assets management concepts & theories
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Assets Management Concepts & TheoriesTRANSCRIPT
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AssetsAssets ManagementManagement
EGN 5622 Enterprise Systems Integration EGN 5622 Enterprise Systems Integration
(MSEM, Professional)(MSEM, Professional)Fall, 2013 Fall, 2013
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Assets ManageAssets Management ment
Concepts & TheoriesConcepts & Theories
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Asset AccountingAsset AccountingConcerned with tracking the financial
consequences associated with the entire lifecycle of an asset, from acquisition to disposal (retirement).
Assets can be categorized as tangible, intangible, and financial
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Asset Accounting ClassificationAsset Accounting ClassificationTangible assets
◦ Fixed assets◦ Leased assets◦ Assets under construction
Intangible assets◦ Intellectual property◦ Patents◦ Trademarks
Financial assets◦ Securities◦ Long term notes (debts)◦ Mortgages
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Asset Accounting ComponentsAsset Accounting ComponentsAsset Asset
accountingaccounting
Intangible Intangible assetsassets
Tangible Tangible assetsassets
Financial Financial assetsassets
- Fixed assets- Fixed assets- Leased assetsLeased assets- Assets under Assets under constructionconstruction
- Intellectual Intellectual propertyproperty- PatentsPatents-TrademarksTrademarks
- SecuritiesSecurities- Long term Long term notes (debts)notes (debts)- Mortgages- Mortgages
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Asset Accounting in corporate Asset Accounting in corporate financial structurefinancial structure
Chart of AccountsGeneral Ledger Accounts
◦Balance sheet accounts◦Income statement accounts◦Reconciliation accounts
Subsidiary ledgers (sub ledgers)◦Accounts Receivable (customers)◦Accounts Payable (vendors)◦Assets
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Asset AccountingAsset AccountingAssets are assigned to
◦ company code◦ Business area
Accounting data of assets are maintained in asset sub-ledger accounts.◦ E.g. Acquisition costs and depreciation
Asset sub-ledger accounts are created when asset master record is created and associated with a reconciliation account in the general ledger
Sub-ledger account and the master record share the same account number
Companies maintain separate reconciliation accounts for different types of assets
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Example of Asset Accounts in GLExample of Asset Accounts in GL
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Asset Accounts (AA) Structure Asset Accounts (AA) Structure ExampleExample
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Asset Management (Lifecycle)Asset Management (Lifecycle)Asset master Asset master creation (AA)creation (AA)
Vendor masterVendor master
Outgoing Outgoing paymentpayment
Asset Asset Transfer (AA)Transfer (AA)
Within/outsideWithin/outsideCompany codeCompany code
Asset Asset AdditionAddition
(AA)(AA)
Asset Asset Acquisition Acquisition
(AA)(AA)Vendor invoiceVendor invoiceExternalExternal
Cost centerCost center
Asset Asset ReportReport (AA)(AA)
Customer/ScrapingCustomer/Scraping
Depreciation Depreciation ChargeCharge
Asset Asset RetirementRetirement
(AA)(AA)
Customer Customer PaymentPayment
Customer Customer InvoiceInvoice
Customer Customer MasterMaster
Business Business AreaArea
Plant/locationPlant/location
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Major Activities in Asset Major Activities in Asset Management (Lifecycle)Management (Lifecycle)Asset AcquisitionAsset DepreciationAsset Retirement
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Asset AcquisitionAsset AcquisitionAsset acquisition is concerned with acquiring assets
via internal or external processes◦ Internal:
production process or project systems
◦ External: 3 external options for purchasing assets, Purchase from an established vendor using the purchasing process
(different GL accounts) Purchase from an established vendor without using the purchasing
process (manual entry in GL and sub-ledger; similar to AP accounting) Purchase from a one-time vendor or a vendor for whom master data
are not maintained (via clearing account).
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Asset Acquisition With a Clearing Asset Acquisition With a Clearing AccountAccount
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5,000 3
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Asset DepreciationAsset DepreciationAsset depreciation is concerned with the
decrease in the value of an asset over timeDepreciation can be planned or unplannedDepreciation methods are used
◦Straight line◦Double declining balance
Useful lifeResidual valueBook valueDepreciation areas: parallel valuation
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Straight Line DepreciationStraight Line Depreciation
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Double Declining Balance Double Declining Balance DepreciationDepreciation
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Financial Statements Based on Financial Statements Based on Depreciation Areas (parallel Depreciation Areas (parallel valuation)valuation)
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Asset RetirementAsset Retirement
Concerned with the disposal or retirement of an asset after its useful life
Retirement may be:◦Revenue generating (sold)◦Non-revenue generating (scrapped)
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Asset ExplorerAsset ExplorerAsset explorer provides an overview of all
activities related to the asset, including:◦Acquisition data◦Planned and posted depreciation◦Drill-down details for:
Master data Transactions Documents
◦Depreciation posting run (for an assumed useful life)
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Asset ExplorerAsset ExplorerThe asset explorer can:show all the values of a fixed assetdisplay various forms of summarized
information for decision makingdisplay connections from the Asset
Explorer to the G/L accounts, vendor accounts, the cost center, and the Purchase Order of the Asset
display planned values are, as well as values already posted for analyzing asset values
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Asset Explorer InterfaceAsset Explorer Interface
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Asset management linked to Asset management linked to financial accountingfinancial accounting
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Assets ManagementAssets Management
SAP Implementation SAP Implementation
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R/3
SAP Module ViewSAP Module View
Integrated SolutionClient / Server
Open Systems
FinancialAccounting
Controlling
Fixed AssetsMgmt.
ProjectSystem
Workflow
IndustrySolutions
ProductionPlanning
Sales &Distribution
MaterialsMgmt.
HumanResources
PlantMaintenance
QualityMgmt.
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Create Asset MasterCreate Asset Master
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Create Asset MasterCreate Asset Master
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Purchasing an AssetPurchasing an Asset
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One way to skip the step of creating an Asset in the books is to directly go to the Purchase Order, and click the button pointed to.
Purchasing an AssetPurchasing an Asset
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Receiving an AssetReceiving an Asset
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Invoicing an Asset Invoicing an Asset
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Asset Explorer (Comparison)Asset Explorer (Comparison)
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Asset Explorer (Parameters)Asset Explorer (Parameters)
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Asset Explorer (Simulation)Asset Explorer (Simulation)
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Asset Explorer (Simulation)Asset Explorer (Simulation)
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Features of the Asset ExplorerFeatures of the Asset Explorer
Header: where you enter the company code and asset number (Structure)
Overview tree: allows you to navigate between the different depreciation options
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More Features of Asset More Features of Asset ExplorerExplorer
Overview tree: displays objects that are related to the asset
Tabs: allows you to analyze the planned values and posted values using different parameters, as well as compare fiscal years and depreciation areas
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SAP SAP IDESIDES Client, Userid, Password Client, Userid, Password Exercises for Assets Management:
Client: 145Application server: riga.cob.csuchico.eduSystem number: 76System ID: RGA
Userid: ides-025 to ides-047Initial Password: SAP4US
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© SAP 2008 / SAP University © SAP 2008 / SAP University Alliances Page Alliances Page 3838
HW Assignment HW Assignment (Due date 9/21/2013)(Due date 9/21/2013)
1.Create appropriation request2.Create asset 3.Create a vendor 4.Create an information record to link the vendor
and the asset5.Create a purchase order for the asset6.Check the asset and accounting records7.Make assets receipt against purchase order8.Enter incoming invoice9.Post outgoing payment10.Use asset explorer