Overhead Cost Accounting (J54)

Overhead Cost Accounting (J54)

This scope item covers transaction-based actual postings that are used in overhead cost controlling. The purpose of overhead cost controlling is the planning, allocation, control, and monitoring of overhead costs.

Cost center accounting takes the costs incurred in a company and allocates them to the actual subareas that caused them. During period-end closing, these costs are distributed to cost centers through automatic allocation. By allocating the cost elements to cost centers in overhead cost controlling, you can control your costs and compare plan and actual costs. The plan/actual comparison at the end of the period helps you to plan, control, and monitor cost behavior. Overhead cost controlling is also a prerequisite for further allocating overhead costs to cost objects (CO-PC), which enables you to conduct a period-specific profitability analysis.

Key Process Steps Covered

  • Record primary costs to cost centers by posting journal entries with reference to a cost center
  • Update cost center with the correct values
  • Post statistical key figures (for use in reporting or as tracing factors for period-based allocations)
  • Distribute primary and secondary costs using an assessment cost element
  • Run the cost centers actual data reporting
  • Reassign costs and revenues
  • Analyze allocation flow
  • Maintain and monitor your cost center budget (optional)
  • Transfer cost center budget

Benefits

  • Get a transparent view for an account of a cost center
  • Process a journal entry for various purposes
  • Determine availability of steps required for preparing periodic and year end activities
  • Determine necessary steps for preparation of periodic and year end activities
  • Track commitments posted on cost centers
  • Experience no undesired budget over runs and full transparency of the consumed and available budget at any time

Where is Overhead Cost Accounting(J54) being used?

This Scope item is used in the following way:

  • As a management function of Cost Management and Profitability Analysis within Finance Scope Item Group

Process flow of Overhead Cost Accounting (J54)

Find below the process flow of the scope item Overhead Cost Accounting as it is defined for release s4hc-2111.


Download Process Flow of Best Practice scenario Overhead Cost Accounting (J54) - S/4HANA Cloud
Ref: Finance of SAP S4HC-2111
Best Practices related to S/4HANA*1) Yearly Updates are released per September of each year
*2) The Quarterly updates are released per Februari, May, August and November
Details of future releases can be found in the SAP Roadmap section of each product. Go to SAP Roadmap Product Finder.
Knowledge Center Scheer Nederland | The Process Experts Visit also the SAP Cloud ERP knowledge center of Scheer Netherlands. The following topics are covered:
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