How To Fix AO483 - Internal rate of return and payback period cannot be calculated

SAP Error Message - Details

• Message type: E = Error

• Message class: AO - Appropriation requests - Master data / Customizing

• Message number: 483

• Message text: Internal rate of return and payback period cannot be calculated

What causes this issue?

The system is supposed to calculate preinvestment analysis figures. It
is not possible to calculate the payback period and internal rate of
return based on the payment series.

System Response

The payback period and internal rate of return are not calculated.

How to fix this error?

Check the consistency of your payment series.

Procedure for System Administrators

The system issues an error message and will not allow you to continue with this transaction until the error is resolved.

Error message extract from SAP system. Copyright SAP SE.

Smart SAP Assistant

• What is the cause and solution for SAP error message AO483 - Internal rate of return and payback period cannot be calculated ?

  The SAP error message AO483, which states "Internal rate of return and payback period cannot be calculated," typically occurs in the context of investment management or asset accounting when the system is unable to compute the internal rate of return (IRR) or payback period for a given investment or project. This can happen for several reasons:
  Causes:
  
  
  Insufficient Cash Flow Data: The system requires a series of cash flows (inflows and outflows) over time to calculate IRR and payback period. If there are missing or incomplete cash flow entries, the calculation cannot be performed.
  
  
  Negative Cash Flows: If the cash flow series contains only negative values or if the cash flows do not change signs (e.g., all cash flows are negative), the IRR cannot be calculated.
  
  
  Incorrect Configuration: There may be issues with the configuration of the investment program or project, such as incorrect settings in the investment profile or missing parameters.
  
  
  Data Entry Errors: Errors in data entry, such as incorrect dates or amounts, can lead to issues in calculating the IRR and payback period.
  
  
  Time Frame Issues: If the cash flows are not aligned properly in terms of time periods (e.g., cash flows are not entered for all required periods), the calculations may fail.
  
  
  Solutions:
  
  
  Check Cash Flow Entries: Review the cash flow entries for the investment or project. Ensure that all necessary inflows and outflows are recorded and that they span the required time periods.
  
  
  Verify Cash Flow Signs: Ensure that there are both positive and negative cash flows in the series. The IRR calculation requires at least one positive and one negative cash flow.
  
  
  Review Configuration Settings: Check the investment profile and related configuration settings in SAP to ensure they are set up correctly for the type of investment or project you are working with.
  
  
  Correct Data Entry Errors: Go through the data entries for the investment or project to identify and correct any errors in amounts, dates, or other relevant fields.
  
  
  Consult Documentation: Refer to SAP documentation or help resources for specific guidelines on how to set up and manage cash flows for IRR and payback period calculations.
  
  
  Seek Technical Support: If the issue persists after checking the above points, consider reaching out to your SAP support team or consulting with an SAP expert for further assistance.
  
  
  Related Information:
  
  Transaction Codes: Familiarize yourself with relevant transaction codes in SAP that pertain to investment management, such as AO01 (Create Asset), AO02 (Change Asset), and AO03 (Display Asset).
  SAP Notes: Check SAP Notes for any known issues or patches related to this error message.
  Training and Documentation: Consider training sessions or documentation on investment management in SAP to better understand how to manage cash flows and perform calculations.
  
  By addressing the underlying causes and following the suggested solutions, you should be able to resolve the AO483 error and successfully calculate the internal rate of return and payback period for your investments.