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Secondary Cost Elements as GL Accounts in SAP S/4HANA


Secondary cost elements are used for cost allocations between cost objects in SAP Controlling. Prior to S/4HANA, these postings had no impact on the general ledger unless special substitution rules were used allowing for a reconciliation account to be assigned to secondary cost elements. In S/4HANA, secondary cost elements are now treated as regular P&L accounts, and the account substitution is no longer allowed. When making a conversion from ECC to S/4HANA, the implications of this change must be thought through to ensure a smooth transition.

Learning points:

  • Primary and secondary cost elements in S/4HANA
  • Impact on the chart of accounts
  • How to document splitting is impacted
Tom King

Tom King recently retired from Milliken and Company, a leading manufacturer of specialty textiles, floor covering, and chemicals based in Spartanburg, South Carolina with global manufacturing facilities, where he was a Senior Business Analyst. He has more than 30 years of experience at Milliken in manufacturing and product costing. Tom was lead CO analyst involved with the SAP implementation worldwide. He has written three SAP books: Practical Guide to SAP CO Templates, SAP S/4HANA Product Cost Planning Configuration and Master Data, and SAP S/4HANA Product Cost Planning Costing with Quantity Structure 

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