Operating Concern

Definition
Operating concern represents a part of an organization for which the sales market is structured in a uniform manner. It is an organization unit in accounting which structures an enterprise from the Profitability Analysis point of view.

Structure
An operating concern is divided logically into two parts viz. Characteristics and Value Fields. 

Before we go ahead on Operating Concern, I would brief you about the two parts involved:

Characteristics
In this, the Characteristics store the various dimensions of a transaction like Customer Code, Sales Organisation, Distribution Channel, Profit Centre. In other words, we can say that the characteristics store various master data involved and numbers like Sales Order, involved in the transaction. The characteristics in the end act as a criteria to analyse reports.

Value Fields
As suggested by the name itself, the value fields store values involved in the transaction. It contains for e.g. the Basic Price, discounts, quantities etc. for sales invoice and in case of production order it contains the value of production variance.


Implementation Consideration

Defining Operating Concern
IMG Path:  Enterprise Structure > Definition > Controlling > Create Operating Concern

Here we create a new operating concern and enter the description for the same.



Assignment
The operating concern is not linked directly to any company code. It links itself to a company code through Controlling area. In other words we may say that the Operating concern and Company codes are linked to Controlling area and Controlling Area acts as an organisational unit which links both operating concern and company code.

IMG Path:  Enterprise Structure > Assignment > Controlling > Assign controlling area to operating concern

Under this step we enter the corresponding controlling area for the operating concern


 
Configurations
Once we have assigned the Operating concern to controlling area, we should move ahead into operating concern configuration:
IMG Path:  Controlling > Profitability Analysis > Structures > Define Operating Concern > Maintain Operating Concern

In this activity we define and maintain the operating concern we are going to use.

The configuration involves following:

Data structure
The data structure determines the structure of the profitability segments that you can analyze and how costs and revenues are organized. All information in the data structure definition is valid for all clients. If you use the operating concern in more than one client, you still only need to define the data structure once. You then need to set the attributes in each client individually. In data structure we can maintain Value Fields and Characteristics.


Costing Based CO-PA or Account Based CO-PA
Here we can select if this is Costing Based CO-PA or Account Based CO-PA.


Attributes
Under attributes we maintain the Operating Area currency. Here we can maintain the currency that we want CO-PA reporting in. With the operating area currency we also have an option to activate company code currency as well.

Note: Whereas actual data can be updated simultaneously in all the combinations of currency type and valuation that are described below, planning data is always updated in one currency only - the currency specified for that particular plan version. Note also that updating actual data in multiple combinations of
currency and valuation significantly increases your data volume with each additional combination.


Posting Period Variant
Here we assign the posting period variant to the operating concern. 

Allocation control requires the same number of posting periods in the company code and in the assigned controlling area. This means that the number of posting periods in the fiscal year variants must be the same in the company code and in the controlling area. The period limits for the two fiscal year variants must also coincide.



2nd period type - weeks

Update actual data in the second period type
Update plan data in the second period type
If you set this indicator, the system will store the actual or plan data in costing-based Profitability Analysis in weeks as well. This increases the data volume in Profitability Analysis significantly, which could lead to significantly slower response times in the information system.

There is no alternative period type available in account-based Profitability Analysis.


Environment

Status of the Cross-Client Part of the Environment
The status indicates whether the cross-client part of the operating concern environment (that is, the programs, screens, and other objects generated for an operating concern) can be used.

"Green light": The environment is active. No further actions are required for the cross-client part of the environment.

"Amber light": Either a system upgrade has occurred or corrections (support packages) have been imported into the system. Before you can work with the operating concern, any changes need to be copied to the operating concern environment. No further actions are necessary because the system transfers any changes automatically during the first transaction that accesses the operating concern. The automatic transfer takes a few minutes. To avoid delays in a productive system, SAP recommends that you activate the transfer manually using the Customizing activity Maintain Operating Concern.

"Red light": The environment is not active. This situation arises either after the data structures have been activated or if errors occurred during activation. If the latter applies, analyze the action log and try to remove the cause of the error. Use the Customizing activity Maintain Operating Concern to activate the environment.

"Extinguished lights": No environment has been activated for the operating concern. You need to use the Customizing activity Maintain Operating Concern to activate the environment.


This way we can configure the Operating Concern and embark our journey onto the amazing world of CO-PA.