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Diminishing/Declining Method for Chart of Depreciation IFRS

Andro
Explorer
0 Kudos
212

Good day,

The business has activated ledger IFRS and according to IFRS.org the following depreciation methods are supported - straight-line method, the diminishing balance method and the
units of production method. However, we cannot find any depreciation keys that supports the diminishing balance method assigned to the Chart of Depreciation IFRS. We do see the declining method as part of Chart of Depreciation 3010.

As per IFRS.org (link) the business requires the ability to assign the diminishing/declining method to the IFRS Chart of Depreciation/Depreciation Area as well, not just the Local AU Chart of Depreciation 3010.

Kind regards,

Andro

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Mick
Product and Topic Expert
Product and Topic Expert
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Hi Andro,

Yes, we are aware that IFRS allows diminishing depreciation method. However, this is used extremely rarely. Thus we decided not to add such a method to our default pre-delivery content. I recommend to either go for straight-line depreciation (best business practice) or usage of production depreciation method in case it needs to be more detailed.

If you are still convinced to use the diminishing method, you can apply for a custom depreciation key via this process: Verify Configuration for Fit-to-Standard Workshop for SAP S/4HANA Cloud

Best regards,

 Mick

Andro
Explorer
0 Kudos
Thanks Mick, we have gone with expert configuration option.