valuation area

Materials Management (MM)

Organizational unit in Logistics dividing up a company for the purpose of valuating stocks in a standardized and consistent manner.


Business object


Inventory must be valuated at plant level for product costing and order costing.


Inventory is valuated either at plant or at company code level. At plant level, a plant represents a valuation area. At company code level, a company code represents a valuation area.

To valuate inventory in a plant, you must assign each plant to a valuation area. each valuation area is assigned to a company code for balance sheet purposes.