Checking Controlling Specific Settings of G/L Accounts


After completing this lesson, you will be able to:

  • Identify cost accounts
  • Differentiate between primary and secondary costs

Cost General Ledger Accounts

In accounting with SAP S/4HANA, the data from financial and management accounting is processed in a uniform data environment. This applies to both transaction data such as invoices and accounting master data such as G/L accounts.

While financial accounting tracks inventory values, expenses, and income, only operating costs and revenues are relevant for Management Accounting.


Not all expenses or income are relevant for management accounting. For example, gains from currency valuation differences are not operating gains and will not be posted with controlling account assignments.

Cost Account Types

The G/L account type defines if an account is relevant for Management Accounting. G/L accounts which are relevant for management accounting are either set up as primary cost or revenue accounts, or as secondary cost accounts.

Cost Account Types

Primary and secondary costs are further subdivided into cost element categories. In the figure below, you can see some examples of P&L accounts and their associated cost element category:

In this course, we focus on business transactions that use the following cost element categories that will be explained in more detail later (the categories are fixed in the SAP system):

  • Category 01 – Primary costs/cost-reducing revenues.

  • Category 42 – Secondary costs – assessments

  • Category 43 – Secondary costs – internal activity allocation

As an example of cost-reducing revenue, imagine you sublet part of an office building you are renting. The rent you receive reduces the rent expense; it is not considered sales revenue.

How to Check Controlling Settings of Cost G/L Accounts

You want to identify where the controlling settings are in the G/L account master data. Check out the video below to see some examples of cost accounts:

Check Controlling Settings of Cost G/L accounts

Log in to track your progress & complete quizzes