COGS Report Customization Design for Profitability Analysis with ABAP List Viewer: Case Study of a Telecommunication Enterprise

Along with revenue, one of the necessary metrics in calculating gross profit for profitability analysis is Cost of Goods Sold (COGS). The objective of measuring profitability with gross profit is to reckon how efficient an enterprise manages the labors and supplies in carrying out the production process or services provision. In allocating COGS for product profitability analysis, Activity-Based Costing (ABC) is a costing technique that allows cost allocation based on the activities carried out in the production process. Companies from various industries have adopted ABC with available supporting tools like ERP system. This paper will discuss a case study of a telecommunications company in Indonesia that implements SAP S/4HANA for the cost allocation with ABC and profitability analysis processes. The company still faces shortcomings in its daily business operation, particularly profitability analysis reporting. The current COGS report for profitability analysis in the implemented system does not provide information about the source of the cost allocation, thus causing it hard to trace and further analyze the cost of activities contributing to the production of a product. Report customization can be a solution to accommodate the information needed. This research explains the designing of report customization with ABAP List Viewer (ALV) by applying iterative incremental model approach. Customization of the report reduces the steps needed to trace and analyze business process sources from the allocated COGS of a product to only one single step. The results presented in this paper may provide a solution for tracing cost allocation sources to analyze and determine the proper course of action regarding profitability and cost management.