the value of group valuation for intercompany subcontracting is not correct

[LJ8]

Hi, Guru,

We are encountering one issue regarding intercompany subcontracting and group valuation. We found that the output result of the group valuation is not correct for the intercompany subcontracting transactions. Here is the business scenario.
Company code A and company code B are manufacturing companies. Company C is a trading company. All these three companies are individual legal entities within one corporation group.
Company B issues subcontracting purchase orders to company A to produce finished products. The raw materials and packaging materials are provided from company B to company A as free of charge materials.
Company A produces the products with the raw materials and packaging materials that are provided by company B. So, the cost in the production orders is activity cost only (e.g., labor cost, depreciation cost, and other overhead cost, etc.)
Once the production orders are completed, the products are received in warehouse by goods receipt by company A. Subsequently company A issues goods to company B and issues billing documents to company B as the subcontracting service fee (manufacturing overhead cost, plus markup).
Company B posts good receipts against the subcontracting purchase orders and post invoice verification as well.
Company C issues intercompany STO to company B. Company B posts goods issue against the STO and issues the billing documents based the delivery notes from the STO. Consequently, the goods receipt and invoice verification are posted automatically in company C.
However, we found that even though the above scenario is the standard process that can be managed by the SAP system, the group valuation from company B and company C cannot reflect the activity cost components from company A. Rather than that, the cost components from company A displayed in company B or C is the subcontracting fee. That means the cost from the group valuation perspective is higher than the actual cost.
So, we are wondering if the group valuation can manage the scenario of intercompany subcontracting process? Is there a notes that we can implement to realize the group valuation for intercompany subcontracting business?

Looking forward your feedback

Liu Jun