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Financials + Posting Examples and Integration to + Periodic Activities Explained General Ledger AccountingDieter Schlagenhauf, Jérg Siebert: ‘SAP® Fixed Assets Accounting (FI-AA) ISBN: 978-3-943546-22-4 (epub) 978-3-943546-21-7 (kindle) Originally published in German as ‘Anlagenbuchhaltung mit SAP" by Galileo Press, Bonn, Germany, in 2011 Translation: ‘Tracey Duty Cover design: Philip Esch, Martin Munzel Coverfoto: iStockphoto All rights reserved. 41®* Edition 2012, Gleichen © 2012 by Espresso Tutorials GmbH URL: www.espresso-tutorials.com Al rights reserved. Neither this publication nor any part of it may be ‘copied or reproduced in any form or by any means or translated into another language without the prior consent of Espresso Tutorials GmbH, Zum Gelenberg 11, 37130 Gleichen, Germany. 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Examples help illustrating a topic better by relating it to real SY, word scenarios Warnings draw attention to information that you should be ware of when recapitulating examples from this bok.Table of Contents 1 Introduction to Asset Accounting 1.1 Basic Concepts of Asset Reporting 1.2 Development of Accounting 1.3 Valuation According to US GAAP and IFRS 1.4 Group Valuation, Consolidation, and Foreign Currency 1.5 Summary 2 Inventory and Physical Inventory 2.1 Basics 2.2 Quantity Management in Fixed Assets 2.3 Fixed Value Assets 2.4 Physical Asset Inventory 2.5 Methods of Identifying Inventory 2.6 Reporting Procedure and Physical Inventory 2.7 Physical Inventory Procedure 2.8 Physical Inventory Postprocessing 2.9 Summary 3 Hierarchy of Asset Master Records 3.1 Hierarchy of the Balance Sheet, Financial Accounting, and Asset Accounting 3.2 Asset Class 3.3 Asset Number 3.4 Number Range Intervals 3.5 External versus Internal Number Assignment 3.6 Sub-Numbers 3.7 Working with the Asset Master Record 3.8 Asset as Account Assignment Object 3.9 Summary4 Business Processes and Posting Transactions 4.1 Acquisition 4.2 Transfer Posting 4.3 Retirement 4.4 Transfer 4.5 Write-Up 4.6 Summary 5 Periodic Activities in Asset Accounting 5.1 Depreciation 5.2 Periodic Balance Sheet Postings 5.3 Change of Fiscal Year and Year-End Closing 5.4 Summary 6 Evaluations in SAP Asset Accounting 6.1 Asset Balances 6.2 Day-to-Day Activities 6.3 Explanations for the Profit and Loss Statement 6.4 Explanations for the Balance Sheet 6.5 Summary ‘A About the Authors: B Disclaimer1 Introduction to Asset Accounting Drawing up a balance sheet means presenting the values of the assets and liabilities of a company. A considerable proportion of the assets are fixed assets. Here you will learn what fixed assets are, how the value of fixed assets has to be reported, and how SAP Asset Accounting can support you. ‘This book focuses on the valuation of asset objects. Fixed assets are part of the assets of a company — generally the major part. Within accounting, asset accounting is responsible for creating this asset presentation, if necessary according to multiple accounting regulations, ‘The SAP Asset Accounting solution is a tool that enables you to do this, In order for you to understand the task and tools of asset accounting, this chapter first presents the development of the accounting regulations and the differences between them with regard to the valuation of fixed assets. (SAP did not invent accounting — despite this, the development of accounting is reflected in SAP Financial Accounting and SAP Asset Accounting.) 1.1 Basic Concepts of Asset Reporting [Anyone who has tried to sella car knows this problem: how much is the car currently worth? There is hardly any question that is more difficult to ‘answer, particularly when the car in question is your own. Every owner thinks it is worth a lot; every interested party thinks it is worth less. ‘The task of accounting is to report the assets and liabilities of a company at a specific date as a monetary value, This monetary value must be determined for each object individually and documented in a book. The book is called the inventory, and the monetary value, because it is recorded in a book, the book value. This theoretical valuation for thousands of objects on a key date can only be performed in accordance with a standard set of rules — a set of rules that stipulates how the individual objects are to be valued. This set of rules is known as an "accounting regulation." As there are numerous such accounting regulations, the values of the individual objects and, in end effect, the assets of a company, are different depending on the specific regulation applied. Accounting can be performed based on the principles of US GAAP, IFRS, or other local legislation.41.2 Development of Accounting ‘Accounting has its origins far back in history. As far back as 1728 BC, the Babylonian Code of Hammurabi prescribed that traders had to perform accounting. Even the ancient Romans kept books (also known as ledgers). The current form of double entry bookkeeping evolved in the Late Middle Ages in the trading towns of northern Italy. Therefore, it is sometimes also referred to as “Italian” bookkeeping. Double entry bookkeeping was described in detail for the first time by the Italian mathematician and Franciscan monk Luca Paciol Pacioli wrote one of the first standard works on accounting. This work appeared in 1494, presenting the form of double entry bookkeeping still in use today for the first time. Many of the terms and procedures described by Luca Pacioli are stil used in legislation today. Paciolis explanations on inventory and valuation are relevant for asset accounting. Thus, the inventory was already the fundamental element of commercial accounting as early as 1494. According to Pacioli, the trader must enter, in a “special book,” what he believes to own in the form of property and moveable assets. Specification of the date, location, and name of the trader make it possible to identify and check the individual objects in the inventory. lf you compare these specifications from the 15th century with the input fields in the SAP asset master record, you will find a lot of similarities immediately (see Figure 1.1): today, just as back then, the name, umber, and date are the basic prerequisites for being able to check the individual objects.(BL) Change Asset: Master data UB Avevaves net TET Taig trata on on conocoe S57 os a ba eee w com it | ne aay os 5 Coa roe — a Kaname a Ore © Copytght SAP AG. Al gh eter Figure 1.1: Asset master record, general data At the same time, Paciol’s note that the inventory must be prepared on ‘one and the same day gave rise to the balance sheet or accounting date. ‘The description of the order of the structure— recording items that can be easily lost first—introduces a balance sheet structure. Pacioli inventory primarily addresses the number of individual objects present. After this ‘uantity-based determination of the inventory, each individual item must be valued. A consistent sequence is important, because something that does not exist or no longer exists has no value. In Chapter 16 of his work, Luca Pacioli specifies the monetary value to be applied for the individual items in the inventory. Here, Pacioll writes that the value must be based on the monetary value usual on the market. This isa clear indication of what we call the current market value or fair market value today — that is, the monetary value at which the object can be traded on a specific day. It is a valuation that applies generally forall later forms of accounting. Despite this, the dilemma of this valuation with market values becomes very clear when we look at it more closely. Even in Pacioli's time there was not necessarily an active market for all goods. In particular, it was very difficult to determine a current market value for objects that were nottraded on a daily basis. To solve this problem, the original price paid (and thus known) for these objects was documented. A lower valuation was only to be selected if it was subsequently discovered that this price could no longer be realized, ‘The knowledge that the loss of value in the original price arises mainly through use of the object gave rise to a very important valuation variant. Paciol's successors came up with an idea: the wear-based decrease in value of the price, also called depreciation, was distributed over a probable and thus estimated useful life of an object. Thus, scheduled depreciation was established. Depreciation is the reporting of a decrease in value, that is, in principle, something negative. It was precisely this estimation of the useful life that finally led to the definition of fixed assets. Since then, all objects in the inventory that are intended to fulfil a purpose for the company over several years are assigned to fixed assets. ‘The methods of Pacioll and his successors have proven themselves and become established in many countries. 1.3 Valuation According to US GAAP and IFRS. For a long time, the intemational capital market has required standardized reporting of a company’s assets (ie., reporting that is not influenced by national regulations). Originally, ‘the US accounting regulations US GAAP (United States Generally Accepted Accounting Principles) were used for this purpose. For Europe, the IAS (International ‘Accounting Standards) were later developed: they are now known as. IFRS (International Financial Reporting Standards). Both sets of accounting regulations are only marginally different with regard to the valuation of fixed assets ‘The inventory and the principle of individual valuation are also anchored in US GAAP and IAS/IFRS. Here too, the valuation is generally according to the historical cost principle, and reduced by accumulated depreciation, However, US GAAP or IAS/IFRS place considerably more value on a “real" reporting of the asset value. The development in these two accounting approaches goes back to fair value accounting again, ‘Therefore, under strict regulations, valuations. above acquisition/production costs are possible. On the other hand, low market value (impairment) must also be reported. These decreases in value ‘must be determined by impaitment tests. 1.4 Group Valuation, Consolidation, and Foreign Currency‘A group arises when a company can exercise a controlling influence over another company. In consolidated financial statements, the asset situation of all companies involved must be reported as if the group were ‘one company. In the individual companies, the fixed asset objects are also valued ‘according to the accounting regulations of the controlling company (.9. IFRS, US GAAP, local GAAP). If there are no quantity and value movements between the group companies, the fixed assets of the individual companies, valued according to group specifications, can be summarized in a group inventory. If there are movements from oto fixed assets between individual companies in the group, these transactions must be neutralized, or rather, consolidated. Even immovable fixed assets can move around within the group. Company A acquires an older building from company B. Company A renovates the building acquired eg extensively (new roof, new windows, new heating system, etc.) For company A, the renovation costs are part of the acquisition and production costs as purchase-related ‘expenditure. The increase in assets as a result of the purchase price and the renovation costs is visible in the inventory of company A as a new building. The total expenses would be written off over 50 years at 2% (= German GAAP). From the group view: if companies A and B were one company, nothing would change in the fixed assets; everything would stay as originally presented for company A. The renovation costs would be merely necessary maintenance expenditure and would therefore reduce the group profit immediately. In its Asset Accounting module, SAP offers special functions for group- specific asset changes. For example, group companies often require balance sheets in the national currency from their subsidiaries, e.g., US Dollar. However, a translation at the respective balance sheet key date would make the historic costs incorrect due to exchange rate fluctuations, In SAP Asset Accounting, you can manage a separate valuation area in foreign currency. In this area, the translation takes place when the asset acquisition is posted, at the daily exchange rate applicable then. The other values remain fixed. 4.5 SummaryYou have now leamed some facts about how accounting developed, about the inventory, and about valuations for the inventory. You have learned above all that there are several, parallel accounting approaches to be reported: for the tax authorities, you have to create a valuation according to tax law; intemational addressees expect balance sheets according to the specifications of IFRS or US GAAP. Overall, asset accounting is a highly complex task for accountants and SAP support ‘employees. You can use the organizational structures in SAP to meet the requirements. For fixed assets in particular, you must analyze how many different accounting regulations (known in SAP as valuation areas) have to be managed and with what respective priority,2 Inventory and Physical Inventory ‘Objects that no longer exist have no value. Therefore, the existence of fixed assets must be checked by means of an annual physical inventory. The individual objects in fixed assets must therefore be recorded such that they are identifiable. In Chapter 1, we referred to the inventory — the record (directory) of the individual asset objects. This directory must report the asset objects present on a specified date. These objects must be determined by a physical check, also known as a physical inventory. The word “inventory” Is derived from the Latin “invenire," meaning to find something. In this chapter we will explain what you have to list in the fixed assets inventory and how to perform the physical check. 2.1 Basics ‘Our national tax and accounting laws regulate what information the inventory directory must contain. These laws also regulate how and at what time intervals a physical inventory must take place. ‘The verification that the individual assets listed in the inventory directory are actually present can be provided by a physical inventory, meaning that the assets should be viewed and counted individually — which can be a very time-consuming measure. ‘Accountants are often accused of being bean counters. Quite apart from the fact that this statement is not a compliment, itis also incorrect. The ‘administrative effort involved in checking and reporting the value of fixed assets can and must be kept within reasonable limits. The principle of proportionality is also applicable here. 2.2 Quantity Management in Fixed Assets Indeed, you can manage identical capital goods in the inventory as one single item, with specification of the quantity. In the sense of valuation, identical means the following: P Identical date of acquisition > Identical acquisition and production costs > Identical depreciation methodFor example, 80 personal computers could be managed under one asset number. However, this variant for the master asset (unfortunately frequently used) will certainly lead to considerably more effort later in the maintenance of asset balances: for example, these 0 personal computers will not leave the company all at the same time, meaning that time-consuming partial retirements are necessary; they will also not be used permanently in one cost center, thus requiring extensive partial repostings instead of simple cost center changes. This type of inventory management causes the greatest problems for a Physical asset inventory. How can you determine whether all 50 computers of this asset are still present? The individual PCs cannot be identified via asset accounting. However, annual evidence by means of a physical inventory is still required. This evidence would require additional individual inventory management outside or in addition to asset accounting. Thus the company still has the administrative effort and there Is therefore no benefit, We therefore strongly advise against this type of inventory management. SAP Asset Accounting offers very convenient functions for creating and posting this type of mass acquisition with the initial purchase. We will address these in Chapter 3, "Hierarchy of Asset Master Records.” Quantity details are however stil useful for certain capital goods, for example, for low-value assets that are presented as flat-rate assets, Figure 2.1 shows an asset with a quantity of 57 items; Figure 2.2 shows the movements for this asset. cae SOF Latctes mart) ComparyCoue FIED Cezerten cece @ secrdaemisson (EGE) Lowa atts ‘Seranber erty nba ‘uary 7 FE) rece) Manage tray © Copyrht SAP AG. Al ghis ero. Figure 2.1: Asset with quantity‘Transactions pawialete fret Type Tonssctnnpename Cry Aes | Doeet [0.01 20%2e} 50000 100" Cotenalecsetacuuseon USO 2oOmm00000 § 05012012” TOMO 100 Exera see acquson USD SONOOOEO 6 © Copyrght SAP AG. Al ghis reser. Figure 2.2: Movements for this asset For real estate, we recommend specifying the number of square meters, ‘as shown in Figure 2.3. orate Deseston (ent Pain Ht @ ‘ectanumeseon (10800 | Realestate ad snares oy © Copyrght SAP AG. Al ghis sere Figure 2.3: Asset with square meters ‘The evidence of ownership for real estate is not provided by means of a physical inventory but by the entry in the register of deeds of the ‘corresponding plot of land number. 2.3 Fixed Value Assets Individual verification of some objects in fixed assets can involve a great deal of effort — effort that is usually out of proportion. Typical examples are scaffolding and casing parts in the construction industry, or tableware and bed linen in the hotel industry. Beverage and transport boxes and {gas bottles also come under this category. These objects are generally subject to only few quantity-based and value-based changes. AS defective objects are regularly replaced, their stock level generally remains constant. What all of these goods have in common is that an annual physical check would be very time-consuming. This effort cannot be justified due to the low number of value fluctuations mentioned. In fixed assets, these objects can be presented as one individual asset with fixed acquisition and production costs — a fixed value asset. Thereis no depreciation for fixed value assets. Figure 2.4 shows the selection of the depreciation method No depreciation and no interest. Figure 2.5 shows that over the years, no depreciation has been applied. ven = xorg pos ces 55 ‘edna congaycose FIED 'Dewecoin wea Okey Use Ped O09 St Suave 000 onor 2012 jal Dep.” New fowl depen (© Copyraht SAP AG. Al ighis reserve. Figure 2.4: Asset with"No depreciation and no interest” DSi Om stnneme © Copytgt SAP AG. Al gis exer Figure 2.5: Asset History Sheet 2013 However, a regular physical inventory is also mandatory for these fixed value assets, although not on an annual basis. To check the changes in fixed value assets in the long phases between physical inventories, we recommend the following: 1. In SAP Financial Accounting, set up a separate balance sheet account for the fixed value assets and a separate asset class in SAP Asset GoogkAccounting. 