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Asset Depreciation

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This function is used to create or amend depreciation models that are to be utilised or a being utilised by the company, and linked to assets.  The depreciation model governs how assets will be depreciated. Wear and tear models for tax may also be added.

 

The available Depreciation Methods are straight line, reducing balance and scheduled depreciation.

 

Depreciation may be processed between applicable financial periods or between specific dates on which acquisition and disposal take place.

 

The depreciation account code must be an income statement account code, which may be linked to a division or a cost centre, and the accumulated depreciation account code a balance sheet account code, which will usually be linked to a division.

 

hmtoggle_plus1Add

The Add button is enabled when a Depreciation Model Code is captured.

 

When the Add button is selected, the new Depreciation Model Code, Description, straight line months, depreciation percentage, Depreciation Account Codes, and Accumulated Depreciation Account Codes are inserted into the Asset Depreciation Model.

 

The user must have a security profile linked to the function Asset Depreciation Model with access allowed to Add.

 

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The asset Depreciation Model Code must be greater than zero.
The asset depreciation model Description cannot be less than 3 characters or more than 100 characters in length.
The Depreciation Account Codes and Accumulated Depreciation Account Codes must exist and must be active.

 

hmtoggle_plus1Depreciation Account Code

This is the account code which, together with the cost centre or division on the depreciation record on Asset Information, is used to link the account to be debited when the asset is depreciated.

 

The Account Code must allow the application allow Asset Depreciation.

 

When doing an inquiry on an existing depreciation model code, this field displays the Depreciation Account Codes of the selected Depreciation Model Code from the Asset Depreciation Model.

 

When adding a new Depreciation Model Code, the user must select a valid depreciation account code. It is populated with the code and description from the Account Codes where the account code class is "Income".

 

hmtoggle_plus1Accumulated Depreciation Account Code

This is the account code which, together with the division on the depreciation record on Asset Information, is used to link the account to be credited when the asset is depreciated.

 

The Account Code must allow the application allow Asset Accumulative Depreciation.

 

When doing an inquiry on an existing depreciation model code, this field displays the Accumulated Depreciation Account Codes of the selected Depreciation Model Code from the Asset Depreciation Model.

 

When adding a new Depreciation Model Code, the user must select a valid accumulated depreciation account code. It is populated with the code and the description from the Account Codes where the account code class is "Balance Sheet".

 

hmtoggle_plus1Depreciation Methods

This frame is used to specify the depreciation method which will apply to the selected depreciation model. The options are straight line depreciation, reducing balance depreciation and scheduled depreciation.

 

The straight line method requires either the total number of months over which the asset is to be depreciated or depreciation percentage per year to be captured. If the total months is captured, the percentage per year will automatically be calculated and vice versa.

 

The reducing balance method requires the percentage per month at which the asset is to be depreciated to be captured. This method depreciates the asset using a specified percentage. If an initial depreciation allowance is specified for the asset (non-tax purposes), this value will first be subtracted from the take-on value of the asset before the depreciation is calculated.

 

The scheduled depreciation requires the total number of months over which the asset is to be depreciated to be captured. Refer Scheduled Depreciation.

 

hmtoggle_plus1Change

The Change button is enabled when an existing Depreciation Model Code is selected.

 

When the Change button is selected, the Description, straight line months, depreciation percentage, Depreciation Account Codes, and Accumulated Depreciation Account Codes  on the Asset Depreciation Model, are updated with the changed values.

 

The user must have a security profile linked to the function Asset Depreciation Model with access allowed to Change.

 

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The asset Depreciation Model Code must be greater than zero.
The asset depreciation model Description cannot be less than 3 characters or more than 100 characters in length.
The Depreciation Account Codes and Accumulated Depreciation Account Codes must exist and must be active.
For all Depreciation Methods, the total months or percentages per year/month have to be greater than zero.

 

hmtoggle_plus1Delete

The user must have a security profile linked to the function Asset Depreciation Model with access allowed to Delete.

 

The Delete button is enabled when an existing Depreciation Model Code is selected.

 

When the Delete button is selected, the specified asset depreciation model record is deleted from the Asset Depreciation Model.

 

The delete cannot be performed if there are assets that are linked to the asset depreciation model.

 

hmtoggle_plus1Depreciation Model Code

The asset depreciation model, when linked to an asset on the Asset Information function, determines how the asset will be depreciated. Depreciation models for tax and non-tax purposes may be added.

 

hmtoggle_plus1Description

This field displays a description of the Depreciation Model Code.

 

When doing an inquiry on an existing Depreciation Model Code, this field will display the description of the selected Depreciation Model Code from the Asset Depreciation Model.

 

When adding a new Depreciation Model Code, the user must enter a description of the code in this field. It is an alphanumeric field with a maximum length of 100 characters (mandatory).