Integrating SAP Portfolio Management with SAP ERP Financial Data

IT projects and service projects are often planned and implemented using Project Management. In PPM, appropriate portfolio items are then created, which are linked with the portfolio projects, and are used for a first rough planning of the required funds.

For a detailed cost planning and for the posting of actual costs, the portfolio projects are linked with work breakdown structures from PS or, in the simplest case with internal orders from SAP Controlling. Depending on the setting of portfolio projects, these links to controlling objects are done automatically or manually.

On the basis of the link, plan data of the portfolio projects, such as planned required capacities and costs or revenue rates is passed on to the linked controlling objects and used here for automatic cost and revenue planning. The plan data can now be supplemented at the level of controlling objects and budgeting can be performed.

After the release of project parts in the implementation phase of the projects, the resources of the project can have automatic data, such as assigned tasks, implemented in the worklist of the time sheets Cross-Application Time Sheet (CATS). The resources can then use this information to confirm the work they have performed. The actual times that are confirmed in this manner can be passed back to the portfolio projects, and the actual costs are posted to the linked controlling objects. If other costs arise in the project execution due to external procurements, period-end closing activities, or revenues due to invoicing and customer invoices, then these are also posted to the Controlling objects.

Using the FI/CO interface of PPM, you can now integrate all this accounting data of the linked controlling objects into the financial planning of the relevant portfolio items. This data can be compared with the financial planing data that was originally forecasted, and can be used to monitor projects continuously.

Using the financial planning in PPM, you forecast financial data for portfolio items and portfolio buckets in a very early phase of your projects. If detailed plan data is available later due to your project planning, it should also be possible to evaluate this data in the financial planning of PPM and base decisions on it. You also require data about the actual costs incurred or commitments for monitoring and controlling in PPM, particularly in the implementation phase of the projects. To be able to evaluate detailed accounting data from FI/CO in PPM, use the FI/CO interface of PPM.

Data Integrated Using the FI/CO Interface of the PPM Interface

• Planned costs
• Planned times
• Planned revenues
• Budget
• Commitments
• Actual costs
• Actual times
• Actual revenues

Object Link of the Controlling Objects

The integration of accounting data is technically implemented using object links, similar to the integration of the project management data. This means that an object link is established between a portfolio item and a controlling object, which is then used to exchange accounting data. You can create this link using Object Links, which you navigate to through Relationships → Object Links from a portfolio item. You can select the object type and the controlling object and assign it to the portfolio item.

You can create object links to the following elements:

• Internal orders
• Network activity element
• Network
• Network activity
• Network hierarchy
• Network activity hierarchy
• Project definition
• Service or maintenance order
• WBS element hierarchy
• WBS element

If a suitable object link exists between the portfolio item and the controlling object, the uploading of data is controlled by a program that is usually scheduled as a background job in the PPM core system. The preceding figure illustrates how this program works.

This scenario involves the monitoring and controlling of large projects, such as construction projects, maintenance projects, or large research and development projects. In an early phase, portfolio items are created, critical success factors are determined and rough planning of required funds is performed in PPM.

The projects are usually mapped in PS, since integration to Materials Management (MM), Production Planning (PP), Plant Maintenance (PM), Sales and Distribution (SD), Investment Management (IM) and Financial Accounting and Management Accounting (FI and CO) is generally required for detailed planning and execution. You can use the PS integration to evaluate structure data, scheduling data, or resource data of these projects directly in PPM.

In doing so, data from the projects in PS is converted to Project Management data and uploaded to PPM. This integration is independent of the FI/CO integration.

Customers, who are interested only in the accounting data of the projects, can use the FI/CO integration without having to upload structure data, scheduling data, or resource data to PPM.

The projects in PS are used for cost planning, revenue planning, and budgeting. In particular, documents from various other applications result in commitment, actual costs, and actual revenues. Using the FI/CO interface, this data can be passed on to the portfolio items to which the projects were assigned and compared here with the original financial planning.

In PPM, you can specify a financial planning currency for items, buckets and initiatives. Valid currencies are predefined in Customizing. During financial planning, you can switch between different currencies so that a currency conversion can take place. Conversion rates are maintained in a separate SAP ERP system.

Whether a currency conversion takes place or not depends on the following conditions:

• Has the value been transferred from SAP ERP?
• Is the value available in the requested currency? (controlling area currency or item currency are saved for items)

If both the answers are yes, the values are taken from SAP ERP. If one of the answers is no, currency conversion takes place.