SAP PS - Cost Component

In SAP PS, you can use the Cost component to plan, monitor, and control project cost for projects. This component is integrated with different components in SAP ERP system −

  • Finance Accounting and Controlling
  • Production Planning
  • Material Management

Using cost function, you can perform fund management and budget allocation. In addition, you can perform cost planning using the cost function of SAP PS.

Cost planning

Cost planning means the costs that is expected to incur in connection with your project as it is executed. Cost planning is used for different goals as per the project stages −

  • At the Initial Planning Stage, you define cost planning as the base for an initial cost estimate.
  • At the Approval stage, you define it for the budget allocation.
  • At the time of project execution, it is used to control cost variances and monitor costing.

In addition, you can perform automatic cost planning to integrate project costs with enterprise controlling.

SAP PS – Create Costing Variant

In SAP PS system, you use Costing variants to manage the criteria for the costing. Costing variants are used to define the pricing strategy in the system for costing and how overhead should be determined.

A Costing variant contains the following components −

  • Costing type − Costing type is used to define the object - like a network, or a project for which you have to create the costing.

  • Valuation variant − In SAP system, you use valuation variant to maintain valuation bases for materials and activity types managed in the costing.


You determine the price to be considered in accounting view in material master record.

Costing variants are used to maintain unit costing in the general costs activity. To create costing variant in SAP system, follow the steps given below −

Step 1 − Navigate to SPRO → IMG → Project System → Costs → Planned Costs → Manual cost planning in WBS → Unit Costing → Create Costing Variant or use T-Code: OKKT.


Step 2 − To create new costing variants, click New Entries on costing variant screen.

Costing Variants

Step 3 − In the next screen, enter the following details.

  • Costing Variant − Enter four-digit alphanumeric unique ID to identify costing variant in SAP.

  • Control − Under control tab, enter appropriate options for costing variants.

Under Control Tab

Step 4 − Go to the Misc tab and enter the appropriate option for cost element for unit accounting.

Misc Tab

Click the save button to save the configured cost variant.

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