The document provides an overview of SAP's CO (Controlling) module, which handles managerial accounting functions. It discusses the organizational structure in CO including operating concerns, controlling areas, and cost centers. It also defines important CO concepts like cost elements, cost center accounting, activity-based costing, product cost controlling, and profitability analysis. Key points covered include how controlling areas relate to company codes, the components of controlling, and how to define number ranges and cost elements in CO.
Set up and utilize internal orders as standard SAP functionalityJohn Jordan
Internal orders are an often overlooked part of standard controlling functionality. They offer broad and detailed functionality ranging from planning and budgeting' to cost and revenue analysis. Some key points:
*Internal order configuration basics for statistical orders
*Usage of statistical internal orders
*Standard reporting options for internal orders
*Using internal order hierarchies to support reporting for groups of orders
*Leveraging internal orders for planning
Gain a clear understanding of how you can utilize internal orders, and a better understanding of how to track costs and revenues for a specific job, service, task, or event.
Controlling 2012 Systematic Guidelines for Reconciling CO-PA to the General L...John Jordan
In this presentation, you will learn how to overcome one of the most common frustrations with CO-PA – the inability to easily reconcile it with the SAP General Ledger. We’ll cover:
1. Overview of costing & accounting-based CO-PA, including ways that data flows into CO-PA
2. Demonstration of how and why costing-based CO-PA ties to the SAP General Ledger
3. Tips for matching the cost-of-sales G/L account with its corresponding value field
4. Additional CO-PA reconciliation issues to be on the lookout for
5. Options for reposting documents in CO-PA only
Get instructions for synchronizing the data flows in CO-PA with the SAP General Ledger and best practices for easily analyzing and fixing reconciliation issues.
Commitment Management in SAP tracks future commitments against cost objects; this enables users to make a realistic comparison of actual cost plus committed cost against plan / budget on that cost object. Commitments are made when user creates purchasing document to purchase goods or services at a future date. Comparing actual against budget is misleading unless you factor in the outstanding commitments that will convert to actual cost in the future.
Blogs on www.veritysolutions.com.au
Enhancement Packages 5 & 6 – Where to find the business functions that matter...John Jordan
When SAP introduced the concept of enhancement packages and packaged functionality in business functions, administrators were relieved that they would not have to test everything when they upgraded. However, it made some business functions difficult to locate.
In this session from Controlling 2014, Janet Salmon dives into hard to find functionality important to Controllers including:
1. FIN_CO_COGM: Parallel valuation of cost of goods manufactured allows for different costing approaches for each accounting principle your company follows
2. LOG_MM_SIT: Actual costing and stock in transit allows you to pass production variances to other plants, even if they are assigned to other company codes
3. LOG_EAM_OLC: Operation level costing provides a more detailed view of your service and maintenance costs
4. FIN_CO_CCMGMT: New user interfaces for cost center, order and activity type master data and first planning applications
5. FIN_CO_CCPLAN and FIN_CO_ORPLAN: New user interfaces for cost center planning, order planning, and project planning
Leave this session with the ability to go back to the office and quickly identify and use the business functions that benefit you.
New gl functionality_by_guntupalli_hari_krishna_Hari Krishna
SAP NUEVO LIBRO MAYOR,SAP NEW دفتر الأستاذ العام,SAP新总账,SAP neue Hauptbuch,एसएपी नई सामान्य खाता,எஸ்ஏபி புதிய பொது லெட்ஜர்,SAP NEW総勘定元帳,SAP의 새로운 원장,SAP General Ledger НОВЫЙ,SAP NUEVO LIBRO MAYOR,SAP NEW GENERAL LEDGER
Blogs on Document Splitting at www.veritysolutions.com.au
Document Splitting is a very powerful feature delivered by SAP ECC.
Previous to SAP ECC, if new fields were required to General Ledger SAP had to deliver these new fields in Special Purpose Ledger tables. Profit Centre Accounting in R3 was Special Purpose Ledger table 8*, Joint Venture Accounting was ledger 4*. This essentially meant that data had to be copied from General Ledger table GLT0 to special ledger tables so these could be reported upon. However, technical glitches in code and incorrect usage of functionalities caused imbalances between the main ledger GLT0 and the special purpose ledgers.
SAP customers who wanted to expand the functionality of General Ledger to cater to special business requirements (like reporting General Ledger with another fiscal year variant) had to create custom Special Purpose Ledger tables. For example, if a customer wanted to report by two fiscal year variants, they could report one variant using General Ledger and the other variant using Special Purpose Ledger.
