Standard product costs and intercompany relations are used to determine the global value network for all products sold. The quantity structures and cost contributions for the respective level are derived from the calculations. For better transparency, the costs are mapped to a global cost structure according to their origin. Using EXA GVC, you can map relations across system boundaries. On the basis of this quantity and cost structure, the costs are rolled up end to end for each material (material-plant combination), from the raw material through production to sales. The global cost structure therefore enables you to analyze group production costs for each material along the value chain. Furthermore, based on the integrated comparison against local costs, you can calculate and report the included intercompany profit at each level. EXA GVC also supports the calculation of group production costs in the context of make-to-order production.

  • Consolidated cost is based on standard costs

  • GVC uses weighted average approach to calculate cost

  • Option to consider opening inventories and the last valuation and include historical cost and FX impact

  • End-to-end value chain is determined based on intercompany relations and, if required, transaction data is leveraged to establish relations

  • Cost transparency at material level (for each material-plant combination including semi- finished materials), allowing you to drill down from group, company code, and plant to individual product

  • Cost component split tracking for all components is maintained in the underlying ERP systems along the value chain

  • Costs in local and group valuation

  • Option to also calculate/consider work in progress and stock in transit at product level

Intercompany profit is the profit made when one group entity sells to another entity of the same group (intercompany). The intercompany profit is generated at the selling entity and is the difference between the revenue and the local cost at this entity.

At the end of the reporting period, all intercompany (also unrealized) profit is calculated and rolled up along the value chain and is visible in every business process. For the consolidation process, the intercompany profits are mainly relevant in the following areas:

  • Profit in inventory: value of the intercompany profit for global materials that are held in stock in the various companies (in the financial value chain)
  • Profit on stock in transit: the intercompany profit for goods shipped but not yet received by the intercompany receiver needs to be considered from the inventory perspective for all materials traded between the companies
  • Profit on goods sold externally: the intercompany profit generated when goods are sold to the market

EXA GVC can be used to calculate UPI at any point of a value chain.

  • UPI can be tracked both in local and group currency

  • With its weighted average costing approach, you can track UPI at any point of the value chain

  • You can drill down on UPI from organization level to company code, to plant, and ultimately to product level

  • The approach in group currency not only considers the impact of historical FX rates, which is kept in the opening balance when converting from local added value to group currency, but also considers the historical cost of materials and activities

  • In comparison, the UPI in local currency only considers the impact of the historical cost

  • Option to also calculate/consider work in progress and stock in transit at product level

  • Display changes in the UPI between two periods using GVC