207669744-FI-Integration.ppt207669744-FI-Integration.ppt

Gerald B. Steele
Principal Consultant, SAP America, Inc.
Financial
Integration in PPM

Introduction to Financial Integration
Where is the Financial Data-Overview
Project Systems ECC 6.0
cProjects 4.0
xRPM 4.0
Questions & Limitations
Financial
Integration in PPM

 SAP AG 2006, Title of Presentation / Speaker Name / 3
Business Case #1 – PS
Business case description – A mid-market Pharmaceutical company
decides they need a better integrated tool to manage their R&D
projects.
Their requirements included:
 Resource planning along a discrete curve over a long period of time.
 Detailed cost planning for external partners with procurement process.
This includes multi-country/multi-currency highly regulated procurement
and invoice postings.
 Use of settlement to move costs to multiple receivers based on type fo
costs.
– G/L for R&D costs, CCtr for clinical trials costs, PCA for other costs.
 Extensive use of Graphics to build and manage project structures.
 Use of CATS to enter time against projects for every employee in the R&D
organization.
In this case, PS was a better fit as it best met the demands of the
customer to integrate HR, FI/CO, MM, and PCA.

Business Case #1 – PS
Chose to use Integrated Planning on WBS elements due to requirement
to discretely plan resource across extensive duration. They also chose
to use the Project Planning Board to manage ALL aspects of their
Project Structure Planning and utilize WBS Cost planning to manage
their resource planning against cost centers.
Summary:
This Pharma customer is live with PS and most of the ERP modules for
their R&D organization.
 This Pharma customer implemented PS for the purpose of integrating their
financial and procurement tools with their project management tool.
 They utilize integrated planning with CO to get a better view of their required
resource load over time across projects.

Business Case #2 – xRPM
Business case description – Customer uses PS in their R&D
organization and MS Project in their IT organization. They do not have
a solution to manage ANY portfolio data.
They have the need to view and manage their IT portfolio across their
enterprise. Because they currently use MS Project for IT projects and
will want to manage their entire project portfolio, we proposed using
xRPM.
Questions regarding this decision surrounded the long-term vision of
portfolio management. Data origin (where the data comes from:
 Project structures (MS Project, Artemis, Plan View, Primavera, etc…)
 Resources (MS Project, PeopleSoft/Oracle, SAP, etc…)
 Costs (MS Project, Primavera, Oracle, SAP, etc…)
The use of xRPM allows this customer to continue using their existing
project management tools while providing the capability to add
additional tools to manage the enterprise portfolio as they determine
their portfolio design.

Introduction to Project Financial Integration
A key differentiator in the SAP tools for Project & Portfolio
Management (PPM) is the integration into the back-end Financial
and Controlling systems.
This functionality eliminates the need to enter data into multiple
systems and therefore maintains the “official” system of record.
All of the PPM tools SAP offers have this functionality.
The SAP Portfolio tool, xRPM, also provides connectivity from other
back-end Financial Management, Human Resources, and Project
Management tools to provide greater flexibility across the
Enterprise portfolio.

Where is the Financial Data
In the world of PPM tools such as Project Systems (PS) in ECC,
cProjects 4.0, or xRPM, neither costs nor revenues originate via
direct transactions. As such, costs are “moved” into the PPM tools
PS, cProjects, and xRPM from other parts of the system such as
Purchasing, Goods Movements, Sales Document Billings, Labor
Confirmations, etc.
The following slide demonstrates how labor costs are generated
and “stored” in the Organizational Breakdown Structure (OBS) and
then moved to the project (PS) via labor confirmations and later off
the project via settlement.
Direct posting to the project occurs when goods receipt from a PO
is executed, an invoice is posted, or a goods issue occurs.
Revenue is posted to a project via a customer invoice (billing)
posting.

