Amortization of assets

Hi to All,
I have intangible assets in my Company code and i want to assign amortization accounts to them
In integration with GL i come across balance sheet and depreciation accounts
Where are the settings were i can actually assign amortization accounts .
Thanks in advance
tanuja

think you did already...
depreciation = amortization

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Amortization calculation for an asset

Dear All,
I received a requirement from the users to do amortization for a fixed asset. Can somebody please help me to understand the business process of amortization and what is the requirement to do amortization for a fixed asset since I do not have prior experience on this.
I am looking forward your help
Thanks & Regards
Ramki

Hi Ramki,
I'm not sure if you really mean amortization:
The process of reducing the value of intangible assets by spreading the costs over the useful life of the asset.
This can also be achieved by making a value adjustment on the balance sheet key date. From a consolidation point of view, the amortization of goodwill during the first consolidation is relevant. Typically, the procedures for amortization are governed by external regulatory bodies.
Or if you mean depreciation:
http://help.sap.com/saphelp_46c/helpdata/de/4f/71fd71448011d189f00000e81ddfac/frameset.htm
hiere you'll find under the 4th link a complete documnetation
regards Bernhard
Edited by: Bernhard Kirchner on Oct 22, 2010 12:18 PM

Use AM module to post pre-paid expense asset amortization (Straight Line)

I'm new to this area and please explain in detail what I'm supposed to do for this requirement.
The requirement: Use AM module to post pre-paid expense asset amortization (Straight Line amortization)
The implementation of this capability will allow Property Accounting to enter prepaid expenses into the FA subledger and have SAP automatically post monthly straight line amortizations as part of the month-end process. The idea is to configure a new asset class for "prepaid Leasing Commission" assets that will have the following GL accounts.
GL Account: 159001000
Cost Center: 159001000
Profit Center: SN09120001
Non-Reconcilition Account: 159002000
Expense Account: 890304000
What I have done so far:
I have created an asset and have created a Cost center and assigned the profit center to that. I have also created a non-recon account. The question is where do I use the Non-recon account and the expense account and have the SAP post it automatically? Will be helpful if you can provide the steps I should be following and the tcodes for this. Thanks for the help.

Hi,
I would recommend that you go through the IMG of Fixed Asset Accounting and complete the FI-AA configuration.
You store the accounts to be used in postings in the node "Integration with General Ledger".
Requirements to use cost center as accounting object are documented in the SAP Help Portal as well as in note 684659.
Regards,
Markus

Amortize Adjustment Flag in Fixed Assets

Hi,
We have a requirement where we need to get all the assets for which the Amortize adjustment Flag is set. When we query a asset from Asset Workbench and then click on Books to see Cost, NBV etc. details,there is an option to make check mark against Amortize Adjustment. I want know which table hold value for this update.I see from the front end form that FA_BOOKS_V is being used but am not able to find this field in the table.
Regards
Aman

Hi,
You isolate assets where an amortized adjustment is made by checking fa_transactions_headers where (transaction_subtype = 'AMORTIZED' OR transaction_key = 'UA'). Any asset/book combination that meets that has an amortized adjustment. Since one can't make any expensed adjustments after an amortized adjustment, you don't have to check for a specific transaction. Just check where the condition exists.
Regards.
Ata ur Reman
Thanks for Halim (My Oracle Support Community)

What is Asset Construction Management & Amortization

Hi
what do you mean Asset Construction Management & Amortization or definition of both in SAP PS.
Regards
Ranjit

Assets under construction are a special form of tangible assets. They are usually displayed as a separate balance sheet item and therefore need a separate account determination in their asset classes.
Fixed asset that is in the process of being completed at the time the balance sheet is being produced.
In general, assets under construction are shown as a separate balance sheet item for the enterprise. Assets under construction can be managed for bookkeeping purposes in the FI-AA component using asset master records in special asset classes.
To also benefit from management accounting functions that go beyond the asset accounting level, you can use capital investment measures in the Investment Management (IM) component. Investment measures can be managed in the form of internal orders or projects.
For details please refer this link
http://help.sap.com/erp2005_ehp_04/helpdata/EN/4f/71daf9448011d189f00000e81ddfac/frameset.htm
Regards
Nitin

