Describing the Process Steps in Project System 711. Creating a Project Structure 713 Exercise 66: Create a Project Structure 721

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1 UNIT 11 Project System Lesson 1 Describing the Process Steps in Project System 711 Lesson 2 Creating a Project Structure 713 Exercise 66: Create a Project Structure 721 Lesson 3 Planning a Project 725 Exercise 67: Plan Resources in a Project 729 Exercise 68: Plan Dates in a Project 737 Exercise 69: Plan Costs in a Project 743 Lesson 4 Budgeting in a Project 749 Exercise 70: Create the Budget for a Project 753 Lesson 5 Executing a Project 756 Exercise 71: Release a Project 759 Exercise 72: Post a Confirmation of Time for your Project 767 Exercise 73: Post Time Confirmation with CATS 771 Lesson 6 Processing Period-End Closing Activities 778 UNIT OBJECTIVES Describe the process steps in project system Copyright. All rights reserved. 709

2 Unit 11: Project System Create a project structure Plan Resources in a project Plan dates in a project Plan costs in a project Create the budget for a project Execute a project Record labor for a project Post materials for project Process period-end closing activities 710 Copyright. All rights reserved.

3 Unit 11 Lesson Describing the Process Steps in Project System LESSON OBJECTIVES After completing this lesson, you will be able to: Describe the process steps in project system Process Steps in a Project System Figure 322: Project Characteristics Projects are tasks that have the following characteristics: Projects are usually complex and unique and involve a high degree of risk. Projects have precise targets that are agreed on between the contractor and the sold-to party. Projects are limited in duration and are cost and capacity intensive. Projects involve several departments. Projects are subject to specific quality requirements. Copyright. All rights reserved. 711

4 Unit 11: Project System Projects are of strategic significance for the business carrying them out. Projects are an integral part of the commercial processes of a business. Before you can control all the tasks that occur as part of project execution, you need a project-specific organizational form that should be in a position central to the user departments involved. Project structure has no organizational structure of its own. You need to incorporate it into the existing structure by making assignments to the organizational units in accounting and logistics, thereby enabling the project structure to present data in clear and differentiated ways. A project is assigned to only one controlling area, but each element of the Work Breakdown Structure (WBS) can be assigned to different company codes. Phases in a Project Figure 323: Phases in a Project A project comprises several phases. Planning and coordinating large and complex projects require a high degree of precision. When planning the flow of a project, you can schedule deadlines and dates, make resources available, and assign budgets. The project structure provides the support you need during all project phases. LESSON SUMMARY You should now be able to: Describe the process steps in project system 712 Copyright. All rights reserved.

5 Unit 11 Lesson Creating a Project Structure LESSON OBJECTIVES After completing this lesson, you will be able to: Create a project structure Project Structure Figure 324: Project System Master Data A Work Breakdown Structure (WBS) is a model of a project and shows the required project activities in a hierarchical form. It forms the control basis for planning costs, revenues, payments, scheduling, and budgeting. Activities show the flow of a project as well as the specific tasks involved in a project. Individual tasks are linked to each other by relationships and can be further grouped together to form networks. Activities form the operative basis for planning and controlling dates, costs, and resources (personnel, machinery, production resources, and tools (PRTs), and materials). When activities are assigned to WBS elements, the dates and costs defined in the individual activities are aggregated at the WBS level and can be evaluated. Activity funds already assigned are checked against the budgets of the WBS elements. Copyright. All rights reserved. 713

6 Unit 11: Project System Work Breakdown Structure (WBS) Figure 325: WBS Functions The WBS is the functional basis for the detailed planning of steps involved in controlling a project, for example, for process planning, cost planning, scheduling, and costing. The WBS gives a clear picture of the project and facilitates the coordination and implementation of the project from a management standpoint. The WBS shows the work involved in a project. The WBS forms the basis for all subsequent planning tasks in the project. Emphasis is placed on planning, analysis, description, control, monitoring of costs, basic dates, and the budget. Costs, dates, resources, and payments are planned using the activities extrapolated to specific WBS elements. 714 Copyright. All rights reserved.

7 Lesson: Creating a Project Structure Project Builder Figure 326: Project Builder The Project Builder is a user-friendly method of accessing the project structure that enables you to edit your projects quickly and efficiently. The straightforward screen structure of the Project Builder is split into three areas to provide a comfortable working environment. The Project Builder also provides an overview of all the projects that interest you. Contextsensitive menus, drag-and-drop features, and the capability to define your own worklist and template pool facilitate your work with projects. Use the Project Builder or the project planning board to create and change the WBS. You can edit projects in either tabular or graphical mode. Use the Project Builder to maintain any object in the project structure except for the assignment of PRTs. Copyright. All rights reserved. 715

8 Unit 11: Project System Cost Project Operative Indicators Figure 327: Cost Project Operative Indicators You use operative indicators to define the characteristics of a WBS element and to specify which tasks are performed by the WBS element when the project is being executed. The operative indicators to define the characteristics of a WBS element are as follows: WBS elements for which you want to plan costs manually are flagged as planning elements. WBS elements to which you want to post actual costs are flagged as account assignment elements. WBS elements to which you want to post revenues are flagged as billing elements. The Statistic indicator specifies whether a WBS element is used only for statistical purposes or whether it works with real costs. In the example in this figure, you want to carry out planning as far as level 2 in the project hierarchy. WBS elements of level 3 and below are not planning elements. 716 Copyright. All rights reserved.

9 Lesson: Creating a Project Structure Editing the Project Using the Project Builder Figure 328: Editing the Project Using the Project Builder Explain the different methods for creating WBS elements. Use the Project Builder to create or change objects in your project (project definition, WBS elements, activities, activity elements, project structure texts, documents, milestones, and material components). Use detail screens, lists, and graphics (hierarchy graphics and network graphics) for this purpose. In addition to creating project structures manually, you can use any operative project structures (WBSs and networks) and standard structures (standard WBSs and standard networks) as templates. You can also include WBSs, standard WBSs, and standard networks in an existing project structure. When you create projects, you can copy and position both operative projects and standard projects with all the lower-level objects (WBS elements, activities, project structure texts, documents, milestones, and components). Copyright. All rights reserved. 717

10 Unit 11: Project System Networks and Activities Figure 329: Networks and Activities Structures The activities in a project describe the various steps and the work involved in them. In the Project Builder, you can create activities for WBS elements, meaning that the activities are assigned to the WBS elements and that the planned and actual data for the activities (dates, costs, and payment data) can be aggregated at the WBS element level. Activities are linked to each other by means of relationships, and this linking results in a chronological activity sequence. Activities also form the basis for planning the following quantity structures: Dates (occurring automatically through scheduling) Costs (occurring automatically through costing) Resources (including internal activities and external activities) Material requirements (using the assigned components) The PS has the following activity categories: Internal processing for capacities staged in your own company External processing for tasks assigned externally Services for procuring external services Cost activities for planning additional primary costs 718 Copyright. All rights reserved.

