Define Company and Company Code

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Define Company and Company Code

In SAP, Company and Company Code are key organizational units within the system, used for financial reporting and accounting purposes:

Company:

• A Company is the highest-level organizational unit in the financial accounting structure of SAP.
• It represents a group of company codes that share a common consolidation structure
• A company is used mainly for external reporting (e.g., consolidated financial statements for legal purposes).
• It serves as a group entity but does not manage day-to-day operations or transactions.
• Example: A holding company that consolidates multiple subsidiaries (e.g., Company A with subsidiaries A1, A2, A3).

Key Features

• Company encompass multiple Company Code
• Acts as a consolidation level in Group Reporting

Company Code:

• A Company Code is the smallest organizational unit for which a complete set of accounts can be prepared.
• It is a legal entity in the system that represents a company or a subsidiary within a group.
• All financial transactions are recorded in the Company Code.
• Mandatory to define at least one Company Code in SAP for posting financial transactions.
• Example: Subsidiary A1 of Company A.

Key Features

• Company used for Statutory reporting (e.g. Profit & Loss Statement, balance sheet).
• Represents operation-level entities, such as subsidiaries or branches.

Relationship:

• One company can have multiple Company Codes.
• A Company Code cannot exist independently of a company in consolidation reporting.

Diagram Representation:

                                                                                 Company (Parent Entity)

                                                                                                               |

  -------------------------------------------

  |                           |                 |

CCode1                CCode2     CCode3

Enterprise Structure in SAP

1. Define Company (Group Company): In SAP, a Company is the highest-level organizational unit in financial accounting used for consolidation purposes.

We can create a company code with two methods:

Step-1

• T Code: OX15

Or we can go through Path

Path: > SPRO>IMG SCREEN>ENTERPRISE STRUCTURE>DEFINING > FINANCIAL ACCOUNTING > DEFINE COMPANY

Step-2 : Click on Reference IMFG or press F5

Step 3) : click on Define Company

.

Step 4): Fill your company Details (like Company Code, company Name, Address, language, currency)

The your request will generate configure as per your requirement by clicking on (Own Request).

And then save. Now our company has been created.

Create Company Code

Creating a Company Code in SAP S/4HANA involves configuring an organizational unit for legal and financial accounting purposes. Below are the steps to create a Company Code in SAP S/4HANA for FICO:

T Code : OX02 (for create Company Code)

Path: >SPRO > IMG > ENTERPRISE STRUCTURE > DEFINING > FINANCIAL ACCOUNTING  > EDIT, COPY , CHECK COMPANY CODE

As per navigation click on Edit,Copy,Delete, Check Company Code

Click on Edit Company Code Data

Then click on Create New Entries then fill the Details of the Company Code

And then save. Now our company code has been created.

Assign Company code to Company

To assign a Company Code to a Company in SAP, you need to link these organizational units to enable proper consolidation and reporting. Below are the steps to perform this assignment in SAP S/4HANA:

Steps to Assign a Company Code to a Company 1. Access the Configuration Screen

• Enter SPRO in the command field and press Enter.
• Navigate to:
  SAP Reference IMG → Enterprise Structure → Assignment → Financial Accounting → Assign Company Code to Company.

Then click on Save. Now your assignment to Company is completed