2. In SAP Financial Accounting, also create a corresponding expense ‘account for posting ongoing stock additions for each fixed value item in fixed assets. 3. Check these expense accounts regularly. Extreme annual fluctuations can indicate a change in the respective fixed value asset, De not take the fixed value concept to far, particularly if individual stock monitoring takes place in the MBD™ company independently of the accounting department. For example, if individual monitoring is performed for “SS gas bottles’ for technical reasons, this technical procedure can be used to verify the stock. There is then no addtional operating effor necessary from a physical invento 2.4 Physical Asset Inventory ‘Something that is unfortunately often neglected is the necessity of identifying movable assets uniquely. The assets must be recorded in SAP Asset Accounting such that they can be identified. For large stocks in particular, this is an essential prerequisite for a physical asset inventory ‘or for a reporting procedure that replaces the time-consuming annual inventory count. You should always try to use the SAP asset number as the unique designation. Alternatively, you can use the SAP master data field Inventory Number to manage an alternative number to the asset number. Figure 2.6 shows an asset master record with an altemative inventory number to the asset number. However, over the years, this method causes an unnecessary additional effort in data maintenance for fixed assets. The asset number constantly has to be determined via the inventory number.a — @ ‘Seems ia oes == a © Copyrght SAP AG. Al ghiseeere Figure 2.6: Asset with inventory number Of course, not all asset objects can be identified physically. This physical identification is impossible for intangible asset objects, and not very useful for real estate, buildings, vehicles, etc. The stock of these asset ‘objects can and must be verified by other means: > For realestate, va the enty inthe registry of deeds > For vehicles registered for use on the road, via the license plate ‘number or the vehicle ownership papers ‘The physical inventory identifier, usually a label with a number, is often, and not entirely incorrectly, called the inventory number. However, this identifier must frst be created and attached to the object. 2.5 Methods of Identifying Inventory Unique, unmistakable identification of an object is a prerequisite for the legally prescribed physical inventory and for a reporting procedure that replaces this physical inventory. Physical inventory identifiers are used for the purposes of this unique identification. Almost any method of affixing the identifier is possible: painting, riveting, welding, branding, sticking. For animals (they can also be assets), ear clips with RFID (Radio Frequency Identification) tags are also used. ‘The physical inventory identifiers represent a main feature of the asset, and they are designed for permanent use — for ten years or more, even under extreme conditions in production. Therefore, the manufacture and attachment of a physical inventory identifier can involve a lot of effort‘The simplest and cheapest type of identifier is an adhesive label. It can be printed quite cheaply and simply, can be sent easily, and attached to the object by technical lay persons with litle effort. High-quality adhesive labels stick to almost every surface permanently, have a long life, and if they have bar codes or RFID tags, can be read by machines. In principle, it is advisable to connect the inventory identification procedure with the goods receipt check. Easily movable objects in Particular, for example, notebooks, should already be identified before delivery to the users. C } C i 4 HAP toy n. Figure 2.7: Metal label for HIPP PAULANER Neg ia Figure 2.8: PAULANER adhesive labelar lel & Goltermann tl Figure 2.9: Adhesive label with bar code However, there are also technical and organizational limits for adhesive labels. For example, it is not advisable to attach a small inventory identifier to very large objects. For a physical inventory or change report, the search for this "postage stamp" can be extremely time-consuming, Figure 2.10 shows a dredger bucket with a welded inventory number. Figure 2.10: Identification on a dredger bucket When identifying objects, make sure that you follow a standard procedure — for example, the inventory identifier should be positioned as close to the object name plate as possible. 2.6 Reporting Procedure and Physical Inventory GoogleChanges to individual assets are interesting not only for asset accounting and financial accounting: timely information about changes to individual objects is also important for other areas of the company (technology, insurance), Itis very unsatisfactory if these changes are only discovered at the end of the fiscal year during an annual physical inventory. Changes to individual assets should be reported continuously via an operational reporting procedure anchored in asset accounting. In this context, changes refer not only to asset retirements (scrapping, theft, and sales): they also include changes to the cost center or location of the object. In principle, these reports can be informal. However, most companies use forms. Depending on the size of the company, there are very different solutions — from complicated forms with strictly regulated signature procedures and multiple cycles to informal information via e-mail Regardless of what the report looks like, the decisive factor is that the information arrives in asset accounting and is processed promptly there. If this type of reporting procedure is in place, you do not have to perform an annual physical inventory of the entire fixed assets. Despite this, the quality of the reporting procedure should be checked by means of inventory sampling procedures — samples that can be restricted to individual departments respectively. Regardless of whether it is the annual physical inventory or an inventory sampling procedure, at some point a physical asset inventory is necessary. 2.7 Physical Inventory Procedure (One of the simplest physical asset inventory procedures is checking the stock using printouts from SAP Asset Accounting. Figure 2.11 shows how to call up a physical inventory list; Figure 2.12 shows the objects to be checked.‘comoany cade ro » @ Repot dae sR Depreciton ea oF usowe © copytght SAP AG. Al ghee. Figure 2.11: Calling up the physical inventory list ventory st saQ0emy Bar nvtery mater [eet osoripton [ba antes sconsooronz oot sce era - marcos 29.09 0 ena ‘© Copytgt SAP AG. Al gh esa Figure 2.12: Physical inventory lists — sorted by cost center This check is usually performed sorted by cost center. The cost center ‘manager is responsible for physically checking the items on the printout and confirming them with a checkmark against the Inventory number, as well as with a date and signature. Special notes from the asset accounting department can also be provided in the Comments column). Any assets managed in the cost center but not listed on the printout must Googlealso be reported In our experience, this procedure with distributing and checking off physical inventory lists is very prone to errors. Missing assets are often not reported; the uniformness of the checkmarks on a physical inventory list generally indicates that the physical check has not been performed properly. A more precise method is a physical asset inventory with a “blank” form on which no assets are printed. The person performing the physical inventory has to record all objects present—naturally, together With the inventory number of the object—and must also note objects that have no identification. These days, this blank form does not have to be a sheet of paper — the difficult and time-consuming reading and noting of inventory numbers can be supported by IT. For inventory identifiers that can be read by machines, the inventory numbers can be transferred to the blank form easily or the form itself replaced by MDE (mobile data entry) devices, small computers with bar code scanners, or RFID receivers. Inventory identifiers that can be read by machines in connection with correspondingly programmed MDE devices ensure long-term inventory recording with low time effort and cost expense. The time-consuming subsequent processing of the physical asset inventory can also be supported technically, enabling further time and cost advantages. However, the fact remains that a physical check is not possible forall fixed asset objects. Some objects cannot be verified by a physical inventory — they are checked by means of book inventories. The term comes from the ‘ownership evidence for real estate: in this case, the verification is provided by entries in the registry of deeds, that is, by comparison with another book: > Intangible assets can only be verified by book inventory. > Software usage rights or patents should be verifiable via license agreements or patent rights. > Financial assets, investments, or loans in fixed assets can be verified with bank statements and contracts. > Ownership of vehicles is usually verified by the vehicle registration papers. > ownership of realestate and buildings, as already mentioned, s documented by entries in the registry of deeds. Despite this, buildings must also be checked physically.> Down payments for assets can be verified by payment transactions. and balance confirmations. Regardless of the respective inventory count procedure, additional information can be given to the asset accounting department for each asset (eg., "no longer required"). All inventory count procedures can have loopholes and should therefore be checked by third parties, internal audit, or external auditors via samples. The decisive part of the physical inventory, the subsequent processing, begins after the recording of the inventory. 2.8 Physical Inventory Postprocessing A physical asset inventory is performed to detect deviations to the inventory in asset accounting and, where necessary, to add to andlor correct this inventory. Proceed as follows: 1. You can generally save the date of the last physical inventory in the SAP asset master record (field: Last Inventory On) without any checks and, where applicable, the physical inventory note. Figure 2.13 shows these entries in the SAP asset master record. The last physical verification took place on December 31, 2012 and during this physical inventory, the information was received that the desk is no longer needed. ‘TST ice desk mance (uso nner) ‘00 waGeaws mart) Coreanycece FICO) eres Desegton once eck eance agus wher @ cctemmiton ED) ona ass vat rnb uy a0 Moraga [a RFRA TESS rare ares For example, why was an asset not found? > Was this asset being repaired at the time of the physical inventory? > Perhaps this asset was scrapped without notification to the asset accounting department. The asset may appear on the physical inventory of another cost center. ‘These questions must be asked and clarified. 3. After checking and clarifying the deviations, you can make cost center changes in SAP Asset Accounting. Figure 3.32 shows the cost center change for an asset. (B} Change Asset: Overview of time Intervals: Cas 08 Daa more) Corpnycote (FC (© Copyrht SAP AG. Al ghis reson Figure 2.14: Cost center change ‘You may have to post asset retirements (scrapping, theft) or calculate current value depreciation. It may even be the case thal, for deviations detected, you have to pay back any subsidies received and/or add back special depreciation affecting net income that has been deducted. ‘As you can see, almost all posting transactions for asset accounting that we describe more closely in Chapter 4 can arise in physical inventory postprocessing, 2.9 Summary In this chapter, we have made you aware of the interactions between the asset inventory and the physical asset inventoryireporting procedure. You have to set up fixed assets such that the assets are identifiable and canbe verified. The assets that you set up and maintain in SAP Asset ‘Accounting (FIA) now will stil being used in decades to come. You have to take this into account precisely in FI-AA when you enter and maintain asset master records, To enable you to enter assets economically while still making them verifiable, SAP Asset Accounting offers numerous options for setting up the entries according to asset classes. We will look at these in Chapter 3.3 Hierarchy of Asset Master Records Asset accounting is about balancing an account. Before we look at the actual SAP asset master record, let us address the hierarchy of the balance sheet, financial accounting, and asset accounting. Then we will explain the control functions of the asset class. You will learn about the options for setting up the asset master sheet. We will also show you how to work with the asset master record. At the end of the chapter, you will learn why and how the asset number is used for account assignment. 3.1 Hierarchy of the Balance Sheet, Financial Accounting, and Asset ‘Accounting In the balance sheet, the fixed asset values are reported via balance sheet items. Initially, the fixed assets are classified into the items Intangible Assets, Tangible Assets, and Financial Investments. Within these classification levels, the assets must be classified further. Figure 3.1 shows a corresponding balance sheet structure in SAP Financial ‘Accounting up to account level, 7 Serena 3X ant 0d teen ootanong aft Acquistion "'atepes) foe‘©Copyright SAP AG. Al gis exer. Figure 3.1: Balance sheet structure in SAP Financial Accounting In SAP Financial Accounting, there must be at least one balance sheet account for each balance sheet iter in fixed assets. The balances of all accounts assigned to a balance sheet item make up the value of this item. In SAP Asset Accounting integrated with SAP Financial Accounting, these balance sheet accounts must be designated as reconciliation accounts of account class A, In accounting, we generally differentiate between balance sheet accounts and profit and loss statement BD eccounts > Balance sheet accounts subdivide the afore- “=== mentioned balance sheet items » Profit and loss statement accounts subdivide the items in the profit and loss statement Viewed strictly, even the profit and loss statement accounts are balance sheet accounts, merely representing in more detail the change in a major balance sheet item — equity capital. Typical profit and loss statement accounts in asset accounting are the depreciation accounts and the accounts for profits or losses from relirements of assets. In every accounting system (not just those using SAP), the fixed asset balance sheet accounts are broken down further into assets. The account balance of an asset account must be verified by the values of the assets assigned to this account. This brings us back to the SAP asset master record. Somewhere in SAP Asset Accounting, an asset must be assigned to its balance sheet account. In the SAP system, this takes place via the asset class and the account determination defined in this asset class. ‘The asset class introduces a further, purely organizational hierarchy level between the balance sheet account and the asset in the SAP system, Figure 3.2 shows the SAP Asset Accounting asset classes assigned to balance sheet account 22000.‘Asset Balances - 01 US-GAAP. Repo: 8112202 Crm 2182082 © Copy SAP AG. A ghie eeerved Figure 3.2: Balance sheet account with asset classes ‘The assignment of an asset to an asset class is the deciding factor for the account assignment of an asset. For the asset accountant, in SAP ‘Accounting, the problem of G/L account assignment has moved to the selection of the asset class. To create a new asset master record, the accountant therefore has to select an asset class. Figure 3.3 shows the initial screen for creating an asset, with the asset class selection list. Create Asset: Initial screen Nase es Oneeatan eas (© Copyigt SAP AG. Al gh exert. Figure 3.3: Asset class selection for creation of the asset master record 3.2 Asset Class Google‘The SAP asset class does more than just regulate the assignment to the respective balance sheet account. It also contains important control functions for creating an asset master record. We will look at some of these functions here. > The asset class is used for account assignment. Remember that by selecting the asset class, you assign the asset to a balance sheet account in SAP Financial Accounting, and this balance ‘sheet account is used for account assignment and drawing up the balance sheet > You cannot change the asset class. Correct assignment of the asset class is therefore vitally important. ‘Once you have created the asset, you can no longer change the assignment of the asset to its asset class and thus the assignment to the balance sheet account in SAP Financial Accounting. The individual asset remains connected to its asset class and thus its balance sheet ‘account permanently. > Do not change the balance sheet assignment of a balance sheet account. In SAP Financial Accounting, you can change the assignment of a balance sheet account to a balance sheet item at any time. However, you must not change fixed asset balance sheet accounts. > Account transfers only via SAP Asset Accounting If an asset moves to a different G/L account, for example, undeveloped real estate becomes developed real estat, in SAP Asset Accounting, this means that you have to create a new asset with a new asset class. for the receiving balance sheet account. An asset must only be transferred to a diferent balance sheet account and thus potentially to a different balance sheet item via the SAP Asset Accounting functions (for more information, see Chapter 4, Business Processes and Posting Transactions"). 3.3 Asset Number Every asset requires unique and therefore unmistakable identification. This identification usually takes the form of a numerical value, the inventory number that we have already mentioned (see Chapter 2, “Inventory and Physical Inventory”). Ideally, this number is identical to an identifier attached to the object. Since this does not always have to be the case (for various reasons), this unique designation within SAP Asset Accounting is known not as the inventory number but as the asset number.‘The asset number is composed of two elements: the main number and the sub-number, Figure 3.4 shows this unique asset number in the highlighted area. Beneath that you can see the specification of the asset class. > Here, the main number should not be interpreted as a pure numerical value. For the main number, in SAP Asset Accounting you can use alphanumeric values. In SAP Asset Accounting, an asset number can be "ABC 12345" or "INTERN-00001," for example. > In SAP, the sub-numberis a purely numerical valu: when a master record is created, the sub-number receives the value 0 (zero) automatically. Create Asset: Master data “emesapetert_| Mocs sce od oun Pee @ ects SG) Fees nats uve Unssenotneay (© Copyigt SAP AG. Al ge eerie. Figure 3.4: Asset with main number and sub-number How do you assign this asset number? This is also regulated indirectly via the asset class. The asset class contains the specification of the number range, or more precisely, the number range interval responsible for the assignment of the asset number. 