4/22/2015

SAP Material Ledger: New

Tips and Key Updates

Rogerio Faleiros
Franke Artemis Group

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2015 ERP Corp. All rights reserved.

Introduction

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This webinar will show you why companies decides to use

material ledger, what the new functionalities available are, and
help to answer some question such as:
Is material ledger only used to valuate inventory in 3 different
currencies?
Is one material ledger enough?
What should you expect from EHP5 for Material Ledger?
Is Material Ledger ready on HANA ?
Which reports are available for Material Ledger?
How can I solve basic issues in ML?

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Material Ledger Overview

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Material Ledger
Actual Costing
Parallel Valuation (Multiple currencies)
Multiple and alternative Valuation
HANA
Reporting
Material Ledger Tools

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Actual Costing

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Material Leger is the SAP functionality to bring

actual cost to inventory valuation and COGS
Multiple levels are the result of one material
being used in another material
Single-level and multi-level price differences
exist
If one material is used in another material, and
single-level price differences exist for the
input material, this results in multi-level price
differences
Differences are rolled up to finished products
The standard price, the single-level differences
cumulated in the period, the differences between
planned and actual prices, as well as input
material differences (multilevel differences) are
all taken into account.
Up to 3 currencies valuation

D
Semi

Raw

Raw

Wedne
sday,
April
22,
2015

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Finished
Product

And what else?

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Different Account Principles

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Transfer Price ?

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Multiple and Alternative Valuation

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CKMLCPAVR
Alternative material ledger can be created to calculate, simulate,
post different inventory values and COGS
BADI (ENDING_INVENTORY) to change ending inventory valuation
Maintain table CKMLPR_EB to use external price ending (NRV or
FIFO)
Use BADI (CKMLAVR_SIM) to manipulate cumulated data
Use BADI GET_DEFCCS to manual change of material price and cost
component split

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FIFO Valuation

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Customizing

Transactions

CKMLCP or CKMLCPAVR

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FIFO Valuation

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CKMLCP
Leading Ledger

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Leading Ledger (Acc. Modification)

Non-Leading Ledger depending on Account Principle
Post to FI or NOT

More than one calculation available

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1 run

CKMLCPAVR

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NRV and Material Ledger

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Customizing

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Transactions
MRY2

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NRV and Material Ledger

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CKMLCP
Leading Ledger
1 run
CKMLCPAVR
Leading Ledger (Acc. Modification)
Non-Leading Ledger depending (Account Principle)
Post to FI or NOT
More than one calculation available

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What Can You Expect From EHP5 for Material Ledger?

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Dep. Area
01

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Depreciation
Admin. Cost
Centers

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FIN_CO_COGM
Depreciation differences between GAAPs can be allocated to
Asset Accounts, Inventory Accounts, P&L Accounts
Exclusive version to Calculate Alternative activity rate
EHP5 needed
Dep. Area
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Asset
Accounting

Depreciation
Production
Cost Centers

Depreciation
Sales Cost
Centers

Depreciation
Admin. Cost
Centers

Asset
Accounting

Depreciation
Production
Cost Centers

Depreciation
Sales Cost
Centers

Inventory

Inventory

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FIN_CO_COGM

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Exclusive ML version

Account Principle for Material Ledger and Alternative Material Ledger

Specific depreciation Area to posting to a Local Ledger

CKMLCPAVR to calculate new Inventory and COGS.

Customizing

Example

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USGAAP Depreciation

IFRS Depreciation

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What If Your Company Is Not On EHP5?

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A Planned Version can be used to Calculate activity rates

Post to Inventory and COGS values to Delta account or Local
Ledger
OBYC needed for posting in Leading Ledger

With FIN_CO_COGM

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Without

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LOG_MM_SIT

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MM, Stock in Transit and Actual Costing

Allow the company to track stock in transit to external
customers and stock transfer between plants within same
company code or not, in this case keeping the original cost
component split + intra company profit
Old scenario

Comp.Code A
Cost Component Value
Direct Material

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Package
Labor
Overhead
Machine

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Case 2

Case 1

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Miscellaneous
Total

100
5
15
22
8
5
155

Markup =20
Legal

Comp.Code B

Profit Center A

Cost Component Value

Direct Material

Cost Component Value

175

Direct Material

Package

Package

Labor

Labor

Overhead

Overhead

Machine

Machine

Miscellaneous
Total

Miscellaneous

175

Total

100
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Markup =30
Group

Profit Center B
Cost Component Value
Direct Material

185

Package
Labor
Overhead
Machine
Miscellaneous
Total

185

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LOG_MM_SIT

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New scenario
Cost component specific for markup prices

