All data relevant to cost flows automatically to Controlling from Financial Accounting. At the same time, the system assigns the costs and revenues to different CO account assignment objects, such as cost centers, business processes, projects or orders. The relevant accounts in Financial Accounting are managed in Controlling as cost elements or revenue elements.
Controlling provides you with information for management decision-making. It facilitates coordination, monitoring and optimization of all processes in an organization. This involves recording both the consumption of production factors and the services provided by an organization.
As well as documenting actual events, the main task of controlling is planning. You can determine variances by comparing actual data with plan data. These variance calculations enable you to control business flows.
Income statements such as, contribution margin accounting, are used to control the cost efficiency of individual areas of an organization, as well as the entire organization.
How To Configure The Controlling AreaMaintaining the Controlling Area
OX06 - Maintain Controlling Area
The cost accounting environment where costs and revenues are managed.
The link between FI and CO is established throught the assignment of company codes to a controlling area.
A controlling area can have multiple company code assignments. However, a company code can be assigned to only one controlling area.
OKKP - Activate the Controlling Area
Assignment of Controlling Area
Here you define which are the components you want to activate :-
- Cost Center
- Order Management
- Commitment Mgt
- Profit Analysis
- Acty-Based Costing
