Fixed Assets

Asset Accounting

AA Overview
Asset Accounting as a Sub-ledger
Asset Class
Chart of Depreciation
Master Data
Create/Change Asset Master Record
Acquisitions
Settlement of an Asset Under Construction (AUC)
Retirement
Depreciation
Asset Accounting

Transfers
Period / Year End Closing
Reporting
 Overview: Asset Accounting as a Sub-Ledger

Asset Accounting is a subsidiary ledger of Financial Accounting.

The appropriate General Ledger accounts are updated each time
you post.
General
General Ledger
Ledger
Assets
Assets Liabilities
Liabilities
1000 1000

Asset
Assetaccount
account Vendor
Vendor
1000 1000
Overview: Asset Classes

The asset class is used to:

sub-classifythe General ledger accounts and

group master records by specific criteria.
Asset Class

Balance
A L sheet

General
ledger
accounts

Buildings Vehicles Assets under Fixtures and

construction fittings
Asset
classes

Asset
master
records
 Asset Classes
Asset Classes Configured
 910000 Land
 910001 Building
 910002 Plant and Machinery
 910003 Vehicles
 910004 Asset under construction
 Functions of the Asset Class

Asset Class

Account Screen Number Special Default Selection

allocation layout assignment features values features

Asset class Acct. determination

Bal. sheet items

Assets Liabilities
Create
asset Asset portfolio
02200000
Assets Real estate
Lathe
Machinery
...
Fixtures+fit. 02115000
...
1 Finance. assets Drill
press
...
 Functions of the Asset Class

The asset class contains default values and control elements which are
passed on to the individual assets when you open a new asset master
record.
By entering useful default values, you reduce time and effort needed for
creating new asset master records. You also ensure that the records in a
given class are handled uniformly.
The asset class is the most important criteria for structuring fixed assets
from an accounting point of view. Every asset has to be assigned to
exactly one asset class. The asset class is used to assign the assets (and
their business transactions) to the correct general ledger accounts. The
most important tasks of the asset classes are:
The assignment of default values when creating assets (particularly
depreciation terms)
The grouping of assets for reporting purposes
Definition of the Asset Classes

Asset classes
Account allocation
Master data Screen layout rule
Client level
section Number range
Default values

Selection of
Section for depreciation areas
Chart of depreciation
valuation data
level
Default values
Asset Classes in the Chart of Depreciation

Class Machines

Chart of Germany USA

depreciation

Areas Book dep. Tax dep. Group Book dep. Group ACRS
... ...
DG30 SNFG LINR LINB LINR ....
Depreciation ....
key decl-bal. invest. str.-line str.-line str.-line
3X support ....
Proposed 10/00 10/00 8/00 _ 8/00 ....
useful life
Minimum _ _ _ 8/00 _ _
useful life
Maximum _ _ _ 12/00 _ _
useful life
 Points from the Asset Class / Dep’n Slide

The Chart of Depreciation is assigned to company code, therefore a class

may have multiple Charts of Depreciation relevant to it.
The asset classes are valid across company codes. The catalog of asset
classes, therefore, applies uniformly to all company codes. This is true,
even if the company codes use different charts of depreciation, and
therefore different depreciation areas
You can assign different charts of depreciation to an asset class, so that
all assets in this class will be treated differently in each country.
Special Asset Class: AuC

Class: Assets u. const. Transaction type groups

Extras 15 Down payment

16 Down payment carried forward
from previous years

 AuC managed as total

AuC status  line item settlement
 capital investment measure

depreciation deprec.
areas key
depreciation is not calculated in
Book dep. 0000
depreciation areas intended for the
Tax dep. 0000 balance sheet
Cost-acc. LINA

negative values allowed

 AUC without line item settlement

Assets under construction in this asset class are managed without the
option of line-item final settlement to receiver assets or cost centers. As a
result:

Only complete transfers or simple partial transfers are possible (in other
words, you can only transfer either prior-year acquisitions or current-year
acquisitions in one given posting transaction).
You can only transfer to one target asset per posting transaction. You
have to enter the amount of the transfer manually.
There is no connection to the original asset under construction in the
capitalized asset. Therefore, there is no exact proof of origin for the original
postings.
 Assets under Construction with Line item settlement

Assets under construction in this asset class are managed with the option
for final line item settlement to receiving assets or cost centers. As a result:
On the capitalized asset, you can then see the relationship between the
capitalized asset and original postings to the asset under construction - you
can accurately identify the origin of the postings.
AUC’s can be settled to multiple final assets / asset classes
Assets under Construction from Investment measure

Assets under construction in this asset class to be created solely for

capital investment measures (internal orders or projects).
The assets in this class can not then be directly created and posted in
Asset Accounting. The assets can only be processed by means of an
order or WBS element, to which they are assigned.
 AUC Asset Class: Points from previous slide

Assets under construction require their own asset class.

