Example 2: Standardization of Fixed Asset Depreciation
Initial Situation
From a group perspective, different depreciations can be required for fixed assets than in the individual financial statements of the consolidation units.
In Asset Accounting (for example, FI-AA), you potentially perform the different valuations in parallel in various valuation areas:
The values valid from the perspective of the consolidation unit are managed in the valuation area for commercial law. They are posted to accounts of the item
Machinery & Equipment
and the itemDepreciations
.The values valid from the perspective of the group are managed in the valuation area in accordance with corporate policy. They are posted to accounts that are assigned statistical items.
Within consolidation, you can use reclassifications to adapt the values of the items Machinery & Equipment
to the group values.
The system posts the reclassification entry with posting level 10.
Sample Data
Consolidation Unit
| Item | Transaction Type | Value | Valuation Area
|
|---|---|---|---|---|
C3000 | 191500 (Machinery & Equipment) | 220 (Depreciations) | 200- | Commercial Law |
C3000 | 311950 (Depreciations on Machinery & Equipment) | -- | 200 | Commercial Law |
C3000 | 919150 (Statistical Item: Depreciations on Machinery & Equipment) | 220 (Depreciations) | 300- | Corporate Policy |
Prerequisites
You have entered the reported financial data.
You perform the reclassification before or after the currency translation.
In this example, the reclassification takes place before the currency translation.
Process Flow
Customizing
Define Document Type and Task
Define a document type with posting level 10 (standardizing entries).
Define a task for the reclassification.
Define Method Layout
Create a method layout for the reclassification, or use an existing layout with the following properties:
Without percentage, condition
With source
With substeps
Define in ... | Trigger | Source | Target |
|---|---|---|---|
... the Method | |||
Visibility | ¯ | ¯ | |
Detail screen | |||
Fast entry | Item | Item | |
... All Steps | |||
Visibility | ¯ | ||
Detail screen | Item Consol. Unit | ||
Fast entry |
You also need the characteristic
Consolidation Unit
for Source and Target. However, you do not need to specify these again since this is inherited from Trigger to Source and Target.Since you do not need the characteristic
Transaction Type
for all components of the reclassification, only select this when defining the methods as required (see below).
Define Method
Create a method with two steps:
In the first step, write off the depreciations posted in accordance with commercial law to the amount of 200 currency units
for the item Machinery & Equipment and
for the item Depreciations for Machinery & Equipment in the income statement
In the second step, post the depreciations posted in accordance with corporate policy to the amount of 300 currency units
for the item Machinery & Equipment and
for the item Depreciations for Machinery & Equipment in the income statement
Step 1:
Trigger:
Type of Trigger Data:
Transaction Data:
Cumulative
Key figure : Total in local currency
Trigger data:
Characteristics | Trigger | |
|---|---|---|
Consolidation Unit | = | C3000 |
Item | = | 191500 (Machinery & Equipment) |
Transaction Type | = | 220 (Depreciations) |
Target:
Characteristics | Target | |
|---|---|---|
Consolidation Unit | = | C3000 |
Item | = | 311950 (Depreciations on Machinery & Equipment) |
Step 2:
Trigger:
Type of Trigger Data:
Transaction Data: Cumulative
Key figure : Total in local currency
Trigger data:
Characteristics | Trigger | |
|---|---|---|
Consolidation Unit | = | C3000 |
Item | = | 919150 (Statistical Item: Depreciations on Machinery & Equipment) |
Transaction Type | = | 220 |
Source:
Characteristics | Source | |
|---|---|---|
Consolidation Unit | = | C3000 |
Item | = | 311950 (Depreciations on Machinery & Equipment) |
Target:
Characteristics | Target | |
|---|---|---|
Consolidation Unit | = | C3000 |
Item | = | 191500 (Machinery & Equipment) |
Transaction Type | = | 220 (Depreciations) |
Assign Document Type and Method
Assign the document type and the method to the reclassification task.
B. Execute Task
Execute the reclassification in the consolidation monitor. The system posts the following:
Step 1:
Item | Transaction Type | Value |
|---|---|---|
191500 (Machinery & Equipment) | 220 | 200 |
311950 (Depreciations on Machinery & Equipment) | 200- |
Step 2:
Item | Transaction Type | Value |
|---|---|---|
311950 (Depreciations on Machinery & Equipment) | 300 | |
191500 (Machinery & Equipment) | 220 | 300- |
Result
After the reclassification, the values for the item Machinery & Equipment
and the item Depreciations for Machinery & Equipment
are adjusted from 200 currency units to 300 currency units.