In SAP FI Asset Accounting, what is correct about line item settlement for an asset under construction (AUC)?

Introduction / Context:
Assets under construction (AUC) often collect many individual postings over the life of a project, such as vendor invoices, internal allocations, and down payments. SAP FI Asset Accounting provides line item settlement so that you can control which specific postings are settled to which final assets. For certification, it is important to understand that the system requires a full settlement of each line item even if you do not settle all items at the same time.

Given Data / Assumptions:

• The asset is an asset under construction using line item settlement in SAP FI AA.
• Each posting to the AUC appears as a separate line item in the settlement process.
• Settlement rules can be defined to transfer line item values to one or more receiver assets or cost objects.
• We need to clarify whether all items must be settled at once and whether each item must be fully distributed.

Concept / Approach:
Line item settlement allows you to select which individual postings will be settled and to which receivers they will go. You can choose to settle only some items at a given time, for example when some parts of a project are complete while others are ongoing. However, SAP requires that the full amount of each selected line item be distributed to receivers. You may not leave a residual amount of a settled line item unassigned. Over the life of the AUC, all line items that represent capitalizable costs should eventually be fully settled.

Step-by-Step Solution:
Step 1: Recall that line item settlement works at the level of individual postings, not only at the total AUC balance level. Step 2: Understand that you can select some line items and leave others for later settlement, depending on project completion stages. Step 3: Recognize that when you choose to settle a particular line item, SAP expects one hundred percent of its value to be allocated across receivers. Step 4: Review the answer choices and find the one that states both that not all items must be settled at once and that each settled line item must be fully distributed. Step 5: Identify option a as the only statement that correctly combines these two conditions.

Verification / Alternative check:
Consider a project where certain components are finished and ready for capitalization, while other components are still in progress. You may choose to settle the completed part by selecting its corresponding line items and assigning them to the final fixed asset. SAP allows this partial settlement at the project level but demands that each of the selected line items be fully allocated to receivers. If any portion remains undistributed, the settlement run will show errors. This behavior confirms the principle described in option a.

Why Other Options Are Wrong:
Option b incorrectly states that you must always settle all line items at once and that you do not have to distribute one hundred percent of each line item. Option c is false because line item settlement is specifically supported and useful for assets under construction. Option d suggests that residual amounts on line items can be ignored, which contradicts SAP controls that require full distribution. Option e is wrong because line item settlement has a direct impact on the values transferred from AUC to receiver assets and therefore on financial reporting.

Common Pitfalls:
Users sometimes think that as long as the total AUC is roughly settled, the exact distribution of each line item does not matter, which can lead to inconsistencies and reconciliation issues. Another pitfall is to assume that settlement is an all or nothing process, forcing all items to be settled simultaneously. Remember that SAP provides flexibility in which items are settled when, but insists on complete distribution for each line item that is part of a settlement run.

Final Answer:
For line item settlement of an AUC, you do not have to settle all line items at once, but one hundred percent of each individual line item must ultimately be distributed in line item settlement.