An inflation index contains data used for the inflation adjustment calculation. After defining an index, you can assign it to business objects, such as G/L accounts, that are to be adjusted for inflation.

Indexes consist of several parts:

In the header area, you define the general settings for an inflation index:

• 5 digit identification
• Explanatory text
• Indicator if the index is a composite index
• The format that the index is published in
• Version of values which is active
• Number of digits for reporting index values

If an index is a composite index, no index values can be maintained for it. The index is derived by combining index values of other indexes previously defined.

You can maintain several versions of index values for one index. The inflation adjustment programs use the index value version specified as the active version in the index header data. Therefore, it is important to maintain this entry.

In most cases, it is sufficient to use only one index version.

You can maintain index values for all indexes that are not marked as composite indexes. Which format you can maintain index values in depends on what format you select in the header data. The until date indicates the last day of the time period in which the corresponding index value is valid. The first day of the time period is the day that follows the previous entry in the table. Therefore, the first entry serves as a start date for the following periods.

An index value can be definitive or provisional. It is not allowed to have a provisional value after a definitive value. You can change a provisional value to a definitive value by setting the corresponding indicator. A change in the other direction is only allowed if the definitive index as not previously used for posting an inflation adjustment.

You can change definitive values only if they have not been used before. This ensures the consistency of the audit trail. If you have to change old values, you must create a new version of the index values.

If an index is marked as a composite index, then you do not maintain real values for it. Instead, you specify how the index is derived by combining other indexes with values. For each component of a composite index, you can specify by which factor should be taken into account.