Capitalizing AssetsAsset capitalization is the process of recognizing that an asset has been placed into service in your company and is eligible for depreciation. Until an asset has been capitalized, it cannot depreciate in any of its related books. You can capitalize assets that have the Entered status or the Removed status. When you capitalize an asset, its status and the status of each of its related books changes from Entered to Acquired. If the asset book contains accumulated depreciation and is capitalized, the status of the asset book becomes Depreciating. After you capitalize an asset, you can begin depreciating it at any time. You can recapitalize assets that have the Removed status. If no depreciation has started for he asset, you can remove the capitalization of a capitalized asset. After you made the required changes to the asset, you must capitalize the asset again. All the subsequent FAM transactions such as depreciation and transfer will be based on the changed values. LN records the date you enter for the capitalization as the accounting period and year for the asset. The date you enter cannot be in a fiscal period prior to the asset's in-service date, must be an open period, and must fall within the start and end dates for the company with which the asset is associated. After you capitalize an asset, you can no longer directly change some of the information associated with it. You can make changes to this data by making an adjustment. For more information, see Asset adjustment. Note You can continue to add related books to an asset after capitalization. LN automatically sets the status of each book to Acquired when you save your changes. You cannot remove existing books from an asset after capitalization. To remove a book after capitalization, you must dispose of the asset in that book. For more information, see Disposing Asset Books. LN records journal entries for each asset you capitalize, using the values of the asset in its default general ledger book. You can prevent the journal entry from being made by using the Suppress Journal Entries check box in the Capitalization (tffam1200m000) session. For more information, see Capitalization Journals. Note If you capitalize an asset that should never have been placed into service, you can remove the capitalization status from it in the Remove Capitalization (tffam1201m000) session. This removes an asset from service and prevents it from depreciating. For more information, see Removing Asset Capitalization.
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