All this disparate ledgers reported the same source information in different views. Customers had to execute several month end jobs to ensure synchronisation of data across all these ledgers. Differences in balances and information between ledgers led to delays in month end close and reporting.
With SAP ECC new GL, SAP Customers can add new fields (which SAP calls “scenarios”) into General Ledger. This allows customers to perform, for example, Profit Centre Accounting and Reporting within General Ledger.
With SAP ECC new GL, SAP Customers can add new ledgers (which SAP calls “parallel accounting”) into General Ledger. This allows customers to report, for example, the same General Ledger data in multiple fiscal year variants.
This replication of data happens in real-time. SAP customers no longer need to execute month end jobs to synchronise data between different ledgers.
SAP Accounting powered by SAP HANA – Moving controlling and finance closer to...John Jordan
New users have traditionally struggled to understand the way SAP separates Financial Accounting and Management Accounting where most legacy systems see the two as one. While it’s easy enough to understand how a payroll account flows from the profit and loss statement into cost center accounting because the account information stays the same, the situation becomes more challenging as a revenue account flows into profitability analysis and is transformed into a value field, or a cost of goods sold account becomes multiple value fields depending on the cost components involved. In its latest product release, SAP is bringing the two worlds closer together. In this session we’ll look at how SAP is addressing these issues with its new product SAP Accounting powered by SAP HANA, part of SAP Simple Finance. This presentation will delve into how the requirements for internal and external reporting are converging and how this convergence impacts SAP Controlling.
This session will cover:
*Changes to report revenue and cost of goods sold by the CO-PA dimensions and how break out the cost of goods sold into multiple accounts
*How overhead is captured and allocated either from cost centers to CO-PA dimensions (assessment) or from high-level to lower-level CO-PA dimensions (top-down distribution)
*The underlying architecture and how FI and CO line items are linked.
*New reports that visualize the transformation of expense into cost of goods sold, work in process, and assets under construction
*How the period close process has been accelerated in SAP Controlling
Get a sneak peak at the first planning applications that allow you to plan costs according to the new paradigm of SAP Simple Finance, where the account is the leading dimension for all accounting activities.
Set up and utilize internal orders as standard SAP functionalityJohn Jordan
Internal orders are an often overlooked part of standard controlling functionality. They offer broad and detailed functionality ranging from planning and budgeting' to cost and revenue analysis. Some key points:
*Internal order configuration basics for statistical orders
*Usage of statistical internal orders
*Standard reporting options for internal orders
*Using internal order hierarchies to support reporting for groups of orders
*Leveraging internal orders for planning
Gain a clear understanding of how you can utilize internal orders, and a better understanding of how to track costs and revenues for a specific job, service, task, or event.
Controlling 2012 Systematic Guidelines for Reconciling CO-PA to the General L...John Jordan
In this presentation, you will learn how to overcome one of the most common frustrations with CO-PA – the inability to easily reconcile it with the SAP General Ledger. We’ll cover:
1. Overview of costing & accounting-based CO-PA, including ways that data flows into CO-PA
2. Demonstration of how and why costing-based CO-PA ties to the SAP General Ledger
3. Tips for matching the cost-of-sales G/L account with its corresponding value field
4. Additional CO-PA reconciliation issues to be on the lookout for
5. Options for reposting documents in CO-PA only
Get instructions for synchronizing the data flows in CO-PA with the SAP General Ledger and best practices for easily analyzing and fixing reconciliation issues.
Commitment Management in SAP tracks future commitments against cost objects; this enables users to make a realistic comparison of actual cost plus committed cost against plan / budget on that cost object. Commitments are made when user creates purchasing document to purchase goods or services at a future date. Comparing actual against budget is misleading unless you factor in the outstanding commitments that will convert to actual cost in the future.
Blogs on www.veritysolutions.com.au
Enhancement Packages 5 & 6 – Where to find the business functions that matter...John Jordan
When SAP introduced the concept of enhancement packages and packaged functionality in business functions, administrators were relieved that they would not have to test everything when they upgraded. However, it made some business functions difficult to locate.
