Research and Development Assets (SAP Library

Research and Development Assets

Use

With some assets used in research and development (R&D), you are allowed to depreciate 40% of the acquisition and production costs on the day of the acquisition. You then depreciate the net book value at the normal rate.

The system makes sure that you only apply this depreciation method to the assets that really qualify for this type of depreciation.

Features

Definition of R&D Assets

The R&D assets that qualify for this form of depreciation must:

Be used to research, develop, or test, products or raw materials that are used in the manufacturing process, or to improve the manufacturing process itself to reduce costs or increase output
Not have been used previously
Have a useful life of at least two years
Cost at least THB 100,000

System Checks

In the SAP System, you record all R&D assets in a separate asset class. When you create an asset master record in this class, the system checks the record to make sure that it meets all the conditions required by law. When you post an acquisition for the asset, the system also checks to make sure that the acquisition is above the stipulated limit.

Activities

Customizing

Depreciation Key

Create a depreciation key for R&D assets in Customizing for Financial Accounting (FI), by choosing Asset Accounting ® Depreciation ® Valuation Methods ® Depreciation Key ® Maintain Depreciation Key.

The third character in the key must be R, for example, THR1 or THR2.

The R informs the system that this key is only intended for R&D assets.

In the depreciation key control data, set Acq. only allowed in capitalization year to Yes.
Assign it the following calculation methods:

Dep./Int.	Phase	Base Method	Prd Cont.	Multiple	Ch. Method
Ordinary	1	0011	002	008	5
Ordinary	2	0017	003	005
Special tax	1	0023	004	006

Asset Class

The asset classes supplied with the standard system cover most standard requirements relating to Thailand. However, you must create a separate asset class for R&D assets. We recommend that you call the asset class TH800, as all of the functions relating to this class are based on this assumption.

To create an asset class, in Customizing for Financial Accounting, choose Asset Accounting ® Organizational Structures ® Asset Classes ® Define Asset Classes.

Depreciation Area

The Thai chart of depreciation comes with a tax depreciation area, 002. Since the R&D asset law is depreciation for tax purposes, record R&D depreciation in this depreciation area (see Chart of Depreciation).

Validation Checks

The standard system comes with two validation checks, J_H001 and J_H002. In both cases, we recommend that you create a copy of the checks and apply them to your company codes.

This system runs check J_1H001 when you create an asset master record. It:

Only allows you to assign the R&D depreciation key to asset masters in the R&D asset class
Only allows you to use the R&D depreciation key in the tax depreciation area
Checks that the asset's useful life is at least two years

Set up the check in Customizing for Financial Accounting (FI), by choosing Asset Accounting ® Master Data ® Define Validation.

The system runs check J_1H002 when you post an acquisition. It makes sure that the acquisition is worth at least THB 100,000.

Set up the check in Customizing for FI, by choosing Asset Accounting ® Transactions ® Acquisitions ® Define Validation.

Master Data

Create R&D asset master records in the R&D asset class, following the standard procedure, and assign the R&D depreciation key to the tax depreciation area.

Day-to-Day Activities

When you capitalize an R&D asset,

Post the acquisition to the R&D asset master record, following the standard procedure.

The system only allows you to post acquisitions worth more than THB 100,000.

Post depreciation of 40% manually, again, following the standard procedure.

Use transaction type 630, and enter the value as 40% of the asset's APC.