Question: Why and How we Revalue the Fixed Assets in SAP?

Answer

Purpose of Revaluation
A revaluation of fixed assets is a technique that may be required to accurately describe the true value of the capital goods a business owns. The purpose of a revaluation is to bring into the books the fair market value of fixed assets. This may be helpful in order to decide whether to invest in another business. If a company wants to sell one of its assets, it is revalued in preparation for sales negotiations.

Procedure for Revalue the Fixed Assets:
1. Go to OABW and check both revalue APC and depreciation in the depreciation area where you want to post. This would help in identifying the area where the revaluation will have to be posted.
2. Go to OAYR and select the company code. Then click on the posting rules.
In the book depreciation area, go to other posting settings. Check post revaluation. This setting is required for posting the revaluation amount.
3. Go to AO90 and Create a revaluation APC as well as clearing account. The revaluation APC has to be a recon account and the revaluation clearing a P&L. Similarly create for depreciation as accumulated and a normal P & L.
4. Now go to ABAW, and select the asset to be revalued. Put the transaction type as 800. Press enter.
In the next screen give an asset value date, amount to be posted as revaluation. Now click save. An asset accounting document will be generated.

Note:
This revaluation amount will not be posted automatically. Once depreciation run takes place then only the amount gets posted to the GL account. Hence it is advisable to run at the year end.
Also the depreciation run has to be for the first time in order to get the revalued amount to be posted. Otherwise, the amount will not be posted in the GL account.
Run the Depreciation for a period in AFAB. If you do a test run you would be able to see the revaluation amount that has to be posted and the same would be reflected in the planned values in asset explorer (AW01N).
Same won’t be reflected in the posted values unless the depreciation run was not a test run.
Once the depreciation run is done, revaluation account APC will be debited and the revaluation clearing account will be credited.
This revaluation account will then be transferred to P & L account by passing a manual entry.