In this session from Controlling 2014, Janet Salmon dives into hard to find functionality important to Controllers including:
1. FIN_CO_COGM: Parallel valuation of cost of goods manufactured allows for different costing approaches for each accounting principle your company follows
2. LOG_MM_SIT: Actual costing and stock in transit allows you to pass production variances to other plants, even if they are assigned to other company codes
3. LOG_EAM_OLC: Operation level costing provides a more detailed view of your service and maintenance costs
4. FIN_CO_CCMGMT: New user interfaces for cost center, order and activity type master data and first planning applications
5. FIN_CO_CCPLAN and FIN_CO_ORPLAN: New user interfaces for cost center planning, order planning, and project planning
Leave this session with the ability to go back to the office and quickly identify and use the business functions that benefit you.
New gl functionality_by_guntupalli_hari_krishna_Hari Krishna
SAP NUEVO LIBRO MAYOR,SAP NEW دفتر الأستاذ العام,SAP新总账,SAP neue Hauptbuch,एसएपी नई सामान्य खाता,எஸ்ஏபி புதிய பொது லெட்ஜர்,SAP NEW総勘定元帳,SAP의 새로운 원장,SAP General Ledger НОВЫЙ,SAP NUEVO LIBRO MAYOR,SAP NEW GENERAL LEDGER
Blogs on Document Splitting at www.veritysolutions.com.au
Document Splitting is a very powerful feature delivered by SAP ECC.
Previous to SAP ECC, if new fields were required to General Ledger SAP had to deliver these new fields in Special Purpose Ledger tables. Profit Centre Accounting in R3 was Special Purpose Ledger table 8*, Joint Venture Accounting was ledger 4*. This essentially meant that data had to be copied from General Ledger table GLT0 to special ledger tables so these could be reported upon. However, technical glitches in code and incorrect usage of functionalities caused imbalances between the main ledger GLT0 and the special purpose ledgers.
SAP customers who wanted to expand the functionality of General Ledger to cater to special business requirements (like reporting General Ledger with another fiscal year variant) had to create custom Special Purpose Ledger tables. For example, if a customer wanted to report by two fiscal year variants, they could report one variant using General Ledger and the other variant using Special Purpose Ledger.
All this disparate ledgers reported the same source information in different views. Customers had to execute several month end jobs to ensure synchronisation of data across all these ledgers. Differences in balances and information between ledgers led to delays in month end close and reporting.
With SAP ECC new GL, SAP Customers can add new fields (which SAP calls “scenarios”) into General Ledger. This allows customers to perform, for example, Profit Centre Accounting and Reporting within General Ledger.
With SAP ECC new GL, SAP Customers can add new ledgers (which SAP calls “parallel accounting”) into General Ledger. This allows customers to report, for example, the same General Ledger data in multiple fiscal year variants.
This replication of data happens in real-time. SAP customers no longer need to execute month end jobs to synchronise data between different ledgers.
SAP Accounting powered by SAP HANA – Moving controlling and finance closer to...John Jordan
New users have traditionally struggled to understand the way SAP separates Financial Accounting and Management Accounting where most legacy systems see the two as one. While it’s easy enough to understand how a payroll account flows from the profit and loss statement into cost center accounting because the account information stays the same, the situation becomes more challenging as a revenue account flows into profitability analysis and is transformed into a value field, or a cost of goods sold account becomes multiple value fields depending on the cost components involved. In its latest product release, SAP is bringing the two worlds closer together. In this session we’ll look at how SAP is addressing these issues with its new product SAP Accounting powered by SAP HANA, part of SAP Simple Finance. This presentation will delve into how the requirements for internal and external reporting are converging and how this convergence impacts SAP Controlling.
This session will cover:
*Changes to report revenue and cost of goods sold by the CO-PA dimensions and how break out the cost of goods sold into multiple accounts
*How overhead is captured and allocated either from cost centers to CO-PA dimensions (assessment) or from high-level to lower-level CO-PA dimensions (top-down distribution)
*The underlying architecture and how FI and CO line items are linked.
*New reports that visualize the transformation of expense into cost of goods sold, work in process, and assets under construction
*How the period close process has been accelerated in SAP Controlling
Get a sneak peak at the first planning applications that allow you to plan costs according to the new paradigm of SAP Simple Finance, where the account is the leading dimension for all accounting activities.
SAP Controlling area Common issue. This issue you face while posting the F-02 transaction for the first time in your company code in the higher EHP versions.
Lecture 3Introduction to SAP Controlling (CO)FIN419 .docxsmile790243
Lecture 3
Introduction to SAP Controlling (CO)
FIN419
Learning Objectives
Understand the goal of SAP Controlling (CO)
Understand the purpose, master data and reporting of CCA
Understand the purpose, master data and reporting of PCA
Understand the purpose, master data and reporting of Internal orders
Understand the purpose, master data and reporting of Product Costing
Understand the purpose, master data and reporting of Profitability Analysis
Understand the integration of CO and FI
2
SAP Controlling (CO)
Goal
The purpose of the Controlling (CO) module in SAP is to provide organizations with a method of slicing and dicing data to view costs from an internal management perspective and provide a view of profitability beyond that of basic financial reporting.
Controlling allows an organization to plan and track overhead costs within the company's specific organizational structure.
Standard reports include:
Cost center performance
Profit center performance
Budget analysis
Goal
3
SAP Controlling (CO)
Organizational Structure
Client
An independent environment in the system
Company Code
Represents an independent legal accounting unit
Balanced set of books, as required by law, are prepared at this level
A client may have more than one company code
Controlling Area
The controlling area identifies a self-contained organizational structure for which costs and revenues can be managed and allocated.
May contain one or more company codes, which can operate in different currencies.
Company codes within a controlling area must all use the same operational chart of accounts and fiscal year variant
Represents the legal and/or organizational views of an enterprise and it forms a framework that supports the activities of a business in the manner desired by management
Org
SAP Controlling (CO)
Organizational Structure (Cont)
Operating Concern
It represents an organizational unit in your company for which the sales market data has a uniform structure (characteristics/dimensions)
It is the valuation level for profitability analysis (CO_PA)
Multiple controlling areas can be assigned to one operating concern
Plant
The plant represents a production unit and is the central organizational unit in Materials Management and Production Planning.
A plant is assigned to a company code.
Cost Center Hierarchy
It is a tree structure representing all the cost centers belonging to a controlling area from a controlling perspective
Profit Center Hierarchy
It is a tree structure representing all the profit centers belonging to a controlling area from a controlling perspective
Org
SAP Controlling (CO)
Controlling Area and Currencies
By assigning more than one company code to a controlling area you can perform cost accounting for all company codes
The controlling area and company codes can have different currencies
The currency of the controlling area can be the same as that for a company code or different from all the company codes assigned to the controll ...
Account-based COPA is also called a hybrid of general ledger and costing-based COPA. In Account based COPA, you can get a report that is reconciled and consistent with financial accounting. Sales, markeitng and product management details can be obtained from it.
More Information:
https://flevy.com/browse/business-document/business-case-template-excel-683
DOCUMENT DESCRIPTION
For individuals who are fairly new at developing business cases, the Business Case Template Excel file provides a step-by-step methodology for developing a high level business case.
This Template Excel is also a companion document of the "How to Develop a Business Case" presentation which guide business leaders make investment decisions by helping them understand the financial impact of those decisions throughout the planning stage of a project to help justify a strategic direction and operating strategy
This Excel template includes the following sections:
- Instruction Guide
- Step 1. Input Variables
- Step 2. Generate Baseline Data
- Step 3. Input Benefit Estimate
- Step 4. Review Benefit Calc
- Step 5. Enter Investment
- Step 6. Review Cap Ex
- Step 7. Review Cash Flow Result
- Step 8. What-If Analysis
- Financial Summary
- Example Charts
Got a question about the product? Email us at support@flevy.com or ask the author directly by using the form to the right. If you cannot view the preview above this document description, go here to view the large preview instead.
Q.2 steps required to implement ABC within the companyABC Costing .pdfanjalipub
Q.2 steps required to implement ABC within the company
ABC Costing is a supplemental method of cost accounting that provides the decision-making
information absent from traditional costing methods. While ABC costing is not limited by
business unit boundaries, it can not fully supplant traditional costing methods as it often fails to
meet financial reporting requirements for businesses.
ABC Costing focuses on costs contributing to production of a product. It does not attribute other
general costs that do not have at least an indirect relationship to the product. While traditional
costing systems focus on direct costs and burden a product with other fixed costs, activity based
costing increases accuracy of indirect cost assignment.
In their 1999 book, Managerial Accounting, Garrison and Noreen identify six core steps to ABC
costing implementation.*
Implementation Steps
Step #1: Activity Identification
First, activities must be identified and grouped together in activity pools. Activity pools are the
supporting activities that tie in to a product line or service These pools or buckets may include
fractionally assigned costs of supporting activities to individual products as appropriate during
the second step.
