An Internal Order is a self-contained mini project cost object, i.e. it's a collection of costs, but not a full project with WBS and network relationships. The Internal Order should settle to Fixed Asset, Project, Cost and/or Profit Centers at the accounting period (month) end.
We can use overhead orders for detailed controlling for a particular object or activity. All costs related to this object or activity are assigned to the relevant order. We can use orders as internal cost objects.
For example if the company participate in 2 trade fair to target new clients .
Without Orders , we post costs for the two trade fairs directly to the cost center responsible for supporting these events. As external costs and internal activities have the same cost elements on the same cost center, we cannot easily determine which event created which costs.This means that we cannot make any further analyses for comparison purposes.
A further advantage is the wide variety of planning and budgeting functions provided for orders.
As With Orders , each event receives its own overhead order, the costs are collected separately. The settlement function allocates the order costs to the cost center responsible for supporting the trade fairs, which provides you with the organizational view of the costs. This enables us to analyze and compare the results of the trade fairs, even after the settlement has been made.
SAP MM Consultant