Difference between WBS Element & Internal Order

[#1]

<b>Dear Sap Guru's

Can someone throw some light on the differences between WBS Element & Internal Order?

Regards,

Amit</b>

[Former Member]

Hi Amit,

To understand the difference between WBS Element & Internal Order, i shall take them one after the other.

To understand WBS elements, you need to understand the concept of <b>Project</b>.

<b>Project Definition</b> is the framework within which objects are grouped.

It provides the basis for the Work Breakdown Structure(WBS).

In principle Project Definition refers to a single Production Area or License Block

Objects could be sub-projects, phases of a project, distribution of activities, materials, services, general cost elements, etc.

Projects have a start and a finish date whether long term or short term.

<b>WBS</b> is the hierarchical model of the tasks to be performed in the project. It represents the sub-division of work into manageable components which can be budgeted, planned and controlled.

WBS is the operative basis for the further steps in project planning, e.g. cost planning, scheduling, capacity planning as well as project controlling.

WBS can be organized according to phases, according to functions/processes or according to objects (execution projects).

<b>Networks and Activities</b>

A network represents the process in a project or in a task in logical sequence, and is the basis for detail scheduling.

<b>Networks</b> are made up of two main components: <b>Activities</b> and <b>Relationships</b>.

Through the use of activities, a network represents the flow of a project. Activities are the starting point for planning, analysis and specification.

Networks are also used to generate requisitions of material and services.

On the other hand,

<b>Internal Order</b>

Is an instrument used to monitor costs and, in some instances, the revenues of an organization.

Internal orders can be used for the following purposes:

1. Monitoring the costs of short-term jobs

2. Monitoring the costs and revenues of a specific service

3. Ongoing cost control

Internal orders are divided into the following categories:

1. <b>Overhead orders</b> - For short-term monitoring of the indirect costs arising from jobs. They can also be used for continuous monitoring of subareas of indirect costs. Overhead orders can collect plan and actual costs independently of organizational cost center structures and business processes, enabling continous cost control in the enterprise.

2. <b>Investment orders</b> - Monitor investment costs that can be capitalized and settled to fixed assets.

3. <b>Accrual orders</b> - Monitor period-based accrual between expenses posted in Financial Accounting and accrual costs in Controlling.

4. <b>Orders with revenues</b> - Monitor the costs and revenues arising from activities for partners outside the organization, or from activities not belonging to the core business of the organization.

I hope the above helps.

Do not forget to award the points please.

Regards,

Jacob

[Former Member]

Please visit the following link

http://www.sap-img.com/project/what-is-wbs-element.htm

An internal order is used to accumulate cost for a specific project or task for a specific time period. An internal order is therefore used for a short period with a specific deadline.

Your internal order will usually settle to cost centers (and not visa versa) according to the settlement rule in the order setup.

An internal order can therefore be used to group all the expenses incurred to plan and hold a conference over a 3 month period. The order can be settled on a monthly basis to cost centers

Internal orders can also be used as "statistical" orders. This is also specified in the setup of the order. You do not have to settle statistical orders. When posting costs, you will post to the cost center and the order simultaneously. Both have to be specified when posting journals or purchase orders against statistical orders

Hope this will help you

[Former Member]

<b>Dear Muhammad Siddique,

The explaination was very helpful. i am into CRM and while making marketing plan we make campaign elements (WBS elements ) which are short term activities like "dealer meet" and try to monitor the expenses made to it. we also apply settlement rule to each wbs element by specifying the cost centres and the percentage allocated to each cost centre depending on the products.

So this is the reason why I think there is no difference between I.O and WBS Element. i hope my question is more refined now. Kindly please throw some light on some significant differences if possible.

Regards,

Amit</b>

[Former Member]

WBS Element & Internal Orders both are CO objects. They can be used for statistical as well as real postings. WBS elements are mainly used to monitor capital expenses although it can be used for revenue postings as well. Same is the case with internal orders.

As regards postings are concerned WBS elements have precedence over internal order i.e. while posting a transaction, if real WBS element as well as real internal order is given, real postings will happen on WBS.

Regards

Rakesh Pawaskar