Use of depreciation area

Hello Sap Experts
I have a doubt on exact use of depreciation area in asset accounting.
We control the rate of depreciation and method of depreciation through depreciaiton key.
So what is the exact use of depreciation area in asset accounting.
Kindly explain.
Thanks & Regards
Deepak Garg

hi deepak
A chart of depreciation is actually list of various depreciation areas.
Each depreciation area represents a requirement of reporting asset depreciation  for
                          a. balance sheet
                          b.tax purposes
                          c. Cost accounting
Further each depreciation area could also report based on Accounting principles e.g. GAAP,IFRS based on the valuation areas.
The chart of depreciation is assigned to a company code.
regards
eashwar

Similar Messages

  • How to get Depreciation key independant from Depreciation area

    Hello,
    We are using two depreciation areas  01 book depreciation and 15 Tax, in our asset class we have put  for both the same depreciation key (GD50) but with a different uselife for every depreciation area
    Now when we create a new asset (AS01) intially the correct uselife appears ( tab depreciation area) but apparently when i want to change the one for depreciation area 01 its also changed in depreciation area 15  - how can we avoid that 15 is 'linked' to 01?
    Many thanks

    Dear janbritt
    Unflag your Dpr Area in OABD.
    Reagrds

  • Depreciation Area posts APC twice

    Dear Experts
    We want to adjust APC & Dep in Non leading ledgers as per Local GAAP
    I've kept the following settings for my depreciation areas in OADB
    01 - Leading Ledger - Ledger 0L - Posting Ind 1
    11 - Non Leading Ledger DE - Posting Indicator 2 or 4
    Now when I do an asset acquisition, system posts the depreciation in Ledger 0L & DE correctly. But another entry is generated in  DE ledger just because we have keeping it 2 or 4.
    System doesnt identify that a posting has already gone to DE and still tries to create another entry and I feel its a bug / technical issue.
    So it must to keep posting indicator 3 for Dep 11 and to have another Dep area say 20 (11-01) with posting indicator either 5 or 6. to avoid this duplicate posting?
    Please suggest.
    Regards
    Kapil

    Hello Kapil,
    You need to use derive depreciation Area
    Area                                GL indicator        Ledger
    01        Leading Ledger   1                          0L
    11        Non Leading         3                         DE
    90        Difference             6                        DE
    90 must be set up as (Area 11 - 1)
    When you post Acquisition let say 100, Both ledger will be posted
    Document no: 1  (in the accounting document Ledger group is Blank: meaning all ledgers are posted)
    0L    100
    DE   100
    When you post depreciation 20. (2 documents will be posted, 1 for 0L and 1 for DE)
    Document 1D:
    0L 20
    Document 1E:
    DE 20
    In case there is a difference between APC and Dep of Area 01 and 11
    Leading APC: 100 Non Leading APC: 200
    Document 1 APC:
    0L 100 (Area 01)
    DE 100 (Area 01)
    Document 2 APC:
    DE 100 (area 90 Area 11 -1 )
    That gives you 100 to 0L and 200 to DE
    Thanks!
    Jhero

  • Different Transaction Types for Different Depreciation Areas

    Dear Friends,
    When I am viewing the asset explorer for the asset, it is oberved that for book derpreciation 01, the asset transaction type "acquisition value" is updated and am able to view the same.
    However when I am going through the tax depreciation area, the transaction type intercompany transfer" got updated and the acquisition values are not updated.
    I would like know the reason of how the system is going to update different transaction types in different depreciation areas since the postings only takes effect in book depreciation and same should be diplayed for tax depreciation.
    Thanks in advance!

    hi
    go to OAYA
    select        "Limit Transaction Types to Depreciation Areas"
    select the trnsaction type you using .
    select depreciation area specification
    and maintain entries for every dep area you want to maintain for transaction type.
    regards

  • Revaluation of depreciation for prior year in alternative depreciation area

    Hi,
    I have a problem with a couple of assets. We are using 2 depreciation areas - one for statutory depreciation that is posted against GL accounts and one for fiscal purposes, which is only statistical.
    For some assets the depreciation key in the alternative, fiscal depreciation area was wrong in last two fiscal years. Is it possible to reopen that old fiscal years and change the depreciation area to correct one and revaluate the depreciation only in that parallel depreciation area? If yes - which steps should i carry out in SAP? This depreciation area does not affect GL accounts posting - so I hope it is possible.
    Thank you,
    Karol

