How to maintain controlling area in SAP

How to maintain controlling area in SAPControlling area in SAP CO module is a central organizational unit under which all the internal reporting takes place. In SAP you can use transaction code OKKP to define CO area or you can use following path to maintain it.

Path for Creation : SPRO > IMG > Controlling > Organisation > Maintain Controlling Area

You have two options for creating CO area;

  • Create a New One or
  • Copy an existing one to Create your own CO area

To copy an existing controlling area you can use the transaction code EC16. To create it you use transaction code OKKP.

If you want to maintain and assign company code to a controlling area separately then transaction code OX16 and OX19 can be used. 

What are the prerequisite of creating a CO area?

Before creating a CO area you must have following settings in SAP;

  • The enterprise structure or organizational structure should have been defined and approved by the business process team.
  • You must decide the currency you want to use.
  • Company Codes should have been created in sap to get assigned.
  • Operating Chart of Accounts should be created to get assigned to your controlling area. Operating chart of accounts for all the company codes under one controlling area must be same.
  • Fiscal year variant should have been created in Financial Accounting. All company codes assigned to a controlling area must use the same fiscal year variant.

You can define your cost center hierarchy while creating a controlling area. You just need to enter the name of the cost center hierarchy in the field of cost center hierarchy and press enter. System will display a message that the cost center hierarchy does not exist and would you like to create it. Click on yes to create your cost center hierarchy.

You have an option of creating the cost center hierarchy from the SPRO menu or through transaction code OKEON but you cannot initially create your cost center hierarchy from that screen if you choose to create CO area from OKKP transaction.

If initially you have defined your CO area from transaction code OX16 then after it’s creation, cost center hierarchy can be created through transaction code OKEON. After its creation you can assign it to controlling area by using transaction code OKKP.

Relevant Points for Creation of CO Area

  • You can create it with a four digit number or alphanumeric figure or any name in combination of that. But SAP will not allow more than 4 digits to name a controlling area.
  • Before creating your CO area you need to create all the company codes that you want to assign it. After its creation if you want to add another company code then that can be done by using transaction code OKKP.
  • One CO area can be assigned to many company codes but one company code cannot be assigned to more than one CO area. If you want to consolidate different company codes having different operating chart of accounts which are also assigned to different controlling areas then you need to use the functionality of group chart of accounts in SAP FI module.

When you save your CO area settings SAP will ask you for a transport request to save it. You can either create one transport request or you can assign the previous used transport request to it.

Fields while maintaining CO area settings

Controlling area

You can define it with a four digit alphanumeric number.

Name

Enter a description to describe it.

Person Responsible

If you want any specific person to be responsible then create it in sap and assign it here.

COArea=CCode

This field will define the company code relationship with the controlling area. If you want one to one relationship then (i.e. one CO area for one company code) you must select the first option i.e. “CO area same as company code”.

If you have decided for one to many relationship (i.e. more than one company code to be assigned to one controlling area) then the second option need to be selected i.e. “cross-company cost accounting”

Currency type and Currency

You have following options to choose out of the drop down available in SAP.

10        Company code currency

20        CO area currency

30        Group currency

40        Hard currency

50        Index-based currency

60        Global company currency

You can choose it based on the discussions with your business process team. If you chose currency as 10 then the company code currency and controlling area currency will be same.

If you have chosen currency type as 20 then the controlling area currency will be different from the company code currency and that need to be assigned in the next field available “Currency”.

If you chose group currency as your controlling area currency then you need to define it in SAP and then assign the currency in the currency filed after selecting the type of currency here. Group currency is assigned to reconcile controlling area ledgers with the financial accounting.

Currency 50 is used where the country has a high inflation.

Currency 60 is used where you have global companies.

Chart of Account

All company codes assigned under one controlling area must use one operating chart of accounts. If you planned to use company code with different operating chart of accounts then that will not work here. You need to create separate controlling on the basis of operating chart of accounts used. If you select controlling area same as company code then SAP will by default populate these fields.

Fiscal year variant

You can assign any fiscal year variant to your controlling area but the fiscal year variant must be the same for all company codes assigned to the controlling area.

Activate Components

On the left screen you will have an option for activation. You need to double click on this to get it opened. Put the fiscal year as today’s year, system will automatically select the last fiscal year as 9999.

In this screen you will have lots of activation bottom to select like cost center, order management, commitment management, profitability analysis, activity based costing and other tabs to be activates. These fields are to be activated when you use there respective sub module.

For the time being you activate all the available bottoms and proceed to the next tab available in the left hand side of the screen “assign company codes”.

Assign Company Code

Based on the operating chart of account you have selected a drop down will be available for assignment. You can select those company codes for which you want controlling area to be activated. It is not mandatory that you need to assign all the company codes to it.

After creation of a controlling area you need to assign a number range for it by which all the CO documents posted under it will carry a number from the number range settings. Controlling area setting for your CO module is the first step to get started your internal reporting in SAP. So you need to plan before you create one.

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