11 Lesson: Creating a Project Structure Networks and Activities Functions Figure 330: Networks and Activities Functions Use the activities in the network to plan resources, including labor, capacities, materials, tools, and services that you require for your project. Copyright. All rights reserved. 719

12 Unit 11: Project System PS Texts, Documents, and Milestones Assignments Figure 331: PS Texts, Documents, and Milestones Assignments Project structure texts, documents, and milestones are objects that can be assigned to WBS elements or activities. Project structure texts and documents are used for information purposes and for reporting. Milestones are used for information purposes, but they can also trigger functions in the project (for example, the billing of a sales order or the release of subsequent activities). Project structure texts are user-definable texts that are managed in a project structure text catalog. The texts are classified into different text types. You can assign project structure texts to one or more WBS elements or activities. Enter project structure texts in SAP ERP, SAPscript, or Microsoft Word. The SAP ERP database stores the files in question. Use the SAP Document Management System (SAP DMS) in the project structure to assign document info records to WBS elements and activities. In the DMS, assign original (external) documents in various formats (Microsoft Excel, Word, and PPT, BMP, TIFF, and CAD formats) to an (internal SAP ERP) document info record. In the project information system, you can display the document info records and the corresponding original documents online. You can also display the original documents using the Internet. You can assign milestones to activities and WBS elements. Milestones have a range of applications. They can be used for milestone billing in Sales and Distribution, for example, and to start the automatic workflow of tasks. 720 Copyright. All rights reserved.

13 Unit 11 Exercise Create a Project Structure Business Example You want to redesign your bicycle and develop a new product line. To plan all the activities and track the costs and the dates, you will use a project for development. Because there are no SAP Fiori apps available yet, we will use the back-end system direct. To create your project you will copy a standard project E 0001 including the assigned standard network. Note that, in this exercise, when the values include ##, replace ## with the number your instructor assigned to you. 1. Create the project you using the following data: Field Project Definition Description Start Finish Project Profile Value E 00## Development bicycle TS410-## Today Today + 12 Month ZPSEP01 Std. Project Definition E 0001 Responsible Person ## Planning element Set all Elements to Planning elements Copyright. All rights reserved. 721

14 Unit 11 Solution Create a Project Structure Business Example You want to redesign your bicycle and develop a new product line. To plan all the activities and track the costs and the dates, you will use a project for development. Because there are no SAP Fiori apps available yet, we will use the back-end system direct. To create your project you will copy a standard project E 0001 including the assigned standard network. Note that, in this exercise, when the values include ##, replace ## with the number your instructor assigned to you. 1. Create the project you using the following data: Field Project Definition Description Start Finish Project Profile Value E 00## Development bicycle TS410-## Today Today + 12 Month ZPSEP01 Std. Project Definition E 0001 Responsible Person ## Planning element Set all Elements to Planning elements a) In the Sap Easy Access Menu, choose Logistics Project System Project Project. Alternatively, use transaction code CJ20N. b) On the initial screen of Project Builder, choose Create Copy Project and press Enter. c) On the Create Project, enter the following data: Field Value Project Definition E Copyright. All rights reserved.

15 Lesson: Creating a Project Structure Field Description Start Finish Project Profile Value Development bicycle TS410-## Today Today + 12 Month ZPSEP01 Std. Project Definition E 0001 d) Press Enter. e) Choose the Overview WBS Elements icon. f) Choose the Basic Data tab and select all the elements as PE Planning element. g) Go to the Responsibilities in the WBS element Overview and enter Responsible Person ## as the Responsible Person for all WBS elements. h) Go to the Detail of the Project Definition and enter the Responsible Person ## for the Project Definition. i) Save your project. Copyright. All rights reserved. 723

16 Unit 11: Project System LESSON SUMMARY You should now be able to: Create a project structure 724 Copyright. All rights reserved.

17 Unit 11 Lesson Planning a Project LESSON OBJECTIVES After completing this lesson, you will be able to: Plan Resources in a project Plan dates in a project Plan costs in a project Resource Planning in a Project Figure 332: Aspects of Planning Copyright. All rights reserved. 725

18 Unit 11: Project System The project planning board is a tool that enables you to process the entire project structure, Work Breakdown Structure (WBS) elements, activities, and the objects assigned to the projects in an integrated environment. You can simulate projects at various stages and use this information for the following purposes: To estimate costs, deadlines, and capacities during the quotation phase To compare various options during the course of the project You can then use the best option in your operative project. Project systems allow you to plan in many different ways. You can plan the following facets: Resources Dates Materials Revenue Costs Payments Project structures 726 Copyright. All rights reserved.

19 Lesson: Planning a Project Assigning Human Resources to a Project Figure 333: Assigning Human Resources to a Project Explain resource planning. Resource planning refers to the following points: Internal processes can be planned by means of internal processing activities. You can evaluate capacity requirements for work centers and use the project planning board to level capacities. At the same time, you can also use the project planning board to distribute the work among employees (workforce planning). External services can be planned by means of external processing or service activities. In this case, purchase requisitions are generated in purchasing (at the latest when the activity is released). The purchasing department then procures the services in question externally. You use the activities on a network to plan the resources required for a project. The project structure draws a distinction between the following resources: Internally processed activity Use an internally processed activity to determine the output to be provided by machines or personnel to complete the activity. Evaluate the capacities of the various work centers involved, reschedule these capacities as necessary, and distribute the work among employees. Copyright. All rights reserved. 727

20 Unit 11: Project System Externally processed activity Use an externally processed activity to specify the necessary services to be provided by other companies to complete the activity. Carry out external processing through the purchasing department. Service activities are also used to procure services externally. There is a difference between service activities and externally processed activities. If you use service activities, you can draw up service specifications and set value limits for any unplanned services. The purchasing department carries out service processing (including the entry and acceptance of the services performed). 728 Copyright. All rights reserved.