    Hi Murali,
    Thank you for your reply.
    My only concern is - I don't want to affect the other depreciation areas (in case anything changed in their depreciation keys).
    Is there a way to just open past years only for this particular depreciation area and to rerun depreciation just for it?
    I thought of OAAR transaction - undo year end closing by Depreciation area - just to focus on it. Do you think it might work the same as AJRW, or should I use AJRW?
    Can I  run AFAR only for the selected depreciation area and it will not affect any other depreciaton area? We are using 4.6C version.
    Thank you,
    Karol

  • 2 Depreciation Areas For Different Ledgers

    Dear All,
    I'm using 2 depreciation areas (01, 60) for different ledger (L1, L2) due to company requirements. However, during asset retirement, posted amount does not reflected correctly in Ledger 2 (depreciation 60).
    Amount displayed correctly in Asset Module but not in FI Documents. Below is the setting in OADB: -
    Area G/L Trgt Group
    01 1 - Real Time Posting L1
    60 3 - area post dep only L2
    80 6 - area posts only APC directly L2
    Depreciation were posted corectly into repective depreciation areas & Ledger.
    Please advice!
    Thanks !

    Hi,
    You have taken posting GL as 2, i.e.area posts APC and depreciation on periodic basis. In this case you have to run periodic postings "ASKBN" to update the L2 ledger.

  • Logic of different Depreciation Areas

    Hi,
    Kindly tell me the logic of different Depreciation eys?
    Regards

    depreciation areas are used to calculate different values in parallel for each fixed asset for different purposes. For example, you may require different types of values for the balance sheet than for cost accounting or tax purposes. You manage the depreciation terms and values necessary for this valuation in the depreciation areas of each asset.
    SAP allows you to define up to 99 depreciation areas, you can manage many different types of valuation (Customizing: Valuation). Depreciation areas are grouped together, according to the requirements of a specific country or economic area, into a chart of depreciation
    You can post both the asset balance sheet values and the depreciation values from the individual depreciation areas to separate balance sheet accounts or income statement accounts in the general ledger. You specify the accounts individually in the account determination key for each depreciation area. Define the account determination key in FI-AA Customizing and specify the key in the particular asset class
    Usually you need to post more than one depreciation area in parallel to the general ledger if you are creating different financial statement versions. You can define any number of balance sheet versions per chart of accounts in FI (General Ledger) for this purpose. For each balance sheet account and income statement account, you specify in the financial statement version the balance sheet position or income statement position in which the account values should appear
    The depreciation areas in a chart of depreciation have no automatically defined features. You determine the features of each area individually, based on the basic structure, which is the same for all depreciation areas. You can make specifications for the following levels for each depreciation area:
    At the chart of depreciation level
    At the company code level
    For legacy data transfer
    Features at Chart of Depreciation Level
    Use
    You can specify the following features for a depreciation area at the chart of depreciation level (Customizing: Valuation ® Depreciation Areas).
    Features
    Posting Values from Depreciation Area to General Ledger
    You can automatically post asset balance sheet values (APC/ proportional value adjustments) and depreciation from each depreciation area to the corresponding general ledger accounts. You can choose whether values are automatically posted immediately online in Financial Accounting (at present, only possible for one area per chart of depreciation; with two exceptions: investment support areas managed on the liabilities side, and areas solely for revaluation), or are posted automatically at periodic intervals to Financial Accounting.
    In addition, you can specify that only depreciation (no APC values) should be posted automatically. This type of posting might be useful for depreciation areas for cost accounting depreciation.
    Managing Certain Values
    In the definition of a depreciation area, you can specify if the area should manage acquisition and production costs (APC). Areas that do not manage APC are, for example, depreciation areas only for value adjustments shown on the liabilities side (for example, investment support).
    In addition, you specify in each depreciation area whether the net book value of assets in the area is allowed to be positive and/or negative. The system rejects any posting that leads to a net book value that contradicts the rule you entered.
    Allow negative net book value in all areas
    That have depreciation below zero
    That are intended for value adjustments shown on the liabilities side
    That are derived depreciation areas, and can have negative values because of their calculation formula.

