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Dynamics 365 Community / Forums / Microsoft Dynamics AX (Archived) / Fixed Asset Revaluation
Microsoft Dynamics AX (Archived)

Fixed Asset Revaluation

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Posted on by MuhammadFaisal 329

Hello Experts,

I am trying to do the fixed asset revaluation as per the IAS 16 guidelines but unable to perform the transaction. Following are the scenarios which i am trying to perform in the AX.

Building cost 100,000

Estimated life 10 Yrs

Accumulated Depreciation 30,000

Net Book value 70,000

Case 1: Market Fair Value 150,000

so, the accounting entries which will be recorded for case 1 will be as follows

DR  Building 50,000

DR Accumulated depreciation 30,000

CR Revaluation surplus 80,000

Case 2: Fair Market value 50,000

Accounting entries which will be recorded

CR Building 50,000

DR Accumulated Depreciation 30,000

DR Revaluation Loss 20,000

I have tried to do the revaluation through the Asset journal but it made impact on the Asset and surplus/loss account only.

Can you guys help to achieve the required results or guide me how you guys are recording revaluation of the Fixed Assets.

Thank you

Faisal

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  • MuhammadFaisal Profile Picture
    MuhammadFaisal 329 on at
    RE: Fixed Asset Revaluation

    Hi Ludwig,

    Thank you for all your support and guidance about fixed asset revaluation and the experience/idea website. I have created the idea named by Automating the process of revaluation under the category User Experience.

    Hope the idea will be considered.

    Thank you

    Faisal

  • Verified answer
    MuhammadFaisal Profile Picture
    MuhammadFaisal 329 on at
    RE: Fixed Asset Revaluation

    Hi Ludwig

    For the second case i have split the accounting entry as per the suggestion and perform the transaction in the AX as follows.

    i entered two Fixed asset journal for this.

    In first journal  i selected the posting profile revaluation and entered the 20,000 amount in the credit column with offset to the Revaluation Loss account. This Journal created the accounting entry as required and impact of it on asset fact box was correct.

    In the second journal i tried to reverse the impact of depreciation with crediting the building account. To do this i created two lines journal. In first line i selected the posting type depreciation and entered the 30,000 amount in the debit column ad kept offset account empty. In the second line of journal i used posting type acquisition and entered the amount 30,000 in credit column and posted the journal. Accounting impact of this transaction was correct as well impact on asset fact box was accurate.

    Using the above method i am able to achieve the required result of case 2.

    Thank you,

    Faisal

  • Suggested answer
    Ludwig Reinhard Profile Picture
    Ludwig Reinhard Microsoft Employee on at
    RE: Fixed Asset Revaluation

    Hello Faisal,

    I believe that this posting can be realized in a fixed asset journal in the FA module. Yet, it is probably not what you and other users expect as a manual interaction is required. To get this resolved in the future, it would be great if you could post a note on the following experience/ideas website: experience.dynamics.com/ideas

    Many thanks for your help and best regards,

    Ludwig

  • Verified answer
    MuhammadFaisal Profile Picture
    MuhammadFaisal 329 on at
    RE: Fixed Asset Revaluation

    Hi Ludwig,

    Thank you for the response, I have already tried this by splitting the transaction of case one to achieve the results.

    Split entry

    First Journal entry

    DR Building 50,000

    CR Revaluation surplus 50,000

    Second Journal entry

    DR Accumulated Depreciation 30,000

    CR Revaluation Surplus 30,000

    I tried this in two ways:

    First Way entered through the Manual Journal from the general ledger module

    But issue with this is that the manual journal from the general ledger module will not update the module level balance.

    As i can only select the asset account in the manual Journal it will be updated but what to do with the depreciation balance on module level? Depreciation case can become complicated if the asset is revalued second time.

    In second way tried it through the Fixed asset Journal. To do this i created two journals one with posting type Revaluation for the amount of 50,000 and the impact was correct also accounting entry was correct and for the adjustment of the Accumulated depreciation i entered second journal with posting type depreciation by entering the amount of 30,000 in the debit column. With this accounting entry was correct as well as the balances in the fact box of the asset was correct by showing the depreciation amount zero and adding the 30,000 impact in the value of the asset.

    By the Second way my case 1 is resolved. Now testing on the Case 2.

    Thank You

    Faisal

  • Verified answer
    Ludwig Reinhard Profile Picture
    Ludwig Reinhard Microsoft Employee on at
    RE: Fixed Asset Revaluation

    Hello Faisal,

    The 'split' posting voucher that you listed above - take for example the second one

    CR Building 50,000

    DR Accumulated Depreciation 30,000

    DR Revaluation Loss 20,000

    is not supported in this way if you make use of the revaluation posting type.

    That is because a revaluation transaction posts the fixed asset against a revaluation profit/loss account.

    If you need this posting you can create a manual journal and then create two single journal lines

    Line 1

    CR Building 30,000

    DR Accumulated Depreciation 30,000

    Line 2

    CR Building 20,000

    DR Revaluation Loss 20,000

    Note: I assume that you have to manually overwrite the offset account used for making this posting as it will automatically default to the profit/loss account that is setup in your fixed asset posting profile. There you can only setup one single account and thus have to overwrite it to get the posting you want.

    Best regards,

    Ludwig

  • MuhammadFaisal Profile Picture
    MuhammadFaisal 329 on at
    RE: Fixed Asset Revaluation

    Hello André Arnaud de Calavon

    Thank you for the response. IAS 16 provide guidelines that we should reverse the accumulated depreciation on the time of revaluation.

    When the depreciation entry is recorded in the books of account following entry is made

    DR Depreciation expense account

    CR Accumulated depreciation account

    So At the time of revaluation, accumulated depreciation account will be Debited to reverse the impact. and yes it will be the already depreciated amount.

    Here is the reference document link for the IAS 16

    http://www.accaglobal.com/pk/en/student/exam-support-resources/fundamentals-exams-study-resources/f7/technical-articles/ppe.html

    Faisal

  • André Arnaud de Calavon Profile Picture
    André Arnaud de Cal... 297,421 Super User 2025 Season 2 on at
    RE: Fixed Asset Revaluation

    Just reading a bit better now... Why do you think you need to debit the Accumulated Depreciation here? It is the same amount as the already depreciated amount.

  • MuhammadFaisal Profile Picture
    MuhammadFaisal 329 on at
    RE: Fixed Asset Revaluation

    Hello André Arnaud de Calavon,

    Thank you for the response. I used Posting type revaluation.

    Faisal

  • André Arnaud de Calavon Profile Picture
    André Arnaud de Cal... 297,421 Super User 2025 Season 2 on at
    RE: Fixed Asset Revaluation

    Hi Muhammad,

    What asset posting type did you select in the journal? Revaluation or depreciation adjustment?

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