What is depreciation key in SAP FI-AA - Asset Accounting?

SAP Term: depreciation key

• Component: FI-AA

• Component Name: Asset Accounting

• Description: A key for calculating depreciation amounts. The depreciation key controls the following for each asset and for each depreciation area: Automatic calculation of planned depreciation Automatic calculation of interest Maximum percentages for manual depreciation The depreciation key is defined by specifying: Calculation methods for ordinary and special depreciation, for interest and for the cutoff value Various control parameters

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• Key Concepts: 
  Depreciation key is a tool used in SAP Asset Accounting (FI-AA) to calculate the depreciation of an asset. It is used to define the depreciation calculation method, the rate of depreciation, and the period of depreciation. The depreciation key also determines the posting period for the depreciation postings. 
  
  How to use it: 
  In order to use a depreciation key, it must first be created in the system. This can be done by going to the “Depreciation Key” tab in the Asset Accounting component and selecting “Create”. Once created, the depreciation key can be assigned to an asset in the “Asset Master Data” tab. 
  
  Tips & Tricks: 
  When creating a depreciation key, it is important to consider the type of asset being depreciated and its expected useful life. This will help ensure that the correct rate of depreciation is applied and that the asset is depreciated over its expected useful life. 
  
  Related Information: 
  For more information on SAP Asset Accounting and how to use depreciation keys, please refer to SAP Help documentation or contact your local SAP support team.