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Event Based Work in Process

The intent of this article is to cover the business process to updates work-in-process calculation, overhead calculation, and variance calculation by linking the posting to the events. The events can include items such as goods issues, activity confirmation, goods receipts, or other manual bookings on production orders in the make-to-stock and make-to-order scenarios.

Blog Applicability


Target Audience

Business Users, Key Users, Consultants,

Target Industry


Business Scenario

One of the activities in period end closing is to calculate the WIP, Variance and settle the WIP and variance to FI. In ECC world customer must perform period end closing mandatorily to calculate and post the WIP to FI for the manufacturing orders.

Customer must wait till month end to calculate and post the WIP. It also requires more time during month end closing, Due to this period end closing getting delayed.

Due to WIP calculation during the period end, high volume production order, process orders need to be processed, that leads to the performance issue during period end closing.

To over come this issue SAP S4HANA developed solution called Event Based Revenue Recognition. The even based revenue recognition solution calculate the WIP as and when occurrence of the production events such as goods issues, activity confirmation, goods receipts, or other manual bookings on production orders in the make-to-stock and make-to-order scenarios. In this article we are going to discuss about the WIP calculation and posting WIP to FI for make to stock scenario only.

The step by step process of Event Based WIP process explained below.

As a perquisite to calculate the Event Based WIP including the overhead, the cost sheet should be enabled with relevant for Event based, this setting will enable the Event Based WIP for overhead postings.

Configuration Steps for enabling event-based revenue WIP

Define Event Based RA key

WIP calculation method should be : WIP at Actual Costs. In addition to that WIP calculation and posting, actual variance categories can be enabled ( This scenario is not covered in this article, will be available in following EBRR -Blogs.

Define WIP Source:

The WIP source is grouping of cost based on category and mark relevant for WIP or not. Actual costs posted to the order should be included in the WIP calculation. If any of the cost not required to be included in the WIP, the source with assigned GL accounts should be set as costs not to be included.

Assign GL accounts

Each of the source, the required GL account should be assigned by selecting the sub folder assign GL accounts.

Creation of rules for Define WIP Account determination:

While posting the Event based WIP the financial posting requires GL. The GL account is determined based on the rule for define WIP account determination.

The GL account assigned in the node WIP account determination rule is used for FI Posting. In this sub folder there is option assign reserve ac as well.

The Event based WIP activated at the level of company code. The Company code assigned to the folder assign WIP account determination to company code.

Assign document type to Company codes

The RA key relevant for Event Based Revenue Recognition for the production order is assigned at the level order types (Define Order-Type-Dependent Parameters for Production Orders). (the RA key: RSEBW is assigned to order type)

Activity Confirmation to the production.

WIP Posting for the activity Cost: The Event Based WIP Posting.

Material issue to Production order ( two accounting document created while issue material to production order and also Event based WIP posted to FI )

Even Based Posting for material issue.

The similar way Overhead posting also post the Event based FI posting. It is not shown here.

Goods receipt for the Production order:

Event based posting at the time of GR for production order: The WIP posted during the Activity Posting and Good issue is revered at the time Good receipt from the production order.

Fiori App – Event Based Work in Process

Additional Learning

Reference FAQ Note: 2737228 - FAQ:SAP Product Costing: Event-Based Work in Process in S/4 HANA Cloud :



The outlined business contents in this blog is purely to leverage “Event based WIP calculation And all other related information