  • Deactivate a depreciation Area

    Hi Guys
    I wan to deactivate a depreciation area. Depreciation area does not post but it is a real depreciation area.
    Is there any risk to deactivate the depreciation area for the asset class in OAYZ  ?
    We do not want this depreciation area be activated any more.
    Thanks

    Hi
    But I do not want to use this depreciation area any more for any other asset.
    So I have several suggestion but I am confused:
    - In  OABN (this only manage ordinary depreciation)
    - But I think the safety procedure is deactivating it in OAYZ.
    I am wondering what are the steps to deactivate the depreciation area in a safetely way whitout  impact.
    The depreciation area itself did not post in GL  , nevertherless it is it is a real depreciation area. (OADB).
    Can anyone suguest all the steps  , why I have to do it in OABN rather than in OAYZ.
    I think that if I have to deactivate the depreciation area I have to do it in OAYZ (for asset class, then new assets won´t have this depreciation area available whereas old asset still show this depreciation area in AS03.

  • New GL Environment - Asset Management - Depreciation Areas

    Hi Folks
    My client currently is on 4.6C R/3 platform. The asset management configuration for Depreciation Areas is such that the area 01 has been assigned to Local GAAP postings and has Real Time Posting flag set to yes. Area 20 has been assigned to IAS, but without Real Time Posting flag.
    Going for New GL, the question is does SAP allow Leading Ledger (0L) to have a depreciation area (20 in our case) which is not configured for real time postings while allowing Non Leading Ledger (say X1) to have a depreciation area (01 in our case) which is configured for real time postings.
    If SAP allows this, it is OK, we just migrate as it is.
    If not, we need to swap configurations between the two depreciation areas and do a de-facto re implementation of AA module as a precursor to New GL migration.
    Also, keeping this issue in mind, would it be better/ advisible to go in for New GL migration sometime middle of a year?
    Any thoughts/ experiences/ advice on this situation?
    Regards
    Mandar

    You can use derived depreciation area concept and can post to different ledgers.
    One limitation is that the formula which you give is always 60=01-20 and not 20-01. Here 01, 20, 60 are depreciation areas. 60 is the derived depreciation area which is a standrd delivery.
    You are not clear whether are you posting to 20 periodically or not? Or it is for only reporting?.
    Assuming you are posting in 4.6C and want to continue the same, you can do so by the derived depreciation area.
    You may be needing to configure your system for periodical posting (ASKBN) and you need to use FB50L for postings to specific Ledger or ledger groups. If you want to post all the ledgers same value but for the depreciation, you can use the old transactions.
    you run your scenario in sand box and test your self before come to a conclusion.
    The scenario what you are referring is a standard functionality.

  • Derived depreciation area

    Hello Gurus,
    I am trying to create derived depreciation area with t-code OADB. 
    This t-code is disabled and not allowing me to define the derived areas. Is this the right t-code to define Derived areas? or Is there any other way?
    Please help me. Your time will be greately appreciated..
    Thank you..
    Regards
    Geeta

    Hello
    Postings to derived area is simultaneous.
    check this
    The "Derived Depreciation Areas" component makes it possible to determine new asset values based on asset values that have already been determined. The derived depreciation area uses mathematical formulas to determine values based on values in ‘real’ areas, such as the difference between depreciation in two depreciation areas. The system then manages these new values in the derived depreciation area.
    You define the formula for the derived depreciation area in FI-AA Customizing (Define depreciation areas). In the formula for a derived area, you can use up to four real areas. The arithmetic operations allowed are addition and subtraction. It is possible to mix the calculation rules. This includes using proportional values from real areas in the calculation.
    When defining the formula, it is up to you to make sure it is reasonable. Make sure that the key of the derived area is larger than the keys of the real areas it is based on. A derived area "03" can be derived from the real areas "01" and "02" but not from areas "04" and "05."
    You can also specify that the derived depreciation area is only for reporting. The system then does not subject the area to value checks (such as the check for positive/negative net book value).
    When defining a derived depreciation area, keep in mind that the rules for remaining book value rule in the derived depreciation area can affect the depreciation in the real areas from which it is derived (see Characteristics of a Depreciation Area). Enter a modification area in order to specify which of the real areas this should be.
    Be careful when using derived depreciation areas for group assets. In the formula for derived depreciation areas that are for group assets, you can only use depreciation areas that are also intended for group assets (see Group Assets).
    Reg
    *assign points if useful

