Transactions are not posted directly into controlling module. It flows from different module. Reposting, distribution and assessment in SAP used in controlling module to allocate costs within the module between cost centers and other cost objects. Both methods produce the same result. The costs being transferred from a cost object and collected in another cost object.
Distribution in SAP : A business transaction that allocates primary costs from one cost object to another cost object. The above methods of allocation of cost are maintained through cycle- segments. A cycle is a collection of rules for cost allocation. A specific cycle contains a number of segments. Cycles are valid only in the environment in which they are defined. The sender-receiver relationships defined in a cycle are processed iteratively.
Difference between reposting, distribution and assessment in sap is a common question asked by interviewer. If you are preparing for your SAP interview then its very important to know the difference. If you have any other question of reposting, distribution and assessment then please let us know. We will try to address that issue here.
What is the difference between Assessment and Distribution allocation method?
Reposting in SAP is used to rectify incorrect postings. Reposting by line-item Reposting by cost. The original cost elements are retained in the receiver cost center. Information about the sender and the receiver is documented in the Controlling document. The following information is passed on to the receivers: The original cost elements are combined into assessment cost elements i.
The original cost elements are thereby lost. The sender and receiver information the sender cost center and the receiver cost center or order are documented in line items.This document aims to cover the relevant config required for new GL allocation.
Allocations in General Ledger enable one to periodically allocate amounts and quantities from sender objects to receiver objects. The two main types of allocations are assessment and distribution. One can allocate both plan and actual data. Allocation rules are used to determine how amounts and quantities should be allocated from sender object to receiver object.
SAP recommends performing assessments and distributions at the cost center level in Overhead Cost Controlling, although it is technically possible to perform them in the new General Ledger. The basis of Allocation is defined in Allocation Cycles. Here we define how a particular Dimension in General ledger will be used in the GL Distribution cycles. You should enter company code as a single value at the cycle level so that the allocation is processed without any problems. A cross-company code distribution is not possible.
Field Name. M andatory. Summary table for which the Allocation field is being defined. Field name for which the settings are being defined. Whether it is for Actual or Plan Allocation. This field controls whether the table field appears in the results list following allocation. If the table field is to be displayed, activate the control field. Fields not thus specified appear in alphabetical order. Normally, summarization is carried out automatically via a field that is not called in the segment.
If this indicator is set, the sender values of this field are always received in the receiver values, even if this field is not defined in the segment definition.Assessment was created to transfer primary and secondary costs from a sender cost center to receiving controlling objects.
During assessment, cost centers or business processes can be used as senders. You can restrict the number of receiver categories in customizing. As the system writes fewer totals records, the assessment. Instead, the totals record for the cost element is reduced on the debit side, which. The information. This means that the partner can be displayed in the information system.
See customizing for an example with figures that illustrates this aspect. Under utilities. Its a method of internal cost allocation by which you allocate the costs of a sender cost center to receiver CO objects such as orders and other cost centers using an assessment cost element.
The costs from the cafeteria cost center could be assessed based on the statistical key figure "employee", which was set up on the receiver cost center. Receiver cost center I has 10 employees, receiver cost center II has The credit on the cafeteria cost center and the debit of the two receiver cost centers are posted using an assessment cost element.
Depending on the system setting, the total costs or some of the costs for the cafeteria cost center would be debited. Distribution: When u run the distribution cycle, each cost element from the sender cost center is distributed to all the receiver cost center.
So after running the cycle, in the sender cost center, all the cost elements have corressponding credit cost elements. And in the receiver cost center, all the cost elements wise are shown in the receiver cost center.
Assessment: When u run the assessment cycle, the total of the sender cost center is asigned to the recerver cost centers as per the assessment cycle. Not what you're looking for?
Search community questions. This question has been deleted. This question has been undeleted. Former Member. Posted on Aug 24, at AM 1. Hi, Can any one help me regarding the above Difference between Distribution and Assessment cycle Thanks in advance Rajani. FIN Finance. Add comment. Related questions. Sort by: Votes Newest Oldest. This answer has been deleted. This answer has been undeleted.
Posted on Aug 24, at AM. Hi, Assessment is cost allocation tool is used for primary and secondary cost allocation. Alert Moderator. You already have an active moderator alert for this content. HI, Assessment: Assessment was created to transfer primary and secondary costs from a sender cost center to receiving controlling objects. As the system writes fewer totals records, the assessment has a better performance than periodic reposting and distribution.
The system does not display the original cost elements in the receivers.In distribution we allocate primary costs of a cost center. Assessment is a method of allocating primary and secondary costs.