Transfer posting (OASV) issue for the existing Intangible Assets

Hi SAP Experts,
In our system the APC and Acc. Dep. for ord. dep. has maintained the same G/L Account (A090) so due to this in Fin. Statement it shows the Net Book Value. Now, our client wants to migrate to IFRS, as per this it has to show like ( Intangible Assets - Acc. amortization - Acc. Impairment Loss). Now, I have created new account i.e. 'Accumulated Amortization for Intangible Assets A/c and removed the old G/L A/c (the one which is same for both APC and Acc. Dep.). Now, the old G/L has the APC and Acc. Dep. values so I need to transfer the Acc. Dep. from old G/L to New G/L A/c by using OASV (Transfer posting).
If I make the transfer posting like (the both G/L Accounts are Recon. A/cs)*
      Debit Old G/L A/c    - xx,xx,xxx
      Credit New G/L A/c - xx,xx,xxx
Is it any impact on the values (Intangible Assets) Dep. Area wise? Since, APC and Acc. Dep. already posted to old A/c up to this point of time. Another doubt is, while posting the above entry shall I need to switch off (Reset) Recon. A/c for this Intangible Assets? OR without Reset Recon. A/c can I post this transfer posting? Is this correct procedure or other than this is there any other alternative?
we have 9 Dep. Areas out of which 3 Dep. Areas have posting indicator as '1'. In that out of 3 Dep. Areas one Dep. Area namely 'Impairment Loss' is there but there are no positings till now. After config. change it should allow ABIF tr. that we completed already.
Could anyone explain why this 'Investment Support' Dep. Area (Impairment Loss) doesn't allow APC values by default?
Thanks in advance.
Best Regards,
Sri.

Hi Sri,
Let me clarify your points individually.
1) From system the prospective, it does not make any diff in functionality for a tangable asset or an intangable asset.
2) Add the new GL account in the respective account dtermination as a balance sheet account for accum dep. (while adding, the GL account should be as recon account)
3) Please switch off the recon account indicator in the both GL accounts with OAMK.
For Ex: Lets say you have already posted APC value 10000 Dr and Accum dep 2000 Cr to the old GL account, so the net book value will be 8000 Dr.
In this case Please find out the total value of line items (2000 Cr as per the above example) for accum dep, that was already posted to the old GL account.
4) Post a journal voucher through F-02 like
                                                  Old G/L A/c Dr - 2000
                                                                New G/L A/c Cr - 2000
So after passing this entry you will find account balance as 8000 Dr in old GL account and 2000 Cr in new GL account.
5) after passing the above entry you need to switch on the recon account for both the GL accounts
Hope this will help.
Thanks,
Srinu

Impairment in new asset fixed (FI-AA)

We are implementing SAP ECC 6.0 and IFRS scenario. We want posting impairment in a new asset, ABZU Transaction (write-up), in IFRS 60 valuation area. This posting doesnu2019t work because ABZU transaction required accumulate amortization.
How can we posting impairment in new asset.
Which transaction type we must be used?
Net book value positive in area 60 at fiscal year start
Message no. AA647
Asset affected: 000600300021-0001

Dear Sider,
Transaction ABZU is used normally when you forgot to capitalize an asset in a fiscal year that is now closed. Also, there can be a case where depreciation you calculated in the past were too high. You must now correct this error using a write-up in the current fiscal year.
In your case, an impairment has to result in reduction in the book value of the asset and not a write-up.
The impairment can be done using Unplanned depreciation or Manual depreciation.
Once you enter the Unplanned depreciation, it will get posted after you do a regular AFAB depreciation run.
Hope it solves your issue.
Assign points, if useful

Unable to amend life of an asset

I am attempting to amend the life of an asset by navigating to Assets => Asset Workbench, querying the asset and then selecting the 'Books' button. The details of the asset appear and then withih the depreciation tab under Method, I amend the life in years field. I then amend the Amortization start date to the date I require and then select the 'Done' button.
I then receive a caution message stating that I am attempting to overlap this amortizxation with a previous transaction. I click on ok to proceed and then receive a message to state that the transaction is complete and 1 record has been applied and saved. Within this form the reference number also populates to confirm that this request has worked so I assume all has worked ok.
When I view the financial information for the asset the Life Years field has reverted to the old value, can someone please help and advise if I am missing a step somewhere.
Thanks

I have now managed to amend the life by amending this first however I am unable to amend the amortization start date, it stays as the current date. When I attempt to amend this date it shows the caution stating that I am attempting to overlap the amortization with a previous transaction and I click ok to proceed however the message at the bottom of the form advises that there are no changes to save.

