diff --git a/erpnext/accounts/report/financial_statements.py b/erpnext/accounts/report/financial_statements.py
index 97d2cdb..e66d20e 100644
--- a/erpnext/accounts/report/financial_statements.py
+++ b/erpnext/accounts/report/financial_statements.py
@@ -324,12 +324,17 @@
 		additional_conditions.append("posting_date >= %(from_date)s")
 
 	if filters:
-		for key in ['cost_center', 'project']:
-			if filters.get(key):
-				additional_conditions.append("%s = '%s'"%(key, filters.get(key)))
+		if filters.get("project"):
+			additional_conditions.append("project = '%s'"%(frappe.db.escape(filters.get("project"))))
+		if filters.get("cost_center"):
+			additional_conditions.append(get_cost_center_cond(filters.get("cost_center")))
 
 	return " and {}".format(" and ".join(additional_conditions)) if additional_conditions else ""
 
+def get_cost_center_cond(cost_center):
+	lft, rgt = frappe.db.get_value("Cost Center", cost_center, ["lft", "rgt"])
+	return (""" cost_center in (select name from `tabCost Center` where lft >=%s and rgt <=%s)"""%(lft, rgt))
+
 def get_columns(periodicity, period_list, accumulated_values=1, company=None):
 	columns = [{
 		"fieldname": "account",