Activate Fixed Asset Under Construction Proposal in (FAS660)
Activate a previously created fixed asset under construction proposal using 'FA Under Construction. Open' (FAS660). This process ensures that the total amount of the fixed asset under construction proposal is added to the total acquisition cost of the selected fixed asset.
Limitations
- When creating a proposal in (FAS660), you can only include one project in the selection.
- When activating a proposal in (FAS660), you can only select one fixed asset to receive the activated amount.
- If more than one project must be activated against the same fixed asset, you must create several proposals in (FAS660).
- If the project costs must be split between two fixed assets, you should include them in two different proposals in (FAS660).
Outcome
After activating the proposal in (FAS660), it is updated to proposal header status 90='Activated' and a voucher is created for the activation. The activation voucher reverses the postings on the fixed asset under construction account that are marked as included in the proposal, and creates a contra posting on the ordinary fixed asset account using accounting rule FA70-550.
The original general ledger transactions posted on the fixed asset under construction account are automatically reconciled against the reversal transactions created during activation. The transactions in the general ledger are updated with reconciliation code (RECO) set to 9 and reconciliation date (REDE) set to the accounting date selected for the activation in (FAS660). If the fixed asset under construction account is defined with the Reconciliation parameter (RECE) activated on 'Accounting Identity. Open' (CRS630/E), a reconciliation number (RRCB) is then assigned in FRRRCB table and updated for the reconciled transactions in the general ledger.
The original general ledger transactions posted on the fixed asset under construction account are updated with additional information number 017 in 'General Ledger. Display Additional Info' (GLS212), indicating the fixed asset that is selected upon activation of the proposal in (FAS660).
The transaction posted in the ordinary fixed asset account through the activation voucher is also updated with additional information number 017 in (GLS212). The amount of this transaction is activated against the fixed asset. If the amount is positive, the acquisition cost of the fixed asset increases at activation; if it is negative, the acquisition cost decreases.
If the fixed asset does not have a previous value, the activated amount is added for the value types used for Purchase price (VAPV) and Total acquisition cost (VATT) in 'Fixed Asset. Connect Value Types' (FAS003) and 'FA Value. Display Period' (FAS220). If the fixed asset has a previous value, the activated amount is added to the value types used for Additional cost (VAT7) and Total acquisition cost (VATT).
See also the Functionality specific for Czech Republic (CZ) and Slovakia (SK) section.
The total amount of the proposal in (FAS660) is expressed in local currency, which means that it is used to update the accounted value (FAVA) displayed in (FAS003) and the recorded amount (FAVA) displayed in (FAS220). This amount is then recalculated to the currency set for the fixed asset in 'Fixed Asset. Open' (FAS001), using the exchange rate of the fixed asset, to update the fixed asset value (FAVC) displayed in (FAS003) and the foreign currency amount (FAVC) displayed in (FAS220).
The text block connected to the fixed asset, which can be accessed through F6='Text' on (FAS003/B), is updated with information about the activation. The text block indicates the new voucher number, the accounting date, the previous amount, the updated amount, and the new amount.
The fixed asset is set to status 3='Under activation' in (FAS001) during the processing of the activation job from (FAS660). When the job is finished, the status is reset to 1='Normal fixed asset'. The voucher number and the accounting string of the activation voucher is also updated for the fixed asset in (FAS001), but only if the activation concerns the initial purchase price of the fixed asset. If additional costs are added to a fixed asset that already has a previous value, the voucher number and the accounting string are not updated in (FAS001).
VAT is recorded upon the activation of a fixed asset if the VAT code used for the fixed asset under construction account is set to 1- 'Yes, report VAT at FA activation' in 'VAT Code. Open' (CRS030).
In this process, the VAT connected to an account for a fixed asset under construction is moved from the regular VAT account to a VAT suspense account when an invoice is recorded in 'Supplier Invoice. Record' (APS100), 'Supplier Invoice Batch. Open' (APS450), or a journal voucher in 'Journal Voucher. Enter' (GLS100). The VAT suspense account is retrieved from accounting types 203 and 204. This VAT is not included in the VAT report. Once the fixed asset is activated in (FAS660), the VAT is moved back from the VAT suspense account to the regular VAT account. The net VAT debt is recorded on accounting type 207, and an offsetting transaction is created on accounting type 208 to balance the amount on 207. The transactions on the regular VAT account and the net VAT debt or liability are included in the VAT report.
Before you start
- The starting conditions listed in Create or Update the Acquisition Cost of Fixed Assets with Project Costs through (FAS660).
- You must create a fixed asset under construction proposal in 'FA Under Construction. Open' (FAS660). After the creation, review, and adjustments, the fixed asset under construction proposal can be activated when it has reached proposal header status 20='New' and proposal progress 0='The proposal can be processed'.
Workflow
- Start 'FA Under Construction. Open' (FAS660).
The B-panel is displayed, listing all the fixed asset under construction proposals.
If you are logged on to a blank division, you must select a division on (FAS660/B).
- Use related option 9='Activate' on (FAS660/B) to activate your proposal.
- On (FAS665/G), the project number, the proposal number, and the total amount of the proposal, expressed in local currency, are displayed. Specify the activation details for the proposal on (FAS665/G) as described in steps 4 to 6.
- Select the 'Fixed asset ID' and 'Subnumber' against which the proposal must be activated. Ensure that the fixed asset is in status 1 in 'Fixed Asset. Open' (FAS001).
The currency code and the exchange rate is then retrieved from the fixed asset and used as basis when the total amount of the proposal, expressed in local currency, is recalculated to the foreign currency amount, expressed in the currency of the fixed asset, that is activated against the fixed asset.
- Specify the 'Accounting date' and the 'Voucher text' fields that are used for the activation voucher.
