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Former Member
Mar 01, 2011 at 05:04 PM

Org Structure- Multiple Legal entities under single company code

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Hello All

We have 3 different legal entities to run business . The idea is to have single company code and differentiate legal entities at profit centre level(financial statements derived from profit centre reports).

The key reason for this design is to avoid SAP inter-company postings when costs get allocated across legal entities, which will occur frequently as the Legal Entity structure does not align with business structure. Cost allocations are a fundamental requirement for the client to determine overhead rates for cost-plus contracts.

initially there are thoughts about deploying HCm solution which needs org structure in place. As staff from one Business Group can work in more than one Legal Entity and as Personnel Areas can only be assigned to 1 Company Code, representing the 3 operating Legal Entities by a Company Code will require replicating the Business Groups as Personnel Areas for each Company Code.

what would be more easy?

1. splitiing form one company code to many

2. summarization of multiple company codes t one if there is a need in future in bot cases.

I would like to know experts thoughts on it on disadvantages of doing these.

Thanks

S