SAP has started recommending Account Based CO-PA in S/4HANA products (S/4HANA and

S/4HANA Finance) based on three main innovations (COGS split, variance posting Categories
wise, and additional quantity fields) in Account Based CO-PA. We need to understand first if
these three things were only missing in Account Based CO-PA earlier, and because of it all the
organizations (at least all manufacturing org.) were using Costing Based CO-PA and SAP also
used to recommend Costing Based CO-PA before advent of S/4HANA products or there was
more? Let’s find out.

Secondly I have always liked SAP Controlling over SAP Finance and this is the area where I
have been more comfortable. I realised that I have written more blogs on S/4 HANA Finance
than S/4 HANA Management Accounting. Trying to balance out with this.

Fairly, we will cover below items:

 Understanding of costing based CO-PA and account based CO-PA

 Actual Data in COPA
 Planning Data in COPA
 What’s New in S/4HANA
 Comparison Between Costing Based and Account Based CO-PA and much more

# Comparison Between Costing Based and Account Based CO-PA

This comparison table is for them who just skim and don’t go into the details, rest can go through
entire article.

Base Costing Based CO-PA Account Based CO-PA

Postings Data is transferred to COPA as soon Data is transferred when accounting

as sales order is created document is posted to Financial
Accounting

Data Carrier Data is transferred with Value Fields Data is transferred with Cost and
to costing based COPA tables Revenue elements to ACDOCA tables

COGS Posting COGS is posted with billing COGS is posted with post goods issue
document posting (PGI)

Reconciliation Reconciliation value field with GL Always reconciled with Financial

is difficult Accounting

COPA Currencies Storage in operating concern Storage in controlling area currency

currency and company code and company code currency and
currency transactional currency

Variance Settle the variance categories to Settle the variances to account-based

Settlement costing-based CO-PA, assign the CO-PA, use the Price Difference
combination of variance categories Splitting Profile to assign the
and cost elements to the specific combination of cost elements and
value fields. variance categories to the scheduled
target accounts.

Other Settlement In costing-based CO-PA, costs are Settlement – In account-based CO-

settled from the original cost PA, costs are settled to the settlement
elements to the value fields to which cost element specified in the
 they are assigned in the PA transfer settlement structure.
structure.

Parallel Valuation Costing based COPA provides 6 NA

parallel valuations for calculating
the cost of goods sold (COGS). This
enables you compare the standard
cost for sales processes with
different production opportunities in
different plants.

Top Down Top Down Distribution for actual Top-Down distribution works in
Distribution postings is available at detailed level account based COP as well, selection
(Actual) in costing based COPA criteria must be account/cost element

Top Down Top Down Distribution for plan data Top Down Distribution for plan data
Distribution (Plan) is available in costing based COPA is available in account based COPA

Sales Order In the costing-based Profitability This Function not available in account
Analysis Analysis, you can transfer the sales based COPA
order data to Profitability Analysis
so that an early analysis of profit
forecast can be carried out.

Planning In costing-based CO-PA, you use In account-based CO-PA, the plan

the SAP Fiori apps for planning. data is updated in tables COEJ (plan
The data is updated in the CO-PA line items) and COSP (plan total).
tables

Bottom Up Plan values are planned bottom-up, Plan values are planned bottom-up,
Planning and merging of plan values can and merging of plan values can occur
occur in several steps. in several steps.

SAP COPA Tables Costing based COPA Stores Data in Account based COPA Stores data in
& Data Structure CE1XXXX to CE1XXXX tables: general CO tables, as below:
 CE1XXXX is actuals data  Line item actual data in
 CE2XXXX is Plan data ACDOCA
 CE3XXXX & CE4XXXX  Line item plan data in
contain aggregated and ACDOCP
segment level data  Actual line item in COEP
value type, not equal to 4 and
XXXX = Operating Concern not equal to 11
 Plan line item in COSP &
COEJ specific value types

Future Innovations No future innovation for costing Account based COPA will be
in S/4HANA based COPA in S/4HANA innovation path always in S/4HANA.
Since ACDOCA is the primary table
in S/4HANA and account based
COPA only update ACDOCA tables

# Basic Concept of COPA

The basic concepts of CO-PA include the following:

 Characteristics

Characteristics are those entities that you want to report on. These include divisions, regions,
products, and customers.

Note: In addition to the fixed characteristics, up to 50 non-fixed characteristics can be added to

an operating concern. So use them wisely. Refer SAP Note. 10293911029391.

 Characteristic Values

Characteristic values are the values that the characteristics in your report should display. For
example, region is a characteristic with south as its value, and company code is a characteristic
with 1000 as its value.

 Profitability Segments

Profitability segments are the technical definitions of combinations of several characteristics and
their values. For example, a combination of North region, T-F100 product, and Sales Rep Miller.

