Activation of New Depreciation Area in Assets Accounting for IFRS

New Depreciation Area can be created with report “RAFABNEW”. Go to SE38 and read documents in details.

SAP Relevant Notes

1. 430618 (Procedure for setting up new depreciation area)
2. 301113 (Restrictions of RAFABNEW)
3. 421549 (RAFABNEW: Error with closed fiscal years)

What depreciation terms and values does the new depreciation area receive?

Values and depreciation terms are adopted without change from the area defined as the reference depreciation area in Customizing, unless the new area is not active in the given asset class.

» Read more: Activation of New Depreciation Area in Assets Accounting for IFRS

• Create Investment program  (IM01 – Create)
• Create top node (IM11 – Create Top Position)
• create position id (IM22 – Change)
• Put appropriate budget on position id (IM32 – Edit Original)
• Create an internal order with internal order type CAPX- Capital Investment Orders (KO01 – Create)
• System will ask to create AuC assets at this time. We need to create AuC Assets here. It will be used to post the value from CWIP account at the month end.
• Assign this order to appropriate investment program node. (IM32 – Edit Original)
• Change the status of I/O from “INPL- Initial Planning by Locations” to “INPR- In-Principle Sanction” (KO02-Change)
• Allocate the appropriate budget to this I/O (T-Code IM52)
• Change the status of I/O from “INPR- In-Principle Sanction” to “30 APPR Board Note Appro” and from “30 APPR Board Note Appro” to “40 EXEC Execution Phase”. (KO02: Change)
• Create PO with reference of this I/O and give the expense GL account (ME21)
• Goods receipt (MIGO) with reference to PO and refer the vendor excise invoice created in above step.
• At this time cost element “CWIP account” will be posted with reference of I/O. (KOB1 Line Item display for Order)
• At the month end we need to run the settlement for the I/O through KO88. It will post the value to AuC and credit the “CWIP account”. It makes the CWIP account zero at the month end.
• Create an assets master for final settlement. (AS01)
• To settle the value from the AuC to Final asset we need to run the order settlement once again and at this time we need to give the final assets in the settlement rule for I/O. It will post the final assets and credit the AuC. (KO88 – Line Item settlement)
• At the month end depreciation need to be run (AFAB – Execute)
• Do retirement for transferee asset.

• To capitalize fixed assets like Plant & machinery, buildings, Furniture & fixtures, IT assets etc. by routing through CWIP with a budget availability check
• To capitalize assets which are constructed internally.
• To capitalize all associated costs related to procurement of assets.
• To account for any exchange gain/loss.

Process Flow

This method is used for capitalizing assets that are constructed and / or procured like Plant and Machinery, Building, Land Development etc. under any project or otherwise.

To be process flow for capitalizing the assets under this method:

» Read more: Assets Capitalization routing through CWIP or AuC with IO

SAP Assets Acquisition from other division or affiliated company, Process Flow

• To account for assets acquired from other divisions within organization
• To account for assets acquired from other affiliated/subsidiary company

Process of Assets Transfer

1. In case any asset is acquired from other divisions of Company or Organization, who are using Asset Accounting in SAP or otherwise, to be process flow is elaborated in the document on transfer of fixed asset.
2. In case any asset is acquired from other affiliates or subsidiaries of Company or Organization, to be  process is as follows:

• • Create internal Order, incorporating approval reference for such acquisition.
  • Create the asset master in the receiving company code with following details:
  • Asset Class
  • Description of Assets
  • Location
  • Sub-Location
  • Business Area
  • Internal Order number to relate to sanction
  • Cost Center to capture depreciation
  • Relevant Insurance data
  • Depreciation data for the relevant depreciation areas
  • Depreciation keys

» Read more: Assets Acquisition from other division or affiliated company

Message AA416 Retirement of old assets data not possible (No existing old assets data)

Check : Are you using Group Assets ? If yes,

Check the values on your group asset consistent in relation to the assigned individual assets. With other words if your assigned individual asset(s) have accumulated APC values the group asset should have accumulated APC values, too.

SAP strictly recommends to assign NOT to one group asset single assets with postive and negative accumalted APCs values. Negative and positive individual assets should then be managed separately on one group asset in each case.