Step #2: Activity Analysis
ABC continues with activity analysis, clearly identifying the processes which support a product
and avoiding some of the systemic inaccuracies of traditional costing. ABC costing requires
activity analysis, similar to the process mapping found in lean manufacturing.
This activity analysis identifies indirect cost relationships and allows assignment of some
percentage of that activity to an end product directly.
Step #3: Assignment of Costs
Based on the findings of step #1 and #2, costs are assigned to an activity pool. For example,
human resources costs would be assigned to indirect administrative or indirect management
costs. These pools will each have some contribution to object cost.
Step #4: Calculate Activity Rates
Initial analysis may include direct labor hours, or indirect support labor. These activities must be
assigned a value in real currency. All weightings must be added at this step. For instance,
production labor hours should be in terms of a weighted labor rate including benefit costs.
Step #5: Assign Costs to Cost Objects
Once activity costs, pools and rates are identified and clearly defined, the next step is to assign
them to cost objects. Objects are generally defined as the results offered to a customer. In both
manufacturing and non-manufacturing environments, this product should have some saleable
value to compare to the assigned costs.
Step #6: Prepare and Distribute Management Reports
Once ABC costing analysis is complete, that cost data should be placed in a concise and coherent
manner for cost object and process owners. This communication of the costing analysis is critical
to justify the cost of the analysis, as often this is not an inconsequential cost.
Q.3our classifications of the ABC .
SAP FICO General Ledger EndUser Training | www.sapdocs.infosapdocs. info
You can download this material from http://sapdocs.info/sap/fico/download-sap-general-ledger-accounting-enduser-training-ppt-material/
Get more SAP Materials from http://sapdocs.info/sap/
Synthetic Fiber Construction in lab .pptxPavel ( NSTU)
Synthetic fiber production is a fascinating and complex field that blends chemistry, engineering, and environmental science. By understanding these aspects, students can gain a comprehensive view of synthetic fiber production, its impact on society and the environment, and the potential for future innovations. Synthetic fibers play a crucial role in modern society, impacting various aspects of daily life, industry, and the environment. ynthetic fibers are integral to modern life, offering a range of benefits from cost-effectiveness and versatility to innovative applications and performance characteristics. While they pose environmental challenges, ongoing research and development aim to create more sustainable and eco-friendly alternatives. Understanding the importance of synthetic fibers helps in appreciating their role in the economy, industry, and daily life, while also emphasizing the need for sustainable practices and innovation.
Welcome to TechSoup New Member Orientation and Q&A (May 2024).pdfTechSoup
In this webinar you will learn how your organization can access TechSoup's wide variety of product discount and donation programs. From hardware to software, we'll give you a tour of the tools available to help your nonprofit with productivity, collaboration, financial management, donor tracking, security, and more.
Model Attribute Check Company Auto PropertyCeline George
In Odoo, the multi-company feature allows you to manage multiple companies within a single Odoo database instance. Each company can have its own configurations while still sharing common resources such as products, customers, and suppliers.
Instructions for Submissions thorugh G- Classroom.pptxJheel Barad
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How to Split Bills in the Odoo 17 POS ModuleCeline George
Bills have a main role in point of sale procedure. It will help to track sales, handling payments and giving receipts to customers. Bill splitting also has an important role in POS. For example, If some friends come together for dinner and if they want to divide the bill then it is possible by POS bill splitting. This slide will show how to split bills in odoo 17 POS.
The French Revolution, which began in 1789, was a period of radical social and political upheaval in France. It marked the decline of absolute monarchies, the rise of secular and democratic republics, and the eventual rise of Napoleon Bonaparte. This revolutionary period is crucial in understanding the transition from feudalism to modernity in Europe.
For more information, visit-www.vavaclasses.com
Operation “Blue Star” is the only event in the history of Independent India where the state went into war with its own people. Even after about 40 years it is not clear if it was culmination of states anger over people of the region, a political game of power or start of dictatorial chapter in the democratic setup.
The people of Punjab felt alienated from main stream due to denial of their just demands during a long democratic struggle since independence. As it happen all over the word, it led to militant struggle with great loss of lives of military, police and civilian personnel. Killing of Indira Gandhi and massacre of innocent Sikhs in Delhi and other India cities was also associated with this movement.