3.4 Number Range Intervals Within SAP Asset Accounting, the assignment of asset main numbers is controlled by number ranges. Figure 3.5 shows number ranges with their intervals for the assignment of the main numbers. In intervals, number ranges are defined in the Columns From Number and To Number. Withintemal assignment (no checkmark in the Ext. checkbox), the number level shows the last asset number assigned For interval 01, for example, number range 1 to 1999999999 is reserved. ‘SAP Asset Accounting performs the number assignment — that is, the system assigns an asset number. In this example, number 2 is the last ‘main number assigned, ‘Maintain Number Range Intervals Brew BS Noe eernreal 1 [meena ] [pena ener Career eB 3. sena0cce60 ‘soo00000999 ——_~socceeeoonot : & sooooococos0 | «aonoooooa00-—«—«‘oconeo0ecd 40. 2o0000co00 aeons =o ©Copyright SAP AG. Al ghis reson Figure 3.5: Number range intervals Interval 10 is reserved for the range from 900000000000 to {999999999999, and interval XX for the alphanumeric range from A to 222222227722. Both intervals require the user to enter the main number — the checkmark is set in the Ext. checkbox. For extemal assignment for SAP Asset Accounting, the number level is irrelevant and therefore not shown. You should use as few intervals as possible for internal assignments and thus set up thei rom ranges very MP conorously. in our opinion, for asset accounting, one internal interval is sufficient. Any attempt to derive balance sheet accounts or even asset classes via the asset numbers will eventually fail, To avoid overlaps, define the number ranges for external intervals as far removed from those of the internal intervals as possible.3.5 External versus Internal Number Assignment In the same way as for many assignments of unique key terms in the ‘SAP system, two variants are generally possible for the asset number. Either the user enters this unique identification externally, or the system assigns it internally For external assignment of the main number, the user enters the number or the alphanumeric value. The user must therefore know which number has to be assigned next or which numbers have not yet been assigned, For example, if predefined, sequentially numbered inventory identifiers are used and these identifiers are stored with the user, extemal assignment can make very good sense. However, if there are several users, potentially also in different locations, this requires a distribution of the predefined inventory numbers to the different users. Every user thus has his own external number interval. User A has number range 1 to 9999, user B 10000 to 19999 etc. If multiple company codes are also operated at different locations, the potential problem multiplies very quickly. The same situation applies if a User processes multiple company codes. In these cases, external assignment of the main number You can see the effect of the External Sub-Number indicator in the ‘number range interval on creation of a master record in Figure 3.6. Create Asset: Master data UD ress oon Tce mee) CameayCote Feo Tinesedee (Acai, umvitTa_ Oop es omen ——————————— secrsmereson ‘Elva ets © Copytght SAP AG. Al ght eer Figure 3.6: Exteral assignment of the asset number Here, the manual (extemal) entry of the asset number by the user is‘expected in the first field. The system checks whether this number has already been assigned. If it has, the system would issue an error message. Figure 3,7 shows an asset number assigned externally by the user. In this case, the user deliberately assigned a meaningful main ‘number, composed of the cost center with number 9000, an underscore *_*, and the fiscal year 2012, Change Asset: Master data BB sons set SER ce Unione ar) camwancn FCS cos een Oe concen aa) yom Pecoras a rs) (©Copyright SAP AG. Al ght eeare. Figure 3.7: Extemally assigned asset number ‘A meaningful asset number as shown in Figure 3.7 mao th account atten fer mass Yanceton WD Sevisratiy caer. Under come crcutance, tore are thousands of assignments and postings to such “sue assets. In larger companies, several users in different locations can be responsible for creating assets for numerous company codes. In these cases, intemal assignment of main numbers by the system is unavoidable. Here, SAP Asset Accounting assigns the next free main number, controlled by the number interval. Figure 3.8 shows an asset master record for asset class 3200,Descreton Conse a ec ernie (SR) Fate rte cane, Moraga © copyrght SAP AG. Al gh eeere. Figure 3.8: Internally assigned asset number Asset class 3200 is assigned to number range 03, an interval with intemal number assignment by the system. Here the system assigned asset number 4000000000, 3.6 Sub-Numbers Every time you create a new asset master record, the sub-number 0 is assigned automatically. In addition, you can create further sub-numbers for one main number. From a technical perspective, every sub-number is an independent asset master record, the main characteristics (asset class, account determination, screen layout rule, etc.) of which, however, are identical with those of sub-number 0. You can use an additional sub-number to classify the asset further where necessary. The assignment method for the sub-number is regulated in the asset class. Here too, a checkmark in the External Sub-Number checkbox can define whether assignment is external and manual or performed by the system, ‘The sub-number is intended for special valuation cases. Often, certain volumes of the acquisition and production costs of an asset have to be depreciated differently to the method used for sub-number 0 as a result of tax regulations. This could be the case for a general ovethaul of a machine that has been fully depreciated where the overhaul has to be capitalized; the same applies to an extension of a building that has already been fully depreciated. In such cases, the subsequent acquisition and production costs could be subject to valuation rules separate to sub- ‘umber 0.3.7 Working with the Asset Master Record Even acquisitions in the current year can require an additional sub- ‘number from a valuation perspective in very rare cases. Here, “working with the asset master record” means the classic database functions: create, change, and delete. Creating an asset is by far the most time- consuming activity. 3.7.1 Creating a New Asset Master Record We will show you how to create an asset master record using a posting ‘example. You will encounter this example again in Chapter 4, "Business Processes and Posting Transactions." The invoice document in Figure 3.9 represents the purchase of a pickup truck. carina 8) Hah ee onda, 02386 fngard roescow woe anyon ore Bsr SesarrTON aay — [Rane — [vou Pickup truck '50,000 USD TAK10% 5,000 USD TOTAL 55,000 USD ‘THANK YOU FOR YOUR BUSINESS! Figure 3.9: Pickup truck invoice‘As already mentioned, you create a new asset and perform the account assignment by assigning the asset to an asset class (see Figure 3.10). Here, company code FICO was selected as the business owner of the asset, Create Asset: Inia screen =. 5s © Copyraht SAP AG. Al ghis reser. Figure 3.10: Creation of the new truck asset — initial screen If there are multiple identical assets, you can enter the quantity via the field Number of Similar Assets. If number assignment is intemal, once you have created the first asset, further assets are created corresponding to the number entered. They receive the same content as the first asset. Note that you may have to rework entries such as the serial number, cost center, of location, In the template field group, you can select existing assets to copy, even assets from other company codes. ‘The Post-Capitalization checkbox is reserved for items that were not created as assets in previous fiscal years — facts that were usually detected during tax audits and that require special posting transactions, known as write-ups. The capitalization date of such assets must be before the fiscal year of the write-up posting. With the Post-Capitalization Indicator, these types of assets are permitted for write-up postings of the acquisition and production costs. We will address write-ups in Chapter 4, “Business Processes and Posting Transactions.”(@) Change Asset: Master date 1 Actas cm B00 wees Conprycoce (FIED sectors (3G )_‘Fonres ann: erty umber ‘ur, Marge heresy ey Pong tomaten cseaseen a Desesen © copyrght SAP AG. Al ghis reserve. Figure 3.11: "General" tab ‘Once you have completed the initial screen, the entry screen for the first asset master record tab appears: the General tab (see Figure 3.11) Here, the asset number is already displayed, due to internal assignment, and you cannot change it. You have to enter a name/description for the asset. You can also make entries in other input fields but you do not have to (yet) In addition to the asset number, the frst name you enter is displayed or printed with virally all MD cvauations. Therefore, make sure that you enter a ‘meaningful text. The second line should also contribute to identifying the asset, describing the object in more detail. Therefore, avoid using changeable information One of the important fields here is the Capitalized On date field. Youhave to make an entry in this field either before or at the same time as the first posting. The date of availabilty to the business is relevant here, ‘This date is decisive for the display in the asset directory and the beginning of the depreciation. You can transfer the Capitalization On date field when you make the first posting to the asset, without calling up the asset. In the posting dialogs, you then enter the capitalization date in the Reference Date field. We will look at this in Chapter 6. The next step is usually the tab for the time-based data (Time-Dependent tab, see Figure 3.12) eset ODDO) [ Penk Cones acne reser ope: re restr 0101 00 1125808 Co Coser me ko seoay ype rode er © Copyrht SAP AG. Al ghis eter Figure 3.12: “Time-Dependent” tab Depending on the Customizing, you have to make entries in or select numerous fields. A typical and table-supported field certainly used in ‘most companies is that of the cost center. rT In addition to the asset number, the frst name you enter is displayed or printed with virtually all evaluations. MD Therefore, make sure that you enter a meaningful text. The second line should also contribute to identifying the asset, describing the object in more detail. Therefore, avoid using changeable information.All time-based information can change. Do not underestimate the ‘organizational and maintenance effort required for this information. You must always question whether this data is up-to-date. A further tab is managed here under the term Allocations (see Figure 3.13). : 3 Sra (©Copyraht SAP AG. Al ghis reserve. Figure 3.13: “Allocations” tab Here you can define table-supported evaluation groups according to freely definable operating requirements. In this context, we recommend grouping the fixed assets technically independently of the balance sheet account and asset class, for example, a unique identification of trucks and cars. Permanent maintenance effort here is unlikely. indanele ‘Avoid redundancies with existing information such as the balance sheet account, cost center, or location. This information is already available in other places in the asset master record. An interesting assignment is the Asset Super Number field. Using a correspondingassignment table, you can group various assets under ‘one group number. For example, you could group a multiple PCs, monitors, and monitoring cameras under the group number "Monitoring system" However, also SSE think about the maintenance efor: the assignment to the group number can change constant ‘The Origin tab is available for further asset identification data (see Figure 3.14) sss NCOEODDET Pup mack on wo a Corum) @ Commyst erg ovate coe © Copytht SAP AG. Al ght eee. Figure 3.14: "Origin” tab You can enter the vendor in the form of the vendor number andlor as text; you can only enter the manufacturer as text. Both input fields require further comment. > Vendor ‘A fixed asset has a long life — the relationship to the vendor ‘sometimes does not. You can enter a vendor number here — whether this vendor will stil be in accounts payable accounting in ten years remains to be seen. This is why the name of the vendor is also saved as text. Unfortunately, the vendor name is usually not recognizable on the object, and is therefore unsuitable for identifying the object. An asset could also have many vendors — for example, a building. > Manufacturer ‘You can only enter the manufacturer as text. However, the ‘manufacturer name is more suitable for identifying the object than the vendor name. The manufacturer is generally recognizable even afterdecades from the name plates and other signs on the asset. “yore he rarufauer nae spo when you create a master record. This makes it easier to identify Me) cst cnt tagming. Eng vendre ane useful, but this is usually only important for a short Sa You can select the checkboxes Asset Purchased or Manufactured New and Purchased Used. If the asset was purchased second-hand (used), it is useful to also enter an original acquisition year and the original acquisition value in that year. ‘The Depreciation Areas tab is the most important one for SAP Asset ‘Accounting. Here you define the depreciation methods and useful lives for each depreciation area (see Figure 3.15). You also enter the data for scheduled distribution of the acquisition and production costs over a probable useful life (see Chapter 1). The accountant decides the book value used to report an object at the respective balance sheet key dates. ree (SOREN Tap com woe compote FIT Geers aocwens ree | es uct Ae Groneatnans—(oray uae Ps Coma otmee ee B28oerges) LNB o' ssuccrs no oS Figure 3.15: “Depreciation” tab You can specify depreciation methods (Dkey column) and useful lives (UseLife column) via the asset class. Making sure that the useful life corresponds to official depreciation tables saves having to provide ‘evidence in a tax audit. Whenever you create a new asset master record, ‘numerous entries can be required depending on the screen layout rule,‘Therefore, the creation of a master record can be correspondingly time- consuming. Master data information that can change over the life of an asset is particularly dificult. We will look at this in the next section. 3.7.2 Changes to the Asset Master Record ‘There is some master data information that should never change. Why should the name, manufacturer, type, serial number, or vendor of an ‘asset change? Other data can change numerous times over the life of an asset. The effort required for maintaining such changeable data is less in the data maintenance or on the screen; the skill is in getting the corresponding information in front of the screen. The higher the volume of changeable data that is queried in the asset master record, the more time-consuming and costly the associated internal reporting procedures. ‘These are factors that are often neglected when designing screen layout rules. Note that changeable information that is not maintained has no value. Less but up-to-date information is much more useful. But let us move on from the sense of the changes to the practical treatment. To change data in the asset master record, there are two different options depending on the master data field For certain fields, such as the name, manufacturer, vendor, type, and serial number, you only have to overwrite the original data, For example, if you change the name, the up-to-date name always appears in evaluations or queries (even for those for past fiscal years). Despite this, you can still trace who changed one of these master data fields and When. In Figure 3.16, our truck receives the new license plate Washington AG9225E due to a change of location in January 2012. teu "HOROSRET Tap ck Wns Eo) con Fon ‘ences cengoncuse FET Ieper | cere trance sos 9 cc ee Jecistemiacn UGH aes ater Soe sey ‘© Copytgt SAP AG. Al gh esaFigure 3.16: Change to the name In the inventory evaluation at December 31, 2012, the name is therefore correct (see Figure 3.17). Asset Balances SEF ENO BSAIGH BEEN Tse Om Asset Balances - 01 US-GAAP 1p Repor date: 31.12.2012 - Created on 10102012 fest ‘ie. Captalzed on Asset design 01017012 Pep Mk Washgon ABZIE (new) ‘© Copy SAP AG. Al gh exer Figure 3.17: Evaluation — reporting date 12/31/2012 In the inventory evaluation at December 31, 2011, the name is somewhat confusing (see Figure 3.18). At this point in time, the license plate of our truck was stil DN-ESPRESSO35. This looks different in the time-based data, Here, the problem of the confusing time-based display is avoided. ‘Asset Batances AGSEF EXO BFRIGH BEEN Eso OW Asset Balances - 01 US-GAAP [a Repor dat: 31.12.2011 Crests on: 10102012 fet ‘He |Capttzed on cet ancrgean Haodommoons GODT 2012 Pup tuck Washegun ABSZEE (nem) (Coat Ceter344 Vehicles © Copyrght SAP AG. Al ghis eeere. Figure 3.18: Evaluation — reporting date 12/31/2011 Certain data fields in the asset master record are referred to as time- based data and are generally managed on a separate tab. Typical examples of time-based data are cost centers and location information, This data Is stored in the form of time intervals. When you create a new asset, a first interval with a from date 01/01/1900 and a to date 12/31/9999 js created. You can change this data by adding a new time interval.When it was created, our truck was assigned to cost center number 3444, From 01/01/2012, it was assigned to cost center number 9898 with a second interval. Internally, the to date of the first interval is changed from 12/31/9999 to 12/31/2011. The second and currently last interval is saved with a from date of 01/01/2012 and to date of 12/31/9999. You can see these changes in Figure 3.19. (Change Asset: Overview of time intervals ssoet —__[Ranpone0008) [o Plu muck Washington A89228 (ren) Ges 3100 vonices ‘Company Code Te eas Fe cost Certer |Locton —Resp.cost. AcTip toner FL. Room oe oo —— © Copytigt SAP AG. Al gh exer. Figure 3.19: Evaluation — reporting date 12/31/2011 Here it is sufficient to specify only the from date: cost center 3444 from (01/01/1900 and cost center 9898 from 01/01/2012. The to date of the last time interval is stil unknown and is therefore recorded internally as 12/31/9999. Look at Figure 3.17 and Figure 3.18 again: both evaluations were created after the new interval was entered. In Figure 3.17, the truck is reported at 12/31/2012 as an object of cost center 9898; in Figure 3.18, at 12/31/2011 as an object of the original cost center, 3444. This is different to the procedure for changing (overwriting) the name. The name is always the up-to-date name, regardless of the time period for the evaluations. 