SAP Project System - Real Estate & Construction Co

SAP Transaction Codes in Project System (PS) - Project

2008-11-09T04:30:00.000-08:00

As follows are the SAP standard transaction codes under Project in Project System Modules:

CJ20N - Project Builder

Project Planning Board

CJ27 - Create Project
CJ2B - Change Project
CJ2C - Display Project

Special Maintenance Functions

CJ2D - Create Project - Structure Planning
CJ20 - Change Project - Structure Planning
CJ2A - Display Project - Structure Planning
CJ01 - Create Work Breakdown Structure
CJ02 - Change Work Breakdown Structure
CJ03 - Display Work Breakdown Structure
CJ06 - Create Project Definition
CJ07 - Change Project Definition
CJ08 - Display Project Definition
CJ11 - Create Single WBS
CJ12 - Change Single WBS
CJ13 - Display Single WBS
CJSG - Generate WBS Element Group
KJH2 - Change WBS Element Group
KJH3 - Display WBS Element Group

OPUM - Subproject
CN21 - Create Network
CN22 - Change Network
CN23 - Display Network

Simulation

CJV1 - Create
CJV2 - Change
CJV3 - Display
CJV5 - Delete
CJV4 - Transfer Project
CJV7 - Logs
CJV6 - Administration Data
CM53 - Project Capacity Load Utilization
CM55 - Work Center Capacity Load Utilization
CM54 - Simulation

Project Version

CN72 - Create
CN71 - Create Using Structure Overview

Current Settings

OPS7 - Specify Applicants for WBS elements
OPS6 - Specify persons responsible for WBS elements

SAP Transaction Codes in Project System (PS) - Basic Data

2008-11-09T04:02:00.000-08:00

As follows are the SAP standard transaction codes under Basic Data in Project System Module:

Templates

CJ91 - Create Standard WBS
CJ92 - Change Standard WBS
CJ93 - Display Standard WBS
CN01 - Create Standard Network
CN02 - Change Standard Network
CN03 - Display Standard Network
CN98 - Delete Standard Network
CU41 - Create Configuration Profile
CU42 - Change Configuration Profile
CU43 - Display Configuration Profile
CA88 - Work Center (Replace Functions)
CA78 - Production Resources and Tools (Replace Functions)
CN99 - Archive
CN11 - Create Standard Milestone
CN12 - Change Standard Milestone
CN13 - Display Standard Milestone
CN08 - Edit Network Parameters from Sales Order
CN09 - Display Network Parameters from Sales Order
CKCM - Models for Easy Cost Planning

Master Data

CNR1 - Create Work Center Master Record
CNR2 - Change Work Center Master Record
CNR3 - Display Work Center Master Record
CR11 - Create Work Center Capacity
CR12 - Change Work Center Capacity
CR13 - Display Work Center Capacity
CR21 - Create Work Center Hierarchy
CR22 - Change Work Center Hierarchy
CR23 - Display Work Center Hierarchy
CR05 - Work Center List
CR06 - Cost Center Assignment
CR07 - Work Center Capacity
CR08 - Work Center Hierarchy
CR10 - Change Documents
CA83 - Work Center Where-Used Selection
CR15 - Capacity: Where-Used
KK01 - Create Statistical Key Figures
KK02 - Change Statistical Key Figures
KK03 - Display Statistical Key Figures
KAK2 - List Maintenance Statistical Key Figures
KAK3 - List Display Statistical Key Figures
MM01 - Create Material
MM02 - Change Material
MM03 - Display Material
IE01 - Create Equipment
IE02 - Change Equipment
IE03 - Display Equipment
CF01 - Create Production Resources and Tools
CF02 - Change Production Resources and Tools
CF03 - Display Production Resources and Tools

Work Breakdown Structure (WBS) - SAP Project System

2008-10-02T18:29:00.000-07:00

What is a Work Breakdown Structure (WBS).

A work breakdown structure (WBS) is a model of the work to be performed in a project organized in a hierarchical structure. Is WBS important and useful to Project Managers? Well, it's really very important and useful to them. WBS is an important tool which helps you keep an overview of the project: a) It forms the basis for organization and coordination in the project;
b) It shows the amount of work, the time required, and the costs involved in the project;
c) It is the functional basis for further planning steps in a project, such as process planning, cost
planning, scheduling, date and capacity planning, or costing, as well as project control.

The project structure can be represented according to different criteria:
1. By phase (logic-oriented)
2. By function (function-oriented)
3. By object (object-oriented)

WBS is one of the hierarchy in SAP Project System.

Want to Learn SAP Project System (PS)?

2008-09-05T07:19:00.000-07:00

Visit this site regularly to learn Project System in just 3 days. Knowledge of pool of PS experts will be posted here regularly. You can post your questions in PS in this site and will be attended and aswered regularly.

"New Revenue Recognition Challenge for the Real Estate Industry"

2008-09-05T07:16:00.000-07:00

Business (Philstar)Major change in revenue recognition for real estate companiesKPMG CORNER By Jose T. Valencia Tuesday, July 22, 2008

A new accounting interpretation will take effect on January 1, 2009 which will drastically affect the timing of the recognition of revenues of companies engaged in development and sale of real estate.

