Basic Costing & COPA

Costing in Excel files for Medium or Large manufacturing company would be very complex and tedious exercise with completely dependent on one person in Costing Department.
The risk is very high due to manual processes , safety of the excel files with sensitive costing data, time consuming and no audit trail w.r.t the posted data.
Costing information normally required for multiple internal and external purpose; Hence it is not safe to take risk at organization level if the stakes are so high,
Internal usage- Cost for competitive bidding, New product costing, Make or buy decision etc.
External usage – Stock valuation , Cost audit reports, Advance tax calculations etc.

Basic SAP Modules should be in place

Standard cost of the product can be fixed based on the live BOM/Routing + Latest Material prices and conversion cost at individual product code level
This standard cost can be used for valuation of inventory, COGS valuation and Variance calculations. (it is not feasible with excel costing)
Over and under absorption of fixed and variable cost can be identified at process level.
Real time contribution report based on actual revenue and standard cost for the quantity sold, this would help to take important marketing decisions for growth of sales.
Actual cost calculation would be feasible at the product and plant level through the SAP standard data.

This is the most asked questions by any costing and finance head, If the a excel file can handle then why SAP can’t handle it.
The only challenge / facility in excel is data can be changed easily without any audit log, However in SAP as well we can play with the data but with the audit log.
Calculations and formulae can be well placed in SAP same as excel with much ease and automations as well.
Formats and reporting, Yes here Excel has an upper hand, as we can place the data and information as per our choice in our way, However in SAP also this can be done, with the SAP way of formatting and Excel way of formatting.
So Yes, SAP Costing is far superior to Manual Excel Costing, and we should immediately switch to SAP costing processes.

Approach :
Based on the Industries best costing practices in SAP Costing we have prepared a comprehensive costing package for your organizations, which includes all the building blocks of costing and reporting’s.
This package will be delivered at your doorstep by our trained SAP Costing experts,
We recommend and suggest to follow the total delivered costing package for next 3-6 months and then we will further review and add more steps based on the maturity and usage of SAP costing system.
Post successful implementation of SAP Costing system our team will support the costing department for next 3 months to hand hold and resolve the issues if any.

Assumptions:
The entire implementation would be done from Remote and all the meetings and discussion would be done through the ZOOM Calls

Business Deliverables:
Plan activity type price calculations for conversion cost
Standard cost calculations and update in material masters (Based on BOM and Routing)
Actual cost capturing at the production order level for RM Cost and Conversion cost
Month end closing for production order (Allocation of cost and Settlement of orders)
Reporting of variances and profitability reports.

Project Deliverables:
Business requirement documents (Based on questionnaire by our experts)
Business solution documents
Configuration documents
SIT (System Integration Testing) documents
UAT(User Acceptance Testing) documents
Functional and Technical Specifications
Training Manuals

Industry wise we have the costing processes pre-defined with us, we have standardized the regular requirements of the Business users w.r.t. the Costing module

Based on that we have the templates for the Questions, Configurations, Testing Scenarios and Checklist for Moving to Productions.

In case any specific requirement is there we have the provision to address that as well, however as per our experience 90 to 95 % of the requirements are routine only for all the costing users,

Infocost focus is to implement and improve the SAP costing, with delivery of business value from the solutions,
Infocost has successfully implemented and improved the costing system of more than 100+ companies
Based on our experience we have created package / products for Comprehensive costing, so all the key costing features can be delivered to business, even though some of them are not know to them as well.
Infocost’s approach for SAP Costing Implementations is fully automatic, and process driven for each of the small points and listed requirements.
Hence Infocost is having an edge over other big 4 consulting companies.

4 Weeks of Time required :
First week : Discussion + Questions Answers + Documents and Sign off
Second Week: Realization + Testing by Infocost team
Third Week : UAT + Training to Costing Team
Forth Week : Preparation for moving the TR to Production system

2 Weeks of Support (Free) post implementation

Support Required:
Dedicated team for this project to work closely with Consultants over the calls and testing purpose

This is very sensitive and high-risk item for any type of Industry and organizations, as the Costing information is being used for getting the new orders, Stock Audit for Banks , Advance Tax calculations and many MIS reports for decision making purpose, So the opportunity cost of this solution is very high. in order to estimate the opportunity, cost it would be 50 + Crore for the size of company with turnover 2000 to 5000 Cr.

One Month + 2 Resources (Working from Remote)

1. Start of the work
2. Business Solution Document
3. UAT Sign off
4. Final completions

INR 10,00,000/-

With 10L investment we can get benefits of more than 50 Crore