A cost object hierarchy consists of the following elements:
The costs for the cost object nodes and the assigned orders are settled when you perform periodic settlement.
Both the settlement rules for the cost object nodes in the hierarchy and the settlement rules for the orders assigned to the hierarchy must specify periodic settlement (see also:
At the end of the period, the costs that were assigned directly to the cost object nodes are either:
This type of settlement uses material account determination.
SAP recommends this type of settlement if you do not want to perform distribution.
This type of settlement uses manual account assignment.
Procedures for Creating Settlement Rules
The settlement rules for cost object hierarchies without distribution can be created using two different procedures. You control which procedure is active in Customizing for Product Cost by Period under Cost Object Hierarchies ®Define Cost Object Categories for Cost Object Hierarchies.
Note that if you are using cost object hierarchies, the order balance will usually show a shortage because some costs for the materials being produced were entered at the level of the hierarchy, while the balance of individual cost object nodes will show a surplus.
For materials with price control indicator S, the moving average price updated for statistical purposes during settlement.
This function is not active for materials that are assigned to a cost object hierarchy.
For detailed information on settling cost object hierarchies, refer to the IMG for Product Cost Controlling in Cost Object Controlling under Product Cost by Period® Cost Object Hierarchies ® Define Cost Object Categories for Cost Object Hierarchies.
For information on processing cost object hierarchies in the period-end closing process, refer to the following sections:Period-End Closing for Cost Object Hierarchies Without Distribution Period-End Closing for Cost Object Hierarchies with Distribution