Result Analysis

[Former Member]

Dear User,

I have need your expert inputs with regard to the Result Analysis

we have a scenario where the client is having the Cost plus contracts i.e., Actual Cost incured + percentage of Profit on the cost.

they bill client on the actual cost incured and bill them by adding the profit % to it. they also book the profit based on this in the books for that period.

here i would required your inputs on which is the best RA valuation method we need to use.

if yu feel yu need more information on the above scenario yu can give me a note for the same.

[Former Member · Accepted solution]

Hi,

For the project completion and billing purpose (as per your requirement the cost incurred+margin) you can better go ahead with CCM (Cost completion method) which will alllow you to do RA after project completion.

Hope this will be of some use for your concern,

thanks

Gangappa

[Former Member · Accepted solution]

Dear Both,

thanks for your valable inputs.

but let brief yu the complete scenario as such.

there are two type of billing scenarios with the user

1. Fixed Price COntract: here the user gets into contract with the customer for the fixed amount, but when there are calculating the profit in the year they will consider / add the profit % and treat that as a reserve( WIP- Asst ) and here the revenue received / planned is also treated as a reserve( Liab)

example: total fixed contract 100, expected total cost would be 75.

period 1 - Revenue 25 and the cost incured is 10. during the peiod closing they treat rev 25 as the advance received and show it in the cost 10 + 2 ( 10*20%) and show this as WIP. this practice continue till the project is completed and once the project is completed they will consider this as a sales and then they will bring back the reserves to P&L.

here there is a posiablity of loss

What exactly we need to do here to capture this scenario in SAP ?

2. Cost plus contract: Here the contract is like Cost + % on cost

example cost is 100 + 20% of the cost = 120

here the total planned cost is 100 and the planned revenue is 120( if the cost remains constant, if cost vary the planned revenue also varies accordingly).

Period1 Cost is 20 then the actual revenue is 20 + 4( 20% of 20) and if the revenue received is 30 revenue received is treated as advance and 24 is treated WIP reserve, this continue till the end and treated as sales at the end of the project and booked into P&L.

help needed....thx & Rgds, Nitya

[Former Member · Accepted solution]

Dear,

You can use Revenue based result analysis in this case,

You can configure with the help of CO consultant and WIP,Reserves,Losses,planed and actual revnue and other alll the required this can be calculated by this mehod.

You can use this in customer project and after reunning the RA you can settle this result analysis values to profibility segment.

Regards.

[Former Member]

Hi,

So you are using RRB,so the better RA Method is either Method 14 Or Method 15.

Thanks,

Muzamil