Multi-Level Method (SAP Library - Asset Accounting (FI-AA))

Multi-Level Method

Use

Base methods for certain depreciation calculation methods (Stated percentage and Total percentage in concessionary period) use either a total percentage rate or a periodic percentage rate to calculate depreciation. You can divide these calculation keys into as many levels as you like. A level, in this sense, represents the period of validity of a certain percentage rate. This percentage rate is then replaced by the next percentage rate when its period of validity has expired.

Features

Period of Validity for the Individual Levels

You determine the validity period for the individual levels of a key by specifying the length of time in years and months. You can choose whether the defined validity period begins with

The capitalization date

The start date for ordinary or tax depreciation

The original acquisition date of the asset under construction
The changeover year

The defined time periods of a key always have a common start date. This means that the period from the start of one key to its end will overlap with the next period, which has the same start date but a longer validity period. Therefore, you have to enter the validity periods for the levels in cumulative form.

There is a special indicator you can use when you work with non-calendar fiscal years. The indicator allows you to specify that the definition of the levels applies to the fiscal year and not to the calendar year. However, be aware of the considerations involved when using shortened fiscal years (see Shortened Fiscal Years ).

Depreciation Percentage Rates

How you enter the depreciation percentage rate is dependent on the depreciation calculation method being used:

When using the Total percentage in concessionary period depreciation calculation method, you also have to enter the depreciation percentage rate in cumulative form (see example).

When using the Stated percentage depreciation calculation method, you do not enter the percentage rate in cumulative form.

The following example shows the definition of five levels, each one of which should last for a year. The Total percentage in concessionary period depreciation calculation method is being used. The depreciation percentage rates in the individual years are 60, 10, 10, 10, and 10%.

Validity period	Percentage
1 year	60
2 years	70
3 years	80
4 years	90
5 years	100

In addition, you can limit the levels according to specific acquisition years. This enables you, for example, to observe certain legal requirements that place time restrictions.