Thursday, October 6, 2011

Distribution, Periodic Reposting and Assessment

Distribution

The following information is passed on to the receivers:

The original, primary, cost element is retained.
Sender and receiver information is documented with line items in the CO document

 Assessment

The following information is passed on to the receivers:

The original cost elements are grouped together into assessment cost elements (secondary cost elements).
The original cost elements are not displayed on the receivers.
Sender and receiver information is displayed in the CO document


CO allocations work in the same manner but there are differences regarding
which type of sender is accepted and the way postings are done.

The following should be considered when selecting the method to apply:

1. Senders

Distribution and Assessment will only accept Cost Centers as senders whilst
Reposting will accept all CO objects

2. Posting Method

Distribution and Reposting will only post primary cost elements whilst Assessment will allow posting of both primary and secondary cost elements.

Also Distribution and Reposting will show the costs in the receiver under the original cost element whilst Assessment will use an assessment cost element.

DISTRIBUTION CONTAIN PRIMARY COST AND IN ASSESSMENT THE
SECONDARY COST ELEMENT CARRY THE PRIMARY COST

In Distribution we can distribute only Primary cost but in Assessment both primary as well as secondary cost can be allocate
Performance wise assessment is better since detail line items not written.
Detail drill down is possible in distribution only in assessment only unclean DR and CR written


DISTRIBUTION
Distribution was created for transfer primary costs from a sender cost center to receiving controlling objects. During distribution, only cost centers or business process can be used as sender.

A distribution receiver can be a cost center, WBS element, internal order, cost object, or a business process.  You can restrict the number of receiver categories in customizing.

Primary Postings (such as, energy costs) are collected on a cost center, and allocated at the end of the period by means of the user-defined key.

You can only distribute primary costs.  During this process, the original cost element remains the same.

Line items are posted for the sender as well as for the receiver, enabling the allocation to be recorded exactly.

You can reverse distributions as often as required.

You use the Cycle-Segment method to define sender-receiver relationships.
PERIODIC REPOSTING
Differences between periodic reposting and distribution are due to information content and performance.
For periodic reposting, no separate credit record is written on the sender for the cost element in the summary report.  Instead, the totals record for the cost element is reduced on the debit side, which means that the original debit amount can no longer be checked there ("unclean credit").
However, during distribution, the system writes a totals record for the credit ("clean credit"). The information on the receiver is the same for periodic reposting and distribution ("clean debit").

Compared with periodic reposting, during distribution, the system also updates the partner in the totals record for the sender. This means that the partner can be displayed in the information system on the totals record level.

As fewer totals records are written during periodic reposting, performance is better than during distribution.  

ASSESSMENT

Assessment was created to transfer primary and secondary costs from a sender cost center to receiving controlling objects.
During assessment, cost center or business processes can be used as senders.

The receivers for an assessment can be a cost center, WBS element, internal order, cost object, or a business process. You can restrict the number of receiver categories in customizing.

Primary and secondary posting are allocated at the end of the period by the user-defined key.

During assessment, the original cost elements are summarized into assessment cost elements (secondary cost element category = 42). As the system writes fewer total records, the assessment has a better performance than periodic reposting and distribution.

The system does not display the original cost elements in the receivers.  Therefore, assessment is useful if the cost drilldown for the receiver is not important.

 Similar to distribution, the partner is updated in the totals record during distribution
 You can reverse assessments as often as required. You use the Cycle-Segment method to define sender-receiver relationships.

A: Its easiest to demonstrate this by way of an example

 Lets say we have three cost elements with the following amounts to be allocated:
 A Electricity $2000 B Water $3000 C Canteen Costs $4000

With assessment cycles the system groups all three together and summarizes the balance of 9000$ onto a separate cost element e.g. D.In order to allocate the costs to a receiving cost centre. Hence your sender cost element is D in your CO reporting and not A,B,C With distributions the costs are allocated from the original cost elements. Hence your senders are A,B,C

1 comment:

  1. Explained very well.
    I have a doubt here. Why we can't use secondary cost in distribution?

    ReplyDelete