Component: FS-BA-PM-AFP
Component Name: Accounting for Financial Products
Description: A book value component that is created when a valuation approach changes for example, for a reclassification or the dissolution of a hedging relationship, and when a new financial year is opened by freezing the valuations of the previous year floating average principle. Valuation remnants can be distributed as a reaction to a position outflow 'floating average' or over the term of the underlying contract.
Key Concepts: Valuation remnants are the residual amounts that remain after a valuation process has been completed. This process is used to determine the value of a financial product, such as a loan or security. The valuation remnants are the difference between the current market value of the product and the amount that was originally invested in it.
How to use it: Valuation remnants are used in the Accounting for Financial Products (AFP) component of SAP’s Financial Services Business Application (FS-BA-PM). This component allows users to track and manage their investments in financial products, including loans and securities. The valuation remnants are used to determine the current market value of a product and can be used to inform decisions about whether to buy or sell a particular product.
Tips & Tricks: When using the AFP component, it is important to remember that valuation remnants can change over time. As such, it is important to regularly check the current market value of a product and adjust your investments accordingly. Additionally, it is important to remember that valuation remnants are only one factor in determining the value of a product; other factors such as interest rates and market conditions should also be taken into account.
Related Information: For more information on how to use the AFP component of SAP’s Financial Services Business Application, please refer to SAP’s