Handling contractor over-hours and SES exceeding PO quantity in SAP S/4HANA Public Cloud

[BarboraBaka]

Hello everyone,

we are using SAP S/4HANA Public Cloud with external contractors who record their working hours through the Manage My Timesheet application. Each approved timesheet entry automatically creates a Service Entry Sheet, and supplier invoices are then matched to the related purchase order.

In practice, contractors sometimes record more hours than the purchase order quantity allows. These additional hours must remain visible for our customer project billing, as we invoice clients based on all recorded time. However, these extra hours should not create additional Service Entry Sheets or cost postings for vendor invoicing beyond the approved purchase order quantity.

As a result, we encounter several issues:

• The total service quantity in SES exceeds the ordered amount.

• A large number of micro-SES entries are created, which makes invoice matching and reconciliation very time-consuming.

• The excess SES remain posted to cost accounts and require manual clearing.

• This slows down supplier invoice processing and increases administrative workload.

We would like to know if there is a supported configuration or standard process in SAP S/4HANA Public Cloud that would allow contractors to record all hours in Manage My Timesheet for customer project billing, while limiting SES creation and cost postings for vendor invoicing to the approved purchase order quantity — keeping any excess hours visible only for reporting purposes without accounting impact.

Any guidance, best practices, or SAP Notes addressing this scenario would be very much appreciated.

Thank you!

Barbora 

[Chris1973]

Good day @BarboraBaka 

Thank you for your question.

Have a look at these references, they provide more detailed guidance:

Procurement of Services: Basic Process, External Procurement, Procurement of Service Items,

Manage My Timesheet, SES, Implementing Time Management in SAP SuccessFactors, SAP Fieldglass Release.

In summary, the timesheet SES integration is a fully automated and auditable process. There is no standard public cloud configuration that allows you to record time without SES creation or cost impact. The aim is to ensure visibility for customer billing and processing for vendor invoice.

However, in your dual visibility requirement, there are a few options you can evaluate.

1. Use limit-based service PO Items (my recommendation). Which focuses on you creating service POs through Item Category D – Limit rather than fixed-quantity service items. Here you should define Expected and Overall limits to cap SES posting while allowing all hours to remain visible in reports.
2. Separate Project Billing Time from Vendor Invoice Flow. Here you need to capture all hours for billing visibility but restrict SES creation to approved vendor quantities.
3. Ensure you set your PO tolerance to 0% by hard blocking any SES posting beyond PO quantity while you retain visibility in the timesheet and reporting layers.

These approaches maintain full transparency for customer billing and accurate procurement accounting without you having to develop custom solutions.

Let me know if you have further questions.

Best regards

Chris