Chart of Depreciation (SAP Library

Chart of Depreciation

Definition

Use

When you create a company code using the template for Venezuela, the system assigns it chart of depreciation 1VE, which follows Venezuelan accounting requirements.

Structure

Chart of Depreciation

Depreciation area	Use	Currency
01	Book depreciation (unadjusted)	Local
03	Inflation adjustments	Local
04	Book depreciation (adjusted)	Local
15	Tax depreciation	Local
30	Consolidated book depreciation	Local
31	Consolidated book depreciation	Group
32	Book depreciation	Group
33	Book depreciation	Hard
34	Inflation adjustments	Group
35	Inflation adjustments	Hard

These depreciation areas cover different inflation and currency requirements, as follows:

Book depreciation before and after adjustment for inflation

Depreciation area 01 is used for recording depreciation before inflation adjustment. Area 04 is used for adjusted depreciation. Area 03 is used for the inflation adjustments only, that is, the difference between the unadjusted and adjusted values.

Example

You buy a machine for VEB 1,000,000. In the first year it depreciates by VEB 100,000, giving a net book value of VEB 900,000. Inflation is running at 20%. The entries are as follows:

Area	Acquisition cost (VEB)	Depreciation (VEB)	Net book value (VEB)
01	1,000,000	100,000	900,000
03	200,000	20,000	180,000
04	1,200,000	120,000	1,080,000

Book depreciation in different currencies

The information in depreciation area 01 is duplicated in depreciation areas 32 and 33, with the difference that these areas are kept in your hard currency and group currency respectively. Whenever you post any changes in depreciation area 01, the system automatically updates areas 32 and 33.

Inflation adjustments in different currencies

Similarly, the system automatically maintains two copies of the depreciation area that you use to post inflation adjustments in your local currency (02): area 34 shows the adjustments in your group currency; area 35 in your hard currency. However, all adjustments in these areas will be zero, as inflation only affects the local currency.

See also:

Currency