Chapter 3

3-1
Asset Accounting Overview
Increasing automation makes planning and monitoring of fixed assets for
external and internal accounting purposes ever more important. In addition
to pure accounting and balance sheet preparation, there are extensive
requirements for controlling and maintenance monitoring. Furthermore, you
must be able to determine easily and precisely the ever more complex
requirements of group accounting on both national and international levels.
These various requirements are defined in the chart of depreciation. Here
you can represent various valuation methods in a number of depreciation
areas for commercial balance sheets, tax requirements, controlling purposes,
corporate policies, and other free valuations. You can carry out these activi-
ties in domestic or in foreign currencies. A variety of country-specific valua-
tion plans and depreciation keys are delivered with the system.
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Fig. 3-1: Factors Influencing Asset Management
Asset classes support the structuring and classification of fixed assets. Cen-
tral default values, such as classification criteria, depreciation keys and use-
ful life, data on the valuation of net assets, insurance related data, and much
more are stored with the asset class. When assets are inventoried, this class is
simply copied. Even if assets are extensive and complex, the system guar-
antees a clear and well thought-out classification of the fixed assets. This
offers advantages with respect to valuation reliability and asset-specific
evaluation.
Increasing Requirements
Flexible Valuation
Capabilities
Asset Classes
3 Overview
3-2
The class concept is supplemented by the definition of individual validation
and replacement rules. They permit complex checks for logical and organ-
izational consistency of the entries during master data maintenance or post-
ing. In the integrated system, this concept even makes it feasible for buyers
or accounts payable managers to create asset master records whenever they
need them rather than having to wait for confirmation from asset accounting.
Even in the asset class we distinguish between essential asset types, such as
assets under construction, low-value economic units, leased assets, and
assets that are to be capitalized normally. For the vertical classification of
complex economic units there are group assets, asset super-numbers, as well
as main asset numbers and asset sub-numbers. While the main capitalization
is carried on the main asset number, the sub-number is used to represent
special interchangeable components or subsequent expansions of the asset. If
several master records are to be combined for a common depreciation
calculation, a group asset is formed. The asset super-number is used in
reporting to add up any desired number of asset master records.
Regardless of the process sequence used to capitalize the assets, the inte-
grated system supports all conceivable transactions, including:
Y Asset acquisition preceded by a purchase order generated in R/3 pur-
chasing and followed by the receipt of the goods and the invoice.
Y Asset acquisition without a purchase order based on a vendor invoice.
Y Asset acquisition through in-house production of a capital investment
project or a capital investment order.
This makes it possible to eliminate the expense that is generally associated
with posting asset acquisitions in asset accounting. The capitalization values
of the assets are automatically provided by the integrated applications
(accounts payable, purchasing/inventory management, job order settlement
or project settlement).
Analogously, for asset retirement SAP offers close integration with accounts
receivable, which automatically determines from sales revenue data the
profit or loss generated by the sale. Accounts receivable then posts this
amount to the profit and loss statement and to cost accounting, if desired.
In the asset information system, SAP provides all the necessary evaluations
to meet legal requirements. Particularly relevant in this context is the asset
history sheet, which is the central closing evaluation for asset accounting.
You can freely configure the asset history sheet column and line layout.
On the other hand, R/3 offers comprehensive reports for controlling pur-
poses, information on costing-based replacement values, depreciation, and
interest by organizational unit. The concept of depreciation areas makes it
possible to execute each report for any desired depreciation area, allowing
you to generate at the push of a button an asset history sheet with group
values, for example.
Representation of an
Economic Unit
Comprehensive Integration
for Asset Transactions
Information System
Overview 3
3-3
R/3 supports optimization of operating results and of operational planning
using comprehensive simulation features. This makes it possible to execute
any report by simulating changes in the depreciation method. If the result of
the simulation is favorable, you can transfer the optimized depreciation
results to the profit and loss statement.
You can transfer optimized balance-sheet and cost-accounting depreciation
to the corresponding applications (general ledger or controlling) using a
mass change procedure. You can freely define the frequency of this transfer
as well as any desired auxiliary account assignments, such as cost centers or
internal orders for cost-accounting or book depreciation. To prepare addi-
tional balance sheets for tax or group purposes, R/3 offers the option of
transferring depreciation and asset values of any number of depreciation
areas to parallel asset accounting systems.
Numerous tools simplify system operation. In addition to a user-friendly
environment, these include:
Y Individually definable replacement and validation rules to simplify
inventorying of assets and increase data entry reliability in posting.
Y Comprehensive features to simulate depreciation from any asset infor-
mation system report.
Y Flexible tools to transfer your asset accounting data to the SAP system.
Y Tools to mass process data, notably to execute mass changes and mass
retirements.
Organizational complexity and internationalization increasingly require the
use of local systems. SAP therefore has adopted the following central points
for its development planning:
Y Implementation of central G/L accounting and central purchasing with
local asset accounting, or central asset accounting with, for example,
local purchasing.
Y Linkage of SAPs R/3 FI-AA application with external systems.
Simulation and Balance
Sheet Optimization
Integration of Depreciation
Ease of Use
Openness