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Provision for reserve posting for Asset

Posted on by Microsoft Employee

Hi All,

I am trying to understand provision for reserve posting for an asset, I tried exploring from my end but didn't get any clue on how to provision for reserve will be posted?

Can anyone please suggest how these transactions are posted ?

Regards,

Nakul

  • RE: Provision for reserve posting for Asset

    Hi Ludwig,

    We are currently looking into this functionality for a company in The Netherlands where we have a similar rule as what you described for Germany. Which I believe can be summarized as follows:

    1. Sale of Fixed Asset:  transfer all gains to the reserve account

    2. Fixed Asset Acquisition: ability to reduce the FA acquistion value from the reserve account

    3. Transfer reserve to profit & loss: When no reinvestment is done within the specific time frame   

    However, I'm struggling to understand which setup needs to be done where to make this work.

    Can you explain in more detail the setup behind this functionality or share an example? 

    Thank you.

    Kind Regards

    Femke

  • Community Member Profile Picture
    Community Member Microsoft Employee on at
    RE: Provision for reserve posting for Asset

    Hi Sourav and Ludwig, thanks for your responses. I have gone through your responses and will try doing it in system. If required I will open another thread.

  • Ludwig Reinhard Profile Picture
    Ludwig Reinhard Microsoft Employee on at
    RE: Provision for reserve posting for Asset

    Good morning Nakul,

    Have you seen the feedback and got an idea for what to use this functionality for?

    Please let us know if this answers your question by verifying the answer.

    Best regards,

    Ludwig

  • Suggested answer
    SouravDam Profile Picture
    SouravDam 11,721 on at
    RE: Provision for reserve posting for Asset

    Hello nakul_waghe,

    Is this sorted out or you need any further clarification from the Forum?

    Kindly update.

    Best regards,
    Sourav Dam

    Kindly mark this thread 'Yes' if this is answered your query which may help other community members in this forum.

  • Verified answer
    Ludwig Reinhard Profile Picture
    Ludwig Reinhard Microsoft Employee on at
    RE: Provision for reserve posting for Asset

    Hi Nakul,

    I have not seen many companies using this functionality.

    It is a special functionality that you can use for example in my home country Germany when you sell a fixed asset and try to reinvest the money into a new fixed asset.

    So, let's say you want to sell an old machine and invest in a newer / better one.

    To make those reinvestments more attractive for companies the government allows to treat the profit that you make for the sale special. Special means that you don't have to pay tax on it provided that you reinvest it within a specific time into the purchase of a new fixed asset.

    You can use this functionality to post the profit from the sale to a reserve account that can be cleared when you purchase a new fixed asset. The overall effect is a tax saving.

    I cannot tell you whether you have a similar rule in your country/region.

    If you have, test out this feature.

    Otherwise, don't use it.

    Best regards,

    Ludwig

  • Verified answer
    SouravDam Profile Picture
    SouravDam 11,721 on at
    RE: Provision for reserve posting for Asset

    Hello nakul_waghe,

    Have you gone through below link shared by Microsoft?

    https://docs.microsoft.com/en-us/dynamicsax-2012/appuser-itpro/about-fixed-asset-reserves

    Kindly check and update the Forum.

    Best regards,
    Sourav Dam

    Kindly mark this thread 'Yes' if this is answered your query which may help other community members in this forum.

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