Depreciation Calculation in ERP 6.0. Nathan Genez & Eric Barlow Managing Partners Serio Consulting LLC

Transcription

1 SAP s New Depreciation Calculation in ERP 6.0 Nathan Genez & Eric Barlow Managing Partners Serio Consulting LLC

2 Contents New Depreciation Calculation in ERP 6.0 Upgrade Considerations Wrap-Up

3 Contents New Depreciation Calculation in ERP 6.0 Upgrade Considerations Wrap-Up

4 Who is Serio Consulting? Founded by a group of fformer SAP America Platinum Consultants with over 40 years combined SAP experience Focused on the Capital Management area of SAP across both SAP ERP and SAP BW Project Systems (PS) Investment Management (IM) Asset Accounting (FI-AA) Professional Service Offering: SAP Implementations and Upgrades Quality Assurance and Configuration Reviews Advanced Capital Management reporting solutions including BW Advanced Tax solutions Remote On-Demand consulting Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #4

5 Scope of New Depreciation Calculation (New DCP) What does the New Depreciation Calculation refer to? How depreciation amounts are calculated / planned It does not refer to How depreciation is posted The process to gather depreciation figures and post them to the G/L is covered by the depreciation posting program RAPOST2000 Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #5

6 What Values Are Affected? All planned values including: Planned ordinary depreciation Planned special depreciation Interest Inflation Revaluation Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #6

7 Why Was the Calculation Changed? A period interval-based calculation is more intuitive and easier to understand Support of time-dependent depreciation parameters Support of method changeover and base value determination on a period level More flexibility to support customer and country specific requirements via Business Add-Ins (BAdIs) Potentially greater performance Better handling of rounding accuracy issues related to large amounts with no decimals (e.g., currency JPY) and many other reasons (mostly country specific) Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #7

8 Technical Requirements Delivered in SAP ERP 6.0 as part of the Enterprise AddOn for Financials (EA-FIN) Not possible to release for earlier SAP ERP or SAP R/3 versions EA-FIN must be active The new calculation cannot be disabled using standard methods other than deactivating EA-FIN Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #8

9 Old: Transaction-Based Calculation Prior to SAP ERP 6.0, depreciation was always calculated in detail on every transaction line item Whenever a transaction is posted, a depreciation amount was calculated The asset line item table contained fields for: Odi Ordinary depreciation on transaction ti Special depreciation on transaction Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #9

10 Old: Transaction-Based Calculation (cont.) All transactions were interpreted sequentially First posting served as the baseline calculation All subsequent postings were adjustments to the original posting Annual depreciation = sum of the depreciation of the individual transactions This approach could make the verification of depreciation figures difficult Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #10

11 Example of Transaction-Based Calculation Scenario The Straight line depreciation Total Acquisition Cost (APC) / Total Useful Life (UL) Useful life = 10 years 12 period calendar fiscal year: January December (e.g., K4) Period control = pro rata determination following two transactions are posted: Transaction Amount / Percentage Time Initial Acquisition iti $12,000 January 1 Partial Retirement (current year) $3,000 October 1 Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #11

12 Example of Transaction-Based Calculation (cont.) Date Transaction Type Transaction Amount Period Factor Rate Base Value Calculated Depreciation Jan 1 Initial Acquisition $12, / 12 10% $12,000 - $1,200 Total - $1,200 Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #12

13 Example of Transaction-Based Calculation (cont.) Date Transaction Type Transaction Amount Period Factor Rate Base Value Calculated Depreciation Jan 1 Initial Acquisition $12, / 12 10% $12,000 - $1,200 Oct 1 Partial Retirement - $3,000 3 / 12 10% - $3,000 $75 Total - $1,125 Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #13

14 Example of Transaction-Based Calculation (cont.) R/3 4.7

15 Example of Transaction-Based Calculation (cont.) R/3 4.7

16 Example of Transaction-Based Calculation (cont.) R/3 4.7 Asset Explorer displayed the depreciation amounts calculated for each line item Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #16

17 Example of Transaction-Based Calculation (cont.) Asset Line Item table displayed the amounts in additional detail R/3 4.7 Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #17

18 New: Period Interval-Based Calculation Depreciation calculation is based on period intervals (time segments) All transactions in the same period interval are aggregated and used to calculate depreciation as a single number All line items are aggregated by their appropriate period All periods are aggregated to get an annual value Annual depreciation = sum of the depreciation of the period intervals Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #18

19 New: Period Interval-Based Calculation (cont.) SAP ERP 6.0 no longer calculates depreciation or interest on asset line items ERP 6.0 Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #19

20 What Is a Period Interval? Initially, there is just one time interval per year, depreciation area, and amount type New segments are created whenever an event changes the asset s value, such as: Transactions within fiscal year Time-dependent master data changes Shutdown or multiple shift intervals Depreciation parameter changes Changes to depreciation method Multilevel method changes within a fiscal year Method changeover occurs at the end or within the UL Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #20

