Valuation Methods

Valuation Methods

Use

You can define your own individual calculation methods for calculating asset values. These calculation methods are not hard-coded in the system. They are based on a number of flexibly-definable calculation keys. By defining your own calculation keys and control parameters, you can represent your specific depreciation methods.

There are pre-defined calculation keys and parameters in the system for the most commonly used depreciation methods.

Features

Depreciation calculation is based on the control parameters explained below, as well as on the planned useful life of the asset (in the asset master record):

The depreciation key contains all control amounts for the calculation of planned annual depreciation. You can enter a depreciation key in the asset master record in each depreciation area (see Definition of the Depreciation Key).

The most important part of the depreciation key are the internal calculation keys for the calculation of the different types of depreciation (ordinary and special depreciation, and interest). Of particular importance is the depreciation method, which is defined in the internal calculation key (see Internal Calculation Key (Control Functions)). In addition, you can specify the period control for various transaction types in the internal calculation key (see Period Control).

Special functions enable you to take into account a cut-off value/scrap value (see Cut-Off Value).

Note that changing the Customizing definition of the depreciation keys does not automatically lead to a correction of depreciation values that have already been calculated for individual assets. For that to happen, you have to execute a recalculation of depreciation (under Periodic processing).