SAP Profit Center

Accounting
Configuration
SAP R/3 ENTERPRISE ECC6
Published by Team of SAP
Consultants at SAPTOPJOBS
Visit us at www.sap-topjobs.com

Copyright 2009-11@SAPTOPJOBS

All rights reserved. No part of this publication may be

reproduced, stored in a retrieval system, or transmitted in any
form, or by any means electronic or mechanical including
photocopying, recording or any information storage and
retrieval system without permission in writing from
SAPTOPJOBS.
 INDEX

1. INTRODUCTION 4

2. BASIC SETTINGS 5

2.1 Maintain controlling area settings 6

2.2 Create Dummy Profit Center 8

2.3 Set Control Parameters for Actual Data 11

2.4 Maintain Plan Versions 13

2.5 Allow Balances to be Carried Forward 15

3. MASTER DATA 16

3.1 Maintain Standard Hierarchy 16

3.2 Create profit center menu path change 19

4. TRANSFER PRICES (OPTIONAL) 24

4.1 Basic Settings for Pricing 24

4.2 Define Account Determination for Internal Goods Movements (Optional) 28

4.3 Define Account Determination for Prod. Varian. in Delivs to other Pctrs 33

4.4 Define Special Handling for Internal Goods Movements 35

5. PLANNING 37

5.1 Define Number Range for Local Documents 37

5.2 Create Planning Layout - Costs/Rev., Bal. Sheet A/cs, Stat. Key figures 40

5.3 Maintain Planner Profiles 53

5.4 Define distribution 67

5.5 Create Assessment cost elements 76

5.6 Define Assessment 78

6. ACTUAL POSTING 88

6.1 Maintain document types 88

6.2 Define Number Range for Local Documents 91

6.3 Maintain Automatic Account Assignment of Revenue Elements (OKB9) 92

6.4 Choose Additional Balance Sheet and P&L Accounts (3KEH) 93

7. PERIOD END CLOSING 96

7.1 Define Distribution 96

7.2 Define Assessment 100

 1. INTRODUCTION

The main aim of Profit center accounting is to determine

profit for internal areas of responsibility. Further by
assigning balance sheet items (Fixed assets, Receivables
and Payables, Stocks) to profit centers, we can also
analyze our company’s fixed asset by profit center. Profit
centers can be set up according to product lines,
geographical factors (region, offices or production sites) or
function (production, sales).

We can divide our business into profit centers by assigning the

profit centers to the various master data (materials, cost
centers, orders, projects, Sales orders, assets, cost objects and
profitability segments). Every profit center is assigned to the
organizational unit controlling area.

In our scenario we have already configured controlling area

1100 in e-book ‘Controlling configuration’. In the controlling
area settings for 1100 we have switched on the component
profit center active. A group which is a fast growing
group intends to have profit center based on product
lines. We therefore create profit center based on the product
lines.

Let us now proceed with the configuration of the profit center

module.
 2. Basic Settings

For doing the configuration we use the following path on the

SAP application screen: -

Menu Path
SAP Menu Æ Tools Æ Accelerated SAP Æ Customizing Æ
SPRO – Edit Project

Configuration for all the modules will be done here. The above
path will not be referred henceforth; we will directly refer to
the IMG node.
 2.1 Maintain controlling area settings

Menu Path

IMG Æ Controlling Æ Profit Center Accounting Æ Basic

Settings Æ Controlling Area Settings Æ Maintain Controlling
Area Settings

Update the following

The Dummy profit center will be updated, once we create
the dummy profit center.

We have switched on the elimination of internal business

which ensures that transaction data between two objects of
the same type that are assigned to the same profit center
(such as two cost centers or two orders) is not updated
in Profit Center Accounting.

Since material ledger is active for the A Grp, we select

the valuation view profit center valuation. 1f the material
ledger is not active we need to select Legal valuation.

ALE distribution method – We have selected no distribution to

other systems since we do not want to transfer data from one
system to another. In case we want to transfer master data
from one system to another (development to quality and
production system) we need to select another setting.

