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Dynamics 365 Community / Forums / Finance | Project Operations, Human Resources, ... / Projects Estimation an...
Finance | Project Operations, Human Resources, ...
Suggested Answer

Projects Estimation and Elimination Entries

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Posted on by ASidd 205

The Projects Estimation and Elimination Process to place an asset in service (create an asset on the Balance Sheet) has stopped working the way it was set up to work.  This process should create the Journal entry to place the Project on the Balance Sheet.  This process does put the Project into the Fixed Asset Module, creating a placed in service date and an acquisition date, and an amount.  However, I do not see that Fixed Asset amount anywhere in the general ledger.  In Feb. This process debited my asset account, and credit my expense account.  In May, it did not. I have attached a document walking through this.

Below is the attached file for steps.

Project-fixed-asset-problem.docx

Projects-additional-information.docx

I have the same question (0)
  • Ludwig Reinhard Profile Picture
    Ludwig Reinhard Microsoft Employee on at

    Hi,

    Can you share the transaction origin of your elimination voucher?

    Also, can you share what has been selected in the general tab of the estimate form?

    Can you also elaborate on the December and February eliminations?

    Do you want to partially move the project costs to your fixed assets or what is it that you try doing exactly?

    Many thanks,

    Ludwig

  • ASidd Profile Picture
    ASidd 205 on at

    I have uploaded an additional Word doc to my original post, that shows the June entries that happen when I estimate/eliminate, as well as the February entries when it was working as planned, along with the General tabs associated with those.

    I do see a difference in the General tab settings. Maybe that's the problem? I am not sure how to change that.

    So, what's happening is that I have a project, and we are still adding costs to it each month. All the expenses in this project are supposed to be capitalized to 50-13020 which is a prepaid account. So, each month, for month-end reporting, I am estimating and eliminating the Project, to take it out of WIP, and create the asset so it looks right on our Financial statements. Then, the next month, I reverse the estimate and elimination entries and Run a new estimation and elimination. Hopefully that explains what I am trying to accomplish.

  • Suggested answer
    Ludwig Reinhard Profile Picture
    Ludwig Reinhard Microsoft Employee on at

    Hi ASidd,

    A monthly elimination does not seem to make sense to me.

    Why is that done?

    I can understand that you want to move the costs to a fixed asset but what difference does such a monthly elimination make?

    Of course you can post a depreciation of the fixed asset and reduce your profit but is such a partial asset transfer is most often not allowed by most of the international accounting regulators unless the part that you transfer to the fixed asset can really be separated and can be seen as a closed partial project.

    In case you really want to do a monthly elimination and transfer to a fixed asset you can either work with subprojects for each month or reverse the previous estimates and eliminations and run them again.

    The latter process creates, however, a lot of in and out postings that are difficult to track and audit.

    Would recommend that you discuss the process with your colleagues internally again and whether this is really what you need from a finance & accounting perspective.

    Best regards,

    Ludwig

  • ASidd Profile Picture
    ASidd 205 on at

    The asset is already in service. It’s for our custom product that we are trying to create an asset for, so it’s not supposed to be in WIP. But we keep adding capitalizable costs to it, so we don’t have a final number for this project.

    What I’m asking you to do is help us fix how it was set up, because it was working as planned in February, but not now.

    The system was supposed to be making the entry to capitalize for us, when I estimate and eliminate, but it’s not properly make the Journal entries necessary anymore. It needs to hit the balance sheet asset account, and it is no longer doing that.

    Any Suggestions on how this can be done?

  • Ludwig Reinhard Profile Picture
    Ludwig Reinhard Microsoft Employee on at

    Hi ASidd,

    If it worked fine earlier this year then there must have been a change in your system.

    Do you know if some updates or code modifications have been put in place in March, April or May?

    Best regards,

    Ludwig

  • IK_365 Profile Picture
    IK_365 5 on at

    Hi,

    I just need to know one thing, How did you configure the fixed asset credit account, which is also showing in Posting profile coloumn

    Regards

    Imran Khan

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