FICO Internal Orders Part 3: Settlement Profiles, Allocation Structures and Settlement
Settle orders correctly: settlement profile (allowed receivers, default rules), allocation structure (source cost elements → settlement cost elements), settlement rules per order, periodic vs full settlement, settlement to cost center, GL, asset or AuC, and troubleshooting failed settlements.
Explanation
📌 KEY POINTS
✅ Settlement profile defines allowed receivers, default settlement type and allocation structure.
✅ Allocation structure maps incoming cost elements to settlement cost elements.
✅ Settlement rules on each order name receivers and percentages (e.g. 60% CC1, 40% CC2).
✅ Periodic settlement runs monthly; investment orders often settle to AuC and finally to assets.
⚠️ Orders without settlement rules fail at month-end — enforce rules before release.
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▶ WHERE WE ARE
Part 2 covered budgets. Now settlement.
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▶ 1. SETTLEMENT PROFILE
- Receivers allowed, 100% validation, document type.
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▶ 2. ALLOCATION STRUCTURE
- Source → settlement cost element.
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▶ 3. SETTLEMENT RULES
- Receivers, percentages, validity.
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▶ 4. EXECUTION
- KO88 single, KO8G collective; test run.
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▶ 5. TROUBLESHOOTING
- Missing rule, receiver locked, cost element not in allocation structure.
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▶ STEP BY STEP
- Review settlement profile and allocation structure.
- Maintain a rule 60/40 on an order.
- Run KO88 in test, then update.
✅ CHECKPOINT: order balance zero after settlement.
Code example
===== CONFIG =====OKO7 settlement profile | OKO6 allocation structure (source cost elements → settlement cost element) ===== SETTLEMENT =====Order costs 20,000 → rule 60% CC 1000 / 40% CC 2000KO88 test → update: Cr order 20,000 | Dr CC1000 12,000 | Dr CC2000 8,000KO8G collective settlement (monthly job)Real project scenario
An engineering firm used investment orders but settled directly to assets instead of AuC during construction, depreciating incomplete assets. Settling to AuC until completion and then to final assets corrected valuation.
Common mistakes
- Missing rules.
- Wrong receivers.
- Incomplete allocation structure.
- No test run.
- Settling investment costs to final assets early.
Best practices
- Rules before release.
- Validate receivers.
- Complete allocation structures.
- Test first.
- AuC for investments.
Interview angle
Questions: "What is a settlement profile?", "What is an allocation structure?", "How do investment orders settle?"
Strong answer: profile, structure, rules, execution, troubleshooting.
Practice this lesson
Quick check
1. What does an allocation structure define in settlement?
2. An engineering firm settles investment orders directly to final assets during construction. What is the issue?
3. Month-end collective settlement fails for many orders. What is a common cause?
Interview questions
1. Suppose you inherit an existing Internal Orders solution. How would you review it before making a change?
Answer it in your own words first, then compare.
2. Month-end order settlement fails and investment costs appear on the wrong accounts. How do you fix settlement?
Answer it in your own words first, then compare.
Reference-verified: the steps are checked against official SAP documentation and tutorials, and object and field names in the sample code are checked for consistency. The code has not been compiled or run on an SAP system by ERPClimb. Syntax marked release-dependent varies by SAP release, so check it in your own system.