| The SAP FI (Financial Accounting) Module has the | | | | areas of the business as well as functional areas |
| competence of meeting all the accounting and financial | | | | within the SAP. Cost Centers can be created for such |
| needs of an organization. Along with other managers, | | | | functional areas as Marketing, Purchasing, Human |
| Financial Managers within your business and same | | | | Resources, Finance, Facilities, Information Systems, |
| module can review the financial position of the | | | | Administrative Support, Legal, Shipping/Receiving, or |
| company in real time as contrasted to legacy systems | | | | even Quality. |
| which necessitate overnight updates before financial | | | | Some of the benefits of Cost Center Accounting: |
| statements frequently and can be generated for | | | | (1) Managers can set Budget/Cost Center targets |
| management review. The real-time functionality of the | | | | (2) Cost Center visibility of functional areas of your |
| SAP modules allows for better decision making and | | | | business |
| strategic planning. The FI Module incorporates with | | | | (3) Planning |
| other SAP Modules such as MM (Materials | | | | (4) Availability of Cost allocation methods and |
| Management), PP (Production Planning), SD (Sales and | | | | (5) Assessments of costs to other cost objects. |
| Distribution), PM (Plant Maintenance), and PS (Project | | | | Internal Orders provide a means of tracking costs of a |
| Systems). The FI Module also assimilates with HR | | | | specific job, service, or task. Internal Orders are used |
| (Human Resources) that includes PM (Personnel | | | | as a method of gathering those costs and business |
| Management), Time Management, Travel | | | | transactions that are linked to the task. This level of |
| Management, Payroll. Document transactions occurring | | | | monitoring can be very detailed but allows |
| within the precise modules generate account postings | | | | management the ability to review Internal Order |
| by means of account determination tables. | | | | activity. Activity-Based Costing authorize a better |
| The SAP CO (Controlling) Module endow with | | | | definition of the source of costs to the process driving |
| supporting information to Management for the purpose | | | | the cost and it also enhances Cost Center Accounting |
| of planning, reporting, as well as monitoring the | | | | that allows for a process-oriented and cross-functional |
| operations of their business. Management | | | | view of your cost centers. Product Cost Controlling |
| decision-making can be achieved with the level of | | | | allows management the capability to examine their |
| information provided by this module. The Cost Element | | | | product costs and to make decisions on the optimal |
| Accounting component provides information which | | | | price to market their products. The methods which can |
| includes both the costs and revenue for an | | | | be utilized for EC-PCA (Profit Center Accounting) are |
| organization. These postings are updated automatically | | | | period accounting or by the cost-of-sales approach. |
| from FI to CO. The cost elements are the foundation | | | | Profit Centers can be set-up to identify product lines, |
| for cost accounting and facilitate the User the ability to | | | | divisions, geographical regions, offices, production sites |
| display costs for each of the accounts that have been | | | | or by functions. Profit Centers are used for Internal |
| assigned to the cost element. Cost Center Accounting | | | | Control purposes enabling management the ability to |
| provides information on the costs incurred by your | | | | review areas of responsibility within their organization. |
| business. You have the ability to assign Cost Centers | | | | Ron Victor is a SEO copywriter for He written many |
| to departments and managers responsible for certain | | | | articles in various topics. |