Click on Save
 2.2 Create Dummy Profit Center

Menu Path

IMG Æ Controlling Æ Profit Center Accounting Æ Master

Data Æ Profit Center Æ Create Dummy Profit Center

Double click

Update the following: -

Click
 2.3 Set Control Parameters for Actual Data

Menu Path

IMG Æ Controlling Æ Profit Center Accounting Æ Basic

Settings Æ Controlling Area Settings Æ Activate Direct
Postings Æ Set Control Parameters for Actual
Data

Click and update the following

We want online line item transfer to the Profit center

accounting module, therefore we make the following settings.
Click
 2.4 Maintain Plan Versions

Menu Path

IMG Æ Controlling Æ Profit Center Accounting Æ Basic

Settings Æ Controlling Area Settings Æ Activate Direct
Postings Æ Plan Versions Æ Maintain Plan Versions

Select the controlling area by clicking Extras Set controlling

area

Update 1100 as the controlling area.

Select version 0 Plan/Actual version

Double click

Click and update the following: -

Ex. Rt. Type P ± Std. translation for cost planning

You can consider even M (Std. translation at average rate)

Then maintain the control indicators for each fiscal year.

1f the lock indicator is selected, the plan version is locked.

This means that the plan data for that year cannot be
changed. This flag lets you protect plan data from being
changed once it is in its final form. 1f the indicator is not
selected, the plan version can be changed. 1f necessary, we
can remove the tick and then make our changes.

The flag online data transfer determines whether postings are

transferred to Profit Center Accounting simultaneously with
original activity. 1f the indicator is not selected, we need to
transfer the postings manually by fiscal year using the plan
data transfer function.

The Line items flag controls whether plan line items are
created when you change plan data. The line items document
every change made to a plan.

With the exchange rate type, we determine which rate - such

as the average rate or bank-selling rate - should be used to
translate the plan data in that version. 1f we do not put a
value date, the values will be translated using the exchange
rate valid on the first day of the month. With a value date, you
can set a date to be used for the translation.

Click
 2.5 Allow Balances to be Carried Forward

Menu Path

IMG Æ Controlling Æ Profit Center Accounting Æ Basic

Settings Æ Balance Carry forward Æ Allow Balances to Be
Carried Forward

Select and click button

 3. Master Data

3.1 Maintain Standard Hierarchy

IMG Æ Controlling Æ Profit center accounting Æ Master Data Æ Profit Center Æ

Maintain Standard Hierarchy

Menu Path

Position cursor on P9100 and click on

Update the following

Click on
Update the following

Click on

Update the following

Similarly update for other profit center groups such as power,

telecommunication, information technology and corporate,
which will look as shown below
Click
 3.2 Create profit center menu path change

Menu Path

SAP Menu Æ Accounting Æ Controlling Æ Profit Center

Accounting Æ Master data Æ Profit Center Æ Individual
Processing Æ KE51 Created

Update the following

Since the company code is already attached with the
controlling area, when creating the profit center, it is
automatically gets assigned to the right company code.

You can remove the assignment of any particular company if

you do not want the company to post to the profit center. For
e.g. company code 9200 is not into ethylene manufacture or
sale, it is only into Polylolefins. 1n that case you should
uncheck company 9200 from the profit center 1100.

In this documents, one company code is attached to one

controlling area.
Only for your reference it is shown how to remove the
company code assignment

Remove the tick in the check where it is desired to remove the

assignment.

Click to activate profit center

Similarly create other profit centers such as 1101, 1102, and

1103 under profit center group 11
Create profit centers under profit center group 12, 13, 14, 15,
16 and 99

Create a Corporate common profit center 9999 under the

profit center group 99.

For corporate profit center

Other master data sets such as statistical key figures need not be
created again in profit centers since they are already created in the cost
center accounting module. The transaction code for creating statistical
key figure is KK01.
 4. Transfer Prices (Optional)

4.1 Basic Settings for Pricing

Menu Path
IMG Æ Controlling Æ Profit Center Accounting Æ Transfer
Prices Æ Basic Settings for Pricing

Preset standard deliveries are provided for all components of

transfer pricing. The standard deliveries are displayed in the
left-hand screen area, together with condition types, pricing
procedures and transfer price variants which we have defined
our self.

