Appendix: Multi-GAAP Support Example Scenarios

Scenario 1: IFRS16/ASC842 (Ledger Approach)

In this scenario, all postings are ledger-specific postings. The fundamental logic in this scenario is based on the following triangulation: Accounting Principal – Ledger – Depreciation area.

As a prerequisite, it is mandatory to establish these links in the SAP ERP via standard configuration, which is later replicated in Nakisa Lease Administration via out of the box sync process. Additional configuration in Nakisa Lease Administration is expected in order to specify GL accounts per accounting principal and classification.

Every accounting posting is either Ledger or Depreciation area-specific. Depreciation area-specific postings are done into specified GL accounts based on the standard account assignment configuration in SAP Asset Accounting. (See diagram below)

Refer to the diagram and explanations officially published by SAP: https://help.sap.com/doc/saphelp_erp2005/6.0/en-US/4f/71db80448011d189f00000e81ddfac/content.htm?no_cache=true

For example, IFRS16 is linked to Ledger G1 and Depreciation area 01.

  • Asset capitalization posting will be done only in depreciation area 01. (Note: for SAP ECC instances transaction type for posting asset capitalization should ensure postings in depreciation area 01)
  • Liability obligation and accruals will be posted in ledger G1.

Scenario 2: IFRS16/ASC842 (Accounting Approach)

In this scenario, all postings are account specific postings. All postings are done in the main Ledger in the SAP ERP in dedicated GL accounts. Configuration should be done in Nakisa Lease Administration to define account determination keys.

Asset-related postings remains Depreciation area-specific based on the link established between Accounting Principal and Depreciation area in Nakisa Lease Administration. Depreciation area-specific postings are done into specified GL accounts based on the standard account assignment configuration in SAP Asset Accounting.

Liability postings are account-specific. Accounts are derived base on the account determination key created for the specific accounting principal, contract type, and classification type.

Scenario 3: Multi-GAAP management in one contract (IFRS16 & ASC842 Finance leases) (IFRS16 & ASC842 Operating leases)

This scenario covers parallel calculations for two accounting principles where the contract is classified as finance lease according to both accounting principles or finance lease as per IFRS16 and operating lease as per ASC842.

In case of Ledger approach fundamental logic in this scenario is based on the following triangulation: Accounting Principal – Ledger – Depreciation area.

Each Accounting principal should be linked to their own Depreciation area and Ledger. Postings are done in parallel per accounting principal. Asset postings are done in the specified depreciation area linked to the accounting principal. Liability postings are done in the specified ledger linked to the accounting principal.

As a prerequisite, all links between Accounting principal – Ledger – Depreciation area should be done in SAP ERP standard configuration, which will be replicated in Nakisa Lease Administration via the standard sync process. Additional configuration in Nakisa Lease Administration is expected to specify GL accounts per accounting principal and classification.

Every accounting posting is either Ledger or Depreciation area-specific. Depreciation area-specific postings are done into specified GL accounts based on the standard account assignment configuration in SAP Asset Accounting (see diagram below). Different GL accounts should be assigned per depreciation area.

An Asset master record is created using the following logic:

  • Asset Master record is created by asset class and company code.
  • Different asset classes should be used for Finance and Operating leases.
  • One Asset Master record is created for both valuations. One Asset Master Record belongs to one asset class, as a result, only one account determination key is used in the account assignment process in SAP AA. The available combinations for asset class usage during Asset master record creations are as follow:
    • IFRS16 + ASC842 Finance = Asset will be created as per leading standard set up in Nakisa Lease Administration. For example, Asset class 1512 (IFRS16 leading standard) and Asset class 1501 (ASC842 Finance non-leading standard) – asset MR will be created under Asset class 1512. As a result, Account Determination Key for asset related postings will be “1500001”.
    • IFRS16 + ASC842 Operating = Asset will be created as per ASC842 Operating lease. For example, Asset class 1512 (IFRS16 leading standard) and Asset class 1511 (ASC842 Operating non-leading standard) – asset MR will be created under Asset class 1511. As a result, Account Determination Key for asset related postings will be “1500002”.
  • Different account determination keys should be used in order to ensure proper disclosure as per the examples provided above.
  • Asset class mapping should be done in Nakisa Lease Administration as per accounting standard and Chart of Depreciation.

For more information regarding the diagram above refer to explanations officially published by SAP: https://help.sap.com/doc/saphelp_erp2005/6.0/en-US/4f/71db80448011d189f00000e81ddfac/content.htm?no_cache=true

In case of an accounting approach, asset-related postings remain Depreciation area-specific based on the link established between Accounting Principal and Depreciation area in Nakisa Lease Administration. Depreciation area-specific postings are done into specified GL accounts based on the standard account assignment configuration in SAP Asset Accounting.

Liability postings are account-specific. Accounts are derived based on the account determination key created for the specific accounting principal, contract type, and classification type.

The following example describes account assignment for postings:

Scenario 4: Multi-GAAP management in one contract (ASC842 Finance & ASC842 Operating lease)

This is not a possible scenario as per ASC842.

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