The construction of high rise office and residential condominium buildings has picked up over the last few years, spurred by the growth of business process outsourcing companies locating in the Philippines and OFWs investing in real estate in the country. In the financial statements, this shows up as higher revenues for real estate companies.

Presently, most companies recognize revenues from real estate development projects where sales are made prior to the completion of the project using the percentage of completion method. For instance, it is common to see units being sold before and during the construction of a residential condominium project (pre-completion sales). Typically, the buyer pays a deposit upon signing of the contract to sell and makes progress payments until the unit is completed and turned-over to the buyer. Under the percentage of completion method, revenue from pre-completion sales is recognized on basis of the completion of the physical proportion of the construction project. This means part of the revenue and the corresponding cost are being recognized in the profit and loss statement during the construction period, before the completion and turn-over of the units.

Under the new accounting interpretation, revenue from pre-completion sales will be recognized only when the unit is completed and delivered to the buyer. This is a significant change from present the practice which could have a major impact on the financial statements of companies in the real estate industry.

The new accounting interpretation is called IFRIC Interpretation 15, Agreements for the Construction of Real Estate. IFRIC 15 has not yet been formally adopted by the Philippine standard setting body; however, the new standard will become part of Philippine Financial Reporting Standards before the end of the year.

As the name suggests, IFRIC 15 applies to agreements for the construction of real estate and not to all types of real estate sales. IFRIC 15 addresses the timing of recognition of revenue from the construction of real estate and provides guidance on when the percentage of completion method may be applied and when the general rule on revenue recognition as provided in Philippine Accounting Standard 18, Revenue, should be followed.

Under IFRIC 15, the percentage of completion method may be applied when the contract meets the definition of a construction contract in that the buyer is able to specify major structural elements of the design of the real estate before construction begins and/or specify major structural changes once construction is in progress. The percentage of completion is also applied for agreements in which the company transfers to the buyer control and significant risks and rewards of ownership of the work in progress in its current state as construction progresses ('continuous transfer').

The foregoing scenarios, in which the use of the percentage of completion method for recognizing revenue is allowed, may not be present in a typical residential condominium project. Generally, the buyer is in no position to specify major structural changes and the transfer of control and significant risks and rewards of ownership occurs upon the turn-over of the unit to the buyer. Accordingly, for a typical residential condominium project, revenues from sale of units can only be recognized when the project is completed.

IFRIC 15 is effective for annual periods beginning on or after January 1, 2009. Earlier application is permitted and the change in accounting policy shall be applied retrospectively. For companies with interim reporting, the change in accounting policy will have to be applied to interim periods in 2009. For listed companies, this change in accounting policy will also require the restatement of December 31, 2006 balance sheet, the 2007 income statement and cash flow statement, and the 2008 financial statements.

IFRIC 15 changes the timing of revenue recognition only for financial reporting purposes. As such, there should be no change in the cash flows of a real estate company as a result of the change in accounting policy or in the tax reporting practices. Accordingly, from a shareholder value point of view, the change in accounting policy theoretically should have no impact on the value of a company.
IFRIC 15 however may have an effect on the ability of a company to maintain its dividend policy. The change in policy will likely result in a reduction in retained earnings and reduced retained earnings may result in reduced dividends. It is also possible that the adjustment in retained earnings (as a result of the retrospective application of the change in accounting policy) could wipe out the company's retained earnings or even result in a negative retained earnings or a deficit.

In view of the possible adverse and significant effects of IFRIC 15 on the financial statements of real estate companies, on their revenues, their net income and their dividend policies, it would be prudent for the management of these companies to undertake a study as soon as possible to determine precisely the effects of the new policy on current and prior year financial statements. If business plans have already been prepared for 2009, the projected financial statements may have to be revised. Changes in monthly or quarterly management reporting may be also necessary. In addition, management incentive plans may also have to be revisited.

"SAP Project System"

2008-09-05T07:07:00.000-07:00

Purpose
Both large scale projects, such as building a factory, and small-scale projects, such as organizing a trade fair, require precise planning of the many detailed activities involved. The project manager has the job of ensuring that the project is executed efficiently, on time, and within budget - which he or she achieves by ensuring that the required resources and funds are available as and when needed.Projects are generally part of the internal processes of a company. To be able to control all tasks in project execution, you need an organizational form that is specific to the project and which is shared by all departments involved. Before you can carry out a project in its entirety, the project goals must be precisely described and the project activities to be carried out must be structured. A clear, unambiguous project structure is the basis for successful project planning, monitoring, and control.

You structure your project per the following points of view:·
By structures, using a work breakdown structure (WBS)·
By process, using individual activities (work packages)

Project managers usually distinguish between two types of project:
a. Externally financed projects
b. Customer projects
c. Internally financed projects
d. Overhead cost projects
e. Capital investment projects

Integration
The high degree of integration between the Project System (PS) and other application components means that you can plan, execute, and account for projects as part of your normal commercial procedures. This means the Project System has constant access to data in all the departments involved in the project.

Features
The Project System guarantees close and constant monitoring of all aspects of your project.This includes both technical and commercial aspects of the project.