Account Determination for Depreciation Expense 

Use

When an asset accountant executes a depreciation run, the system automatically posts the depreciation expense to the correct accounts.

The law requires you to post depreciation expense to different accounts depending on (a) the asset class (for example, buildings or machinery), and (b) which functional area it belongs to, for example:

·        Production

·        Research & Development

·        Sales & Marketing

·        Administration

For an illustration, see the example below.

Activities

Carry out the following IMG activities, and maintain the asset master records as described below.

Customizing

In the system, the different kinds of assets are represented using asset classes, so create an asset class and account determination key for each, as described in Asset Class.

Entered the accounts that you want to record the depreciation expense on, in Customizing for Financial Accounting (FI), by choosing Asset Accounting ® Integration with General Ledger ® Define G/L Accounts for Depreciation Expense (Turkey).

Activate the implementation Change Depreciation Expense Accounts (Turkey) (TR_REALLOC_01) of the Business Add-In Change of Line Items in Asset Document (BADI_FIAA_DOCLINES). This implementation determines which G/L accounts to post the depreciation expense to, using the entries that you have made in the IMG activity.

Master Data

Enter the cost center in each asset master record, on the Time-Dependent tab.

Example

On January 1, 2004, a company buys two computers:

·        A PC for the human resources department, for TRL 100,000,000

·        An Apple for the marketing department, for TRL 200,000,000

Both computers are to be depreciated over five years, using straight-line depreciation.

On December 31, 2004, the asset accountant carries out a depreciation run. The system makes the following postings ­– note that the depreciation expense is posted to different accounts, depending on the function area: