In this topic, we described about the below sections -
Profitability Analysis (CO-PA) allows to evaluate market segments or sales organizations or business areas, etc. Market Segments can be classified according to products, customers, orders or any combination of these.
The system objective is to provide sales, marketing, product management and corporate planning departments with information to support internal accounting and decision-making.
Profitability Analysis two types -
- Costing-based Profitability Analysis - Used to group costs and revenues according to value fields and costing-based valuation approaches, both. It promises you access at all times to a complete, short-term profitability report.
- Account-based Profitability Analysis - Used to provide you with a profitability report that is permanently reconciled with financial accounting. The distinguishing characteristic of this form is its use of cost and revenue elements. It uses an account-based valuation approach.
The profitability analysis key components are –
Actual Postings: -
Account based CO-PA:
Sales orders and billing documents can be transferred to CO-PA in real-time from the Sales and Distribution (SD) application. Additionally, it transfers the costs from cost centres, orders and projects, as well as costs and revenues from direct postings or settle costs from CO to profitability segments. And, an interface program is available to transfer external data to the R/3 System.
Incoming sales orders or billing documents can be valuated automatically to determine expected sales deductions or costs.
Information System: -
Information System allows to analyse existing profitability data using drilldown reporting tool. The Information System analyse the existing data from a profitability standpoint using the drill down reporting tool functions.
Navigation through a multidimensional data cube using drill down or switching hierarchies can be performed. The system displays data in accounts/value fields depending on the current active type of Profitability Analysis and the type to the report structure is assigned.
Therefore, planning can be done either in accounts (account-based CO-PA) or in value fields (costing-based CO-PA). The display parameters can be changed online directly from the displayed report.
Report structures, number formats etc can be stored and executed online or in the background at any time.
This allows to plan sales, revenue and profitability data for any selected profitability segments. There is no common source of planning data and both types of Profitability Analysis can receive actual data in parallel.
Therefore, planning can be done either in accounts (account-based CO-PA) or in value fields (costing-based CO-PA).
The manual planning function allows to define planning screens for the organization. Using the same, it can display reference data in planning, calculate formulas, create forecasts, and more. Planning can be performed at any level of detail.
In automatic planning, you can copy and revaluate the actual or planning data for many profitability segments at once. To create production plan, planned sales quantities can be transferred from costing-based to Sales and Operations Planning.