IFRS_Configuration Guide Using Parallel Ledger V1.0

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]

mailto:[email protected]



Page 2

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



Page 3

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.



Page 18

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



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.

IFRS_Configuration Guide Using Parallel Ledger V1.0

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