Assign Production Order To Asset

Hi
Please Advice
I have a scenario where in I need to asssign the Producten Order Created for material to Asset for accounting point of view in the sense that all the expenses done for that Production order is transfered to that particular assigned asset.
We have the option of assigning the Asset to the Purcahse Order in case we procure the same material. So it is possible in the case if the same material is produced inhouse.
Regards
Rahul Bhardwaj

Thanks For the reply
Tell me few things,
1) Are you producing this material in house or some time purchase from out side also?
Ans 1: Yes the die is produced inhouse or sometimes we procure it from outside.
2)whether you want existing produce die to available in inventory or you want to have it as Asset only?
Ans 2: See they want the dies to be available for the inventory. But either they can have inventory for that or can define as asset so still the decision is pending.And I have checked in case of asset that when you create a Pur.Order of asset and do migo and than miro than the quantity of asset is updated along with its cost. I think they will go for asset as they can post the depriciation value for that.
3) Are you talking about Die Amortization cost?
Ans 3 : No sir amortization is not involved. Actually what happens is that when I produce the die inhouse i receive the quantity produced and the value for the die is updated in the material G/L account. Now when i go like this i cannot do the depriciation. So even here in case of inhouse produced die I have to create an asset for that , but the probem is that they want system to propose the value of that asset i.e. inhouse produced cost which includes (the raw material cost + Activity cost + Overheads) , every time they produce it inhouse. so they want this cost to be transfered to the asset they create.
Hope sir I am able to answer you questions, but still in case any further clearance is requiered , please do write in.

Asset report - with asset G/L accounts connected for gross value and amorti

Hello dear all,
Is there a way to obtain asset report by asset (and not by asset class) with the G/L accounts connected for gross value (acquisition) and amortization (depreciation) ?
Thanks
Edited by: Tarek AYACHI on Jun 1, 2010 10:25 AM

Look to the report S_ALR_87011990 - Asset History Sheet for more information about this report look in the wiki part from this forum
http://wiki.sdn.sap.com/wiki/display/ERPFI/Asset+Reporting
perhaps you can find with the ransaction ARQ0 - Ad Hoc Reports you need

SBO 2005 PL1 : Fixed Assets

We are deploying SBO in Lebanon - For the Fixed Assets, they have one legal requirement which oblige them to force the Residual Value to one when it's totaly amortize until the equipment or material is not scrap out. How could we force the vaue to one ?
Edited by: Marc Riar on Feb 21, 2008 2:06 PM

Hi
Start from 2005 SP1 PL75, there are some bahavior change for Salvage value feature.
1. Where are the new fields regarding salvage value?
    o Field name: Salvage Value %
       Location:    Depreciation Types form => General Tab
       Description: salvage value = APC * Salvage value %
    o Field name: Include Salvage Value in Depreciation
       Location:    Depreciation Types form => General Tab
       Description: Control whether to include Salvage Value in
depreciation calculation. Select this checkbox to exclude Salvage value in deprecication calculation.
    o Field name: Salvage Value
       Location:    Fixed Asset Master Data form => General Tab
       Description: salvage value of specific asset
2. How to configure salvage value for an asset?
salvage value = APC * Salvage Value Percentage of Depreciation Type
    o Salvage value is always updated automatically according to above formula if transtions trigger the change of APC.
    o Salvage value always takes effect for the whole fiscal year.
    o You can also modify salvage value manually in Fixed Asset Master Data form => General Tab. Change of salvage value will trigger the recalculation of depreciation.
3. How to calculate planned depreciation value based on salvage value?
    o Example I:
       APC: 10,000     Useful Life: 10 years     Salvage Value: 2,000
       Depreciation type: Straight-line depreciation
       Calclation Method: Acquisition Value / Total Useful Life
       Include Salvage Value in Depreciation: Not checked
       Yearly Depreciation Amount =
       (APC - Salvage Value) / Useful Life = (10000 - 2000) / 10 = 800
    o Example II:
       APC: 10,000     Useful Life: 10 years     Salvage Value: 2,000
       Depreciation type: Straight-line depreciation
       Calclation Method: Acquisition Value / Total Useful Life
       Include Salvage Value in Depreciation: Checked
       Yearly Depreciation Amount = APC / Useful Life
       = 10000 / 10 = 1000
4. Relevant rules with regard to salvage value:
    a) All depreciation areas of an asset use the same salvage value.
    b) Salvage Value field in Fixed Asset Master Data form => General Tab is editable if and only if Salvage Value Percentage of depreciation type of main depreciation area is not zero.
    c) In Depreciation Types form => General Tab, the setting of
       Depreciation Value Limit only takes effect when the Salvage Value % is zero.
    d) When you import a fixed asset master data, salvage value is retrieved automatically according to the depreciation type from the main depreciation area. Make sure that salvage value is not greater than NBV, otherwise an error message will come up in log file.
5. Depreciation Value Limit Vs. Salvage Value:
    a) Both are the amount at which the asset depreciation stops.
    b) Depreciation Value Limit only takes effect when Salvage Value % is zero.
    c) Depreciation Value Limit is not considered in planned       depreciation calclulation.
    d) Salvage value is considered in planned depreciation calclulation if Include Salvage Value in Depreciation of depreciation type is not checked.
You can also refer to SAP Notehttps://service.sap.com/sap/support/notes/1100660.
Hope it is helpful!
Regards,
Ivy Zhang
SAP Business One Forums Team

