Introduction to investment Management Module in SAP

Investment management refers to planning and managing of investments in long term activities. The long term investments may be for the purpose of creation of fixed assets for internal purposes, or may be an execution of job works and also investments in big projects. To manage these types of investments we should have a definite plan, budget and control over these types of investments.

The efficient management of long term investments will make the organization strong and highly solvent as well. Hence each Organization pays high priority attention to take care of such long term investments. Long term investment definitely draws attention of planning, budgeting and work flow as per predefined set parameters for the investment.

To accomplish such high priority attentions sap has evolved one component i.e. investment management module. This application component will take of all the requirements for efficient management of investments. In sap the investment module is cross functional module. It has linkup with the finance module and controlling as well. EX: If the investments made in fixed assets for the organization, it is linked to asset accounting module and internal order module.

Investment Management Module

To understand the investment module we must have idea about asset accounting, general ledger accounting, and internal orders also. In sap the investment management has 4 components.

  • Appropriation requests.
  • Investment programmes,
  • Investment as internal orders.
  • Investments as projects.

Appropriation Requests

The process of accepting the investment measures in advance to implement the programme. Generally investment management involves high cost and longer gestation period. For that we require approvals in advance for the investments. In the process of approvals management, different authorized people are involved. The configuration requirements for these processes are embedded in the appropriation request configurations.

Investment Programmes

A structured capital budget programmes for producing fixed assets and long term services are called investment programme. An Investment programme consists of different capital budget programmes. Definition of Investment programme is the back bone configuration of investment programme management.

Investments as internal order

A long term investment may sometimes consider as an internal orders. Generally in case of make to order type industries, this type of investment management will be considered. Some times in house production of fixed assets also can be considered as investment as internal orders. We have already dealt this topic while discussing internal order management Settlement transactions to AUC through internal orders. For this purpose we have to define investment profiles separately and asset class as investment measure.

investment management module

Investment as Projects 

When we are investing the funds for longer period and the scope of the Investment is also for high in volume such investment are called as separate projects. We have to treat such projects as separate module as project systems.

Investment Programme

The core component of configuration in investment programme is the definition of Investment programme type. However, if you want to define the investment programme type the following configurations are pre requisites.

  • Planner profile
  • Budget profile
  • Status profile.

We can define these profiles or we can use the system defaulted profiles.

Besides the above some other configurations are required to define the programme types.

  • Person responsible,
  • Reasons for investment,
  • Priority
  • Investment scope.

Also See: What is the difference between SAP Financials and SAP Controlling?

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