By clicking on the individual elements, we can see the

corresponding settings in the right-hand screen area.
To define condition types, pricing procedures or transfer price
variants our self, click on create in the left-hand screen area.

The preset condition type TP01 (Transfer Price fix) is a fixed

price condition type.
To see the access sequence ZU01 click

Click

The access sequence ZU01 is as follows: -

Select

Double click

The condition records can be maintained either for each of the

following:-

• Plant, Material and receiver profit center

• Plant , Representative material and receiver profit center
• Dependent on material

Dependent on material - needs to be used for pipeline

material, since pipeline materials cannot be activated
for material ledger. These materials will not have group view
and the profit center view.
The other condition record TP02 (Markup percentage) is as
follows:-
 4.2 Define Account Determination for Internal Goods
Movements (Optional)

Menu Path

IMG Æ Controlling Æ Profit Center Accounting Æ Transfer

Prices Æ Settings for 1nternal Goods Movements Æ Define
Account Determination for 1nternal Goods Movements

Internal goods movements in Logistics (stock transfers,

materials usage for production orders, and so on) can lead
to an exchange of goods between profit centers.

To be able to show the material flow correctly in Profit Center

Accounting, we need to look at the profit center as an
independent company. This means that a sale is made by the
sending profit center, while the receiving profit center posts a
goods receipt.

This way of looking at postings in Profit Center

Accounting cannot be achieved based solely on the original
posting. We therefore need to make an additional account
assignment. A separate account determination generates
additional posting lines on the basis of the original document,
and then posts these in Profit Center Accounting.

The source document is not changed. Therefore this has no

effect on Financial Accounting (F1). However, note that these
lines are also updated in F1 since we are using transfer prices.

In this step, you enter the accounts that you need in

order to represent internal goods movements in Profit
Center Accounting for each controlling area.

The additional accounts must be defined as P&L

accounts in Financial Accounting (F1). Cost elements are not
permitted.
As seen in the following example, three types of
additional account are required:

• internal revenues
• internal change in stock
• deliveries from profit centers

Material withdrawal of semi-finished product material 1 (profit

center 1) for production order 2 (profit center 2) using
legal valuation in Profit Center Accounting and FI

For material withdrawals, the costs on the receiver profit

center are shown, plus an internal sale is assigned to the
sender profit center. On the receiving side, it may be necessary
(consumption of semi finished goods) to correct the posting
under "Change in stock" with a posting "Delivery from profit
center".

FI Posting:

Description Debit Credit

Change in stock of semi-finished 1000
Stock 1000

Profit Center Posting:

In profit center 1
Description Debit Credit
Internal change in stock 1000
Internal revenues 1000

In profit center 2
Description Debit Credit
Change in stock of semi-finished 1000
Delivery from profit center 1000
Internal change in stock 1000
The two lines "Change in stock" on the receiver side cancel
each other out. The transaction is an external delivery from
the point of view of the receiver profit center, which is reflected
in the line "Delivery from profit center".

Material withdrawal of a semi-finished product 1 (Profit center

1) for production order 2 (Profit center 2) using transfer prices

The stock value using legal valuation is 1000

The stock value using profit center valuation is 1200
The transfer price from semi-finished material is 1500

FI Posting:

In FI, only legal valuation is stored

Entry

Description Debit Credit

Change in stock of semi-finished goods 1000
stock 1000

PCA Posting:

In profit center accounting, profit center valuation is stored.

Profit center 1
Description Debit Credit
Internal revenues 1500
Internal change in stock 1200

Profit center 2
Description Debit Credit
Change in stock 1500
Internal change in stock 1500
Delivery from profit center 1500
You may want to leave out material types for operating
supplies which have little value. 1f you do not choose these
material types, only the consumption postings will be debited
to the profit center on the receiver side.

You can set up the account determination by:-

Material type
Valuation class
Valuation modification constant

Blank entries (e.g. without a valuation class) are interpreted

as generic entries. However, the material type must have at
least one entry.

