Variance calculation is carried out in several steps. You must differentiate between system configuration in Customizing, which is a prerequisite for variance calculation, and the further steps executed within variance calculation itself.
The IMG menu path for all variances configuration is SPRO • CONTROLLING • PRODUCT COST CONTROLLING • COST OBJECT CONTROLLING • PRODUCT COST BY PERIOD/ORDER • PERIOD-END CLOSING • VARIANCE CALCULATION.
Define variance keys
Variance key is used for variance calculation in production order, process order, etc…
A variance key is assigned to each material and defaulted for each plant in order to determine how variances are calculated. The screenshot in Figure 5.28 is a standard SAP variance key for orders. The scrap variance calculation box is not selected, meaning that scrap variances will not be calculated. The update line items box is also not selected, which will not write the date, user ID, and change for each line item in a document. If you select the line item update, be prepared for longer run times during the variance calculation.
Figure 5.28: Define variance keys
Define variance variants
The variance variant configuration determines which variance categories can be calculated. The minor differences percentage field allows you to have small amounts of variances assigned to a category settled as remaining variances (see Figure 5.29).
Figure 5.29: Define variance variant
Define target cost versions
In the period-end closing process, you specify which target cost version the system should use to calculate the target costs.
A target cost variance is created for total, production, planning, and modified cost estimate variances (see Figure 5.30).
Figure 5.30: Define target cost version
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