SAP CO Module

The SAP CO (Controlling) Module provides supporting information to Management for the purpose of planning, reporting, as well as monitoring the operations of their business. Management decision-making can be achieved with the level of information provided by this module.

Some of the components of the CO(Controlling) Module are as follows:

1. Cost Element Accounting
2. Cost Center Accounting
3. Internal Orders
4. Activity-Based Costing ( ABC)
5. Product Cost Controlling
6. Profitability Analysis
7. Profit Center Accounting

Cost Element Accounting component provides information which includes the costs and revenue for an organization. These postings are automatically updated from FI (Financial Accounting) to CO (Controlling).

Cost Center Accounting provides information on the costs incurred by your business. Within SAP, you have the ability to assign Cost Centers to departments and /or Managers responsible for certain areas of the business as well as functional areas within your organization. Cost Centers can be created for such functional areas as Marketing, Purchasing, Human Resources, Finance, Facilities, Information Systems, Administrative Support, Legal, Shipping/Receiving, or even Quality.

Internal Orders provide a means of tracking costs of a specific job , service, or task. Internal Orders are used as a method to collect those costs and business transactions related to the task.

Activity-Based Costing allows a better definition of the source of costs to the process driving the cost. Activity-Based Costing enhances Cost Center Accounting in that it allows for a process-oriented and cross-functional view of your cost centers. It can also be used with Product Costing and Profitability Analysis.

Product Cost Controlling allows management the ability to analyze their product costs and to make decisions on the optimal price(s) to market their products. It is within this module of CO (Controlling) that planned, actual and target values are analyzed.

Profitability Analysis allows Management the ability to review information with respect to the company’s profit or contribution margin by business segment.

Profit Center Accounting provides visibility of an organization’s profit and losses by profit center. The methods which can be utilized for EC-PCA (Profit Center Accounting) are period accounting or by the cost-of-sales approach.

Source:

http://www.thespot4sap.com/IntroTo/SAP_CO_Module_Introduction.asp