Level of profit centers

Hi All
Could you please tell at what level ( level 5 or level 9 ) are the profit centers
maintained in SAP. For example how to find the level of FRBs in the table
BSIS.
Also if anybody can explain me the concept of cost centers, profit centers
and cost center groups.
Regards
Ankit

Hi Ankit,
i am giving the defination of cost centre, profit centre
Cost centres are divisions that add to the cost of the organisation, but only indirectly add to the profit of the company. Examples include Research and Development, Marketing and Customer service. A cost centre is often identified with a speed type number.
Because the cost centre has a negative impact on profit (at least on the surface) it is a likely target for rollbacks and layoffs when budgets are cut. Operational decisions in a contact centre, for example, are typically driven by cost considerations. Financial investments in new equipment, technology and staff are often difficult to justify to management because indirect profitability is hard to translate to bottom-line figures.
Business metrics are sometimes employed to quantify the benefits of a cost centre and relate costs and benefits to those of the organisation as a whole. In a contact centre, for example, metrics such as average handle time, service level and cost per call are used in conjunction with other calculations to justify current or improved funding.
Profit Center Accounting provides visibility of an organizations 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. Profit Centers can be set-up to identify product lines, divisions, geographical regions, offices, production sites or by functions. Profit Centers are used for Internal Control purposes enabling management the ability to review areas of responsibility within their organization. The difference between a Cost Center and a Profit Center is that the Cost Center represents individual costs incurred during a given period and Profit Centers contain the balances of costs and revenues.
nagesh

Similar Messages

Classic profit centers reporting full b/s below company code level

Dear Experts,
we are using classic profit center. How to get Profit center wise balance sheet below company code level.
Facing issues for balance sheet GL accounts as at 3KEH one profit center i can choose...my requirement is to get 2 balance sheets for two profit centers.
any suggestions ?
Regards,
Sekhar

Hello Sekhar,
With Classic profit center accounting correct balance sheet cannot be ensured at Profit center level.
This is due to following reasons
1. Vendor/ Customer line items -
No assignment of Vendor/Customer recon accounts to Profit center in 3KEH.
But in period end you have to execute F.5D and 1KEK to transfer this values to Profit center accounting based on the offsetting line items.
This also might create problems if you don't clear the open items on period end as your Sales/Purchase will go to one Profit center and Payment will go to other (defaulted for Bank/Cash). Cleared items are not transferred
Also, Transaction between Vendor and Customer will lead to some values posting in Dummy profit center.
2. Asset line items
Profit center will be determined by Asset master
3. Tax accounts
Mostly it has to go with Default Profit center. SAP has given option for re-determination of Tax line items profit center based on off-setting line items during period end (Tax account should be assigned to Dummy profit center in 3KEH). But this will work only for Sales/Purchase transaction, as payment will go to default profit center used for Cash/Bank. Again it might lead to confusion.
4. Material accounts
Profit center assigned in Material master is used.
5. Other Balance sheet accounts
These accounts like Bank, Cash, loan etc has to be assigned to default Profit centers using 3KEH. Else, user has to enter the correct Profit center during entry. If missed out, it will go to default profit center. Remember, balance sheet accounts not included in 3KEH (except for Vendor/Customer) will not be transferred to Profit center accounting itself.
Hope it helps..
Thanks & Regards,
Muneer Ahamed N

Default profit centers Plant wise for Balance Sheet tax relevant Items.

Dear All,
We have an issue in profit center acccounting.
In balance sheet accounts, Vat input tax payable, TDS payable, Cenvat clearing etc are picking profit center from 3KEH. When Exicse is getting captured cenvat clearing account having the profit center but while doing the MIRO cenvat clearing do not have profit center & plant.
Why it is so?
Basically we are doing the following steps.
1. Purchase order creation ME21N.
2.Goods received via migo
3. invoice receipt via miro.
At the time of miro posting, system creates automatically accounting document, with default profit center maintained in 3KEH, which are assigned to Vat input tax payable, TDS payable, other tax accounts. For GR/IR clearing account right profit center is picking without any mistake, while doing MIGO & MIRO.
We need to extract the Balance Sheet profit center wise at plant level.
Derivation rule is created for this balance sheet account along with Valuation area condition to post to correct profit center maintained under Tcode: 3KEI . But system is taking only default profit center (3KEH).
I have checked configuration and the following areas like Material master costing view, tax code areas, and account group but did not find any mistake.
Please advice and Guide us, how to get correct profit center at plant level for these balance sheet accounts instead of default. (I want to make default profit centers plant wise).
It is urgent.
Thanks,
Shailendra Gupta.

Hi!
You can use following report :
S_ALR_87013336 (Report for Balance sheet at Profit Center and Group Level).
Hope this will help.
Thanks & Regards,
Taral Patel

Is it possible multiple line items debit & single line item credit and different cost centers and different profit centers in fbcj

Hi all ,
I have a requirement to Post Cash Journal Document using FBCJ tcode.
Is it possible multiple line items debit & single line item credit and different cost centers and different profit centers
for exp:
pk   GL a/c   description       amount   cost center profit center
40 400101 telephone exp   500        1403            P 1000
40 400101 telephone exp    100       1404            P 2000
50 200100 cash in hand      600-
   This is My requirement is it possible in fbcj
    Please suggest me.ASAP.
Regards
   Naresh.

