ASSET MANAGEMENT IN SAP
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Agenda
 Assets Accounting
 Types of Assets
• AUC Assets
• Fixed Assets
 Asset Life Cycle
• Asset Master
• Asset Acquisition
• Asset Transfer
• Asset Retirement
 Retirement with scrap.
 Retirement without revenue.
 Retirement with revenue.
 Month End Activities
• Depreciation Run
• Periodic posting
 Year End Activities
• Fiscal Year Change
• Yearend closing
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ASSETS ACCOUNTING
Asset Accounting in the SAP system is used for managing and monitoring Under Construction and fixed
assets. In Financial Accounting, it serves as a subsidiary ledger to the general ledger, providing detailed
information on transactions involving Assets.
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TYPES OF ASSETS
There are 2 types of Assets
1. Assets under construction : AUC can be created from different ways
 Investment Measure
 Purchase Order
 Production Order
2. Fixed Assets : Values of fixed assets can be posted through
 Acquisition from vendor
 Purchase Order
 Settlement an AUC and transfer to a final asset
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ASSETS UNDER CONSTRUCTION
Definitions
Commitment : from a legal
obligation (contract, purchase
order) which engages the
company to a third party.
Capitalizations : corresponds
to the Good Receipt (MIGO).
Can be done before the
physical receipt of product if
the ownership transfer takes
place at the load.
Commissioning : transfer
from
Asset
Under
Construction to Final Asset
and activation of asset
depreciation postings.
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.
• SAP allows posting ‘down payments’ to AuC. It is also possible to enter credit memos for AuC even after its complete
capitalization, provided you are managing this asset class and allowing negative APC (Acquisition and Production Costs).
• The IM (Investment Management) module helps to manage internal orders/projects for AuC.
• Depreciation is not allowed for AuC. It is necessary to use the depreciation key ‘0000’ to ensure that you are not calculating any
depreciation for AuC. But you can continue to have special tax depreciation and investment support even on these assets.
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Fixed asset - a subsidiary ledger to the general ledger in financial accounting
for SAP. Assets are capitalized and included in the company Balance Sheet as
assets, rather than written off to Profit and Loss account as expenses.
FIXED ASSETS
Net Book Value - the value of an asset in the accounting book which is
calculated using the historical cost of the asset less any accumulated
depreciation. If the asset has been revalued upwards or downwards, the
accumulated write-up or write-off is also taken into account in the calculation of
the net book value.
FIXED ASSET
Acquisition and Production Costs - the costs involved in obtaining an asset,
whether it is purchased externally, or produced internally.
ASSET
CLASS
Depreciation
Area
Depreciation
Type
Account
determination
Low Value Asset - an asset for which the acquisition and production costs (less
included sales tax) does not exceed a legally predefined amount. Typically, a
low value asset can be completely written off within the period in which it is
acquired.
Useful Life - a period during which an asset is expected to be usable for the
purpose for which it was acquired. Useful life may, or may not, correspond with
the asset's actual physical life, or economic life. Before the end of an asset’s
useful life, the asset should be written off completely.
Capitalization - the process of recording an acquisition and production cost as
an AUC asset (written off as depreciation over several accounting periods),
instead of an expense (charged against earnings in one accounting period).
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Asset Value Date - the date of an asset transaction from the accounting point of view. For example, the date of
asset capitalization or retirement. The asset value date can be different from the posting date and document
date, but it must be within the same period as the posting date.
Depreciation - the reduction in the book value of an asset over its useful life for both tax and accounting
purposes. Depreciation would be included with the company expenses.
Depreciation Area – a dimension showing the valuation of an asset according to a particular accounting
standard. For example, individual financial statements, or balance sheets for tax purposes. You can set up
different depreciation areas to calculate different values in parallel for each asset.
Depreciation Type - a label for classifying depreciation based on the reason for the depreciation. SAP allows
you to set up depreciation types using several depreciation methods. For example, Straight Line, Straight Line
Period Control, Declining Balance and so on.
Salvage Value - the estimated value of an asset at the end of its useful life. The depreciation of an asset cannot
cause the asset value to fall below the salvage value.
Retirement - the removal of an asset or part of an asset from the asset portfolio.
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ASSET CLASS
ASSET CLASS
Function of Asset Class
Screen Layout
Number
Assignment
Account
Allocation
Every asset has to be assigned to exactly one asset class. The asset class is used to assign
the assets (their business transactions) to the correct general ledger accounts. Several asset
class can use same account assignment. The most important tasks of the asset classes are
●The asset class provides default values to all asset master records in the class.
●Controls the screen layout of Asset master,
●The assignment of asset numbers can be controlled by the asset class.
