Performing Overhead Calculations

Another technique to apply overheads is to use an overhead costing sheet. You can use the overhead costing sheet to allocate overhead costs to activities and WBS elements.

You can use this function to calculate overheads in planned, commitment, and actual values.

The costing sheet determines the overheads that are calculated and the objects (cost center, internal order, or process) to which overheads are credited.

Using this technique, the costing sheet determines the amount of overhead that needs to be allocated.

The overhead surcharge can be driven by either value or quantity. You can define a surcharge percentage if the surcharge is value-driven. You can define an absolute value per unit of measure if it is quantity-driven (for example, 100 surcharge per hour to utilize a machine).

You calculate the overhead against a base, which represents the expenses that drive the allocation of the surcharge. The base is defined by cost elements and can be either the total value of the base or only the fixed or variable portion.

The following list highlights the costing process:

1. Collect cost elements or cost element areas in baselines.

   Example: B100 – cost elements 54000000 to 54500000all costs for consuming materials.

2. Define the surcharge, which is calculated against the base.

3. Calculate an overhead for one or more baselines.

   Example: C000 – 20% warehouse surcharge for all stock-purchased materials used.

4. Each overhead allocation leads to a credit posting to a cost center, internal order, or process, and is posted using an overhead cost element defined in the credit key.

   Example: E01 – post the credit to cost center OVH_MAT_CR, using cost element 94111000.

The overhead rate that is applied can depend on various factors, such as the time period, controlling area, company code, plant, network type, plan versus actual, and overhead group. The overhead group is determined in Customizing from the overhead key assigned to the cost object, which enables the use of a single costing sheet with flexible rates based on organizational units or individual activities.

In the case of networks, the costing sheet is derived from the Parameters for Network Type table by means of the costing variant. You can change the costing sheet and overhead key in the network header. Both features provide a default for the costing sheet assigned to activities.

The costing sheet for WBS elements is derived directly from the project profile.

If you create activities for the WBS, the newly created activities inherit their costing sheets and overhead keys from the WBS elements.

In the case of Easy Cost Planning and unit costing for WBS elements, cost planning draws on a costing sheet for a costing variant that is assigned to the project profile by way of the planning profile. This method is available only for cost planning using unit costing or Easy Cost Planning, and is not shown in the Tables for Process Costs and Overheads figure.

The template is dynamically determined during cost planning and period-end allocations, based on the costing sheet and overhead key assigned to the cost object.

With the introduction of SAP HANA as a new, in-memory database, new reporting and calculation options became available that can be used in the Project System. You can now use the accelerated selection of the hybrid database (HDB) (like in SAP HANA) to calculate the overhead rates.

The accelerated selection of the new transactions uses the column storage of the SAP HANA database in such a way that only certain columns of data are read from the data and used. For example, if you do not have the cost element in your layout, then the cost element is not imported and all line items are summarized. In general, all fields that are not selected are summarized.

The accelerated selection reads the overhead rates that were previously posted in the current period directly from the line item tables instead of reconstructing them from the total records read.

The accelerated selection for the overhead calculation is not possible if there is no update at line item level (for example, if the Write Plain Line Items business transaction is not allowed) or for a material cost estimate (transaction codes CK11 and CK11N).

Prerequisites for this enhancement are that the HDB and tables (COEP, COEJ) are available according to Customizing (transaction code HDBC). Also, the replication (SAP Landscape Transformation, or SLT) must be guaranteed in a time frame before the repeated overhead calculation of the same object. The overhead rate is updated in the standard database; for a new application of overhead, records that were previously posted are read from the HDB.

Value transfer distinguishes between two types of values:

• You can transfer values derived using the project quantity structure (billing plan) or network quantity structure (activities, components including invoicing plans, and so on) to the version and, in the case of simulation, back to the operative project.

• You can copy values planned manually and actual values that are copied from the operative project to the version and evaluate them in the project information system. They cannot be copied to the operative project.

Planned order costs, including network costs, always update CO plan version 000. When you recalculate the planned costs of activities, the previous results are overwritten.

For historical analysis, you may want to copy the results of version 000 to another controlling plan version. You can copy planning from version 000 to other versions and analyze the various versions in the information system.

When you create a controlling area, the system automatically creates a plan version (000) for planned/actual values. Actual values are posted in this version.

To transfer planned values to Cost Center Accounting, you must turn on integrated planning for orders/projects for the planning versions.

Activity inputs planned in a plan-integrated order/project are updated directly in the sending cost center if you activate Integrated planning with Cost Center Accounting in the version. You can then also settle plan-integrated orders/projects to cost centers.

Plan data is passed on to the profit center and extended general ledger if you activate both the Integrated Planning with Cost Center Accounting and Integrated Planning indicators in the version.

Networks always write plan costs to CO versions, but do not write any plan line items and are not integrated in planning. Since changes are frequently made to networks, there would be too many plan line items. Therefore, for performance reasons, the writing of plan line items is not supported. To allow integrated planning, the Integration of networks in planning function was developed in SAP ERP.

The WBS elements assigned to network activities must be able to write plan line items. You can achieve this by selecting the indicator for integrated planning for these WBS elements. You can also achieve this by explicitly allowing the Write Plan Line Items business process in the user status. You can select the indicator as a default setting in the project profile in Customizing.

For orders, you can store a default value in the order type, which you can change in the order master data when required.

You can change the Integrated planning indicator at a later date if unit costing was never performed on the job affected. That is, if no unit costing was performed, even if it was later undone.

As of SAP ERP 4.70, you can include network planned costs in your integrated planning. The program transfers the planned costs of the following objects to the assigned WBS element:

• Header-assigned networks

• Internally processed activities and elements

• Externally processed activities and elements

• Service activities and elements

• General costs, activities and elements

The planned costs for the network, network activity, or network activity element are converted to cost element planning/activity input planning for the assigned WBS element. Selection of the planned costs occurs in relation to the fiscal year (period-specific). Values that already exist (for example, manually planned values for WBS elements) are overwritten in the target version. The system ignores objects with deletion indicators.

You can process integrated planning for networks in collective processing (CJ9Q) or in individual processing (CJ9QS).

Due to the attributes of project planning, selection of the planned costs is performed in relation to the fiscal year (period-specific). The target version must differ from the source version because the costs are otherwise duplicated. Existing values are overwritten. In other words, manually planned values to WBS elements are deleted in the target version. Objects marked for deletion are ignored.

The following figure shows integrated planning for network results.