In the field No receiver records you enter whether the system

should ignore the data records on the receiver side.

Assign the following GL codes

827100 1nternal Stock changes
827200 1nternal transfers
827000 1nternal revenues

Click and update the following: -

Note: All the GL codes above should be set as Post
automatically only in all the company codes which are
assigned to the controlling area.

Click
 4.3 Define Account Determination for Prod. Varian. in
Delivs to other Pctrs

Menu Path

IMG Æ Controlling Æ Profit Center Accounting Æ Transfer

Prices Æ Settings for 1nternal Goods Movements Æ Define
Acct Determination for Production Variances in Delivs to
other Pctrs

In transfer prices in cross-plant manufacturing, a price is

negotiated for goods delivered from one profit center to
another.

However, if the actual cost of goods manufactured differs

from the planned cost, we need an additional account in
which to post production variances. This account is necessary
so that we can settle the difference to the sender profit
center instead of the receiver.

In this step, we define the profit and loss account to which

we want to post production variances. We can define this
separately for each valuation class and valuation grouping
code.

Click and update the following: -

Click
 4.4 Define Special Handling for Internal Goods Movements

Menu Path

IMG Æ Controlling Æ Profit Center Accounting Æ Transfer

Prices Æ Settings for 1nternal Goods Movements Æ Define
Special Handling for Internal Goods Movements

All internal goods movements which are not represented

as material flow between profit centers are contained here.
E.g. scrapping a material: The table is pre delivered within the
standard SAP R/3 system.

1f any new movement types is created in Materials

Management, you need to check whether these lead to a
material flow between profit centers. 1f this movement
type should not be taken into account, we need to make an
entry in this table.
 5. Planning

5.1 Define Number Range for Local Documents

Menu Path

IMG Æ Controlling Æ Profit Center Accounting Æ Planning Æ

Basic Settings for Planning Æ Define Number Ranges Æ
Define Number Ranges for Local Documents

The number ranges in profit center are maintained year

independent by inputting year 9999

Click

Update the following: -

Click

Click
 5.2 Create Planning Layout - Costs/Rev., Bal. Sheet A/cs,
Stat. Key figures

Menu Path

IMG Æ Controlling Æ Profit Center Accounting Æ Planning Æ

Manual Planning Æ Planning Layout Æ Maintain Planning
Layout for Costs/Revenues, Balance sheet accounts,
Statistical key figures

We will copy from an existing SAP plan layout (8A-111) for

costs/revenue

Double click
Click

If you notice the layout has PrCtr report cur. , we need to

change it to company code
Double click

In the press
and

select

Double click
Click

Click
Click

Click
Similarly you need to change distrb key and unit field also to
company code currency

Let us add quantity and unit of measure to the existing layout

Position the cursor on the column next to Unit and Double

Click
Select

Click
Select quantity in the key figure

Double click

Click
Position the cursor next to quantity and Double Click and
select attribute

Click

Select Unit radio button

Click
Select quantity from the key figure

Double click
Click

Click

Click

Similarly distribution key for qty select Attribute

Position the cursor next to quantity and Double Click and

select attribute

Click
Click

Select quantity from key figure

Double click

Click
Click

Click . If no errors are found then click save

 5.3 Maintain Planner Profiles

Menu Path

IMG Æ Controlling Æ Profit Center Accounting Æ Planning Æ

Manual Planning Æ Maintain Planner Profiles

Here, we define planner profiles, which we can use

to organize our organization's planning. A planner profile
determines which planning layouts can be used with
which default parameters for each planning area.

We can enter any number of planning layouts for each

planning area. These layouts are sorted according to their
"Profile item" number. 1t is also possible to use the same
layout in different items of the profile, specifying different
default parameters each time.

Planner profiles help us structure our organization's

planning process, especially if our organization uses a
decentralized planning process. We can assign our users
planning layouts in which the objects they are allowed to
plan are predefined and not changeable.