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ACCOUNT DETERMINATION
One of the most important functions of the asset class is to establish the connection between the
asset master records and the corresponding accounts in the general ledger in Financial Accounting.
This connection is created by the account determination key in the asset class
The below GL accounts is an example used in one project.
Area
01
Acquisition values
Accumulated depreciation
Depreciation
928*
968*
9675*
28*
68*
675*
Local
20*/21*/23*
90
Group
xx
Reval
920*/921*
929*
969*
xx
Inflation
920*8/921*8
928*
968*
9675*
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Chart of depreciation/Depreciation Area
Chart of depreciation: Charts of depreciation are used in order to manage various legal requirements
for the depreciation and valuation of assets. These charts of depreciation are usually country-specific
and are defined independently of the other organizational units.
Depreciation Area: Depreciation areas are used to calculates different values in parallel for each fixed
asset for different purposes. You manage the depreciation terms and values necessary for this
valuation in the depreciation areas of each asset
An example where you can see 4 depreciation areas.
01-Book Depreciation (affiliate enters the useful life according to the local rules)
02/03- Tax Depreciation
32- Group Depreciation for USD currency
90-Group Depreciation for local currency (useful life defined by the Group rules)
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Depreciation Keys:
The depreciation key contains the value settings which are necessary for determining depreciation
amounts. It represents a combination of calculation rules, which are used for the automatically
calculated depreciation types
• Ordinary depreciation
• Special depreciation
• Imputed interest
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ASSET LIFE CYCLE
 Acquisition : Acquisition occur when a company acquires a new asset.
 Transfer : Transfer of asset can be Intracompany transfer(within the same company code )
based on business requirement.
 Depreciation : Asset depreciation is reduction in the book value of an asset due to its use over
time or Due to legal framework for taxation reporting.
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 Retirement and disposals :
Asset retirement is the removal of an asset or part of an asset from the asset portfolio. This
removal of an asset (or part of an asset) is posted from a bookkeeping perspective as an asset
retirement. Depending on organizational considerations, or the business transaction which leads
to the retirement, you can distinguish the following types of retirement:
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ASSET PROCESS FLOW
•
•
•
•
•
•
•
Master data creation/change(Transaction AS01/AS02)
Acquisitions posting to asset (Transaction F-90)
Transfers
Depreciation/Periodic postings
Retirement
Period end closing
Year-end closing process.
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MASTER DATA CREATION/CHANGE (TCODE.AS01/AS02)
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ACQUISITIONS POSTING TO ASSET (TRANSACTION F-90)
Acquisition from purchase with vendor screen
Transaction type:100 for
external acquisition
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ASSET EXPLORER (TRANSACTION -AW01N)
Asset Explorer before posting
Asset Explorer after Acquisition
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ASSET TRANSFERS (T-CODE ABUMN)
Transfer within company code from one asset to the other
The asset 43494 is transferred to new asset 43495 in the same company code
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RETIREMENT (SCRAP) PROCESS (TRANSACTION ABAVN)
Perform this procedure when a Capital Asset Disposal and Transfer form has been received, and an asset
needs to be scrapped
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RETIREMENT WITH REVENUE (F-92)
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AW01N Before posting
AW01N After posting
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MONTH END ACTIVITIES
•
Depreciation Run(AFAB): Depreciation is the systematic reduction in the recorded cost of a fixed asset. The
reason for using depreciation is to match a portion of the cost of a fixed asset to the revenue that it generates; this
is mandated under the matching principle, where you record revenues with their associated expenses in the same
reporting period in order to give a complete picture of the results of a revenue-generating transaction. The net
effect of depreciation is a gradual decline in the reported carrying amount of fixed assets on the balance sheet.
Every asset transaction in the Asset Accounting (FI-AA) component immediately causes a change of the
forecasted depreciation. However, an asset transaction does not immediately cause an update of the
depreciation and value adjustment accounts for the financial statements. The planned depreciation is posted
directly to Financial Accounting (FI) when you run the periodic depreciation posting run. This posting run posts
the planned depreciation for each posting level for each asset as a lump sum amount
•
Periodic posting(ASKB): Periodic asset posting will update acquisition and depreciation in depreciation area other
than area 01 which are maintained as post "APC and depreciation on periodic basis” The purpose of periodic
posting is to rectify the difference between the ledgers due to parallel depreciation area.
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DEPRECIATION POSTING (TRANSACTION AFAB)
Initially execute the transaction AFAB in test run
mode in order to know if depreciation run has any
errors to be addressed.
Important point: Depreciation Run always executed
in background mode only.
