Controlling (CO)
Controlling is used for internal reporting
Controlling Area is the highest hierarchy.
Areas to be covered:
1. Cost element Accounting
2. Cost centre accounting
3. Internal orders
4. Profit centre accounting
5. Product costing
6. Profitability analysis
1. Cost element Accounting: To update controlling records you have to create cost elements
Cost elements are:
a. Primary cost elements
b. Secondary cost elements
2. Cost centre Accounts: To view department wise cost
3. Internal orders: To view costs for a specific tasks
4. Profit Centre Accounting: To view profitability, product wise, product group wise (or) location wise if business area is not activated in FI
5. Product Costing: valuation of inventories like finished goods and work in process.
6. Profitability analysis: To view profitability for number of parameters at a time like
Customer wise, product wise, sales organization wise, plant wise, sale order wise
This is called data cube
It is a reporting tool
Basic settings for controlling:
FI organization structure Co. organization structure
Company Controlling
↓
Company code
↓
Business Areas Cost centre
Scenario – 1
Company
↓
Company code = Controlling Area
↓ ↓
Business Area à Cost Centre
Controlling area at company code level, cost element is assigned to Business Area.
Scenario – 2
Company = Controlling area
↓
Company code
↓
Business Area à Cost Centre
(Controlling area at company level)
Scenario (2) is more flexible, because in this scenario when we want to view number of cost centers data for different company codes, we have to go for 2nd scenario.
Also we want view No. of cost centers data for a particular company code we get in 2ndscenario by creating cost center group.
Maintain controlling area:
Path: SPRO àControlling àGeneral controlling à Organization à Maintain controlling area
Double click on maintain controlling area (T. Code OKKP)
Select new entries button
Controlling area:
1stscenario: company code: AML
2ndscenario: Any no. (Or) name (Max 4)
Give controlling area: AML
Name: Controlling area for AML
Company code à Controlling Area: select controlling area same as company code
Currency type: select 10 (company code currency)
Once we select 10, your currency field, chart of accounts field, fiscal year variant field updated automatically
Cost centre standard hierarchy: AMLHIER (AML Hierarchy)
Select save button (or) (ctrl + s)
Select ‘yes’ button for the message, system to create as a standard hierarchy
Select create request button
Short description:Co. Customization for AML
Press enter
Press enter once again to saving the request
Double click on Activate components/control indicators folder
Select new entries button
Fiscal year: 2006
For the field cost centre: select component active
Select activate type check box
Order management: select component active
Select profit center check box
Select save button (or) (ctrl + s)
Ignore the message, press enter
Double click on assignment of company codes folder
Select new entries button
Select the company code: AML
Select save button (or) (ctrl + s)
Maintain Number ranges for controlling documents
Same path: (T. Code KANK)
1. Co. documents through posting from FI document:Controlling through posting of accounts in FI Module i.e. called COIN
In FI you have to give the details like
↓
SA Co: Automatically generated number range intervals
↓
‘O’
↓
1 – 100000
2. Report Co. line items (RKU3)
Posting through FI document
Ex: Wages Dr Dept A 100000
Wages Dr Dept B 200000 (COIN)
Wages Dr Dept C 300000
To Bank 600000
To Bank 600000
At the time of posting which department we are posting is don’t know
After Posting (repost to CO items) (RKU3)
We transfer 600000 to various cost centers (or) dept.
600000: 1) Dept A 100000
2) Dept B 200000
3) Dept C 300000
(Transfer line item wise/document wise)
Here 1 FI document and 2 CO. documents are generated
3. Repost costs (RKU1): Incase split the department (or) wrong cost centre postings.
Example: Dept A Dept Z
Salaries
April 100000 à 20000
May 200000 à 50000 (Repost to cost line items)
June 200000
July 200000
August 100000
Wages: 200000
------------
Total 1000000
Here 200000 Salaries & Wages belongs to dept Z& 800000 belongs to dept A
How we shown the total transaction amount transferred to department wise
Here NO FI documents
Only Co. document
Dept A Dept B
Salaries A/C
1 100000 20000
2 200000 50000 (Repost cost line items
3 300000
4 50000
5 150000
---------- --------
Total 800000 70000(Repost Cost)
4) Planning Primary Costs (RKP1) (Budgeting)
Maintain Number Ranges
(Transaction Code KANK)
Give the controlling area: AML
Select Maintain group’s button
From the Menu select group à Insert
Text: Co. document No. range intervals for AML
From No: 1 to 100000
Enter
Double click on COIN (Co. through postings from FI)
Double click on RKU3 (Repost Co. line items)
Double click on RKU1 (Reposts costs)
Double click on RKP1 (Planning Primary cost)
Select Co. document no. range intervals for AML check box
From the menu select edit à Assign element group
Save (or) (ctrl + s)
Maintain versions:
(Versions are nothing but budgets)
- Planning for whole year (original Budget) – 0
- Revised Budget – 1
- Re revised Budget – 2
Here actual are compared with original/revised (or) re revised budgets
Path: Same Path
Select version ‘0’
Double click on settings for each fiscal year
Give your controlling area: AML
Enter
Once the planning is complete select version locked check box so that no one change planned figures
Save
Cost element Accounting:
To update Co. records we require cost elements
Cost elements are 2 types
1. Primary cost elements
2. Secondary cost element
- Primary cost elements: These are nothing but G/L expenditure/ revenue Account.
Posting to primary cost elements are possible.
- Secondary cost elements:
- Other than your G/L Account
- Postings are not possible
- Support for allocation/settlement in Co.
Cost element categories:
Primary cost element categories:
- Primary costs/cost – reducing revenues – used for expenditure account
3. Accrual/deferral per surcharge àused for Month end provisions in co
11. Revenues – used for sales and other income accounts
12. Sales deductions – used for expenditure like trade discount/sales conversion etc.
22. External settlement: Allocation from Co to G/L (or) Assets.
Secondary cost element categories:
21. Internal settlement – Allocation from Co to Co
31. Order/project results analysis (used for work in process calculation in product costing)
41. Over head rates àused for raw material over head/production overhead calculation in product costing.
42. Assessment àused for allocation of service department cost to production departments.
43. Internal activity allocation (This is used for calculation of activity like machine hour rate/labor rate in product costing.
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