Changeover Key 
Changeover Key
Use
Certain depreciation methods necessitate a changeover to another method for mathematical reasons in order to depreciate the asset completely within the period of use. An example is the declining-balance method of depreciation, which never results in a net book value of zero. Apart from this, there may be legal regulations that allow or necessitate the changeover to another method.
Therefore, the system makes it possible to specify a changeover key for each calculation key, for use after the changeover. The changeover method specifies the conditions under which a changeover in the depreciation method should take place. The changeover key contains the depreciation method to be used after the changeover. Any calculation key can be used as a changeover key.
Features
Changeover Methods
You can set up the following changeover methods:
The changeover key is used to calculate depreciation in parallel to the normal calculation key. Changeover takes place as soon as the depreciation amount resulting from the changeover key is greater than that from the actual calculation key.
With this method, changeover takes place as soon as the net book value falls below the specified percentage of the acquisition value.
In the Customizing definition (Valuation) of company code specifications for a depreciation area, you can specify a global changeover amount in the local currency of the depreciation area. When the net book value falls below this changeover amount, changeover to another method takes place.
The straight line depreciation rate is calculated from the useful life and serves as a comparison with the net book value. If the net book value falls below this straight line rate, changeover to another method takes place.
You can also change over to another method when the planned useful life has expired. In particular, declining-balance depreciation is only defined for use during the useful life. If, for example, you were to post a post-capitalization after expiration of the useful life, you would have to use a different method.
With changeover at the end of the planned useful life, the switch to a specified changeover key takes place at an exact period. With other changeover methods, the changeover takes place according to fiscal years. The changeover criteria are checked with reference to the total depreciation for the year, and the depreciation for the entire fiscal year is either calculated with the original key or with the new changeover key.
For more information, see
Timing of the Change to the Shortened Year
Generally, the system determines if a changeover method is to be used only at the time of the carry-forward of annual values. The system determines at this point whether depreciation values should be determined using the original method (calculation key) or using the changeover method (changeover key in the calculation key).
There are two exceptions to this rule:
In this case, the system checks at the time of the initial acquisition, as well as at the time of the carry-forward of annual values, whether it should change to the changeover method.
If the end of planned useful life does not fall at the end of a fiscal year, the system determines the method that applies for each activity (either the year-end carry-forward or a transaction), based on the asset value date. However, the system does not calculate using two methods for one activity (for the time period before the end of the planned useful life and the time period after the end of the planned useful life). The determining factor for deciding which method is valid is whether the asset value date for the activity (year-end carry-forward or transaction) is before or after the end of the planned useful life. This means that a changeover after the end of planned useful life will only take effect, at a year-end carry-forward, after the fiscal year is over in which the planned useful life ended. For a transaction, the system determines on an individual basis whether the value date is before or after the end of the planned useful life.
The changeover to a different percentage rate or base value in the levels of a calculation key is not considered a changeover method in the above sense. The changeover to another level takes place at the exact period for each activity.