In assessment we have to assign primary cost element or group of primary cost element to assessment cost element. Primary cost element is retained in Distribution whereas its not retained in Assessment. Allocation through assessment is useful when the composition of the costs is unimportant for the receiver.
For example, the assessment of cafeteria costs to a cost center need not be broken down further. Allocation is a process of assessing or distributing amounts and quantities from one sender object to one or more receiver objects - for example, from one cost center to multiple cost centers. The two main types of allocations are assessment and distribution.
You can allocate both plan and actual data. You perform the allocation using the allocation cycle function. You use allocation rules to determine how amounts and quantities should be allocated from sender object to receiver object. To effect the allocation, you have to make various settings in Customizing.
The assessment process posts the sender amounts to an assessment account. The SAP system then allocates the amounts from the assessment account to the receiver s - not directly from the original sender account. The assessment works in the same way as the distribution. However, with the assessment, the debit and credit postings do not occur under the original account or the original cost element but under an assessment account or an assessment cost element.
The distribution process distributes the balance s from the original sender s to the receivers. The original sender account is credited and the original receiver account is debited by the distribution.
Not what you're looking for? Search community questions. This question has been deleted. This question has been undeleted. Former Member. Posted on Jul 10, at AM 1. HI, What is the difference between Assesment, Distribution and allocation. Thanks in Advance, Regards, Chandu. FIN Controlling.If i understand you correctly,you will book energy cost to one cost center and end of the month you will allocate to other cost centers.
Assessment is an activity that you perform periodically, during the period-end closing in Overhead Cost Controlling CO-OMin which primary and secondary overhead costs are assessed from one or more sender objects to one or more receiver objects. Assessment means that the sending cost center is credited and the receiving cost center is charged under a freely definable secondary cost element.
The original cost elements that were charged by the sender cost center are lost, and are converted to one or more assessment cost elements secondary cost elements. Assessment groups together the posted primary and secondary costs and allocates them to the receiving cost center s in an assessment cost element. The cost centers for assessment are the quality lab, IT, cafeteria, housekeeping and plant security.
For example, you could assess the cost from the Reception cost center to the other cost centers based on the headcount managed in those cost centers. Distribution is an activity that you perform periodically, during the period-end closing in Overhead Cost Controlling CO-OMin which primary overhead costs are distributed from one or more sender objects to one or more receiver objects.
Many documents in Financial Accounting involve overhead costs. A clear allocation to one or more cost centers is not possible, or only with a major effort. You can use the allocation cost centers and internal orders as auxiliary constructs in such cases. During distribution, these costs are allocated distributed from their allocation cost centers to the actual receivers according to freely definable rules.
The sender cost center is credited, and the receiving cost center charged, under the original cost element. In contrast to periodic reposting, however, the accounting information is lost in the process. Not what you're looking for? Search community questions. This question has been deleted. This question has been undeleted. Former Member. Posted on Aug 06, at AM 2. Hi at all, 1. We receive a monthly invoice for electricity etc. We put the hole amount in one Cost Center.
Is there a way to automate this? It can be really annoying. FIN Controlling. Add comment. Related questions. Sort by: Votes Newest Oldest.
Best Answer. This answer has been deleted. This answer has been undeleted. Ratnakar Venkat. Posted on Aug 06, at PM. Hi Markus, If i understand you correctly,you will book energy cost to one cost center and end of the month you will allocate to other cost centers.Welcome to my first blog post.
Before deep-diving into the capabilities of Universal Allocation, let me quickly give an overview of Cost Allocation and the need of it in simple terms.
In every organisation, there are various types of cost involved in different departments; each department can have particular ways of running their day to day operations which can have direct or indirect incurred cost.
Think about a dynamic organisation with complex processes where daily activities are taking place, which involves cost. To showcase the same at the reporting level, we need the Cost Allocation planning, which has two allocations methods in SAP:.
Why the need of the hour? To answer this, let me quickly explain to you what were the challenges faced in the earlier process of Cost Allocations.SAP CO: Distribution and Assessment Task
It lacked the traceability of the data involved; also, the granular visibility at the reporting level was missing. At the same time, failed to explain them to the related stakeholders.
The entire process to show cost allocations involved various tcodes and core tables which was later simplified to a great extent by the concept of SAP Universal Journal which plays a vital role in the Universal Allocation process.
Besides, significant benefits are as follows:.
To know more on the above three, I will try to write another blog; else one can reach out to me for any clarifications. The two main apps to be used are: one is Manage Allocation, where you can find the standard allocation cycles available which can be extended and changed as well. At the same place, you can configure them as well. Below are the few relatable screenshots from the system:. The other app is- Run Allocationswhere we get an option of running the allocation cycles in test mode to see how the data will look and then run it in live mode.
