Split Revaluation of Depreciation (SAP Library)

Split Revaluation of Depreciation

Use

In some countries, you are required to split the revaluation of the current year's depreciation amounts into two components (as illustrated in step 3 of the asset revaluation process) and post them to separate accounts:

The revaluation of the current month's depreciation
The revaluation of the depreciation amounts from previous months in the current year

It does not have any effect on the revaluation of depreciation amounts from previous years.

Prerequisites

To activate the split, you select the indicator in the inflation method. You must also specify which G/L accounts you want to use.

Example

This function is best explained using the sample asset revaluation process.

February

At the end of February, the system revaluates the drilling equipment from UNI 12,000 to UNI 13,200.

It also revaluates the monthly depreciation from UNI 100 to UNI 110. This figure breaks down into the unadjusted depreciation on the APC at UNI 100 and the revaluation of the depreciation amount, UNI 10.

That means that on 28 February the system posts:

The revaluation of the asset's APC (UNI 1,200)
The unadjusted depreciation for February (UNI 100)
The revaluation of the depreciation for the current month (UNI 10)
The revaluation of the depreciation for previous months (UNI 10)

On 31 January you had already posted UNI 100 depreciation on the asset. The posting here serves to increase this amount to UNI 110, which is necessary in order for the machinery to be depreciated over the asset's useful life.

March

In March, inflation is again running at 10%, which means that the asset is now worth UNI 1,320 more:

UNI 13,200 + UNI 1,320 = UNI 14,520

This takes the monthly depreciation up to UNI 121:

UNI 14,520 ÷ 120 months (10 years) = UNI 121

This represents an increase of UNI 21 on the original monthly depreciation amount, and an increase of UNI 11 on the depreciation amount adjusted for February. So on 31 March the system posts:

The revaluation amount on the asset's APC (UNI 13,200 × 10% = UNI 1,320)
The unadjusted depreciation for March (UNI 100)
The revaluation of the original depreciation amount for the current month (UNI 21)

This sum increases the original depreciation for March (UNI 100) to UNI 121, the amount now required to depreciate the asset.

The revaluation of the depreciation amount for previous months (UNI 11 ´ 2 = UNI 22)

This sum, UNI 11, increases the deprecation already accumulated in January and February (UNI 100 + UNI 10 = UNI 110) to the necessary amount (UNI 121)