Asset Revaluation & Impairment IFRS - IAS 16, IAS 36 and IAS 38

[Former Member]

Hello SAP Experts,

We are implementing IFRS - IAS 16, IAS 36 and IAS 38 and have found it impossible to customise it using standard functionality. I have implemented oss notes 1144500 & 1254413 but have not been able to arrive at a solution.

We use indexation revaluation and need SAP to do the following:-

1-     When an Asset is Impaired the impairment figure should be posted to an impairment account. The standard accounts determined in AO90 allows only accounts Revaluation APC and Offsetting account. This setting posts the Impairment amount to the revaluation account.

2-     The opposite side of the impairment is required in the Unrealised revaluation account until the reserve for this asset reaches zero thereafter the the value is charged off to the income statement account.

3-     When the indexation changes the already posted depreciation then the new depreciation to required to be posted as Backlog depreciation.

Has anyone any ideas - Please

Many thanks in advance

Mina Rix

[Former Member]

This message was moderated.

[Former Member]

This message was moderated.

[Former Member]

Hello SAPers

Spoke to SAP yesterday, looks like we can not automate the postings to different accounts based on uplift or Impairment. We will need to manage the requiremnt using queries.

Closed.

Kind regards

Mina

[nishan_dev]

Mina,

There is work around;

T-code :- AR29N.

Don't be mislead by the name 'Revaluation'...you can use if for impairments too.

In both scenarios, revaluation and impairment, you are required to adjust APC and accumulated depreciation.

Did you try this ?

Thanks,

Nishan Dev

[Former Member]

Hello Nishan,

Firstly thank you for your suggestion and response.

I hope you dont mind me giving you a little background on the process used here and what I am trying to do.

We are a Trading Fund and use indexation to revalue upwards/downwards or impair specific asset class. The index is updated annually and the real area which manages revaluation; calculates and posts the revalued APC at the year end and the revalued depreciation is posted monthly in the current FY. Backlog depreciation is also calculated in the real area and posted for the previous year FY.

So all the revaluation activites are posted automatically via AFAB and therefore we don't use revaluation measure. My understanding of AR29N is that annually assets are revalued based on the measure date and the Asset Module is updated and GL posted when AFAB is excuted.

In the account determination the off-setting accounting KTAUFG is credited  when the asset is revalued upwards and debited when the asset is revalued downwards and this is correct. However when the surplus reserve for that asset is zero the downward revaluation is classed as impairment and is required to post to a different account.

Have you come accross this before?

Also, do you know how the virtual area is supossed to be used?

Many thanks in advance

Mina Rix

[nishan_dev]

Dear Mina,

I am trying to understand your business process, but meanwhile here is the answer for Virtual Depreciation Area Setup.

Virtual Depreciation Area are setup when, there is a difference between the amounts of depreciation calculated for the historical cost and for the current value of the asset. This difference has to be debited to the revaluation reserve account and credited to the capital adjustment account (CAA). So that the system can post the difference to these accounts automatically, you need to create a virtual depreciation area as described below.

http://help.sap.com/erp2005_ehp_02/helpdata/en/d2/a525bde0b148dfa6c11c19b91d716b/content.htm

Meanwhile you also view the above URL and see if you get any clue which fits your setup or requirement.

Best Luck,

Nishan Dev

[Former Member]

Dear Nishan,

Thank you for the the explanation on virtual area.

SAP has also suggested to me to look at oss note 1356846 which is specific for HMRC as they also use MHCA method. Will let you know how I get on.

Kind regards

Mina