BUSINESS PROCESS PROCEDURE

Created by
Iqbal Khan Title: Settle Production Orders
Organization/Area Production Planning
Bristlecone EUP Category:
File Name: 344377378.doc Release: R/3 4.7
Responsibility: Production Controller Status:

Overview

Trigger:
Once a Production Order has been completed (goods issue, goods receipt, confirmation) it must be
settled in order to collect the actual cost of production.

When a production order is settled, the actual costs incurred for the order are settled to one or more
cost-objects (to the account for the material produced or to a sales order). Offsetting entries are
automatically generated to credit the order.

If the costs for the production order are settled to a material account, the order is credited each time
material is delivered to stock. The material stock account is debited accordingly. If the costs for the
production order are settled to another receiver (for example to a sales order), the order is credited
automatically at the time of settlement. The receiver cost-objects are debited accordingly.

The debit posting remains on the order and can be displayed even after the costs have been settled.
The settled costs are updated in the corresponding receiver cost-object and can be displayed in
reporting.

Business Process Description Overview

R/3 Enterprise
Production Logistics
Production by lot size
Settlement of production order (Collective)

Input - Required Fields Field Value / Comments

Plant Plant Number

Period Settlement Period

Fiscal year Relevant Fiscal Year

Processing type The mode of processing the settlement.

Output - Results Comments

Settled Production Orders All orders, within a plant, for a given accounting period are settled simultaneously to their
respective cost collectors (depending on the order type)

Tips and Tricks

The controlling area should be already maintained.

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2/3/2017 Iqbal Khan 1 of 4
 BUSINESS PROCESS PROCEDURE
Created by
Iqbal Khan Title: Settle Production Orders
Organization/Area Production Planning
Bristlecone EUP Category:
File Name: 344377378.doc Release: R/3 4.7
Responsibility: Production Controller Status:

Procedural Steps
1.1. Access Actual Settlement : Production/Process Orders by:

Via Menus Logistics> Production> Production control

>Period-end closing> Settlement> Collect. Processing,
OR
Logistics > Production > Repetitive Manufacturing > Environment > Period-end-
Closing > Settlement > Collect. Processing,
OR
Logistics > Production > KANBAN > Environment > Production Orders > Period-end-
Closing > Settlement > Collect. Processing,
OR
Logistics > Production-Process > Process Order > Period-end-Closing > Settlement
> Collect. Processing,
OR
Logistics > Plant Maintenance > Maintenance Processing > Order > Inspection
Processing > Defect Data > Quality Notification > Costs > Actual Postings >
Settlement > Total Settlement,
OR
Logistics > Customer Service > Service Processing > Order > Inspection Processing
> Defect Data > Quality Notification > Costs > Actual Postings > Settlement > Total
Settlement,
OR
Logistics > Quality Mgmt > Quality Inspection > Worklist > Recalculate QM Order >
Settlement,
OR
Logistics > Project Systems > Resources > Capacity Requirements Planning >
Requirements Production Order > Period-end-Closing > Settlement > Collect.
Processing,
OR
Logistics > Central Functions > Batch Mgmt. > Environment > Quality Inspection >
Worklist > Recalculate QM Order > Settlement,
OR
Accounting > Controlling > Product Cost Controlling > Cost Object Controlling >
Product Cost by Period > Period-end-Closing > Single Functions : Product Cost
Collector > Settlement > Collect. Processing.

Via Transaction Code CO88

1.2. On screen Actual Settlement production/ process order, enter information in the fields
as specified in the table below:
<Insert screen here>

Last changed on: Last changed by: Version: 1.0 Page:

2/3/2017 Iqbal Khan 2 of 4
 BUSINESS PROCESS PROCEDURE
Created by
Iqbal Khan Title: Settle Production Orders
Organization/Area Production Planning
Bristlecone EUP Category:
File Name: 344377378.doc Release: R/3 4.7
Responsibility: Production Controller Status:

Field Name Description R/O/C User Action and Values Comments

Plant The plant from which orders are R Enter the plant for which you are
chosen from performing the settlement.
With If Production orders need to be O select if this needs to be included in the
production included collective processing
orders
With If Production Cost Collectors need to O select if this needs to be included in the
production cost be included collective processing
collectors
With process If Process orders need to be included select if this needs to be included in the
orders O collective processing
with QM orders If QM orders need to be included O select if this needs to be included in the
collective processing
With orders for If Orders for Projects/Networks need O select if this needs to be included in the
projects/networ to be included collective processing
ks
With orders for If Orders for cost objects need to be O select if this needs to be included in the
cost objects included collective processing
Parameters Section
Settlement settlement period R enter the period
Period
Fiscal Year Fiscal year R Enter fiscal year

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2/3/2017 Iqbal Khan 3 of 4
 BUSINESS PROCESS PROCEDURE
Created by
Iqbal Khan Title: Settle Production Orders
Organization/Area Production Planning
Bristlecone EUP Category:
File Name: 344377378.doc Release: R/3 4.7
Responsibility: Production Controller Status:

Processing Type of processing R Select processing type

type
Posting Period The settlement results are posted in R Enter in a posting period
the posting period. The posting period
can be longer than, or the same as the
settlement period, but it must be within
the specified fiscal year. The
settlement period is the same as the
posting period, unless you make an
entry stating otherwise.

Processing Options Section

Background Runs in background to avoid O Select to activate
processing overloading the system
Test Run Allows program to run without O Select to activate
changing existing data
Detail list Creates a two level log O Select to activate
Check trans Check transaction data O Select to activate Indicator for checking
data transaction data of
objects in the settlement

1.3. Choose Execute to process the settlement.

All chosen orders for a given plant in a particular fiscal period are settled to their respective cost collectors.
Inventory accounts are properly credited and debited to reflect actual usage of material and cost centers are
appropriately charged for the activities confirmed for the order.

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