 Value Fields (Costing Based COPA)

Value fields are the amount and quantity fields with which performance can be measured and
analysed. Examples include gross sales, surcharges, discounts, and cost of sales.

Note: Maximum 200 values fields can be created, so use them wisely. Refer SAP Note.
10293911029391.

 Cost Elements (Account Based COPA)

Cost Elements plays similar role account based COPA as Value fields in costing based COPA.
Amount and quantity fields with which performance can be measured and analysed are posted to
account based COPA through Cost Elements.
# Data Structure and COPA Tables

Copy the required characteristics and value fields (applicable for costing-based CO-PA) to the
operating concern, save them, and activate the data structures. With activating the data
structures, all the necessary tables are created. When assigning characteristics and value fields,
activation is required. Otherwise the assignment will be lost.

During the generation process, the system creates the tables CE1XXXX through CE8XXXX

Note that the data in costing-based Profitability Analysis (CO-PA) is stored in separate tables,
and the data for account-based CO-PA is stored in the same tables as the other Controlling
(CO)modules.
# COPA – Actual Data

Revenues and discounts are transferred to profitability segments in Profitability Analysis (CO-PA)
at the point of billing in sales order management.

The value fields in the costing-based CO-PA contain the amounts and quantities that you want to
report on. The value fields represent the finest level of detail at which costs and revenues are
broken down. One of the most important tasks in Customizing for the costing-based CO-PA is to
assign your costs and revenues to the required value fields. This assignment enables you to
calculate the contribution margins that your organization requires in Information System.
Contribution margin can also be analysed in account-based CO-PA. This analyses the COGS
(using define splitting scheme) and also the different variance categories (using define Accounts
for Splitting Price Differences).

# Top Down Distribution

Top-down distribution of actual data is a periodic function. This function enables you to distribute
the aggregated data to extensive levels (such as the division level or the customer level in CO-
PA), based on reference information (such as the data from the previous year).

Periodic valuation is only available in costing-based CO-PA. It requires Material Ledger (ML),
which is automatically activated in SAP S/4 HANA

The actual costing, which previously could only be performed after a final closed period, can now
be transferred to costing-based CO-PA after the actual costing run. This function does not
update the FI-Table ACDOCA.

Note: Actual top-down distribution cannot be performed across business areas.

# COPA – Plan Data

The Integrated Business Planning (IBP) for SAP Simple Finance applications provide a
consistent view of the planning process. From the UI perspective, all planning applications can
be accessed by a Microsoft Excel front-end to provide a homogeneous look and feel. There are
no longer silos for the planning data. All planning data is now contained in a real-time info cube
of the local Business Warehouse (BW), which is optimized for SAP HANA. Actual data and
master data are accessed directly in real time without any replication that would be necessary in
a standalone BW.

In costing-based CO-PA, you use the SAP Fiori apps for planning. The data is updated in the
CO-PA tables.

In actual release 1610, you cannot transfer the data to FI GL and Profit Center Accounting (PCA)
in New GL.

In account-based CO-PA, the plan data is updated in tables COEJ (plan line items) and COSP
(plan total).

# Bottom Up Planning

Plan values are planned bottom-up, and merging of plan values can occur in several steps. For
example, the default plan values can be created automatically (copied or revaluated) and then
used as a plan basis for individual sales representatives.

Integrated Microsoft Excel allows sales representatives to create their sales plan data locally.

Finally, the individual plans can be merged into a single version and valuated with the operative
prices and costs of goods manufactured. 

# What’s New in S/4HANA

There are some glaring changes in S/4HANA in regard to account based CO-PA, mentioned
below.

1. Define Accounts for Splitting the Cost of Goods Sold

In this Customizing activity, you can refine the settings for changes in inventory or COGS
postings to split the amount and post it to different accounts according to the cost components
that are used in the underlying costing sheet. The respective cost component amount is then
used for the corresponding journal entry line item.

Path: IMG → Financial Accounting (New) → General Ledger Accounting (New) → Periodic

Processing → Integration → Materials Management→ Define Accounts for Splitting the Cost of
goods sold.
2. Define Accounts for Splitting Price Differences

This customizing helps in posting production variances as per variances categories.

 Path: IMG → Financial Accounting (New) → General Ledger Accounting (New) → Periodic
Processing → Integration → Materials Management→ Define Accounts for Splitting the Cost of
Goods Sold

3. Define Additional Quantity Fields

This customizing helps you having additional quantity fields in your transactions and reporting.

Path: IMG à Controlling à General Controlling à Additional Quantities à Define additional

quantities
# Conclusion

Has Account Based COPA Evolved Enough to be Recommended?

Having jotted down all the points I am not very comfortable to advise a manufacturing
organization to implement account based COPA over costing based COPA. There are many
values need to be taken to COPA starting from sales order and many of them are statistical too
(though for this also workaround is there in Account Based COPA, like create extra condition
types with GL postings to FI twice during billing which will post to COPA and it won’t have impact
on the FI. Later on select required data in the COPA reporting).

