SPAU and SPDD

When you apply a package, a large number of objects are changed.

If you have applied any OSS notes to objects in your system, the hot package may overwrite these objects.

SPDD is used to identify dictionary objects

and

SPAU (repository objects), will identify any objects where the hot package is overwriting changes you have made through OSS notes.

You must check all objects identified in SPAU and decide whether you need to reapply the OSS note or reset the code to the original SAP Code.

If, for instance, you are applying hot package 34, SPAU identifies an object where you have applied an OSS note. You must check the OSSs note and see if SAP have fixed that note in a hot package.

If the OSS note has been fixed in hot package 34, then you should reset the object to its original source code. This means that there is no repair flag set against this object again and it is now SAP standard code.

If, however, the object is not fixed until hot package 38, or there is no fix available you have to reapply the OSS note, otherwise users will encounter the problems they had before the note was applied.

You must transport all reapplied notes and Reset to SAP Standard objects after you apply your hot package to your QAS and PRD systems.


What objects will come in SPAU and SPDD?
All the objects which are modified, after tansporting to the current system, will be listed in SPAU and SPDD. SPDD contains the list of all modified Data Dictionary objects, like tables, dataelements, domains,view...etc. The rest of all the modified repository objects will be listed in SPAU. 
What happens to the modifications done in the older version when we upgrade the version? (with Modification assistant and w/o)
After the initial upgrade happens, we have to do adjustments from SPAU/SPDD to maintain or reset the changes. That is, from the list of objects in SPAU/SPDD, you have to either carry forward the changes to the new version, by choosing the option ADOPT CHANGES (available on right click) or RESET TO ORIGINAL (available on right click).
Will they come in these transactions?
Yes, they will be listed in these transactions, after the BASIS updgrade activity. 
And what if we apply some patches(Notes) to the system? What is the impact of these patches to the SPAU transaction?
Patches will be supported by the version upgrade. In case of notes, we have to verify whether these notes are supported by the new version (you can go into http://www.service.sap.com/notes to verify this. Also, we have to analyze whther the code in the note is already incorporated in the new version. In this case you can ignore the chanes choosing RESET TO ORIGINAL option