Weighing Periods impact on Useful life

[Former Member]

parameters.jpgcalculation.jpgcalculation1.jpgperiod-cal.jpg

Hi,

We have issue when we activated weighing periods which has impacted the useful life as below.

Our client is having year dependent calendar with 6 weeks in Jan & Dec and rest follows 4 weeks as period.Now we are also planning to change the same to Year depended=Cal year period starting 2017 i.e P1 starts on 31st Dec 2016 and ends on 31st Jan.So we ahve 32 days for Jan and rest of the months follow Calendar(1 Feb-28 Feb) as periods.Here we have cutoff date to be 31st Jan.

We have asset with Ord dep start date as 31.05.2014 with 3 years useful life.We follow straight line dep with Monthly posting.Now,in Jan 2017,we have activated period weighting and maintained the periods for Jan as 32 days and rest as per cal days.Now when i check the asset values,NBV was 163.46 which needs to be posted till useful life which is 5 months(should end in period 5) ,but after activating we see there is some minor difference of .54 being posted to period 6.When i deactivate the period weighting the planned depreciation is correctly showing the asset will end on period 5.Please find the screenshots for your reference.

I have tried different scenarios for testing but I do not see any fix for this,and I see we have to post unplanned depreciation for the assets.But considering the impact we have ,there will be many assets which need to be posted.

Please let me know your comments.

Thanks!

[Former Member]

Still waiting for inputs

[former_member205041]

Hi Varanasi,

sorry for the late answer.

Unplanned depreciation could be a solution.

Sorry, I have no alternative solution.

best regards

Bernhard

[former_member205041]

Hi Varanasi,

1) What the system is doing with the difference (adjusted for 5 months or posted in one period), depends on your settings in OAYR.

(Flag or unflag the checkbox 'smoothing' in transaction OAYR)

2) Where the minor difference of .54 comes from I can't say from here. I can see in the attachment that there happens something in the last period.

best regards

Bernhard

[Former Member]

Hi Bernhard,

I see the difference came when we activated the Period Weighting in OAYL.If we turn off the indicator then the amount is being adjusted based on the remaining useful life of 5 months(31Jan- 30May).Now,as we activated the period weighting,we have 5 months as useful life for asset and as per OB29 setup we have 5th month which will end on 31st May.So here we have conflict with Period Weighting and Asset remaining useful life.Because of this,the calculation is considering the change over method after useful life of Asset(Planned) and base method considered is 17 with Immediate dep. Here treatment of end of dep has Yes for dep after planned Life end.So I am not considering to change this indicator which might result in valuation differences across as we have multiple assets which will have same issue.

One option is to ask user to post Unplanned depreciation during 5th period end, and close the asset but this will be tedious task for end users.Looking out for alternate solution if there is any.

Please let me know your comment.

[former_member205041]

Hi Varanasi,

The question is if the minor difference of .54 is right or not.

If there is something to post, the system is going to post it - also after end of useful life.

If the system should not post anything after anything after end of useful life you can check in the depr. key

"Depr. after end of useful life: No"

So we come back to the ultimate question: Is the basic difference of .54 correct or not?

best regards

Bernhard

[Former Member]

Hi Bernhard,

Good to see your reply.As far as difference is concerned,we should not get that difference and also we are not expecting that extra period. Dep should end in period 5 and that difference need to be adjusted for 5 months in 2017.I see asset master has 5 months as remaining useful life,so considering that,the period weighting should auto calculate the dep for 5 months.Is there any way to check how system is picking useful life (If it is in Months in asset master) and mapping the same to period conversion(In case of weighting of periods is activated and days being considered).I appreciate your update.

Thanks!