What is hierarchy settlement in SAP CO - Controlling?

SAP Term: hierarchy settlement

• Component: CO

• Component Name: Controlling

• Description: Function that enables you to create dedicated settlement elements within a project.

Smart SAP Assistant

• Key Concepts: 
  Hierarchy settlement is a process in SAP Controlling (CO) that allows for the automatic settlement of cost and revenue elements from one cost center to another. This process is used to transfer costs and revenues between cost centers in a hierarchical structure, such as a company's organizational structure. 
  
  How to use it: 
  To use hierarchy settlement, the user must first define the hierarchy structure in the system. This includes defining the parent and child cost centers, as well as the type of settlement (cost or revenue). Once the hierarchy is defined, the user can then run the settlement process. The system will then automatically transfer costs and revenues from one cost center to another based on the defined hierarchy. 
  
  Tips & Tricks: 
  When setting up a hierarchy for settlement, it is important to ensure that all cost centers are correctly linked in the hierarchy. This will ensure that all costs and revenues are correctly transferred between cost centers. Additionally, it is important to ensure that all cost centers have sufficient funds available for settlement. 
  
  Related Information: 
  For more information on hierarchy settlement in SAP Controlling, please refer to SAP Help documentation or contact your local SAP support team.