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8/12/2019 IFRS_Configuration Guide Using Parallel Ledger V1.0
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Configuration Document
IFRS by using Parallel
Ledger
Prepared By : Vivek Srivastava
E-mail : [email protected]
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Contents
Introduction 3
Scope of Document............................................................................................................................................................. 3
Non-Leading Ledgers 4
Define Ledgers for General Ledger Accounting ..................................................................................................... 4
Define & Activate Non Leading Ledger ...................................................................................................................... 5
Assign Scenarios and Customer Fields to Ledgers ................................................................................................ 6
Document Types ................................................................................................................................................................. 7
Document Type for Entry View in a Ledger ............................................................................................................ 9
Balance Display as per Characteristic ...................................................................................................................... 11
Creation of Depreciation Areas 12
IFRS Depreciation Area .................................................................................................................................................. 12 Specify Account Assignment ........................................................................................................................................ 17
Maintain Depreciation Key ........................................................................................................................................... 19
Specify Transaction Type for Asset Accounting ................................................................................................... 22
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Introduction
Scope of Document
This document explains the necessary configuration steps for the New GL purpose. The steps described
have been used to:
1. Activate Parallel Ledger
2. Design process for smooth execution of business processes for the new ledger
3. Design asset related transactions to meet IFRS requirements
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Non-Leading Ledgers
This section will elaborate the configuration required for setting up parallel ledger.
Define Ledgers for General Ledger Accounting
In this IMG activity, ledgers are defined to be used in General Ledger Accounting. The ledgers are based
on a totals table. SAP delivered standard totals table FAGLFLEXT has been used for this purpose. After
activation of New GL, one non-leading ledger 1L has to be created.
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Define & Activate Non Leading Ledger
Ledger 1L has been created for IFRS and has been activated for the company code 5500. Same currency,
posting period variant and fiscal year variants have been used as those used in the company code for
the existing leading ledger.
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Assign Scenarios and Customer Fields to Ledgers
Scenarios determine what fields in a ledger are updated when it receives posting from other application
components. Scenarios are assigned individual Ledger-wise. Presented below is the screenshot of
scenario assignment for the parallel leading ledger.
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Document Types
Document types are used to differentiate the business transactions and to manage how document are
stored. Since the majority of postings have the same effect in all ledgers, document types are defined
here for the entry view for postings that affect all ledgers. Also a unique number range is assigned to
each document type. By segregating the ledger-related postings (here, the leading ledger) in a separatenumber range, we ensure contiguous assignment of document numbers at the ledger level for each
number range.
One separate document type can be created for IFRS Purpose & ZF has been created for this purpose.
This document type would be dedicatedly used for ledger-specific posting to the non-leading ledger.
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Document Type for Entry View in a Ledger
Asset related posting would also take place in the non-leading ledger. Hence, asset document types (AA
and AF) along with ZF are extended in the non-leading ledger with corresponding number range.
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Balance Display as per Characteristic
Under this section, it can be specified which characteristics are available for the ledgers as selection
characteristics when displaying balances.
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Creation of Depreciation Areas
IFRS Depreciation Area
For the purpose of IFRS Asset reporting requirements, following two depreciation Areas have been
created:
Area Name of Depreciation Area Real GL Target Group
60 IFRS Depreciation Area Yes 3 1L
80 Delta Depreciation Area No 6 1L
For parallel financial reporting (that is, valuation based on different accounting principles) separate
types of depreciation areas can be defined – real depreciation areas and derived depreciation areas. The
values in the derived depreciation area are calculated from the values of two or more real areas, using a
formula to suit specific business requirement. The system does not store the values from the derived
depreciation area. Instead they are determined dynamically at the time of a request.
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Specify Account Assignment
By this configuration, the asset transactions will derive the account assignment assigned in the asset
master. Configuration has to be done for the company code 5500.
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Next, the account determination determines the reconciliation accounts in the general ledger, as well as
their offsetting accounts, that are to be posted when certain business transactions are carried out.
