A key aspect of how CO and FI are integrated within the SAP S/4HANA system: 1. Primary Cost Elements: • Example: ○ FI: Salaries expense in the P&L statement. ○ CO: Salaries expense used in cost center accounting to track labor costs. 2. Secondary Cost Elements: • Example: ○ Depreciation: While depreciation is tracked in FI, a secondary cost element might be created to allocate depreciation costs to specific cost centers or internal orders based on factors like asset usage. In SAP S/4HANA, the distinction between cost elements and costs, whether primary or secondary, is fundamental to how Financial Accounting (FI) and Controlling (CO) interact and provide granular insights into an organization's financial performance. Here's a breakdown of the differences: 1. Primary Cost Elements What they are: Primary cost elements are essentially General Ledger (G/L) accounts from Financial Accounting (FI) that are relevant for cost accounting in Controlling (CO) ....