Controlling Area

[Former Member]

Dear All,

Whai is controlling Area ??? How it is related with FI and MM ?

Somasundaram

[Former Member]

Controlling Area:

An organizational unit within a company, used to represent a closed system for cost accounting purposes.

A controlling area may include single or multiple company codes that may use different currencies. These company codes must use the same operative chart of accounts.

All internal allocations refer exclusively to objects in the same controlling area.

[Former Member]

hi,

The controlling area is the highest organizational level within CO. It must exist before Cost Center Accounting (CCA) can be used. A controlling area will be created on a one-to-one basis with the company code created in FI. This does not facilitate cross-company code accounting in CO. In order to facilitate cross-company code accounting, more than one company code is usually assigned to the controlling area.

Note the difference between cross-company code accounting and intercompany accounting.

Cross-company code accounting involves the allocation of costs across cost centers (or responsibility centers) existing in different company codes within CO. Intercompany accounting involves the recording of intercompany receivables and

payables in FI.

There are several factors considered when determining whether one or more controlling areas will be used. The major factors considered are whether cross-company code accounting is desired, and whether more than one chart of accounts is needed at the controlling area level. In addition, currency issues may also be considered.

Step 1 : Create Controlling Area:

Menu Path

IMG:Controlling > General Controlling > Organization >

Maintain Controlling Area T-Code : OKKP

On the "Choose Activity" pop-up window select the activity "Maintain Controlling Area" by double clicking on the corresponding line.

On the Change View Basic data: Overview screen: Click on the button

· Fiscal year from Current year

· Cost Centers Component active (choose from the pull-down menu)

Other components will be activated in later exercises

· Select "Cost objects" by clicking on the check box

· Select "All currencies" by clicking on the check box (it may already be checked by default).

· Select "Variances" by clicking on the check box

Click on the icon to complete the transaction and exit.

Regards,

Ranjan aMit

[Former Member]

What Controlling is all about?

Controlling precedes CCA

The controlling area is the highest organizational level within CO. It must exist before Cost Center Accounting (CCA) can be used. A controlling area will be created on a one-to-one basis with the company code created in FI. This does not facilitate cross-company code accounting in CO. In order to facilitate cross-company code accounting, more than one company code is usually assigned to the controlling area.

Note the difference between cross-company code accounting and intercompany accounting.

Cross-company code accounting involves the allocation of costs across cost centers (or responsibility centers) existing in different company codes within CO. Intercompany accounting involves the recording of intercompany receivables and

payables in FI.

There are several factors considered when determining whether one or more controlling areas will be used. The major factors considered are whether cross-company code accounting is desired, and whether more than one chart of accounts is needed at the controlling area level. In addition, currency issues may also be considered.

Step 1 : Create Controlling Area:

Menu Path

IMG:Controlling > General Controlling > Organization >

Maintain Controlling Area T-Code : OKKP

On the "Choose Activity" pop-up window select the activity "Maintain Controlling Area" by double clicking on the corresponding line.

On the Change View Basic data: Overview screen: Click on the button

· Fiscal year from Current year

· Cost Centers Component active (choose from the pull-down menu)

Other components will be activated in later exercises

· Select "Cost objects" by clicking on the check box

· Select "All currencies" by clicking on the check box (it may already be checked by default).

· Select "Variances" by clicking on the check box

Click on the icon to complete the transaction and exit.

After the above go to Cost center Accounting

Regards,

Indranil