What is an SAP controlling area?

In SAP, Controlling area is an organizational element which is responsible for management of costs and profits. The relation between controlling area to company code is one to many relationship, so one or many company codes can be linked to a single controlling area.

What is controlling area in SAP with example?

Organizational unit in an organization that represents a closed system used for cost accounting purposes. A controlling area may contain one or more company codes, which can operate in different currencies, if required. The company codes within a controlling area must all use the same operational chart of accounts.

How do you set a controlling area in SAP?

IMG Path: SPRO => IMG => Controlling => General controlling => Organization => Maintain controlling area.

1. Run T-code: OKKP;
2. Double click on “Maintain controlling area”;
3. In the basic data overview screen, select “New entries” to create new controlling area.

How do you find a controlling area in SAP?

Summary –

1. Step-1: Enter the transaction code OX19 in the SAP command field and click Enter to continue.
2. (OR)
3. Step-2: – Select the Controlling Area, double click on it to open the controlling area details.
4. Step-3: -Double click on Assignment of Company Code(s) to proceed further.

What is the purpose of controlling area in SAP?

A Controlling Area is an organization unit used for Cost accounting purpose. A controlling area can be assigned to multiple company codes at the same time. Controlling Area is a very important organization unit in SAP Controlling. This organization unit contains the most important configurations required for whole controlling module.

How is controlling area related to company code?

The relation between controlling area to company code is one to many relationship, so one or many company codes can be linked to a single controlling area. All the companies within one controlling area should use same chart of accounts (COA) and fiscal year variant (FSV). SAP Transaction code: – OKKP.

What can you do with a controlling area?

Through controlling area, you can generate all costs and managements reports for internal purpose like If you are maintaining controlling area with 1:N methodology, than all company codes should have common chart of accounts, fiscal year variant and currency may differ.

How are objects assigned to a controlling area?

If they are overhead costs, then they are assigned to cost centers or overhead cost orders. The system then allocates them using internal allocation techniques, according to their source. When you create master data, the system always assigns the Controlling objects to a controlling area and a company code.