- The accounting string stated in the fields for accounting dimensions 1 to 7 concerns the posting on the fixed asset account. This account is defined with the F/A account parameter set to 1 in 'Accounting Identity. Open' (CRS630/E) and is used as the contra posting against the reversal of the fixed asset under construction account, defined with the F/A account parameter set to 2 on (CRS630/E) in the activation voucher.
If the fixed asset does not have a previous value, this accounting string is automatically set from accounting rule FA70-550 in 'Accounting Rule. Set' (CRS395), but the user can change it manually on (FAS665/G).
If the fixed asset has a previous value, this accounting string is retrieved from the latest transaction for the acquisition cost value type for the fixed asset. The user cannot change the accounting string on (FAS665/G), since additional costs must be posted in the same accounting string as the original purchase price of the fixed asset.
- Press Enter to activate the total amount of the proposal against the selected fixed asset. A message is then displayed indicating if the amount is added to the fixed asset as initial purchase price, or as additional cost. Confirm the message to start the activation job and to return to panel (FAS660/B).
During processing, the proposal header status is 20='New' but the proposal progress is set to 9='Update in progress'.
When the job is finished, the proposal header status is set to 90='Activated' and proposal progress is reset to 0='The proposal can be processed'.
- You can validate the results of the activation by using one of these related options on (FAS660/B):
- 5='Display': Display the details of the proposal. Panels (FAS660/E) and (FAS661/B) are displayed in display mode.
- 12='Dsp voucher': Display the activation voucher on (GLS200/B). This is only available for a proposal in proposal header status 90.
- 13='Fixed Asset. Open': Display the fixed asset that was selected for the activation in (FAS001). This is only available for a proposal in proposal header status 90.
- If the activation job is interrupted while the proposal header status is 20='New' and the proposal progress is 9='Update in progress', you can restart the activation by using related option 19='Restart activation' on (FAS660/B). If this option is used, you are then asked to confirm that the job is no longer active before the job is restarted.
If the activation job is interrupted later in the processing, when the proposal header status is set to 90='Activated' and the proposal progress is reset to 0='The proposal can be processed', you must restart the job in 'Trans Work File. Restart Interrupted Jobs' (GLS047). If related option 9='Restart' is used for an activation job that originates from (FAS660), you are then asked to confirm that the job is no longer active before the job is restarted.
Functionality specific for Czech Republic (CZ) and Slovakia (SK)
For companies working in Czech Republic (CZ) and Slovakia (SK), there is a possibility to add cost to a fixed asset as a technical increase through (FAS660). Whether the activated amount is added to the fixed asset as additional cost or as a technical increase, this affects the calculation of the depreciation plans for the fixed asset, as described for the 'Value limit' (XTLV) field on 'Settings – Fixed Asset Acquisition' (FAS900/E).
To control this functionality, an additional field called 'Addition Method' (LADM) is displayed on the activation panel 'FA Under Construction. Open' (FAS665/G), when activating a proposal for a division defined for country versions CZ-'Czech Republic' or SK-'Slovakia' in 'Company. Connect Division' (MNS100).
- 0='Initial purchase price'
- 1='Additional cost'
- 2='Technical increase'
- If this field is set to 0-'Initial purchase price', the value types defined for 'Purchase price' (VAPV) and 'Total acquisition cost' (VATT) on (FAS900/E) are updated with the activated amount. These updates are applicable for fixed assets in any division, regardless of country version.
- If this field is set to 1-'Additional cost', the value types defined for 'Additional cost' (VAT7) and 'Total acquisition cost' (VATT) on (FAS900/E) are updated with the activated amount. These updates are applicable for fixed assets in any division, regardless of country version.
- If this field is set to 2-'Technical increase', the value types defined for 'Technical increase' (XTVP) and 'Total acquisition cost' (VATT) on (FAS900/E) are updated with the activated amount. These updates are only performed for fixed assets in a division set up for country versions CZ or SK in (MNS100).
- If the selected fixed asset does not have a previous value, the 'Addition Method' (LADM) field is set to 0-'Initial purchase price' and is not open for editing on (FAS665/G).
- If the selected fixed asset has a previous value, the 'Addition Method' (LADM) field must be set to either 1-'Additional cost' or 2-'Technical increase' on (FAS665/G).
- If the selected fixed asset already has an acquisition value and has been updated with a technical increase before, the 'Addition Method' (LADM) field is set to 2-'Technical increase' and is not open for editing on (FAS665/G). However, a technical increase cannot be added to a fixed asset in the same year as the fixed asset was activated according to the 'Activation date' (APER) on 'Fixed Asset. Open' (FAS001/E). Under those circumstances, an error message is received: Technical increase cannot be added to this fixed asset for an accounting date in the year of the activation date in (FAS001).
- If the selected fixed asset already has an acquisition value but no technical increase, and the accounting date is in the same year as the activation date of the fixed asset, the 'Addition Method' (LADM) field is set to 1-'Additional cost' and is not open for editing on (FAS665/G).
- If the selected fixed asset already has an acquisition value but no technical increase, and the accounting date is in a later year than the activation date of the fixed asset, the 'Addition Method' (LADM) field is open for editing on (FAS665/G). If the activated amount is greater than or equal to the amount limit defined in the 'Value limit' (XTLV) field on (FAS900/E), the Addition method field is set to 2-'Technical increase', but the user can change it. If the activated amount is less than the amount limit defined in the 'Value limit' (XTLV) field on (FAS900/E), the 'Addition Method' (LADM) field is defaulted to 1-'Additional cost', but the user can change it.
This diagram shows the validations for the addition method that results in that the activated amount is updated as either purchase price, additional cost, or technical increase when activating a proposal for a division defined for country versions CZ-'Czech Republic' or SK-'Slovakia' in (MNS100):
