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Ulfa Nurul Yasmine

0117124033/Kelas B2-B

Unit 2
Organization of Management Accounting

Unit Overview

This unit discusses the organizational units and structures used in Management
Accounting. It also covers the basic data used for overhead management accounting.
This information is important when setting up Management Accounting for your
company.

Lesson: Organizational Units Used in Accounting

Lesson Overview
This lesson introduces the various SAP organizational units, such as client, company code,
and controlling area, and describes the relationships between them. Knowledge of these
organizational units is important for working with SAP R/3 and for creating and
maintaining master data. This lesson takes a closer look at the organizational units used in
Management Accounting.

Business Example
Each company has its own particular organizational structure. You want to learn about the
organizational elements used in SAP systems so you can decide which ones to use to
represent your enterprise structure in the system.

Organizational Units Used in SAP Solutions


The following organizational units are used in SAP solutions:
 Operating concern
 Controlling area
 Company code
 Business area
 Plant
 Purchasing organization
 Sales organization
Ulfa Nurul Yasmine
0117124033/Kelas B2-B

The controlling area is the basic organizational unit in Management Accounting. A


controlling area is a closed entity used for cost accounting. You can allocate costs only within
a controlling area. These allocations cannot affect objects in other controlling areas. You can
assign more than one company code to a controlling area. This enables controlling across
company codes.

The company code is an independent accounting unit. Financial and profit and loss
(P&L) statements are prepared at company code level to meet legal reporting
requirements. Business areas (BA) can be used to group strategic business fields and
for reporting in P&L and financial statements (not suitable for auditing, suitable for
reporting purposes only). Business areas can also be cross-company code.

The plant represents a production unit and is the central organizational unit in the SAP
R/3 components, Materials Management and Production Planning. When you define
organizational structures, you assign plants to company codes.

The purchasing organization is an organizational unit used in Materials Management


– Purchasing; the sales organization is an organizational unit used in Sales Order
Management. Both of these organizational units are important for Management
Accounting only because this data needs to be included for integral business processes
between Logistics and Accounting.

You can use three currencies in Management Accounting:


 Controlling area currency
 Company code currency or object currency
 Transaction currency (used for posting a document to Management Accounting)

Lesson: Basic Data for Overhead Management Accounting

Lesson Overview
This lesson describes the master data required for Management Accounting. You will learn
the importance of the standard hierarchy for cost centers. The lesson also shows you how
to create cost elements, activity types, statistical key figures, internal orders, and master
data groups. With this information, you can set up the master data in the system for your
enterprise.
Ulfa Nurul Yasmine
0117124033/Kelas B2-B

Business Example
You want to see how to set up the master data that is relevant for Management Accounting
in the system. To analyze the responsibility for costs, you subdivide your company into
various departments or businesses, which you depict in the system with appropriate master
data such as cost centers, orders, and profit centers. You then assign the cost incurred in the
system to this master data by responsibility.

Master Data Used in Cost and Revenue Accounting


Cost and Revenue Accounting uses the following master data:
 Chart of accounts
 Primary cost elements
 Secondary cost elements
 Revenue elements
 Cost element category

To set up an expense account and create it as a cost or revenue element, follow these
steps:
1. Define an expense account or revenue account in Financial Accounting.
2. Create this account automatically or manually in Management Accounting as
a cost element or revenue element.

Each cost element is assigned a cost element category in its master record, which
determines the type of transaction for which a cost element can be used. The following
are examples of cost element categories:
 Cost element category 1 (primary cost element) is used for posting primary
costs in Management Accounting.
 Secondary cost element category 42 is used for the internal allocation of costs
in Management Accounting.
 Cost element category 21 is used for order settlement in Management
Accounting.

Master Data Used in Overhead Cost Controlling


Overhead Cost Controlling uses the following master data:
 Cost centers
 Activity types
Ulfa Nurul Yasmine
0117124033/Kelas B2-B

 Statistical key figures or tracing factors


 Internal orders
 Business processes

Statistical key figures are measurable values that are applicable to cost centers, profit centers,
internal orders, or processes. An example of a statistical key figure would be the number of
employees in the Transportation cost center who perform activities, such as vehicle
maintenance.

You can use statistical key figures as an allocation base (or tracing factor) for periodic
allocations such as distribution or assessment, and for analysis purposes (such as calculating
the rent costs per employee).

You define a statistical key figure as a fixed value or a totals value.


 Fixed values are carried over from the periods in which they are posted to all
subsequent periods of the same fiscal year. Fixed values are useful for statistical key
figures that tend to remain relatively constant over time, such as the number of
employees. You must update the data only when the value changes.
 Totals values are not transferred to subsequent periods and must be entered
individually for each period. Totals values are preferable for statistical key figures
whose values tend to change from period to period, such as kilowatt hours of electricity
used.

Master data groups enable you to group different master data items from Overhead
Cost Controlling for analysis and reporting, for planning, and for allocation. These
master data groups are used for processing more than one master data record in a single
transaction.

Task 1

Create a secondary cost element.


1. Create a secondary cost element 6200## in controlling area 1000 (CO Europe).
Make sure that the cost element is valid for the entire fiscal year. Name the cost
element DAA Check Assets, enter a suitable description, and assign cost element
category 43. Save the new cost element.
Ulfa Nurul Yasmine
0117124033/Kelas B2-B

a) Choose Accounting → Controlling → Cost Center Accounting → Master Data


→ Cost Element → Individual Processing → Create Secondary.
b) Enter data.
c) Choose Master Data and enter data on the next screen.
d) Choose Save.

