Insights
Capex planning in SAP Analytics Cloud: from request to depreciation
Capital expenditure is rarely planned in a single step. Between the idea in the business department and the depreciation in P&L planning lie the request, review, approval and budget release. How this path can be mapped in one model.
Where capex planning falls short today
In many companies, capex planning lives in a separate list. Project managers submit projects by file, and controlling collects them, reviews them and manually works the follow-up costs into P&L planning. When a project changes, every one of these places has to be updated.
The more figures interlock, the more expensive this becomes. In capex controlling, investments, budgets, personnel costs and non-personnel costs depend on one another. If one of them shifts, the rest shifts too.
The path of a project in the model
Submission
The project manager creates the project in an input form: purpose, amount, period, cost centre. Validation rules apply at the point of entry, not only once it reaches controlling.
Review and approval
Approval runs as a task in the planning calendar, with a reviewer and a deadline. Until it is approved, the project stays in a version of its own and does not yet flow into anyone else's planning.
Budget release and actuals
After approval, the budget is released. Actuals are loaded from the ERP into the same model, and plan, approval and release sit side by side, down to the individual project.
Follow-up costs and depreciation
From the amount and the useful life, a data action calculates the depreciation and writes it to P&L planning. Follow-up costs such as maintenance or personnel are added. When the project changes, P&L planning recalculates with it, without anyone touching a second list.
What controlling gains
- One version of the figures for everyone. Project managers, controlling and management see the same figures, each in their own view.
- Traceability. Who changed and approved what, and when, is recorded in the system, not in an email.
- The impact on the result. A postponed investment immediately shows what it means for depreciation and budget.
Where we know this from
A planning solution in the capex controlling of a DAX-listed automotive group started with exactly this building block. The planned projects ran into the hundreds of millions, with hundreds of participants. The local solution became the standard for the planning processes concerned. How that came about is described in the reference project.
Capex planning can be started on its own and later extended to financial planning, personnel and reporting. The building blocks are listed on the SAP Analytics Cloud page.
Is your capex planning still run on lists? We will take a look at the process.