Choosing the depreciation key ‘0000’ ensures that depreciation is not
calculated for the asset under construction in depreciation areas that are
posted to the balance sheet.
Assets under construction have to be shown separately in the balance
sheet.
The component IM (Investment Management) is available for managing
more extensive asset investments from a controlling-oriented perspective.

There are three asset classes for Assets Under Construction configured.
These are:
Asset under Construction
Asset under Construction with Line item settlement
Asset under Construction from Investment measure
 AUC Asset Class: Points from previous slide

Assets under construction require their own asset class.

Choosing the depreciation key ‘0000’ ensures that depreciation is not
calculated for the asset under construction in depreciation areas that are
posted to the balance sheet.
Assets under construction have to be shown separately in the balance
sheet.
The component IM (Investment Management) is available for managing
more extensive asset investments from a controlling-oriented perspective.

There are three asset classes for Assets Under Construction configured.
These are:
Asset under Construction
Asset under Construction with Line item settlement
Asset under Construction from Investment measure
Overview: Depreciation Areas

You will generally need values for fixed assets for various
business and legal purposes (for example, for book
depreciation, cost-accounting depreciation and so on). In the
R/3 FI-AA system, it is therefore possible to manage values
in parallel in as many depreciation areas as you want.
The Chart of Depreciation

Chart of
depreciation
Depreciation Book
area 01 deprec.

Depreciation Tax
area 02 deprec.

Depreciation Special
area 03 reserves

Depreciation Cost-acc.
area 20 deprec.

Depreciation Group
area 30 deprec.
 Depreciation Charts/Areas in A Ltd.
Depreciation Charts:
Z910: Chart of Depreciation: A Ltd
Depreciation Areas:
01: Local reporting Y1
02: Parent reporting Y2
31 Consolidated balance sheet in group currency
32 Book depreciation group currency (profit center)

There is no set relationship defined in the system between the chart

of accounts and chart of depreciation.

Company codes in Financial Accounting are assigned to a chart of

depreciation – refer following slide.
Asset Accounting Company Code

Chart of accounts Chart of

depreciation

Financial Accounting
Company Code

+
Data for Asset Accounting

=
Asset Accounting Company
Code
Master Data
Creating the Asset Master Record

Create
asset

using asset class using a reference

taking over the default 'copying' an

values from the asset class existing asset
Time-Dependent Data

ASSET MASTER RECORD

- Time-dependent data -
New Interval

Calendar
Enter period under consideration

M
01 Valid from MMDDYYYY
onth Valid to MMDDYYYY

Cost center A from 01/12/YY to 08/27/YY

Cost center B from 08/28/YY to 11/30/YY
Cost center C from 12/01/YY to 03/14/YY
. . . . .
. . . . .
. . . . .
 Master Data Creation/Change: Key Points

When you create the asset master record, you have two
options:
Use the asset class, to which the asset will belong, to
provide default values. The asset class then supplies the
most important control parameters in the asset master
record.
Use an existing asset as a reference for creating the
new asset master record.

Some information in the asset master record can be

managed as time-dependent data. This is of particular
significance for cost accounting assignments (for example,
cost center, order, project).
Acquisitions
Asset Acquisition - Integration
100 110
Assets Accounts Payable Acquisition
purchase
Acquisition in-
house
production

Fixed Asset Vendor

Aqcuisition with Vendor
100 100
 Asset transaction integrated
with Accounts Receivable or
Accounts Payable
Assets General Ledger )Only for direct Asset purchases(
No PO
Fixed Asset Clg Acct Aqcuisition with Auto-offsetting Entry
100 100  Asset transaction posted
using clearing account (not
)integrated
Assets Accounts Payable )Only for direct Asset purchases(
Aqcuisition with MM-PO
Fixed Asset Vendor  Asset transaction posted
100 100 MM from Materials Management
)MM(
Asset Acquisition – MM Integration
Create Master Record
Purchase Requisition
op With assignment to
ti o
na WBS
l

Building
Purchase Order
required
Goods Receipt
Valuated Non-Valuated at i on
tal iz
api
C
or
Goods Receipt Assignment of
Internal Orders
WBS
To manage
Invoice Receipt budget
expenditure
Retirement
Retirement

Assets can be retired:

With Revenue
Without Revenue (scrapped)
Asset Retirement: Types

Please retire me, I am

no longer productive Types of asset retirement

1. Retirement with revenue -

selling of an asset either at a
market price, net book value or
other settlement price

2. Retirement without revenue -

writing off an asset which is
no longer productive or has no
residual value
Asset Retirement w/ Customer :
Accounts
210 200
Retirement: - Acquis date 01/01/20xx .- APC = 6000 ,1 Retirement Retirement
sale scrapping
- Complete retirement of APC on 03/15/20xx
- Revenue400 + 4000sales tax

A/R posting P+L or FinStmt Notes

Revenue
Customer Asset Retirmt
4000
4400 4000

Assets posting
P+L
Clearing of
Asset Asset Retirmt Loss
1 6000 6000 2 4 4000 1300
3 700

1 APC
APC 3 Proportional
Proportional value
value adjustment
adjustment
2 Amount retired 4 Clearing
Clearing of retirement
Depreciation
 Depreciation
SAP supports the following direct types of depreciation:

Ordinary Depreciation: planned reduction in asset value due

to normal wear and tear.

Special Depreciation: depreciation that is solely based on tax

regulations.

Unplanned Depreciation: depreciation resulting from unusual

circumstances, such as damage to the asset, that lead to a
permanent reduction in its value.
 Depreciation Key

The depreciation areas are identified in the system by a two-character

numeric key. You make this specification in the asset classes, and can
define it directly in the given asset master record.

The system allows you to define an almost indefinite number of

depreciation areas. This feature enables you to handle a large number of
different types of valuation in parallel.

You define the required depreciation keys per chart of depreciation.

 Elements of the Depreciation Calculation

Depreciation is calculated according to the depreciation key in the asset

master. The most important influences on the calculation of depreciation
are:

The value date of the document. It is used to set the depreciation start
date in the asset.

The depreciation key.

The depreciation calculation method is the most important feature of the

internal calculation key. It is used to carry out the different types of
depreciation calculation.
Transfers
 Transfers
Assets can be transferred within a company code or across
companies within the Group

Assets can be transferred in full or partially. Controlling

object assignment can be changed as can asset class.
 Asset Transfers
2

Asset transfers can be one of the following scenarios:

Transfer within Company Code (ABUMN)
1. Transfer within same Company Code
Eg. From one asset class to another

Intercompnay Transfer (ABT1N)

2. Inter-company transfers between companies in SAP
Eg. From one company to another
Period End Closing
Fiscal Year Change/Year-End Closing

Calendar
Calendar

Dec Dec
31 31
Fiscal Year Change Year-end closing
Fiscal Year Change

Fiscal Year Change Year-end closing

Asset
Assetvalues
values 1. Depreciation posting run
at
at fiscal
fiscalyear
yearstart
start Year
Year11
Transaction
Transaction 00 10000
10000 2. Year-end closing program
APC 00 10000 - Check:
APC 10000
Ordinary Can the year-end closing be carried out?
Ordinarydep.
dep. 00 3000
3000 --
Net - Maintenance of the last closed fiscal year per
Net book
bookvalue
value 00 7000
7000
company code

Periodic processing Closing reports

Fiscal year change 3. - Asset history sheet
- Asset list
-...

Asset values
at fiscal year start Year 2
Transaction 10000 0
APC 10000 10000
Ordinary dep. 3000 - 2100-
Net book value 7000 4900
 Points from Fiscal Year Change/Year-End Closing

 The fiscal year change program opens new annual value fields for each
asset.
 The earliest you can start this program is in the last posting period of
the old year.
 You have to run the fiscal year change program for your whole
company code.
 SAP provides you with a check report for year-end closing. It checks
whether the fiscal year change was completed for all assets, whether
depreciation was fully posted, whether errors exist for any assets.
 If the program finds no errors, it updates the last closed fiscal year for
each depreciation area.
Asset Reports …..

Summary of the main reports

 Standard Fixed Asset Reports
Standard reports are available via the standard SAP menu: “Fixed
Assets / Information System / Reports on Asset Accounting” Key
reports:

S_ALR_87011963 - 70: Asset Balances

A series of query programs based on different selection criteria.
S_ALR_87011979 - 82: Physical Inventory Lists
A series of query programs based on different selection criteria.
S_ALR_87012936: Depreciation on Capitalized Assets (Depn Simulation)
Simulated depreciation on assets/asset classes and Projects (can be
restricted to specific WBS elements).
S_ALR_87012026: Depreciation Current Year
Depreciation analysis by asset.
S_ALR_87012075: Asset history
Complete detailed history of each asset.