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Entering content frameComponent documentation Depreciation Areas 

Use

You use depreciation areas to calculate different values in parallel for each fixed asset for different purposes. For example, you may require different types of values for the balance sheet than for cost accounting or tax purposes. You manage the depreciation terms and values necessary for this valuation in the depreciation areas of each asset. Since the system allows you to define up to 99 depreciation areas, you can manage many different types of valuation (Customizing: Valuation). Depreciation areas are grouped together, according to the requirements of a specific country or economic area, into a chart of depreciation (refer to

Chart of Depreciation).

Features

The depreciation areas are identified by two-digit numeric keys. You specify the asset-specific depreciation terms for every depreciation area belonging to the chart of depreciation. You enter the depreciation terms in the asset class or directly in the asset master record of the particular asset(see

Asset Master Record). This makes it possible, for example, for you to use straight-line depreciation for your internal accounting purposes and use declining-balance depreciation for the balance sheet.

Account Determination from Within the Depreciation Area

You can post both the asset balance sheet values and the depreciation values from the individual depreciation areas to separate balance sheet accounts or income statement accounts in the general ledger. You specify the accounts individually in the account determination key for each depreciation area. Define the account determination key in FI-AA Customizing and specify the key in the particular asset class. For more information on account determination see

Account Determination.

This graphic is explained in the accompanying text

Account Determination from Within the Depreciation Area

Usually you need to post more than one depreciation area in parallel to the general ledger if you are creating different financial statement versions. You can define any number of balance sheet versions per chart of accounts in FI (General Ledger) for this purpose. For each balance sheet account and income statement account, you specify in the financial statement version the balance sheet position or income statement position in which the account values should appear. You define the financial statement versions in FI Customizing ( Financial Accounting

® General Ledger Accounting ® Business Transactions ® Closing ® Document ).

Retained Earnings Account

The retained earnings account is an equity item in the balance sheet. This account shows the balance of all income statement accounts. If you are using different financial statement versions, then you also have to set up corresponding retained earnings accounts (FI Customizing: Financial Accounting

® General Ledger Accounting ® G/L Accounts ® Master Data ® G/L Account Creation). The income statement account type controls which income statement accounts balance to which retained earnings accounts. You enter the income statement account type in the master record of the income statement accounts. When you enter a retained earnings account, enter the income statement account type that the retained earning account should balance to. You can also define new income statement account types here.

Activities

You should determine the types of valuation for which you need different depreciation areas before you implement the FI-AA System. Then transfer these areas from the SAP reference chart of depreciation, or copy existing depreciation areas and redefine them. Delete the depreciation areas from the SAP reference chart of depreciation that you do not need.

It is also possible to open depreciation areas after the production start of the system (see

Subsequent Creation/Deletion of a Depreciation Area).

 

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