Working with Small Investment Projects

Kevin asks Lisette whether she knows an even easier way to settle small investment objects to completed assets using assets under construction (AuC). Until now, Kevin only knows the periodic settlement to an AuC. These periodic settlements are summarized. This means that the individual invoices are summarized.

Lisette reports Kevin to another option: event-based settlement. During event-based settlement, there are no periodic settlements to an asset under construction. Instead, all costs of the investment project are posted completely directly to the asset under construction. Since the event-based settlement settles line items per line item to the asset under construction, the detailed postings are still visible on the asset under construction later. Event-based settlement is suitable for simple investment projects where there are usually few invoices.

Kevin wants to know more about event-based settlement. Lisette first explains the differences between periodic summary settlement and event-based settlement process.

If you use an Investment Profile with indicator Event Based Settlement to AuC set, the system reacts as follows:

1. The asset under construction is generated by assigning an investment profile to the project or work breakdown structure (WBS) element and upon releasing the project or WBS element.
2. When you post a supplier invoice to an investment project, an event-based settlement of the costs is automatically done together with the posting of the supplier invoice, the crediting of the costs (WBS Element), and the debiting of the assigned AuC.
3. Settlement rules are applied to all line items of the AuC to be settled. It is not possible to assign settlement rules on line-item level.

   As soon as the investment project has the statusTechnically Completed in the final settlement or if you start the settlement with the processing type Partial Capitalization or Full Settlement, the costs are transferred from the AuC to the settlement receiver, for example, to the final assets.

   When reporting the costs on the AuC or the final asset, the posting information of the original supplier invoice is available via the predecessor reference fields.

• Event-based settlement posts costs directly to AuC.
• Event-based settlement suitable for simple projects with few invoices.
• Settlement rules applied to all line items of AuC.
• Costs transferred from AuC to final assets upon project completion.