Problem with WBS settlement to G/L accounts

[Former Member]

Hello Experts 

     I'm having a problem while settling cost & revenue to G/L accounts. Our business case requires us to summarize project cost & revenue in 1 P&L G/L account. To do so, we settle the project to a G/L account and this account must not report back in PS.

While settling credit amounts to the G/L the system automatically assigns the WBS element as account assignment to the line item. As a result, the system issues an error message requiring the creation of cost element for the settlement receiver G/L account.

When we do this and view the "By Cost Element" reports for the project, we find that the amount stays on the project as it has been debited and credited to the same WBS element.

This is strange because the system does not require a cost element when we settle debit amounts to a G/L account. And the costs are debited to the receiver G/L without account assignment and the WBS element is credited and its balance becomes Zero.

My allocation structure is configured to settle "By Cost Element".

Can you help me solve this problem please or explain why the system behaves this odd!?

Thank you.

[DaveS4]

Ahmed,

Please follow the below and you shouldn't have any issues on the settlement accounts:

1) The target P&L account (a Field Status Grp only with Profit center) should NOT be a cost element. If the cost element exist then delete it.

2) Create the settlement account (P/L) and its cost element type 22 (ext. settlement). As mentioned before put this account into the configuration of Allocation Structure - OKO6

3) In the settlement rule, double click and expand it, plug the Profit Center for the target account. Or you can define a substitution for the profit Center to that account.

I hope this clarifies,

Regards.

Dave

[Former Member]

Hi Dave,

     It Didn't work. system is still issuing the same error

Create account 800XXX for 30.11.2015 as a cost element in controlling area XXXX

Message no. KI280

I even tried to suppress all fields in the field status group, still didn't work. I assigned the same field status group (with no allowed fields) to another receiver G/L that has a cost element (which is wrong), the system still posted the settlement of revenue to the WBS forcibly !!

[DaveS4]

Ahmed,

Please check the OSS Note 87564. It has a suggestion may be it works. However your issue may be like that:

If COPA is active, then ECC wants to settle all Revenues to CO, therefore forcing them settling to COPA.

If the note above doesn't work, then tell your business all revenue must be settled to COPA, make adjustments accordingly.

Regards,

Dave

[Paulo_Vitoriano]

Hello Ahmed,

Just trying to avoid prototyping the system this time... As I understood no issue to G/L P&L "cost" without a cost element, but an issue with G/L P&L "revenue" without a cost element?

Please check field status groups for that G/L account, maybe WBS is mandatory there.

If the issue is really around the second G/L account master data you can test that by specifying the first G/L account as receiver.

Thanks,

Paulo

[Former Member]

Hi Paulo,

     Yes you understand correctly but there is more below

     and I checked as you suggested, but WBS was optional in the field status group.

On further testing of settlement, This is getting weird:

a) I tested while having only cost on the WBS (CE Cat. "1") (Dr. or Cr. Balance). In all cases, the receiver G/L must be without cost element. If the receiver has a cost element, the system asks for cost object "which is not provided by settlement" --> That's OK

b) I tested while having only revenue on the WBS (CE Cat. "11") (Dr. or Cr. Balance). Same behavior as point a) which is OK too

c) I tested while having both revenue and cost on the WBS (CE Cat. "11&1"). The system demands that the receiver G/L must have a cost element. If I provide a receiver G/L that has a cost element (regardless of its category), the system demands I assign a cost object "which is not provided by settlement".

          The result of point c) =  No settlement can be executed due to errors.

d) I tried to separate things using source structure (one for cost and one for revenue). Settlement only works if the receiver G/L of revenue source has a cost element. And the receiver G/L of cost source has no cost element. And not the other way around.

          The system assigns the WBS to the revenue receiver G/L account !!

          The system doesn't do the same to the cost receiver G/L account.

     Accordingly, revenues settled from the project are reported right back to the WBS element ! this also doubles the revenue after settlement in the "Hierarchical Reports" while keeping the revenue to the same amount in the "By Cost Element Reports" only changes the carrying cost element.

Help!

[Paulo_Vitoriano]

Hi Ahmed,

Receiver G/L accounts should not be defined as cost elements.

Try using a settlement cost element for external settlement.

Regards,

Paulo

[Former Member]

Hi Paulo

     Yes, I agree with you, they shouldn't. I was just humoring the system to reach final outcome.

And I just tried external settlement cost element for receiver category G/L now. Same problem still exists

Thanks for support,

Ahmed

[Paulo_Vitoriano]

Hi Ahmed,

Before trying to do it myself, can you please try to remove optional WBS from the field status group for that GL account?