3.7.3 Blocks and De ions In addition to changes to asset master records, blocks and deletions are also possible. Figure 3.20 shows the initial screen for blocking/deleting an asset,ese ty Crete Snare corr een Pecomccnmnesoemaoed ection SSG | Poses dtr verynanter ua rages ‘©Copyright SAP AG. Al ght eee Figure 3.20: Initial screen for block or deletion You biock an asset master record to prevent further acquisition postings to this asset. This is a procedure used primarily for assets in the area of down payments or assets under construction. You set the block itself by selecting the corresponding asset (under Asset > Block/Delote > Block, see Figure 3.20) and then saving (see Figure 3.21). The blocked asset is still available for display and evaluation. Other postings, for example, depreciation and retirements are also still possible. You can cancel the acquisition biock by selecting the None radio button in the Acquisition Lock field group at any time.(®.] Block Asset: Processing screen eset —_[neoeesoeas) © Pelap mick wacngan AEIZISE (re) Case (5100 eres camoary cate FTC ‘uray 8,008 Post teeran Frstacquston on (01-01-2012 seman © Copytht SAP AG. A ghis eer Figure 3.21: Selecting the block ‘You can only delete an asset physically under certain conditions: > There must have been no postings tothe asset > The asset number must nt be linked o any other SAP application, for example, in Materials Management for the purchase order or the goods receipt. If you use external number assignment, you could assign the asset number that has now become free when you create a new asset master record, 3.8 Asset as Account Assignment Object, In SAP Financial Accounting, account assignments and postings usually take place at the G/L account hierarchy level. The values of balance sheet or profit and loss items result from the respective account assignments. If a new vehicle intended for own use is purchased, when it is invoiced (see Figure 3.22), the following posting record would arise: Vehicles account (debit) to Payables for goods and services (credit).caruneatua) mvorce aria 12 With treet London, 12986 fngand Invoice: nearer oer /aron Delvere: oye to "oes cop 209 cas.soh se, Sute1157 "New Yr, 720022 use DeCRPTION ‘quay — [are [amouNr Pickup truck s 100,000 USD cance pte: ABC TAX 10 % 10,000 USD TOTAL: 110,000 USD Payebiewntan20daysto ‘THANK YOU FOR YOUR BUSINESS! Figure 3.22: Invoice for a truck This posting record, completely correct for regular financial accounting purposes, causes an etror message for account 21000 (Vehicles) (see Figure 3.23) in SAP Financial Accounting.(Post Documene: Header Dace seeecemet Jatt Patan Dra nierr_ fata ‘Account 7100 ncampany code ES camatbe dec pote 2 ogres ‘Sytem Reapoe (© Copyrht SAP AG. Al ghis reser Figure 3.23: Error message — Account 21000 (Vehicles) cannot be directly posted to In SAP Financial Accounting, the balance sheet account *Vehicles* (21000) is designated as reconciliation account for account type A (Asset ‘Accounting). You can only post to these accounts via an asset number in SAP Asset Accounting. SAP also uses the method of direct posting via the subledgers for asset accounting. In the same way as for SAP ‘Accounts Receivable and Accounts Payable Accounting, the application ‘must first be told which of the ledgers the entry in the Account field refers to. This is done via the posting key, in this case posting key 70 (see Figure 3.24)28 23 a a2 34 35 36 7 38 33 40 50 Bees) P._* AccTy DiC Posting key name Qo<<<<< Payment clearing Special G/L debit Invoice Reverse credit memo Other payables Incoming payment Payment difference Other clearing Payment clearing Special G/L credit Debit entry Credit entry Debit asset Credit asset Inventory taking Costs Inventory difference Price difference ©Copyright SAP AG. Al gh eeerve Figure 3.24: Selection of posting key ‘The posting key controls the entry of the line item A specific account type is assigned to each posting key: > G stands for GIL account and is assigned to the general ledger > C stands for customers and is assigned tothe accounts receivable accounting subledger > stands for vendors and is assigned to the accounts payableaccounting subledger > A stands for assets and is assigned to the asset accounting subledger Via the entry of a posting key, the application “recognizes” whether the ety in the Account field is @ G/L account number, a customer number, a vendor number, or an asset number. The posting key also defines. Whether the posting is @ debit posting or a credit posting. The amount entry in the line item is therefore assigned to the debit side (at SAP a positive value) or the credit side (at SAP a negative value) of an account, when you enter the posting key. As standard, for SAP Asset Accounting, key 70 is reserved for debits and 75 for credits. Depending on the posting dialog, you navigate to the entry of the posting key via the Complex Posting menu item or using the function key (F6). Within SAP Accounting, the asset, or more precisely, the main number and sub-number of the asset are further account assignment objects. ‘Thus, the SAP application consistently follows the prescribed hierarchy of ‘main and subledger. The posting record for this asset acquisition in an integrated SAP Financial Accounting is therefore: ‘Truck asset 400000000004 -0 (debit) to Payables for goods and services (credit) Thus, you can only post to andior change the balance of a balance sheet account assigned to SAP Asset Accounting (account type A) via an asset. In Figure 3.25, the asset number is used in the Account field and, separated by a dash, sub-number 0. Due to the predefined posting key 70, the SAP application “recognizes” thatthe entry in the Account fied is an asset number.Enter Vendor invoice: Add Vendor item SG BD Grew —recrmose: Gran0sacrey tees vrs z corte as) kee [16708 en ST Cucina Tacos Pontes Oercet 1 1 Pree ce Pretend Poymer Pree art Tet @ testes Paaly70Aecare “eo0000000004-0 Sok!‘ Tye 100" Neweoeate Jj! Figure 3.25: Posting key 70 with asset number and sub-number as account As the asset is assigned to a balance sheet account via the asset class and its account determination, the SAP system determines the account assignment for Financial Accounting. From the entry of asset number 400000000004 -0, the SAP system only creates a debit posting to account 11000. Figure 3.26 shows account number 21000 as the G/L ‘account in posting line 002, and to the right of that, asset number 400000000004 with the sub-number 0 (in this display, with leading zeros), Enter Vendor invoice: Display Overview S801 cureey Bam eee PosmpOxe (O02 2012 Pes 2 (0. Renae ay cor 31 oonon00n21 car Lanited (Lea) 110.000,00- —40,000,00. 11Figure 3.26: Overview of the posting ‘The account assignment and postings take place via the asset number. This results in the posting record that we had at the beginning, Vehicles to Payables. For every traditional accountant, this is a reassuring fact. ‘The posting key also controls which fields the input screens contain. In Chapter 4, "Business Processes and Posting Transactions,” you will get to know this type of posting— with the asset number instead of the ‘account number—and the other input fields more closely in numerous examples, 3.9 Summary In this chapter we have presented the asset in the balance sheet hierarchy. You have become familar with the control function of the asset classes and the options for setting up the asset master sheet. We have discussed creating, changing, and deleting the asset master record. And you now know that in SAP, the asset number is used for account ‘assignment. In the next chapter we will also look at the task of account assignment — and above all, the question of when you can create the asset master record in the intemal process.4 Business Processes and Posting Transactions “There are many ways to achieve a goal.” Staying true to this motto, in this chapter we will present various SAP transactions for ‘everyday business transactions or postings. Within a company, the asset accountant talks to and corresponds with people from many different departments, gathering the information that he needs. This cross-organizational fact is reflected as a division of work in many SAP transactions that you will become familiar with later in examples, particularly for acquisition postings. With no claim to completeness, the following are important departments with points of contact with asset accounting: > Accounts payable accounting Accounts receivable accounting P Vehicle fleet Insurance management In this chapter, we will present the resulting SAP Asset Accounting postings using practice-related business transactions. You will become familiar with the various SAP transactions and will then be able to use them in your daily work. Our objective is also to show an overview of different alternative transactions for one business transaction, with the corresponding advantages and disadvantages. We will address five main topics: P Acquisition > Transter posting P Retirement > Transfer > Write-up We will present different variants of the individual SAP transactions and business transactions. For example, you can post acquisitions via a clearing account, integrated with Accounts Payable Accounting, or even integrated with Materials Management. In addition to the incominginvoice, complete or partial credit memos are important. We will also consider individual aspects such as amount rounding or subsequent acquisitions in the same fiscal year. Highlighted tips and error messages created deliberately should help you to master every individual business transaction. 4.1 Acquisition You create the balance sheet at the end of the fiscal year, and at this point in time at the latest, you have to define and value the new objects added to fixed assets. Traditionally therefore, asset accounting wasiis oriented on financial statements. Usually, for assets acquired during the year, the assumed acquisition and production costs were posted to the ‘asset accounts in financial accounting or to clearing accounts. Therefore, there was no movement in asset accounting itself. The only benefit of this isa time-saving. ‘As a result, around the end of the fiscal year there was always a flurry of ‘activity in accounting departments. The information mentioned above has to be obtained; at some point in the fiscal year, the clearing accounts (e.g., for acquisition postings) have to be credited. This means that every transaction has to be processed again, every document looked at again and posted. This procedure not only causes unnecessary personnel costs: the willingness of the accounting department to provide information is limited for clearing postings during the year. As a result of the postings to clearing accounts during the fiscal year, the balance sheet and profit and loss statement are not very informative. This procedure also makes the verification or proof of acquisition and production costs more difficult. All of the information mentioned above has to be queried, All documents have to be looked at again. Considering the disadvantages of traditional asset accounting, which relied heavily on clearing accounts, it is clear why there are multiple transactions for the same content (acquisition or retirement) in the SAP system. In SAP Asset Accounting, you can post and document acquisition postings with three different methods. Figure 4.1 shows an overview of the methods with the respective degree of integration.vendor lewting account net oT ® vendor set a Figure 4.1: Overview 4.1.1 Posting using clearing accounts In the first method, posting using a clearing account, the SAP Accounts Payable Accounting and Asset Accounting modules are managed separately. There are usually different people involved who are concered exclusively with their own area of work. The accounts payable accountant activates the posting record— Clearing account to Vendor— passing the invoice on to the asset accounting department. There, the transaction is completed in the system with the posting Asset fo Clearing account. The clearing account used by both departments has to be reconciled at the end of the month, This is an additional work step, a potential source of error, and a considerable disadvantage of this method. 4.1.2 Integration with FILAP If the SAP Asset Accounting and Accounts Payable Accounting modules are not strictly separated, one posting record—Asset fo Vendor—can be used. In this second method, the division of work consists of the asset accountant creating the asset master record in the SAP system based on the invoice and noting the master data number on the invoice. Theaccounts payable accountant then documents the business transaction completely in the system. If the asset accountant and accounts payable ‘accountant are one person, this method is preferred anyway. 4.1.3 Integration with MM In the third method, available technically from SAP Release 4.6, there is an initial account assignment based on the purchase order data. At this very early stage, the asset master record is generated in the ERP module MM and defined in the purchase order as information. In practice, this integrated variant has the most advantages for documentation of the business process. To find out which of the three methods are used most in practice, the Internet platform www-fico-forum.com launched a survey in June 2010. More than 100 users participated in the survey. The result showed a trend towards the highest possible integration with Materials Management (41%). Integration with FI-AP recorded 30% of the votes, and posting using clearing accounts 29% of the votes. The survey results can also be interpreted to mean that each of the three acquisition posting methods is used with similar frequency, and that each method is justifiable in a company. In addition to this overview, in the next sections we will present all three acquisition posting methods in more detail using an example. This will make the advantages and disadvantages of each method transparent and tangible. 4.1.4 Posting via a Clearing Account This procedure is still available in integrated SAP Asset Accounting. Here too, you can park assumed asset acquisitions in clearing accounts in ‘SAP Financial Accounting to post them to the assets at a later point in time. For this "traditional" procedure, SAP Asset Accounting offers special functions, Ifthe SAP Accounts Payable Accounting and Asset Accounting modules are separate, a posting method via clearing account can/must be used. In a first step, the vendor invoice is available; it is processed with transaction FB6O (Enter Incoming Invoices) and posting record Clearing ‘account to Vendor (see Figure 4.2).i =e ———— ads : ea Greene a © Copyrht SAP AG. Al ghis reson Figure 4.2: Posting record — Clearing account to Vendor ‘The accounts payable accountant does not need any specific knowledge about SAP Asset Accounting and can define the payable in the system and schedule it for payment. The SAP posting is usually noted on the paper document and this is passed on to the asset accountant. In a second, independent step, the asset accountant can create the asset master record in the correct asset class and complete the business transaction. Figure 4.3 shows transaction ABZON (Acquisition with ‘Automatic Offsetting Entry) with an example in which an asset, "Computer," is created in asset class 3200 and at the same time, there is ‘a posting in the amount of USD 10,000.00 to the clearing account.Enter Asset Transaction: Acquis. wiAutom. Offsetting Entry FE cptvetams enue conpamcece eaves 6 @ comveyene FT — sao gi) onc “corr carne a0 — Te __— ‘© Copytght SAP AG. Al gh eearve. Figure 4.3: Posting record — Asset to Clearing account Two main points are dependent on the knowledge of the asset accountant: P Selection of the correct asset class ensures the correct useful lfe for the computer. > irrespective ofthe posting date and document date, itis important to know the point in time from which the asset was available to the company. This produces the reference date and thus the depreciation star. Using transaction AWOTN (Asset Explorer), you can display all relevant ‘and linked data in an overview (see Figure 4.4). Here, a disadvantage of this acquisition posting method becomes clear: only a few items of integrated information are available in the bottom left area, Objects related to asset. Due to the posting method, data from the purchase order ‘or SAP Accounts Payable Accounting is missing.el amuses mere Scena © copyraht SAP AG. Al ghis reserve Figure 4.4: Asset Explorer including linked objects ‘A further disadvantage of this acquisition posting method is that you have to clear the open items in the clearing account in an additional work step. Figure 4.5 shows a simple case with USD 10,000.00, document type KR, ‘and an identical amount with document type AA. If open items cannot be cleared automatically, you have to process them manually. Depending on the volume of documents, the clearing account becomes unclear and incorrect postings are common in practice. This major disadvantage is reason enough to think about integrated acquisition postings. GoogleClear GA. Account Process open Items 2D Onemar cmeotan Gecmones | Aces mm se cin cra eon Cocoa. Coumart. Coca PasngKey FotrgD. | UeDGre. t} Figure 4.5: Clearing open items © copyrht SAP AG. Al ghiseeere 4.1.5 Posting Integrated with SAP Accounts Payable Accounting You can post vendor invoices easily and clearly with the single-screen transaction FB60; however, an integrated posting with SAP Asset ‘Accounting is not yet possible. Instead you have to use transaction FBO1 (Post Document) — available since the days of R/2. To post a complete document, you must have already created an asset master record. The accounts payable accountant also determines when depreciation should begin. In the first step, you enter the data for the document header. Figure 4.6 shows that, in addition to the invoice date (document date), you define a document type for vendor postings (KR), the date for the period in financial accounting (posting date), and a reference to the external invoice number (reference). Post Document: Header Data lscccimare Scie! EFC ty (Postmenreerence PEstag Opens ee coromycme 6100 Poe Coney usb Figure 4.6: Enter document headerIf you select the vendor using posting key 31 (Credit Vendor Posting), when you press ENTER, the first line item appears as shown in Figure 4.7. The gross amount of USD 11,000.00 contains an example tax portion of 10%. The payment target is defined as four days for a net Payment. For integration with SAP Asset Accounting, you need a suitable posting key, in this case, 70. The input help (F4) offers a corresponding selection of existing asset numbers. If you work with the F4 input help and search for your asset master record using the name, note a special feature in SAP Asset Accounting. In the asset master record there are two lines for defining the name — ‘enabling you to describe the asset in detail. However, in the context of the posting transaction, the search function is limited to the first line. ss Enter Vendor invoice: Add Vendor item SO DD Preven sccmecs Gfor0s cay Bee Vente Beatie) 3 Cop om /inaee/ 31 Cate Tucote Pap Tes Dapsecet : 1 Decne Oe, rot Pomectes Pee soe = tna) PasiyTO'Aceurt 400000000006°0° “SOLind “Type 100" Newcocase Jp © copytght SAP AG. Al ghis eee. Figure 4.7: First line item with preparation for FI-AA ‘Asset master record 400000000006 was selected. Transaction type 100 for acquisition postings assigns the posting within the asset history sheet. Press ENTER to go to the second line item (Figure 4.8). Information about the business