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Direct and Indirect activity allocation

Former Member
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Hello gurus,

can any one please explain the difference between the Direct activity allocation and Indirect activity allocation with examples



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Answers (1)

Active Contributor
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Hi Rihana

Direct Act allocation is what you do in KB21N (To issue activity from one cost center to another object) or activity confirmations through Prod order or Service Order

Indirect Act Alloc (IAA) - You have power as a cost center.. You collect all costs for power in this cost center....

But Power as act type is not specified on this cost center, but on mfg cost center 1, Mfg CC 2, 3, 4, 5, etc...

So in this case, cost is collected on one CC and Act Qty is colected on another CC.... Now, if you want to transfer costs from power cost center to all mfg CC based on power (Act Qty) confirmed in those cost cengters, you will use IAA...

IAA will tell the system that Qty confirmed in all MFG CC = Qty of POWER CC... i.e. Qty sent by the sender = Qty received by the receiver

The result of IAA cycle would be that sum total of Act Qty confirmed on Mfg CC will be transferred to Power CC.. Act rate will be calculated on Power CC in KSII and accordingly costs will be transferred to Mfg CC in same proportion

If your issue is addressed, plz close the thread.. Do let me know if you have further questions


Ajay M