Thank you,

Paulo

[Former Member]

Hello Paulo

     The only other option was to suppress the field, I did that, still got the same error.

I believe the settlement transaction is forcing the account assignment in this case and I cannot figure out how or why. Or even why in this particular case of having cost & revenue together on the project (as it didn't issue errors when I had only cost or only revenue).

Many thanks,

Ahmed

[DaveS4]

Hi Ahmed,

We need to separate 2 accounts used in your settlement:

1) The target G/L account that you want to settle the WBS balance can be a P&L or BSheet account. In most of the cases it must be no cost element, since it can create some complication, to use additional cost object for it.

2) The settlement cost element: Since you are settling to a G/L account, you need to use an " external settlement cost element" type 22. Therefore create this account, then create cost element type 22 as well.

once you do this, go to Allocation structure and place settlement cost element type 22 into the category "G/L"

Then you shouldn't have any issues.

regards,

Dave

[kenmelching]

Usually when you settle to a G/L account it is a Balance Sheet account.  And you use External Settlement type cost elements to move the values from the P&L to the BS.

What you are proposing is reposting within the P&L, and P&L accounts should have Cost Elements and if you have a CE you will need a Cost Object.

Do not settle by cost element, use a settlement cost element.  Since you want everything to go to a single P&L account (that doesn't have a CE) use a single settlement CE for everything.

[Paulo_Vitoriano]

Hi Ahmed,

Can you please show a settlement rule corresponding to that error message?

Thank you,

Paulo

[Former Member]

Hi Paulo

These 2 G/L accounts have no cost elements, the settlement of costs passes without errors while the system issues the "Create cost element for G/L 800---" error for the settlement of revenues.

Regards,

Ahmed

[Former Member]

Hello Dave,

     Thanks for the reply. I did Exactly that, and it's leading to the issue I'm facing.

Can you help with this please?

Thanks,

Ahmed

[Paulo_Vitoriano]

Hi Ahmed,

Will it settle if you use same 470??? account for both lines?  Just to understand if the issue is around 800??? account.

Thanks,

Paulo

[Former Member]

Hello Ken,

     Thank you for the fruitful answer. I am facing no issues while settling to a Balance Sheet account. But unfortunately, our business case requires us to use P&L accounts.

In our case, we create no cost elements for these specific G/L accounts (Settlement Receivers) and we still face that issue.

I also created & using the External Settlement cost element type 22 in my allocation structure.

As you can see in the thread above, the issue happens while settling revenues, only on case of having both revenue and cost posted to the WBS element.

I would really appreciate it if you can help us solve this one.

Thanks,

Ahmed

[Former Member]

No, it shows the same error "Create cost element..."

Settling the 2 lines to the same P&L account doesn't work because one source requires a cost element and the other source rejects it.

But I tried to create a copy of 800 account, created a cost element for it, and used it for the revenue line. Only then the revenue source will settle --> but it re-posts that revenue to the project again during the settlement.

[kenmelching]

I am confused on why the client wants to settle to the P&L.  The Costs and Revenues are already on the P&L, now with settlement you want to move these values within the P&L?  This sounds like a reporting requirement rather than a hard accounting requirement.

You might have to use Results Analysis to do this.  It will do what you are asking.

[Former Member]

I agree with you, It is really a reporting requirement rather than a hard accounting requirement, but our client still insists on having this section in the P&L, in which they summarize the revenue and cost of every business area for external users of accounting to see.

But we are trying to focus on the system behavior and technicality. So why issue this error if we had done all the requirements. And why issue the error in the case of having both revenue and cost while settling normally in case of having only revenue or only cost ((with the same parameters & configuration)) !!!

Because if SAP was to prevent this for business needs, then it would be totally prevented to settle on a P&L account in the first place!

And unfortunately, result analysis calculates and posts WIP & Reserve between B.S. & P&L for the Matching Principle of accounting, it doesn't fulfill this need of reallocating amounts within the P&L

[kenmelching]

Enter an Incident so SAP can reply why it works in certain specific cases.

[amr_elsherif]

Dear Ahmed,

I think you will find this configuration under Allocation Structure you use it when settlement WBS.

you can change this configuration from:

SPRO--> Project System --> Costs --> Automatic and Periodic Allocations --> Settlement --> Settlement Profile --> Create Allocation Structure

after that select your allocation structure and go to   Settlement cost elements

if  By Cost element field flagged it mean that settlement with original cost element (settlement will be on the same cost element)

otherwise system will used the assign secondary cost element type 22

BR,

Amr Elsherif