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when should an income statement GL account NOT have a matching cost element?

mwfrizzell
Explorer
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214

My company is using ERP 6.0.  Related to GL accounts for the income statement (aka profit and loss statement), almost all GL accounts have a matching cost element.

My question is what is the normal and expected use case for a P&L GL account to not have a cost element? 

adding more context, I am referring to primary cost elements, with one of 3 cost element categories
1 = primary costs/cost-reducing revenues

11 = Revenues

12 = Sales deduction

mwfrizzell
Explorer
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adding more context, I am referring to primary cost elements, with one of 3 cost element categories
1 = primary costs/cost-reducing revenues

11 = Revenues

12 = Sales deduction

 

mwfrizzell
Explorer
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adding more context, I am referring to primary cost elements, with one of 3 cost element categories
mwfrizzell
Explorer
0 Kudos
adding more context, I am referring to primary cost elements, with one of 3 cost element categories

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Answers (1)

Answers (1)

sumesh_gupta
Active Participant

Hello @mwfrizzell in general all p/l GL's are created as cost element but expenses/revenue of non-operating (not related to core business of company) nature can be excluded as cost element like sale of asset, some interest on FD (In S4 while creating GL there is option of non -operating type as well if select this no need to create that GL as cost element).

Apart from that WIP P/L GL, COGS (in costing based COPA) are also not created as cost elements. Please refer below thread apart from WIP P/L GL others are optional can or cannot be created as cost element.

https://community.sap.com/t5/enterprise-resource-planning-q-a/when-not-to-create-cost-elements-for-p...

Regards,

Sumesh Gupta 

mwfrizzell
Explorer
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Thank you sumesh_gupta. The information in the other thread is helpful. Though it does not answer my question completely, it provides good guidance and examples when a P&L GL account does not require a cost element. I wanted to review this approach or strategy of GL accounts and cost elements as we look forward to an S4 migration, providing the opportunity to re-create our chart of accounts