Hi,
This you can do it in two ways:
1. Make three header under top level....one Product A, 2nd Product B ( as Billing element) and third as Common expense ( only cost). Now 1st & 2 nd WBS, you have to have sales order linking with individual lint item, for third you will accumulate all the common expense till the period end then make a reposting of the same in desired proportion to both products WBS hierarchy
(This is if you want to have a track on the common expense as well.......like planning, budgeting & control)
After this reposting, run RA for individual billing element and hence you will all the complement detailing and control over Revenue and expense with respect to Product A and Product B individually.
2. If you don't want to maintain that kind of detailing the common expense and keep track of it through project, then have cost centers accordingly and make an assesment/ distribution with respect to expenses accumulated at those cost centers for the period to the respective WBS under each product. Then execute the period end processes for the project.
Or
You can try with have two more line items in the costing sheet as an overhead against common expenses with respect each product.
I hope this should help you.
Regards
Avisek Bhardwaj

KE28 - problem with Profit Centers

Hi Gurus,
I have segments with several profit centers.
On one profit center I have costs. On the remaining I have revenues.
I want to distribute costs from the first profit center to the others by revenues they have.
Is it possible?
THX
G

Hi G
In your case, Dist Lvl will be PC.
In selection criteria, if you enter the Source PC and choose Sales revenue as Tracing factor, will that not work??
Usually, Top Down works when you wanna allocate from a higher level to lower level. In your case, the level is same I.e. Sender and Receiver both are PCs
If the above suggestion does not work, then you need to identify one more characteristic along with source or target PCs. Say, Dist channel. In this case, choose PC as Dist Lvl and Dist channel in the selection criteria
Br. Ajay M

Foreign currency revaluation and Profit Centers

Hi all,
We want to use F.05 to post exchange rate differences but are working with a system that uses also Business areas and a multitude of Profit Centres (in one company code).
We have One company code
> n business area for this one company code, and
> n profit centre per business area
SAPs standard solution for this issue is use transaction 3keh/ 3kei and send it to a specific profit centre (one per company code).
This does not help us. We would need to have the differences to be distributed at least on Business area level or at least on profit centre level.
Who can help? Any suggestion mostly welcomed! What would need to do to achieve this?
Thanks!
Hein

Hi
If you want to assign the differences to Business areas also other than profit centers.
You can force the assignment of the GL account to Business area, profit center, cost center with transaction OKB9. Or try out validations and substitutions.
Try it out it might be helpful.
Regards,
Suraj

Pulling Profit Centers from AR

Hi,
We are currently using 0FI_AR_4 extractor to pull AR related information. One of our requirements requires us to analyze by Profit Centers. From what I understand profit centers are derived at material level hence the current extractors is not able to pick up this information if there are more than 1 material. How do I go about pulling this information ? I believe data needs to be pulled from table BSAS / BSIS ? Should i use 0FI_GL_4 instead ?

You are right, 0FI_AR_4 and 0FI_AP_4 pulls from BSID/BSAD and BSIK/BSAK but I am also not able to find any standard extractor for BSIS and BSAS.
One way around for this is to create your own extractor.
For profit center accounting you have standard extractor, chk EC-PCA in RSA5.

Profit Centers Query

Hi,
Can anyone tell me how do we assign profit centers and at what levels and where?
Please let me know about the same.
Thanks and Regards,
Kanthi.

Hello Kreddy,
The 1st step is to define it in the cost accounting form --> profit center in the financial module.
It is assigned in the marketing document --> row level, inventory transaction --> row level and UDF (using FMS).
It is clear that the use of profit center (based on F1 help file):
When you create a marketing document that involves revenue and cost of goods sold accounts (such as a delivery, A/R invoice, return, A/R invoice + payment, and A/R credit memo), the transactions are posted to the defaulted revenue and cost of good sold accounts and allocated to the profit centers that were linked to these accounts via the Chart of Accounts.
The following procedure explains how to link different profit centers to the revenue and cost of goods sold accounts in the document and/or row level.
The summary of the above definition is profit center can make your company more selective in the revenue, COGS and budget setup in the business operations.
Rgds,

Preparing Balance sheet by using profit centers only for BS Items

Dear Experts,
could you please help me out regarding the following issue.
business area wise we can get the balance sheet but i want to know is there any possibility to get the BS by using profit centers only for BS Items or can we assign biasness area as well as profit center in a single screen.

