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Dynamics 365 Community / Forums / Microsoft Dynamics GP (Archived) / FA Declining Balance d...
Microsoft Dynamics GP (Archived)

FA Declining Balance does not recalculate monthly

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Posted on by Community Member

I am implementing Fixed Assets using the declining balance method but the results are not as expected. The calculation takes NBV from the last year end instead of the last month end. This results in 12 months with the same figure spread evenly throughout the year. The expected result would be a different figure (slightly lower) each month. I tried the Amortization method but same result.

Can anyone make some suggestions.

Thank You,

RL

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  • Frank Hamelly | MVP, MCP, CSA Profile Picture
    Frank Hamelly | MVP... 46,627 Moderator on at

    What are your depreciation settings i.e. - method, averaging convention, switchover, etc.?

  • Community Member Profile Picture
    Community Member on at

    Hi Frank,

     The settings are as follows:

    Method - Declining balance

    Averaging Convention - Full period

    No switch

    Book depreciation period - Periodic

     

     

  • Frank Hamelly | MVP, MCP, CSA Profile Picture
    Frank Hamelly | MVP... 46,627 Moderator on at

    The culprit is your Periodic book period.  From the Help files -

    Depreciation Period

    Select the depreciation period. A yearly depreciation rate is calculated for each asset at the beginning of each year.

    • Daily depreciation results in the yearly rate being allocated based on the number of days in a period. For companies using accounting periods of 4-week, 4-week, 5-week quarters, daily should be used. Periods that are longer will receive more depreciation.
    • Periodic depreciation results in the yearly rate being allocated equally for each period in the year.
  • Community Member Profile Picture
    Community Member on at

    Thanks...... but still not quite the results I was looking for. With this method depreciation is still calculated on a yearly basis instead of monthly/period. It just that the spread of this yearly figure is now daily instead of the same figure monthly. So January, March, May etc willl have the same figures whereas the othe months with 28 or 30 days have a different figure.

    Basically I would not like GP to create depreciation on a yearly basis and spread over the 12 months. It should re-calculate depreciation each month based on last month's NBV.

    Below is a table of the expected results that I am not getting in GP:

    Asset cost $10,000   Acquisition date 3/1/2008
    Percentage 10%   Method Declining
             
    Date Depreciation NBV    
    Mar-08 $83.33 $9,916.67    
    Apr-08 $82.64 $9,834.03    
    May-08 $81.95 $9,752.08    
    Jun-08 $81.27 $9,670.81    
    Jul-08 $80.59 $9,590.22    
    Aug-08 $79.92 $9,510.30    
    Sep-08 $79.25 $9,431.05    
    Oct-08 $78.59 $9,352.46    
    Nov-08 $77.94 $9,274.52    
    Dec-08 $77.29 $9,197.23    
    Jan-09 $76.64 $9,120.59    
    Feb-09 $76.00 $9,044.58    
    Mar-09 $75.37 $8,969.21    

  • Frank Hamelly | MVP, MCP, CSA Profile Picture
    Frank Hamelly | MVP... 46,627 Moderator on at

    Understood RL but that's not the way GP does it.  What is the $$ difference on an annual basis between your method and the GP method?

  • Community Member Profile Picture
    Community Member on at

    The figures are close, just about $30 difference in yr 1. I will just have to explain to the client that GP will only calculate on a yearly basis.

    Thanks,

    RL 

     

  • Frank Hamelly | MVP, MCP, CSA Profile Picture
    Frank Hamelly | MVP... 46,627 Moderator on at

    Yes, unfortunately GP does a lot of things really well but there is just a bit of weakness in depreciation.  If you ever need to explain how GP simulates MACRS on the tax side, I have a blog post up on that topic here - http://gp2themax.blogspot.com/2009/10/gptip42day-macrs-depreciation-in-gp.html.

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