You need to decide to carry out profitability analysis using cost accounting principles or by posting date. (If you choose the former, your operating concern and your controlling area cover the same units).

You use profitability analysis by posting date to prepare a short-term profit and loss calculation for sales accounting. The main feature of this form of profitability analysis is that it uses its own value categories (operating concern value fields), which are defined independently of controlling areas and revenue elements, and which represent cost or revenue element groups.

In profitability analysis by posting date, value movements are updated within their own profitability segments and profitability analysis documents, in specific transactions.

You use cost accounting profitability analysis to guarantee that management and financial accounting systems are reconciled at the level of accounts. Profitability segments are represented by controlling objects to which values are assigned in controlling areas at the level of cost and revenue elements.

The following table compares the two methods: