Assigning Controlling Areas and Company Codes (SAP Library

Assigning Controlling Areas and Company Codes

Use

The company code and controlling area organizational units can be combined in a number of ways. Using these combinations you can represent organizations with different structures.

One Controlling Area is Assigned to One Company Code

In this example, the financial accounting and cost accounting views of the organization are identical.

Multiple Company Codes Assigned to One Controlling Area

This example is Cross-Company Code Cost Accounting. Cost accounting is carried out in multiple company codes in one controlling area. All cost-accounting relevant data is collected in one controlling area and can be used for allocations and evaluations. In this case, the external and internal accounting perspectives differ from each other.

For example, this method can be used if the organization contains a number of independent subsidiaries using global managerial accounting. Cross-company code cost accounting gives you the advantage of using internal allocations across company code boundaries.

If you assign more than one company code to one controlling area, then you need to note the following:

You need to use a consistent chart of accounts

You need to treat each cost element (in all company codes) in the same way (for example, as a primary cost element, or as an accrual cost element).

In Financial Accounting, you can also use country-specific charts of accounts.

The operative fiscal year variants in the company codes must match the fiscal year variants in the controlling area.
You should execute period-end closing in Controlling for all company codes at the same time.

You can only execute period-end closing for a shared controlling area once closing is complete in Financial Accounting.

If you wish to calculate plan prices automatically, you need to wait until planning is complete.
The system only posts reconciliation postings across company codes without tax, which means that it cannot automatically create invoices.

For tax reasons, cost flows (that are cross-company code) in Controlling can only be passed onto Financial Accounting if the company codes form an integrated company with sales tax.

If you wish to prevent cross-company code postings in Controlling, then you need to create a detailed authorization concept.

Retrospectively excluding a company code in another SAP system or client, requires more time and effort than in cost accounting by company code.
If you only use one controlling area, you can only use one operating concern.
You can only display profit center allocations in a controlling area.
You can only use transfer prices within a controlling area.

Activities

To assign one or more company codes to a controlling area, go to the Implementation Guide (IMG) and choose Controlling ® Organization ® Maintain Controlling Area.
To assign company codes to an existing controlling area, select a controlling area.

Choose Assign company code(s).

Choose New entries.

Enter the company code(s) that you want to assign to the selected controlling area.

The company code(s) must be fully maintained before you can assign them to a controlling area.