Read| The latest issue of The Challenger is here! We are thrilled to announce that our school paper has qualified for the NATIONAL SCHOOLS PRESS CONFERENCE (NSPC) 2024. Thank you for your unwavering support and trust. Dive into the stories that made us stand out!
1. Explain 'Controlling (CO)' in SAP.
SAP calls managerial accounting as Controlling and the module is commonly known as 'CO'.
The CO module is, thus, primarily oriented towards managing and reporting cost/revenue and is
mainly used in Internal' decision making.
As in with any other module, this module also has (a) configuration setup and (b) application
functionality.
The controlling module focuses on the internal users, and helps the management by providing
reports on cost centers, profit centers, contribution margins & profitability etc
What are the important 'Organizational Elements of CO'?
The important organizational structure of controlling includes:
Operating Concern, Controlling Area and Company Code
• Operating Concern (the top most reporting level for profitability analysis and sales &
marketing controlling)
• Controlling Area (central organization in 'controlling', structuring the internal accounting
operations)
• Cost Centers (lower most organizational units where costs are incurred and transferred)
What is a 'Controlling Area'? How it is related to Company Code?
A Controlling Area is the central organizational structure in controlling' {CO), and is used in cost
accounting. The controlling area, as in the case of Company Code, is a self contained cost
accounting entity for internal reporting purposes. The controlling area is assigned to one or more
Company Codes, so as to ensure that the necessary transactions, posted in FI, are transferred to
controlling for cost accounting processing.
Figure: Controlling Area Details
2. • One controlling area can be assigned one or more Company Codes
• One chart of accounts can be assigned to one or more controlling areas
• One or more controlling areas can be assigned to an operating concern
• One Client can have one or more controlling areas
What are all the 'Components of Controlling'?
• Cost Element Accounting
• Cost Controlling
• Cost Center Accounting
• Internal Orders
• Activity-Based Costing
• Product Cost Controlling
• Profitability Analysis
• Profit Center Accounting.
What is 'Activity Based Costing'?
Activity Based Costing, popularly called as ABC, helps you to view the overhead costs from the
point of business processes. The result is, you will be able to optimize costs for the entire
business process.
3. As a single business process will cut across several cost centers, ABC will help you to have in
enhanced view of the costs incurred.
What is ' Product Cost Controlling '?
Product Cost Controlling (CO-PC) deals with estimating of what will cost to produce a product
of service.
CO-PC is divided into two major areas:
i. Cost of materials
ii. Cost of processing
With CO-PC, you will be able to calculate:
a. Cost of goods manufactured (COGM)
b. Cost of goods sold (COGS)
CO-PC is tightly integrated with Production Planning (PP) and Materials Management (MM),
Besides FI.
The functionality helps to:
• Calculate Standard Costs of manufactured goods
• Calculate the Work-in-Progress (WIP)
• Calculate the Variances, at period-end
• Settlement of product costs
Note that CO-PC deals only with the production costs.
What is 'Profitability Analysis '?
Profitability Analysis (CO-PA) helps you to determine how profitable (denoted by the
contribution margin) your market segments are. The analysis is on the external side of the
market. You will be able to define which segments, like customer, product, geography, sales
Organization etc., of the market which are required for analyzing the 'operating results /profits'.
With multi-dimensional 'drill-down' capability, you have all the flexibility you require for the
reporting.
What is Cost Object in SAP?
4. Cost object is nothing but a cost or revenue collector in SAP.
Every P&L posting must be assigned to a Cost Object. Examples of Cost Object includes Cost
Center, Internal Order, WBS element, Sales Order, Production order. Cost Object is the key
concept in SAP Controlling.
Differentiate 'Real' and 'Statistical Postings' in CO.
The CO account assignment objects decide the type of postings allowed. This can be real or
statistical posting.
The Real Postings, allow you to further allocate / settle those costs to any other cost object in PO,
either as 'senders' or as 'receiver's.
The objects which are allowed to have real postings include:
• Cost Centers
• Internal Orders (Real)
• Projects (Real)
• Networks
• Profitability Segments
• PP - Production Orders (make-to-order)
The Statistical Posting, on the other hand, are only for information purposes. You will not be
able to further allocate / settle these statistical costs to other cost objects.
The example of such ' objects includes:
• Statistical (Internal ) Orders
• Statistical Projects
• Profit Centers
How do you define 'Number Ranges' in CO?