Hi!
You can use following report :
S_ALR_87013336 (Report for Balance sheet at Profit Center and Group Level).
Hope this will help.
Thanks & Regards,
Taral Patel

Profit Centers & Distribution Rules

hi experts,
I have created a distribution rule which consists of 5 profit centers as following:
Sales1 20%
Sales2 20%
Sales3 20%
Sales4 20%
Sales5 20%
I posted a JE with amount of 2000 to one of my expense accounts with distribution rule tagged in row level.
Run:
P&L statement with profit center Sales1 is selected (expected result: expense account 400)
Result:
Empty~NOTHING. (I believe 400 should be showing in my P&L right?)
Please advice me on above statement.

Hi Lim,
you need to define the distribution rule (remember if it is direct charge or indirect charge), than You can post a document or a JE with a G/L account of expenses or profit and you need to specify the Dsitribution Rule code into the JE row with the G/L Account.
When you run the Profit Center Report and you can see the amount's distributed by Profit Center based on the rule you have defined.
With the Profit & Loss Statement, you can't run it with the Profit Center into Expanded Selection Criteria but you can run only with the Distribution Rule (in fact into the JE you have inserted the rule non the profit center !! ).
This is a limitation and a system definiton of Cost Accounting into Business One.
Regards,
Massimo Sala - Italy LPE

KE51 - Maximum Number of Profit Centers

Is there a real or practical limit to the number of profit centers we can create for PCA? Our standard hierarchy (KCH3) has over 2100 items today and we are likely to double that over the next 2-3 years. I do not expect to run into problems at this level but I did not have an answer to the question, what is the limit?

There is no specific limitation - however you would be well advised to keep the count down to manageable limits.
E.g if you have 10000 profit centers, it becomes extremely hard to keep maintaining hierarchy, groups and the myriad details associated with all the PCs. Also I have noticed a degradation of performance with over 5000 profit centers.
Also if you use a portal for your work, remember that your users will hate the limited real estate available to view the hierarchy or to run down thru the list of drop down PCs available.
I would use a combination of various data elements available in the system to achieve reporting needs - keep PCs as low as possible.

Summary for all Profit Centers in the Profit Center Report

There should be a summary for all Profit Centers in Profit Center Report. Now there is only summary by Sort Code but should be also summary for all Sort Codes.

Alex is right if we are dealing with R/3 and thats not the way you look in BW.
normally org. levels are not used in BW. unless you created one using ORG_LEVEL_CREATE( normally nobody does that in BW or may be I never heard of it).and that is the reason we create RSR objects. so if you look in AGR_1252
with VARBL $PRCTR you won't get anything.
$PRCTR might be your custom field I guess. Identify the RSR auth. objects which has this field. you already mentioned you did that and you have 6 auth. objects.
you might have made 0PROFIT_CTR as auth. relevant and created those 6 RSR auth.objects.
To get the list of roles where those RSR objects getting used and the profitcenter values in those roles, I would say goto AGR_1251, and in OBJECT field give your 6 RSR objects in the multiple selection tab which you can see on the right side of that field. you will get the list.
regards
Message was edited by:
        Keerti Vemulapalli
Message was edited by:
        Keerti Vemulapalli
Message was edited by:
        Keerti Vemulapalli

Find Profit centers based on profit center group

1) If I know profit center group how to pick profit centers which belongs to that profit center group.the tcode is (KCH3)
2) In the tree there may be many levels I mean for the profit center also contain other profit centers, just to display in the same way as like in KCH3 tcode, how we are going to maintain in alv trees

Hello,
Check the tables:
<b>SETLEAF
SETNODE
go through this link which ll give you clear idea about the profit center group.
http://help.sap.com/bestpractices/industry/serviceindustries/v346c_us/BBLibrary/documentation/B30_BPP_04_E.doc
go through these tables.
CEPC Profit Center Master Data Table
CEPCT Texts for Profit Center Master Data
</b>
REgards,
Vasanth

All the profit centers in a plant

hi
can any one tell me how to see the all the existing Profit centers in a plant
either through a table or through a transaction

Hi Reddy,
a report based on table BSEG will to 100% sure NOT solve your issue as in table BSEG only the transactional data posted to FI is stored. If the plant information is available depends on the application (does the application transfers the plant information?) but also depends on your customizing (is the field status activiated for plant? etc)
You can check with the PCA assignment monitor which profit center is assigned to a material as the profit center assignment is made on material/plant level. (Example: You have material a in plant x and in plant y, then you can assign a profit center to material a in plant x AND you can assign a different profit center to material a in plant y).
A possibility will be an ABAP report on table MARC which is a master data table for materials. In this table you have the plant information and you have the profit center information available. Based on this table you can write an own ABAP to determine which profit centers are assigned to a plant or vice versa.
Cheers,
Daniela

Budget Setup By Profit Centers

Budget Setup By Profit Centers
Actual Situation
Our Customer working with Budget by Profit Centers Level. In this moment the Budget only can define a Level Account
Partial Solution
Theirs can't create Budget Scenarios by Profits Center, but this is not functional when the customer have many profit center.
Ideal Solution
Can define the Budget, by Profit Center how first Level and Account how second Level.
Regards
Miguel Angel Herrera

Please check this thread:
Budjets-- Project Wise
Thanks,
Gordon

Level of profit centers

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