21 Unit 11 Exercise Plan Resources in a Project Business Example You want to assign your newly hired project engineer to your project. Therefore, you first need to create a new work center that can be used in the network operations. During the creation, you will assign the organizational structure from HCM to the work center. The employee included in the structure can then be used for the assignment in the project. Note that, in this exercise, when the values include ##, replace ## with the number your instructor assigned to you. This exercise requires the Organizational Unit, PRD-##, that you created in the exercise, Create an Organizational Unit and a Position in Organizational Management. Create a Work Center for the Project System 1. Create a new work center for the usage of project system, T-ENG## by copying an existing work center T-ENG00. Copy all relevant data views. Use the following data: Field Value Plant 1010 Work Center T-ENG## Work Center Category 0006 Copy from Plant 1010 Ref. work Center T-ENG00 2. Assign the work center to the organizational unit, PRD-##, that you created in the exercise, Create an Organizational Unit and a Position in Organizational Management. Allocate the Work Center and the Employee to the Network Now that you have created the new work center, you change your project and allocate the work center in your operations. 1. Activate the capacity requirements on the network header and check the capacity availability. 2. Assign the work center T-ENG## to the internal processed operations. 3. For the operations 10 to 40 you assign your personnel number. In operation 50 assign a production work center T-A##. Copyright. All rights reserved. 729

22 Unit 11: Project System Use the following data: Field Work Center (Op ) Work Center (Op. 50) Value T-ENG## T-A## Activity Type (Op. 50) Copyright. All rights reserved.

23 Unit 11 Solution Plan Resources in a Project Business Example You want to assign your newly hired project engineer to your project. Therefore, you first need to create a new work center that can be used in the network operations. During the creation, you will assign the organizational structure from HCM to the work center. The employee included in the structure can then be used for the assignment in the project. Note that, in this exercise, when the values include ##, replace ## with the number your instructor assigned to you. This exercise requires the Organizational Unit, PRD-##, that you created in the exercise, Create an Organizational Unit and a Position in Organizational Management. Create a Work Center for the Project System 1. Create a new work center for the usage of project system, T-ENG## by copying an existing work center T-ENG00. Copy all relevant data views. Use the following data: Field Value Plant 1010 Work Center T-ENG## Work Center Category 0006 Copy from Plant 1010 Ref. work Center T-ENG00 a) In the SAP Easy Access menu, choose Logistics Project System Basic Data Master Data Work Center Master Record. Alternatively, use transaction code CNR1. b) On the initial Actual settlement: Order screen, enter the data provided in the table. c) Press Enter. d) In the Copy from dialog box, select Window mark all the views in the data selection area and press Enter. 2. Assign the work center to the organizational unit, PRD-##, that you created in the exercise, Create an Organizational Unit and a Position in Organizational Management. Copyright. All rights reserved. 731

24 Unit 11: Project System a) On the Create Work Center: Assignment to HR Organizational Entity screen, select Organizational Unit, enter PRD* in the Search Term field and press Enter. b) From the result list, choose your entry PRD-##. c) Return to the Basic Data and change the description to Engineering ##. d) Save the work center. Allocate the Work Center and the Employee to the Network Now that you have created the new work center, you change your project and allocate the work center in your operations. 1. Activate the capacity requirements on the network header and check the capacity availability. a) In the header in the Scheduling tab flag the Capacity Requirements. b) In the menu choose: Edit Availability Capacity. c) In the dialog box that appears, choose Detailed Information and then choose the Adopt icon. 2. Assign the work center T-ENG## to the internal processed operations. a) In the SAP Easy Access menu, choose Logistics Project System Project Project Builder. Alternatively, use transaction code CJ20N. b) On the initial Project Builder screen, select your project E 00## and open it. c) Expand the entire structure and select the network header. 3. For the operations 10 to 40 you assign your personnel number. In operation 50 assign a production work center T-A##. Use the following data: Field Value Work Center (Op ) Work Center (Op. 50) T-ENG## T-A## Activity Type (Op. 50) 11 a) Choose the Operations Overview icon in the Identification and View selection. b) In the Operations 10 to 40, enter your newly created work center.t-eng##. c) In Operation 50, enter the work center T-A## and choose Activity type 11. d) On the left side of the project builder, double-check Operation 10 to select it. e) To add the Person allocated to the work centre, In the Detail section of Operation 10, choose the Person assignment tab f) Select the person by searching in the Person field. There should be only one person available. 732 Copyright. All rights reserved.

25 Lesson: Planning a Project g) Repeat steps d) to f) for Operations 20 to 40. h) Save your project. Copyright. All rights reserved. 733

26 Unit 11: Project System Dates Planning in a Project Figure 334: Basic Dates for WBS Elements Using the project planning board, you can perform certain tasks. For example, you can select WBS elements and schedule the activities assigned to them. The dates of the assigned activities are summarized to determine the scheduled dates of the WBS elements (thin time bars in the project planning board) and can be copied as planned basic dates. The dates scheduled in the WBS can then be extrapolated within the project structure. In Customizing, you can configure the appropriate scheduling parameters or use predefined scheduling scenarios. You can use the project planning board to change these settings for a particular project. You can plan dates for individual WBS elements and also enter outline dates for your project in the project definition. In rough-cut planning, you specify dates for WBS elements that are binding for more detailed planning. You then use this rough-cut plan as the basis for more detailed planning or scheduling using networks. You can use several functions in date planning to compare, reconcile, and calculate dates at a later point in time. 734 Copyright. All rights reserved.

