COPA Assessment Cycles- Urgent Go-Live this weekend !!!!

[Former Member]

Hi Gurus,

Have a small question about COPA Assessment Cycle. Please help as the Go-Live is this weekend !!!

We are using Costing Based Profitability. All the Cost centers are assigned to respective Profit centers so that all the cost flow into Profit center.. That being said.. What does the COPA assessment cycle do ? Do I still need to create the cycles? what are the rules for it ?

Please help !!

Thanks

JP

[Former Member]

Hiya,

Like Jayram suggested, COPA is used to provide a full view of your profitability.

I would always, suggest assessing costs out of Cost Centres. The reason being, costs sitting in cost centres do not provide the full picture to the business regarding operations. It is so easy to ignore costs sitting "idle" in Cost Centres and thus have an masked view of one's profitability.

If you have Costing-Based COPA in place, the objects behind it must be to have a better view of one's profitability. This is to assist (esp. the Sales and Marketing teams) in deciding where to sell product to maximise profits, etc. If you leave costs behind in a Cost Centre, your basic objective of activating Costing-Based COPA is defeated.

Then again, like I mentioned in my earlier post, it is purely your business decision that should drive this. Personally, I would always make sure there is no cost lying in Cost Centres at the end of the period.

Cheers.

[Former Member]

Thanks you everybody.. Though there has been no solution to this yet.. I have assigned all the points for your input. Right now I have suggested them to view the Profitability analysis as per revenue only and the other costs can be viewed at the profit/cost center level. Lets see how it goes..

Once again thanks a lot for your prompt replies

Thnaks

JP

[Former Member]

Hiya,

The COPA Assessment cycle assesses costs from your Cost Centres to COPA Value Fields. Whether it is required in your case depends on what your business objectives are...

As a case in point, if there are some administrative overheads booked to a cost centre and you wish to assess these costs across (say) 10 Regions, you will then define an Assessment cycle that posts from this Cost Centre, to a Value Field, with the 10 Regions as the Characteristics. Your Asssessment Cycle segment therefore will comprise a posting rule for each of these Regions, either based on % or a fixed amount or whatever.

If Profit Centres are assigned to your Cost Centres, that only suggests that the costs are reflected in the Profit Centres as well. A P&L statement by Profit Centre will reflect the costs. All relevant costs / revenues having been posted to these Profit Centres, you can still derive the same P&L statement from COPA, once you have assessed the costs.

Hope this helps.

Cheers.

[Former Member]

Thanks a lot Ram for the quick reply but I m still confused about this..

All my revenues are flowing through from SD and all my manual adjustments are going through my PA transfer structure.

The costs should flow through the Cost centers.. The point where you said

"The COPA Assessment cycle assesses costs from your Cost Centres to COPA Value Fields. Whether it is required in your case depends on what your business objectives are..."

Does that mean that I DONT necessarily assess my cost over to COPA ? I mean can we just leave COPA with only Revenues ?

As the Costs are Product specific and the product cost are flowing into the respective Profit centers. Do I still need to push my cost to COPA ?

Sorry to bug you but I have to reply to everyone within the next three hours.

Thanks

JP

[former_member200240]

Hi

The objective of COPA is to arrive at Profitability or Margin product-wise. The more accurate it is reflected in COPA, the better. That means, it is better to push all Product-specific costs to COPA so that we can arrive at Profit/Product or Customer, etc. So all costs are to be mapped to Value fields in COPA. Generally most of the product specific costs come from Product Costing.However some general costs like admn which you cannot specifically identify to a product/customer/market, etc, you can do assessments as suggested or you can even leave.

Hope it is clear

Jayaram