area and the profit center is taken from the asset‘master record and you cannot change it here. The reference date 04/26 indicates the depreciation start Enter Vendor Invoice: Add Asset item BOBO Piers Accmosd Grsaoxseey Hoes caicont TT Fear tangs Campevene Festa Tansee TH rosie “TaROOREGR T— Corot? tay 20st at TE e180 aes : 0 see BiROSRRRI) comme? aww HOE Accounting > Valuation > Amount Specifications (Company Code/Depreciation Area) > Specify Rounding of Net Book Value and/or Depreciation (transaction OAYO). Figure 4.21 shows a transaction that focuses on cent amounts and the second asset, an office chair.corumned tad) vorce ahh saat Landon, 12386 ngand mwolce arse s6/oa2012 Purchase Order Oste: 31/07/2012 DelweryOwe: 34/8/2012 1065 cow 203s sth st, Sue 1157 ‘ew Yr, WF 10022 ua ‘DESCRIPTION ‘uae [Rare [awouer Desk 2 ‘899.99 USD Office chair 100.01 USD TAX 10% 100 USD TOTAL: — 1,100USD Pape win 20 daysto own ec ‘THANK YOU FOR YOUR BUSINESS! Figure 4.21: Business transaction ‘A gross amount of USD 1,100.00 is payable net within 30 days. The delivery encompasses a desk and an office chair. At USD 899.99, the desk belongs to the asset class Fixtures and fittings, see Figure 4.22. In contrast, the office chair is a low-value asset and is to be written off ‘completely in the year of acquisitionEnter Vendor invoice: Correct Asset Item BERD Sroess Aeamose LGrssioao ey Htoes tccnet FRE Fotaes nttange _ Cconganycuse FIED ‘oescop Tanete T pre 00.08 U0 ss E : — = es @ uote) ‘© Copytgt SAP AG. Al gh exer Figure 4.22: Asset item — desk ‘Once the invoice has been posted, it is worth taking a look at the Asset Explorer. Figure 4.23 shows the desk with acquisition costs of USD £899.99 in the first year. The depreciation in the first year is USD 75.99, ‘meaning that in the subsequent years, round depreciation amounts and net book values can be calculated,Fo Company Case 1065 cop ase connonacea02) [0 —‘ploese reaee = Q2RD) » Oanl Paneedvoes | Posed aves Parte eG ee EL) eJ8)8 Ds) B) US-GAAP:2012 -2017 Ficalyear £APC raneacions Acquston vale #Ordnary degree. Netbook value rey ao 30 “ona em oan 90 exo Us0. ey 0 wom baago USD L feoa0 moo se400 Uso ae fea0 moo eto Uso ms eas imo toto Uso a oa foie. so Figure 4.23: Asset Explorer — desk ‘An asset is not always acquired with one invoice alone. In practice, there are offen multiple invoices for one asset. The next business transaction looks at an example of this. 4.1.9 Additional Acquisition in the Same Fiscal Year In this example, the truck asset was acquired a few months ago at a total value of USD 80,000.00. In the same fiscal year, all trucks are to be fitted with modern navigation devices at USD 2,000.00 each. An additional installation kit is also required, at a cost of USD 500.00. For an additional ‘acquisition in the same fiscal year, you can use transaction type 100. Our company, Car Limited (Ltd.), upgrades two trucks and issues the following invoice (see Figure 4.24).corumted ad) snvotee i2hersvee london a2 98¢ fogs wwocesn® ——e2nonoi2 chase Ore Date 940772012 DeweyOute 0407012 oes cow 203 ot ht, Sate 1157 fw or wr 022 BeeRRTON aR — eae — ToT 2 navigation systems including assembly Navigation system 2 4,000 USD Installation kit 2 1,000 USD TAX10% 500_USD, TOTAL: 5,500USD ape win 20 date THANK YOU FOR YOUR BUSINESS! Figure 4.24: Business transaction ‘The vendor item in Figure 4.25 shows the total gross amount of USD 5,500.00 and the tax item of USD 500.00. The descriptive document text for the asset transactions is helpful for subsequent traceability of the business transaction,(adie Mordor brvooee Correet Vn OT EGBG Pvcessr —secrmate Effet Oaa ny oar FA] corumea as) curee [61000] Company Cage ICD] oes cep en 1/8/21 Pap Teme Ooppercet (Ts 1 Beda — G2-10-2077) eas T Dec bare ee araut Poymer Pe sree a assert Tet 2 napiton stems eadrg tbe © conyight SAP AG. A gh eeered. Figure 4.25: Vendor item Both the navigation system in Figure 4.26 and the installation kit in Figure 4.27 are posted to separate assets. At this point, we would advise against the use of the asset sub-number again. With a sub-number, there is a risk that it will be forgotten in cost center changes or retirements of the main number. |e Menton eemiee: ett A 0 GBD Precedns —scctmotes GHFast ata Emry Qtcon FT] Pees Comoe FE) escor tees (5D Aan FTO ee rk ven Ho (ten 20 Een 1 ee aces om scot = om © Copyrht SAP AG. Al ighis esere. Figure 4.26: Navigation system GoogleEnter Vendor Involce: Add Asset item BARD Proves —secinest Fas 0waEny Bees Guten FT Paes ate Coneanycade ‘FICO ‘OES coo Tans te TH poset "oRDOROEOOES Php eek Wason A725 (ne 1 Dee see TO Eso set eg 100 aceose 7 est “HGGOGGOOEOSTO—] Pep eek Waren ABZ ( Relres Owe 070 Se) sscinmert Tea anon imme) (© Copyrght SAP AG. Al ghis reser Figure 4.27: Installation kit Figure 4.28 shows the truck purchase in January and the upgrade in October. Figure 4.28: Asset transactions ‘There is no change to the existing linear depreciation of the truck over five years, However, the additional acquisition results in a new depreciation base in SAP Asset Accounting. Previously, USD 80,000.00 split over five years resulted in an annual depreciation of USD 16,000.00 — broken down by month, USD 1,334.00 per month, You can see this value for months 1 to 9 in Figure 4.29. Our additional acquisition results in a new depreciation base of USD 82,500.00. Split over five years, this is an annual depreciation of USD16,500.00 — broken down by month, USD 1,375.00 per month. You can see this new depreciation value for months 11 and 12 in Figure 4.29. company Cote FICO woes cup pase "400000000008" 0” Papen Washing B22 (ew) roa OAD) Pareedvate, Poranatrs Fi. ocaa Oe Depreciation posted/planned Sons Ste Par Ok den. fii ep Resenes eet Rea icy lo Paes ames. 11308000000 Om 000 USO la Pwes Pues 2130000) aoD MD USD lames P| 313000000) MD USD la Pawes—Pames 4 130m OOOO 000m USD la Pwes Paes § 13000) aOD Om” USD 0 Paes ames 61335000000 Omm 000 Us0 la wes Ps 71300 OpD On) —a0D Om” USD la ames Paes 81300020) O00 8m UD lo awed Pied 8120000060060 000 090 USD lo Pawes Pumas 1 1375007 060 Of) 000 Om USD lo owes Pies 2137502 0p0op0 000 m0 Usd ‘© Copytgt SAP AG. Al gh esa Figure 4.29: Monthly values in the Asset Explorer ‘The month of the additional acquisition is a special situation. In period 10, the depreciation forthe navigation system and the installation kit up to the prior acquisition of the truck in period 1 is made up. If we take the difference between the old depreciation (USD 1,334.00) and the new depreciation (USD 1,375.00) and multiply this by 9 (periods 1 to 9), the amount is USD 369.00. Add this depreciation to be made up to the new depreciation amount (plus some rounding differences), and this explains the monthly value of USD 1,750.00 for period 10 shown in Figure 4.29. 4.1.10 Credit Memo If an invoice is subsequently corrected by means of a credit memo (for ‘example, due to notification of defects), you must also take this business transaction into account in SAP Asset Accounting. To take it step-by- step, in the following example, the invoice is available first and in a second step, has to be corrected by means of a credit memo. Both complete and partial credit memo variants are shown. Figure 4.30 shows an acquisition with the original invoice for five height-adjustable desks, for which transport costs are also due.corumnestud) mevonce ramighsteet tendon 42586 ngand Invorceane ——oxfojzon2 Purchase rderate: 21/07/2012 Delveryone —o1//z012 oes cop 2m Ean sa st, sates? New vor” 10022 usa DescRiPTION ‘aoanny — [ware [aon height-adjustable desk 5 5,000 USD cost of freight 35 250 USD TAX 10 % 525_USD_ TOTAL: 5,775 USD Paya watrin204aysto an ac ‘THANK YOU FOR YOUR BUSINESS! Figure 4.30: Business transaction In the SAP posting document, the vendor line item covers the total gross. amount of USD 5,775.00 and the tax with USD 525.00 (10% of a net basis of USD 5,250.00, see Figure 4.31).Enter Vendor Invoice: Correct Vendor Item BERD Press reams LGrstons ey eer mr corumaee ty ote T6565 — ConeanyCase FIED! past ——_8.776,00 s0 Payee Dajooncent , 1 ee ase ee. srt Tee ‘a abe Sak es ea HORE Co] (© Copyraht SAP AG. Al ghis oso. Figure 4.31: Original invoice — vendor line item ‘The desks, which each represent one asset master record, are covered in five individual line items. The reference date 10/01 is identical to the delivery date (see Figure 4.32). Enter Vendor invoice: Add Asset Item BOQD Sucre —recrnos Granomaciny Eltees tense Fae tts Cconponycese ‘FICO ‘ces com "00005000076 0 mr tutte ea vi 1050 ws Ort ngsub deck WSS eer (wee) Theater coneriege Dang ts) (© Copyrht SAP AG. A ghis reserve. Figure 4.32: Original invoice — asset item In the document overview in Figure 4.33, you can clearly see the assetmaster records 400000000014 to 400000000018. Each of the individual height-adjustable desks is valued with acquisition costs of USD 1,050.00: that is, a unit price of USD 1,000.00 plus USD 50.00 transport costs. Enter Vendor invoice: Display Overview GB korroycureny Bites reset Documereone (62-70-2012) Tye (RR) ConporyCade FIED) Posie (50-10-2012) Penod (10) Carey oso ewes a7? se Docent “soa pat TacRegot ne (350.2027 sn oer cue (0131000000002 Car Lietted (Ltd) 5.776,00 25,00. 11 foe 700600021000 soo002000014 coco 1 080,00 8 fom 790000021000 4000000015 oo00 +.080,00 a (08 790600021000 00002000018 co00 1.080.090 a © copyrght SAP AG. Al ghis eee Figure 4.33: Original invoice — document overview ‘The assumption is a useful life of five years for each desk. USD 210.00 annual depreciation, pro rata for three months at USD 53.00, results in the asset history sheet illustrated in Figure 4.34 for each desk. ‘Asset stay show (© Copyraht SAP AG. Al ghis reserve Figure 4.34: Asset history sheets After the acquisition has been processed, damage or defects are found ‘on two desks. We will use these two examples to show the business transactions for a complete and a partial credit memo. Fortunately, the first case is discovered quickly, with the result that the vendor takes the Googkdesk back completely. A full credit memo is received. 4.1.11 Complete credit memo To enable a subsequent correction of the invoice, both business partners agree on a credit memo. Figure 4.35 shows that the credit memo covers the transport costs as well as the purchase price. Therefore, it is a ‘complete credit memo. corvmtes ud) case meme tgs de, AL? 380 Engord rede Meno: oxaz012 Purchate Orde Date 310772012 Oeiveryone: ——oxto7z012 loEscam 209 Ea som, Suite 3857 ew Yor, 10622 us escaTION, ‘quai — [ear Tanwoun height-adjustable desk 1 1,000 USD _ Costof freight a, 50 USD TAX 10% 105_USD 1,155 USD_ Payble wth 30 dose ‘THANK YOU FOR YOUR BUSINESS! Figure 4.35: Business transaction Figure 4.36 shows that the SAP document header is different to that of an invoice. Many companies use a separate document type with a separatenumber range for credit memos. In the example, the invoice document is posted with standard document type KR and the credit memo document with KG. In contrast to the invoice, which has a posting date for period 10, the credit memo is not posted until period 11. This will be clearer later in the monthly depreciation. In addition to the details already described, note the changed posting key 21 for a debit vendor line item. Post Document: Header Data iddeamert Actos EffestOumErey (foswenreeece J eserg Ons Poon Gh a02) Pend 1) Carney Posy Aces [27 sams (Thre fa Figure 4.36: Credit memo — document header In the vendor line item, a gross amount of USD 1,155.00, which contains USD 105.00 tax, is entered (see Figure 4.37). For the credit memo to be reported correctly in SAP Asset Accounting, posting key 75 for the credit line item is used there. A negative acquisition is also noted for the asset history sheet. Transaction type 100 is used accordingly.Enter Vendor credit memo: Correct Vendor item BORD Pures secrmete Gretossemy Bees eee cot) cane i0— a a Amount is cokstated ene iv “ The GRRRT RSD Napa on Ting Soak) ay TE ecaot THOGHOOTED ne —Thpe TOO newencear "Tp" © copytght SAP AG. Al ghts eee Figure 4.37: Credit memo — vendor line iter As the defect was discovered on delivery, the reference date of the invoice and the credit memo are identical (see Figure 4.38). Enter Vendor credit memo: Add Asset Item BGQO Pica ramos Rirenomcny ross cusccnmt FOR aes ants _ Conganycude FICO oescep Tansee T20 asset O0DRRODETT Oneal desk 2 rs eet 75 an an 99/100 ret 1080. uso eset "BROOROOTETO) ere agus ask oie) © copytght SAP AG. Al ghts eee Figure 4.38: Credit memo — asset item‘The document overview in Figure 4.39 shows the complete business transaction of a credit memo. Note again that the invoice has a posting date for period 10, and the credit memo a posting date for period 11 Enter Vendor credit memo: Display Overview GB B0s01ycureny Bites Oreste Pong Our OL TT2O2 Peed tH) Caney eo COnsanenNanber TNTERUL | Facuvex (2012) TaraanOaw (01-14 297 TacRepen One 9-71-2072 ome nssosrertcurecy 01 210000000021 car Limited (LE) 1.195,00 405,00. 11 Figure 4.39: Credit memo — document overview In addition to the SAP General Ledger and Accounts Payable Accounting views, the view of the SAP Asset Accounting subledger is also interesting. In the Asset Explorer in Figure 4.40, you can see both positive and negative acquisition postings with transaction type 100 in the lower area, The acquisition value and net book value balance.Company Code (FICO! DES Cop Asset [400000000014 ‘O eighe-adustable desk recy = (RD) eam Planned values US-GAAP _Fiscalyear start Change Yesr-end Cry [APC transactions USO, Uso Sy ae) ‘Transactions ‘AsstVal date | Amount TType Transacton ypename Crey’ (01.10.2012 100 Extemal asset acquisition USD 100 Eternal asset acqustion USD (© Copygh SAPAG, A igs reserve. Figure 4.40: Asset Explorer after complete credit memo The monthly values in the Asset Explorer in Figure 4.41 show the different periods of the invoice (period 10) and the credit memo (period 11). The planned depreciation in period 10 is already canceled completely in period 11. GoogleDepreciation postedplanned ‘Saus Skuse tnd dept Up dep. Reseves terest #Revabt Cy Pome Pres ogo ogo 0p0 og O00 sD Pomed Pres gogo 060 og Om0 sD Pomed Pres go 0g 090 0g Opn sD Pred Phares go 0g0 090 0n0 Opn sD Paes Phrnes 1000000090090 O40. Uso a0 m0 000 Uso © copyant SAP AG. Alaghis rsened. Figure 4.41: Asset Explorer monthly values The asset history sheet related to the fiscal year also shows a balance of 0.00 in the columns Acquisition and Dep. for Year after the complete credit memo (see Figure 4.42). (©Copyright SAP AG. Aghie eteres. Figure 4.42: Asset history sheet after complete credit memo Figure 4.43 shows the asset transactions including the complete history. ‘Thanks to descriptive item texts in the invoice and credit memo, the business transaction is also clear and transparently traceable in the overview. Google‘Asset Transactlons naavy EN ao Deere Om samen © Copyrht SAP AG. Alghero Figure 4.43: Overview of asset transactions This is how a complete credit memo is portrayed in the SAP system. Our detailed presentation, including screenshots, enables a comparison with the partial credit memo and helps you to work out the differences between the two procedures, 4.1.12 Partial credit memo ‘Some months later, defects are detected on the second desk. Here too, the business partners agree on a credit memo. In contrast to the first case, the freight charges are not included. The business transaction in Figure 4.44 is therefore a partial credit memo. ‘A separate document type KG and the posting key for vendor debit line items 21 are also used for the partial credit memo. Figure 4.45 shows just ‘one difference to the previous business transaction — posting period 12 selected. We will look at the period from the invoice creation to the credit ‘memo creation in more detail in the subledger later in this example.or united (a) crecniame 2magh sree. Lando, a12 386 Engand ean Meno: ——oxsianoi2 Purchase Order Oat 31/07/2012 Delvery Date 03/1072012 w oes xp 20 Est Sh, Sate 1187 New Yok NY 10822 ‘ orscnorion ‘quarry — [ware [awounr height-adjustable desk 1 1,000USD_ TAX 10% 100 USD TOTAL — 1,100USD Payable mtn 3040712 ow ec ‘THANK YOU FOR YOUR BUSINESS! Figure 4.44: Business transaction GooglePost Document: Header Data tdconmer Aectmead GffotOwceey ype ndeerce Pesan cxers Peergoae—(6CES| Pd 4 commapran fa cae Tien isons he fo © copyrght SAP AG. Al ghis recone Figure 4.45: Credit memo — document header With the freight charges ignored, the gross amount reduces to USD 1,100.00 (see Figure 4.46). In the document text, it is important to describe the business transaction as precisely as possible again. Posting key 75 is used for a credit asset item, and transaction type 100 for the negative acquisition, Enter Vendor credit memo: Correct Vendor Item ZQBO Pied seams EifstOssémy Bross ese Fe corurnes ts) cusce Tie Coneanecese FISD IeeSCop Petes Doerr 1 ’ Tea (CREOTIGO Rea ieee) Pray 75 Pecomt “GICOOOOOOTEO Sung The TOD. nweneate Jp © Copytght SAP AG. Al ght eee Figure 4.46: Credit memo — vendor line item ‘As some months have passed between the delivery of the desk and thediscovery of the defect, the reference date 12/01 refers to the retum date. Figure 4.47 shows this situation, Enter Vendor credit memo: Correct Asset Item BORO Pera rexnoss Brstowcey Hees Feats wating — Cconeanycase ‘FICO ‘Des co Testo TT asset -oRRDRRORTTE'S— neeaustle desk Co a) rt Center = est “uoTGOGOTTETO] eer agusave sk esse Tee EO he desk Oars) © Copyrsht SAP AG. Al ghis reserve Figure 4.47: Credit memo — asset item ‘The document overview in Figure 4.48 shows that in addition tothe later posting date, there is a reduced gross amount (excluding freight) for the Partial credit memo in contrast to the original invoice. Enter Vendor credit memo: Display Overview 80 “Postings” > "Ast Ret. by seraping” a © Copytght SAP AG. At ght exer Figure 4.75: Error message, posting key and transaction type ‘The error message states that an asset retirement with revenue must first be assigned to a revenue account. The SAP system then uses posting key 75 and the transaction type internally to write off balance values (in ‘our case, USD 1,050.00) on the asset accounts. Figure 4.76 shows the correct next line’ item. The net revenue is to be posted to revenue account 825000 with G/L accounting posting key 50 (Credit Posting). If the account has been configured correctly, on the following screen you can select the asset. In this example, the field status group of the revenue account permits an asset retirement. To open an additional input window, select the asset retirement checkmark. In Figure 4.77, you can see that the height- adjustable desk is completely retired at 02/28.Enter Customer Involce: Correct Customer item 2G] Press scenes Kfratounsney toes usenet RST eter costg ence DoT Petes Dapper 1 1 Brebve 2602200) ee arose Payee Prt ae Pynet et (©Copyraht SAP AG. A ghis reser Figure 4.76: Asset retirement — G/L. account line item (correct)Enter Customer invoice: Add G/L account item BERD Prrecns secrete fox0ueey ows ComganyCofe FIC) OES Cop en 2c ty /50 Bienes ‘roo paBa Cost Cee nae pect oannn0000%8) Posing ets <= Percerage rae cunesy © Copytght SAP AG. Al gh eee Figure 4.77: Asset retirement as complete retirement In order to understand the resulting posting document exactly, it is important to consider the previous valuation at net book value and net revenue (see Figure 4.78). The height-adjustable desk was acquired in 2012 for USD 1,050.00, and, with a useful life of five years, gives rise toa ‘monthly depreciation amount of USD 17.50 (= USD 1,050.00 / 5 years / 12 months). The wear and fallin value are reflected in postings affecting the profit and loss statement from March to December in 2012. A total amount of USD 175.00 (= USD 17.50 x 10 months) is not posted against the balance sheet account in the indirect depreciation method used here, but against the value adjustment account. Depreciation from 2013 of USD 35.00 is treated in the same way as this posting method. Thus, the original acquisition costs remain on the balance sheet account.Bs 121000 21010 helghtadlustable desk value agustment 1.050 175435 =20 P&L Monthly depreciation 2012 ‘Monthly depreciation 2013 03.2012 -1750 012013 - 1750 04 2012 - 171 22013-1750 05.2012 - 1750 — 06.2012 - 1750 35 (072012 - 1750 102012 - 1750 112012 - 1750 122012 - 1750 175 Figure 4.76 Previous valuation base ‘The net book value for the desk is USD 840.00 (= USD 1,050.00 - USD 210.00). For an asset retirement with a net revenue of USD 900.00, there is a profit of USD 60.00. The balance and the value adjustment account are also cleaned up (see Figure 4.79).Bs 1175000 21000 21010 TAX, value ajunament nelgreagustabie desk auras » 100 |[so@] [ao J] 210 ora Recenable asa PBL isposal/sale fed assets [= a rots 25000 or disposalsale fixed assets +900 (1050-210) Figure 4.79 Asset retirement with profit Figure 4.80 shows how this is then finally portrayed in the SAP system. ‘You have only selected two G/L account line items manually — the other four have been generated automatically. Four automatically generated line items with G/L account and posting amounts selected by the SAP system show clearly why the account determination in Customizing is so important in SAP Asset Accounting, (8) Display Document: Data Entry View PEED ss020/cweny Cometic vew ay Yew scuner sree [OCO0G000 —CanpanyCate FIG. ecaew 20D Docunen Ose 25.02 201) PeaigOwe (01.05. 