Cross-Company Code Cost Allocation and Cost Center Transfer in SAP S/4HANA Cloud Public Edition - Sc

[byd]

Hi SAP Community,

We are implementing SAP S/4HANA Cloud Public Edition and have questions regarding cross-company code transactions within the same client.

Questions:

1. Cost Allocation Between Company Codes:
- Is it possible to perform cost allocation (assessment/distribution) between different company codes within the same client?
- If yes, which scope item(s) should be activated?
- Which Fiori app(s) should be used?

2. Cost Center Transfer Between Company Codes:
- Is it possible to transfer costs between cost centers in different company codes within the same client?
- If yes, which scope item(s) should be activated?
- Which Fiori app(s) should be used?

What I've found so far:
Based on the blog "Deep Dive: Cross Company topics in Controlling" by Dick Westman, it appears that:
- Universal Allocation (2QL) can be used for cross-company allocations
- Cost Center → Cost Center and Cost Center → WBS allocations are possible
- The "Manage Allocation Cycles" app seems to be the main tool

However, I would appreciate confirmation from anyone with implementation experience:
- Are these the correct scope items for Public Edition?
- Are there any limitations or prerequisites we should be aware?
- Any best practices for setting up cross-company cost allocations?

Thank you in advance for your insights!

[HenrikeGrtecke]

Hello, thank you for your question. It has been forwarded to the experts. Kind regards, Henrike

[ESWAR_NEKKALAPU9]

Yes, cross-company allocations are supported in SAP S/4HANA Cloud Public Edition, but only through the Universal Allocation framework.

1. Cost Allocation Between Company Codes

You can perform cost assessments and distributions across company codes as long as both company codes belong to the same Controlling Area. The key scope item to activate is 2QL – Universal Allocation.

Use the Manage Allocation Cycles – Actual and Run Allocations Fiori apps to set up and execute the cycles. In your cycle, you can select cost centers from different company codes as senders and receivers.

2. Cost Center Transfer Between Company Codes

Yes, cost transfers between cost centers in different company codes are possible in the same controlling area using the same scope item (2QL). The same Fiori apps are used here as well.

Notes and Best Practices

• Make sure all involved company codes share the same Controlling Area and Currency setup.

• Intercompany postings will automatically generate the proper accounting entries in both company codes.

• Test the allocation setup carefully because the integration with Financial Accounting is strict in Public Edition.

So in short, you are on the right track. Use scope item 2QL, and the Manage Allocation Cycles app is indeed the correct tool.

[Thorsten_Seegers]

Dear byd,

Thank you for your questions which I will try to answer below and also provide some general feedback / considerations:

Cost allocations in SAP Cloud ERP (S/4HANA Public Cloud) are by default enabled between different company codes (within one system and Controlling Area). The supported Apps are mentioned in sap help which also refers to required configurations (e.g.  Define Intercompany Clearing Accounts, Define Intercompany Margin Accounts, ...).

As all such postings are Management Accounting related (and thus e.g. posted w/o tax) the compliant reflection of such exchanged services under tax transfer pricing and local stat accounting requirements need to be considered. 
SAP offers the solution Intercompany Billing of Cross Company Cost Allocations (Scope Item 4AN).
Please check this blog which provides a very good overview: https://community.sap.com/t5/enterprise-resource-planning-blog-posts-by-sap/intercompany-cost-alloca... 

Regarding the questions

1. Cost Allocation Between Company Codes:
- Is it possible to perform cost allocation (assessment/distribution) between different company codes within the same client?
yes
- If yes, which scope item(s) should be activated?
universal allocation (2QL), for compliant reflection please check whether 4AN might be an option to legally reflect the transactions / services exchanged. 
- Which Fiori app(s) should be used?
depends on what is appropriate - refer to list of supported Apps

2. Cost Center Transfer Between Company Codes:
- Is it possible to transfer costs between cost centers in different company codes within the same client?
yes
- If yes, which scope item(s) should be activated?
see above 
- Which Fiori app(s) should be used?
see above 

Kind regards

Thorsten