Accounting Profitability Analysis Simplified CO-PA

The strategic solution under S/4HANA

SAP has implemented CO-PA for Profitability Analysis with the two methods accounting and costing-based profitability analysis. While account-based Profitability Analysis allows an account-based presentation of the profit and loss, costing-based Profitability

Analysis uses so-called value fields. Both methods can be used in parallel and allow EBIT(DA) to be presented using the cost-of-sales method. In practice, costing-based Profitability Analysis has gained acceptance due to its advantages.

ADVANTAGES OF COSTING-BASED INCOME STATEMENT (CB CO-PA):

  • With the quantity reference it is possible to evaluate key figures of the profit and loss statement with quantity reference.
  • Integration in the cost component split of material costing and the variance categories from production allows flexible and multi-level contribution margin accounting.
  • Variance categories from production can be flexibly displayed in separate value fields.
  • Calculatory valuation approaches can be mapped.
  • A sales order can be updated with quantities, price conditions and CoS.

ADVANTAGE OF THE ACCOUNTING INCOME STATEMENT (AB CO-PA):

  • The account-based presentation in SAP R/3 and SAP ECC allows a simplified reconciliation with financial accounting.

"Like a phoenix from the ashes": Accounting profit and loss accounting gains importance with S/4HANA as "SIMPLIFIED COPA"

With S/4HANA, accounting profitability analysis gains in importance because it is integrated into the new data model in the Universal Journal (ACDOCA). This means that each posting in account-based CO-PA is updated directly in the line item table ACDOCA. This ensures that the "Single Source of Truth" approach is also used for

account-based Profitability Analysis. In addition to the integration into the Universal Journal, SAP has also extended the functionality of the account-based Profitability Analysis in S/4HANA and eliminated the main disadvantages as far as possible.

The account-based profitability analysis (AB CO-PA) is integrated in the Universal Journal (ACDOCA)

The main functional enhancements of the accounting profitability analysis in S/4HANA

  • Quantities are carried along.
  • Splitting of cost of sales according to cost component split - The cost of sales is split into its individual cost items (cost component split) on the basis of the cost of goods manufactured calculation and assigned to corresponding primary cost elements. A distinction between fixed and variable components is also possible.
  • Splitting the production variance by variance categories - The individual variance categories from the production orders can be assigned to different primary cost elements.
  • Updating incoming sales orders - Incoming sales orders are updated and evaluated using a special enhancement ledger in the general ledger and the activation of "Predictive Accounting for Incoming Sales Orders" in AB CO-PA with regard to expected revenues and cost of sales / cost of sales (CoS/KdU) in Universal Journal.

Flexible DB calculation and P&L display with AB CO-PA in S/4HANA

[Translate to English:] Erhan Demirkiran

The functional enhancement of the account-based Profitability Analysis in "Simplified COPA" eliminates the difference to the costing-based Profitability Analysis. It is regarded as the strategic solution under S/4HANA and will be further developed by SAP. Organizations planning an S/4HANA transformation and using Profitability Analysis or wanting to use Profitability Analysis as a basis for management reporting should consider the introduction and enablement of account-based Profitability Analysis!

Erhan Demirkiran, PartnerCONSILIO GmbH

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