Integration of SAP PS & IM in the SAP System

Introduction

The integration of SAP Project System (PS) and Investment Management (IM) within the SAP system offers a streamlined approach to planning, distributing, and monitoring project budgets. This powerful combination enables organizations to manage their investment programs efficiently and align them with corporate strategies. 

Key Differences Between Customer Projects and Investment Projects Integration

When integrating SAP PS (Project System) and SAP IM (Investment Management), it is essential to understand the distinction between Customer Projects and Investment Projects:
 
Aspect Customer Projects Investment Projects
Purpose Revenue generation through external client services or products. Internal investments focused on asset creation or enhancement.
Budget Allocation Directly linked to customer contracts and billable tasks. Allocated based on internal investment plans and programs.
Cost Monitoring Revenue-driven with a focus on profitability. Cost-focused with emphasis on asset capitalization and budgeting.
Integration Approach Typically linked to sales and distribution processes. Integrated through investment programs and appropriation requests.

Understanding these differences is crucial for implementing the right approach when integrating SAP PS and IM in the SAP system.

Overview of SAP PS & IM Integration

The integration of SAP PS & IM in the SAP system allows companies to:
  • Plan, distribute, and monitor budgets for various projects.
  • Manage investment programs comprehensively, ensuring alignment with organizational goals.
  • Facilitate hierarchical cost planning and budget allocation.

Investment Programs in SAP IM

Investment programs in SAP Investment Management (IM) form the basis for the comprehensive planning and budgeting of costs related to a company's investment plans. These programs include:
  • Investment Program Definition: General specifications and default values for the entire program.
  • Hierarchically Arranged IM Program Positions: Structured positions that form a detailed plan for budgeting and monitoring.
Once an investment program structure is established, it can be used to plan costs hierarchically and allocate budgets effectively.

Investment Measures in SAP IM

Projects, maintenance orders, and internal orders that are assigned to investment program positions are known as investment measures. In SAP terminology, creating an Appropriation Request (AR) using transaction code IMA11 allows organizations to map project proposals, ideas, and other plans before their potential implementation.

Creating Variants Within Appropriation Requests

You can create variants within the Appropriation Request (AR) to explore different investment options. This flexibility ensures that companies can evaluate multiple scenarios before making final decisions.

Approval Process in SAP IM

Using status management and workflow, SAP IM supports a structured approval process for Appropriation Requests (AR). This workflow enables organizations to ensure proper validation and approval before proceeding with project implementation.

Once the AR is approved, it can be transferred to the Investment Measure. During this process:

  • Projects can be created using operative and standard WBS templates.
  • The project receives the master data from the AR, ensuring consistency and accuracy.

Planned Cost Roll-Up and Budgeting Process in SAP IM

After assigning the Appropriation Request (AR) and Investment Measure to their respective investment program positions, the planned costs can be rolled up to the relevant program positions using transaction code IM34.

Budgeting Process in Investment Management

1. Allocate Budget to Different Program Positions: This is the first step where budget distribution occurs at a higher level. 
2. Allocate Budget to Investment Measures (Projects): This step involves assigning budgets to specific projects or investment measures in SAP PS. 

The budgeting process is crucial for maintaining financial discipline and ensuring projects align with organizational investment goals.

Settlement of Investment Projects in SAP IM & PS

The settlement of Investment Projects involves transferring the costs incurred during the project to a fixed asset or other receivers.

Automatic Generation of Assets Under Construction (AUC)

  • When an investment profile is assigned to a WBS element, the system may automatically generate one or more Assets Under Construction (AUC) upon release of the WBS. 
  • Based on the requirements, different parts of the investment can be capitalized as Fixed Assets (FXA) or not.
This process ensures accurate tracking of costs and proper asset management within the SAP system.

Conclusion

The integration of SAP PS & IM offers a robust framework for budget planning, monitoring, and management of investment programs. Whether dealing with Customer Projects or Investment Projects, understanding the differences and leveraging the appropriate tools is essential for achieving financial and strategic objectives.

By using Appropriation Requests, status workflows, and effective budgeting processes, organizations can streamline their investment management processes and ensure successful project execution.

Frequently Asked Questions (FAQs)

1. What is the purpose of integrating SAP PS & IM?

The integration of SAP PS & IM enables organizations to effectively plan, distribute, and monitor budgets for investment programs and customer projects.

2. How do Customer Projects differ from Investment Projects in SAP?

Customer Projects focus on revenue generation, while Investment Projects are concerned with internal investments aimed at asset creation or enhancement.

3. What is an Appropriation Request (AR) in SAP IM?

An Appropriation Request (AR) is a formal request used to map project proposals, ideas, and plans before their implementation in the system.

4. How does budget allocation work in SAP IM?

Budget allocation involves distributing budgets to various program positions and then assigning them to Investment Measures such as projects or orders.

5. What is the role of Assets Under Construction (AUC) in SAP PS?

When a WBS element is released, the system can automatically generate an AUC, which is then capitalized as a Fixed Asset (FXA) when required.

6. How can I ensure proper approval of projects in SAP IM?

Using status and workflow management, organizations can implement structured approval processes for projects and investment measures.

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