Dynamics Community Forum Thread Details

Hi Microsoft Community,

I am facing an issue/behaviour in Dynamics 365 Finance & Operations – Fixed Assets and would like to understand whether this is standard system behaviour or if there is any configuration to achieve the expected result.

Scenario

I have a fixed asset:

Asset: OE0001
Service life: 5 years (60 months)
Depreciation profile: Straight line – Life remaining

The following transactions are posted:

Date	Asset	Transaction	Amount
01-Aug-2026	OE0001	Acquisition	₹10,00,000
31-Oct-2026	OE0001	Revaluation	₹30,00,000
31-Dec-2026	OE0001	Acquisition	₹20,00,000

The business requirement is that the ₹20,00,000 acquisition posted on 31-Dec-2026 should start depreciating from 31-Dec-2026, as this amount was added to the asset only on 31-Dec-2026.

However, when I run the Depreciation proposal, D365 calculates depreciation for the additional ₹20,00,000 from the original asset depreciation start date of 01-Aug-2026.

Tests already performed

I have tried the following:

Used Acquisition instead of Acquisition adjustment for the ₹20,00,000 addition.
Changed the Depreciation Convention and tested with Full Month.
Changed the depreciation profile from Straight line – Life remaining to Straight line – Service life.

However, the result remains the same. The additional ₹20,00,000 is still being considered from the original depreciation start date of 01-Aug-2026.

Expected behaviour

I would expect D365 to treat the transactions as follows:

01-Aug-2026 – Acquisition ₹10,00,000: Depreciation starts from 01-Aug-2026.
31-Oct-2026 – Revaluation ₹30,00,000: Recalculate depreciation based on the revalued asset value.
31-Dec-2026 – Additional Acquisition ₹20,00,000: Depreciation for this additional amount should start from 31-Dec-2026.

In other words, the additional acquisition should have its own depreciation start date based on the acquisition transaction date, rather than using the original asset's depreciation start date.

Questions

Is this the standard behaviour in D365 Finance & Operations when a subsequent acquisition is posted against an existing fixed asset?
Is there any depreciation convention, book setup, depreciation profile, or other standard configuration that allows a subsequent acquisition on the same fixed asset to start depreciation from its own transaction date?
If this is not supported for the same fixed asset, what is the recommended standard D365 approach for handling capital additions to an existing asset where the addition needs to have a different depreciation start date?
Would creating the additional amount as a separate fixed asset be the recommended approach, or is there another standard functionality that supports this requirement?