Basic Settings - Org Units
SAP CO
MANAGEMENT ACCOUNTING OVERVIEW
Financial vs Management Accounting
Financial Accounting Management Accounting
Reports for external users Reports for internal users
Balance Sheet, Income Statement Cost Center Reports, Profit Center
Reports
Actual reports created at Company Code Budgeting, Planning and Commitment
level done at divisional, or smaller levels
Represented as SAP FI module Represented as SAP CO module
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Basic Settings - Org Units
Components of the CO module
• All the values initially flow from Cost Elements
financial accounting.
• At the time of financial entry Cost Centers
you specify the CO component as
well. Profit Centers
• You can further allocate Internal Orders
between the CO components
later. Profitability Analysis
Product Costing
Flow of Costs in CO module
Overhead Cost Controlling (CO-OM) take overhead costs that
cannot be assigned directly to the goods and services of a company
and allocate them later (cost ctrs, intern orders, etc.)
Product Cost Controlling (CO-PC) take costs for producing goods
and services and settles them to FI or CO-PA.
Profitability Analysis (CO-PA) analyses the revenue, costs and
profitability of products in different dimensions (location, customer
groups, product groups, etc.)
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Basic Settings - Org Units
Flow of Values to CO via other applications
FI - Financial postings will most likely be posted to a cost object like
cost center postings (journal postings, depreciation postings, etc. )
HR - Salary and other costs are posted to cost centers. These labour
costs will need to be allocated later to the production cost ctrs.
MM - During the purchasing process there will be postings to the CO
module. PO – GR – IR
SD - During the sales process there will be postings to the CO module.
SO – GI – Billing
PS – WBS Settlement to Assets or cost centers/other cost objects
Recap & Assignment
o Know the difference between Financial Accounting and
Management Accounting
o Learn the basics of how costs flow within the CO module
o Learn the basics of how costs flow to the CO module
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