CO Distribution Cycle Using Actual SKF

Allocation cycle is needed when there is a need for assessment or distribution of expenses from the
sender to the receiver objects on some pre-determined criteria.

Again the usage of either going for assessment or distribution cycle is entirely based on requirement.

Since assessment cycle requires a secondary cost element for allocation of expenses and composition of
original cost elements are not retained whereas there is no requirement of using any assessment cost
element thereby the composition of original cost elements are retained.

Business Scenario

Now we will see a scenario wherein utility expenses has been charged to Administration cost center but
there few more cost centers who have actually incurred the expense. Hence the expense would be
distributed to each of the cost centers based on a tracing factor.

Tracing factor can be anything that serves as a basis for allocating the utility expenses like SQFT, Labor
hours, No. of employees and the like. These are known as statistical key figures (SKF).

Design of Distribution Cycle

Tcode- KSV1

We need to update the controlling area, short name for the distribution cycle, start & end date and text
for the cycle

Then click on the First Segment tab for defining the sender, receiver cost and allocation rules for the
distribution cycle.
We maintain the name of the segment and in the first tab, we have selected the sender rule as posted
amount.

Since we are using SKF as the tracing factor, the same has been selected in the “Receiver tracing factor”

In the second tab, the sender cost center and the sender cost element group has been maintained.

For receiver, the receiver cost center group has been maintained.
Here we select the actual value origin with 100 % share for expenses to be allocated to the receivers
from the sender
Actual SKF and the tracing factor SQFT has been updated in this tab
Here we have taken 2 decimal places as the weighing factor for the periodic allocation.
Design of Statistical Key Figure (SKF)

Tcode-KK01

SQFT serves as a basis of allocation (tracing factor) in this scenario and below details has been updated
in the SKF master data.
Pre-requisites for execution of distribution cycle

Tcode-FBL3N

Expense posted against the Sender Cost center which is mapped in the UTOH Distribution Cycle

Each of the receiver is posted with the square foot area which will serve as an allocation base while
running the distribution cycle
Tcode-KB31N

Execution of Distribution Cycle

Tcode KSV5

Input the parameters required for execution of distribution cylcle with the below details and then
execute the same.
Costs Credited/Debited to Sender & Receivers respectively

We can see the Costs have been allocated based on the tracing factor and the original costs can be
traced in the sender as well as receiver cost centers

Actual Cost Line items for Cost Center Report

Tcode KSB1

We can see the receivers has been credited and the sender has been debited with same amount