double Click


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We now assign the capitalization version to each depreciation areas.



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Click

Click on

4.4 Maintain Capitalization Keys

IMG Investment Management Internal Orders as InvestmentMeasures Capitalization Values per Depreciation Area MaintainCapitalization Keys

The capitalization keys are used to specify that certain cost elements incertain depreciation areas of the asset under construction are not capitalized(either wholly or in part). These portions of costs that are not capitalized areperiodically cleared as non operating expense. The system transfers theacquisition and production costs, which do require capitalization, to the assetunder construction.


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Click on


Click on

Click


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Double Click

Click on


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Assign capitalization key Z91102 to depreciation area 1, 30 and 70.

Please note that although the assignment is done to area 30 and 70 therequired to cap % is kept blank. These entries are required by system sothat no capitalization is carried out to area 30 and area 70.


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Assign capitalization key Z91103 to depreciation area 1, 30 and 70.

Please note that although the assignment is done to area 1 the requiredto cap % is kept blank.

This entry is required by system so that no capitalization is carried outto area 1.

Click on

Click Back


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Double Click

Here we will not assign any default capitalization key, since usersshould update it manually in the investment measure.


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4.4 Determine Accounts for Non operating Expense

IMG Investment Management Internal Orders as Investment

Measures Capitalization Values per Depreciation Area DetermineAccounts for Non operating Expense

Here you assign the GL accounts for capitalization differences (non operatingexpense) which are area-specific. The account must be assigned to assetclass for capital investment measures.

Select

Double Click

Select

Double Click


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Double click


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Click



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Click

Click on


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Scenario 1:

Capitalization in all three books (Parent, Local and Tax Reporting)

Transaction code: K001

Create Internal order

Click


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Now Update the following:-


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Click

Click on


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Click on


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Now update the capitalization key


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Click


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Click


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Click on

The order is created; display the order using tcode KO03

Click


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Click


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Post costs on internal order


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Click on


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Create final asset

Click


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Click


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Click

Click on


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Update this asset in the Internal order settlement rule


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Click


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Click on


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Settle the cost from the internal order to the AUC first

Transaction code: KO88

Uncheck


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Click


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Click

Click

Click


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Click

Click


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Double click

Click


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Double Click


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Now settle to the final asset.

Click


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Scenario 2:

Capitalization only in Parent reporting (expense out in local and taxreporting)

Update the capitalization key Z91102 in Investment measure AUC in theinternal order creation as follows:-


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Create final asset as shown below


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Click


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Update the depreciation key


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Click

Click


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Click

The settlement rules are automatically created as shown below:-


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Click on


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Post costs on the internal order

Click on

Settle the internal order to the final asset


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Click


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Let us check the asset postings on the AUC

Click


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Double click

To see the posting in parent depreciation area


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Double click


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As can be seen above, the postings from AUC are transferred to theFinal asset.


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Now click area 30 to see Local reporting

There are no values seen in Local reporting depreciation area. Let uscheck the entries that have been posted here.

Double click


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As can be seen above the values posted here are expensed out to GLcode 466020

Double click


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As can be seen above nothing has been capitalized to final assets, sincethe entries are being reversed.

Similarly let us check depreciation area 70 for tax reporting


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There are no values seen in Tax reporting depreciation area. Let uscheck the entries that have been posted here.

Double click


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As can be seen above the values posted here are expensed out to GLcode 466020

in the final asset


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Click


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Double click

Let us check depreciation area 30

Click


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Double click


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Click


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Double click

Scenario 3

Capitalize only in area Local and Tax reporting only and expense out inParent reporting

Create Internal order and the Final asset with capitalization key Z91103


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Click on

Post costs on the internal order


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Do a full settlement to the AUC and final asset


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Check the AUC Asset

Nothing has been posted in the parent reporting depreciation area 01

Let us check the entries that have been posted.

Double click


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As can be seen above the capitalization costs have been expensed inparent reporting.

Now let us check the local reporting depreciation area:-

Click

Double Click


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As can be seen above the values have been capitalized to the AUC

Double click to check the settlement to the final asset from the AUC.


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Click


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As can be seen above the values have been capitalized in the AUC

Double click to check the settlement to the final asset.


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The asset values are now capitalized to the final asset.

Thus capitalization keys play an important role in capitalization andhelps in allocating costs portion only to specific depreciation areadepending on the requirement of each depreciation areas.