An internal order is used as an interim collector of costs and an assistance to the planning, monitoring and controlling processes needed. The costs can be settle to one or more receivers like cost center, fixed asset, profitability segment, etc, when the job has been completed.
Author Archives: Admin
Profit Center Group contains set of profit centers that are having similar characteristics. Profit center accounting is an organizational unit which reflects organization management-oriented structure for internal control. Profit Center Accounting evaluates the individual, independent areas profit or loss of within an organization.
Standard profit center hierarchy in a controlling area contains all the profit centers in it. Standard Profit Center Hierarchy is required to group the profit centers in hierarchical order.
Every posting object may not have assigned to the profit center and it may happen that some objects system are unintentionally left without an assignment to a profit center. In this case, postings to accounts are assigned to the dummy profit center of the controlling area.
A business unit in any company can be classified as profit center, cost center or an investment center. Cost center is a simple and straightforward division in an organization.
Cost center hierarchy consists groups of cost centers in a tree structure within a controlling area. Cost center hierarchy plays vey import role in SAP Controlling Area.
Below process is to discuss the cost center posting –
The Cost Center category is an indicator in the cost center master data which specifies the category for the cost center. Cost Center categories provide the ability to safe guard the postings to cost centers.
Cost Element Group is an organizational unit storing a group of cost elements. Any number of cost element groups can be defined as part of master data maintenance for valuation, planning and allocation purposes in Cost Element Accounting or Cost Center Accounting.
Primary Cost elements are cost carriers from Financial Accounting (FI) to Controlling (CO) module and created to compare the G/L accounts of profit loss statements. A Primary Cost element is used to transfer cost from Financial Accounting (FI) to Controlling (CO) Module.