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Case 1

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Case 2
Comp.Code B

Comp.Code A
Cost Component Value
Direct Material

100

Package

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Direct Material

15

Labor

22

Overhead

Machine

Machine

Miscellaneous

Miscellaneous
Mark UP

155

155

Package

Overhead

Total

20
175

100
5

Markup =30
Group

Direct Material

Direct Material

100

Package

Labor

15

22

Overhead

22

Machine

Machine

Miscellaneous

Miscellaneous
Total

Direct Material
Package

8
5

Mark UP

155

Total

20
175

Profit Center B
100
5

Markup =30
Group

Cost Component Value

Direct Material

100

Package

Labor

15

Labor

15

Overhead

Overhead

22

Overhead

22

Machine

Machine

Machine

Miscellaneous

Miscellaneous

Labor

Overhead

22

Miscellaneous

Cost Component Value

15

Profit Center A

155

Package

15

Machine

155

Mark UP
Total

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Markup =20
Legal

Overhead

Cost Component Value

Cost Component Value

Labor

Total

100

Labor

Profit Center B

Profit Center A

Package

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Direct Material

Case 4

Cost Component Value

Direct Material

Cost Component Value

Package

Case 3

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Comp.Code B

Comp.Code A

Cost Component Value

Labor

Total

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Markup =20
Legal

Miscellaneous
30

Total

155

Total

185

8
5

Mark UP

30
185

LOG_MM_SIT

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ROLLUP_COST_COMP_SPLIT

REVAL_MARKUP_AT_ACTUAL_COSTS

DISPLAY_COST_COMPONENTS

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Using this method you can control in Material Price Analysis (CKM3) that all cost components not
relevant to inventory valuation are displayed (and not just the cost component for the intercompany
profit).

GET_MARKUP_COMPONENT

MODIFY_MARKUP

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Using this method you can control that the intercompany profit is calculated on the plan costs of the
sender and not using the actual costs.

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Using this method you can control that the cost component split is also transferred cross-company code
in the legal view.

Using this method you can control that the intercompany profit is assigned to any cost component not
relevant to inventory.

With this method, you can calculate the intercompany profit in accordance with a separate algorithm.

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Material Ledger Accelerator :

Scope and benefits
Whats included
Material Ledger Reporting

Drill Down Reporting for ML

Virtual Info Provider for ML Reporting

with SAP BO BI 4.0 tools

Accelerated Material Price Analysis (CKM3)

Material Ledger Period End Closing

Accelerated actual costing runs

in Costing Cockpit (CKMLCP)

Accelerated BW extraction

Material Selection

Post Closing

Accelerated Price Difference Balance Monitor

2013 SAP AG. All rights reserved.

Business benefits
Usage of the generic tool for drill-down reporting
Accelerated the navigation on the material ledger
document level when showing the pricing
determination
An accelerated reporting on material actual costing
data will be possible based on SAP ERP system
having new modern user interfaces like Business
Objects Explorer or Business Objects Analysis for
Microsoft Office.
Accelerated BW extraction
Check all values posted to price difference accounts
to meet the requirement with very good response
times

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Benefits

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Material value flow is now possible to run without taking long

run time.
Material leger closing performance increased
Top down distribution runs faster
CKM3 document display speed increased

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Which Reports Are Available for Material Ledger?

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CKM3N
CKMLCP and CKMLCPAVR

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CKM3N for Multiple Materials

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KKML0
Drilldown reporting is a powerful and useful report type for
flexible online analysis by characteristics available for each
area. Ex. Material, Material Type, Production Order, etc.
Online
Own Defined reports and forms
No Cost component Split
SAP ML Network Graphics
Webdynpro report based
Own Defined report
Not Online need to run transactions to load reporting tables
No Cost Component Split

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KKML0

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Report Example

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Cost Component cant be displayed using

STD functionality, but can be achieved
using enhancement

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SAP ML Network Graphics

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Material Ledger Tools

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CKMHELP
Material Ledger support tool to identify issues and fix
problem
Used by SAP support team to fix issues in material ledger

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Resources

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http://help.sap.com
SAP ERP SAP ERP Central Component (6.0 SP19) SAP
ERP Central Component Financials Controlling (CO)
Product Cost Controlling (CO-PC) Actual Costing/Material
Ledger (CO-PC-ACT)
SAP Note
659447 - No process steps in AVR cockpit
996304 - Documentation: BADI GET_DEFCCS
1004899 - External ending inventory valuation
896461 - Documentation: BADI CKMLAVR_SIM
1807147 - Network Graphics in Material Ledger

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Questions

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Now:
Ask questions now for immediate answers
Later:
rogerio@rogeriofaleiros.com

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Q&A

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Controlling 2015

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To learn more from Rogerio, attend the Controlling 2015

conference September 21-24, 2015 in San Diego, CA.
Rogerio will present sessions on:
How to avoid the most common SAP CO-PA customization
pitfalls
Guidelines for leveraging material ledger to provide parallel
product cost for inventory using alternative valuation run and
business function FIN_CO_COGM
Expert Led Networking: SAP Material Ledger.

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Disclaimer
SAP, R/3, mySAP, mySAP.com, xApps, xApp, SAP NetWeaver , Duet, PartnerEdge, and other SAP products and
services mentioned herein as well as their respective logos are trademarks or registered trademarks of SAP AG in
Germany and in several other countries all over the world. All other product and service names mentioned are the
trademarks of their respective companies. ERP Corp is neither owned nor controlled by SAP.

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