2013| Pens 5 ‘corre, = esc SP SVMF Hus eae Me OD igor za oreng toi Ws0 00 70 kaso pre = ef0 ‘em: UD 470 200 ‘o0000002015 0000 ‘80 USD 540 smo Suspense st -asro so so © copyrght SAP AG. A ghis eeeFigure 4.80: Document overview ‘The first asset retirement variant, integrated with SAP Accounts Receivable Accounting and SAP Asset Accounting, is useful if one person in your company can enter and post the entire document. In practice, larger companies in particular have a division of work between the accounts receivable accounting and asset accounting departments — this requires an altemative procedure and therefore a different transaction. 4.3.2 Sale against Clearing Account For business transactions such as cash sales, an exchange, an insurance claim, or even for a vendor credit memo, you have to post an asset retirement without a customer. You can do this using SAP transaction ABAON. In this example, again we are retiring one of the height-adjustable desks for USD 900.00 (net). Figure 4.81 shows the transaction and makes the retirement date (= reference date) 02/28 transparent. Enter Asset Transaction: Asset Sale Without Customer FEE Spine tems §4change company cose futnie asses BD Company Code [FIC IES cop Asset 1490000000016) [0 _|height-adjustable desk ‘Addionl deals _| Pat etrerent Document Date 2802 2013] Psteg Date (01.08.2013) Assetvaue date 28.02.2013 Tet Sale ‘Specfestinsforrevenue Manual Revenue 900,00 ev fom rp ©Copyright SAP AG. At ght eee Figure 4.81: Retirement via sale without customer Using the Simulate icon, you can simulate the document before posting it (see Figure 4.82). Again, the balance sheet accounts with the historical acquisition costs (USD 1,050.00) and the value adjustment account withthe cumulative depreciation (USD 88.00) are initially set to a cumulative balance of 0.00. With a net book value of USD 962.00 and net revenue of USD 900.00, there is a loss of USD 62.00. The net revenue is “parked” in clearing account 825000 as a credit until, for example, the accounts receivable accounting department can perform a posting, Customer to Revenue (debit) in a next individual step. In contrast to the integrated posting, this variant is more prone to errors and more time-consuming, Enter Asset Transaction: Asset Sale Without Customer Ay SAREE MEME Brose Rsove Pecdtora accu assent Document Header Info ‘Document Ost: 22022013 Document Type: AA Company Code: FICO Posting Oat O102013 Perio of Facnvesn S018 Line items. [ig% zoom atogommore ono 10800" USD “Pm row —__stoonmnos e000 800 USD 249 suo —_—_Suepeoe a= epo com. usb samo tases 200 USD, © Copytght SAP AG. A ght eeerve Figure 4.82: Simulate document Figure 4.83 shows the result in the Asset Explorer. At the beginning of the year, a net book value of USD 1,050.00 was determined for the desk. ‘A retirement at 02/28 allows two depreciation postings of USD 17.50 each in January and February ofthe current year (USD 35.00 in total). In another illustration, the asset history sheet in Figure 4.84 initially shows {in the first columin) the historical acquisition and production and the depreciation from the previous year (USD 53.00). It also shows the resulting book value (997.00-35,00 = 962.00). The last column on the Tight, the current acquisition and production costs, shows the current acquisition and production costs after the asset retirement and the current book value at USD 0.00.company Coue (FICO) ‘oes co pect 00000000076) [9] regreasusebe deck Fact (208) Planned values US-GAAP. ve {fectyersat urge Yee Cy [apCisacions | 108000. 105000. (Oe) Ga) eee. io ‘Transactions {sstsae Art Thee Treen pera. Or 10 eos Cy i Re ee © copyrght SAP AG. A ghisreeered. Figure 4.83: Overview in the Asset Explorer ‘Asset sary Seat HOrnaaey BN O3m Beem Geen OK een © Copyight SAP AG. A gh exer. Figure 4.84: Asset history sheet All values previously displayed originated from depreciation area 01, which in this example represents the US GAAP accounting regulations, Now that you have seen two variants of the business transaction asset retirement with revenue, in the next section we will look at the situation Googlefor a retirement without revenue. 4.3.3 Retirement without Revenue ‘An asset sale is not the only cause for an asset leaving fixed assets. If, for example, there has been a theft, gif, or scrapping, this is a retirement without revenue. Figure 4.85 shows the values of a truck, displayed in the Asset Explorer. Company Code tH) OES Comp asset “0000006003 (O—Piekup wk Washington ABSISE (new) rear (DBD) Arena vaies| Posesvaves | Comparisons | Pxaneters Hane Planned values US-GAAP value Fiscalyearstat| Change, Yearend Crey 6200.00, 82500,00 Uso Uso 2800000 82.600.00 USO 1650000. 16#00,00- 33.000,00- USO Uso Uso uso | No postings for selected fiscal year ‘© Copytght SAP AG. A ght eeere Figure 4.85: Actual data in the Asset Explorer Historical acquisition costs of USD 82,500.00 in 2012 and an assumed useful life of five years lead to a net book value of USD 66,000.00 at the beginning of 2013. At the beginning of March, via a damage report, the vehicle fleet department informs the asset accountant of a total write-off at the end of February 2013. This business transaction is portrayed as an asset retirement without revenue using transaction ABAVN (Asset Retirement by Scrapping). Figure 4.86 shows the data recorded.Enter Asset Transaction: Asset Retirement by Scrapping FB dine tems §changecompony code lurve assets Company Code [FICO] IDES Corp ccet "400000600003] [0 _|Pickup truck: Washington AB9225E Transaction dita | Adstonsl detais_| Parialreteement_ | Note Document Date 28.02.2013) Postng Oate (01.08.2013) Asset value date 26.02.2013) aoe (tient seeppind © Copyrght SAP AG. Al ghis recor Figure 4.86: Retirement by scrapping ‘A document simulation in Figure 4.87 makes the net book value of USD 63,250.00 on account 200010 at the time of scrapping clear. Enter Asset Transaction: Asset Retirement by Scrapping Ay SARE IME BMG Bore soe PAsstons scum sinner Document Header Info Decument Dat: 28022013 Document Tpe: AA Company Code: FICO Line items em PK BUSA GlLAccomt Shut Tot : [ifr 21000 aomoooomooo moo ow aeocmon3 com 40010 Larson sents erp (©Copyrht SAP AG. A ghis resort Figure 4.87: Simulate document ‘Once the document has been posted, the display of the truck in the Asset Explorer changes (see Figure 4.88). A net book value of USD 0.00 arises at the end of February. As the truck is no longer available to the‘company, and is "scrap," the asset retirement results in a correct display in SAP Asset Accounting, Company Cose ie) DES Comp Asset "4000000000031 [01 Pickup ruck Washington A6S225E Fscalyeor f=sp) aw Posted dep. values US-GAAP ‘Fiscalyear start) Change Postedvalues|Crey 250000 82500,00- sD usp 16.5000. 2750,00- 19.250,00- usb usp 19.2500 19.250,00 Stas, Status | Per|t Ord. dep. £Upind dep. # Reserves = lt la Posted Posted Eh 137500 0.00000 13750-00000 © Copytght SAP AG. Al gh eta. Figure 4.88: Changed actual data in the Asset Explorer ‘The scrapping is also reflected in the asset history sheet. In addition to the current depreciation, which runs for two months (USD 2,750.00 = USD 82,500.00 / 5 years / 12 months x 2 months), Figure 4.89 shows the asset retirement in the third column (Retirement/Depreciation Retirement)ASSELEIS IY SRC steal Kd >HGSEPE Be DSOTS Base [ t date: 31.12.2013 Asset History Sheet - 01 US-GA don. 07.11.2012 In compl. w/EC di 4 (3 400000000003 9 01.01.2012 Pickup truck: Washington AB9225e 82,500,00 0,00 82.500, 00 16.600, 00- 2.760,00- 19. 260,00 68.000,00 © Copytght SAP AG. Aig eter. Figure 4.89: Asset history sheet ‘At this point, we can establish that the truck can only be scrapped and represents a retirement without revenue. Life is not always this easy and straightforward, and therefore we will continue this business transaction in the next section. 4.3.4 Retirement Cancellation ‘One month later, the asset accountant receives more mail; this time not from the vehicle fleet, but from an insurance company. The truck that has just been scrapped was fully insured, and since no blame for the accident ‘can be apportioned to the driver, one month later revenue of USD 80,000.00 arises. In addition to this very positive development, the business transaction is to be processed initially as a retirement by sale without customer (see Figure 4.90). GoogleFB Gptine tems §Changecompanycode flute assets Company Code (FICO) Des cop Asset [400000000003] [9 | Pickup truck: Washington AB9225E ABO sions tis Panalrteret | Document Date (e1.04.2073) Posing 1 04.2013) Aertel date (38-02-2013) Tes vero comprare nsianee cea oreenue anal vere (20 000,00] ev tom NBV Th (© Copyrht SAP AG. Alghero Figure 4.90: Revenue from comprehensive insurance (incorrect) ‘The approach selected is incorrect and leads to an error message (see Figure 4.91). The reason for this is a decapitalization of the asset by the scrapping that has already been posted. GoogYou cannot post to this asset (Asset 400000000003 0000 deactivated) Message no, A303 Diagnosis ‘complete retirement or complete transfer was aleady posted tot ‘System Response ‘The systom rejects posting wih the transaction type entered Procedure Check if you entered the correct asset. Either choose a different asset, or reverse the retirement document, or =| (© Copytght SAP AG. Al ght eter Figure 4.91: Error message To portray the situation correctly, in our example the scrapping posting must be reversed, You use transaction ABO8 (Reverse Line Items) to do this. Figure 4.92 shows how you can select all documents for a specific asset within a fiscal year. Documents for Asset Jef Company Code FICO! Asset 400000000003 Subnumber ep Fiscal Year 2013) © Copyrght SAP AG. Al ghiseeere GoogleFigure 4.92: Documents for asset Figure 4.93 shows how, in the document overview, you first select the retirement without revenue performed in period 2 and then WReverse reverse it with the icon. Note that some posting periods are already closed, and therefore in this example, you cannot post the reversal document until the following period 4 Overview of Asset Accounting Documents GB Breen BAY Kade meet “ROOOORORIT TP mck Wasrngor ABIISE ren) Corpo cote Feo" Esco TS CeTE: | Astate sat Posed Ty Tans pe Tet © Copytgh SAP AG. Al gh eter. Figure 4.93: Reverse posting of asset retirement ‘A document overview in Figure 4.94 shows how the reversal document reverses the previous asset retirement without revenue. The book value of USD 0.00 reached with the retirement is increased to USD 82,500.00 again with a debit posting (posting key 70). Further line items for value adjustments (accounts 21010 and 200010) are set back to the original value before the asset retirement without revenue by the reversal document.Ay SARE FMT EME Bere (se Peds score assert Document Header Info Document ate: 28022013 Document Type: A Gongany Code: FICO Posting ates” L040 | Peroa et Recmvears me em |PK Bish GiLAccomt statTet : deout Cry “onnoone03 1600 1922000. U50 Les on assets 509 323000 Uso © copyrght SAP AG. Al ght eee. Figure 4.94: Simulate document ‘The Asset Explorer in Figure 4.95 shows the re-capitalized asset and now positive net book value. In the lower area, you can see two documents (1) Retirement without revenue and (2) Reversal with the respective reference date 02/28/2013, GoogleDean eas) © copyrght SAP AG. Al ghis eeered. Figure 4.95: Overview in the Asset Explorer ‘After the reversal, a positive net book value is also displayed in the asset history sheet (see Figure 4.96). wasn, GoogleKd >HQaP? BH DIRT BAG Report date: 31.12.2013 Asset History Sheet - 01 Created on. 07.11.2012 In compl. w/EC directive }400000000003 6 01.01.2012 Pickup truck: Washington AGC 82.500,00 0,00 0,00 16 500,00- 16 500;00- 0,00 66. 000,00 © copyrght SAP AG. At ghis eared. Figure 4.96: Asset history sheet Now you can post the revenues from the comprehensive insurance. The corrected retirement without revenue has become a retirement with revenue. Figure 4.97 shows how USD 80,000.00 can be realized as revenue for the truck from the insurance. FB Gptine toms §¥Change company code toe assets Af IDES Comp asset 400000000008) [0] Piekup truck: Mashington A69225E (nen) [Cero] | Postrg Oa (01-08 2013) ‘eset vale date (202.2013) | Wee "Revenue fom comprehensive surance ©copyight SAP AG. ALAghis tered. GoogleFigure 4.97: Revenue from comprehensive insurance (correct) The revenue of USD 80,000.00 is higher than the time-based net book value of the truck of USD 63,250.00 (82,500.00 — 19,250.00). Therefore, a profit of USD 16,750.00 arises (see Figure 4.98). Document Header Info Line items em PK BA Acca Stun Tet : rat oy crs 2090 oma 220100 U0 Suspense a - spo 10.000,00 uso © Copyrht SAP AG. Al ghis sore Figure 4.98: Simulate document Now that we have completely assigned the accounts for this example business transaction, in the next section, only a small part of the asset is to be retired. 4.3.5 Partial Retirement ‘Once again, the asset accounting department receives information from the vehicle fleet. On a dark night, someone broke into a truck and stole the navigation system that was installed, This business transaction is reflected in transaction ABAVN (Asset Retirement by Scrapping) (see Figure 4.99). As the truck is stil available to the company, this time further details are required on the Partial Retirement tab.Enter Asset Transaction: Asset Retirement by Scrapping FR Gptineitems €¥Change company code latinle assets Company Code __ [FICO] IDES Cop Asset "400000000004) [0 Pickup AacO Document Date 75.01.2013) Postng Date 16.01.2013) Accet vate date 16.01.2013) Tet [ietofnaain gem © Copyrght SAP AG. Al ghis reser Figure 4.99: Theft of navigation system ‘The theft causes damage of USD 2,500.00. Note also that the truck, including the navigation system, was acquired in the last fiscal year. ‘Therefore, there is a partial retirement with reference to asset data from previous years (see Figure 4.100). Using the Additional Details tab, you can define special information for this business transaction. This is useful, for example, if you want to evaluate value losses based on the various thefts at the end of the year. You can then use a separate transaction type to do this. In our example, we use standard transaction type 201 (Retirement Due to Force Majeur without Revenue),FB Geineites $¥Change company code tle assets B Company Code FFTCH WES Com Aectt ‘aoo000000004) [0 | Pickup azco _ Transaction data | Additonal details (PSS RERER|. Note ‘Amount posted (2.500,00 | Percentage rate T Quanesy 7 [Remedto @Prioeyear accu. (OFrom curry acu. © Copyrght SAP AG. Al ghisreeered. FH Geri cms change companycode fle assets B Compary Code [FICE] BES Cop Ascet 400000000064) [0] Pickup ABCD “Transaction dts Parisreirement | Note ‘Special spe for document Posing Ped CO Document Tipe 0 _ Speci spect forrancacton Transacton Type (201) Retrement de to force majeur wahout revenue Teg Pater = ‘Adstonalinioondocument Reterence ‘locaton | ©Copyright SAP AG. Aghis teres. Goog'Figure 4.101: Partial retirement For the navigation system, a document posting corrects the value of the balance sheet account with the original acquisition costs of USD 2,500.00 and the proportionate depreciation that has already been calculated on the value adjustment account in the amount of USD 458.34. Document Header Info Dewuram.Oa: 18012019 Daman Tp: A Company Cade: ICO Postings” 8012019 Peroa oF Rectan Line items Rem. PK Buck Gl-tecort Str Tet : race Cry [ty 2ioe0 atone ooo 260000. USD b zm aio atoms com ‘emt L240 10 Less onassete scrap 201186 US © Copytght SAP AG. Al gh eter. Figure 4.102: Simulate document In Figure 4,103, the Asset Explorer shows the changes in value of the truck, excluding the navigation system. The acquisition value, reduced by the proportionate depreciation, results in a loss of USD 2,041.66.commnycoe Gp) es cow Facayer 5D) oso 240000 10m UD rom.eeo 2 oss ory “sam 2001ee USO © Copytght SAP AG. Al gh exered. Figure 4.103: Asset Explorer Figure 4.104 shows the corresponding asset history sheet with a retirement in the third column (RetirementDepreciation Retirement). ‘Accordingly, the acquisition and production costs are reduced to USD 100,000.00, that is, the original acquisition costs of the truck excluding the navigation system, © Copyraht SAP AG. Aghis teres. Figure 4.104: Asset history sheet GoogleIn addition to the partial and complete retirements that we have already shown, within groups of companies, assets are frequently transferred between the legal entities of the group. 