Workshop

Fixed Asset Accounting

Ali Nasrullayev, FI/CO Consultant
January 6, 2021
Agenda

 Discussion topics

 Fixed Asset Master Data

 Acquisition

 Asset Under Construction

 Transfer

 Retirement

 Write-up

 Reverse

 Depreciation

 Fixed Asset Reports

 Year Closing
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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

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 Fixed Asset Master Data

Using the asset master record, you can create, edit, and manage the master data needed for
Asset Accounting.

General Master Data : This part of the master record contains concrete information about the
fixed asset.

General information (description, quantity, and so on)

Posting information (for example, activation date)
Time-dependent assignments (such as, cost center, fund center)
Information for plant maintenance
Information on the origin of the asset (vendor, manufacturer, country)
Physical inventory data

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 Asset Class

Balance
A L sheet

General
ledger
accounts

Buildings Vehicles Assets under Fixtures and

construction fittings
Asset
classes

Asset
master
records

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Data for Calculating Asset Values

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Asset Acquisition - Integration
100 110
Acquisition Acquisition in-
purchase house
production

Assets Accounts Payable

Aqcuisition with Vendor
Fixed Asset Vendor  Asset transaction integrated
100 100 with Accounts Receivable or
Accounts Payable
)Only for direct Asset purchases(
No PO

Assets Accounts Payable

Fixed Asset Vendor Aqcuisition with MM-PO

100 100
 Asset transaction posted
MM
from Materials Management
)MM(
Asset Acquisition – MM Integration
Purchase Requisition
op
ti on
al

Building
Purchase Order
required
Goods Receipt
ti on
Valuated Non-Valuated
t al i za
a pi
C
or
Goods Receipt

Invoice Receipt
Asset under Construction

Assets under construction are a special form of tangible assets. They are usually displayed as a
separate balance sheet item and therefore need a separate account determination in their asset
classes. It is not always that fixed assets are acquired in their complete form, sometimes they
are built progressively over a period of time. When Fixed Assets are being built over time, they
are treated as assets under construction, and then they are capitalized or settled to a fixed asset
(s) or other settlement objects, upon completion.

Characteristics of an AUC :

They are built over time and settled to a Fixed Asset (s) or other settlement objects (Internal
orders, WBS, etc.) upon completion.

Mostly not depreciated during the AUC stage. This is true for most countries.

The best approach is to have a separate asset class for assets under construction and
maintain an asset master record for each AUC.

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Asset under Construction

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Transfer

Using asset transfer function, you transfer a fixed asset, or an asset component,
to a different asset master record. The target asset has to be in the same company
code as the sending asset.

Transfer may be necessary for one of the following reasons:

 An asset was created in the wrong asset class. Since you cannot change the asset class
in the asset master data, you have to transfer the asset to a new master record.

 You split up an asset or move part of an asset (transfer from asset to asset).

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Retirement

Asset retirement is the removal of an asset or part of an asset from the asset
portfolio. Depending on organizational considerations, or the business
transaction which leads to the retirement, you can distinguish the following types
of retirement:

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

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Write-up

A write-up is generally understood to be a later change to the valuation of an

asset. Write-ups increase the book value of a fixed asset. During a fiscal year
change, the write-ups posted up to the year-end are balanced with the depreciation
amounts . This change can take different forms, depending on the reasons for the
change.

Common reason for write-up:

The value adjustments (depreciation) that you calculated in the past were too high.
You must now correct this error using a write-up in the current fiscal year.

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Reverse

Reverse Asset posting - This transaction is used to reverse an asset posting . If the
posting generated from Asset accounting, you cannot use FB08 (which used for accounting
documents)  to reverse this posting. You will need to use AB08. you might have entered the
wrong amount or used an incorrect asset etc. hence you need to reverse the posting. When
you call up the reversal transaction, the system shows you all the transactions for the asset.
Select the transaction you want to reverse, and choose the Reverse function.

The following postings cannot be reversed in Asset Accounting. They have to be

reversed in the integrated application in which they were posted:

Acquisition with vendor (Accounts Payable)

Acquisition with purchase order (goods/invoice receipt)

Retirement with customer (Accounts Receivable)

Stock withdrawal (Materials Management)

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Depreciation

Depreciation is a topic of asset accounting. In a nutshell, it is an asset's gradual fall in book

value. An asset may fall in value as its economic usefulness declines over time.

Two forms of depreciation are available in SAP:

Ordinary depreciation Planned depreciation

Unplanned depreciation

Ordinary Depreciation: Planned reduction in asset value due to normal wear and
tear.
Unplanned Depreciation is the loss in value due to a sudden event, such as a
natural disaster. Depreciation resulting from unusual circumstances, such as damage
to the asset, that lead to a permanent reduction in its value.

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Depreciation

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Fixed Asset Reports

Individual Asset : Asset Explorer

Asset List : Sample for Address Data for Asset

Asset Balances : by Asset Number, by Asset class, by Cost Center, by Plant, by Location

Physical Inventory Lists : by Asset class, by Cost Center, by Plant, by Location

Depreciation Current Year

Asset history

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

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Thank You!

Contact information:

Khayal Gojayev
Project Coordinator
[email protected]