27 Lesson: Planning a Project Scheduling a Project Figure 335: Scheduling a Project In projects with networks, you can carry out scheduling to derive the activity dates and WBS element dates automatically. The scheduling parameters determine how scheduling is carried out. Networks are always scheduled forward and backward. In the scheduling parameters, the scheduling type specifies the direction in which you begin scheduling. The system determines the earliest dates of the activities by using forward scheduling and the latest dates of activities by using backward scheduling. The difference between the earliest and the latest dates of an activity is referred to as a float. A float can be zero or negative. If the float is negative, the activity is critical. Hint: For processing dates that are directly assigned to activities, create time events and assign them to activities. For example, you can create, draft, review, and specify events and assign them to the first activity. You can add dates and texts for these events. The traffic lights indicate whether these events comply with the planned dates. For example, Progress Tracking for Networks is included in SAP ERP 6.0 Enhancement Package 3. Copyright. All rights reserved. 735

28 Unit 11: Project System 736 Copyright. All rights reserved.

29 Unit 11 Exercise Plan Dates in a Project Business Example After you created your project, you want to plan dates on the WBS elements. Due to the assigned network, scheduling is performed automatically by the operations. You want to plan basic dates on the level 2 elements to give a timeframe for the scheduling. Note that, in this exercise, when the values include ##, replace ## with the number your instructor assigned to you. Plan Basic Dates in the Project You want to plan the basic dates in more detail in the project. Therefore you will enter start and end dates for the level 2 WBS elements. Due to the fact that there is no list functionality available in the project builder, you use the planning board for this. 1. Plan the following basic dates for your project, E 00##: WBS element Start Date Finish Date E 00##-1 Today Today + 2 M E 00##-2 Today + 2 M Today + 4 M E 00##-3 Today + 3 M Today + 6 M E 00##-4 Today + 6 M Today + 9 M 2. Extrapolate the dates to the higher level WBS and the project definition. Evaluate the Project from a Technical Perspective 1. Evaluate your project E 00## from a technical perspective using the Structure Overview and the following data: Field Value PS Info Profile Project E 00## Adjust the overview and include the basic start and basic end date in your layout. Copyright. All rights reserved. 737

30 Unit 11 Solution Plan Dates in a Project Business Example After you created your project, you want to plan dates on the WBS elements. Due to the assigned network, scheduling is performed automatically by the operations. You want to plan basic dates on the level 2 elements to give a timeframe for the scheduling. Note that, in this exercise, when the values include ##, replace ## with the number your instructor assigned to you. Plan Basic Dates in the Project You want to plan the basic dates in more detail in the project. Therefore you will enter start and end dates for the level 2 WBS elements. Due to the fact that there is no list functionality available in the project builder, you use the planning board for this. 1. Plan the following basic dates for your project, E 00##: WBS element Start Date Finish Date E 00##-1 Today Today + 2 M E 00##-2 Today + 2 M Today + 4 M E 00##-3 Today + 3 M Today + 6 M E 00##-4 Today + 6 M Today + 9 M a) In the SAP Easy Access menu, choose Logistics Project System Project Project Planning Board Change Project. b) On the Initial screen of Change Project Planning Board, in the Project field, enter E 00##. c) Choose the Open Project icon. d) In the planning board, plan the dates as outline in the table. You can plan the dates by using drag and drop, or double-checking the corresponding WBS element, choosing the Dates tab, and entering Basic Start Date and Basic Fin. Date. e) Stay in the planning board. 2. Extrapolate the dates to the higher level WBS and the project definition. a) Choose the Select All icon to select the WBS elements. b) Choose Edit Reconcile Dates Extrapolate dates. 738 Copyright. All rights reserved.

31 Lesson: Planning a Project c) Save the project. Evaluate the Project from a Technical Perspective 1. Evaluate your project E 00## from a technical perspective using the Structure Overview and the following data: Field Value PS Info Profile Project E 00## Adjust the overview and include the basic start and basic end date in your layout. a) In the SAP Easy Access menu, choose Logistics Project System Information System Structures Structure Overview. When using the structure overview the first time, the system asks for a PS Info Profile. b) In the PS Info Profile field, enter c) Press Enter. d) On the initial screen of Project Info System: Structure, in the Project field, enter E 00##. e) Execute the report (F8). You a see the project in a structural overview. f) Open the field selection. g) Choose the Basic Start and Basic End date. Select them on the right side, take them to the left side, and press Enter. h) Exit the report without saving. Copyright. All rights reserved. 739

32 Unit 11: Project System Cost Planning in a Project Figure 336: Planning Costs and Revenues for a Project Explain the following methods for planning costs: Manual cost planning for Work Breakdown Structure (WBS) elements by using structureoriented planning, cost-element-based detailed planning, or unit costing Automatic cost planning by using the costing data of assigned activities Easy Cost Planning, enabling costs to be planned quickly and easily for WBS elements (If you use Easy Cost Planning to plan costs for WBS elements, you can then use Execution Services to enter the commitment and actual cost data) The types of cost planning in the work breakdown structure (WBS) elements are as follows: Structure-oriented planning In structure-oriented planning, you enter costs for each WBS element and break down your figures by fiscal year. Detailed planning of primary costs and activity inputs Detailed planning of primary costs and activity inputs is cost element based and period based. 740 Copyright. All rights reserved.

33 Lesson: Planning a Project Unit costing Unit costing is cost element based. You use a profile to enter quantities (material, internal activities, external services, variable items, and so on) for each WBS element. Easy Cost Planning Easy Cost Planning offers you an easy-to-use tool for planning costs by cost element in a quantity structure. You then use Execution Services to enter the commitment and actual data for the planned costs. In addition to manual planning in the WBS, you have the option of creating activities for WBS elements and using these activities to plan costs. This method has the following advantages: The resulting plan can be copied to new projects. If parts of the project are shifted, cost planning is shifted automatically with the activities. Planning using network activities is done by cost element and period. Planning Costs and Revenues at the Network Level of a Project Figure 337: Planning Costs and Revenues at the Network Level of a Project When you plan dates and resources in network activities, the system automatically determines the corresponding planned costs as part of network costing. Planned costs are determined for the following objects: Copyright. All rights reserved. 741

34 Unit 11: Project System Activity inputs for internally processed activities (an internal activity) Primary costs for externally processed activities and service activities (an external service) Primary costs for general costs activities Primary costs for material components Activity elements are costed as if they were activities. 742 Copyright. All rights reserved.

