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Former Member

business area

hi

what exactly a business area is, and how i can be determined

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  • author's profile photo Former Member
    Former Member
    Posted on Apr 28, 2008 at 01:31 PM

    Business Areas in SAP are used to differentiate transactions originating from different points/lines/locations in business.

    The functions of business area is to create balance sheets and profit and loss statement below the company code level. It functionality can be duplicated using Profit center accouting.

    The transaction for creating business area is OX03.

    In sales & distribution, this can be assigned to sales area / plant and distribution channel, according to the rule maintained in the enterprise structure assignment option under business area assignment.

    Prase

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  • author's profile photo Former Member
    Former Member
    Posted on Apr 28, 2008 at 02:52 PM

    Hi Balraju,

    Business Area determines where the revenue should be allocated when you sell a material or a service.

    For eg: If your customer is in say Mumbai and he is ordering for a service in Delhi (say DIAL - Delhi International Airport Limited) then based on the terminology.

    Your customer would belong to B Basis Business Area - WHERE THE REVENUE IS COMING FROM or WHERE YOUR CUSTOMER BELONGS TO (SALES OFFICE).

    Whereas your DIAL sales will belong to A Basis Business Area - WHERE THE REVENUE IS GOING TO.

    Cost Center would determine where your allocate your cost to.

    Say Rounding Off can be used as a cost element, because some sort of revenue is lost when figures are roudned off..

    Please Reward If Really Helpful,

    Thanks and Regards,

    Sateesh.Kandula

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  • Posted on Apr 29, 2008 at 04:52 AM

    Business area is a separate business unit for which cross company code internal reporting can be carried out.

    A business area can report financial information across several company codes with regard to specific fields of activity (for example, Division-related).

    Business area balance sheets and profit and loss statements can only be used for internal reporting. Compare this to company code. The balance sheet and the profit and loss statement at company code level are required by law.

    In Customizing, you can specify the rules you want to use for determining the business area for each sales area.

    Three rules are available:

    - Business area assignment by plant and item division.

    - Business area assignment by sales area.

    - Business area assignment by sales organization, distribution channel, and item division.

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  • Posted on Apr 29, 2008 at 04:55 AM

    Dear Balaraju

    Please check the link

    [Why and When to use Business Area |http://www.sap-img.com/zf003.htm]

    thanks

    G. Lakshmipathi

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