A division is a business-oriented subdivision within an enterprise. In simple words, a division represents a different line of businesses or products or brands.
You can assign managers to the divisions who will be responsible for profit/losses for that division.
Divisions are defined in HCM to define management organization hierarchy. This organization is then used to create organization based security profiles.

You can also represent the division in your COA, as you asked. Generally, companies choose their different brands, products, LOB in the division segment with management segment qualifier.
You also make it as secondary balancing segment qualifier, if you want to track profitability by this segment apart from company segment.