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I am having difficulty establishing the number of periods remaining for fixed assets being imported to a new FA module.
How important is this field, is it used in any calculations (doesn't seem to be)? Would it be a problem if I enter a number too high or too low? We are using Straight line dep'n.
The potential issues as I see them are:
Does anyone know if either of these scenarios are a problem?
thanks
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Hi Ludwig,
yes I thought I was happy with the method of 'dep'n but think I will do some more testing, although I discovered that you can still change the number of periods remaining even after running some depreciation, so less concerned on this now.
many thanks
AXF
Hello AXfinance,
The major difference between the "straight line" and "straight line remaining" method for fixed assets transferred from previous systems occurs in cases where "special" depreciations have been recorded in your previous system (e.g. an extraordinary depreciations because of some country-specific regulations). If you are using the "straight line remaining" method the remaining net book value will be divided and spread over the remaining periods. Using the "straight line" method does not guarantee that and can result in wrong depreciation amounts. Probably test some different scenarios in a demo system to identify the difference.
Hope this helps,
Ludwig
Hi Ludwig,
I am currently using 'straight line service life' which seems to be just spreading the cost over the full life equally. eg it appears to be the original cost divided by the whole life number of periods.
This looks ok to me as I have also posted the depreciation brought forward figures by journal, and also entered the no. of periods remaining (give or take one or two).
If I use the 'straight line life remaining, won't it increase the amount being charged as it is spread over a shorter period?
regards
AXF
Hi AXfinance,
The field is important and influences your depreciation calculated. If you use straight line depreciation you have to make sure that the method "straight life remaining" is selected. Otherwise the calculated depreciation of transferred fixed assets might be calculated wrong.
Hope this helps,
Ludwig
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