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Create Allocation Structure

During settlement, costs incurred under the primary and secondary cost elements by a sender are allocated to one or more receivers. When you settle by cost element, you settle using the appropriate original cost element.

An allocation structure comprises one or several settlement assignments. An assignment shows which costs (origin: cost element groups from debit cost elements) are to be settled to which receiver type (for example, cost center, order, and so on).

You have two alternatives in settlement assignment:

This is a good idea, for example, if the required capital spending for an asset you are building yourself is to be monitored. These costs are settled by cost element to an inventory account in Asset Accounting at the end of the year, or when the measure is complete.

Each allocation structure must fulfil the following criteria:

An allocation structure is assigned to each object to be settled. All cost elements in which costs are incurred, must be represented in the appropriate allocation structure.
Each cost element in which costs are incurred may only appear once in an allocation structure. Only one settlement cost element may be assigned to a source within a particular allocation structure.

If you require additional debit- or settlement cost elements, you can create these using the function Maintain Settlement Cost Elements.


When you settle to materials you do not need to create settlement cost elements.


You create an allocation structure as follows:

1. Choose New entries and issue identification code and a description for your allocation structure.
2. Choose Assignments to create a settlement assignment.
3. Choose New entries and create one or more settlement assigments for your settlement structure.
4. Highlight the settlement assignment required and choose source.
Specify the cost elements or the cost element group that are to be settled to particular senders using the same settlement cost element.
If you specify cost element groups assigned to your controlling area, but not yet in the account plan, you can use this opportunity to create them.
5. By choosing settlement cost element you have two alternatives:
To improve performance, use as few differing settlement cost elements as possible. You should try to use settlement by cost element as sparingly as possible.

To obtain a hierarchy listing of an allocation structure from the system , choose "Extras -> Overview list" in the allocation structures overview.