This is my first blog I am contributing to the SAP world. Since I started my SAP career, I believe SAP community has given everyone vast space to learn and explore new things in the SAP world. My sincere thanks to those who contribute and share their experience and knowledge to make others’ life easy and help them to learn and grow in their jobs.
So now I decided to write something where I got some good exposure and understanding. As this is my first blog, I request all the audience to give me their valuable feedback so the next time I can write a blog considering the feedback I will receive on this blog
In this blog, I tried to give an overview of Intracompany Asset transfer, but my main purpose is to explain the cross-system depreciation area and its use. But, to understand that first we need to understand the intracompany asset transfer process.
Intercompany asset transfers: Intercompany transfer means the transfer of assets from the books of one company code to another company code. For the companies involved in the intercompany transfer, an intercompany transfer represents a retirement for the sender company and an acquisition for the receiver company. It is typically representing a transfer that balances to zero in the asset history sheet for the sender company and shows asset acquisition in the asset history sheet of the receiver company.
An Intercompany asset transfer may be required for one of the following reasons:
- The organizational structure of the corporate group has changed, requiring reassigning the asset to another company code
- The physical location of the asset has changed, making it essential to assign the asset to a new company.
If you want to transfer an asset from one company to another, it is not possible to change the organizational assignment of the asset by changing the master records. To transfer an asset, we need to have an asset master record created in receiving the company code.
As an asset, intercompany transfer represents the retirement of one asset in sending the company code and the acquisition of another asset in receiving the company code. Hence, different sets of transaction types are required for acquisitions and retirements that will be used during the transfer process.
SAP has provided all relevant transaction types, but we can configure custom transaction types based on the requirement. Best practice, if you want to configure or change transaction types, never modify the standard transaction types instead, copy the standard transaction type that most closely meets your needs and create a new transaction type in the custom name range, starting with Z or Y.
Now we have got a basic understanding of Intercompany asset transfer now let’s see, what are the possible ways to transfer assets from one company code to another.
Basically, there are 2 ways to do the intercompany asset transfer.
Automatic Intercompany Transfer (ABT1N): With the use of this transaction code, asset get retired in the sender company code and acquisition get posted in the receiver company code in one step. The prerequisite asset master record must exist in the receiver company code to post the transaction. However, in the transaction code, ABT1N SAP has given the option to create an asset master record in receiving the company code during the posting intercompany transaction itself.
Manual Intercompany Asset Transfer: In this process, 2 steps need to be performed, the retirement of an asset in the sender company code and acquiring an asset in receiving company code. SAP has provided different transaction types which identify the transactions performed. Transaction types relevant to intercompany transfer can be used while posting the retirement of an asset in the sender company code and acquisition in the receiver company code.
Step 1: Retirement of an Asset in the sender company code: The asset needs to be retired in the sender company code by using standard transaction code ABAON, while posting the retirement of an asset, we need to ensure the trading partner field must be updated with receiver company code information. By populating the trading partner in the retirement transaction, it will call the relevant transaction type and the trading partner will be updated in the retirement posted document.
Step 2: Acquisition of an Asset in the receiving company code: The asset needs to be acquired in receiving company code using standard transaction code ABZP, while posting an acquisition using the ABZP transaction code we need to ensure the trading partner field must be populated with sender company code information. By populating trading partner in an acquisition transaction, it will allow using transaction type of acquisition from affiliated company code. ABZP is specifically defined for acquisition from affiliated company code.
There are 2 ways to transfer asset values from the sender company code to the receiver company code, depending on the reason for the transfer and the association between the company codes, acquisition of the transferred asset can be posted either gross (with its historical APC and value adjustments which include accumulated depreciation, if any) or net (with its net book value, no accumulated depreciation). Therefore there is a special indicator defined in the transaction types. This indicator indicates whether the transaction type is for posting to affiliated companies and if the posting is gross or net.
The indicators discussed here only apply to the manual intercompany transfer (2nd category) for automatic intercompany transfer (1st category), these things will be managed by the transfer variant. In automatic transfer (ABT1N) net or gross transaction types are controlled by the variant selected in intercompany transfer transactions.
Pros of the Automatic Transfer
- In a single transaction code, both actions get executed retirement of an asset from the sender company code and the acquisition of an asset in receiving company code.
- Trading partner get populated automatically in the posted documents of both the company codes
- Intercompany documents get generated where we can see both the documents, retirement in sending company code and acquisition in receiving company code.
- The intercompany transaction (ABT1N) screen has the option to create an asset master on the fly.
- Asset values automatically get calculated and converted in the receiving company code currency based on the values provided for an asset in sending company code using the exchange rate maintained in the system.
- We have the option to select partial or full retirement during the execution of the transaction code.
- Values transfer (Gross or Net) controlled by transfer variant.
Cons of the Automatic Transfer
- If depreciation areas in both the company codes do not have the same valuation purpose, then we need to configure cross-system depreciation areas.
- If depreciation areas have the same valuation purpose, but one of the company codes (sender or receiver), then also we need to configure cross-system depreciation areas.
Pros of the Manual Transfer
- Standard transaction ABAON can be used to retire an asset in the sender company code and ABZP can be used for acquisition from affiliated company code.
- Partial retirement is possible using standard transaction ABAON.
- If depreciation areas have different valuation purposes or the number of depreciation areas are different in sender and receiver company codes, the manual transaction can be used without any other configuration as retirement and acquisition are performed separately in the respective company codes.
Cons of the Manual Transfer
- Two different transaction codes need to be executed in respective company codes.
- Values transfer (Gross or Net) are controlled by transaction types which need to be selected manually while performing retirement in sending company code and acquisition in receiving company code.
- The trading partner needs to be populated manually in both transaction codes, retirement in sending company code (ABAON) and acquisition in the receiver company code (ABZP).
- Acquisition values need to be manually converted in receiving company codes currency.
Reversal Of Intercompany Transfer Transactions
You can reverse automatic intercompany asset transfers, like any other asset transaction reversal, using the normal reversal function (AB08) in Asset Accounting. The system then perform reversal of retirement postings in sending company code and the acquisition postings in the receiving company code.
If a new asset for intercompany transfer was created in the receiving company code, you can restrict postings in this asset by block the asset using transaction code AS05.
For manual intercompany transfer, reversal needs to be perform separately of retirement and acquisition in the company code in which they were executed.
Now, I guess this blog has given a good understanding of intercompany asset transfer. In the next blog, I will try to explain cross system depreciation area and use the cross-system depreciation area in intercompany asset transfer.
Thank you readers for sparing time to read my blog. I would like to hear your feedback or thoughts on this blog. Please provide the same in a comment.