  • Use of Different Fiscal Year Variant-Statistical Depreciation Area Postings

    An existing Company Code in SAP is going to have Fixed Assets implemented.  This Company Code is setup just like the others in our SAP instance: Same Chart of Accounts, Same Fiscal Year Variant, Fixed Asset procedures, etc.  For purposes of this question our company's Fiscal Year is from August 1st to July 31st.  In addition, this Company Code will post Fixed Assets just like the other SAP enabled Company Codes into Book Depreciation Area 01.  The company I work with is on ECC 6 but we use the Classic Ledger for Financials, and the Special Ledger is posted to but not really utilized.
    For the Country Specific/Tax Reporting purposes within Fixed Asset Accounting we have created a Statistical Depreciation Area 03 (I will call it Tax) with its own Life and Depreciation Key assignments with a setting of 0 in OADB-No Posting in GL for this Fixed Asset go-live, so I think we are set there.  The tricky part comes in the reporting.  The country in question requires information to be generated on a Calendar Year basis, which is obviously different than the Fiscal Year outlined above.  To my knowledge we would have to assign Tax Depreciation Area 03 to the Calendar Fiscal Year Variant: Financial Accounting>>Asset Accounting>>Valuation>>Fiscal Year>>Fiscal Year Variants>>Specify Other Versions on Depreciation Area Level. 
    The other piece of this is to get the Fixed Asset Reporting for Tax Depreciation Area 03 to work on a Calendar Year basis for the Company Code in question.  When I did some research I stumbled upon the link below.  In summary it says that you have to manipulate the standard Fixed Assets reports in Excel for Asset Acquisitions and Depreciation, and setup a new Retirement routine/transaction for posting into the Special Depreciation Area.
    http://help.sap.com/saphelp_46c/helpdata/en/05/bc0bf3d8f811d1953e0000e82debf7/content.htm
    My questions are:
    1) Besides assigning a different Fiscal Year Variant for Tax Depreciation Area 03, is there anything else I need to worry about on the setup end?
    2) Is the article I posted accurate when it comes to how the reporting works and the need for setting up a Calendar Year specific Asset Retirement Routine?  If so, what are the configuration steps for setting up a Calendar Year specific Asset Retirement Routine?
    3) Is there anything else that I need to consider for enabling Fixed Assets at an existing Company Code with different Reporting requirements for Book/Tax purposes?
    Thanks in advance for all responses.  I am willing to answer any other questions on this subject if needed.
    Roman

    Hello Rio.  In our scenario, we still had to load assets in the legal entity with this issue.  When we loaded the fixed asset data into SAP we did with data accurate as of December 31, 2011; which for book purposes is 5 months into our company's fiscal year, and for tax purposes is the end of the 2011 calendar year.  The calendarized reporting for the tax depreciation will need to be pieced together manually using the SAP recommended methodology of combining report values, which I have pasted below.
    Since this is the only SAP-enabled entity that has this scenario right now we are in wait and see mode to see if this sufficient.  In the end the SAP path for Dual Calendar was too much of a risk.
    I hope this helps.
    Roman
    Asset Acquisitions 
    Run the acquisitions list. Report date: 7/31/2012. Posting Date: 1/1/2012 to 7/31/2012. Export the report to MS Excel.
    Run the acquisitions list. Report date: 7/31/2013. Posting Date: 8/1/2012 to 12/31/2012. Export the report to MS Excel.
    Add the values of both reports together, using MS Excel.
    Asset Retirements
    Run the retirements list. Report date: 7/31/2012. Posting Date: 1/1/2012 to 7/31/2012. Export the report to MS Excel.
    Run the retirements list. Report date: 7/31/2013. Posting Date: 8/1/2012 to 12/31/2012. Export the report to MS Excel.
    Add the values of both reports together, using MS Excel.
    Depreciation
    Run the depreciation list. Report date: 7/31/2012. Export the report to MS Excel.
    Run the depreciation list. Report date: 12/31/2011. Export the report to MS Excel.
    Run the depreciation list. Report date: 12/31/2012. Export the report to MS Excel.
    Using MS Excel functions, subtract the second report from the first, and then add the third report (I - II + III).

