Ending Depreciation 

Use

The depreciation of a fixed asset is usually finished when a net book value of zero or the end of the planned useful life has been reached. Sometimes, the book value has not yet reached zero when the useful life is expired, due to the depreciation method used. By adjusting the way the system handles the end of depreciation (in the internal calculation key), you can continue to depreciate beyond the end of the useful life.

Features

Curb

With depreciation beyond the planned useful life, the depreciation percentage rate can be derived, not only from the planned useful life, but also from the actual useful life. This method produces a declining-balance effect instead of a straight-line effect (curb).

An asset that originally had a useful life of 10 years is depreciated in year 11 by 1/11 = 9.09 %, in year 12 by 8.33 % and in year n with 100/n %.

When you use below-zero depreciation with a curb, the system determines the percentage rate, after the end of planned life, to the exact period and not to the year.

Depreciation Below Zero

It is also possible to depreciate below zero as long as the depreciation area allows a negative net book value. You have to set an indicator in the internal calculation key to allow this kind of depreciation. Depreciation below zero can, for example, be useful for cost-accounting purposes.

If you choose an appropriate changeover key, you can also depreciate after the end of useful life using a different calculation key. For more information, see Changeover Key.

End of Depreciation at End of Fiscal Year

Depreciation usually ends within the fiscal year due to the fact that the depreciation start date for the asset is also within the fiscal year. Using a control function in the calculation key, you can automatically reduce the useful life so that the close of depreciation always falls at the end of the fiscal year.