Cost Center
OBS
Work Centers
Dollars
Activity Types/
Rates
$75/hr
$50/hr
$25/hr
Project
1.1 1.2 1.3
0010
0040
0030
0050
0020
0060
Cost Center
Engineering
Craft
Design
10 hrs 100 hrs
20 hrs
5 hrs
1,250
2,500
750
Engineering
1.1
1.2
0020
Design 750
Engineering 250
Craft
0040
2,500
1,000
Airplane
$4,500
Project
$4,500
Asset
Settlement
25 hrs
10 hrs
blue = actual hrs Consumed
red = planned hrs
Where is the Financial Data

Cost Planning in Projects
Overall planning
(hierarchical planning)
Cost planning using
activities/
network costing
E 10h service 1421
E 10h service 1421
F 10h vendor 1000
F 10h vendor 1000
K $5000 ce 466000
K $5000 ce 466000
Cost element planning
400000 150000
415000 75000
400000 180000
415000 80000
600.000
400.000 200.000
Unit Costing
S
S
1 1
Easy Cost Planning
I/0099
Projects and Orders
PP CO
PM/CS

Network Cost Planning
P
P
P
0010 (E), 80h, Wctr 2000, AT 1421
0020 (F), 10h, PurcInfo 550000017
0020 (F), 10h, PurcInfo 550000017
0030 (K), CE 466000, $5000
0030 (K), CE 466000, $5000
P-1
P
P -
- 1
1
0040 (E), 80h, Wctr 2100, AT 1420
0040 (E), 80h, Wctr 2100, AT 1420
0050 (K), CE 400000, $5000
0050 (K), CE 400000, $5000
0060 (K), CE 417000, $2000
0060 (K), CE 417000, $2000
P-2
P
P -
- 2
2
Planned costs
Periods
1 2 3 4 5 6 7 8 9 10 11
Shifting a work
package 
Shifting cost
planning automatically
Shifting a work
package 
Shifting cost
planning automatically
P
P
P
P-1
P-1
0010
0010
0020
0020
0030
0030
P-2
P-2
0040
0040
0050
0050
0060
0060
Project Cost Planning Using Activities
1
1

PS Financial Planning Questions
Do you need multiple CO plans?
Do you need varying levels (detailed vs. “lump-sum”) of cost planning?
Do you need cash flow planning?
Do you need budgets and/or availability control?
Do you need integrated planning? (PS & CCtr planning)
Do you need more than labor cost planning?
Do you need overhead costing sheets?

Actual Costs on Projects
Y
X
Availability
control
Costs,
Revenues
Dates
Integration
AM
AM
FI
FI
CO
CO
SD
PM
MM
PP
Payment
data
Resources
HR
PS
PS

PS Financial Posting Questions
Do you need Accrual (FI) postings?
Do you need Settlement?
Do you need Internal Order integration for FI/CO control?
Do you need statistical projects?
Do you need Earned Value/Progress Analysis?

Direct Procurement – Procured Material Costs on Project
Materials
Materials
Materials
“N”
Material procured directly by means of
an activity.
Purchase
requisition
Request for
quotation
Quotation
entry
Vendor
selection
Purch. order
processing
Purchase
monitoring
Invoice
verification
Item category
"N"
Goods
receipt
Actual
costs
Purch. req.
commt for
activity
Purch. req.
commt for
activity

PS Procurement
Do you need direct Procurement?
– Purchase requisition, purchase order, PCard…
Do you need material planning?
Do you need procurement commitment tracking?
Do you need Project Stock?
Do you need GR/IR tracking?

Stock or Make-To-Order (MTO) Procurement
Procurement Steps
Goods issue
Production order
Vendor
1000 Purchase
components
Goods receipt
for purch . order
Production
T - 20620
T - 20620
Production
order
T - 20600
Production
order
T - 20600
4100
4100
4100
T - 20600
T
T -
- 20600
20600
T - 100##.4
T
T -
- 100##.4
100##.4
T - 20610
T - 20610 T - 20630
T - 20630
Goods issue
Network activity
(consumption)
Delivery
Production order
T - 100##
T
T -
- 100##
100##

PS Using Production
Do you need production integration?
Do you need to track production costs and WIP in your project?
Do you need ETO/MTO BOM integration with inventory and cost
management?
Do you need Variant Configuration?