35 Unit 11 Exercise Plan Costs in a Project Business Example You have not done the detailed planning of the network, but you want to have cost planning done on a higher level and, in a particular version, to compare the costs later. Note that, in this exercise, when the values include ##, replace ## with the number your instructor assigned to you. Plan Cost Elements in the Project For a preliminary costing and the option of cost comparison you decide to plan cost for the cost center T-ENG00 with activity type ENG-00 on the WBS elements. You want to compare to the costs in the network. This planning is a manual planning on WBS elements. Because you want to compare to the costs later from network you will perform that costing in a different cost planning version. You will use version 1 for the manual planning. 1. For a preliminary costing and the option of cost comparison, plan costs for the cost center T- ENG00 with activity type ENG-00 on the WBS elements. Use the following data for the planning: Field Value Project E 00## Version 1 In the Activity Input planning use the following data: WBS element Cost Center Activity Type Quantity E 00##-1 T-ENG00 ENG E 00##-2 T-ENG00 ENG E 00##-3 T-ENG00 ENG E 00##-4 T-ENG00 ENG Evaluate Costs Cost Comparison Now that you planned your cost manually, you want to compare your planning to the automatic cost planning of the network. Copyright. All rights reserved. 743

36 Unit 11: Project System 1. Compare your planning to the automatic cost planning of the network by running a cost element report. Use the following data: Field Project Controlling Area Value E 00## A000 Plan Version A 0 Plan Version B 1 From fiscal year 1900 To Fiscal year 2017 From Period 1 To Period 12 Use the info profile Write down the planned costs for Version 0 and for Version 1 (the figures can vary, so no solution is provided). Planned Costs Version 0: Planned Costs Version 1: 744 Copyright. All rights reserved.

37 Unit 11 Solution Plan Costs in a Project Business Example You have not done the detailed planning of the network, but you want to have cost planning done on a higher level and, in a particular version, to compare the costs later. Note that, in this exercise, when the values include ##, replace ## with the number your instructor assigned to you. Plan Cost Elements in the Project For a preliminary costing and the option of cost comparison you decide to plan cost for the cost center T-ENG00 with activity type ENG-00 on the WBS elements. You want to compare to the costs in the network. This planning is a manual planning on WBS elements. Because you want to compare to the costs later from network you will perform that costing in a different cost planning version. You will use version 1 for the manual planning. 1. For a preliminary costing and the option of cost comparison, plan costs for the cost center T- ENG00 with activity type ENG-00 on the WBS elements. Use the following data for the planning: Field Value Project E 00## Version 1 In the Activity Input planning use the following data: WBS element Cost Center Activity Type Quantity E 00##-1 T-ENG00 ENG E 00##-2 T-ENG00 ENG E 00##-3 T-ENG00 ENG E 00##-4 T-ENG00 ENG Copyright. All rights reserved. 745

38 Unit 11: Project System a) In the SAP Easy Access Menu, choose Accounting Investment Management Investment Projects Planning Total Costs Change. Alternatively, use transaction code CJ40. b) On the initial screen of Change Cost Planning enter the data provided in the table. c) Press Enter. d) Select the first level 2 WBS element, E 00##-1, and choose the Activity Input icon. e) Enter the following data in the Change Planning Activity Input: Overview Screen: WBS element Cost Center Activity Type Quantity E 00##-1 T-ENG00 ENG f) Go back. g) Confirm the dialog box with Yes. h) Repeat steps d) to g) for the following 3 WBS Elements, E 00##-2 to E 00##-4, using the data provided in the table. i) Select the WBS elements for which you planned the figures and select the Cost Element Plan column. j) From the menu, choose Edit Copy View. k) Confirm the dialog box by pressing Enter. l) Select all WBS Elements and, from the menu, choose Edit Total Up. m) Confirm the dialog box by pressing Enter. n) Save your planning. Evaluate Costs Cost Comparison Now that you planned your cost manually, you want to compare your planning to the automatic cost planning of the network. 1. Compare your planning to the automatic cost planning of the network by running a cost element report. Use the following data: Field Project Controlling Area Value E 00## A000 Plan Version A 0 Plan Version B 1 From fiscal year Copyright. All rights reserved.

39 Lesson: Planning a Project Field Value To Fiscal year 2017 From Period 1 To Period 12 Use the info profile a) In the SAP Easy Access Menu, choose Information System Project System Financials Costs Plan based By Cost Element Comparison of 2 Plan Version. Alternatively, use transaction code S_ALR_ b) In the dialog box, enter the info profile c) On the initial screen of Comparison of 2 Plan Version enter the data provided in the table. d) Execute the report. You see a cost element report for your project. Write down the planned costs for Version 0 and for Version 1 (the figures can vary, so no solution is provided). Planned Costs Version 0: Planned Costs Version 1: Copyright. All rights reserved. 747

40 Unit 11: Project System LESSON SUMMARY You should now be able to: Plan Resources in a project Plan dates in a project Plan costs in a project 748 Copyright. All rights reserved.

41 Unit 11 Lesson Budgeting in a Project LESSON OBJECTIVES After completing this lesson, you will be able to: Create the budget for a project Budgeting in a Project Figure 338: Budget Planning in a Project The budget is the approved cost structure for a project. Having estimated the costs as accurately as possible, using the different tools during the planning phase, you then prescribe the funds available for your order in the form of a budget. While you must estimate your project costs as accurately as possible during cost planning, funds are assigned in the form of a budget in the approval phase. The budget differs from the project Copyright. All rights reserved. 749

42 Unit 11: Project System cost plan in that it is binding. The budget is the device by which the management approves the anticipated development of the project costs over a given period of time. Budgeting Overview Figure 339: Budgeting Overview Discuss the following points: Original budget The original budget is the originally allocated budget. After a specified time, this budget can only be corrected by using budget updates. Budget Updates Budget updates can be unforeseen events; additional requirements, for example, price increases for external activities, and so on. This may mean that you need to update the original budget in the form of supplements, returns, or transfers. Current budget The current budget is derived from the value Original budget + Supplements - Returns +/- Transfers. 750 Copyright. All rights reserved.

43 Lesson: Budgeting in a Project You need to use the maintain original budget transaction to assign funds to a project and its components. In the budget profile, you can specify whether funds are assigned as lump values or are distributed by year. You can prevent users from maintaining the overall project budget for a project by assigning appropriate user statuses. If you lock (freeze) the original budget in this manner, you can change it only by defining supplements, returns, and transfers. You can use the budget release function to make funds available at various points within a fiscal year. You can use the budget carry forward function to transfer any funds not used in the previous year to the budget of the new fiscal year. Copyright. All rights reserved. 751

44 Unit 11: Project System 752 Copyright. All rights reserved.

45 Unit 11 Exercise Create the Budget for a Project Business Example After the planning of the project is done you receive a budget allocated. The budgeting takes place based on the cost planning. Be aware that the budget will be allocated for the entire project. For the budgeting you will copy the existing planning from Version 0 into the budget. Note that, in this exercise, when the values include ##, replace ## with the number your instructor assigned to you. 1. After you planned the costs in the project, your project E 00### receives a budget. Allocate a budget based on the cost planning in the network Version 0. Assign only an original budget; there is no released budget planned in the budget profile. Use the following data: Field Project Definition Value E 00## 2. Assign 90% of the planned costs as a budget. Note: It is possible that you have planned figures for more than one year. The budgeting then needs to be done for each year. Copyright. All rights reserved. 753

