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Please explain the meaning and purpose of Value Model in Fixed Assets with relevant practical examples.
Thanks
Kumar
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Like stock items, Fixed Assets are both a physical entity and a financial entity; but Fixed Assetscan be accounted for in several different ways within the same legal entity. The main variable is the rate of depreciation to apply. An example is that the current depreciated valuation of a piece of equipment may be different for Tax purposes, for Insurance purposes, and for Balance Sheet reporting. Some countries have very complex Fixed Asset reporting requirements that require that different depreciation and current values are maintained for a single asset.. To cope with this complexity AX (and other sophisticated financial packages) allow several sets of current depreciated Values to be maintained simultaneously by using a Value Model to hold each set of values.
I hope this helps.
Thanks Roger..Can you also pls explain the difference between Deprection Books and Value models..as the setting value and purpose are also seem to be closely same..Pls explain the differences between the two with examples.
Yes, in my reply above I should really have said that Value Models together with Depreciiation Books allow several sets of depreciated values to maintained simultaneously.
The main difference is that Depreciation entries made in the Depreciation book journal post only to the Depreciation Book for the asset and not to the Value model. Therefore, the entries
posted through this journal do not affect the General ledger account balances: so Depreciation Books are not true financial postings and are used only for management reporting, whereas Value model postings are financial postings used for financial and management reporting.
I think you need an Asset/Tax accountant to advise on the detailed setup appropriate for a particular country, as national legislation varies so widely from one country to another.
Thanks..More than one value model can be attached to an asset...if value model postings are true financial postings. Pls explain can there be more than one financial postings if possible with an example scenario.
Hi Kumar
The simplest example is that the Value Models can relate to different Layers. There could be a Value Model for Balance Sheet/P&L postings in the Operations Layer, and a Value Model for Tax postings in the Tax Layer.
I caution once again about trying to find a use for every feature: in FA accounting in the UK, multiple Layers, multiple Value Models and mulitple Depreciation Books are seldom if ever used.
Regards
Hi,
Is it possible to run depreciation calculation on an asset that has not been acquired?
Thank you
Hello,
As per the design, you can run the depreciation for the acquired asset only.
Naushad. C. K.
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