Introduction to Service Accounting

September 23, 2016 / Shayne Sabiniano / VLF-EU2

Agenda

Page 2

Service Accounting An Introduction

Service Accounting Transactions
Services
Reimbursement
Asset Sales
Transitory Items
Activity Split

Introduction to Service Accounting September 2016

What is Service Accounting?

Page 3

Introduction to Service Accounting September 2016

Service Accounting An Introduction

Service
Accounting

Page 4

Introduction to Service Accounting September 2016

Service Accounting

Service
Accounting

Page 5

Introduction to Service Accounting September 2016

Non-Core
Business
Transaction

Not attributable to the main

source of Income

Invoice

Involves issuing an Invoice or

other Billing Document

Sales and
Distribution
Module

Revenue account determination;

Cost of Sales assignment

Invoice
eXchange
Broker

For automatic posting on the

invoice receiving side

Purchase
Order

Connection, a valid and existing

PO Number are needed for IXB

WPA
Postings

Used to allocate costs to our SD

Orders

Services

Page 6

Introduction to Service Accounting September 2016

Services
Sale
of Services - Example
Rentals

Utilities

Consulting

Training

Scrap Sales Service

Page 7

Introduction to Service Accounting September 2016

Admi
n

Service Transaction

Service Provider
Company

Customer
Company

Customer
Company

Customer
Company

Page 8

Introduction to Service Accounting September 2016

Service Provider
Company

Service Transaction
Revenue posting on sales order item

Purchase
Order

Direct assignable costs from WPA Allocation

Sales Order

Corresponding costs are reported as Fixed

Manufacturing Costs
Settlement

Gross Sales with SI

210
WPA

during Closing

allocation

Account Assignment Group 21

CO-PA

Revenues: 60,000
COGS:
50,000

CC 50,000
VV002 (Gross Sales);
VV019 (Fixed Manufacturing Cost)

Costs
P 50,000

3020000 G/L Account

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Introduction to Service Accounting September 2016

Invoice

Training services P 60,000

Service Process Types

Services

Orderrelated
Billing

One-time
Billing

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Introduction to Service Accounting September 2016

Resourcerelated
Billing
Contract/
Recurring
Billing

Reimbursement

Page 11

Introduction to Service Accounting September 2016

Reimbursement
INVOICE

Bayer companies within same division

BAYER CUSTOMER
YES customers (exceptional
NO
External
cases) - damages
SAME

NOas functional costs)

SERVICE
No Cost
of
Sales
(remain
(BCS)
DIVISION

YES
Same
profit center in the receiving and sending
side

REIMBURSEMENT
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Introduction to Service Accounting September 2016

Internal Reimbursement of costs Example

Purchase
Order

Sales Order

Invoice

CO-PA
Gross Sales: 50.000

Costs

R&D
cost center

allocation

CO-PA

50.000

R&D costs : 50.000

SERVICE PROVIDER COMPANY

CUSTOMER COMPANY

Gross Sales 50,000

R&D costs 50,000

R&D costs 50,000

Profit Center RB00001204

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Introduction to Service Accounting September 2016

Reimbursement Process Types

Internal Reimbursements

Licenses, Royalties

Indent Commission

Government Grant

External Reimbursement

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Introduction to Service Accounting September 2016

Thank you!