The functions of business area is to create balance sheets and profit and loss statement below the company code level.  It functionality can be duplicated using Profit center accouting.

OX03 - Creation of new Business Area

New Business Areas can be created anytime in the Enterprise structure in the IMG.  However, in the year of creation, no comparison can be done with the previous year data as the Business Area did not exist in the previous year and there are no postings in the previous year.

After create the new Business Areas, new G/L accounts should be created for :-

Sales
Cost of Sales
External Process Cost
Consumption
Material Change
Purchase
Cost of Difference for Production
Factory Output for Production Order

Next create a default account assignment to maintained the link for cost center and business area.

Transaction OKB9

Enter the Company Code and Cost Element
Cocd      Cost elem.      Acct assignment detail

Enter the details as per business area/valuation area
BA     Cost ctr

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