Business area

[Former Member]

Hi friends

Can u plz tel me what is a business area

Is it same to sales area or not?

How business area is determined

Thank you

[Former Member]

Done

Thank you

[Former Member]

Hi Manoj.

Bussiness area is an organisational unit in Financial accounting, Defined for posting of transaction into the financial accounting and is used for internal reporting purpose.

Business area can be determined either by three way i.e,

With the combination of Sales area or Plant & item division.

Regards.

[Former Member]

Thank you all

solved

[Former Member]

Hi Manoj

Business Area is an organisational unit but defining this organisational unit is optional.

One company code can have one more business area and the same Business Area can be shared by many Company codes also.

That is why, Business Area is not limited by Company code, means not specific to any particular Company code.

Its description also never changes as per Company code.

Cross Company code internal reporting is posssible through Business Area.

Profit and lose statement & Balance sheet can be done through Business Area, but it is only for internal purpose and can not be for external reporting .

That means P/L & Balance sheet created by Business area can not be presented to govt. body, (that is created from company code level).

G/L account can be posted by Business Area .

Business Area has no fixed assignment in customising.

It can be determined for each item in the Sales order based on some rule.

Therefore , in a Sales order different Business Area can determined for different items.

There are 3 rules for determining Business Area.

You have to specify the rule you want to use for each of your Sales Area.

These rule can not be extended.

Those 3 rule are,

1. Business area determination by SALES AREA

2. Business Area determination by PLANT + ITEM DIVISION

3. Business Area determination by SALES ORG + DIST CH. + ITEM DIVISION.

[Former Member]

Hello,

Business Areas in SAP are used to differentiate transactions originating from different points/lines/locations in business. Let me give some examples to elucidiate:-

ABC is a company which have a variety of businesses under it. Let us say that it typically operates in 3 different domains like machinery manufacturing, trading and assembling of machine parts.

There are 2 options here now -

1. Either create different company codes for the 3 business operations (which would be the easiest and require no creativity)

or

2.) Create each of these business lines into business areas (the better option).

The advantages of using the second option (Business Area) is:

1. You can use these business areas if other company codes require the same areas

2. The configuration is simpler as in case of company code, you would require to go through the entire configuration of creating Chart of Accounts, Fiscal Year variants, posting periods variants and so on. In the business area option, you just need to attach it to the company code and the rest of the details in Business area is attached by default from the company code you are using it in.

3. Using the options in controlling (EC-PCA, Enterprise Controlling, Profit Centre Accounting), you can even draw up Balance Sheets and PL statements for your business areas and hence this is used for management accounting in some companies (like HP, Dell, etc) when it wants to know the operating profits for different business areas/lines.

Business area can be determinaed by the rule we maintain.. there are three rules..

1.Business area determination by sales area

2.Business area determination by plant and item division

3.Business area determination by sales org, distribution channel and item division

Prase

[former_member550050]

Hi

Business area is completely different to sales area

Business area represents an organizational unit for which you can carry out internal reporting

A company code can be divided into several Business areas

A Business area may also be shared by several company codes

For this reason a business area must have the same description in all company codes

Defining Business area is optional

They can be used to prepare balance sheets and P/L statements not only for company codes but also for other internal areas with in a client like division related reports

The relevent Business area is defined for each order item according to defined rules

The rules are

1.Business area determination by sales area

2.Business area determination by plant and item division

3.Business area determination by sales org, distribution channel and item division

Regards

Raja

[Former Member]

Business Area means:

An organizational unit of financial accounting that represents a separate area of operations or responsibilities within an organization and to which value changes recorded in Financial Accounting can be allocated.

You can create financial statements for business areas, and you can use these statements for various internal reporting purposes.

u can define Business area in SPRO-Enterprise Structure-Financial Accounting.

Here u can define Business area

Based on Business area it is easy for company to do accounting purpose based on plant and divison.

Regards

Srinivas.