2. Explain how you can use a cost element of category 43.


With cost element category 43, you have stipulated that this cost element will be used for
internal activity allocations or process allocations. Internal activity allocations result in the flow
of costs from a cost center to other controlling objects (cost centers, overhead orders,
production orders, and so on) based on the number of activity units provided by the sender to
the receiver. The allocated costs are posted using this cost element category.

Task 2

Create an internal service cost center and a production cost center.


1. Create an internal service cost center in controlling area 1000 (CO Europe) and in the
company code of the German subsidiary (1000). Make sure that the cost center is
valid for the entire fiscal year and that it is assigned to the HAC040 node in the
standard hierarchy.

Assign cost center SERV-## (and name it Group ## Services), a service cost center
(category H), to the business area Corporate Other (9900) and to the profit center
Internal Services (1400). Make sure that the cost center is locked only against
planning and posting revenues. Save the cost center master data.

a) Choose Accounting → Controlling → Cost Center Accounting → Master Data


→ Cost Center → Individual Processing → Create.
b) Enter data.
c) Choose Master Data and enter data on the next screen.
d) Choose Control. Under Lock, make sure that only Actual Revenues and Plan
Revenues are selected.
e) Choose Save.
Ulfa Nurul Yasmine
0117124033/Kelas B2-B

2. Create a production cost center in the controlling area CO Europe (1000) and in the
company code of the German subsidiary (1000). Make sure that the cost center is
valid for the entire fiscal year and that is assigned to the HAC040 node in the standard
hierarchy.

Assign cost center PROD-## (name it , Group ## Production), which is a production


cost center (category F), to the business area Mechanical Engineering (1000) and
the profit center High Speed Pumps (1010). Make sure that the cost center is locked
only against planning and posting revenues. Save the cost center master data.

a) Choose Accounting → Controlling → Cost Center Accounting → Master Data


→ Cost Center → Individual Processing → Create.
b) In the Cost Center field, enter PROD-##, check the validity period (current fiscal
year) and enter SERV-## as the reference cost center.
c) Choose Master Data and enter data.
d) Choose Control. Under Lock, make sure that only Actual Revenues and Plan
Revenues are selected.
e) Choose Save.

Task 3

Create a cost center group.


1. To be able to address both new cost centers at the same time, create a cost center
group that contains both cost centers. Name the cost center group CENTERS-##
and enter the description Group ## Cost Centers. Assign this group to both the
production cost center (PROD-##) and the service cost center (SERV-##).
a) Choose Accounting → Controlling → Cost Center Accounting → Master Data
→ Cost Center Group → Create.
b) In the Cost Center Group field, enter CENTERS-##.
c) Choose Hierarchy. Enter Group ## Cost Centers as the description.
d) Choose Insert Cost Center. In the left column, enter both PROD-## and SERV-
##.
e) Choose Save.
Ulfa Nurul Yasmine
0117124033/Kelas B2-B

Task 4

Create activity types to describe the production output of the new service cost center.
1. Display activity type 1421 and check the master data.
a) Choose Accounting → Controlling → Cost Center Accounting → Master Data →
Activity Type → Individual Processing → Display.
b) In the Activity Type field, enter 1421.
c) Choose Master Data. Check the master data.
2. Create activity type REP-## by making a copy of activity type 1421. Make sure that
the activity type is valid until the last day of the current year.
a) Choose Accounting → Controlling → Cost Center Accounting → Master Data
→ Activity Type → Individual Processing → Create.
b) Enter data.
c) Choose Master Data. Enter data.
d) Choose Save.
3. Create activity type CHK-## by making a copy of activity type 1421. Make the
activity type valid for the entire year. This activity type is used for checking the assets
that belong to your group; therefore, its name and description are Check Assets GR-
##. Activity type category 1 stands for manual entry with manual allocation; the
allocation cost element is your new cost element DAA Check Assets (6200##).
a) Choose Accounting → Controlling → Cost Center Accounting → Master Data
→ Activity Type → Individual Processing → Create.
b) Enter data.
c) Choose Save.

Task 5

Create a statistical key figure.


1. Create statistical key figure EMPL## (number of employees) with a fixed value
to record the number of employees in your cost centers. Use the unit of measure
for each (EA).
a) Choose Accounting → Controlling → Cost Center Accounting → Master
Data → Statistical Key Figures → Individual Processing → Create.
b) In the Statistical Key Figure field, enter EMPL##. Choose Master Data.
Ulfa Nurul Yasmine
0117124033/Kelas B2-B

c) Enter data.
d) Choose Save.

Task 6

Create an overhead order to which you can allocate costs in each accounting period.
1. Use the Order Manager to create an overhead order. Use order type Internal Order –
Marketing (0400). Give your order the name Trade Fair Group ## and assign it to
the business area Corporate Other (9900) and profit center Internal Services (1400).
Specify your service cost center (SERV-##) as the cost center responsible.
a) Choose Accounting → Controlling → Internal Orders → Master Data → Order
Manager. Choose Create.
b) Enter 0400 as the order type and choose Enter. Enter Trade Fair Group ## as the
description.
c) Choose Assignments. Enter data.
2. Create a periodic settlement rule to settle 100% of the actual costs to your service cost
center SERV-##. Save the order. Make a note of the trade fair order number on your
data sheet.
a) Choose Settlement Rule.
b) Enter data
c) Choose Save. Make a note of the trade fair order number.