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Step 1: Define your controlling Area:
Transaction code EC16 (use the copy function where possible) Maintain the settings for your controlling area by using the transaction code OX06. The settings should like similar to the following:
Notes: - You can change the controlling area name at any time - The currency of the controlling are can either be the local currency of the company code, the group currency, or any other parallel currency that is required for country specific valuation - The currency type could be country specific - The chart of accounts used, would be the same chart of accounts that is used for the country of the controlling area - The K4 fiscal variant is pre-delivered, and can be changed when required - In addition to the standard hierarchy that is used for PCA and CCA, you can define another hierarchy using the transaction code KCH5. If you choose the option to not use the standard hierarchy, then you must make the settings for “Do not use Std Hier.” - Multiple company codes can be assigned to the same controlling area, and not vice versa. - If you choose to use Profitability Analysis, you must create an Operating Concern.
Step 2: Assign the company code to the controlling Area:
Transaction code OX19 The settings should look similar to the following
If you did choose to maintain an operating concern, you must also assign your company code to the operating concern You can assign multiple company codes to a controlling area
Step 3: Maintain settings for the controlling Area:
Use the transaction code OKKP In this step, you had already defined the settings for the company code, but there is one element that needs to be completed, you also need to the define a freely defined name for the Cost Center Standard Hierarchy as shown below:
As part of the standard automatic setting, you will see that the Reconciliation Ledger is active. This setting ensures that any posting in Finance that uses a CO object, will also be posted simultaneously to CO. You also need to determine what elements of Controlling will be activated, the settings within the transaction should look similar to the following:
Activation is year dependant, so you need to decide upfront, how long (in years) that the activation needs to be. To be safe, use the current year to 9999. If you are going to also upload previous year data into SAP, please be sure to make this setting to cover those previous years. Not all components of CO need to be activate, but when in doubt select everything. If in the initial stages of your configuration, you had decided to create an operating concern, and assign it to the controlling area, then the profitability analysis component that is shown above will be shown as being activated.
Step 4: Maintain number ranges for controlling documents:
Use transaction code KANK Where possible use the copy function for this In every SAP solution there will be a controlling area available that is country specific for you to choose from – use this controlling area to make this task easier. In many solutions this controlling area number is 0001. Use the internal number assignment feature where possible The number ranges will appear similar to the following:
Please note, the number range defined in CO is not fiscal year dependant. The number ranges used in FI is not the same number range used in CO. Most important of all, you should never transport number ranges, always create them in the target system.
Step 5: Maintain Actual / Plan Versions:
Must have one Actual version. In standard SAP, this version is represented by the number “0” Is it optional to have plan versions in SAP. In the standard system, the number “0” also represents Plan version. You can have as many plan versions as required. No transaction code available
The basic screen for the settings of version would appear as follows:
For every version you need to make the settings for Profit Center Accounting
Please note that it is fiscal year dependant. The version Locked Key is only used when planning is not to be updated anymore
For every version you need to make the settings for Controlling Area Settings
For every version you need to make the settings for Each Fiscal Year
For every specific year, you need to ensure that the configuration is made as follows (simply double click on the year)
Please note, if you are using Profitability Analysis (PA) and Project Systems (PS), there are additional elements of configuration that needs to be completed.
SAP Cost Element Controlling Configuration
Any G/L account that needs to be a part of the P&L structure or that requires the posting to a specific cost object (cost center, internal order etc.), needs to be created as a cost element. - Transaction code FS00 will create the G/L account - Transaction code KA01 will create the cost element Cost Element Master Record - The cost element number is the same number of the G/L master record - The cost element is time dependant. When in doubt use 1950.01.01 to 9999.12.31 - Cost elements can be either primary or secondary. A primary cost element is that cost element that is update in real-time from FI postings that is coupled with a CO object, for example rent expense to a plant cost center - A secondary cost element is used typically as a flow through posting, such as WIP or re-allocations. - Cost elements need to be assigned the appropriate cost element category, such as “1” represents primary costs and “11” represents a revenue posting - You can also specify a default cost center for a specific cost element master record. In the case where you have multiple company codes using the same chart of accounts, this may not be a good idea (use OKB9 instead). Automatic Creation of Cost Elements - Instead of having to create the cost element master record (KA01) every time you create a new G/L account, you can have the system create it for you. Use the transaction code (OKB2). Please note, this is chart of accounts specific.
As part of daily reporting, you may see the need to group your cost elements into specific freely defined categories. This can be done using transaction code KAH1. Please note, a cost element can only belong to one category. IT IS VERY IMPORTANT TO MAKE AN INFORMED DECISION WHEN ASSIGNING A COST ELEMENT CATEGORY TO COST ELEMENT, SINCE WHEN A POSTING IS MADE TO A COST ELEMENT, YOU CANNOT CHANGE THE COST ELEMENT CATEGORY ANYMORE.