46 Unit 11 Solution Create the Budget for a Project Business Example After the planning of the project is done you receive a budget allocated. The budgeting takes place based on the cost planning. Be aware that the budget will be allocated for the entire project. For the budgeting you will copy the existing planning from Version 0 into the budget. Note that, in this exercise, when the values include ##, replace ## with the number your instructor assigned to you. 1. After you planned the costs in the project, your project E 00### receives a budget. Allocate a budget based on the cost planning in the network Version 0. Assign only an original budget; there is no released budget planned in the budget profile. Use the following data: Field Project Definition Value E 00## a) On the SAP Easy Access screen, choose Logistics Project System Financials Budgeting Original Budget Change. Alternatively, use transaction code CJ30. b) On the Initial screen of Change Original Budget, in the Project Definition field, enter E 00## and press Enter. c) In the Change Original Budget: WBS Element Overview screen, select all WBS Elements. 2. Assign 90% of the planned costs as a budget. Note: It is possible that you have planned figures for more than one year. The budgeting then needs to be done for each year. a) Select the Planned Totals, and from the menu, choose Edit Copy View. b) In the Copy View window, change the percentage to 90% and press Enter. c) Change the period to the next year. d) If there are planned costs for the next year as well, proceed as above. e) Save the budgeting. f) Ignore the Warning by pressing Enter. 754 Copyright. All rights reserved.

47 Lesson: Budgeting in a Project LESSON SUMMARY You should now be able to: Create the budget for a project Copyright. All rights reserved. 755

48 Unit 11 Lesson Executing a Project LESSON OBJECTIVES After completing this lesson, you will be able to: Execute a project Record labor for a project Post materials for project Executing a Project Figure 340: Issuing Materials from Stock to a Project You plan material requirements by assigning material components to activities. Material requirements form the basis for procurement (whether the material is to be produced in-house (production) or procured externally (purchasing). You can manually assign material components to activities. Alternatively, you can use the BOM-PS interface to assign Bill of Material (BOM) components automatically to activities. 756 Copyright. All rights reserved.

49 Lesson: Executing a Project Materials establish the link between PS and Sales and Distribution (SD), Materials Management (MM), and Production Planning and Control (PP). By assigning materials to activities, you can plan the necessary material requirements for a project. A distinction is made between stock and nonstock items. Project Integration with MM and PP Figure 341: Project Integration with MM and PP The item category stock item is used for materials that are kept in stock (warehouse, project, or sales order stock). You create reservations for stock items. Independent requirements (requirements for finished products, saleable assemblies, trading goods, and spare parts) trigger requirements planning. To cover the requirements, you determine order quantities and dates and schedule the corresponding procurement elements. The procurement element for requirements planning is a planned order and, for external procurement, a purchase requisition. In addition, you determine the dependent requirements for materials produced in-house (in other words, the quantity of components required to manufacture a finished product or assembly) by exploding the Bill of Material (BOM). You can create planned orders at each BOM level to cover requirements when a material shortage occurs. After the quantities and dates are planned in requirements planning, you convert these planned procurement elements to exact procurement elements. For production, this element is the production order, and for external procurement, this element is the purchase order. Copyright. All rights reserved. 757

50 Unit 11: Project System Procuring Non-Stock Materials for a Project Figure 342: Procuring Non-Stock Materials for a Project The item category N (nonstock item) is used for components that are not procured by way of warehouse stock, project stock, or sales order stock but are procured directly by the network activity. Purchase requisitions are created for these components. These requisitions are passed directly to purchasing. When the goods are received, they are not placed into stock but posted to the activity. Nonstock items cannot be managed as project stock or sales order stock. 758 Copyright. All rights reserved.

51 Unit 11 Exercise Release a Project Business Example You planned dates and resources in your project. Now you want to assign the materials from the original BOM of the bicycle to your project. Therefore, you create a project BOM and assign it to the project. Once you have planned the materials you will release your project. Note that, in this exercise, when the values include ##, replace ## with the number your instructor assigned to you. Create the Project BOM You want to create a WBS BOM to be used as a template in your project. 1. Copy the existing BOM for T-F1## from production to a WBS BOM for the WBS Element E 00##-3. Use the following data: Field WBS Element Material Value E 00##-3 T-F1## Plant 1010 BOM Usage 3 Copy Material BOM T-F1## Plant 1010 Usage 1 Reference Point ZTS410 Adjust Project Assign Components to Project 1 1. Assign the components to the project. Use the PS BOM interface to assign your newly created BOM to your project. Use the following data: Field Project Definition WBS Element Profile Value E 00## E 00##-3 Z410 Copyright. All rights reserved. 759

52 Unit 11: Project System Field Material Value T-F1## Plant 1010 BOM Usage 3 Release the Project After the planning of your project is finished now you want to see whether the materials have been assigned and you will release your project. 1. Open your Project. 2. Are your materials assigned? 3. Release your project using the Project Definition E 00##. 760 Copyright. All rights reserved.

53 Unit 11 Solution Release a Project Business Example You planned dates and resources in your project. Now you want to assign the materials from the original BOM of the bicycle to your project. Therefore, you create a project BOM and assign it to the project. Once you have planned the materials you will release your project. Note that, in this exercise, when the values include ##, replace ## with the number your instructor assigned to you. Create the Project BOM You want to create a WBS BOM to be used as a template in your project. 1. Copy the existing BOM for T-F1## from production to a WBS BOM for the WBS Element E 00##-3. Use the following data: Field WBS Element Material Value E 00##-3 T-F1## Plant 1010 BOM Usage 3 Copy Material BOM T-F1## Plant 1010 Usage 1 Reference Point ZTS410 a) On the SAP Easy Access screen, choose Logistics Production Master Data Bill of Material (BOM) Bill of Materials WBS BOM Single Level Create. Alternatively, use transaction code CS71. b) On the Initial screen of Create WBS BOM, enter the following data: Field WBS Element Value E 00##-3 Copyright. All rights reserved. 761

54 Unit 11: Project System Field Material Value T-F1## Plant 1010 Usage 3 c) Choose the Copy Material BOM icon. d) In the Copy Material BOM window, enter the following data: Field Material Value T-F1## Plant 1010 Usage 1 e) Press Enter. f) Select all of the items and choose the Copy icon. g) On the screen Create WBS BOM General Item Overview screen, select all of the items. h) To choose the Detail of the first item, double-click the item number. i) In the Item detail, in the Reference Point field, enter ZTS410. j) Repeat steps h) to i) for all items. k) Save the BOM. Adjust Project Assign Components to Project 1 1. Assign the components to the project. Use the PS BOM interface to assign your newly created BOM to your project. Use the following data: Field Project Definition WBS Element Profile Material Value E 00## E 00##-3 Z410 T-F1## Plant 1010 BOM Usage Copyright. All rights reserved.

