COGS and Revenue Postings for PCS Projects in a Multicompany Environment

If you work on a PCS project in a multicompany environment where sales offices, service departments, and warehouses belong to different financial companies, you can choose where financial transactions for PCS related COGS and revenues must be posted:

  • On the financial company of sales office, service department, and/or warehouse
    You can choose to use the PCS project to monitor costs and for tracking purposes, while PCS related COGS and revenues are posted on the financial companies of the service department, sales office and/or warehouse. You must then clear the COGS and Revenues restricted to Financial Company of PCS Project check box in the Project Control Parameters (tipcs0100m000) session.
  • On the financial company of the PCS project
    You can choose to post all PCS related COGS and revenues on the financial company of the PCS project's calculation office. As a result, the financial departments of sales orders, service orders, and warehouse orders must be in the same financial company as the PCS calculation office. You must select the COGS and Revenues restricted to Financial Company of PCS Project check box in the Project Control Parameters (tipcs0100m000) session if you want to post PCS related COGS and revenues on the financial company of the PCS project's calculation office.

If PCS related COGS and revenues are posted on the sales office, service department, or warehouse instead of on the PCS project's calculation office, which means that the COGS and Revenues restricted to Financial Company of PCS Project check box in the Project Control Parameters (tipcs0100m000) session is cleared, you must allow for the following:

  • COGS distribution

    The general COGS is distributed among several departments instead of only on the PCS project's calculation office. You must use the COGS Distribution based on field in the Project Control Parameters (tipcs0100m000) session to choose whether you want to enter the COGS distribution manually, or that LN calculates the COGS distribution based on the revenue of the sales order, service order, and/or warehouse order. Use the Project COGS Distribution (tipcs3110m000) session to view and maintain the COGS distribution.

    Note: The general PCS results are always posted on the PCS calculation office, because they are assumed to be always related to the PCS calculation office.

  • Revenue recognition

    If you calculate interim COGS and revenues for a PCS project, and the PCS project has sales orders, service orders, and warehouse orders linked to several financial companies, the calculated COGS and revenues are distributed among various departments. You can view the distributed COGS and revenues by department in the COGS and Revenues by Project and Order (tipcs3192m000) session.

    Note: If COGS and revenues for a PCS project are restricted to the financial company of the PCS project, which means that the COGS and Revenues restricted to Financial Company of PCS Project check box in the Project Control Parameters (tipcs0100m000) session is selected, the interim COGS and revenues are posted to the PCS calculation office. The 'real' COGS and revenues, however, are posted to sales offices, service departments, and warehouses.

  • Internal invoices

    If financial transactions are posted on the financial company of a sales office, service department, and/or warehouse, you can also send an additional invoice for general COGS from the PCS project to the sales office, service department, or warehouse. For this purpose, you must define an intercompany trade relationship between the PCS project and the sales office, service department, or warehouse in the Intercompany Trade Relationships 360 (tcitr2300m000) session.

    In Invoicing (SLI) and Accounts Payable (ACP), the general COGS on the internal invoice is indicated by a cost item. You must define a default cost item in the Project Control Parameters (tipcs0100m000) session. Furthermore, PCS project order number is specified on the internal invoice, which is generated based on the number group and series that are defined in the Project Control Parameters (tipcs0100m000) on the Settings for COGS tab.

    Note: Internal invoices are optional. You can have financial transactions posted to the correct financial company without internal invoice.

Related topics