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VC_ARO_INF - Enter Inflation Rates

VC_ARO_INF - Enter Inflation Rates

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Inflation rates are used to calculate the settlement value of an ARO. To enable valuation of an ARO according to different accounting principles, you can define inflation rate keys specific to accounting principles.

In this Customizing activity, you can enter inflation rate keys to represent specific sets of inflation rates used in the valuation of financial obligations such as asset retirement obligations (AROs).

The maintenance of inflation rates is very flexible. You must define the inflation rates by entering the rates for different Valid Onand Valid Fromdates. Using the Valid Fromdate, you can also define estimated future inflation rates (Valid Fromis later than Valid On) that are then also for the future valid-from dates, for example, in the calculation of future settlement values.

Note that the access to the inflation rates depends upon a key date. If there are no inflation rates with a Valid Ondate that matches the given key date, the system uses the inflation rates defined for the latest Valid Ondate that is less than the given key date.

Note also that if you do not enter historical inflation rates (Valid Fromis earlier than Valid On) when you enter inflation rates for a new Valid On date, the system uses an inflation rate of 0% for the periods for which it is not able to find an inflation rate. Under certain circumstances, the system might show an error message instead of using 0% as the inflation rate.

When you create an ARO, you can enter one of the predefined inflation rate keys per accounting principle.

You can set default inflation rate keys per ARO in Customizing for SAP S/4HANA for asset retirement obligation under Basic Settings> Define Obligation Types and Obligation Type Configuration.

You can also maintain inflation rate keys from the SAP Easy Access menu for SAP S/4HANA for asset retirement obligation.

1. Enter a three-character inflation rate key and a description.

2. Select your inflation rate key and then select Inflation Rates.

3. Select New Entriesand enter the following:

  • The dates on which inflation rates are valid
Valid On is used to track the history of the inflation rate curves.
  • The dates from which inflation rates are valid
You define a start date of the period for which the specified inflation rate is valid.
  • Percentage inflation rates

4. Save your inflation rate key.






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