Important Units of Organizational Structure
- Client:
In the SAP S/4HANA application, a client is a unit which is self-contained in legal, organizational, and data terms. A client has separate master records and an independent set of tables. From a business perspective, for example, the client represents a corporate group.
The client is the highest hierarchical level in the SAP S/4HANA application. Specifications you make, or data you enter at this level, applies to all company codes and other organizational units. Therefore, at client level, you do not have to enter the specifications and data in the system more than once. This ensures that the data remains consistent.
Access authorization is assigned on a client-specific basis. A user master record must be created for every user in the client in which the user wishes to work. If the Client field has not been prepopulated, each user must specify a client key when logging on to a SAP S/4HANA client. The client key is a three-digit number which is uniquely defined in the system. All user input is stored and separated by the client.
Data is also processed and evaluated on a client-specific basis.
- Company code:
A company code is the smallest organizational unit of external accounting for which a complete, self-contained bookkeeping system can be replicated. This includes the entry of all events which must be posted to the accounts and the creation of a complete audit trail for balance sheets and profit-and-loss statements.
A company code represents an independent unit which produces its own balance sheet, for example, a company within a corporate group (client).
You can set up several company codes in one client to keep separate sets of financial books. To copy a company code, use the special Customizing function. In the process of copying a company code, the specifications (which depend on the company code) are adopted for your new company code.
A company code is defined in the system using a four-character alphanumeric key that is unique to the client.
- Plant:
A plant is an organizational unit within logistics which subdivides an enterprise from the perspective of production, procurement, and materials planning.
- Storage location:
A storage location is an organizational unit which helps differentiate stocks of materials within a plant. Inventory management (on a quantity basis) is carried out in the plant at storage location level. Physical inventory management is also carried out at this level. A storage location is defined by means of a four-character alphanumeric key which is unique in the plant. Organizational units are closely linked to each other so that the relevant data for a business area can be processed quickly.
Organizational Unit Assignments
The Organizational unit assignments are:
- Plant 1010 is assigned to company code 1010.
- Company code 1010 is assigned to controlling area A000.
Whenever a transaction involving costs occurs in plant 1010, the relevant records in controlling area A000 are updated automatically. The valuation area is the organizational level at which material quantities and values are managed. It is essential for product costing that a valuation area exists for each plant.
Within each valuation level, you can differentiate between values and quantities for valuation (in-house production and external procurement) by using different valuation types. In Customizing for Materials Management (define valuation type), balance sheet valuation is set up at company code or valuation area level.
Selecting valuation area level automatically creates a valuation area for each plant. To use product costing and order costing, inventory valuation must be carried out at plant level.