Revenue Planning in Projects
Revenues
Revenues
Time
Time
01 02 03 04 05 06
Sales order without
billing plan
Sales order without
billing plan
Billing
plan
B
B
B
B
Billing
plan
B
B
E
E -
- 1399
1399
E
E -
- 1399
1399 -
-1
1
E
E -
- 1399
1399 -
- 1
1-
-1
1
E
E -
- 1399
1399 -
- 1
1-
-2
2
E
E -
- 1399
1399 -
-2
2
.
.
.
.
P
L
N
D
T
O
T
A
L
S
D
D
O
C
M
T
D
I
S
T
R
B
T
Total
Total
...
...
...
...
Manual revenue planning
Manual revenue planning
B
B
Billing
plan
Sales order with
billing plan
Sales order with
billing plan
Billing plan in
WBS element
Billing plan in
WBS element
2000
2000
2001
2001

PS Revenue Integration
Do you need revenue planning?
 Manual or automated from Sales Order?
Do you need Results Analysis?
Do you need Profitability Analysis & reporting?
Do you need Billing?
 Resource Related Billing (RRB), Lump Sum, Fixed Price, Progress
Payments/Down Payments, Milestone Billing, etc

cProjects: Project Accounting
 Project cost controlling using
integration to mySAP ERP
Financials and Project System (PS)
 Multilevel controlling: cProjects
structures can be replicated into
PS structures
 Costs can be settled on internal
orders or WBS elements
 Calculation of project costs based
on role demand (plus integration with
Easy Cost Planning in mySAP ERP)

Task:
 Link project structure
to accounting
structure
Solution:
 cProjects 4.0
Benefits:
 Use SAP Project
System for Planned
and Actual Costs
Set up Accounting
Project Manager

cProjects 4.0: Multilevel Controlling
 Set-up project plan
 Execution in time, in
scope (and in budget!)
 Plan costs and budget
 Monitor execution
Project lead
Project
controller

Multilevel Controlling 1/2
Functionality
 You can flexibly assign WBS Elements as cost collectors to project tasks.
 It is also possible to assign multiple Internal Orders.
Different controlling scenarios are available
 Assignment objects
– WBS Elements
– Internal Orders
 Assignment types
– Manual assignments
– Automatic assignments to WBS Elements
 Assignment rules
– Role based
– Task based
 Enhancements
– Customer-specific scenarios can be executed using the BAdI
“IAOM_DET_CO_SCENARIO”

Multilevel Controlling 2/2
Enables bottom-up planning and top-down budgeting, billing and
results analysis (RA) aggregating values and quantities in the
hierarchy
Calculation services to create cost estimates based on the assigned
cProjects structure while costs (actual/planned) are stored on the
WBS elements.
Settlement of costs originating from various sources:
 Actual costs derived from recorded and confirmed time on cProjects tasks
using CATS.
 Costs derived from procurement or goods movements
 Costs derived from project-related travel.

cProjects 4.0: Multilevel Accounting
Assignment of work breakdown structures (WBS)
cProjects
Structure
PS Structure

Assignment in PS data
A new tab “cProjects” in the WBS elements
sight is coming with ECC 6.0 (ERP 2005)
The assigned cProjects item is shown here.

Time and Expense Recording on cProject-elements
SAP ECC
Controlling
Object (PS/IO)
Billing
Contract
T&E
Pre-Billing
cProject
SAP ECC
Controlling
Object (PS/IO)
Billing
Contract
T&E
Pre-Billing
cProject
Current Integration New Integration Option
 T&E on Controlling Object
 Manual Update of confirmed
days in cProject-tasks
 T&E on cProject-task / role from
worklist
 Confirmed hours / days
automatically updated in
cProject-task
 Costs updated on CO-Object
=> Less process steps and
one world for project team

Task:
 Plan Financial Data
 Plan Capacities
Solution:
 xRPM 4.0
Benefits:
 Compare forecasted,
planned and actual
data
Plan Financial Data
Product
Manager

xRPM FI Integration
Does financial data come from various systems?
 SAP and/or others
Does project data come from various systems?
 SAP and/or others
Do you need to report on projects that are not yet projects?
 Concepts that do not exist in the tactical project management tool

Introduction to Financial Integration
Where is the Financial Data-Overview
Project Systems ECC 6.0
cProjects 4.0
xRPM 4.0
Questions and Limitations
Financial
Integration in PPM

Limitations
Budget control data in PS
 Does not get passed on to cProjects
CO Plan version data
 Only plan version “0” will get passed in to cProjects or xRPM
 cProjects and xRPM do not support multiple CO plan versions
Portfolio project plans
 You cannot push project plans from xRPM down to PS or cProjects
CATS and cProjects
 While it is true that you can post time to cProjects using CATS, you can
only post time against one project per timesheet
Effort required to upload data to xRPM
 This effort requires a significant amount of time to execute the extensive
number (6-7 programs) of programs required to move data from
cProjects/PS into xRPM

Questions

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