Recommendations in Overhead Cost Projects 

When choosing the settlement type for overhead cost projects, bear the following in mind:

If plan integration is active, you can only settle to cost centers in one go. Multilevel settlement is not supported by plan integration.

The volume of settlement information in direct settlement is much less than in multilevel settlement because no additional settlement is made to interim receivers.

Direct settlement leads to very detailed information in the settlement receiver page on the object from which the costs were settled.

The type of settlement you choose has an effect on how the values are displayed in reporting.
In multilevel settlement, responsibility for the settled costs passes to the receiver. If you then move the settled object, the system displays the costs correctly in the settled object, and shows the amount not yet settled in the superior cost element. The reason for this is the logic for the elimination of internal business volume. Internal business volume is not eliminated until you call up the report, and usually takes place in the project higher up in the hierarchy display.

To avoid errors you should not shift any objects after settlement.

In direct settlement, for example settlement of WBS elements to cost centers, responsibility for the costs in the settlement object. As a result, the system continues to show the total cost amount even after the object has been shifted.

If you have maintained an incorrect settlement receiver as the final cost object, there will be a lot of maintenance work in direct settlement because you have to edit several objects.

If you are using the automatically generated settlement rule , the system generates a settlement rule to a profitability segment, manager, or requesting cost center. This significantly reduces the maintenance work involved in direct settlement.

We recommend that you use direct settlement in overhead cost projects.