21 More Information on Period Intervals The number of period intervals depends on the number of fiscal periods with changes that affect the asset s depreciation calculation The more transactions posted Or the more depreciation parameter changes Made across more periods will yield more depreciation period intervals The maximum m number of depreciation period intervals is the same as the number of normal fiscal periods Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #21

22 Example of Period Interval-Based Calculation Period Interval 1 Date Jan 1 Transaction Type Initial Acquisition Transaction Amount Prd Int Prd Interval Duration Rate Base Value Depreciation Per Interval $12, months 10% $12,000 - $1,200 Total - $1,200 Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #22

23 Example of Period Interval-Based Calculation (cont.) Period Interval 1 Period Interval 2 Date Jan 1 Oct 1 Transaction Type Initial Acquisition Partial Retirement Transaction Amount Prd Int Prd Interval Duration Rate Base Value Depreciation Per Interval $12, months 10% $12,000 - $900 - $3, months 10% $9,000 - $225 Total - $1,125 Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #23

24 Example of Period Interval-Based Calculation (cont.) ERP 6.0 Period Interval = 1-12 Base Value Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #24 Period Factor Percentage Final Annual Depreciation

25 Example of Period Interval-Based Calculation (cont.) ERP 6.0 Base Value Final Annual Depreciation Period Interval 1 = 1-9 Period Interval 2 = Percentage Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #25 Period Factor

26 Comparison of Old vs. New Calculations Is there a difference in the final calculated amount between these two approaches? NO The annual depreciation amount is identical between both approaches for most all scenarios. Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #26

27 Contents New Depreciation Calculation in ERP 6.0 Upgrade Considerations Wrap-Up

28 Configuration Requirements No configuration is required as part of the new calculation No No changes are necessary to the depreciation areas or depreciation keys migration of data is required The final depreciation amounts calculated by SAP should be the same before and after the upgrade * Small amount differences might occur in some situations Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #28

29 Process SAP recommends that all customers recalculate values (RAAFAR00) immediately after the technical upgrade Also consider recalculating prior to the upgrade as part of a formal system close process Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #29

30 Enhancements Existing user exits are no longer processed by the new depreciation calculation SAP-delivered d new BAdI is compliant with the new calculation BAdI FAA_EE_CUSTOMER Method SET_BASE_VALUE replaces AFAR0001 Method SET_PERCENT_AMOUNT replaces AFAR0002 Method DEFINE_CHANGEOVER_YR replaces AFAR0003 A migration of the business logic must be made to these new BAdIs if the new calculation is used Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #30

31 Reporting Since depreciation is no longer calculated on a line item basis, all asset transaction reports will show $0.00 as the depreciation amount SAP Note will hide the depreciation figures so that the report is not misleading Consider creating an asset history sheet version that t breaks out depreciation by type for each period Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #31

32 Asset Explorer In addition to the normal Asset Explorer, there is an alternative version that always uses the old depreciation calculation Allows you to compare the calculations between the old and new depreciation calculations without deactivating the Enterprise AddOn Transaction AW01N AW01_AFARAFAR Description Current Depreciation Calculation (New) Old Depreciation Calculation Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #32

33 Asset Explorer AW01N New Depreciation Calc ERP 6.0 Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #33

34 Asset Explorer AW01_AFAR Old Deprec Calc ERP 6.0 Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #34

35 Contents New Depreciation Calculation in ERP 6.0 Upgrade Considerations Wrap-Up

36 Resources Relevant SAP Notes Fix for asset line item reports Explanation of small differences post upgrade Information related to new calculation s impacts on year end closing Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #36

37 Resources (cont.) SAP ERP 6.0 Documentation on New DCP 2e5920e a155369/frameset.htm SAP ERP 6.0 release notes 02/helpdata/en/43/68805bb88f2 97ee a422035/frameset.htm Information for Enterprise AddOn EA-FIN e a114a6b/frameset.htm Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #37

38 Resources (cont.) SAP Developer Network (SDN) Wiki > ERP Financials > Financial Accounting > Asset Accounting Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #38

39 Resources (cont.) SAP Developer Network (SDN) Blog Series > ERP Financials > Financial Accounting > Asset Accounting Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #39

40 Resources (cont.) SAP Financials Expert Discover the Logic and Parameter Changes in the New Depreciation Calculation (January 2007) Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #40

41 Thank you for your attention Nathan Genez Managing Partner Serio Consulting LLC 227 Sandy Springs Place Suite D238 Atlanta, GA T E nathan.genez@serioconsulting.com Eric Barlow Managing Partner Serio Consulting LLC 227 Sandy Springs Place Suite D238 Atlanta, GA T E eric.barlow@serioconsulting.com Source: Nathan Genez & Eric Barlow, New DCP Overview, slide #41