Create Depreciation Types for Fixed Assets

This document explains how you create depreciation types; that is, basic categories for writing off fixed assets. The categories are connected to fixed asset types.

Outcome

Basic values for depreciation, such as depreciation range and start date, are defined.

Connect the depreciation type to a fixed asset type on 'FA Type. Connect Depreciation Types' (FAS077/E) and configure it further.

The depreciation type is used as a base for calculating:

  • Net value in 'Cost of Capital. Open' (FAS090/E).
  • Extraordinary depreciation for a specific fixed asset in 'FA Depreciation. Create Extraordinary' (FAS140/E).

The depreciation type is used as a selection criterion in:

  • 'Fixed Asset. Print Period Changes' (FAS520/E)
  • 'Fixed Asset. Print Historical Values' (FAS530/E)
  • 'Fixed Asset. Print Insurance Report' (FAS560/E)
  • 'Five Years FA Group History. Print' (FAS565/E).

The parameter file (CSYTAB) is updated.

Before you start

  • The starting conditions in Configuring Depreciation of Fixed Assets must be met.
  • A voucher number series, to be used when updating the general ledger, must be defined in 'Voucher Number Series. Open' (CRS410).
  • You must decide whether external or internal depreciation is to be used on (CRS750/E).

Follow these steps

  1. Start 'FA Depreciation Type. Open' (FAS050/B).

  2. Fill in the depreciation type ID (consisting of up to two alphanumeric characters). Click New.

  3. On the E panel, fill in description (required) and name.

  4. Select period range and period type (required values).

  5. Select whether depreciation below zero is accepted, whether the general ledger should be updated, and select a FAM function detail record (required). Press Enter.

Parameters to set

Program ID/Panel Field The field indicates …
(FAS050/E) Report Type ...how the depreciation type is used.

The report type alternatives are: economic, fiscal, technical, and finance agreement.
(FAS050/E) MACRS ...if the depreciation type is used for depreciation method 4 (MACRS formula) or 5 (MACRS user defined).
(FAS050/E) Period range

…how often the depreciation is to be calculated.

The period range alternatives are: annually, biannually, quarterly, bimonthly and monthly.

(FAS050/E) External/internal deprecations

…whether the depreciation is external (financial accounting) or internal (cost accounting).

You can decide, on (CRS750/E), whether the company uses both external and internal transactions. If the check box in (CRS750) is selected, you can choose whether external or internal depreciation is to be done. If the check box is not selected, external depreciation is automatically used.

(FAS050/E) Transfer to FIM

…whether the depreciation created updates the general ledger.

The option to update the general ledger is automatically proposed. A reason for not updating the general ledger could be that you want to simulate a calculation.

(FAS050/E) FAM Function …a detail record under FAM function FA10 used to assign voucher number and voucher name when updating the general ledger.
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