As a shipper, you create documents such as purchase orders, sales orders, and deliveries in SAP ERP. The SAP Transportation Management (SAP TM) system creates order-based transportation requirement (OTR) and delivery-based transportation requirement (DTR) documents to fulfill the SAP ERP demand. You use these requirements documents to create execution documents such as freight orders or freight bookings. You create a freight settlement document to transfer the transportation costs to SAP ERP for verification.

You must perform cost distribution at the level of ERP item in the freight settlement document.

You use customizing settings in SAP ERP to specify the type of posting you want to do with the distributed cost, for example, material valuation or general ledger and CO-PA posting. Depending on the settings you have specified, the agency business document posts to these or other cost objects. The SAP ERP system uses the underlying sales order and delivery information from the ERP item to determine from the source SAP ERP document the particular cost object against which it posts the distributed costs.

For example, in Customizing for SAP ERP, you specify that you want to perform CO-PA posting. A particular sales order references a particular CO-PA object. You create OTR or DTR orders in SAP TM for the sales order. When posting the distributed costs in SAP ERP, the system posts to the CO-PA object that is referenced in the sales order.

Examples of cost objects include cost centre, profit centre, CO-PA segment, and internal order.