Please activate company code validation (mandatory)

What causes this issue?

Company code validation is inactive for CO area &V1& and fiscal year
&V2&.

System Response

Cross-company cost assignment is only possible for external postings<(>
,<)> such as material consumption in SAP S/4HANA.

How to fix this error?

Please activate company code validation.

Procedure for System Administrators

The system issues an error message and will not allow you to continue with this transaction until the error is resolved.

Error message extract from SAP system. Copyright SAP SE.