55 Lesson: Executing a Project a) On the SAP Easy Access screen, choose Logistics Material Planning Bill of Material Transfer. Alternatively, use transaction code CS71. b) On the Initial screen of Bill of Material Transfer enter the following data: Field Project Definition WBS Element Profile Value E 00## E 00##-3 Z410 c) Choose the Selection Parameters icon (Shift + F5). d) In the Selection of BOM Item section, enter the following data: Field WBS Element Material Value E 00##-3 T-F1## Plant 1010 BOM Usage 3 e) Choose Execute (F8). f) Confirm the warning by pressing Enter. g) On the Result Overview screen, check whether all the components have been selected and assigned to your network Operation 40. h) Save the assignment. Release the Project After the planning of your project is finished now you want to see whether the materials have been assigned and you will release your project. 1. Open your Project. a) On the SAP Easy Access screen, choose Logistics Project System Project Project Builder. Alternatively, use transaction code CJ20N. b) To open your Project, double-click your project in the Worklist section. c) Expand your project. 2. Are your materials assigned? There should be 4 materials assigned to operation Release your project using the Project Definition E 00##. Copyright. All rights reserved. 763

56 Unit 11: Project System a) Select your Project Definition and choose the menu entry Edit Status Release. b) Save your project. 764 Copyright. All rights reserved.

57 Lesson: Executing a Project Planned versus Actual Dates Figure 343: Planned versus Actual Dates Discuss that confirmations record the progress of activities. Explain the results of confirmations, including posting the actual costs, dates, and labor (work) and, if applicable, changing the activity status. Also, discuss the different options for entering confirmations. During the planning phase, you enter basic dates for the Work Breakdown Structure (WBS) elements either by creating graphical time bars in the project planning board or by posting direct entries in the master data. In the execution phase, you can set actual dates in the same way as in the project planning board. The Partially Released or Released status must be set before you can enter the actual start and end dates for WBS elements. To monitor dates in the project, compare the basic dates with the actual dates, that is, compare the planned dates with the actual dates or forecasted completion dates. You can use the project planning board or structure information system for analysis purposes. Copyright. All rights reserved. 765

58 Unit 11: Project System Cross-Application Time Sheet (CATS) Figure 344: Cross-Application Time Sheet Explain that once time is entered on a time sheet, it can be approved and then transferred to different applications. Cross-Application Time Sheet (SAP CATS) is an integrated function for entering actual time data important in Human Resources (HR), Project System (PS), Plant Maintenance (PM), Customer Service (CS), and Controlling (CO). You can determine the layouts by using data entry profiles. 766 Copyright. All rights reserved.

59 Unit 11 Exercise Post a Confirmation of Time for your Project Business Example The project engineer has worked some hours for the project. You now need to confirm the time for the first two operations. For the following posting you will use CATS later in the next exercise. You will use a collective confirmation for the first posting. Note that, in this exercise, when the values include ##, replace ## with the number your instructor assigned to you. 1. Confirm the first two operations using the following data: Field Network Value Your network number Operation 10 and 20 Actual Work activity 10 8 Actual work activity Copyright. All rights reserved. 767

60 Unit 11 Solution Post a Confirmation of Time for your Project Business Example The project engineer has worked some hours for the project. You now need to confirm the time for the first two operations. For the following posting you will use CATS later in the next exercise. You will use a collective confirmation for the first posting. Note that, in this exercise, when the values include ##, replace ## with the number your instructor assigned to you. 1. Confirm the first two operations using the following data: Field Network Value Your network number Operation 10 and 20 Actual Work activity 10 8 Actual work activity a) On the SAP Easy Access screen, choose Logistics Project System Progress Confirmation Collective Confirmation. Alternatively, use transaction code CN27. b) On the Initial screen of Network Confirmation Collective Confirmation, enter the following data: Field Value Actual Work activity 10 8 Actual work activity c) In the upper section enter your network number. d) Press Enter. e) In the lower section enter now the following data: 768 Copyright. All rights reserved.

61 Lesson: Executing a Project Field Value Activity 10 Activity 20 f) Press Enter. g) Save the confirmation. h) Confirm any warnings or errors while saving. Copyright. All rights reserved. 769

62 Unit 11: Project System 770 Copyright. All rights reserved.

63 Unit 11 Exercise Post Time Confirmation with CATS Business Example As an alternative for the confirmation of time you want to use CATS for the time recording. As you have assigned an employee number to your network you will check the possibilities via CATS. Note that, in this exercise, when the values include ##, replace ## with the number your instructor assigned to you. 1. Post the times for activity 30 and 40 with reference to your employee number. Use the following data: Field Data Entry Profile Personnel Number Activity 30 Activity 40 For Activity 30 For Activity 40 Value ZTS410 Your employee number Copy in the Data Entry Area Copy in the Data Entry Area 5 hours each day of the week 3 Hours each day of the week 2. Transfer the time recording data to the Project System. Use the following information: Field Personnel Number Posting Date Test Run Value Your employee number Today Delimit Copyright. All rights reserved. 771

64 Unit 11 Solution Post Time Confirmation with CATS Business Example As an alternative for the confirmation of time you want to use CATS for the time recording. As you have assigned an employee number to your network you will check the possibilities via CATS. Note that, in this exercise, when the values include ##, replace ## with the number your instructor assigned to you. 1. Post the times for activity 30 and 40 with reference to your employee number. Use the following data: Field Data Entry Profile Personnel Number Activity 30 Activity 40 For Activity 30 For Activity 40 Value ZTS410 Your employee number Copy in the Data Entry Area Copy in the Data Entry Area 5 hours each day of the week 3 Hours each day of the week a) On the SAP Easy Access screen, choose Logistics Project System Progress Confirmation Time Sheet CATS Classic Record Working Times (CAT2). b) On the Initial screen of Time Sheet enter the following data: Field Data Entry Profile Personnel Number Value ZTS410 Your employee number c) Choose the Enter Time icon (F5). d) In the Work List section, select Activity 30 and Activity 40 and choose the Copy Row icon (F5). 772 Copyright. All rights reserved.