Account determination must be entered in the asset class. Several asset classes can use the same
account determination, if they use the same chart of accounts and post to the same general ledger
accounts.
Below is the depiction of all Account Determinations used in the company code 5500 and chart of
depreciation 5500.
Now, each account determination object would have a group of accounts assigned under it which will
get hit during different asset transactions. Existing accounts, used for book depreciation area (01) has
been used as a point of reference. Below is a sample elaboration for one of the account determinationobjects and similar activity has been carried out for all other objects.
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Maintain Depreciation Key
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In this step, depreciation keys are maintained by assigning calculation methods to them. Depreciation
keys contain the calculation methods for depreciation calculation and parameters that control ordinary
depreciation, for the purpose of IFRS related asset configuration in 5500. Separate depreciation key can
be maintained for each depreciation area in the asset master record. The duration of depreciation can
be divided into several phases. When a changeover method is entered for one of these phases, the
system changes over to the next phase as soon as the event specified in the changeover method occurs.
The system then uses the depreciation calculation that is specified in the calculation method for the
next phase.
Two depreciation keys are created for IFRS namely HB11 and HB12. Both uses the principle of
depreciation based on remaining useful life in accordance with IFRS. Only difference is that for HB12
depreciation is being calculated to the exact day, whereas for HB11 it is calculated according to the
period controls indicated in the depreciation key setting.
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Changeover method 5 – Changeover after end of the useful life – is necessary here since declining-
balance method of depreciation is used and it has to be ensured that a net book value of zero is reached
at the end of useful life.
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Specify Transaction Type for Asset Accounting
Custom Transaction Type for Acquisition
In the step "Transactions" configurations are made for the posting of transactions in Asset Accounting. It
is especially important to define transaction types. Here, transaction types for asset acquisitions are
defined. A transaction type has to be entered for each posting activity that is relevant to Asset
Accounting. Transaction types classify the different types of accounting transactions in Asset
Accounting.
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Here two transaction types are defined as below:
These transaction types are designed with reference to the standard transaction type for acquisition
(100), one for debit and the other for credit purpose. The details of these transaction types are as
below:
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It can be also specified that for certain transaction types, only certain depreciation areas will be
proposed for posting. The system then creates a popup window in the posting transaction, showing the
depreciation areas that can be posted. These transaction types are restricted for the IFRS depreciation
area (60) only.
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Custom Transaction Type for Retirement
Here, transaction types for asset retirements are defined.
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Here 2 transaction types are defined as below:
These transaction types are designed with reference to the standard transaction type for retirement
with and w/o revenue. The details of these transaction types are as below:
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It can be also specified that for certain transaction types, only certain depreciation areas will be
proposed for posting. The system then creates a popup window in the posting transaction, showing the
depreciation areas that can be posted. These transaction types are restricted for the IFRS depreciation
area (60) only.
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Use of IFRS in Fixed Asset
1. Asset Acquisition
New Asset acquired
2. Depreciation run is executed – AFAB
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Depreciation posted:
3.Depreciation Accounting Document – FB03
This will show the total Posted Depreciation document, the column “S” shows that the document posted
in Leading Ledger or not, if it is “L” then the entry is not posted in Leading Ledger and it is Differential
Posting, please refer above screenshot where the document with 3 Series for the normal Depreciation
document and with 5 series the document which are posted for differential amount
Now the depreciation got successfully posted
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4. Capitalize Asset in IFRS Depreciation Area
Transaction Code ABSO can be used for acquiring asset in IFRS Dep. Area with custom Transaction Type
Custom Trans. Type Std. Trans. Type Purpose
Z10 100 (Dr.) External Asset Acquisitio
Z20 100 (Cr.) External Asset Acquisitio
Z30 200 Retirement w/o revenue
Z40 210 Retirement with revenue
The Posting date will be the date on which the IFRS is introduced; by posting the above entry system will
post entries in IFRS depreciation area.
The above entry will post only to Asset Accounting, now for posting for Financial Accounting transaction
code ASKBN can be used.