1f you want to assign planner profiles to authorization groups,

you first need to carry out the step Maintain authorization
groups to define these. Authorization groups determine which
users can maintain which planner profile. You can assign
authorizations using the authorization object CO: Planner
profiles (K_TKA50).
Double click
Select

Click and update the following

Click
Click

Select

Double click and update the following: -

Click

Select

Double click
Delete the SAP standard layout by selecting the 2 items

Click

Click
Click

Maintain the entries as below

Click

Click

Select

Double click and update the following: -

Click

Click
Click

Comeback and attach the planning layout created for

statistical key figures to the planning area Statistical key
figures.

Click till you reach the main screen

Let us create planner profile for excel upload (decentralized)

A file description is a generic file name for use with integrated

Excel and with the Excel upload function that assigns the cells
in the Excel spreadsheet with those in the planning layout.

The system automatically enters a file description when we

save the generic file name for our Excel template. 1f you want
to use the same layout more than once, you can enter the
generated file description for the next planning layout
Double click
Select

Click and update the following

Click

Click

Select

Double click and update the following: -

Click

Select

Double click

Delete the SAP standard layout by selecting the 2 items

Click

Click

Maintain the entry as shown above

Click save

Select

Double click
Click
Click

Click

Click

Click

Now when you go back you will find the file description
created.

Click
 5.4 Define distribution

Menu Path

IMG Æ Controlling Æ Profit Center Accounting Æ Planning Æ

Allocations Æ Define Distribution

Cycle definition in a cross company code-controlling scenario

should start with the company code such as 91. Further it
should reflect in abbreviated form the distribution such as
General Administration cost cycle 1 and that it is a planned
cycle.

Thus the cycle name is 91GA1P

Double click

Click

Update as shown below

Click

Maintain the entries as shown below

Click

Maintain the entries as shown below

Click
Click and maintain entries as shown below
Click
Click
Click

Click and check the cycle settings

Click
 5.5 Create Assessment cost elements

Menu Path

IMG Æ Controlling Æ Profit Center Accounting Æ Planning Æ

Allocations Æ Create Assessment Cost Elements

Update the following: -

Click

Similarly create assessment cost element for CO production

costs
 5.6 Define Assessment

Menu Path

IMG Æ Controlling Æ Profit Center Accounting Æ Planning Æ

Allocations Æ Define Assessment

Update the following: -

Double click and update the following:

Click

Update the following

Click
Click

Click and update the following

Click

Click

Click
 6. Actual Posting
6.1 Maintain document types

Menu Path

IMG Æ Controlling Æ Profit Center Accounting Æ Actual

Posting Æ Basic Settings: Actual Æ Document Types

This option lets us define which document types are valid for
allocating actual data (assessment and distribution) and
creating profit center documents.

The three columns for the transaction currency,

local/company code currency and third currency determine
which currencies are stored for this document type. Select all
three.

The information on the number ranges used for local and

global ledgers are only displayed here. 1t is defined here
automatically for when we maintain number ranges for this
document type later.

The profit center ledger "8A" is a local ledger.

The document type A0 is relevant
Here you attach Balance Check:-

Double click
Click

In case there is a difference in F1 PCA and in case you need to

pass a single entry in PCA you can select the balance check
indicator 2 No balance check.

Normally we don’t need to configure here anything.

 6.2 Define Number Range for Local Documents

Menu Path

IMG ÆControlling Æ Profit Center Accounting Æ Actual

Postings Æ Basic Settings: Actual Æ Define Number Ranges
for Local Documents

This step is already done in earlir step, when we have copied

the number range.
 6.3 Maintain Automatic Account Assignment of Revenue
Elements (OKB9)

Menu Path

IMG ÆControlling Æ Profit Center Accounting Æ Actual

Postings Æ Maintain automatic account assignment of
revenue elements

Here we can assign revenue elements and sales deductions to

profit centers. The system automatically enters the specified
profit center in the primary line items of the revenue elements.

Normally we do not have to maintain anything here, since the

profit centers are determined from the material master into the
sales order. But if we want to default some other profit center,
we can do so.

The configuration is you select company code, cost element,

order and enter profit center.