65 Lesson: Executing a Project e) In the Data Entry Area for each activity, enter the following data: Field For Activity 30 For Activity 40 Value 5 hours each day of the week 3 Hours each day of the week f) Press Enter. g) Choose the Release View icon. h) Select the two activities and choose the Release icon. i) Save the data. j) Confirm any messages with Enter. 2. Transfer the time recording data to the Project System. Use the following information: Field Personnel Number Posting Date Test Run Value Your employee number Today Delimit a) On the SAP Easy Access screen, choose Logistics Project System Progress Confirmation Time Sheet Transfer Project System Transfer (CAT5). b) On the Initial screen of CATS Transfer to Project System, enter the data provided in the table. c) Choose Execute (F8). Copyright. All rights reserved. 773

66 Unit 11: Project System Posting Materials for a Project Figure 345: Procuring Materials and Services for a Project Using the steps listed on the slide, explain the purchasing process. The network generates purchase requisitions for external processing activities, service activities, and materials that are procured directly. These purchase requisitions are passed on to the purchasing department for further processing. The purchasing process involves issuing a request for quotations to vendors (if applicable), entering these quotations in the system, selecting vendors, converting the purchase requisitions into purchase orders, and monitoring the orders until the goods and invoices are received. A service activity triggers a similar purchasing process but can also contain a hierarchy of planned services to be purchased and value limits for unplanned services. The goods receipt for services involves the following steps: 1. Entering the services performed 2. Accepting the services performed 774 Copyright. All rights reserved.

67 Lesson: Executing a Project FI and CO Postings in a Project Figure 346: FI and CO Postings in a Project A purchase requisition that is generated for a project results in a purchase requisition commitment for the account assignment object (activity or Work Breakdown Structure (WBS) element). When the purchase requisition is converted into a purchase order, this results in a purchase order commitment for the account assignment object (this object is a different value type than purchase requisition commitments). Depending on the account assignment category of the purchase order, you can post the actual costs upon the receipt of the goods or their invoice (valuated or nonvaluated goods receipt). Based on the account assignment, the system passes the relevant documents concerning goods movement on to the network activity or WBS elements. As an alternative to having the network generate the purchase requisitions automatically, you can also manually create purchase requisitions and purchase orders and assign them to WBS elements. The figure shows business transactions that establish a connection to WBS elements or activities by using an assignment. By assigning the appropriate documents, the resulting commitment or actual costs are posted directly to a WBS element or the network or activity. During the project planning phase, these costs were planned accordingly. Examples of costs that you can plan include the following: Copyright. All rights reserved. 775

68 Unit 11: Project System Costs for purchase requisitions, purchase orders, and goods receipts at the network or activity level, using externally processed activities, service activities, or material components that are procured directly Stock withdrawn from the warehouse using the appropriate stock items Invoices posted by using cost activities and costs arising as a result of confirmations by using internally processed activities Actual costs and revenues arising from purchase requisitions, purchase orders, goods receipts, activity allocations, and invoices for WBS elements match the values of the primary costs, activity input, and revenue planning data for the WBS. 776 Copyright. All rights reserved.

69 Lesson: Executing a Project LESSON SUMMARY You should now be able to: Execute a project Record labor for a project Post materials for project Copyright. All rights reserved. 777

70 Unit 11 Lesson Processing Period-End Closing Activities LESSON OBJECTIVES After completing this lesson, you will be able to: Process period-end closing activities Period-End Closing Activities Figure 347: Period-End Closing Activities Period-end closing is the framework for carrying out period-related commercial transactions. You use it to ensure that you have determined all the data belonging to a period and that the data is available for enterprise control purposes. Template Allocation While a distributed flat rate is used overhead, the template allocation distributes overhead from business processes or cost center or activity types. Overhead Rates 778 Copyright. All rights reserved.

71 Lesson: Processing Period-End Closing Activities Use overhead costing to allocate overhead through percentage-based or quantity-based overhead rates. The basis for the allocation is the primary cost elements that you post as overhead costs. Project Interest Calculation Valuates fund commitments, using costs, revenues, or payments to achieve the best possible project payment flow. Cost Forecast Used to adapt cost planning for changing circumstances. For the cost to complete, the system determines and values the remaining activities on the basis of the plan, forecast, and actual values in the network. The resulting figure is arrived at by adding the actual and commitment costs already incurred in the project to the updated cost to complete. Progress Analysis Used to determine planned and actual project progress values, and to compare the two sets of data. The system uses the overall planned costs to evaluate the work done, therefore the evaluation is not dependent on the costs planned or posted by period. You can determine the relevant values at any time or as part of the period end closing. Use progress analysis to obtain information on the status of your project and how it is developing, which enables you to take corrective action if the project is differing from its plan. Results Analysis A periodic valuation of the project is performed. You can analyze the results of WBS element costs, which are capitalized and used to set up provisions. Results analysis is usually performed in the billing element. Incoming Orders The system uses this function to determine the costs and revenues expected to arise from orders closed or changed in the current period. You can evaluate the values for incoming orders, open orders in the project information system and settle them using profitability analysis. Copyright. All rights reserved. 779

72 Unit 11: Project System Settlement of a Project Figure 348: Performing a Settlement for a Project You collect costs and revenues in projects only temporarily and settle them for one or more receivers as a part of period-end processing. Settlement is the process in which the actual costs incurred for WBS elements, networks, and activities are allocated, in whole or in part, to one or more receivers. In the process, the system generates offset entries crediting the project. The debit postings remain in the receivers after settlement. You can display the debit postings in the information system. You can record the settled costs in the relevant receiver and evaluate them in reporting. Actual costs and actual revenues arise in a project or order as a result of the following situations: Material withdrawals and goods receipts Vendor invoices Customer billing Internal activity allocations, transfers, cost distribution, process costs, and overheads Confirmation of network activities In settlement, costs or revenues are transferred to the following departments: FI (G/L account) Asset Accounting (fixed assets) 780 Copyright. All rights reserved.