SAP ERP Financials and FICO Handbook

250 CHAPTER 6 FICO QUICK TOUR
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To comply with different legal and managerial requirements,
you often adopt different methods of calculating depreciation.
Depreciation areas take care of this requirement. One depreciation
area takes care of one type of depreciation. In SAP R/3, you can
define up to 99 depreciation areas. Through transaction code
OADB you can add and delete depreciation areas.
When you have parallel currencies, you have to define one
depreciation area for each currency. These depreciation areas
should be identical to the book depreciation areas.
Derived depreciation areas are special depreciation areas that
derive their values from one or more.
You can add or delete depreciation areas in AA. However, if you
want to delete a depreciation area from a COD, the depreciation
area in question should fulfill the following preconditions:
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The depreciation area should not be a master depreciation area.
There should not be any posting in that depreciation area.
The depreciation area should not be a reference depreciation area
for a derived depreciation area.
Through transaction code AS90, you can determine
various accounts to be used for G/L account posting. This
automatic account determination happens based on the
COD, COA, account determination, and depreciation area.
Transactions posted in the AA module update the APC cost in
the book depreciation area and change the forecast depreciation
in real time. Periodically, you will run a depreciation run,
which posts APC costs to other depreciation areas and updates
depreciation.
Due to changes in the business process, you may find that
depreciation was understated or overstated. To handle this
type of situation, SAP solutions provide two methods: (1) the
catch-up method and (2) smoothing. With the catch-up method,
the system will calculate the differential depreciation by