What is low-value asset in SAP FI-AA - Asset Accounting?

SAP Term: low-value asset

• Component: FI-AA

• Component Name: Asset Accounting

• Description: An asset for which the acquisition and production costs, less any included sales tax, does not exceed a legally pre defined amount. Typically, low-value assets can be completely written off within the period in which they are acquired.

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• Key Concepts: 
  Low-value asset is a term used in SAP Asset Accounting (FI-AA) to refer to assets with a low acquisition cost. These assets are typically used for short-term purposes and have a limited useful life. Examples of low-value assets include office supplies, furniture, and small tools.
  
  How to use it: 
  In SAP Asset Accounting, low-value assets are treated differently than other assets. They are not capitalized and do not appear on the balance sheet. Instead, they are expensed as soon as they are acquired. This allows companies to more accurately track their expenses and ensure that they are not overspending on low-value items.
  
  Tips & Tricks: 
  When setting up low-value asset accounts in SAP Asset Accounting, it is important to ensure that the correct depreciation method is selected. This will ensure that the asset is expensed correctly and that the company is not overspending on these items.
  
  Related Information: 
  For more information on low-value asset accounting in SAP Asset Accounting, please refer to the official SAP documentation.