4.4 Transfer We must firstly differentiate the term transfer from the business transaction of a transfer posting. Movernents within a company code are referred to as transfer postings. In practice, this happens, for example, if you have created the asset in an incorrect asset class and a transfer posting is necessary for correct display. Another example is assets under construction and their settlement or manual transfer postings to the completed asset. As stated, the different forms of the transfer posting transaction take place within one company code. In contrast, a transfer refers to asset transactions between different company codes. In the following example, a computer is to be transferred from company code FICO to company code 1000. Figure 4.105 shows the current actual data in 2013,Company Code [FICO IDES Comp Asset ‘490000000005 [0 Computer 1 Fecalyer —- (@) 20731) _Alarined values) Posted values _\ Comparisons _ Parameters 6/2) Bio) Planned values US-GAAP Value Fiscal year start_ Change Year-end Crey 10.000,00 1000000 uso uso USD Uso uso Uso 2.000,00- 2.000,00- 4,000.0 'No postings for selected fiscal year (©Copyrht SAP AG. A ghis oso. Figure 4.105: Asset Explorer actual data You can record an asset transfer very easily with transaction ABT1N (intercompany Asset Transfer). In addition to the asset number of the ‘outgoing company code, you need an existing or new asset number in the receiving company code. In the example in Figure 4.106, a template is used to create the asset master record in the receiving company code. In this transfer, no details are entered for revenue. If the book values in the new company code are to be updated and no profit arises between the company codes, this transfer variant has certain prerequisites, Both company codes must belong technically to one company, otherwise the ‘error message shown in Figure 4.107 appears.Enter Asset Transaction: intercompany Asset Transfer Berteeems Reramecoromyeate Bites AB cmomycow FD. wescom RORY ater ons Bas ts OP Sectonorste rea © opytgt SAP AG. A ght exer. Figure 4.106: Enter transfer Transaction type 230 not possible (no affiliated company specified) Message no, AAS®9 s © copyrght SAP AG. Al ghiseeered. Figure 4.107: Error message — associated company In our case, we have to check the Customizing settings for the sending company code FICO. Both company codes FICO and 1000 belong to the ‘same company (1000) in the group of companies and must therefore be considered as legally dependent. In this case, the company is the Google‘smallest unit for creating legal financial statements. in Customizing, both company codes must refer to identical companies. The settings are located under Financial Accounting > Financial Accounting Giobal Settings > Company Code > Enter Global Parameters. As shown in Figure 4.108, you maintain the company in the global data of the company code. Canayiay—_(S) Conwy EO) Lanne ey @ Aecerteg aginion ‘arrepnne. ETAT] © copyrght SAP AG. Al ghee. Figure 4.108: Change global company code data With the settings that you make now (company code FICO = company 1000), both company codes belong to the same company. As a result, the error message disappears and you can simulate the document (see Figure 4.109), Enter Asset Transaction: intercompany Asset Transfer Ay SARE BEM Berose Boe Pessnesiaccomsssqrnen Document Header Info FPosingoua” Teeaa0ia Peres” "oa fears 20 Line items | 20 ‘21010 opoou9427 000 acl ‘© Copytght SAP AG. A ghis eee Figure 4.109: Simulate document‘The posting document is actually two posting records. In the second column (CoCd), you can see the different company codes. In company code FICO, the asset is retired with the current net book value of USD 7,833.00. This value is calculated from the acquisition value of USD 10,000.00, minus the depreciation for 2012 of USD 2,000.00, and depreciation for one month in 2013 of USD 167.00. At the same time, the ‘computer is added to company code 1000 with the updated acquisition costs in EUR. No revenue arises within the company. In the outgoing company code, the transfer has the following effect (see Figure 4.110). Companycose [jo’ wes co pose “soonn0000005 Computer Foca OD) Posted rere Planned values US-GAAP vive Fealyearsat) Charge Yearend Coy jaecransacions| 1000020 1000000. 030 ier 21m s0 nomen tema use Financial Accounting > Fixed Assets > Periodic Processing > Depreciation Run > Execute (transaction AFAB, Post Depreciation, program RAPOST2000) In Figure 5.5, you can see the selection parameters for our asset, the desk. In this ‘example, the various reasons for a depreciation run are initially important. A posting run according to plan is the first depreciation run due for a period according to the plan and in the example, this took place in posting period 12/2013. lf you have already executed a depreciation run and Fl-AA-relevant postings have been executed subsequently, a new depreciation run is necessary for these few subsequent business transactions. This falls under the Repeat category. The programs for the depreciation run are ‘executed in the background and in most cases, are run completely and ended correctly. In a few exceptional cases, in which the SAP program is terminated incorrectly, or terminates itself, the Restart option. is necessary. If you want to skip individual depreciation periods for test periods, for example, you use the Unplanned posting run option,Depreciation Posting Run Onn or raed pra an Man sexton ® 3) post anaarer = a © copynght SAP AG. Al ghis eee. Figure 5.5: Depreciation run selection parameters In the first attempt, a planned posting run for period 12/2019 is selected. The error message in Figure 5.6 indicates that a depreciation run has already taken place for period 02/2013; a monthly depreciation run in Period 03/2013 would be next AS én) SPM RF DEI) Teton Message Tet uo [eB oto Accersra poeta yey sho post eros OIG net ) © copy SAP AG, A ihrer. Figure 5.6 Error message‘As already mentioned, the various depreciation areas are summarized in ‘a depreciation run. In the Reference Document column, you can already ssee the document to be created within the test run, You must analyze any error precisely. ‘Depreciation Posting Run for company code FICO 29499 2NO O5aTOn Bago Oe TESTRUN © copyrght SAP AG. Al ghis eee Figure 5.7: Test run with errors g Using the Error Log icon ‘or double-clicking the error ERROROOOO1 | message displays the error log shown in Figure 5.8. Due to a block, the depreciation run cannot use cost center 1234 in controlling area 1000.oo) SPM RF OE.) SIeaaoeA Typeltem Message Tet ur {B12 _nescaa(s) dung check of ocura ERROROODD! (cost cerer 10007234 baci apart orectpostgs on 91122013) {BEND Ever messopes ate processing of sets BBE} Poeingrm ences wh erers @ se Wewict iomenen 8] ‘© Copytgh SAP AG. Al ght esa Figure 5.8: Error log Figure 5.9 shows a block for primary costs on the Control tab. There are two options for rectifying the error in the depreciation run. You can either change the cost center defined in the asset master record, or remove the block using transaction KS02. (BJ Change Cost Center: indicators 1G Gostdonn Costcener 257 —T) Departrent Contoing ee ‘oo! ‘coEuere Vaid Fram Or OTwIT wo SAE aaa Basic dae Temples | Rkress | Communication | Hi [Record Gueety Lok cus preva et secondary costs cual venues Pan pray cons Plan secondary costs ‘Pan everues Commeert update © Copyrht SAP AG. Alghis eso Figure 5.9: Change cost center ‘The depreciation run can then run without errors and creates one document for each accounting regulation. In the case of the US GAAP posting, the calculated depreciation amount is posted in leading ledger OL(see Figure 5.10) (© Dispty Document: General Ledger View BD Semeur Rewer cacy Smee " wren I aye Seo ws [©Copyrht SAP AG. A ghis oso. Figure 5.10: US GAAP — posting document For a valuation according to TAX purposes (HGB), in this scenario the value is not updated at all. Similarly to the US GAAP valuation, the same general ledger accounts are used. Differentiation of the valuations is only possible via ledger groups. Figure 5.11 shows the different ledger groups that can be used (configured),? (ea eel) |.) Ledger ~ Text —— [iF BZ \is |.6 |v LB |zR 8 Entries found © Copytgt SAP AG. Al gh eee Figure 5.11: Ledger groups In addition to scheduled depreciation, there are other business factors that require manual, unplanned depreciation. 5.1.2 Unplanned Depreciation In addition to scheduled depreciation, which is calculated from a ‘combination of the depreciation key and depreciation duration, it may be necessary for business purposes to undertake unplanned depreciation, For example, this could be due to a vehicle accident with an associated, unplanned massive loss in value. Another example is hazardous waste discovered on your real estate — this reduces the value of the asset permanently and contrary to plan. In this section, we will use a comprehensive example to present the ‘options for unplanned depreciation in the SAP system. The business transaction starts with transaction ABZON (Acquisition with AutomaticOffsetting Entry) and the purchase of property in January 2013 for USD 1 milion, as shown in Figure 5.12. Enter Asset Transaction: Acquis. w/Autom. Offsetting Entry FB éivetams Stcrnoeconpun coke Mace este SI QL Corpany ose FI00 10S Com Easing asset ascst Cass (1100, Ainsseton tts | tessvens dees De Occirert Date 01.209) Posing Cate 01.01.2018 ‘eset ole ct 01-01-2019) ‘amour pasted 100.600, 00 [USD uenity Tet eee copy SAP AS. Alii cone Figure 6.12: Asset acquisition With a planned useful life of 50 years and a linear depreciation profil this results in an annual scheduled depreciation amount of USD 20,000.00. A few months after completion of the purchase agreement, you establish that the property cannot be used or rented out. This, situation leads to an unplanned decrease in value and must be taken into account in asset accounting. Use transaction ABAA (Unplanned Depreciation) to call up the initial screen for unplanned depreciation shown in Figure 5.13.Unplanned depreciation: Initial Screen Company Code FICO) Asset 5 ‘Subnumber 0 4 Date specif Document Date (01.07. 2013] Posting Date 61.67.2013] Posting Period 07 Transact “Transaction Type {650 Unplanned depreciation on new acquistion Figure 5.13: Unplanned depreciation — initial screen Differentiation between asset data from previous years and current balance ‘The default value usually proposed in transaction ABA is transaction type 640 (Unplanned Depreciation on Asset Data from Previous Years). If the acquisition year and depreciation year are identical, use transaction type 650. As the text is not changed when the transaction type is changed, the entry looks as shown in Figure 5.13. Figure 5.14 shows the unplanned depreciation of USD 750,000.00 on the current balance. Additional text details mean that the transaction is also transparent and traceable at a later point in time.Create Asset Transaction: Unplanned depreciation on new acquisition Peers ‘Company Coe Posada rs es 5 oatera nen Free [eb l urges een en new ac ase oer © Copyrght SAP AG. Al ghis reserve Figure 5.14: Unplanned depreciation — enter transaction ‘You can define individual posting amounts for the respective depreciation areas (see Figure 5.15). For example, if there are different appraisals, you can take this into account here. If you use this technical option, this ‘could lead fo queries with regard to the different appraisals in an external audit.Asset 151 Butng nen ‘ea Valves ‘es Dep.wea_ Tra |Arountposted | Crey Vat O1US-GAP 650 750.000,00-USo 10TAX 660 750.009, 00-1150 a1 MALTMN 650 _—_‘760.000,00-1ISD a1 (RACE 650 _750.000,00-USD on 19E6P 650 _750.000,00-USO a1 TTMACRS\Siste) 650 750.000, 00-USD 1 30Grayp USD 650 __70.000,00- USO a1 31GraupCur 650 70.000,00- USO 30 B2BIOep(acu) 850 70.000,00- USO a1 AOSMACRS —650_—_70.000,00- USO a1 © Copyrght SAP AG. Al ghee Figure 5.15: Valuation per depreciation areacompary cose (FICO ES cop asset Is 10 Bulking in erin Fecaiyer (4) 075 (5) ostedvaes Paranecers 1.) 8) ae) Planned values US-GAAP Fiscalyearstat Change Yearend rey ‘.000.000,00 1.990.00090. USD uso 2000000- 2000000. uso 750.00000- 760000,00- USO uso uso © copyrht SAP AG. Al gis reser Figure 5.16: Values in the Asset Explorer Posting the unplanned depreciation initially only affects the FI-AA subledger accounting. In the Asset Explorer in Figure 5.16, you can see the depreciation amounts under Planned Values. As. unplanned depreciation also causes the depreciation basis for the scheduled depreciation to change, the scheduled depreciation amount is reduced hete as well. The general ledger and subledger are not synchronized again until” the depreciation run (transaction AFAB or report RAPOST2000). The log in Figure 5.17 shows very clearly how scheduled and unplanned depreciation can be displayed together in one depreciation run.‘Depreciation Posting Run for company code FICO 20899 240 O58078m meen oe TESTRUN Figure 5.17: Execute depreciation run ‘The resulting value-reducing document contains both depreciation types. Now that you have learned about scheduled and unplanned depreciation via the depreciation method and the periodic depreciation run, in the next section we will present a further periodic activity in SAP Asset Accounting, 5.2 Periodic Balance Sheet Postings ‘The FI-AA subledger allows parallel accounting, which is reflected primarily in different depreciation terms. In practice, however, there are also examples in which the acquisition values of assets such as patents ‘or software created in-house must be assessed differently for each accounting regulation. We will explain this further using the example of an internal order. In addition to the selected capitalization key 002000, on the Period-End Closing tab, the master data of the internal order also contains a link to fan asset under construction. Figures §.18 and 5.19 show both transactions. When creating an asset, you transfer the capitalization key to the asset master record via the menu item Extras > Asset under Construction.Coseryee TAS cp mesmees- Desist atone pees Ez Corelais | Prenton | Comets | wears ‘Conca Coat (oo) esa0 pemerery 1600) ergrerng eratuctn ‘ope Cs —— apo ov Creo egezrg cc ReprargcoCom TH) enema © Copyrght SAP AG. Al gis reeered. Figure 5.18: Create intemal order & oie Bit ceo [Eaae] Eonar Siem te ws ‘mascae son [2'S0O8 Create interna ¢ Be seer) coneremvn oe) camo 8) cp meres coma 7 Aas Ca osoersamctoenonnd._ see? © Copyrht SAP AG. Aighis esere. GoogleFigure 5.19: Connection to asset under construction ‘Therefore, as well as the master data of the internal order, you create a master record for an asset under construction and connect these two elements to one another. This is done automatically: the selected capitalization key from the internal order is automatically transferred to the asset under construction master record as capitalization key (see Figure 5.20) (BL) Change Asset: Master data UD rece: ee") ests Con Cay Cote "T88 ecarmaten "$3030 Dawgs ps an assets uae conston ey ber arses cs ey ‘Conner Taos Ameren No Ben THEO ZS © Copytht SAP AG. Al ghis eerie Figure 5.20: Create asset under construction In Figure 5.21, you can see a debit to the internal order just created for USD 100,000.00 by means of a G/L account posting. In local currency it is for EUR 76,923.08. Other business transactions such as extemal vendor invoices or internal time confirmations can also contribute to the transaction of creating a patent and can debit the intemal order. In Customizing, you can define different valuations for internal and external services using capitalization percentage rates.Enter GA. Account Document: Company Code 1000 Brieeen Micon cer Qe seine Gee f caneins a ‘© Copytg SAP AG. Al gh esa Figure 5.21: Enter G/L account document ‘The periodic actual settlement of the orders is located in the application menu under Accounting > Controling > Internal Orders > Period-End Closing > Single Functions > Settlement (transaction KO88, Settle internal Order). Figure 5.22 illustrates the transaction for petiod 11/2013, ‘Actuoi Settlement: Order @ Sertemert Rise rae coe : Postgres © copynght SAP AG. Al ghis eeere. Figure 5.22: Internal order actual settlement ‘The log in Figure 5.23 shows the basic list for a settlement that has been ‘executed and thus the credit to the internal order.‘Actual Settlement: Onder Baste st =o ‘Selection fo eee © copynght SAP AG. Al ght eee Figure 5.23: Actual settlement log Using the Detail List icon, you can call up the detail list for the log (see Figure 5.24). In addition to the settlement receiver (asset under construction), you can also see the credited amount of EUR 76,923.08, which equals USD 100,000.00. Actual Settlement: Order Detail list Gasictst BQ) Glsender Grecever ff] senemetae AF EM Detail list - Settled values ‘Sendere "Shortie Sender "Receivers ValCOtrOur/COArC FORD SS000424 coct clectorfor patents FHA TOOOHZNQO 7807202 EUR ©Copytgh SAP AG. Al gh esa Figure 5.24: Detail list What the detail list does not show are the different capitalization values (acquisition values) for each depreciation area. To see these, let us take look at the Asset Explorer. Figure 5.25 shows the different acquisition values in the depreciation areas 01 (US GAAP), 60 (TAX), and 64 (delta between US GAAP and TAX) according to the defined capitalization keys (US GAAP 100%, TAX 90%).cononycase 3669 656 rau (Jab) & L201) Figure 5.25: Values in the Asset Explorer In the example selected, the ledger solution in New General Ledger is used as a storage location for parallel accounting. The leading depreciation area 01 (US GAAP) is connected with ledger OL and the TAX area 60 with ledger L8. In such cases, itis important to know that the leading depreciation area 01 also posts to all ledgers, ie, OL and L6 for actual different balance shest values. With this type of integration, the TAX acquisition value of EUR 76,923.08 is initially not correct. Here, the delta depreciation area 64 comes into play. The difference amount of EUR 15,384.62 calculated there between US GAAP and TAX is only posted to TAX ledger L6 and gives an overall incorrect valuation base of EUR 76,923.08 (see Figure 5.26). As this posting does not take place automatically, start the periodic asset poster with transaction ASKB (Periodic Asset Postings). ‘© Copytgh SAP AG. Al ght esaFigure 5.26: Log of the periodic asset posting If the acquisition values of intangible assets created in-house are not identical, a multilevel procedure, for example, using an internal order, is necessary. This intermediate step via the cost collector internal order and the capitalization versions defined in Customizing enable you to treat a business transaction in different ways. Once you have executed all periodic asset postings, you can start the subsequent activities in the change of fiscal year and year-end closing, 5.3 Change of Fiscal Year and Year-End Closing In addition to the periodic work in accounting, the change of fiscal year and year-end closing in SAP Asset Accounting are particularly important. ‘These activities refer initially purely to the subledger and should not be confused with your closing activities in G/L accounting, 5.3.1 Change of Fiscal Year ‘Similarly to the balance carried forward in the general ledger, the change of fiscal year in SAP Asset Accounting is a technically defined transaction. A new annual value field is created for each asset on the database. Figure 5.27 shows the required transaction AJRW (Fiscal Year Change), ‘Asset fiscal year change ° ‘company ates) New scale ‘Serer group tr | @ © Copyrght SAP AG. Alghero. Figure 5.27: Fiscal year change selection screen Ina live system, you should not start the program until the last period of the current fiscal year. It