Another feature available here is — Reversal of allocation cycles.
SAP Cost Allocation
Let me give you a scenario here, for a presales person to showcase the demo of Universal Allocation multiple times can be a task as that much of data should be configured in the demo system. Now to deal with this- Recently I have prepared a demo, where I have just maintained data for a single month and year, and with the help of reversal feature of allocation cycles, presales person can run the demo as many times as we want and showcase it in the reporting level with ease.
There is still a lots of scope which can make this process even worth more, like having a single source of truth universal journal comprising of profitability analysis and also a feature of running the allocation cycles through job scheduling and many more. I hope this blog post finds the right audience and might interest them. As this is my first blog post, I am very much keen about the feedback and response on this. Allocation cycles in OP are not present by default, you can create one as per your requirement and use it.
Personal Insights. Prakhar Saraswat. Posted on September 16, 4 minute read. Cost Allocation via Universal Allocation. Follow RSS feed Like. Hello Everyone, Welcome to my first blog post. Now, how to report the accurate costing flow in the most efficient way?
To showcase the same at the reporting level, we need the Cost Allocation planning, which has two allocations methods in SAP: Distribution Primary Cost Element Assessment Secondary Cost Element During the period-end closing activities, various organisations use the above-stated methods.
Besides, significant benefits are as follows: Easier Data reconciliation. Efficient analysis at the reporting level. Month-end activities. The allocation process debits the requesting cost centers and credits the cost centers that provided the services. With the allocations features, you can manage and perform various overhead allocation and distribution tasks for different allocation contexts, such as cost centers or profit centers. You can periodically allocate amounts and quantities from sending objects to receiving objects.
Features: Customers can quickly identify possible financial effects of changed allocation rules on their financial data. Allocations for cost centers, you can now perform allocations for profit centers. Provides one architecture for FI and CO allocations.Welcome to the SAP cost allocation tutorial. In every organization, there are costs involved in various departments.
In this tutorial, we will discuss how these costs can be allocated across different SAP cost objects like cost center or internal order and help to create a cost analysis report. Let us look at a simple example on how cost allocation comes into effect and why it becomes the most integral part of controlling. This company deals with after-sales services including repair and refurbishment services for products like laptops, PC, LCD monitors, etc. Each of the departments has its own mode of operation running daily which incurs significant amount of cost which can be attributed as Direct and also Indirect.
CSN management has come out with a strategy on how these costs can be charged to each impacted cost center to come out with the most efficient costing report. This is where cost allocation planning comes to the picture where the company will consider impacted cost centers where costs will be allocated in related proportion. In the allocation planning, amount and quantities will be periodically determined and allocated from sender cost objects like cost center to receiver cost objects.
In this case, we will be using CSN departments as primary cost centers which will act as both sender and receiver cost objects. In this tutorial, we will try to understand different cost allocation methods in SAP which a successful organization can adapt in order to get clear insight about its cost accounting report.
SAP provides the most systematic foundation on how cost allocation process can contribute to the effecting reporting related to cost management. The following image will give us a good idea on organizational structure of CSN.
As we know, in Controlling there are two kinds of cost elements. Primary Cost Elements Secondary Cost Elements These cost elements are maintained based on specific category, so that they can be used for reposting, cost assessment and revenues inside the CO.
Within cost center accounting and overhead cost controlling, allocations plays a vital role enabling the business users to periodically allocate amounts and quantities from sender cost objects to receiver cost objects based on cost center allocation planning and structure. Both actual and planning data can be allocated from sender cost object to receiver cost object in SAP cost allocation process using allocation cycle.
SAP Cost Allocation Methods Taking the above scenario where primary cost elements and secondary cost elements are listed within a company and there is a requirement of correct cost evaluation from operation perspective, SAP recommends the following two types of Cost Allocation process: Distribution — for Primary Cost Element Assessment — for Secondary Cost Element SAP Cost Allocation Method — Distribution Distribution process is mainly used for allocating the amount and quantities both plan and actual of one or more sender cost objects to multiple receiver cost objects.
Generally, in this type of SAP cost allocation, debit and credit of amount and quantities between sender cost objects e. CSN has occupied building which is shared by its department as listed above in the structure.
To address this requirement, SAP propose to define distribution process within the system since it is related to allocation of costs incurred within primary cost elements. In SAP, there is customizing related to calculation of both actual and planning overhead rates. On the following screenshot, rates of overhead are related to planning.