SAP cost center hierarchy —excerpt from First Steps in SAP Controlling (CO)

Cost center hierarchy
Cost center hierarchy consists of groups of cost centers in a tree structure within a controlling area.
Cost centers can be grouped together to provide summary cost information. A cost center hierarchy consists of nodes and sub-nodes that cost centers are attached to.
A cost center hierarchy comprises all cost centers for a given period and therefore, represents the entire enterprise. This hierarchy is known as the standard hierarchy.
Cost center hierarchies are typically defined before creating cost centers. Maintenance is handled via transaction OKENN (see Figure 4.1).
The menu path is as follows: ACCOUNTING • CONTROLLING • COST CENTER ACCOUNTING • MASTER DATA • STANDARD HIERARCHY • CHANGE (OKEON) / DISPLAY (OKENN).

Keep reading in First Steps in SAP Controlling (CO) by Ashish Sampat.

This book offers a comprehensive introduction to SAP ERP Controlling (CO). You will learn the basic fundamentals of the organizational structure, master data, and functions of SAP Controlling, including overhead controlling, product costing, month-end closing, and reporting. If you would like to understand the basic fundamentals of SAP Controlling, with examples based on a case study approach, this book is for you! Using a fictional chocolate manufacturing company case study, you will learn fundamentals based on several day-in-the-life scenarios of various key functions such as cost planning, production controlling, actual costing, and information systems.

Get detailed information on how SAP CO integrates with other SAP modules and obtain insight into the different functional areas typically used in manufacturing organizations. Dive into SAP ERP master data elements and get tips on how to maintain consistent and accurate data. Review the various planning methods available and get an overview of cost center planning, including overhead planning and labor cost planning. Understand how SAP Material Ledger can be used to accurately determine costs. Identify how actual costs are booked and absorbed.
By using a detailed case study, practical examples, tips, and screenshots the author brings readers new to SAP CO quickly up to speed on the fundamentals.
Author Ashish Sampat has been an SAP consultant for most of his career with various consulting organizations and now works as an independent SAP FI/CO consultant. He has provided solutions in several areas of SAP Controlling including product costing, material ledger, and cost center accounting to global clients in consumer packaged goods, life sciences, and industrial sectors.