This particular configuration can also be called from the

SAP easy access menu by entering OKB9 in the command
field.
 6.4 Choose Additional Balance Sheet and P&L Accounts
(3KEH)

Menu Path

IMG ÆControlling Æ Profit Center Accounting Æ Actual

Postings Æ choose additional balance sheet and P&L Accounts

Here we define which accounts or account intervals we want to

transfer to Profit Center Accounting. 1t is imperative that we
maintain all the GL accounts which need to be transferred to
Profit center. Needless to say that if we don’t maintain the
GL accounts here, the balance will not be transferred to
PCA.

This setting is also particularly required, if no profit

center is entered for a specific transaction in one of
these GL accounts, the system posts to the default profit
center for that account interval.

This particular configuration can also be called from the

SAP easy access menu by entering 3KEH in the command
field.

Note that the GL codes for Customers and Vendors

including Advances (special GL account) which are called
Reconciliation accounts should not be maintained in the
3KEH table. Reason being the Customers and Vendors line
items are not transferred to the PCA module online. We
have to run month end programs to transfer Customer and
Vendor balance from F1 module to PCA module

These are GL codes which are reconciliation accounts for

customer and vendors, that should be excluded from the
3KEH table.
USCA 119020 1100 Accounts Receivables -Third Parties
USCA 119025 1100 Accounts Receivables -Bills of Exchange

USCA 119030 1100 Accounts Receivables –Inter Company

USCA 119050 1100 Accounts Receivables –SWAP & Exchange Customers

USCA 119060 1100 Accounts Receivables –Old Customers

USCA 119740 1100 Accounts Receivables – Employee Receivable

USCA 119770 1100 TR-LO Reconciliation Account – Receivable

USCA 119771 1100 TR-LO Reconciliation Acct – Repayment receivables

USCA 119772 1100 TR-LO Reconciliation Account – Interest Receivable

USCA 119773 1100 TR-LO Recon.Acct.– Payment oblig. For loans

USCA 119774 1100 TR-LO Reconciliation Account – Premiums

USCA 119775 1100 TR-LO Reconciliation Account – Payment adjustments

USCA 119806 1100 Noted items - General

USCA 119807 1100 Noted items – Outgoing Payments

USCA 119820 1100 Noted items – Vendor down payments

USCA 212030 1100 Account Payable – Trade Inter company

USCA 213000 1100 Account Payable – Trade Partner

USCA 213320 1100 Account Payable – Trade Third parties

USCA 213350 1100 Account Payable – SWAP & Exchange Vendor

USCA 213370 1100 Account Payable – Trade Old vendor

USCA 215200 1100 Account Payable – Non Trade Third parties

USCA 215300 1100 Account Payable – Employee Payable

USCA 219906 1100 Noted Items - General

USCA 219907 1100 Noted Items – Outgoing payments

USCA 219924 1100 Customer Down payments

Click and update the following: -

Click
 7. Period end closing
7.1 Define Distribution

Menu Path

IMGÆ Controlling Æ Profit Center Accounting Æ Actual

Postings Æ Period-end closing Æ Define Distribution

Actual cycles are copied from plan cycles. The only changes
required to be done are instead of statistical key figures you
need to update actual statistical key figures.
Double click

Click

Click
Click to the next copied segment
Click

Click

Click
 7.2 Define Assessment

Menu Path

IMG Æ Controlling Æ Profit Center Accounting Æ Actual

Postings Æ Period-end closing Æ Define Assessment

Actual cycles are copied from plan cycles. The only changes
required to be done are instead of statistical key figures you
need to update actual statistical key figures.

Double click

We will copy plan assessment cycle into actual assessment

cycle.
Suffix the actual cycle with A instead of P

Update the following:-

Click
Click
Change to
Click
Change to
Click

Click
 SAP Profit Center
Accounting
Configuration
SAP R/3 ENTERPRISE ECC6
Published by Team of SAP
Consultants at SAPTOPJOBS
Visit us at www.sap-topjobs.com

Copyright 2009-11@SAPTOPJOBS

All rights reserved. No part of this publication may be

reproduced, stored in a retrieval system, or transmitted in any
form, or by any means electronic or mechanical including
photocopying, recording or any information storage and
retrieval system without permission in writing from
SAPTOPJOBS.