completes a fiscal year change for the company codes selected,Asset fiscal year change ag¥ 2% 14a 8 Gi Beworiog |Fiscal year change statistics -Test version | staus Company Code Read. Arendych Wihostva [Areadyde|Te change. hcorect | coe co a) nace oo ‘©Copyright SAP AG. Al gis exer. Figure 5.28: Perform fiscal year change In contrast, the year-end closing checks the posted and any open business transactions for a fiscal year to be closed, 5.3.2 Year-End Closing Before performing year-end closing in SAP Asset Accounting, you should check three things: > check your depreciation lsts and asset history sheets for completeness. Year-end closing is only possible and useful once all depreciation has been posted P Check all asset postings for completeness. The asset postings must have been periodically transferred from SAP Asset Accounting to the general ledger. > You can sil change the values in Asset Accounting and GIL Accounting with mass changes to master data and new depreciation runs. Check the Asset Accounting contribution to operating income for the entre balance sheet and proft and loss statement. You should only perform year-end closing once you and your superior are satisfied with ths. ‘The year-end closing program (program RAJABSO0) checks two things: while the year-end closing is being performed, the old fiscal year is blocked for postings in SAP Asset Accounting. You can release it ‘manually as often as required, but you then have to start the year-end closing program again. In the example in Figure 5.29, fiscal year 2012 is closed for company code FICO. A test run takes place first.Year-end closing Asset Accounting o Fiscal year be sede corpany cote) Compa eae eo » @ Aarti wt cot - » a pean © Copytht SAP AG. Al ghis retore Figure 5.29: Perform year-end closing The test run log indicates errors with regard to depreciation that has not been executed (see Figure 5.30). Therefore, a repeat run of program RAPOST200 is required for period 12/2012 ‘Year-end closing Asset Accounting for fiscal yeor 2042 a ‘© Copytght SAP AG. Al ght eter Figure 5.30: Log — depreciation incomplete Once all postings have been completed, you can execute the actual technical SAP fiscal year change. The log in Figure 5.31 shows a successfully completed fiscal year change 2012 for company code FICO.Figure 5.31: Successful year-end closing With transaction OAAQ (Take Back FI-AA Year-End Closing), you can get an overview at any time of which fiscal years have been closed for ‘each company code in SAP Asset Accounting (see Figure 5.32). Here you can undo the closing by overwriting the year number. However, you ‘cannot set the year number higher. Change View "Remove Year-End Closing QoB Co... | Closed fiscal year a | Fico 2012 - kvBo 2010 = SLO1 2005 (© Copytgt SAP AG. Al gh esa Figure 5.32: Taking back year-end closing 5.4 Summary In practice, monthly, quarterly, and year-end closing lead to a hive of activity in ‘asset accounting. This is particularly the case if multiple accounting regulations (e.g., US GAAP and TAX) have to be taken into account simultaneously. The FI-AA subledger offers a high level of automation for parallel accounting and the associated differentiation between acquisition and depreciation calculations. Continuing from thisbasis, the SAP programs for periodic work, depreciation postings, and for year-end closing and fiscal year change provide sufficient support for realizing a fast and high-quality closing (fast close),6 Evaluations in SAP Asset Accounting In this chapter you will learn about all relevant evaluations in SAP Asset ‘Accounting. The focus is on business requirements and less on the SAP system as a reporting tool. We will explain evaluations for daily business and for financial statements in detail using practical examples. 6.1 Asset Balances In collaboration with other departments in the company, the asset accountant creates asset master records. For example, when an asset is purchased, the number of the asset master record is already linked with the business transaction in the purchase order or in SAP Accounts Payable Accounting. From the view of the asset accounting department, it is necessary to maintain an overview of which master records are already being used, 6.1.1 Directory of Unposted Assets For example, if the IT department requested an asset master record ‘some time ago, and the asset accountant created it, it should also be Used. The application menu contains an evaluation of unposted assets under Accounting > Financial Accounting Fixed Assets > Information System > Reports on Asset Accounting > Day-to-Day Activiies > Intemational > Directory of Unposted Assets. Figure 6.1 ‘shows the selection screen for the evaluation.(@Lsisre) Coes ns © Copytght SAP AG. Al ght eee Figure 6.1: Selection — Directory of Unposted Assets In the results list in Figure 6.2, you can see @ number of old, unused asset master records in the directory of unposted assets. You should delete these to avoid incorrect account assignments. This procedure also applies for the example of the asset master record requested by the IT department, which also appears in the list. If the master record was created years ago and there have been no postings to it by 2013, a deletion would be justifiable and permitted. However, the question is why the master record was present in the SAP system for nine years with no reaction from the asset accountant.Directory of Unposted Assets 1 - Crested on 081.2082 (reser [SNo, [Creaedon“|Grestedby Asset descrpson 10022012 SEBERT riage 76032012 RAE Test Transier3 90032012 WARKUS TEST MARKUS MARKUS TESTMARKUS 2 MARKUS TESTMARKUS 3 MaRKUS TEST MARKUS 4 MARKUS TEST Mars 68 MARKUS Maretng Campaign MARKUS ———Maretng Campaign MARKUS Marating Campsign MARKUS Maceting Campion MARKUS Mareting Campaign MARKUS Marating Campaign MARKUS ———Macating Campaign 10062012 LARSSA Test nla afr Kay LARISSA —__TestAiage in Bao Kay LARISSA —__—_Testiage in Bau Kay LARISSA Test ioge in Bau fr Kay kav Panes 00-002| so072012 SUE a cooper 08082012 ARNO honda cc BNO honda cc © Copygh SAP AG, ih seed Figure 6.2: Results list — Directory of Unposted Assets In addition to the directory of unposted assets, there are many different evaluations for listing the asset numbers used. 6.1.2 Asset Balances by Asset Number Once asset master records have been created, they are generally also used in the account assignment of business transactions. When other departments outside asset accounting perform the account assignment integratively, a regular check of the asset balances is useful and very helpful for the asset accountant, The application menu contains several evaluations for the asset balances under Accounting > Financial Accounting > Fixed Assets Information System “> Reports on Asset Accounting > Asset Balances > Asset Balances. The report selected in Figure 6.3 shows an evaluation by asset number. ‘Alternative sort versions enable you to arrange the structure of the results Googlelist according to many other criteria, ©copytght SAP AG. A gh eter. Figure 6.3: Asset balances with sort sequence by number and company code ‘The results list in Figure 6.4 shows that identical assets such as PCs have a similar or even identical acquisition amount with USD 10,000.00. If there are extreme deviations, the asset accountant can see this in the list. A PC for USD 300.00 would either be a very cheap acquisition and/or an incorrect posting. ‘Asset Balances anaes 2x0 as00) ‘©copyight SAP AG. A Aghis eared. Figure 6.4: Results list: Asset Balances Google6.2 Day-to-Day Activities In Chapter 4, we presented variants of the individual SAP transactions and business transactions in SAP Asset Accounting. These day-to-day activities are also reflected in the SAP Asset Accounting information system. 6.2.1 Asset Acquisitions The application menu contains the SAP report for asset acquisitions under Accounting > Financial Accounting > Fixed Assets > Information System > Reports on Asset Accounting > Day-to-Day Activiies P International > Asset Acquisitions. Figure 6.5 shows the selection of transaction data restricted to company code FICO and for reporting date 12/31/2012. Asset Acquisitions OGRE Company cse ICD » Setecton Business ae oy Costcanter » Pre » Setoags Reser ste 31.12.2012) Son Variant COTS) Company code Transiaton meth or grup als oly © copyrght SAP AG. Al ghiseeere Figure 6.5: Selection of asset acquisitions ‘Additional information defined in the text field when the asset acquisition was posted explains the business transaction in more detail in the resultslist for the selection (Figure 6.6). In the example, this is the case of the “special vehicle,” for which there is @ down payment after order confirmation. Asset hoqastons WONG RUF EM OP ESM Dom Or comm © Copyrght SAP AG. Al ghis reserve. Figure 6.6: Results list of asset acquisitions This list also creates transparency for business transactions with reference to SAP Asset Accounting. In particular when the text of the business transaction does not fit the asset and the associated valuation ‘method, the asset accountant has to make queries and any corrections necessary. 6.2.2 Asset Transfer Postings If an asset or asset component is posted to a different asset master record in the same company code, this is a transfer posting. In the SAP_ application menu under Accounting > Financial Accounting > Fixed Assets > Information System > Reports on Asset Accounting Day- to-Day Activites > Intemational - Intracompany Asset Transfers, you will find an evaluation that displays alll transfer postings within a company. land reporting period. Figure 67 shows the corresponding selection soreenintracompany Asset Transfers O&A" H Company code FICO Selections Asset class Business area Cost center Plant Location =p Settings Report date 31.12.2013) Depreciation area Gl US.GAAP Sort Variant 0013) Company Dist assets or group totals onty © Copyrght SAP AG. Al ghis reer Figure 6.7: Selection of asset transfer postings {As is typical for transfer postings, the amount of the submitting asset is negative and that of the receiving asset positive. Logically, the total must be zero. According to the posting text, two down payments were made before capitalization in this case. If the SAP system uses down payment management via special G/L indicator, this evaluation can be used to check the correct writing offremount Trot WOO ROU Y BN OO WEEE Foam Om strain © Copytht SAP AG. A ghis eer Figure 6.8: Results list for asset transfer postings In addition to asset acquisitions and transfer postings, assets also leave the company, 6.2.3 Asset Retirements If an asset is permanently no longer available to the company, this is the basis for the business transaction of a retirement posting. It can be a retirement with revenue (for example, sale) or without revenue (scrapping, theft). The following evaluation shows the situation clearly Accounting Financial Accounting > Fixed Assets > Information System > Reports on Asset Accounting > Day-to-Day Activities > Intemational > Asset Retirements ‘The results list in Figure 6.9 shows the insurance revenue linked to the truck as well as the theft of a navigation system. From the view of asset accounting, both business transactions represent an asset retirement — ‘one with revenue and one without.(©Copyrht SAP AG. A ghis oso Figure 6.9: Results list of asset retirements Special transaction type From the company’s perspective, it would be interesting to be able to evaluate the total thefts within a specific period. To do this, you should not rely on the document text but instead define a separate transaction type for this special evaluation. Depending on the total loss, follow-up actions such as special insurance or engaging a detective agency could be justified and organized. ‘There are many other reports in SAP Asset Accounting for day-to-day activities, We have presented the important ones for acquisitions, transfer postings, and retirements. In the next section we will focus on the profit and loss statement, 6.3 Explanations for the Profit and Loss Statement ‘The main influence of the FI-AA subledger on the profit and loss statement (P&L) is with depreciation postings. From the view of the asset accountant, itis important to have an overview of the following points: > When individual assets were acquired (procurement date) > How the assets are depreciated (depreciation key) Google> Planned useful life > The depreciation amounts This report is located under Accounting > Financial Accounting > Fixed Assets > Information System > Reports on Asset Accounting > Explanations for P&L > Intemational > Depreciation > Total Depreciation. The results list in Figure 6.10 not only gives information for the treatment of individual assets with depreciation keys—depreciation start, depreciation duration, and scheduled depreciation—but also gives a total of the scheduled depreciation for the entire company code. ‘© Copyigt SAP AG. Al gh exer Figure 6.10: Depreciation results list ‘The depreciation thus influences, for example, the key figure EBIT (Eamings before Interest & Tax). In contrast, the EBITA (Eamings before Interest, Tax & Amortization) intentionally excludes the depreciation ‘amounts. In addition to the key figures, the depreciation also influences the basis for a tax assessment. 6.4 Explanations for the Balance Sheet Companies from a certain size are obliged to not only create financial statements, but also to provide an explanation for the asset accounting: the asset history sheet. In the SAP menu, the asset history sheet (RAGITTOO) is located under Accounting > Financial Accounting > Fixed Assets Information System > Reports on Asset Accounting >Notes to the Financial Statements > Intemational > Asset History Sheet ‘The asset history sheet results list is also the reason why, in the context of SAP Asset Accounting, business transactions must always be posted with a transaction type. Otherwise, this type of column-based display of the business transactions as shown in Figure 6.11 is not possible. 8 ‘©Copyright SAP AG. Al gis exer Figure 6.11: Asset history sheet — results list ‘A special feature of the classic asset history sheet (without ALV) is that three potentially individual columns are displayed below one another. ‘This compact information display is practical for an experienced SAP user because all relevant data is presented at a glance. A display with ALV would list the values next to each other rather than below one another, enabling easier export of the data to a spreadsheet program. 6.5 Summary ‘SAP Asset Accounting offers a number of evaluation options in the form of classic lists in a compressed display and alternatively as ALV lists that correspond more to the Excel format. You can also use selection parameters to decide whether you are more interested in the details and thus the individual assets or specific group totals. In the standard delivery, the asset history sheet covers the legal requirements, but these do not always correspond to the intemal information requirements of your ‘company. Where companies are merged, further columns in a separate history sheet version are very useful and you can define them relatively easily and flexibly in Customizing. The presentation of the different examples of evaluations is just a small, but very important extract of the possibilities for evaluations in SAP Asset Accounting.wasn, GoogleA About the Authors Dieter Schlagenhauf started his career as an asset accountant at a subsidiary of BASF AG. After that, he worked as head of fixed assets accounting at SWF GmbH (automotive) and Wandel + Goltermann Group (electronics). In 1993, he switched to consulting and was appointed product manager for fixed assets accounting in the software industry. In this industry, he worked for about 6 years for DCW, a company founded by Dr. Claus Wellenreuther, a co-founder of SAP, and the creator of SAP financial accounting. In parallel, Dieter Schlagenhauf started his own ‘company, INVENTAR Organisationsberatung, in 1997. Jorg Siebert has worked as consultant, trainer and product manager, hhaving more than 15 years of experience with accounting software. For the last 10 years he was employed directly at SAP Germany in Walldort with a focus on SAP ERP Financials. He now works as a freelancing SAP consultant and trainer. His certification as a consultant for SAP FCO and, SAP SEM, his degree in Business Information Systems and hisqualification as certified accountant are the basis of Jérg’s extensive competence.B Disclaimer ‘This publication contains references to the products of SAP AG. SAP, RI3, SAP NetWeaver, Duet, PartnerEdge, ByDesign, SAP BusinessObjects Explorer, StreamWork, and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of SAP AG in Germany and other countries. Business Objects and the Business Objects logo, BusinessObjects, Crystal Reports, Crystal Decisions, Web intelligence, Xcelsius, and other Business Objects products and services mentioned herein as well as their respective logos are trademarks or registered trademarks. of Business Objects Software Ltd. Business Objects is an SAP company. ‘Sybase and Adaptive Server, iAnywhere, Sybase 365, SQL Anywhere, and other Sybase products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of ‘Sybase, Inc. Sybase is an SAP company. SAP AG is neither the author nor the publisher of this publication and is not responsible for its content. SAP Group shall not be liable for errors or ‘omissions with respect to the materials. The only warranties for SAP Group products and services are those that are set forth in the express warranty statements accompanying such products and services, if any. Nothing herein should be construed as constituting an additional warranty,SL Alaa |) Ulich Schldter & Jérg Siebert ‘SAP® HANA for ERP Financials > Basic principles of SAP HANA > Potential of in-memory technology D HANA applications in ERP Financials > HANA configuraction explained With their latest database technology “High Performance Analytic Appliance’ (HANA), SAP is trying no less than to revolutionize the database market by speeding up reports and transactions dramatically, ‘changing business processes fundamentally.Meter eT Use (Profitability Analysis) Stefan Eifler Quick Guide to SAP CO-PA (Profitability Analysis) > Understanding organizational units and master data > Defining the value flow > Setting up a planning environ-ment > Create your own reports Get a headstart into SAP Profitability Analysis (CO-PA)! This practical guide explains step by step, with a simple, consecutive example, how to define all the necessary settings to implement CO-PA. By concentrating only on the essentials, this book will quickly enable you to set up your Google‘own contribution margin analysis.espresso ltitoriats First Steps VR eee eid Vee rene [% Enhanced with video and audio material Martin Munzel & Jérg Siebert First Steps in SAP® > Lear what SAP and SAP software is all about! > Enhanced with videos and audio comments simple, consecutive examples The videos will help you experience the look-and-feel of SAP software without actually having access to an SAP system. Discover navigation in SAP ERP, transactions, organizational units, master data and process design! Google