Profit Center: Integration (Organizational Units)

You can define profit centers and company codes independently of one another.

Profit centers and plant-specific materials

You can assign each plant-specific material to exactly one profit center.

For profitability analysis and representing restricted assets you can assign the costs, revenues, and inventory of several plant-specific materials to one profit center.

Controlling area and profit centers

Each controlling area can have several profit centers assigned to it, but each profit center can only be assigned to one controlling area. Profit center accounting generally occurs within one controlling area. When you carry out profit center accounting, you need to establish one currency for reports for each of your controlling areas.

You can combine profit centers from different controlling areas using Consolidation.

Profit centers and cost centers

When you carry out profitability analysis for a profit center you can include costs from several cost centers.

You can assign each cost center to the profit center to which the costs for that cost center should be charged.

You need to assign each cost center to a profit center, to carry out reconciliation between cost center and profit center accounting.

A comparison of business areas and profit centers (selected aspects)

Business area

Profit Center

Organizational unit of FI

Organizational unit of CO

Postings to FI-GL

Statistical accounting

External view

Management-oriented view

Reporting requirements similar to the requirements for external reports

Focus on key figures for evaluating results achieved

Flat structure – hierarchical display not possible

Hierarchical display possible

Business areas determined in both MM and SD (according to different rules)

Profit center assigned in master data according to plant-specific rules or derived characteristics

Transfer prices between business areas are not accounted for in the R/3 System

Transfer prices for movement of goods between profit centers are accounted for

Subledger accounting is integrated directly

Subledger accounting is not integrated directly