  • Problem with depreciation area (Incorrect currency exchange rate is used)

    Good day to all SDN forumers!
    I'm having a problem with one depreciation area that we set up. The reason why we configured this depreciation area is for us to enable to monitor all asset postings in another (group) currency aside from the local currency. We set it up in such a way that the depreciation would not post and would thus only "convert" the asset postings to group currency using the table rates in table TCURR (via OB08).
    The problem is despite having defined an exchange rate for the current period, the system still picks up the exchange rate for 01/01/2001 which is incorrect. This affected all reports which displays incorrect values whenever I view the postings using the 2nd depreciation area we set up. Is there a way we can correct this?
    I'd really appreciate your comments and suggestions guys. Thanks a lot and more power!

    Update:
    I created a new depreciation area by copying an existing area and updated some of the configuration. The problem is still there though, since the depreciation area still reflects the <b>incorrect</b> rate (similar to that of the previous depreciation area) whenever I access it using Asset Explorer. What's surprising is that even though I've already set the exchange rate (e.g. USD to EUR)  to match that of the asset's capitalization / acquisition date, the posted values still do not reflect what I defined in table TCURR. Instead, it reflects the exchange rate used by the old depreciation area. Help anyone? We are already in a production client and transfer/retirement of all the assets is not an option the client would like to undertake.
    Edited by: Patrick on Nov 6, 2008 4:45 AM

  • Which Depreciation Area is used to post values to G/L

    Hi,
    I do understand that multiple depreciation area can be created and used in asset master at the same time to meet multiple requirements of the company. Lets say that we have two separate requirements of handling Depreciation of Vehicles. Book depreciation and Tax Depreciation.lets say that the companies policy is to depreciate vehicles @ 10% but tax authority required it to be depreciated @ 15%. Now i can create two different depreciation areas for this and assign two different rates in asset master against each depreciation area. my question is when i execute the depreciation run through AFAB which amount of depreciation will be posted to G/L account? Book depreciation of tax depreciation? if only book depreciation is to be posted to G/L where would i get asset position based in tax depreciation rate and what will be the purpose of creating a separate depreciation area if no posting is going to be made to G/L with its reference. Please help me out here i am completely lost.
    Regards,

    Hi Faizan,
    We do maintain all the depreciation area in t-code OADB. Under each depreciation area, we define if depreciation post in Real time or not. If you are using classic GL, you will select this option for Book Dep area only. For Tax dep area, no real posting will be done, however you can view the dep details in asset reports.
    If you are using new GL, then refer to below link. This could be useful.
    http://scn.sap.com/docs/DOC-54335
    Regards,
    Gaurav

  • Different useful life in depreciation area - same depreciation

    Hello,
    I have the same depreciation key but different useful life for some assets master data, but when I calculate the depreciation, in the second depreciation area I have the same depreciation amounts like in the first depreciation area. The second depreciation area posts depreciation only...
    Can you help me please?
    Regards,
    Mike

    Hi Mike,
    to answer this question you should at least provide detailed information about the depreciation key used. For instance depreciating with a stated percentage rate wouldn´t consider the useful life, same depreciation amount would be the result. And there are several other possibilities.
    Regards,
    Markus

  • How to delete depreciation areas when a posting is made in asset accounting

    Hi All,
      We are implementing asset accounting to few of our company codes as a new company code start up project. We have opened depreciation areas for tax for one company code and found that we are not going to use this company code for asset accounting.
      We have already opened 2 depreciation areas one for tax and the other as difference between book and tax depr in our development client. One of our member has created an asset and posted values to it. Now, we were told that we dont need to open the depreciation areas. When i am trying to delete it system giving error message saying you cannot delete the derived depr as the values have already been posted.
    Please advice how i should proceed with the above issue for deleting the depreciation areas. Your help is much appreciated.
    Thanks in advance

    Hi Rose,
    For the below mentioned issue do the following:
    1) reset all the depreciation data ( t code OAGL)
    2)  reset all the asset account co code data (t code OABL)
    then u can go and delete the depreciation areas.
    regards,
    Kiran

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