I have discussed this scenario and my experience with SAP on this matter in one of my blog on
SAP Community https://blogs.sap.com/2018/02/02/first-s4-hana-enterprise-management-
implementer-how-it-feels-to-be-a-success-story/

Secondly comparison sheet is also giving weightage to Costing based COPA, but on the other
hand it is also true that all the innovations in S/4HANA will be made available for account based
COPA. So, ‘choose wisely’.

Changes to Profitability Analysis in Controlling Module

Storage and Numbering of Profitability Segments

The way in which profitability segments are stored and numbered in the system has been modified.
A separate type of profitability segment is now stored in table CE4XXXX_ACCT (XXXX denotes the
operating concern). Just as with the profitability segments in table CE4XXXX, those in table
CE4XXXX_ACCT assign a unique number to each combination of characteristic values. However, in
table CE4XXXX_ACCT a new number is assigned for each new business process. Furthermore,
characteristic summarization is not applied to this table.
Additional Details

Profitability segments contain a combination of characteristic values for a business process to be

posted. Each of these combinations is assigned a unique number which is used throughout the
system to transfer this information, for example from a billing document to Accounting. The
assignment between profitability segment numbers and the corresponding characteristic values is
stored in table CE4XXXX, where XXXX denotes the operating concern.

Up to and including SAP S/4HANA 1610, the profitability segment numbers are reused. That is, if two
business processes are assigned to the same combination of characteristic values, only one entry is
created in table CE4XXXX and the same profitability segment number is used by both processes.

One drawback of this solution is that it can degrade performance in systems containing large
amounts of data because each new business process attempting to assign a profitability segment
number for its characteristic values has to read table CE4XXXX to determine if this combination
already exists or if a new profitability segment number needs to be assigned. Another drawback is
that characteristic summarization (transaction KEQ7) is applied to table CE4XXXX such that
information sometimes gets lost unexpectedly in a business process if a characteristic is summarized.

Therefore, starting with SAP S/4HANA 1709, an additional type of profitability segment is
(re-)introduced (see SAP Note 199467). These profitability segments are stored in table
CE4XXXX_ACCT. Just as with the profitability segments in table CE4XXXX, those in table
CE4XXXX_ACCT assign a unique number to each combination of characteristic values. The difference
is as follows:

In table CE4XXXX_ACCT, a new number is assigned for each new business process instead of reusing
the existing numbers

Characteristic summarization is not applied to table CE4XXXX_ACCT

Profitability segments are created in table CE4XXXX_ACCT if you are using account-based
profitability analysis, which is the default in SAP S/4HANA. If you are using costing-based profitability
analysis in addition, a (reused and summarized) profitability segment is created in table CE4XXXX for
each of the profitability segments in table CE4XXXX_ACCT. The tables are linked via field CE4KEY in
table CE4XXXX_ACCT which contains the profitability segment number of table CE4XXXX. This is for
compatibility reasons. If you are using only account-based profitability analysis, in most cases only
profitability segments in table CE4XXXX_ACCT are created.

Note that there are three cases in account-based profitability analysis where profitability segments
are created only in table CE4XXXX:

Cost center assessment to profitability analysis

Top-down-distribution

Classical planning functionality like transaction KEPM (Planning Framework) or plan cost center
assessment to profitability analysis (not valid for Integrated Business Planning)

Classical planning functionality like transaction KEPM (Planning Framework) or plan cost center
assessment to profitability analysis (not valid for Integrated Business Planning)

Effects on Existing Data

Previously, data was read using a join between profitability segment table CE4XXXX and CO actual
line item table COEP (which in SAP S/4HANA is a so-called compatibility view that redirects the select
to table ACDOCA internally). For new actual data, only profitability segments in table CE4XXXX_ACCT
are created in most cases. Reading data solely from table CE4XXXX, without considering
CE4XXXX_ACCT, will thus lead to incomplete or inconsistent results.

Reading account-based actual data may need to be adapted in customer-owned programs.

Therefore, all standard functionality in SAP S/4HANA 1709 reads account-based actual data directly
from G/L line item table ACDOCA, since this table also contains the characteristic values and thus
renders a join unnecessary.

There may however be customer-owned programs that read account-based data via the join on
table CE4XXXX and COEP, either by performing a direct select or by using the classical read interface
of function module RKE_READ_OBJECTS (can be displayed using transaction SE37).

Hence in SAP S/4HANA 1709, any such customer-owned programs need to be adapted so that they
select their data directly from G/L line item table ACDOCA or by using standard read modules of
profitability analysis.

Note that function module RKE_READ_OBJECTS will lead to a short dump when trying to select
actual account-based data.