You will be required to define, for each of the controlling area, Number Ranges for all
transactions that will generate documents in CO. Once done for a controlling area, you may copy
from one controlling area to other controlling areas when you have more than one such area.
To avoid too many documents, SAP recommends grouping of multiple but similar transactions,
and then assigning number ranges to this group. Further, you may create different number ranges
for plan and actual data. As in FI, the number ranges can be internal or external. The document
number ranges in CO are independent of fiscal years.
5. What is a Cost Element'?
The Cost Elements represent the origin of costs.
There are two types of cost elements:
• Primary Cost Elements
• Secondary Cost Elements
What is a 'Primary Cost Element'?
The Primary Cost Elements represent the consumption of production factors like raw materials,
Human resources, utilities etc. The primary cost elements have their corresponding GL accounts
in FI. All the expense / revenue accounts in FI correspond to the primary cost elements in CO.
Before you can create the primary cost elements in CO, you first need to create them in FI as GL
accounts.
Note that SAP treats revenue elements also as primary cost elements in CO processing. The only
difference is that all the revenue elements are identified with a negative sign while posting in
CO. The revenue elements correspond to the revenue accounts in FI, and they fall under the
Category 01 / 11 of cost element category.
What is a 'Secondary Cost Element'?
The Secondary Cost Elements represent the consumption of production factors provided
internally by the enterprise itself, and are present only in the CO. They are actually like cost
carriers, and are used in allocations and settlements in CO. While creating these elements, you
need to mention the cost element category which can be any of the following:
• Category 21, used in internal settlements
• Category 42, used in assessments
• Category 43, used in internal activity allocation
What is a 'Cost Element Category'?
All the cost elements need to be assigned to a Cost Element Category, to determine the
transactions for which you can use the cost elements.
Example:
• Category 01, known as the general primary cost elements, is used in standard primary
postings from FI or MM into CO.
• Category 22 is used to settle order / project costs, or cost object costs to objects outside of CO
(like assets, materials, GL accounts etc)
6. How to, automatically, create 'Cost Elements'?
You will be able to create 'cost elements', automatically by specifying (i) the cost element, (ii)
the cost element interval and (iii) cost element category for the cost elements. All these are
achieved making default settings. The creation of cost elements is done in the background.
The primary cost elements can be created only when you have the corresponding GL accounts in
the chart of accounts of the Company Code. Even though the GL account names are used as the
names of the primary cost elements thus created by the system, you have the option of changing
these names in CO. All the secondary cost elements are created in CO; the naming of these cost
elements comes from the cost element category.
Define 'Cost Centre Accounting '.
Cost Centre Accounting (CO-OM-CCA) helps you to track where costs are incurred in your
enterprise. All the costs, like salary and wages, rent, water charges etc., incurred are either
assigned or posted to a cost centre.
Explain posting of costs to 'Cost Centers’.
When you create accounting transitions in Fl / FI-AA / MM, you typically post to one or more
GL accounts. While doing so, provided you have already configured in such a way, you also
require the user to input the cost centre for that transactions, so that when the transaction is
posted the values costs flow not only to the GL but also to CO to the appropriate cost centre.
The system will be creating two posting documents: one for FI and another for CO.
Besides, you will also be able to post non-financial information like direct labor hours from HR
or SAP modules to cost centers in CO.
What is an 'Activity Type'?
Activity Type helps you do define the service / action (example: human labor, machine
labor, repair hours etc) performed or provided by a cost centre. It forms the 'basis' for allocating
costs to if other cost centers or internal orders etc. You may assign an activity type to an
operation so that they are reflected in PP. a CO document is created with the costs of the
operation allocated from m the cost center that produced the operation to a production order,
when the operation is completed in PP.
You may group activity types into activity type groups for easy maintenance.
7. You need to arrive at the activity price which needs to be attached to that particular activity
type for planning or recording the actual. The activity price is calculated by dividing the total
costs by the If total planned / actual activity quantity (hours, units etc).
It is not necessary that all the cost centers need to have activity types associated with them. If
there is no output from a cost centre, then there will be no activity type for that cost centre.
What is a 'Resource' in CO?
Resources are goods / services, consumed by CO objects like cost centre / internal order / WBS
element, which are supplied (internally or externally) to an organization in order to produce
business activities. The resources are used only in planning and not for tracking the actual.
There are three types of resources:
• Type B (used in base planning object)
• Type M (refers to a material)
• Type R (exists only in CO-OM)