Transfer Asset from Non Depreciating Asset Class to Depreciating Asset Clas

We use the fixed asset subledger to maintain patents and patent applications. The patent applications do not amortize. How do I transfer from the patent application class to the patent class which will begin to amortize?

Hi, it can be done in accordance with your bs requirements, it's the same like transfer from auc to asset

FX Valuation in TPM1 with Gross Amortization Procedure (2 FI accounts)

Dear Experts,
I have one question regarding the foreign exchange valuation in tpm1:
The Position Management Procedure include the Gross Amortization Procedure, where Premium/Discount is not included in Book Value. Therefore the premium/discount is posted as accrued/deferred account.
At the end I will have one asset account for the Nominal Value and a second asset account for the premium/discount.
My problem: I cannot split the FX Valuation in the 2 accounts. Do you have any idea?
Thank you in advance!
Andreas

Hi,
Was reading through this question and I understand that the question is answered, but just wanted to check on certain points.
In PMP, do we need to have two procedures for the same step (forex valuation) and will it actually work? I will check this.
Also if I understand the requirement correctly, you are managing premium/discounts through deferred revenue accounts. Hence when you do a forex valuation, you want the valuation amount to be split separately for position account and deferred revenue account? But in general is it the practice to separately valuate it.
When you do forex valuation, it will take into account the overall book value which is the purchase value plus the amortized amount. Valuation is performed for the new book value.
For the balance in local currency in the deferred revenue account, when you do the final repayment, a translation flow is generated based on the update type specified from the position outflows tab. This procedure can be managed in your current release itself.
Regards,
Ravi

Debt management in Fixed assets

Hi All,
I have a project as a question which I try to realize but I do not know if it is possible in Fixed oracle Asset.
The question is as follows:
Shall I can generated the writing of subscription of a loan in oracle Basic salaries Assets fa as an acquisition of an asset which can be an asset with a negative value?
Why this question?
In reality, it is because I would like to handle all the accounting cycle of a loan (subscription, refund, amortization,...) in oracle FA and I wonder upstream if there is indeed an elegant and automatic solution by FA?
Thank you for expressing me our opinions if this is possible and how.

Saritha,
We generate that on the fly. Just insert records into the table fa_asset_keywords.
INSERT INTO fa_asset_keywords
(enabled_flag, code_combination_id, segment1,
summary_flag, last_update_date, last_updated_by,
last_update_login)
VALUES ('Y', fa_asset_keywords_s.NEXTVAL, substr(model,1,30),
'N', SYSDATE, fnd_global.user_id,
fnd_global.login_id);
Both value sets are "None" validated. Hence gives us a choice to insert the values on the fly and generate CCID.
Thanks
Nagamohan

Depreciating assets as on particular date

Hello All
We have some assets whose depreciation method has to be changed in such a way that these assets fully depreciate by 31-Dec-2008 irrespective of their date placed in service.
Currently these assets have been assigned SLM of 25%.
How do I do so?
Regards
Rohan

Rohan,
Although the requirement sounds simple, it is infact quite a complicated requirement.
The first question that I would ask is, what is the volume of assets that you need to make this update for? If you are looking at a high volume of assets your requirement cannot be achieved without customization.
If you are looking at a low volume then each asset would require having it's life adjusted, so that it meets the 31st December 2008 full depreciation that you require. This can be done either via the Books form or the Mass Changes Form (The latter can be used if the selection criteria can be used to identify assets of interest, without affecting assets that should not be changed.)
The other problem that you face is how to deal with depreciation adjustment that will occur when the life is adjusted. The prudent measure would be to expense it in the period that it is realized, however as this will result in a one-off hit to the P&L not many folk would like to take that step.
The alternative would be amortize the resulting adjustment between the current date and the required end date.
Regards,
Logan 3

Amortization of assets

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