Cost Center Accounting Allocations(Plan) in SAP CO

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ALLOCATIONS enable you to periodically allocate amounts and quantities from sender objects to receiver objects. The two main types of allocations are assessment and distribution. You can allocate both plan and actual data. In cost center accounting allocations, the system allocates plan costs from sender cost centers or business processes to internal orders.

If you have already planned all costs in PRODUCTION COST CENTERS ( as studied in the previous section) and decided the place where they will be allocated, then you can skip to the next step of plan allocations. If you have planned costs and where they are incurred in overhead cost centers, you will need to use plan assessments and/or distributions to allocate costs.

The difference between assessments and distributions is that distributions maintain the identity of the original cost in the sending cost center. In other words, the primary cost element (source cost) is allocated to another cost center and posted to the same primary cost element. This allows you to see the original primary cost element in the receiving cost center, but doesn’t make it apparent that the cost was the result of an allocation.

Assessments use secondary cost elements in order to move costs. Secondary cost elements act as cost carriers and therefore, lose the identity of the primary cost element. This is often the preferred method because you can clearly see that a debit in a cost center was the result of a cost assessment versus other debits that were original postings in that cost center.

You can choose to use assessments or distributions only, or use a mixed process. Plan assessments are created in transaction KSU7 and executed in transaction KSUB (see Figure 2.22 and Figure 2.23).

    Figure 2.22: Create plan assessment cycle header data

Figure 2.23: Create plan assessment cycle: segment header

Distributions are created in transaction KSV7 and executed in transaction KSVB (see Figure 2.24).

Figure 2.24: Create plan distribution cycle header data

Figure 2.25: Create plan distribution cycle segment header

After costs are allocated, it is important to review the cost center Actual/Plan/Variance report using transaction S_ALR_87013611. Ensure that the allocations credited sending cost centers and debited receiver cost centers. You can reverse assessments and distributions, if the results are undesirable using the execute transactions (KSUB or KSVB).

Matching plan assessment and distribution cycles

Plan assessment and/or distribution cycles should match your actual assessment and distribution cycles. For example, if you plan to use assessment cycles at month end to move actual costs, you should set up the same plan assessment cycles to simulate the movement of costs. This allows you to better anticipate actual cost center postings through analysis of cost center planning.

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