SAP Profit Center Accounting Configuration
Transaction code 0KE5 The settings on this screen should appear similar to the following:
The standard hierarchy name that appears on this screen is very important, as it represents the top level hierarchy name for the company. The dummy profit center shown above must also be created either using transaction code KE51 or using the configuration menu path
Before you start using PCA, the fiscal year shown here must be set as active. The activation of this fiscal year is set in the following screen maintained under General Controlling configuration
Before you start making postings to PCA, must also activate the postings that should occur. This is done using the following menu path
The completed screen is relevant by fiscal year and should appear similar to the following:
At the end of the year you need to be able to net Revenues and Costs into Net Income, and carry forward this balance into the new fiscal year. This setting is done as follows using transaction code 2KET, or the following menu path:
To do this you need to specify the G/L account for retained earnings by chart of accounts. This step is done as follows:
SAP Profit Center Accounting Master Data Configuration
Before you begin creating profit center master data, it is important to map out exactly what the profit centers in an organization represents. It is also important to determine the numbering convention to be used for the profit center master data. Profit center master data can cross company codes if required. Determine profit center numbering convention before creating master data Determine which company codes are required for the profit center Determine validity period for profit center
Before you begin creating profit center data, you need to make the following configurations: Profit Center Group: This element of master data can be created either from the user menu by using the transaction code KCH1 or by using the following menu path in configuration:
You can maintain as many groups as required, as this helps you in better reporting. Profit center master data is time dependant, so be careful that the correct validity date is entered. Before a profit center can be used it needs to be activated. You can either perform the activation as a part of the profit center creation, use KE52 and activate, or as part of the mass activation process, you can navigate as per the above screen to activate the profit center master data It is a very good and normal practice to create your profit center hierarchy and structure in the SAP development environment, and then transport this hierarchy up to production as it will save you a lot of time in creating the master data.
SAP Profit Center Accounting Posting Configuration
To post financial information into PCA, the following must be performed
In the standard system, the document type A0 comes pre-delivered (use it)
The number ranges used in PCA is fiscal year specific, and should appear similar to the following:
It is good practice just to use the fiscal year 9999, as it will ensure that PCA will be valid forever. In standard SAP reporting, you have the option to use SAP pre-delivered reports. Before these reports can be used, you may need to generate these reports, this activation step can be done as follows in SAP configuration:
SAP Cost Center Master Data Configuration
Before you begin creating cost center master data, it is important to map out exactly what the cost centers in an organization represents. It is also important to determine the numbering convention to be used for the cost center master data. Cost center master data cannot cross company codes. Determine cost center numbering convention before creating master data Determine validity period for cost center
Before you begin creating profit center data, you need to make the following configurations: Before using CCA in SAP, you need to activate it. This can be done by using the following path or transaction code OKKP: (Please note this step is already done as part of the general controlling configuration, but check it just in case):
Most of the configuration is already done as part of the general controlling and PCA set up, but the following may still be required: Creation of Business Areas
Creation of Functional Areas
Creation of cost center categories
Creation of cost center groups (transaction code KSH1) Creation of tax jurisdiction codes
Creation of profit center master data (transaction code KE51)
SAP Automatic Account Assignment Configuration
Transaction code OKB9, and this screen should appear similar to the following:
In many processes across a company, there is the need for the intervention of automatic account assignment where certain staff may not be knowledgeable about what cost centers, business areas or profit centers to use when posting to a G/L account – this configuration setting helps to streamline that process. You must be aware of the following: - This configuration is company code and G/L account specific. Therefore if you are working in a multi-company code environment, you need to make sure of the assignments that you are making - All P&L accounts maintained in this configuration must be maintained as a cost element. - Before making this configuration, all relevant elements of the master data must already exist (cost element, profit center, cost center, business area) You can specify the following: - For a specific company code, G/L account, you always want a specific cost center to default for the posting (please note that although this cost center will default at the time of the G/L entry, the user still has the opportunity to override the cost center) - For a specific company code, G/L account, you always want a specific profit center to default for the posting (please note that although this profit center will default at the time of the G/L entry, the user still has the opportunity to override the profit center) - For a specific company code, G/L account, cost center, you always want a specific business area to default for the posting (please note that although this business area will default at the time of the G/L entry, the user still has the opportunity to override the business area). Also take note that the business are is already maintained in the cost center master record - In cases where you want to make multiple account assignments for the G/L and profit center combination, you can use the functionality
SAP Internal Order Configuration
Internal orders are cost collectors, where the costs are temporarily held until they are allocated (settled) elsewhere. Internal orders have defined senders and receivers. The basic configuration for internal orders is as follows: - Activate Order Management (transaction code OKKP) for the controlling area - Create Internal Order Type (transaction code KOT2_OPA)
As part of the internal order, you need to determine the reason for the order. There are many parameters that are pre-delivered, hence you will need to determine the settings that is the best fit for your internal order (there are no set rules for this configuration) Assign a number range for your internal order
Please note internal order number ranges can be internal or external. The number range has to be assigned to the internal order group.
Preparing the Internal Order for Settlement
So you have posted an internal order in a transaction, but now you need it to settle to a destined receiver. This configuration is done in the following configuration block:
The transaction code that is used for the settlement of internal order is KO88 and KO8G
Preparing for Profit Center/Cost Center Planning
So far you have done the configuration required for planning including the creation of the versions required for planning. You can manually enter plan data into SAP by using the transaction codes: - Cost Center Planning (KP06) - Internal Order Planning (KPF6) - Profit Center Planning (7KE1) - Profit Center Planning for Balance Sheet accounts (7KE3) The transactions above will allow you to manually enter the plan data into SAP, either based on a period by period basis, or on an annual pro-rated basis. This however may take a lot of time, so in SAP you can develop a Planner Profile. Within the areas of CCA, PCA, IO, there are separate transaction codes used for creating planner profiles, but the following will demonstrate the use of planning for Cost Center Accounting Use the menu path:
Click on “New Entries”, and assign a name to your profile
Save the profile
Highlight the profile and double-click on the left where titled “General Controlling”, and the following screen will appear:
Populate the screen as required from the listed options, and your completed screen should appear similar to the following:
Save your entries, and select on the left “Layouts for Controlling”. The populated screen should appear similar to the following:
Save your entries.
Using the transaction code KP26, your populated screen should look similar to the following:
Free – SAP input screen Form Based – Excel Integration
Click on Enter, and the following Excel template will be made available Rules for the excel template: - No special characters such as commas, currencies are allowed - Do not change the layout of the excel file - The values maintained on the excel spreadsheet adds to the plan data, it does not override