What is cumulative allocation in SAP CO - Controlling?

SAP Term: cumulative allocation

• Component: CO

• Component Name: Controlling

• Description: An allocation method that smoothes out fluctuations in the tracing factors or in the sender amounts to be allocated, enabling assignment of the allocated costs on a cause-and-effect basis. Cumulative allocation smoothes the allocation across periods. Cumulative allocation is supported for the following: Assessments Distributions Periodic repostings

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• Key Concepts: 
  Cumulative allocation is a feature of SAP Controlling (CO) that allows for the allocation of costs and revenues over multiple periods. It is used to spread out the costs and revenues of a single transaction over multiple periods, allowing for more accurate budgeting and forecasting. 
  
  How to use it: 
  Cumulative allocation can be used in SAP Controlling by setting up a cumulative allocation cycle. This cycle will define the periodicity of the allocation, the start and end dates, and the criteria for allocating costs and revenues. Once the cycle is set up, transactions can be allocated using this cycle. 
  
  Tips & Tricks: 
  When setting up a cumulative allocation cycle, it is important to consider the periodicity of the allocation. The periodicity should be chosen based on the frequency of transactions that need to be allocated. Additionally, it is important to consider the criteria for allocating costs and revenues, as this will determine how accurately budgeting and forecasting can be done. 
  
  Related Information: 
  For more information on cumulative allocation in SAP Controlling, please refer to SAP Help documentation or contact your local SAP support team.