The Planned Posting Run is the standard periodic run to post
planned depreciation. This should be used when the last
depreciation run was successful, and it’s time to carry out the
depreciation run as part of the new period-closing process.
The Repeat run is used to repeat the posting run
within the period last posted. Repeat would be used
if changes have been made after the period
depreciation run has been posted.
If posting run terminated for technical reasons, and
changes made already made to the database, the
depreciation run report must be begin in restart mode.
The Unplanned Posting run allows posting outside
of the normal processing cycle(By setting this
indicator, the system does not check for the
connection to the previous period and allows
skipping over periods
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Test run will help you to find out errors with the error log.
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Issues observed during depreciation run(AFAB)
Error message : “Cost center 1000/GN111S0098 is blocked in the primary cost postings to the period”.
Reason: The error message is caused as the cost center is blocked for posting. In order to post the
depreciation to the cost center.
Solution: Go to Transaction code KS02 and unblock the cost center: GN111S0098 by unchecking as
per below screenshot.
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Error message : Last record program interrupted (restart in period 2016 007)
Reason: Generally when a depreciation has executed in test mode you can get a message stating last
record program interrupted. It is due to depreciation run was not completely posted in the previous period.
though you have already executed depreciation for the previous period, It may be of several reasons:
• Acquisition for the previous period made after the execution of depreciation.
• Depreciation run interrupted and not all the assets were depreciated.
Solution: You need to execute the deprecation by selecting the radio button restart as per below
screenshot
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PERIODIC POSTING - ASKB
Initially execute the transaction ASKB in test run mode in order to know if depreciation run has any
errors to be addressed.
Important point: Periodic posting are always executed in background mode only.
Start the periodic posting report with
the "Restart posting run" option in
order to update the missing
documents.
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Issues observed on Periodic posting.
Error message : Revaluation acquis. and production costs' could not be found.
Reason: The user posted revaluation amount to the 90 Dep area, but the GL accounts are not maintained in AO90 transition to the 90 dep.
Solution: To resolve the issue need to maintain GL accounts for 90 dep in AO90 transaction. But this is a customizing task and the validation of
BPO is needed. Please create an OM&GA ticket.
Difference in FI-AA Balances.
In several scenarios we find the differences in FI-AA balances. FI-AA differences may occurs
Depreciation not been posted(Transaction code AFAB)
ASKB not being executed after Sales, Transfer, Scraping,(Due to which posting of values in GL accounts related to depreciation Area 90 will
not takes place).
Manual Posting on accounts 28*(All other are reconciliation accounts or in automatic postings only)
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YEAR END ACTIVITIES
Fiscal year change(AJRW): From the point of view of the system, a fiscal year change is the opening of a
new fiscal year for a company code. At the fiscal year change, the asset values from the previous fiscal
year are carried forward cumulatively into the new fiscal year. Once the fiscal year change takes place,
you can post to assets using value dates in the new fiscal year. At the same time, you can continue to post
in the previous fiscal year. You find the fiscal year change program under Periodic processing .
Year end closing(AJAB): The year-end closing is an annual balance sheet, an annual profit and loss
statement, and an appendix with additional information (annual report), which has to be created to meet
the particular legal obligations in each country. Before you can close a fiscal year in Financial Accounting
from a bookkeeping perspective, you have to carry out preparatory measures in Asset Accounting.
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YEAR-END ACTIVITES IN ASSET ACCOUNTING
Fiscal year change (AJRW): A fiscal year change is a technical procedure. The asset values from the
previous fiscal year are carried forward cumulatively into the new fiscal year. Once the fiscal year change
takes place, you can post to assets using value dates in the new fiscal year. At the same time, you can
continue to post in the previous fiscal year. Always execute in background mode only.
You can check closed fiscal year in the transaction OAAQ.
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ASSET ACCOUNTING YEAR-END CLOSING (AJAB)
Year end closing for asset accounting has to be performed, before closing of the financial accounting for the year.
Prerequisites for closing: All the periodic posting such as depreciation run, periodic posting ASKB and FI-AA reconciliation(
ABST2) has to be completed
Execution of fiscal year change(AJAB):
Only the test run can be executed in foreground to find out errors. Once the test run is passed without errors, AJAB can be
scheduled by unchecking the test run in background mode.
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There are no errors,
so you can proceed to
execute AJAB in real
mode
Execute the production run in background
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Error Message: Depreciation not posted completely.
Reason: The acquisition amount posted for the assets for previous period after the execution of
depreciation run and again depreciation was not executed.
Solution: Go to AFAB transaction and execute the depreciation for the assets in Restart mode and then
schedule AJAB in background.
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THANKS
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