Table of contents
1 Objective and Scope
1.1 Objective of this Procedure
1.2 Scope
2 Reference Documents
3 Definitions
4 Responsibility
5 Subsidies in SAP
5.1 Master Data Maintenance
5.2 Posting of Subsidies
5.2.1 ABIF
5.3 Corresponding postings in PS

Objective and Scope

Objective of this Procedure

The purpose of this document is to standardize and harmonize the customizing and procedure of investment grants/subsidies posting.

Scope

This operating procedure (OP) describes the steps to be done to prepare and perform subsidies postings in PF2 (ERP) as well as WP2 (RCS).

Reference Documents

(N/A)

Definitions

SBS SU MAC Service unit management accounting   
GBU Global Business Unit
APC Acquisition/Purchase Cost
WBS-element Work Breakdown Structure Element
Investment Grants or Subsidy: amount granted by public institutions or third party to support an investment project.

Responsibility

GBU supported by local organization examines if and how subsidies will be granted for investment projects. In case of subsidies to be received, GBU has to provide the agreements and documentation to Technical Controller (for PF2 companies) or SBS SU MAC I&D key user (for PF2/WP2 companies). Technical Controller respectively SBS SU MAC I&D key user have to prepare necessary WBS-elements as well as asset master for subsidy postings. They have to support the local management in case of an audit (e.g. by local authorities) by providing the appropriate SAP reports.
Depending on the specifics of the agreement, the subsidies have to be posted at the due date (e.g. as a receivable when the asset is ready for use) and not at the cash-in date.

Subsidies in SAP

Posting and documentation of subsidies granted for investment projects are standard procedures in SAP.
Depending on the country or subsidy specifics, three different types have to be distinguished:

1. Subsidy to be capitalized in IFRS and Local GAAP
2. Subsidy to be capitalized in IFRS and to be reported on liability side for Local GAAP
3. Subsidy to be capitalized in IFRS and to be reported as profit in P&L for Local GAAP

Master Data Maintenance

First step in SAP is always to determine the appropriate investment support key and to maintain the asset master accordingly. In the asset master, on tab "Allocations" you will find in the sub-tab "Investment support measures" the field "Key":

Clicking on the match-code button of "Key"…

…you will get the full list of selectable keys per chart of depreciation (example in PF2):





The list in WP2 less exhaustive:


The appropriate key has to be selected and the updated master data to be saved.

Posting of Subsidies

Two SAP standard transactions exist for posting of subsidies: ABIF and AR11 . They can be either perform by SBS SU MAC.

ABIF

ABIF has to be used for posting of individual amounts on individual assets. The transaction is available in both systems, PF2 as well as WP2.

ABIF posting in WP2

To start a posting with ABIF, following selections have to be made:
Company Code
Asset Number
Document Date
Posting Date and period
Transaction Type
The transaction type always depends on the investment key and the period of the related acquisition cost:

Following entries have to be made in the posting screen:
Amount
Asset Value Date
Offsetting Account (see posting schemes in the EXCEL file attached)
Text
Assignment
Reference

Before executing the posting, click on simulation , flag the line with the P&L account and check by clicking on "Additional Account Assignment" if a cost center has been added by default:


Finally click on "Post" .

ABIF posting in PF2

The principle of posting procedure in PF2 is exactly the same as in WP2. The only differences are the investment keys and related transaction types. 

AR11 posting in PF2

ÁR11 is used to make subsidy postings on several assets via batch input. This is currently not prepared in WP2. Prerequisite is the customizing of investment keys – as well as corresponding transaction types – with a fixed percentage. The asset master has to be prepared like described above (see 5.1). 
Parameter like posting date, document date, asset value date, transaction type etc. have to be selected comparable to ABIF. A range of assets, all assets of an entire cost center, plant or location can be selected and posted in one shot.
Before executing the posting, don't forget to remove the "Test Run" flag and make sure that the document type selected is AA.

Corresponding postings in PS

To reflect the reduction of acquisition cost of assets in PS and to align the capitalized cost in PS and FI-AA, special "statistical" postings have to be performed. For this purpose a special asset under construction (asset class in PF2 ZXX93000 and AC219199 in WP2) as well as a WBS-element for subsidies has to be created. 
This WBS-element, linked via settlement rule with the special asset under construction can also be used to "park" temporarily subsidies received already before the final assets are completed. In such a case the sequence of steps below has to be changed (2. – 3. – 1. – 4.).
The principle of postings to be performed is always the same:

1. Posting of subsidies on assets (ABIF or AR11) vs. P&L account
2. Posting on vendor account vs. WBS-element
3. Settlement from WBS-element on asset under construction (CJ88)
4. Settle asset under construction (investment measurement) to special asset under construction (CJ88)
5. Balancing of special asset under construction vs. P&L account (AB01)

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End of document