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Capitalizing inventory in IFRS LEdger

Former Member
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235

Hi

There are some materials which i need to capitalize the in IFRS ledger. It means as per IGAAP it will be in inventory stock and in IFRS it will be in fixed asset schedule

I will create one separate asset class and create asset master. But how to post the transaction only in IFRS ledger i.e. debiting asset and crediting material.

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Answers (1)

ajaycwa1981
Active Contributor
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Hi Meenu

I dont think this is possible....

MM and Asset Accounting is integrated with your Leading Ledger....

a. If you consume the inventory and convert it into FA, it will apply to both the ledgers first of all, and not just IFRS ledger

b. If IFRS is not your Book Dep Area, then also you cant just capitalize an asset in the Non-Book dep area...

As a work around (I did this in a real estate client for some other purpose),

a. Create a new asset class...

b. The description of the Asset APC recon account in Dep Area 01 to be Kept as Inventory Account and club this with the Inventory Accounts in your FSV.... For the IFRS dep area, you can have a different APC recon account, if it manages APC values as well

c. Issue the material to FA using 241 movement type... The Material will be converted into Fixed Asset technically for the purpose of both the ledgers.. However, it will reflect under Inventory GL in IGAAP and under FA in IFRS ledger

d. Choose proper dep key in each area.. If the IGAAP dep area is not be depreciated immediately, choose Dep Key 0000

You will also have to think how will you consume the inventory later on because the inventory would have depleted from MM books... In my opinion, post unplanned dep on Dep Area 01 whenever you want to Consume the inventory,....

Br, Ajay M